UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
DC  20549




FORM
10-KSB/A


Amendment
No. 1










[X]
            ANNUAL REPORT UNDER SECTION 13 OR
      15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
      December 31, 2007[  
      ]
            TRANSITION REPORT UNDER SECTION 13
      OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
  1934For the transition period fromto







Commission
File No. 001-31338







Wireless
Age Communications, Inc.


(Name of Small
Business Issuer in its charter)





Nevada
              (State or
      other jurisdiction of incorporation or organization)
            98-0336674
              (I.R.S.
      Employer Identification No.)3565
      King Road, Suite 102
              King
      City, Ontario
              L7B
      1M3
              (Address of
      Principal Executive Offices)
            905-833-2753
              (Issuer’s Telephone
      Number)






Securities
registered under Section 12(b) of the Exchange Act: None





Securities
registered under Section 12(g) of the Exchange Act: Common Stock, par value
$0.001




Check whether the
issuer is not required to file reports pursuant to Section 13 or 15(d) of the
Exchange Act  o





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 x No o




Check if there is
no disclosure of delinquent filers in response to Item 405 of Regulation S-B
contained in this Form, and  no disclosure will be contained, to the
best of the registrant’s knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB o





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


The issuer’s
revenues for the fiscal year ended December 31, 2007 were
$32,682,756.





Based on the
closing price on March 17, 2008 of $0.34 per share of common stock, as reported
by the NASD’s OTC Bulletin Board, the aggregate market value of the voting and
non-voting stock held by non-affiliates of the registrant was approximately
$8,690,111.  For the purposes of this response, directors, officers
and holders of 5% or more of the issuer’s Common Stock are considered the
affiliates of the issuer at such date.





As of March 17,
2008, the number of shares outstanding of the registrant’s Common Stock was
58,781,842 shares.





DOCUMENTS
INCORPORATED BY REFERENCE





The following
document is incorporated by reference into Part III of the Annual Report on Form
10-KSB: None





Transitional Small
Business Disclosure Format (check one):  Yes   ̈    No  x








Explanatory Note: This Amendment No. 1
on Form 10-KSB of Wireless Age Communications, Inc. for the fiscal year ended
December 31, 2007, which was filed with the Securities and Exchange Commission
(the “SEC”) on March 31, 2008, is to restate the financial statements for the
fiscal periods ended December 31, 2006 and 2007, for errors identified by the
Company.The consolidated balance sheets as at December 31,
2007 and 2006, and the consolidated statements of operations ,cash flows and
stockholders’ equity (deficiency) for the fiscal years ended December 31, 2007
and 2006 have been restated to correct the following errors:





1) In December
2007, the Company amended the terms of its existing line of credit. Under the
amended credit facilities, the Company, together with its controlling
shareholder, Newlook Industries Corp., became co-borrowers of a loan totaling
$2,520,000.  The amended facilities included: 1) a new $1,513,000 (CAD
$1,500,000) 18% per annum 3 year term loan; and 2) a $1,007,000 (CAD $1,000,000)
revolving facility. The assets of the Company remained as collateral for the
amended facilities.  As at December 31, 2007, $1,513,200 was drawn
under the term loan and $nil was drawn under the revolving facility. The Company
and Newlook agreed that the full proceeds of the term loan would be advanced to
Newlook.  The Company did not originally recognize the term loan on
its consolidated balance sheet as at December 31, 2007 on the basis that the
proceeds were fully advanced to Newlook. Upon further analysis, the Company
concluded this accounting treatment was incorrect as this did not reflect its
legal obligation as a borrower under the facility.  As a result, the
Company has restated its consolidated balance sheet to reflect its obligation
under the term loan with a corresponding “Due from related parties” balance
representing the amount advanced to Newlook;





2) In 2006 and
2007, the Company recognized incremental beneficial conversion features in its
convertible preferred stock upon the resolution of certain contingent events
that decreased the price into which the preferred stock could be converted into
common stock.  This resulted in the recognition of deemed dividends of
$3,848,714 and $2,515,767 in 2006 and 2007, respectively, which, in total,
represented an excess of $5,995,101 over the proceeds originally ascribed to the
conversion feature on its initial recognition. Upon further review of Emerging
Issues Taks Force (“EITF”) Issue No. 98-5, Accounting for Convertible Securities
with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios
(“EITF 98-5”), the Company determined that the excess should be reversed in
order to limit the discount assigned to the beneficial conversion feature to the
amount of the proceeds allocated to it. The impact of this restatement for both
2006 and 2007 is to decrease expenses, accumulated deficit, and additional
paid-in-capital.





3) In 2007, the
Company issued 6,666,667 common shares to Newlook to cancel 5,000,000 A warrants
and 5,000,000 B warrants (see Note 14), and recognized an expense of $673,274
equal to the difference between the fair value of the common shares and the
carrying value of the warrants.  The Company has reallocated the
expense to accumulated deficit as the issuance of common shares represents, in
substance, a payment made to induce conversion of the warrants; the Company
therefore accounted for the transaction in a manner similar to that prescribed
by EITF Topic D-42, The Effect on the Calculation of Earnings per Share for the
Redemption or Induced Conversion of Preferred Stock. The impact of this
restatement is to decrease expenses in 2007.




















Wireless
Age Communications, Inc.












Table
of Contents












PART
      IItem
      1.
            Description
      of Business
            2Item
      2.
            Description
      of Property
            9Item
      3.
            Legal
      Proceedings
            10Item
      4.
            Submission of
      Matters to a Vote of Security Holders
            10PART
      IIItem
      5.
            Market for
      Common Equity and Related Stockholders Matters
            11Item
      6.
            Management’s
      Discussion and Analysis or Plan of Operation
            12Item
      7.
            Financial
      Statements
            21Item
      8.
            Changes in
      and Disagreements with Accountants on Accounting and Financial
      Disclosure
            22PART
      IIIItem
      9.
            Directors,
      Executive Officers, Promoters and Control Persons; Compliance with Section
      16(a) of the Exchange Act
            23Item
      10.
            Executive
      Compensation
            27Item
      11
            Security
      Ownership of Certain Beneficial Owners and Management
            31Item
      12.
            Certain
      Relationships and Related Transactions, and Director
      Independence
            32Item
      13
            Exhibits,
      List and Reports on Form 8-K
            33Item
      14.
            Principal
      Accountant Fees and Services
            34Signatures
            35







1


Part
I




Item
      1.
            Description
      of Business.





Development of
business





The Company was
incorporated in the State of Nevada on November 17, 2000 as Lennoc Ventures,
Inc.  On October 20, 2002, the Company acquired Wireless Age
Communications, Ltd. and changed its name to Wireless Age Communications,
Inc.  Prior to the acquisition of Wireless Age Communications, Ltd.,
the Company was a pre-exploration stage mining company.  The Company
ceased its mineral and exploration business in October 2002.





During fiscal 2007,
the Company’s business operations primarily focused on provision of wireless
telecommunications systems products and service solutions to carriers,
wholesalers, distributors, retailers and end-users in Western Canada. Current
products and services include mobile and fixed voice and data communication
services, phone and data devices and accessories, land mobile, microwave and
PCS/Cellular radio equipment, components and test equipment used by operators
and manufacturers of wireless equipment, and power and battery
supplies.





Wireless Age
operates nine retail stores, has sales offices in two locations across Canada,
and one warehouse, along with a service department.  The Company has
significant business relationships with major wireless, and wireline carriers in
Canada.  The Company’s presence in the cellular, land mobile radio,
satellite, and fixed wireless markets allow it to bundle a full spectrum of
products at the carrier, distributor, wholesaler and retail level across
Canada.





During fiscal 2007
Wireless Age conducted its business through the following
subsidiaries:





·
            Wireless Age
      Communications Ltd. (99.7% owned) is in the business of operating nine
      retail cellular and telecommunications stores located in Western
      Canada.





·
            Wireless
      Source Distribution Ltd. distributes prepaid cellular phone cards in
      Saskatchewan and various cellular and land mobile radio accessories in
      Western Canada.





·
            Prime
      Wireless Corporation is the Exclusive Representative of Vertex Standard
      U.S.A. Inc. in Canada. Vertex Standard manufactures land mobile radio
      products and accessories. Prime Wireless Corporation earns sales
      commissions from direct shipment from Vertex Standard in the United States
      of America to Canadian wholesale and retail
  distributors.





·
            Our
      subsidiaries Prime Battery Products Limited, DB Sim Holdings Ltd. and
      1588102 Ontario Inc. are inactive and have no revenues or
      expenses.





Acquisitions





Wireless Age
Communications Ltd. was acquired on October 8, 2002, Wireless Source
Distribution Ltd. on September 19, 2003





Employees





At the end of 2007,
the Company employed approximately 95 full and part-time
employees.  There are no collective bargaining agreements covering any
of the employees and the Company has not experienced a strike or work
stoppage.





The Wireless
Industry





The wireless
industry is characterized by changing technology and the rapid widespread
adoption of such technology. From being a luxury utilized by only a small
percentage of the population one generation ago, mobile wireless technologies
have now come to be widespread in Canada and the United States, as well as
elsewhere. This expansion in the numbers of users has advanced alongside radical
improvements in the quality of wireless products available, and a remarkable
drop in their cost. Recently though, the exponential growth of the industry in
North America has begun to slow. This trend is widely seen as continuing
throughout the decade. The Company's industry expectations are that the growth
rate in the mobile wireless subscriber market will fall.





With the relatively
recently achieved popularity of mobile wireless technology, public awareness of
the actual or perceived draw-backs of wireless technology has increased. The
news media has reported incidents of automobile


2


accidents allegedly
caused by the use of mobile telephone while driving. Radio frequency emissions
from wireless devices have linked to various health concerns, including cancer,
and it has been reported that they may interfere with various electronic medical
devices, including hearing aids and pacemakers.





Furthermore, the
wireless industry and the public use of its goods and services is subject to
national and either state or provincial regulations in the United States and
Canada. It is difficult to predict the direction new regulation of the industry
may take in the future.





Land Mobile Radio
Industry





Land Mobile Radio
("LMR") two-way radio communications consist of a broad array of
users:





·
            Public
      Safety: police, fire, and emergency medical
  personnel;





·
            Businesses:
      hotels, airports, farms, car services, construction firms;
    and





·
            Government
      Agencies.





LMR systems are
typically configured for hand-held use and/or vehicular mobile use. LMR systems
are generally designed to meet an organization's specific communication
requirements. The cost of a system varies widely. Typically, there are no
recurring airtime usage charges as is typically the case with wireless telephone
subscription communications. Accordingly, LMR users often factor airtime cost
considerations into determinations whether to purchase an LMR system or rely on
commercially available wireless communications systems.





LMR systems are
among the oldest and continuously widely used form of wireless dispatch
communications. Advances in technology in recent years have generally decreased
the cost of LMR products and increased its usage base.





In recent years LMR
has been characterized by relatively slow growth. This growth rate is a
reflection of several factors:





LMR is generally
considered a mature industry;





·
            some LMR
      users are in mature industry segments that are themselves experiencing
      slow growth rates; and





·
            growth has
      been impaired by the lack of available radio spectrum, which has prevented
      existing users from expanding their systems and hampered efforts of many
      potential new users from obtaining licenses for new
    systems.





As a result of the
lack of available spectrum, the Federal Communications Commission (“FCC”) has
mandated that new LMR equipment in the United States utilize technology that is
more spectrum-efficient. This effectively requires LMR users to migrate to
digital systems. Although the FCC does not require public safety agencies to
purchase supplier specific equipment, compliance with the standard is
increasingly becoming a key consideration for government and public safety
purchasers.





Several LMR
manufacturers have recommended a specified industry standard for digital LMR
devices that would meet the FCC requirements and provide solutions to several
problems experienced primarily by public safety users. The primary objectives of
the standard are to i) allow effective and reliable communication among users of
compliant equipment, regardless of its manufacturer, ii) maximize radio spectrum
efficiency, and iii) promote competition among LMR providers through an open
system architecture.





Although the FCC
does not require public safety agencies to purchase the proposed standard
compliant equipment or otherwise adopt the standard, compliance with the
standard is increasingly becoming the key consideration for government and
public safety purchasers. The open architecture of the proposed standard may
eliminate the ability of one or more major companies to lock out competitors.
Previously, because of proprietary aspects of conventional analog LMR systems,
customers were effectively precluded from purchasing competing LMR
products.





Competition





The markets for
distributing wireless phones and accessories and for integrated supply chain and
logistics services are intensely competitive. The Company competes, and expects
to continue to compete, for sales of wireless phones, accessories and data
equipment with several wireless communications device distributors and
manufacturers. The


3


Company competes
principally on the bases of inventory availability, delivery time, trade credit
terms and service. The Company also competes principally on the bases of service
quality and price for supply availability. Competitors are primarily retail
purchasers. Direct competitors include:





·
            In
      Saskatchewan: (1) all wireless retailer that are channel partners of other
      carriers such as AT&T Wireless and Telus Mobility, (2) Jump.ca and
      Prairie Mobility who sell products from the same carrier as us, and (3)
      SaskTel Corporate who sells directly to large
  customers.





·
            In Manitoba:
      (1) IDC Communications, (2) Elite Communications, (3) Advance Electronics,
      (4) 4L Communications, and (5) MTS Corporate, who sells directly to large
      customers.





In the future, the
Company may increasingly compete with wireless communications device
manufacturers that decide to provide their products directly to wireless network
operators. Also, new competitors may enter the industry. The products that the
Company distributes could have reduced consumer demand if companies that compete
with our suppliers manufacture products that are, because of more favorable
pricing or other reasons, more desired by consumers. Many of the current
competitors have, and many future competitors will likely have, more name
recognition and greater financial and other resources than us. The Company’s
ability to successfully compete will largely depend on the ability to
continually anticipate and respond to competitive factors affecting the
industry, including changing outsourcing requirements, new products, changes in
consumer preferences, demographic trends, international, regional and local
economic and financial conditions and our competitors' discount pricing and
promotional programs. As the wireless communications markets continue to mature,
and as the Company seeks to enter into additional markets and offer new
products, we expect that the competition that the Company faces will intensify.
Management believes that our various competitive strengths, principally
including the local presence throughout Western Canada, our developed market
expertise, will enable the Company to compete successfully in the markets in
which it operates, as well as to expand the business into new geographic and
product areas.





Financial
information segments





During 2007, the
Company operated two reportable segments: Retail and Commercial. The Retail
segment is comprised of the operations of Wireless Age Communications Ltd. The
Commercial segment is comprised of the operations of Prime Wireless Corporation,
Prime Battery Products Limited, and Wireless Source Distribution
Ltd.





Retail
Segment





The Company
operates nine retail stores and business communications service centers under
the name “The Wireless
Age” in Western Canada.  This business unitgenerates revenues from
the sale of cellular phones and accessories, wireless handheld devices such as
the Blackberry, satellite phones and two-way radios and other wireless devices
and pre-paid cards.  The operation receives activation fees and a
residual percentage of the cellular bills of the subscribers it activates and
has under management. The Wireless Age also generates commission based revenue
from its telephone company partners for activating and signing up subscribers
for other services including high speed internet, digital television and
landline based telephone, and security services.





The Retail segment
has a well known brand name and a strategy of competing on service provided by
its people.  Its core competencies are sales & product training
and service programs which are made possible by the number of stores in the
unit, and constant measurement and feedback.  Its people are very
well-trained, monitored and coached, and are knowledgeable enough to provide
exceptional service and to see and execute upsell opportunities.  The
Company uses numerous direct marketing programs to cross-sell customers to
increase share of wallet by providing all their telecom and entertainment needs,
and generate store traffic.





Commercial
Segment





Wireless Source, part of the
Company’s Commercial business segment distributes prepaid phone cards, wireless
accessories, land mobile radios, batteries and ancillary electronics products
throughout Canada.  It has sales personnel across the country and
warehouse facilities in Regina.





Wireless Source
also generates revenue from its exclusive representation agreement for Canada
with Vertex-StandardTM Inc., a company operating in the Land Mobile Radio (LMR)
business worldwide.  This unit serves two distinct dealer communities:
PCS dealers (mobile phone stores) and Land Mobile Radio (LMR) dealers (two-way
radio shops).


4


Customers





During fiscal 2007
the Company had in excess of 45,000 retail customers. The Company does not have
a significant concentration of sales with any individual customer and,
therefore, the loss of one of these customers would not have a material impact
on the Retail business. However, the activation commissions and residuals
revenue earned from two major telephone carriers made up 60% of the retail
segment sales. If either of these agreements were terminated it may have a
significant effect on the retail business. For the wholesale segment no single
customer made up more then 10% or more of the wholesale sales and therefore the
loss of any one customer would not have a significant effect on the wholesale
business.





Research and
development





The Company did not
engage in any material research and development activities during the past two
years.





Environmental
matters





The Company is not
aware of any federal, state or local provisions which have been enacted or
adopted regulating the discharge of materials into the environment, or otherwise
relating to the protection of the environment, that will materially effect out
net earnings or competitive position, or result in material capital
expenditures. However, we cannot predict with certainty the potential effect on
our operations of possible future environmental legislation or regulations.
During 2007, there were no material capital expenditures for environmental
control facilities and no such material expenditures are
anticipated.





Suppliers





The Company depends
on a broad selection of high quality, brand-name products to offer its
customers. In turn the success of the Company is dependant on satisfactory and
stable supplier relationships. The Company enters into supply and/or
distribution agreements with its major suppliers. The loss of or disruption in
supply from any one of these major suppliers could have a material adverse
effect on our revenue and earnings. The Company has not experienced any
significant difficulty in maintaining satisfactory sources of
supply.





Intellectual
Property





The Company owns
intellectual property including the trade names The Wireless Age, mmwave, AC
Simmonds & Sons and iMobile in addition to several supplier agreements and
distribution agreements. The Company believes that the intellectual property is
an important asset and the Company is not aware of any facts that could
negatively impact our continuing use of any of our intellectual property. In
accordance with the accounting principles generally accepted in the United
States (“GAAP”), our balance sheets only include the cost of acquired
intellectual property.





Recent
Developments





Renegotiated
TCE Capital Corporation Financing





On December 13,
2007, Wireless Age entered into a series of agreements to amend the terms of its
loan facility with TCE Capital Corporation (“TCE”).





Wireless Age and
Newlook Industries Corp. (“Newlook”), controlling shareholder of Wireless Age,
combined their assets and collateral to create a new loan facility totaling
CAD$2,500,000 (approximately US$2,520,000). The amended facility includes; 1) a
new CAD$1,500,000 (US$1,513,000) 18% per annum, 3 year term loan and 2) the
existing Wireless Age CAD$1,500,000 loan facility is reduced to CAD$1,000,000
(US$1,007,000). The effective annual interest rate on latter portion of the new
facility is reduced from approximately 24.6% to approximately 17.9%. The term
loan is interest only and may be retired 18 months into the term on 90 days
notice subject to a CAD$75,000 (US$76,000) prepayment penalty.





Newlook is the
controlling shareholder of Wireless Age.





The new facilities
were arranged by way of Wireless Age (and certain of its subsidiaries) and
Newlook (including its subsidiary Onlinetel Corp.) entering into a Factoring
Agreement Amendment Agreement with TCE Capital Corporation.


5


Certain operating
subsidiaries also entered into Cross Guarantee and Postponement of Claim
Agreements of the indebtedness of Newlook to TCE. Wireless Age entered into
Continuing Guarantee and Postponement of Claim Agreements with TCE. Other
documentation customary with transactions of this type was executed by the
various parties. Newlook and Wireless Age are co-borrowers under the
facilities.





Acquisition
of Newlook Industries Corp. Securities





During fiscal 2007,
in several private transactions, the Company acquired 2,680,307 common shares
and a warrant to acquire an additional 900,000 common shares at $0.40 each (the
“Warrant” and collectively the Newlook Securities”) of Newlook. Newlook is a
publicly listed entity trading on the TSX Venture Exchange (“TSX-V”) under the
symbol “NLI”.





The Company paid
total cash proceeds of $1,324,618 for the Newlook Securities.





The Company
acquired 240,000 Newlook common shares and the Warrant to acquire an additional
900,000 common shares of Newlook from a related party, Eiger Technology Inc.
(“Eiger”).  Eiger is a publicly listed entity trading on the TSX under
the symbol “AXA” and is a shareholder of Newlook. Eiger and Wireless Age have
certain common directors and officers. The Company acquired a total of 1,145,000
Newlook common shares from an unrelated entity, Morningside Capital Limited, a
total of 751,807 Newlook common shares from Brad and Glenn Poulos (former
officers and directors) and a total of 543,500 from unrelated private
investors.





Newlook is the
majority shareholder of Wireless Age by virtue of holding 31,594,767 common
shares which represents a 53% ownership position in Wireless Age. Through these
acquisitions Wireless Age acquired a direct 9.1% ownership interest in Newlook.
In addition in the event all warrants are exercised under the Warrant, Wireless
Age’s ownership position will be increased to 12.1%.





Pursuant to the
terms of the Warrant the Company has the right but not the obligation to acquire
an additional 180,000 Newlook common shares from Eiger on each of March 18,
2008, September 18, 2008, March 18, 2009, September 18, 2009 and March 18, 2010
at CAD$0.40 per common share.





The purpose of
investment in the Newlook Securities was to reinvest recent operating profits,
improve the Company’s working capital position and financial gain due to the
appreciation of Newlook’s common stock share price.





Retail
Acquisition – GL Enns





On November 1,
2007, the Company’s majority owned subsidiary Wireless Age Communications Ltd.
acquired the wireless retail business assets of G.L. Enns Electronics (“GL
Enns”) which is a sole proprietorship of Gordon Enns. The assets include an MTS
Connect Store in Selkirk Plaza, Selkirk, Manitoba including, residuals,
commissions, customer database and other intellectual property.





GL Enns has 3,300
active cellular clients in Manitoba generating residuals.





The purchase price
was $206,800 (CAD$205,000), $105,900 (CAD$105,000) cash at closing and the
balance payable in equal monthly payment of $25,225 on each of January 31,
February 28, March 31 and April 30, 2008.





New
Corporate Office Location





On September 14,
2007, the Company relocated to a new 2,500 square foot corporate office at 3565
King Road, Suite 102, King City, Ontario, Canada L7B 1M3, telephone –
905-833-2753, fax – 905-833-9847





Newlook
Settlement Agreement





On August 3, 2006,
the Company entered into an agreement with Barron Partners LP, (“Barron
Partners”) an investment fund based in New York (the “Barron Agreement”),
pursuant to which Barron Partners made an investment in convertible preferred
stock (the “Series A Preferred Shares”) and warrants of the Company. The Series
A Preferred Shares and the warrants (if fully exercised under the initial terms
and conditions) would generate total proceeds of $6.625 million to the Company.
At the closing, the Company received $1,000,000 cash and issued 7,142,900 Series
A


6


Preferred Shares
and warrants to purchase 7,500,000 common shares at $0.25 per share and
7,500,000 common shares at $0.50 per share.





Under the terms of
the Barron Agreement the conversion rate of the preferred stock and the exercise
price of the warrants may be adjusted based on whether the Company meets certain
operating performance criteria. The criteria are measured twice, first based on
the operating results of fiscal 2006 and second based on the operating results
of fiscal 2007. During fiscal 2006 the initial $0.14 per share conversion rate
on the preferred stock, the initial $0.25 per share exercise price of the A
warrants and the initial $0.50 per share exercise price of the B warrants, could
be adjusted downward if the Company did not achieve $0.012 pre-tax earnings per
share from continuing operations and excluding non-recurring items during fiscal
2006. The adjustment is limited to a maximum of 50%. The initial (or adjusted)
conversion and exercise prices will again be subject to an adjustment if the
Company does not achieve $0.069 pre-tax earnings per share from continuing
operations and excluding non-recurring items during fiscal 2007. The adjustment
is again limited to 50% based on the 2007 criteria.





The Company
recorded a deemed dividend on issuance of preferred stock of $369,380
representing the value of the conversion feature of the preferred stock on date
of issuance. This non-operating expense arises from Financial Accounting
Standards Board, Emerging Issues Task Force (“EITF”) abstracts 98-5 and 00-27
and represents a non-cash charge to income representing the intrinsic value of
the beneficial conversion option inherent in the preferred shares.





Under the terms of
the Barron Agreement, the initial exercise price of certain warrants were
adjusted from $0.25 to $0.125 per share for 7,500,000 A warrants and from $0.50
to $0.25 per share for 7,500,000 B warrants due to the Company’s failure to
attain the minimum pre-tax earnings per share targets. The proceeds from
exercise of the warrants (if fully exercised) were reduced to
$2,812,500.





On June 29, 2007
the Company entered into a Settlement Agreement and Release with
Newlook.





On April 30, 2007,
Newlook acquired a package of Wireless Age securities from Barron Partners that
consisted of:





·
            1,482,400
      common shares


·
            4,192,900
      Series A convertible preferred shares which currently convert into
      8,385,800 common shares


·
            A warrants to
      purchase 5,000,000 common shares at $0.125 per
  share


·
            B warrants to
      purchase 5,000,000 common shares at $0.25 per
  share





Through this
investment Barron Partners assigned to Newlook certain terms and conditions of
their investment in Wireless Age. The terms and conditions included a covenant
that in the event Wireless Age failed to meet certain fiscal 2007 operating
performance targets the conversion rate of the Series A convertible preferred
shares would drop from $0.07 per share to $0.035 per share (which effectively
meant that the preferred shares would convert into 16,771,600 common shares) and
the exercise price of the A and B warrants would reduce from $0.125 to $0.0625
per share and from $0.25 to $0.125 per share, respectively. The terms and
conditions also included a covenant that the Company’s board of directors at all
times must consist of a minimum of 5 directors the majority of which had to be
independent.





Management felt
that the 2007 operating performance targets were unlikely to be met and since
February 4, 2007 the board of directors did not consist of a majority of
independent directors.





On June 29, 2007,
Wireless Age and Newlook mutually agreed to a settlement and release whereby the
Company issued 26,638,267 restricted common shares to Newlook as a full and
complete settlement for all liquidated damages arising from defaults under the
assigned investment agreement, the conversion of preferred stock and the
cashless exercise of all warrants. Under the terms of the settlement and release
the Company agreed to accelerate the effects accruing to Newlook of Wireless Age
not attaining the 2007 operating performance targets. The Company agreed to
issue:





·
            16,771,600
      restricted common shares in exchange for the 4,192,900 Series A preferred
      shares,


·
            6,666,667
      restricted common shares of in exchange for (i) the A Warrants to purchase
      5,000,000 common shares; and (ii) the B Warrants to purchase 5,000,000
      common shares,


·
            3,200,000
      restricted common shares in settlement of liquidated damages arising from
      the composition of Wireless Age’s
Board.





In addition, the
Company agreed to appoint Jason Moretto, an officer and director of Newlook, to
the Wireless Age board of directors.


7





Change
in Control




On June 29, 2007, a
change in control of the Company occurred. As a result of entering into the
Settlement and Release and a Share Exchange Agreement with third parties on June
29, 2007, Newlook owned 31,594,767 shares of the Company's common stock, which
was 53.4% of the total number of issued and outstanding shares of the Company's
common stock as of the date of the agreements.




On June 29, 2007,
Newlook acquired an additional 3,426,500 shares of the Company's common stock
pursuant to the terms and conditions of a Share Exchange Agreement (the "Share
Exchange Agreement") by and among Newlook and Bradley Poulos, Brad Poulos
Holdings, Glenn Poulos, Glenn Poulos Holdings and Sylvain LaFreniere. Pursuant
to the Share Exchange Agreement, Newlook exchanged 1,018,432 shares of Newlook's
securities in exchange for 3,426,500 shares of the Company's common
stock.




mmwave
Bankruptcy





On June 29, 2007,
the Company, pursuant to the laws of the Bankruptcy and Insolvency Act of
Canada, assigned mmwave, a wholly owned subsidiary of the Company, into
bankruptcy. A trustee in bankruptcy took over the financial affairs of mmwave
and was tasked with collecting from the remaining debtors of the Company,
liquidating all remaining assets and distributing any proceeds realized to
creditors according to bankruptcy law.





Sale
of Knowlton Pass





On March 1, 2007, the Company closed
the sale of Knowlton Pass Electronics Inc. (which operated as Wireless Works).
The Company sold all of the issued and outstanding shares of Knowlton Pass to
David MacKinnon (a former employee of the Company) in exchange for a 5 year
promissory note (principal value of such note calculated from final Knowlton
Pass February balance sheet) and the forgiveness by David MacKinnon of
contingent severance obligations otherwise due to him(pursuant to the
terms of his termination in September 2006, David MacKinnon was to receive
severance payments totaling approximately $342,000 over a period of two years
and 8 months). This is discussed in the attached financial
statements.


.


Officer
and Director Resignations





On February 13,
2007, David Valliere resigned as a member of the Board of Directors. On February
19, 2007, Glenn Poulos entered into an agreement with the Company whereby he
resigned as a member of the Board of Directors of the Company, as President of
the Company’s wholly owned subsidiary mmwave and as a Director of mmwave. Under
the provision of the agreement Glenn Poulos will receive a severance of
approximately $122,000 over a one year period. On February 19, 2007, Bradley
Poulos entered into an agreement with the Company whereby he resigned as
President of the Company and as Chairman of the Board of Directors. Under the
provision of his agreement Brad Poulos will receive a severance of approximately
$360,000 over a three year period. With his resignation as an officer of the
Company he became an independent non-executive member of the Board of
Directors.





Brad Poulos and
Glenn Poulos agreed to return 900,000 and 1,000,000 shares of the Company’s
common stock, respectively, issued as a special bonus during the month of August
2006 subject to receiving three year warrants to purchase the same number of
shares of the Company’s common stock exercisable at $0.15 per share. At the time
of issuance, Brad Poulos directed the Company to issue 100,000 of his 1,000,000
share bonus to Gary Hokkanen, the Company’s Chief Financial Officer. Gary
Hokkanen also agreed to return 100,000 shares of the Company’s common stock
issued as a special bonus and will receive warrants on the same replacement
basis as Brad Poulos and Glenn Poulos.





On May 16, 2007 the
Company announced the resignation of Bradley John Poulos as a director of
Wireless Age.





Brad Poulos was
appointed a director of Wireless Age in March 2005 and became chairman of the
board in April 2006. In February 2007 he resigned as chairman but remained as a
director. He also served as President and CEO from September 2005 through
February 2007.





8


Appointment
of New Chief Executive Officer





On February 4,
2007, Brad Poulos resigned as Chief Executive Officer of the Company. On the
same date, the Board appointed John Simmonds as a director and as the Company’s
interim Chief Executive Officer.  In addition, the Board has appointed
Carrie Weiler, the Company’s Corporate Secretary, as a director.





Subsequent
Events:





Callmore
Acquisition





On March 20, 2008,
the Company acquired all of the business assets of Callmore Communications Inc.
for $100,880) (CAD$100,000), $25,220 (CAD$25,000) paid at closing and $25,220
paid in three consecutive monthly payments beginning April 1, 2008. The Callmore
business assets will be utilized within the Commercial operating
segment.





Stock
Repurchases





In January 2008,
the Company acquired 691,500 shares of its common stock in private transactions
with several third parties at an average share price of CAD$0.19 per share. The
Company acquired the shares for cash consideration of CAD$107,400 and debt
forgiveness of approximately CAD$25,000.





The Company
acquired a further 87,300 of its common stock during the month of February 2008
under a stock repurchase plan at an average share price of US$0.315 per share.
The Company previously informed shareholders it intends to acquire up to
5,000,000 shares under a Rule 10b-18 stock repurchase plan during calendar 2008.
To date, including private transactions outside of the Rule 10b-18 plan, the
Company has acquired a total of 778,800 shares of common stock for cancellation
at an average price of US$0.205 per share.





Exercise of Option
to Acquire Newlook Securities





On March 8, 2008,
The Company exercised an option to acquire 180,000 common shares of Newlook in
exchange for a cash payment of $72,634 (CAD$72,000).









Item
2.  Description of Property.


The executive
offices of Wireless Age are located at 3565 King Road, Suite 102, King City,
Ontario, Canada L7B 1M3, (telephone – 905-833-2753, fax –
905-833-9847.  Wireless Canada's and Wireless Source's offices are
located at 1408 Broad Street, Regina, Saskatchewan, Canada, S4R 1Y9 (tel.
306-751-7720, fax 306-751-7726).  The Wireless Canada and Wireless
Source offices consist of approximately 4,000 square feet. Wireless Canada's
retail operations consist of nine retail stores located in Saskatchewan and
Manitoba, Canada.  The following is a summary of the retail, warehouse
and office locations:





Address
            Square
      Feet
            Leased/Owned
            Expiry of
      Lease1408B Broad
      Street, Regina (office)
            2,000
            Leased
            Month to
      month3565 King
      Road, Suite 102, King City
            2,500
            Leased
            September
      2012




Retail:




2223 Victoria
      Ave. East, Regina
            675
            Leased
            Month to
      month1401 Broad
      Street, Regina
            3,996
            Leased
            November
      20104131 Rochdale
      Blvd., Regina
            1,255
            Leased
            March
      20092325 Preston
      Ave., Saskatoon
            403
            Leased
            Month to
      month300 Circle
      Dr., Saskatoon
            3,250
            Leased
            July
      2010105-3393
      Portage Ave. Winnipeg
            1,545
            Leased
            November
      2008Unit 76,
      Cityplace, Winnipeg
            576
            Leased
            June
      2007Unit 247-393
      Portage Ave., Winnipeg
            777
            Leased
            November
      2011Unit 209,
      Garden City Center, Winnipeg
            2,071
            Leased
            December
      2008Unit 8,
      Selkirk Town Plaza, Selkirk
            600
            Leased
            May
      2008





9


Investment
Policies.  The Company does not currently make real estate
investments and has not established specific policies in regard to real estate
investments. There are currently no limitations on the percentage of assets
which may be invested in any one investment, or type of
investment.  The Company may establish or change its policies in such
regard without a vote of security holders.  The Company may acquire
real property assets in the future, at which date a determination will be made
by the Board of Directors whether such investment is to be made primarily made
for possible capital gain or primarily for income.









Item
3.  Legal Proceedings.


To the knowledge of
the Company, there are no other material pending legal proceedings to which the
Company is a party or of which any of its property is subject and Company
management is not aware of any threatened proceedings by any other person,
organization or governmental authority.








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





No matters were
submitted to a vote of security holders during the fourth quarter
2007.




10





PART
      II







Item
5.  Market for Common Equity and Related Stockholder
Matters.


Market
Information




The price per share
of Company Common Stock is quoted on the NASD’s OTC Bulletin Board under the
symbol “WLSA”. Prior to October 29, 2003 the Company’s stock did not
trade.




The following table
sets forth for the periods indicated the high and low close prices for the
Common Shares in U.S. Dollars.  These quotations reflect only
inter-dealer prices, without retail mark-up, mark-down or commissions and may
not represent actual transactions.






Quarter
    Ended
            
            High
            
            
            LowMarch 31,
      2005
            
            $
            0.86
            
            
            $
            0.41June 30,
      2005
            
            $
            0.63
            
            
            $
            0.49September 30,
      2005
            
            $
            0.55
            
            
            $
            0.39December 31,
      2005
            
            $
            0.49
            
            
            $
            0.30March 31,
      2006
            
            $
            0.43
            
            
            $
            0.32June 30,
      2006
            
            $
            0.38
            
            
            $
            0.22September 30,
      2006
            
            $
            0.36
            
            
            $
            0.24December 31,
      2006
            
            $
            0.25
            
            
            $
            0.17March 31,
      2007
            
            $
            0.26
            
            
            $
            0.06June 30,
      2007
            
            $
            0.15
            
            
            $
            0.07September 30,
      2007
            
            $
            0.15
            
            
            $
            0.09December 31,
      2007
            
            $
            0.29
            
            
            $
            0.12








Shareholders





As of December 31,
2007, the Company had approximately 3,948 shareholders of record.





Dividends





The Company does
not expect to pay a cash dividend on its common stock in the foreseeable
future.  Payment of dividends in the future will depend on the
Company’s earnings and its cash requirements at that time.





Securities
Authorized For Issuance Under Equity Compensation Plans





None





2007 Equity
Securities Issuances





During fiscal 2007,
the Company issued 357,157 restricted shares of its common stock to Max
Communications, Inc., valued at $25,715, as consideration for consulting
services provided.





Also during fiscal
2007, the Company issued to Newlook the following securities:





·
            16,771,600
      restricted common shares in exchange for the 4,192,900 Series A preferred
      shares,


·
            6,666,667
      restricted common shares of in exchange for (i) the A Warrants to purchase
      5,000,000 common shares; and (ii) the B Warrants to purchase 5,000,000
      common shares,


·
            3,200,000
      restricted common shares in settlement of liquidated damages arising from
      the composition of Wireless Age’s
Board.








11


The Company entered
into the aforementioned transactions in reliance upon the exemption from
securities registration afforded by Section 4(2) of the U.S. Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder,
including Regulation S.





Item
      6.
            Management’s
      Discussion and Analysis or Plan of
Operation.





Certain matters
discussed in this Annual Report may constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995 and as such
may involve risks and uncertainties. These forward-looking statements relate to,
among other things, expectations of the business environment in which the
Company operates, projections of future performance, perceived opportunities in
the market and statements regarding the Company's goals. The Company's actual
results, performance, or achievements expressed or implied in such
forward-looking statements may differ.





The consolidated
balance sheets as at December 31, 2007 and 2006, and the consolidated statements
of operations, cash flows and stockholders’ equity (deficiency) for the fiscal
years ended December 31, 2007 and 2006 have been restated to correct errors
identified by the Company with respect to the accounting treatment for its
credit facility as well as the beneficial conversion feature and deemed dividend
charges associated with its convertible preferred stock. Please refer to Note 1
of the December 31, 2007 consolidated financial statement for further
details.







Overview


The Company
operates its business through several subsidiaries and is classified into two
operating segments;





1) Retail,
and


2)
Commercial.





Wireless Age’s
Retail segment is operated through its subsidiary Wireless Age Communications
Ltd., which is in the business of operating retail cellular and
telecommunications outlets in cities in Western Canada. In addition, the Company
operates its Commercial operating segment through its wholly owned subsidiaries
Wireless Source Distribution Ltd., Prime Wireless Corporation and Marlon
Distribution Ltd.





Wireless Age’s
business operations primarily focus on provision of wireless telecommunications
systems products and service solutions to wholesalers, distributors, retailers
and end-users in Canada. Wireless Age operates 9 retail stores, a corporate
sales force, a rental center and service department focused on selling wireless
solutions. The Company maintains significant business relationships with
SaskTel, the leading full service communications company in Saskatchewan, and
Manitoba Telecom Services in Manitoba. The Company’s presence in the cellular,
land mobile radio, satellite, fixed wireless and battery solutions markets
allows it to bundle a full spectrum of products at the distributor, wholesaler
and retail level across Canada.





Starting late in
fiscal 2006 and ending during fiscal 2007 the Company undertook a process of
reviewing all non-profitable divisions, sub-categories, lines of business or
segments for their long term viability. Through this process the Company came to
the conclusion that the Knowlton Pass business unit (component of the Commercial
operating segment that operates under the name Wireless Works) was non-strategic
in the long run, difficult to fund and placed the unit for sale. On March 1,
2007 the Company disposed of this business unit. For all period described in
this report, the operating results of the Wireless Works business unit have been
classified as discontinued operations. On June 29, 2007, the Company assigned
the financially troubled mmwave business into bankruptcy. The operating results
of mmwave have also been classified as discontinued operations throughout this
report.





The Companyrecorded significant impairment charges
during fiscal 2006.The
fiscal2006 impairment
charge reflectedadjustments to the carrying value of certain commercial segment assets arising
from subsequent eventsoccurringduring the first quarter of fiscal
2007. The condition existed at December 31, 2006 and therefore the Companyadjustedthe carrying value of these assets at
year end.





12


Results
of Operations





Twelve
months ended December 31, 2007 and 2006





Continuing
Operations





The Company
recorded earnings from continuing operations of $1,248,374 during the twelve
month period ended December 31, 2007 compared to a loss of $510,925 in the
comparative period a year ago. Earnings from discontinued operations during
the twelve month period ended December 31, 2007 was $1,642,319 compared to a
loss of $5,567,626 during the twelve month period ended December 31,
2006.  The net income attributable to common shareholders during
fiscal 2007 was $2,217,419 and a net loss of $6,447,931 during fiscal
2006.





The improvement in
results from continuing operations during fiscal 2007 was due to significant
restructuring steps carried out by management. Several unproductive and
unprofitable operations were closed and corporate overhead responsibilities were
realigned and refocused on long term stable business opportunities. Throughout
this process the underlying key retail and distribution operations in western
Canada grew significantly.





Consolidated
Revenues





Consolidated
revenues from continuing operations during the twelve month period ended
December 31, 2007 were $32,682,756 compared to $24,127,026 during the twelve
month period ended December 31, 2006, representing a strong 35% increase in
revenues year over year.





Retail Segment
Revenues





Retail segment
revenues were $17,742,726 for the twelve month period ended December 31, 2007
compared to $13,875,641 for the comparative period ended December 31, 2006. The
Retail revenues are generated from 9 retail stores in Regina, Saskatoon, Selkirk
and Winnipeg, Canada. The year over year growth in revenues was 28% and can be
considered all organic growth.





Retail segment
revenues during the year ended December 31, 2007 and 2006 can be broken down
into the following subcategories:


2007
              
              
              2006Cellular
      hardware, radios and accessories
              
              $
              13,032,602
              
              
              $
              10,098,128Activation
      commissions and residuals
              
              
              4,218,396
              
              
              
              3,457,384Equipment
      rentals
              
              
              491,728
              
              
              
              320,129Total
      Revenue
              
              $
              17,742,726
              
              
              $
              13,875,641


Cellular hardware,
radios and accessories sales are transaction based sales which grew
approximately 29% year over year. Activation commissions are earned when a
customer enter into contracts on a multi year basis with one of our two major
telephone carriers. The Company also receives residual payments from the
carriers based on the usage of the client under contracts sold through our
channel. Activation commissions and residual payments grew by approximately 22%
during fiscal 2007. Equipment rental revenues increased by approximately 54% in
2007.





Management believes
that retail sales of cellular hardware will be stable and continue to rise as
the acceptance and availability of wireless technology continues to grow and as
a portion of the current subscribers upgrade their hardware. Management also
believes that the Company will continue to grow by adding new contracts, however
residual revenues are under pressure from carriers who are taking steps to
improve the profitability of their businesses. Comparatively more growth has
arisen from the sale of new products to our customers than increases in residual
payments.





Commercial Segment
Revenues





Commercial segment
revenues from continuing operations were $14,940,030 for the period ended
December 31, 2007 compared to $10,251,385 for the same period ended December 31,
2006.  The year over year growth of Commercial segment revenues was
46%, sales of products and services increased by approximately 47% while
commission revenues declined by 13%.





13


Sales of the
commercial segment during the year ended December 31, 2007 and 2006 can be
broken down into the following subcategories:





2007
            
            
            2006Sale of
      tangible products
            
            $
            14,803,335
            
            
            $
            10,093,437Activation
      commissions and residual payments
            
            
            136,695
            
            
            
            157,948$
            14,940,030
            
            
            $
            10,251,385





A substantial
portion of the sales growth year over year arose from the sale of prepaid phone
cards and e-Pins.





Consolidated Margin
on Products and Services





Consolidated margin
on products and services from continuing operations during the twelve month
period ended December 31, 2007 was $8,396,602 compared to $6,897,054 for the
comparative period in 2006. Margin as a percentage of sales was 25.7% in 2007
and 28.6% in 2005. Due the Commercial business segment comprising a
comparatively larger proportion of the overall business, the margin as a
percentage of revenue has declined. Management completed a retail acquisition
late in fiscal 2007 in order to take steps to address the declining margin
percentage.





Retail Segment
Margin on Products and Services





Retail segment
margin on products and services during the twelve month period ended December
31, 2007 was $7,267,282 compared to $5,831,721 for the comparative period in
2006. Margin as a percentage of sales was 42.0% in 2006 and 41.0% in 2007.
Retail margins are higher than those in the Commercial segment because they are
affected by residual payments received from carriers that do not have a direct
cost of sale. The year over year reduction in margin as a percentage of revenues
within the Retail segment is reflective of the pressures applied by carriers to
reduce handset prices and hence margins to retailers. A proportionately higher
portion of margins are earned through activation commissions and handset
sales.





Commercial Segment
Margin on Products and Services





Commercial segment
margin on products and services from continuing operations during the twelve
month period ended December 31, 2007 was $1,129,320 compared to $1,065,333 for
the comparative period in 2006. Commercial segment margins are generally less
than the Retail segment margins. The decrease in Commercial segment margin on a
percentage of sales basis is attributable to proportionately more revenue
arising within the Commercial segment from lower margin prepaid cards and
e-Pins.





Consolidated
Operating Expenses





Consolidated
selling and administrative expenses from continuing operations during the twelve
month period ended December 31, 2007 were $6,154,004 compared to $6,026,815
during the twelve month period ended December 31, 2006. Generally selling and
administrative expenses grew commensurately with rising activity levels of the
Company. Most categories of expenses were higher than the previous year with the
exception of professional fees.





Consolidated
selling and administrative expenses, during the twelve month period ended
December 31, 2005 and 2006 are as follows:





2007
            
            
            2006General &
      administrative
            
            $
            1,002,989
            
            
            $
            965,624Occupancy
            
            
            585,826
            
            
            
            543,750Professional
      fees
            
            
            497,826
            
            
            
            726,563Wages &
      benefits
            
            
            4,067,363
            
            
            
            3,490,878Uncollected
      management fees
            
            
            -
            
            
            
            300,000Total
            
            $
            6,154,004
            
            
            $
            6,026,815








14


Wages and benefits
from continuing operations increased from $3,490,878 during the year ended
December 31, 2006 to $4,067,363 during the year ended December 31, 2007. The
increase is attributable to higher levels of activity associated with variable
compensation arrangements within the retail operating segment.





General and
administrative expenses from continuing operations, which consist of travel,
entertainment, automotive, advertising, office and other general miscellaneous
costs, totaled $1,002,989 during the twelve month period ended December 31, 2007
compared to $965,624 in the prior year.





Selling and
administrative expenses in the prior year included a $300,000 special charge
associated with uncollected management fees from Lumonall Inc. (formerly Midland
International Corporation).





Occupancy costs,
which consist of rent, insurance, utilities and maintenance, totaled $585,826
during the twelve month period ended December 31, 2007 compared to $543,750 in
the comparative period in the prior year.





Professional fees,
which consist of legal, accounting, director’s fees, management fees and other
miscellaneous similar costs, totaled $497,826 during the twelve month period
ended December 31, 2007 and $726,563 in the prior year. Professional fees were
reduced through strict cost cutting and monitoring steps taken by management
during the reorganization process.





Amortization
expense during the twelve month period ended December 31, 2007 was $275,410
compared to $258,452 during the comparative period in the prior year.
Amortization expense represents the continued amortization of the Company’s
capital assets acquired in acquisitions and the amortization of fair market
value of the residual premiums acquired in the Retail operating
segment.





During the year
ended December 31, 2006, the Company wrote off its investment in Lumonall, which
consisted of $300,000 in uncollected management fees (such amount included in
selling and administrative expenses) and $129,114 of cash advances over and
above the services provided to Lumonall. On December 31, 2006, the Company sold
4,860,000 Midland common shares for cash proceeds of $48,600. The gain on
disposal has been included in other expenses. During fiscal 2007 the Company
recovered $150,000 from Lumonall and recorded it as a recovery on the note
receivable.





Other expenses
totaled $427,552 during the twelve month period ended December 31, 2006 and
compared to other expenses of $628,776 during the year ended December 31,
2007.





2007
            
            
            2006Interest
      expense
            
            $
            252,021
            
            
            $
            428,825Foreign
      exchange losses
            
            
            50,355
            
            
            
            34,820Financing
      expense
            
            
            326,400
            
            
            
            -(Gain) on
      investments
            
            
            -
            
            
            
            (48,600
            )Share of loss
      of equity accounted investment
            
            
            -
            
            
            
            12,507Total
            
            $
            628,776
            
            
            $
            427,552





Interest expense
decreased from $428,825, during the twelve month period ended December 31, 2006
to $252,021 during the twelve month period ended December 31, 2007. The decrease
is attributable to lower average levels of borrowing under the asset based loan
facility organized during the month of January 2006.





During the year
ended December 31, 2006, the Company recorded foreign exchange gains of $34,820
arising from the translation of Canadian dollar denominated assets and
liabilities into US dollars. During the year ended December 31, 2007 the Company
recorded foreign exchange losses totaling $50,355.





The Company
recorded financing charges of $326,400 (which did not require a cash outlay) in
fiscal 2007. The financing charges are associated with the issuance of 3,200,000
common shares for liquidated damages associated with certain covenant
breaches.





The Company has
recorded a deemed dividend associated with the cancellation of the warrants
($673,274) as a charge after net income attributable to common shareholders and
a financing expense associated with liquidated damages ($326,400) as an other
expense charge.





15


The Company
recorded a deemed dividend on preferred stock of $369,380 during the twelve
month period ended December 31, 2006 representing a charge to income for
reducing the conversion rate of the preferred stock from $0.014 to $0.07 per
share. This non-operating expense arises from Financial Accounting Standards
Board, Emerging Issues Task Force abstracts 98-5 and 00-27 and represents a
non-cash charge to income representing the intrinsic value of the beneficial
conversion option inherent in the August preferred share and warrant
financing.





During fiscal 2006
the Company reversed deferred income taxes of $566,046 recognized during fiscal
2005 due to the Company’s inability to generate net profits in the near term.
During fiscal 2007 the Company recorded deferred income taxes of $240,038
associated with new accounting pronouncements.





The basic net
earnings per share from continuing operations for the twelve month period ended
December 31, 2007 was $0.012. The loss per share from continuing operations was
$0.03 during the twelve month period ended December 31, 2006. The net earnings
(loss) per share attributable to common shareholders (after discontinued
operations, explained below) was $0.047 in fiscal 2007 and $(0.22) in fiscal
2006.





Discontinued
Operations





As of December 31,
2007, the operating results of Knowlton Pass business unit (which operates as
Wireless Works within the Commercial segment) and mmwave have been classified as
discontinued operations. The comparative figures for 2006 have been reclassified
also to reflect the same treatment.





Earnings from
discontinued operations during fiscal 2007 were $1,642,319 compared to a loss of
$5,567,626 in the comparative period in the prior year. The current years
earning primarily arise from the disposition of Knowlton Pass, an entity in
which liabilities exceeded assets and assignment of mmwave into bankruptcy.
Through the disposition of mmwave the Company recorded a significant gain due to
the elimination of an entity with a large net asset deficit. The Company did not
receive any consideration due to the bankruptcy but will record a gain if
amounts are recovered from the bankrupt estate.





Revenues of
discontinued operations during the year ended December 31, 2007 were $982,480
($900,379 from the operations of mmwave and $82,101 from Knowlton Pass) compared
to $9,964,361 ($9,465,821 from mmwave and $498,540 from Knowlton Pass) in the
prior year. Costs and expenses during fiscal 2007 totaled $3,051,733 ($2,351,207
from mmwave operations, $87,234 from Knowlton Pass and $613,292 incurred at the
parent company level but associated with the bankruptcy of mmwave). Costs and
expenses during fiscal 2006 totaled $12,564,431 and broke down as mmwave costs
of $10,903,095 and $1,661,336 of Knowlton Pass costs. During fiscal 2006 the
Company recognized impairment charges of $2,967,556 of which $244,337 were
associated with Knowlton Pass write downs $2,703,219 associated with mmwave
charges and $20,000 impairment of the Company’s investment in Infinity
Capital.





By disposing of
both these business units the Company recorded a gain of $3,711,572 in fiscal
2007. The gains arose from disposing of net asset deficits of $315,800 for
Knowlton Pass and $3,395,772 for mmwave.





Critical
Accounting Policies and Estimates





The discussion and
analysis of results of operations and financial condition are based upon the
consolidated financial statements, which have been prepared in accordance with
accounting principles generally accepted in the United States of America (GAAP).
The preparation of these consolidated financial statements requires management
to make estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities. Management evaluates the estimates on an on-going basis,
including those related to bad debts, inventories, investments, customer
accounts, intangible assets, income taxes, and contingencies and litigation.
Management bases its estimates on historical experience and on various other
assumptions that they believe to be reasonable under the circumstances, the
results of 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. Note 2 of the "Notes to Consolidated Financial Statements" includes
a summary of the significant accounting policies and methods used in the
preparation of the consolidated financial statements. The following is a brief
description of the more significant accounting policies and methods the Company
uses.





16


Acquisitions
and Business Combinations




The Company accounts for acquisitions
and business combinations under the purchase method of accounting. The Company
includes the results of operations of the acquired business from the acquisition
date. Net assets of the companies acquired are recorded at their fair value at
the acquisition date. The excess of the purchase price over the fair value of
net assets acquired are included in goodwill and intangible assets in the
accompanying consolidated balance sheets.





Intangibles,
Goodwill and Other Assets





The Company adopted SFAS No 142,
“Goodwill and Other Intangible Assets”.  SFAS No. 142 does not permit
the amortization of goodwill and indefinite-lived intangible
assets.  Instead, these assets must be reviewed annually (or more
frequently under prescribed conditions) for impairment in accordance with this
statement.  If the carrying amount of the reporting unit’s goodwill or
indefinite-lived intangible assets exceeds the implied fair value, an impairment
loss is recognized for an amount equal to that excess.  Intangible
assets that do not have indefinite lives are amortized over their useful
lives.





The Company
regularly reviews all of its long-lived assets, including goodwill and other
intangible assets, for impairment whenever events or changes in circumstances
indicate that the carrying value may not be recoverable based on undiscounted
cash flow. Factors the Company considers important that could trigger an
impairment review include, but are not limited to, significant underperformance
relative to historical or projected future operating results, significant
changes in the manner of use of the acquired assets or the strategy for the
Company’s overall business, and significant negative industry or economic
trends. When management determines that an impairment review is necessary based
upon the existence of one or more of the above indicators of impairment, the
Company measures any impairment based on a projected discounted cash flow method
using a discount rate commensurate with the risk inherent in our current
business model. Significant judgment is required in the development of projected
cash flows for these purposes including assumptions regarding the appropriate
level of aggregation of cash flows, their term and discount rate as well as the
underlying forecasts of expected future revenue and expense. To the extent that
events or circumstances cause assumptions to change, charges may be required
which could be material.





Residual premiums are amounts paid for
future residual revenue of retail cellular and telecommunications subscriber
business recorded at cost less accumulated amortization.  Amortization
is provided for on a straight-line basis over five years.  Agency fees
are amortized over the term of the related agreement (ten years) on a straight
line basis.





Fair Value of Financial
Instruments




The carrying value
of cash and cash equivalents, receivables, bank indebtedness, accounts payable
and accrued liabilities income taxes payable and customer deposits approximates
fair value because of the short maturity of these instruments.  The
carrying value of long-term debt, obligations under capital lease and due to and
from related parties also approximates fair value.  Unless otherwise
noted, it is management’s opinion that the Company is not exposed to significant
interest, currency or credit risk arising from these financial
instruments.





Investments





Investments are
recorded as available for sale marketable securities, held to maturity
investments or investments over which the Company has the ability to exercise
significant influence.





Available for sale
marketable securities are recorded at fair value and unrealized gains and
losses, net of tax are recorded separately in stockholders’ equity. Realized
gains or losses and other than temporary declines in value are reported in other
income or expense as incurred.





Held to maturity
investments and are recorded at amortized cost. Any unrealized losses which are
considered “other than temporary” are classified as realized losses through
operations.





Investments in
other entities are accounted for using the equity method or cost basis depending
upon the level of ownership and/or the Company's ability to exercise significant
influence over the operating and financial policies of the investee. Investments
of this nature are recorded at original cost and adjusted periodically to
recognize the Company's proportionate share of the investees’ net income or
losses after the date of investment. When net losses from an equity accounted
for investment exceed its carrying amount, the investment balance is reduced to
zero and additional losses are


17


not provided for.
The Company resumes accounting for the investment under the equity method when
the entity subsequently reports net income and the Company's share of that net
income exceeds the share of net losses not recognized during the period the
equity method was suspended. Investments are written down only when there is
clear evidence that a decline in value that is other than temporary has
occurred. When an equity accounted for investee issues its own shares, the
subsequent reduction in the Company's proportionate interest in the investee is
reflected in income as a deemed dilution gain proportionate interest in or loss
on disposition.





Financial
Condition





The financial
condition of the Company has significantly improved during fiscal 2007. The
working capital deficit of approximately $3,600,000 at the beginning of the year
improved to a surplus of almost $900,000 at year end. The stockholders’
deficiency has improved from a deficit of $2,170,739 at the beginning of the
year to equity of $1,191,389. The improvement is the result of the disposal of
Knowlton Pass and mmwave during fiscal 2007. Knowlton Pass was sold and mmwave
was assigned into bankruptcy. Fiscal 2007 has been a year of restructuring and
many of the steps initiated by management have made a favourable impact on the
Company’s financial condition. The Company also made an investment in common
shares of Newlook, its controlling shareholder, which have appreciated in value
and under generally accepted accounting principles the Company carries the
securities at fair value.





The Company’s total
assets increased from $8,208,131 at December 31, 2006 to $11,750,632 at December
31, 2007. The increase in total assets during the year ended December 31, 2007
is attributable to significant increase in current assets, primarily due to
rising activity levels in the remaining restructured business units of the
Company, the increase is also the result of due from related party balances
increasing by approximately $1,500,000.  During the year the Company
and its controlling shareholder renegotiated certain loans that resulted in
additional borrowings, the proceeds of which were advanced to the Company’s
controlling shareholder.





Current assets
increased from $6,296,485 at the end of fiscal 2006 to $8,937,949 at the end of
fiscal 2007. Current assets at December 31, 2006 (which included assets of the
discontinued operations) consisted of cash balance of $285,030, accounts
receivable of $3,654,885, inventories of $1,816,623, work in progress of
$225,549, current portion of due from related of $90,003, prepaid expenses of
$105,163 and assets of discontinued operations of $119,234. During fiscal 2007,
cash balances declined by approximately $181,000, receivables increased by
approximately $277,000, inventory increased by $622,000, work in progress
decreased by approximately $225,000 to zero, due from related parties decreased
by approximately $90,000 to zero, prepaid expenses increased by approximately
$38,000 and the Company disposed of assets of discontinued operations of
approximately $119,000. Most of the movements in these balances arose from
normal business operations. However, the biggest contributor to the increase in
current assets was the Company’s investment in common shares of Newlook. The
Company acquired 2,680,307 common shares and options to acquire a further
900,000 common shares of Newlook for total cash consideration of $1,324,618. At
December 31, 2007 the fair value of the 2,680,307 common shares was $1,919,765
based on the closing share price of CAD $0.71 and the fair value of the options
was $400,552 based on a Black-Scholes valuation model.  Accordingly
the company recorded a $995,699 unrealized gain on marketable securities within
accumulated other comprehensive income.





Capital assets, net
of accumulated depreciation decreased from $1,239,129 at December 31, 2006 to
$726,341 at December 31, 2007. The decrease is the result of capital assets
disposed of associated with mmwave which at December 31, 2006 were classified as
continuing operations assets. During the year the Company expended approximately
$396,000 in capital assets, approximately $104,000 in leasehold improvements for
the 3565 King Road corporate office and approximately $292,000 in the retail
operating segment for store improvements and computer equipment.





Intangible assets
increased from $202,750 at the beginning of the year to $332,116 at the end of
fiscal 2007. The net increase is the result of the acquisition of the Selkirk
retail operation, the purchase price of which was all accounted for as an
increase to intangible assets (being residual payments).





Goodwill associated
with acquisitions that have occurred over the last several years was static at
$241,026 throughout the period.





Assets of
discontinued operations (Knowlton Pass) of $228,741 at the beginning of the year
were sold effective March 1, 2007.





18


Total liabilities
increased from $10,377,587 at December 31, 2006 to $10,577,960 at December 31,
2007. The increase is attributable to a reduction due to the disposition of
mmwave and Knowlton Pass offset by an increase associated with a new $1,513,200
term loan obtained by the Company and its controlling shareholder. During fiscal
2007 current liabilities decreased by approximately $1,800,000 and non-current
liabilities increased by approximately $2,000,000.





Current liabilities
as at December 31, 2006 consisted of $1,983,345 of loans, accounts payable and
accrued liabilities of $6,807,039, deferred revenue and customer deposits of
$169,373, shareholder loans of $178,569, current portion of capital lease
obligations of $166,518 and liabilities of discontinued operations (Knowlton
Pass) of $587,611. Since December 31, 2006, the asset based loans have been
renegotiated with approximately $2,000,000 in debt paid off (but redrawn by
approximately $191,000 through an agreement with Newlook). Accounts payable and
accrued liabilities have increased by approximately $400,000 and deferred
revenue and customer deposits have increased by approximately $37,000. Late in
fiscal 2007 the Company issued a note payable for acquisition of the Selkirk
store of approximately $101,000, shareholder loans of approximately $179,000
have been transferred to discontinue operations and current portion of lease
obligations have been reduced by approximately $138,000. And lastly liabilities
of discontinued operations have reduced by approximately $274,000. Changes in
current liability balances have all been associated with normal business
activity or the disposition of mmwave and Knowlton Pass.





Non-current
liabilities increased by approximately $2,000,000 from $485,132 at the beginning
of the year to $2,511,266 at the end of the year. The increase is attributable
to the new term loan and an increase of approximately $870,000 in potential tax
obligations recorded by the Company through the adoption of FASB Interpretation
No. 48, Accounting for the Uncertainty for Income Taxes (“FIN 48”). Under FIN 48
the Company is obligated to record tax, interest and penalties associated with
tax filing positions that more likely than not would not stand tax authority
scrutiny.





Non-controlling
interest remained unchanged at $1,283 throughout the year. As at December 31,
2007, the Company holds approximately 99.7% of this entity.





The stockholders’
equity/(deficiency) improved from a deficiency of $2,170,739 at the beginning of
the year to a surplus of $1,191,389 at the end of the current year. The
improvement is attributable to:





·
            an increase
      in additional paid-in capital of $190,000 arising from issuances of
      warrants to purchase 2,000,000 common shares issued to former and current
      officers and directors,


·
            a decrease in
      additional paid-capital of $190,000 representing the repurchase of
      warrants to purchase 2,000,000 common shares issued earlier in the
      year,


·
            an increase
      to common stock and additional paid in capital of $673,274 representing
      6,666,667 common shares issued to repurchase 5,000,000 A warrants and
      5,000,000 B warrants,·
            an
      increase to common stock and additional paid in capital of $326,400,
      representing 3,200,000 common shares issued for settlement of financing
      breach,·
            a
      deemed dividend of $673,274 associated with an induced conversion of
      warrants,


·
            an increase
      to common stock and additional paid in capital of $25,715 representing
      357,157 common shares issued for consulting services
    provided,


·
            a $158,963
      reduction of additional paid-in capital arising from the repurchase of
      2,500,000 A warrants and 2,500,000 B
warrants,


·
            an adjustment
      to opening deficit of $625,856 representing the effect of adopting
      accounting pronouncement FIN 48,


·
            an decrease
      in other comprehensive income of $91,560 associated with foreign currency
      translation differences of Canadian dollar denominated consolidating
      financial statements,


·
            an increase
      to other comprehensive income of $995,699 arising from unrealized holding
      gains on marketable securities, and


·
            earnings of
      $2,890,693 for the year.








Liquidity
and Capital Resources





As at December 31,
2007, the Company had current assets of $8,937,949 and current liabilities of
$8,046,694, indicating working capital of $891,255. The Company’s working
capital ratio increased from 0.64 at the beginning of the year to 1.11 at
December 31, 2007. The financial position of the Company has improved
substantially during fiscal 2007 and hence the Company’s liquidity and capital
resources also.





Cash provided by
operating activities from continuing operations amounted to $3,059,587 during
fiscal 2007, primarily as a result of the net earnings adjusted for non cash
items and various changes in operating assets and liabilities including related
party balances. Cash used in investing activities from continuing operations
during the year amounted


19


to $1,827,311,
primarily consisting of cash used to acquire marketable securities, property,
plant and equipment and intangible assets offset by collections from related
parties. Cash used in financing activities from continuing operations during the
year amounted to $1,675,779 and represented movements in loan facilities and the
repurchase of outstanding warrants. The cumulative affect of all these changes
resulted in a net decrease in cash from continuing operations of $443,503 for
the twelve month period ended December 31, 2007.





The Company
experienced a net increase in cash from discontinued operations of $262,574.
Cash used in operating activities from discontinued operations totaled $834,845,
cash used in investing activities of discontinued operations totaled $786,369
and cash provided by financing activities from discontinued operations totaled
$1,883,788.





Overall between
continuing operations and discontinued operations the cash balances of the
Company decreased by $180,929.





Off-Balance Sheet
Arrangements





The Company does
not have any material off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on its financial condition, revenues
or expenses, results of operations, liquidity, capital expenditures or capital
resources.





Contractual
obligation and commitments





The Company has a
variety of contractual debt obligations and other commercial commitments that
represent prospective cash requirements in addition to any capital expenditure
programs. The following is a summarized table of contractual obligations. See
additional details in Notes 9 and 17 to the Consolidated Financial
Statements.





Total
            
            
            Short-term
            
            
            1-3
      Years
            
            
            4-5
      YearsDebt and
      capital  lease obligations(principal
      portion)
            
            $
            62,195
            
            
            $
            29,155
            
            
            $
            29,672
            
            
            $
            3,368Term
      loan
            
            
            1,513,200
            
            
            
            -
            
            
            
            1,513,200
            
            
            
            -Capital lease
      obligations (interest portion)
            
            
            8,179
            
            
            
            4,047
            
            
            
            4,079
            
            
            
            53Tax
      obligations pursuant to FIN 48
            
            
            865,894
            
            
            
            865,894
            
            
            
            -
            
            
            
            -2,449,468
            
            
            
            899,096
            
            
            
            1,546,951
            
            
            
            3,421Premise and
      equipment leases
            
            
            779,800
            
            
            
            307,771
            
            
            
            424,374
            
            
            
            47,655Total
      obligations
            
            $
            3,229,268
            
            
            $
            1,206,867
            
            
            $
            1,971,325
            
            
            $
            51,076




20


















21














WIRELESS AGE COMMUNICATIONS,
INC.




CONSOLIDATED FINANCIAL
STATEMENTS




December 31, 2007 and
2006




(Stated in US
Dollars)














F1


REPORT OF INDEPENDENT REGISTERED
CHARTERED ACCOUNTANTS








To the Stockholders,


Wireless Age Communications,
Inc.





We have audited the accompanying consolidated balance
sheetof Wireless Age
Communications, Inc. anditssubsidiaries(the “Company”)as of December 31, 2007and the related consolidated statements
of operations, cash flows and stockholders’equity for the yearthen ended.  These
consolidated financial statements are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these
consolidated financial
statements based on our audit.





We conducted our auditin accordance with the standards of the
Public Company Accounting Oversight Board (United States).  Those standards require
that we plan and perform an audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements.  An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.  We
believe that our auditprovidesa reasonable basis for our
opinion.





In our opinion, theconsolidated financial statements
referred to above present fairly, in all material respects, the financial
position of Wireless Age Communications, Inc. anditssubsidiaries as of December 31,
2007and the results ofitsoperations andits cash flows for the yearthen ended in conformity with generally
accepted accounting principles in the United States of
America.





The Company is not required to have, nor
were we engaged to perform, an audit of its internal control over financial
reporting.  Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s internal control over financial
reporting.  Accordingly, we express no such
opinion.





The financial statements as at December
31, 2006 were audited by Mintz & Partners LLP who expressed an opinion
without reservation on those statements in their report dated March 30, 2007,
except for the effect of the restatement described in Note 1, which is as
of August 21, 2008.





As described in Note 1, the accompanying
consolidated financial statements for the year ended December 31, 2007 have been
restated.










Toronto,Canada
            
            “Deloitte & Touche
      LLP”March 26, 2008, except for the
      effect of the restatement described in Note 1, which is as of August 21,
      2008
              .
            
            Licensed Public
      Accountants
              Independent
      Registered
              Chartered
      Accountants








F2





REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM








To the Stockholders,


Wireless Age Communications,
Inc.





We have audited the accompanying consolidated balance
sheetof Wireless Age
Communications, Inc. and subsidiaries as of December 31, 2006 and the related
consolidated statements of operations, cash flows and stockholders’deficiency for the yearthen ended.  These
consolidated financial statements are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these
consolidated financial
statements based on our audit.





We conducted our auditin accordance with the standards of the
Public Company Accounting Oversight Board (United States).  Those standards require
that we plan and perform an audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements.  An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.  We
believe that our auditprovidesa reasonable basis for our
opinion.





In our opinion, theconsolidated financial statements
referred to above present fairly, in all material respects, the financial
position of Wireless Age Communications, Inc. and subsidiaries as of December
31, 2006 and the results of their operations and their cash flows for the yearthen ended in conformity with generally
accepted accounting principles in the United States of
America.





As described in Note 1, the accompanying
consolidated financial statement for the year ended December 31, 2006 have been
restated.










Toronto,Canada
            
            “MINTZ & PARTNERS
      LLP”March 30, 2007, except for the
      effect of the restatement described in Note 1, which is as of August 21,
      2008
            
            CHARTERED
      ACCOUNTANTS











F3


WIRELESS AGE COMMUNICATIONS,
INC.


CONSOLIDATED BALANCE
SHEETS


December 31, 2007 and
2006


(Stated in US
Dollars)


2007
                  (Restated)
                
                
                2006
                  (Restated)ASSETSCurrentCash and cash
      equivalents
                
                $
                104,101
                
                
                $
                285,030Receivables – Note
      3
                
                
                3,931,412
                
                
                
                3,654,885Inventory
                
                
                2,438,571
                
                
                
                1,816,623Work in
      progress
                
                
                -
                
                
                
                225,547Marketable securities – Note
      7
                
                
                2,320,317
                
                
                
                -Due from related parties – Note
      4
                
                
                -
                
                
                
                90,003Prepaid
      expenses
                
                
                143,548
                
                
                
                105,163Assets of discontinued operations
      – Note 16
                
                
                -
                
                
                
                119,2348,937,949
                
                
                
                6,296,485Property, plant and
      equipment– Note
      6
                
                
                726,341
                
                
                
                1,239,129Due from related parties – Note
      4
                
                
                1,513,200
                
                
                
                -Intangible assets –Note 8
                
                
                332,116
                
                
                
                202,750Goodwill –Note 8
                
                
                241,026
                
                
                
                241,026Assets of discontinued operations
      –Note
      16
                
                
                -
                
                
                
                228,741$
                11,750,632
                
                
                $
                8,208,131LIABILITIESCurrentLoan and bank indebtedness – Note
      9
                
                $
                -
                
                
                $
                1,983,345Accounts payable and accrued
      liabilities – Note 10
                
                
                7,207,015
                
                
                
                6,807,039Current portion of deferred
      revenue and customer deposits
                
                
                206,258
                
                
                
                169,373Note payable acquisition – Note
      19
                
                
                100,880
                
                
                
                -Due to related parties– Note
      5
                
                
                190,529
                
                
                
                -Current portion of due to
      shareholders – Note 11
                
                
                -
                
                
                
                178,569Obligations under capital leases –
      Note 9
                
                
                28,887
                
                
                
                166,518Liabilities of discontinued
      operations – Note 16
                
                
                313,125
                
                
                
                587,6118,046,694
                
                
                
                9,892,455Deferred revenue and customer
      deposits
                
                
                98,864
                
                
                
                68,765Long term debt – Note
      9
                
                
                1,513,200
                
                
                
                -Obligations under capital leases –
      Note 9
                
                
                33,308
                
                
                
                416,367Tax
    obligations
                
                
                865,894
                
                
                
                -$
                10,557,960
                
                
                $
                10,377,587Commitments and contingencies –
      Note 17Minority
      interest
                
                
                1,283
                
                
                
                1,283STOCKHOLDERS’
      EQUITY (DEFICIENCY)Preferred stock, $0.001 par value
      – Note 1210,000,000 shares authorized,
      (2007: nil issued and outstanding, 2006: 7,142,900)
                
                
                -
                
                
                
                7,143Preferred stock additional paid-in
      capital
                
                
                -
                
                
                
                362,237Common stock, $0.001 par value –
      Note 12100,000,000 shares
      authorized59,473,342 shares outstanding
      (2006:  29,527,918)
                
                
                59,473
                
                
                
                29,528Additional paid-in
      capital
                
                
                11,802,344
                
                
                
                10,596,483Accumulated
      deficit
                
                
                (11,747,170
                )
                
                
                (13,338,733
                )Accumulated other comprehensive
      income
                
                
                1,076,742
                
                
                
                172,6031,191,389
                
                
                
                ( 2,170,739
                )$
                11,750,632
                
                
                $
                8,208,131
     SEE ACCOMPANYING
NOTES
 F4


WIRELESS AGE COMMUNICATIONS,
INC.


CONSOLIDATED STATEMENTS OF
OPERATIONS


For the years ended December 31, 2007
and 2006


(Stated in US
Dollars)





(Note 16)2007
              (Restated)
            
            
            2006
              (Restated)Sales:Sales – products and
      services
            
            $
            28,327,665
            
            
            $
            20,511,694Commission and
      residual revenue
            
            
            4,355,091
            
            
            
            3,615,332Total sales
            
            
            32,682,756
            
            
            
            24,127,026Cost of goods
      sold – products and services
            
            
            24,286,154
            
            
            
            17,229,972Margin on products and
      services
            
            
            8,396,602
            
            
            
            6,897,054Operating
      expensesSelling and
      administrative
            
            
            6,154,004
            
            
            
            6,026,815Amortization
            
            
            275,410
            
            
            
            258,452(Recovery) loss on note receivable
      – Note 4
            
            
            (150,000
            )
            
            
            129,114Earnings from
      operations
            
            
            2,117,188
            
            
            
            482,673Other expenses
      (income)Interest
            
            
            252,021
            
            
            
            428,825Foreign exchange losses
      (gains)
            
            
            50,355
            
            
            
            34,820Financing expense – Note
      14
            
            
            326,400
            
            
            
            -Gain on investments, net – Note
      15
            
            
            -
            
            
            
            (48,600
            )Share of loss of equity accounted
      investment – Note 7
            
            
            -
            
            
            
            12,507Total other
      expenses
            
            
            628,776
            
            
            
            427,552Earnings (loss) before income
      taxes
            
            
            1,488,412
            
            
            
            55,121Income taxes –
      deferred
            
            
            (240,038
            )
            
            
            (566,046
            )Earnings (loss) from continuing
      operations
            
            $
            1,248,374
            
            
            $
            (510,925
            )Earnings (loss) from discontinued
      operations – Note 16
            
            
            1,642,319
            
            
            
            (5,567,626
            )Net income
      (loss)
            
            $
            2,890,693
            
            
            $
            (6,078,551
            )Deemed dividend – Note
      13
            
            $
            -
            
            
            $
            369,380Deemed dividend induced conversion
      of warrants -Note 14
            
            
            673,274
            
            
            
            -Net income (loss) attributable to
      common shareholders
            
            $
            2,217,419
            
            
            $
            (6,447,931
            )Earnings
      (loss) per share:Earnings
      (loss) per share - continuing operations - basic
            
            $
            0.012
            
            
            $
            (0.030
            )Earnings
      per share - continuing operations - diluted
            
            $
            0.012
            
            
            $
            -Earnings
      (loss) per share - discontinued operations - basic
            
            $
            0.035
            
            
            $
            (0.190
            )Earnings
      per share – discontinued operations - diluted
            
            $
            0.035
            
            
            $
            -Net
      earnings (loss) attributable to common shareholders –
basic
            
            $
            0.047
            
            
            $
            (0.220
            )Net
      earnings (loss) attributable to common shareholders –
    diluted
            
            $
            0.047
            
            
            $
            (0.220
            )Weighted
      average number of common shares outstanding:Basic
            
            
            46,784,663
            
            
            
            29,290,200Diluted
            
            
            47,186,449
            
            
            
            38,293,917COMPREHENSIVE
      INCOME (LOSS)Net
      income (loss)
            
            $
            2,890,693
            
            
            $
            (6,078,551
            )Other
      comprehensive income (loss):Unrealized
      holding gain on marketable securities
            
            
            995,699
            
            
            
            -Foreign
      exchange translation gain (loss)
            
            
            (91,560
            )
            
            
            11,604Comprehensive
      income (loss)
            
            $
            3,794,832
            
            
            $
            (6,066,947
            )


SEE ACCOMPANYING
NOTES
 F5


WIRELESS AGE COMMUNICATIONS,
INC.


CONSOLIDATED STATEMENTS OF CASH
FLOWS


For the years ended December 31, 2007
and 2006


(Stated in US
Dollars)





(Note 16)2007
              (Restated)
            
            
            2006
              (Restated)Operating
      ActivitiesNet earnings (loss) from
      continuing operations
            
            $
            1,248,374
            
            
            $
            (510,925
            )Items not involving
      cash:Amortization
            
            
            275,410
            
            
            
            258,452Gain on disposal of
      investments
            
            
            -
            
            
            
            (48,600
            )Financing
      expense
            
            
            326,400Common stock issued for consulting
      services
            
            
            25,715Write off of related party
      loan
            
            
            -
            
            
            
            15,701Warrants issuable under special
      bonus
            
            
            -
            
            
            
            190,000Share of loss of equity accounted
      investment
            
            
            -
            
            
            
            12,507Foreign exchange
      loss/(gain)
            
            
            50,355
            
            
            
            34,820Deferred income tax
      provision
            
            
            -
            
            
            
            566,046Write off of uncollected
      management fees
            
            
            -
            
            
            
            300,000Write off of note
      receivable
            
            
            -
            
            
            
            129,114Changes in operating assets and
      liabilities:Receivables
            
            
            (2,110,477
            )
            
            
            (314,388
            )Inventory
            
            
            (621,948
            )
            
            
            (681,826
            )Prepaid
      expenses
            
            
            (38,385
            )
            
            
            (61,823
            )Accounts payable and accrued
      liabilities
            
            
            3,646,630
            
            
            
            (686,165
            )Deferred revenue and customer
      deposits
            
            
            66,984
            
            
            
            (26,907
            )Increase in due to parent and
      related parties
            
            
            190,529
            
            
            
            61,020Cash provided by (used in)
      operating activities
            
            
            3,059,587
            
            
            
            (762,974
            )Investing
      ActivitiesPurchase of marketable
      securities
            
            
            (1,324,618
            )
            
            
            -Proceeds on disposal of marketable
      securities
            
            
            -
            
            
            
            48,600Additions to intangible
      assets
            
            
            (105,924
            )
            
            
            (43,308
            )Additions to property, plant and
      equipment
            
            
            (396,769
            )
            
            
            (223,654
            )Cash (used in) investing
      activities
            
            
            (1,827,311
            )
            
            
            (218,362
            )Financing
      ActivitiesIssuance of preferred stock and
      warrants, net
            
            
            -
            
            
            
            896,269Repayment of long-term
      debt
            
            
            (51,204
            )
            
            
            (10,950
            )Cash used in purchase of
      outstanding warrants
            
            
            (348,963
            )
            
            
            -Increase (decrease) in bank
      indebtedness
            
            
            (1,275,612
            )
            
            
            1,259,861Cash (used in) provided by
      financing activities
            
            
            (1,675,779
            )
            
            
            2,145,180Increase (decrease) in cash from
      continuing operations:
            
            
            (443,503
            )
            
            
            1,163,844Increase (decrease) in cash from
      discontinued operations (Note 16)
            
            
            262,574
            
            
            
            (1,674,153
            )Decrease in cash during the
      year
            
            
            (180,929
            )
            
            
            (510,309
            )Cash and cash equivalents,
      beginning of the year
            
            
            285,030
            
            
            
            795,339Cash and cash equivalents, end of
      the year
            
            $
            104,101
            
            
            $
            285,030





SEE ACCOMPANYING
NOTES
 F6


The Company paid cash interest of
$252,019 and $401,578 during fiscal years 2007 and 2006
respectively.





The Company did not pay cash income
taxes in either of fiscal years 2007 or 2006.





Non-cash activities:





During 2007 the
Company:




·
            Issued
      warrants to purchase 2,000,000 common shares, valued at
      $190,000.




·
            Issued
      2,950,000 common shares upon the conversion of 2,950,000 Series A
      preferred shares.




·
            Issued
      16,771,600 common shares upon the conversion of 4,192,900 Series A
      preferred shares.




·
            Issued
      6,666,667 common shares, valued at $673,274, to cancel warrants to
      purchase 10,000,000 common shares.




·
            Issued
      3,200,000 common shares, valued at $326,400, to settle liquidated damages
      for certain breaches pursuant to a financing
  agreement.




·
            Issued
      357,157 common shares, valued at $25,715 for consulting services
      provided.




·
            Acquired
      a vehicle valued at $44,819 through a capital lease
      obligation.




·
            Obtained
      a term loan of $1,513,200 the proceeds of which were transferred to the
      Company’s controlling shareholder.





During 2006 the
Company:





·
            Issued 49,729 shares of its common
      stock to acquire additional retail business
    operations.





·
            Amortized $17,850 for common
      shares issued for under a consulting contract in previous
      year.





·
            Acquired property, plant and
      equipment of $484,393 through capital lease
      obligations.





·
            Issued 357,143 shares of its
      common stock, valued at $50,000 and warrants to purchase 14,286 common
      shares, valued at $2,000, as brokers fees associated with a
      financing.























SEE ACCOMPANYING
NOTES
 F7





WIRELESS AGE COMMUNICATIONS,
INC.


CONSOLIDATED STATEMENTS OF STOCKHOLDERS’
EQUITY (DEFICIENCY)


For the years ended December 31, 2007
and 2006


(Stated in US
Dollars)





Common
Stock
            
            
            Preferred
    StockNumber
            
            
            Par Value
            
            
            Additional
              Paid-in
              Capital
            
            
            Number
            
            
            Par Value
            
            
            Additional
              Paid-in
    Capital
            
            
            Accumulated Other Comprehensive
      Income
            
            
            Deficit
            
            
            Total
              (Restated)Balance, December 31,
      2005
            
            
            29,121,046
            
            
            $
            29,121
            
            
            $
            9,686,066
            
            
            
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            160,999
            
            
            $
            (6,890,802
            )
            
            $
            2,985,384Capital stock issued to acquire
      additional retail operations
            
            
            49,729
            
            
            
            50
            
            
            
            14,505
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            14,555Capital stock issued as a brokers
      fee
            
            
            357,143
            
            
            
            357
            
            
            
            49,643
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            50,000Preferred stock issued in
      financing, net
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            7,142,900
            
            
            
            7,143
            
            
            
            362,237
            
            
            
            -
            
            
            
            -
            
            
            
            369,380Adjustment to reflect fair value
      of warrants issued in financing, net of issuance
    costs
            
            
            -
            
            
            
            -
            
            
            
            476,889
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            476,889Adjustment to reflect fair value
      of beneficial conversion feature in financing, net of issuance
      costs
            
            
            -
            
            
            
            -
            
            
            
            369,380
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            369,380Other comprehensive
      income
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            11,604
            
            
            
            -
            
            
            
            11,604Deemed
      dividend
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (369,380
            )
            
            
            (369,380
            )Net loss for the
      year
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (6,078,551
            )
            
            
            (6,078,551
            )Balance, December 31,
      2006
            
            
            29,527,918
            
            
            $
            29,528
            
            
            $
            10,596,483
            
            
            
            7,142,900
            
            
            $
            7,143
            
            
            $
            362,237
            
            
            $
            172,603
            
            
            $
            (13,338,733
            )
            
            $
            (2,170,739
            )





SEE ACCOMPANYING
NOTES
 F8


WIRELESS AGE COMMUNICATIONS,
INC.


CONSOLIDATED STATEMENTS OF STOCKHOLDERS’
EQUITY (DEFICIENCY)


For the years ended December 31, 2007
and 2006


(Stated in US
Dollars)





Common
Stock
            
            
            Preferred
    StockNumber
            
            
            Par Value
            
            
            Additional Paid-in
      Capital
            
            
            Number
            
            
            Par
              Value
            
            
            Additional
              Paid-in
              Capital
            
            
            Accumulated
              Other
              Comprehensive
              Income
            
            
            Deficit
            
            
            Total
              Stockholders’
      Equity
              (Restated)Balance, December 31,
      2006
            
            
            29,527,918
            
            
            $
            29,528
            
            
            $
            10,596,483
            
            
            
            7,142,900
            
            
            $
            7,143
            
            
            $
            362,237
            
            
            $
            172,603
            
            
            $
            (13,338,733
            )
            
            $
            (2,170,739
            )Conversion of preferred stock to
      common stock(Note
      12)
            
            
            2,950,000
            
            
            
            2,950
            
            
            
            149,602
            
            
            
            (2,950,000
            )
            
            
            (2,950
            )
            
            
            (149,602
            )
            
            
            -
            
            
            
            -
            
            
            
            -Adjustment arising from issuance
      of warrants(Note 12)
            
            
            -
            
            
            
            -
            
            
            
            190,000
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            190,000Conversion of preferred stock to
      common stock(Note
      12)
            
            
            16,771,600
            
            
            
            16,772
            
            
            
            200,056
            
            
            
            (4,192,900
            )
            
            
            (4,193
            )
            
            
            (212,635
            )
            
            
            -
            
            
            
            -
            
            
            
            -Issuance of common stock for
      cancellation of warrants(Notes 12 and
      14)
            
            
            6,666,667
            
            
            
            6,667
            
            
            
            666,607
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            673,274Issuance of common stock pursuant
      to settlement of financing breach(Note 14)
            
            
            3,200,000
            
            
            
            3,200
            
            
            
            323,200
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            326,400Issuance of common stock for
      consulting services provided
            
            
            357,157
            
            
            
            356
            
            
            
            25,359
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            25,715Deemed dividend induced conversion
      of warrants
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (673,274
            )
            
            
            (673,274
            )Adjustment arising from repurchase
      of warrants associated with financing (Note 12)
            
            
            -
            
            
            
            -
            
            
            
            (158,963
            )
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (158,963
            )Adjustment arising from repurchase
      of warrants associated with officer settlements (Note
      12)
            
            
            -
            
            
            
            -
            
            
            
            (190,000
            )
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (190,000
            )Adjustment arising from adoption
      of FIN 48 (Note 18)
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (625,856
            )
            
            
            (625,856
            )Foreign currency translation
      adjustment
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (91,560
            )
            
            
            -
            
            
            
            (91,560
            )Unrealized holding gain on
      marketable securities
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            995,699
            
            
            
            -
            
            
            
            995,699Net income for the
      year
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            2,890,693
            
            
            
            2,890,693Balance, December 31,
      2007
            
            
            59,473,342
            
            
            $
            59,473
            
            
            $
            11,802,344
            
            
            
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            1,076,742
            
            
            $
            (11,747,170
            )
            
            $
            1,191,389


SEE ACCOMPANYING
NOTES
 F9


WIRELESS AGE COMMUNICATIONS,
INC.


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS


December 31, 2007 and
2006


(Stated in US
Dollars)








Note
1        Nature of
Operations and Basis of Presentation





Wireless Age Communications, Inc. (the
“Company”), through its 99.7% owned subsidiary, Wireless Age Communications Ltd.
(“WACL”) is in the business of operating retail cellular and telecommunications
outlets in cities in western Canada. The Company, through its other wholly owned
subsidiaries Wireless Source Distribution Ltd. (“Wireless Source”), Prime
Wireless Corporation (“Prime Wireless”), Prime Battery Products Limited (“Prime
Battery”) and Marlon Distributors Ltd. (“Marlon”) is in the business of
distributing two-way radio products, prepaid phone cards, wireless accessories
and various battery and ancillary electronics products inCanada.  WACL was acquired on
October 8, 2002, Prime Wireless was acquired on March 13, 2003, Wireless Source
was acquired on September 19, 2003, Marlon was acquired on July 30, 2004 and
Prime Battery was acquired on September 16, 2004. Prior to the acquisition of
WACL, the Company was characterized as a pre-exploration stage company and had
an option to purchase a mining lease in the State ofUtah,United States of America.  This option agreement was
in default and the Company terminated the lease.  Consequently, the
Company is no longer in the mineral and exploration
business.





The Company was incorporated in the
State ofNevadaon November 17, 2000 as Lennoc
Ventures, Inc.  On October 20, 2002, the Company changed its name to
Wireless Age Communications, Inc.





Discontinued
Operations





Theoperating results ofKnowlton Pass Electronics Inc.
(“KnowltonPass”) for the period January 1, 2006 to
March 1, 2007have been
classified as discontinued
operations. In addition the assets and liabilities ofKnowltonPasshave been segregated as assets and
liabilities held for sale at December 31, 2006.KnowltonPassis a network operator providing
wireless connectivity solutions to commercial and municipal
customers.KnowltonPasswas acquired on July 31,
2005.





mmwave Technologies, Inc. (“mmwave”),
which was acquired on March 4, 2005, has also been classified as discontinued
operations.  mmwave was assigned by the Company into bankruptcy on
June 29, 2007. As at December 31, 2007 all mmwave assets and liabilities were
disposed of through the bankruptcy. The assets and liabilities of mmwave were
not segregated as assets and liabilities at December 31, 2006.  mmwave
was a distributor, systems integrator and representative of wireless, microwave
and fibre optic components, test systems and subsystems.





Refer to Note 16 for additional details
of discontinued operations.




Restatement





Theconsolidatedbalance sheets as at December 31, 2007
and 2006, and theconsolidatedstatementsof operations,cash flows and stockholders’ equity
(deficiency)for the fiscal
years ended December 31, 2007and 2006have been restated to correctthe following
errors:





1)In December 2007, the
Companyamended the terms
of its existing line of credit. Under the amended credit facilities, the
Company, together with its controlling shareholder, Newlook, became co-borrowers
of a loan totalling $2,520,000.  The amended facilities included: 1) a
new $1,513,000 (CAD $1,500,000) 18% per annum 3 year term loan; and 2) a
$1,007,000


(CAD $1,000,000) revolving facility. The
assets of the Company remained as collateral for the amended
facilities.  As at December 31, 2007, $1,513,200 was drawn under the
term loan and $nil was drawn under the revolving facility. The Company and
Newlook agreed that the full proceeds of the term loan would be advanced to
Newlook.  The Company did not originallyrecognize the term loan on its
consolidated balance sheet as at December 31, 2007 on the basis that the
proceeds were fully advanced to Newlook. Upon further analysis, the Company
concluded this accounting treatment was incorrect as thisdid not reflect its legal
obligationas a borrower
under the facility.  As a result, the Company
hasrestated its
consolidated balance sheet to reflect its obligation under the term loan with a
corresponding “Due from related parties” balance representing the amount
advanced to Newlook;





F10


2)In 2006 and 2007, the Company recognized
incremental beneficial conversion features inits convertible preferred stock upon the
resolution of certain contingent events that decreased the price into which the
preferred stock could be converted into common stock.  This resulted
in the recognition of deemed dividends of $3,848,714 and $2,515,767 in 2006 and
2007, respectively, which, in total, represented an excess of $5,995,101 over
the proceeds originally ascribed to the conversion feature on its initial
recognition. Upon further review of Emerging Issues Taks Force (“EITF”) Issue
No. 98-5,Accounting for
Convertible Securities with Beneficial Conversion Features or Contingently
Adjustable Conversion Ratios(“EITF 98-5”),the Company determined that the excessshould be reversed
in order to limit the discount assigned to the beneficial conversion feature to
the amountof the
proceeds allocated toit. The impact of this restatement for both
2006 and 2007is to decrease expenses, accumulated deficit, and
additional paid-in-capital.





3) In 2007, the Company issued 6,666,667
common shares to Newlook to cancel 5,000,000 A warrants and 5,000,000 B warrants
(see Note 14), and recognized an expense of $673,274 equal to the difference
between the fair value of the common shares and the carrying value of the
warrants.  The Company has reallocated the expense to accumulated
deficit as the issuance of common shares represents, in substance, a payment
made to induce conversion of the warrants; the Company therefore accounted for
the transaction in a manner similar to that prescribed by EITF Topic D-42,The
Effect on the Calculation of Earnings per Share for the Redemption or Induced
Conversion of Preferred Stock. The impact of this restatement is to
decrease expenses  in 2007.





The quantitative impact of the
misstatements on the December 31, 2007 and December 31, 2006 financial
statements is as summarized below.





2007
            
            
            2006As reported
            
            
            As restated
            
            
            As reported
            
            
            As restatedConsolidated balance
      sheets:Due from related
      parties
            
            
            -
            
            
            
            1,513,200
            
            
            
            -
            
            
            
            -Total
assets
            
            
            10,237,432
            
            
            
            11,750,632
            
            
            
            8,208,131
            
            
            
            8,208,131Long term
    debt
            
            
            -
            
            
            
            1,513,200
            
            
            
            -
            
            
            
            -Total
      liabilities
            
            
            9,044,760
            
            
            
            10,557,960
            
            
            
            10,377,587
            
            
            
            10,377,587Additional paid in
      capital
            
            
            17,797,445
            
            
            
            11,802,344
            
            
            
            14,075,817
            
            
            
            10,596,483Accumulated
      deficit
            
            
            (17,742,271
            )
            
            
            (11,747,170
            )
            
            
            (16,818,067
            )
            
            
            (13,338,733
            )Consolidated statements of
      operations:Deemed dividendrelated to beneficial conversion
      feature of convertible preferred stock
            
            
            2,515,767
            
            
            
            -
            
            
            
            3,848,714
            
            
            
            369,380Financing
      expense
            
            
            999,674
            
            
            
            326,400
            
            
            
            -
            
            
            
            -Deemed dividend – induced
      conversion of warrants
            
            
            -
            
            
            
            673,274
            
            
            
            -
            
            
            
            -Net income before
      tax
            
            
            815,138
            
            
            
            1,488,412
            
            
            
            55,121
            
            
            
            55,121Net income (loss) after tax from
      continuing operations
            
            
            575,100
            
            
            
            1,248,374
            
            
            
            (510,925
            )
            
            
            (510,925
            )Net income (loss) attributable to
      common shareholders
            
            
            (298,348
            )
            
            
            2,217,419
            
            
            
            (9,927,265
            )
            
            
            (6,447,931
            )Earnings (loss) per sharefrom continuing
      operations
            
            
            0.012
            
            
            
            0.012
            
            
            
            (0.017
            )
            
            
            (0.03
            )Earnings (loss) per share
      attributable to common shareholders
            
            
            (0.006
            )
            
            
            0.047
            
            
            
            (0.339
            )
            
            
            (0.220
            )





These restatements did not have a
cumulative effect on the financial statements as of December 31,
2005.


F11
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )





Note
2        Summary of
Significant Accounting Policies





The consolidated financial statements
have been prepared in accordance with accounting principles generally accepted
in theUnited States of
America.





The consolidated financial statements
have, in management’s opinion, been properly prepared within reasonable limits
of materiality and within the framework of the significant accounting policies
summarized below:





Use of
Estimates





The preparation of consolidated
financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosures of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
revenue and expenses during the period. Actual results may differ from these
amounts. The reported amounts subject to significant management estimates are
impairment of assets (including goodwill), receivables, inventory, deferred
revenue, deferred tax assets and tax obligations.





Consolidated
Financial Statements




The consolidated financial statements
include the accounts of the Company, its wholly-owned inactive subsidiaries DB
Sim Holdings Ltd. (“DB Sim”) and 1588102 Ontario Inc. (“1588102”), its wholly
owned operating subsidiaries Prime Wireless, Wireless Source, Prime Battery,
Marlon and its 99.7% owned subsidiary, WACL. The company is incorporated under
the laws of the state ofNevada. DB Sim, WACL and Wireless Source are
incorporated under the laws of theprovinceofSaskatchewan,Canada. Prime Wireless, Prime Battery and
1588102 are incorporated under the laws of theprovinceofOntario,Canada. Marlon is incorporated federally under
the laws ofCanada. All inter-company transactions and
balances have been eliminated.





Inventory




Telecommunications equipment and
accessories inventory is recorded at the lower of cost and net realizable value
with cost being determined by the first-in, first-out
method.





Allowance
for Doubtful Accounts




The
Company records an allowance for doubtful accounts based on specifically
identified amounts that management believes to be uncollectible. The criteria
for allowance provision are determined based on historical experience and the
Company’s assessment of the general financial conditions affecting its customer
base. If the Company’s actual collections experience changes, revisions to the
allowance may be required.





F12
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Property,
Plant and Equipment




Property, plant and equipment are
recorded at cost less accumulated amortization.  Amortization is
provided over estimated useful life of the assets using the following annual
rates:





Computer
      hardware
            30% declining
      balanceComputer
      software
            2 years
      straight-lineEquipment under capital
      lease
            10 years
      straight-lineLeasehold
      improvements
            5 years straight-line
      (shorter
      oflease
      termor 5
      years)Office
      equipment
            10 years
      straight-lineRental
      equipment
            30% declining
      balanceNetwork
      equipment
            30% declining
      balanceVehicles under capital
      lease
            30% declining
      balanceShop tools and service
      equipment
            10 years
      straight-line





Property, plant and equipment are
reviewed for impairment in accordance with Statement of Financial Accounting
Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of
Long-lived Assets.  Under SFAS No. 144, these assets are tested for
recoverability whenever events or changes in circumstances indicate that their
carrying amounts may not be recoverable.  An impairment charge is
recognized for the amount, if any, which the carrying value of the asset exceeds
the fair value.





Investments





Investments are recorded as available
for sale marketable securities, held to maturity investments or investments over
which the Company has the ability to exercise significant
influence.





Available for sale marketable securities
are recorded at fair value and unrealized gains and losses, net of tax are
recorded separately in stockholders’ equity (deficiency) in accumulated other
comprehensive income. Realized gains or losses and other than temporary declines
in value are reported in other income or expense as
incurred.





Held to maturity investments are
recorded at cost.





Investments in other entities are
accounted for using the equity method or cost basis depending upon the level of
ownership and/or the Company's ability to exercise significant influence over
the operating and financial policies of the investee. Investments of this nature
are recorded at original cost and adjusted periodically to recognize the
Company's proportionate share of the investees' net income or losses after the
date of investment. When net losses from an equity accounted for investment
exceed its carrying amount, the investment balance is reduced to zero and
additional losses are not provided for. The Company resumes accounting for the
investment under the equity method when the entity subsequently reports net
income and the Company's share of that net income exceeds the share of net
losses not recognized during the period the equity method was suspended.
Investments are written down only when there is clear evidence that a decline in
value that is other than temporary has occurred. When an equity accounted for
investee issues its own shares, the subsequent reduction in the Company's
proportionate interest in the investee is reflected in income as a deemed
dilution gain proportionate interest in or loss on
disposition.





Acquisitions
and Business Combinations




The Company accounts for acquisitions
and business combinations under the purchase method of accounting. The Company
includes the results of operations of the acquired business from the acquisition
date. Net tangible and intangible assets of the companies acquired are recorded
at their fair value at the acquisition date. The excess of the purchase price
over the fair value of net assets acquired are included as goodwill in the
accompanying consolidated balance sheets.


F13
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Intangibles,
Goodwill and Other Assets





The Company follows SFAS No 142,
“Goodwill and Other Intangible Assets”.  Under SFAS No. 142 goodwill
and indefinite lived intangible assets must be reviewed annually (or more
frequently under prescribed conditions) for impairment in accordance with this
statement.  If the carrying amount of any reporting unit’s goodwill or
indefinite-lived intangible assets exceeds the implied fair value, an impairment
loss is recognized for an amount equal to that excess.  Intangible
assets that do not have indefinite lives are amortized over their useful
lives.





The Company annually reviews all of its
long-lived assets, including goodwill and other intangible assets, for
impairment or whenever events or changes in circumstances indicate that the
carrying value may not be recoverable based on undiscounted cash flows. Factors
the Company considers important that could trigger an impairment review include,
but are not limited to, significant underperformance relative to historical or
projected future operating results, significant changes in the manner of use of
the acquired assets or the strategy for the Company’s overall business, and
significant negative industry or economic trends and the current fair market
value if available. When management determines that an impairment review is
necessary based upon the existence of one or more of the above indicators of
impairment, the Company measures any impairment based on a projected discounted
cash flow method using a discount rate commensurate with the risk inherent in
our current business model. Significant judgement is required in the development
of projected cash flows for these purposes including assumptions regarding the
appropriate level of aggregation of cash flows, their term and discount rate as
well as the underlying forecasts of expected future revenue and expense. To the
extent that events or circumstances cause assumptions to change, charges may be
required which could be material.





Residual premiums, which are amounts
paid for future residual revenue of retail cellular and telecommunications
subscriber business, are carried at cost less accumulated
amortization.  Amortization is provided for on a straight-line basis
over five years.  Agency fees are amortized over the term of the
related agreement (ten years) on a straight line basis.





Fair Value
of Financial Instruments




The
carrying value of cash and cash equivalents, receivables, bank indebtedness,
accounts payable and accrued liabilities, note payable acquisition and customer
deposits approximates fair value because of the short maturity of these
instruments.  The carrying value of long-term debt, obligations under
capital leases and due to and from related parties also approximates fair value
due to the short period of time to maturity.  Unless otherwise noted,
it is management’s opinion that the Company is not exposed to significant
interest, currency or credit risk arising from these financial
instruments.




Capital
Leases




The
Company’s policy is to record leases, which transfer substantially all benefits
and risks incidental to ownership of property, as acquisitions of property and
equipment and to record the incurrences of corresponding obligations as
liabilities. Obligations under capital leases are reduced by rental payments net
of imputed interest.





Income
Taxes




Income taxes are accounted for under the
asset and liability method.  Deferred tax assets and liabilities are
recognized for the expected net tax effects of temporary differences between the
carrying amounts of assets and liabilities for financial reporting and income
tax purposes and net operating loss and credit carry
forwards.  Deferred tax assets and liabilities are measured using the
enacted tax rates expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered or
settled.  The effect on deferred tax assets and liabilities of a
change in tax rate is recognized in income in the period that includes the
enactment date.  The Company records a tax obligation or a valuation
allowance to reduce deferred tax assets to the amount that is more likely than
not to be realized.





F14
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Beginning with the adoption of FASB
Interpretation No. 48, Accounting for
Uncertainty in Income Taxes(“FIN 48”) as of January 1, 2007, the
Company recognizes the effect of income tax positions only if those positions
are more likely than not to be sustained.  Recognized income tax
positions are measured at the largest amount that is greater than 50% likely of
being realized.  Changes in recognition or measurement are reflected
in the period in which a change in judgement occurs, as a result of information
that arises or when a tax position is effectively settled.  Prior to
the adoption of FIN 48, the Company recognized the effect of income tax
positions only if such positions were probable of being
sustained.  The obligation at adoption under FIN 48 has been recorded
as a charge to the deficit. Interest and penalties related to income tax matters
are recognized in income tax expense.





Basic and
Diluted Earnings (Loss) Per Share




The Company reports earnings (loss) per
share in accordance with Statement of Financial Accounting Standards No. 128,
“Earnings Per Share”.  Loss per share is computed using the weighted
average number of shares outstanding during the year.  Diluted
earnings per share include the potentially dilutive effect of outstanding common
stock options and warrants which are convertible to common
shares.  When the loss per share would be anti dilutive this is not
presented.





Foreign Currency
Translation




The functional currency of the Company
is Canadian dollars, which has been translated into US dollars, the reporting
currency, in accordance with Statement of Financial Accounting Standards No. 52
“Foreign Currency Translation”.  Assets and liabilities are translated
at the exchange rate at the balance sheet date and revenue and expenses are
translated at the exchange rate at the date those elements are
recognized.  Any translation adjustments resulting are not included in
determining net income but are included in other comprehensive
income.





Comprehensive
Income




The Company has adopted Statement of
Financial Accounting Standards No. 130, “Reporting Comprehensive
Income”.  Other comprehensive income is comprised of foreign currency
translation adjustments and unrealized gains and losses on available for sale
marketable securities.





Revenue
Recognition




The Company recognizes revenue from the
sale of telecommunications equipment, digital subscriber line equipment,
accessories and other electronics products when the products are delivered and
accepted by the customer and collectability reasonably assured. Activation
commission fees earned from the telephone companies are recognized at the time
of activation by the customer and include the sale of post paid cellular service
contracts, high speed internet and television services. Residual commission fees
are recognized at the time they are earned. The Company receives revenue from
rental contracts for radio equipment and recognizes the revenue upon completion
of the service. The Company receives co-op advertising revenue from the
telephone companies based on the requirement to spend 30% - 60% of the available
co-op advertising allotment. Any amount received under this program is deducted
from advertising expense.





Revenue from long-term contracts for
developing and building telecommunications systems is recognized(in 2006)using the percentage of completion
method where revenue is recorded as costs are incurred, based on actual costs
incurred to date on a contract, relative to the estimated total costs to
complete the contract. Unbilled revenue represents revenue earned in excess
of


amounts billed on uncompleted contracts.
Deferred revenue represents the extent that billings to clients are in excess of
revenue recognized to date. The results reported under the percentage of
completion method are based on management’s estimates of total costs to complete
the various contracts. Should total actual costs be materially higher or lower
than these estimates, adjustment to future results would be
necessary.





F15
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Shipping and
Handling





The
Company follows EITF Issue 00-10, “Accounting for Shipping and Handling Fees and
Costs” (Issue 00-10). Issue 00-10 requires that all amounts billed to customers
related to shipping and handling should be classified as revenues. Our product
costs include amounts for shipping and handling, therefore, we charge our
customers shipping and handling fees at the time the products are shipped or
when services are performed. The cost of shipping products to the customer is
recognized at the time the products are shipped to the customer and our policy
is to classify them as cost of goods sold.





Warranty
Sales and Costs





The Company, through its Retail
operating segment, sells extended warranty plans for certain telecommunications
equipment. It recognizes revenue on a straight line basis over the period in
which the Company is obligated to service the equipment. The Company also defers
certain costs associated with the sale of extended warranty plans and matches
such costs against revenue as it is recognized.





Cash and Cash
Equivalents





Cash and cash equivalents are included
at cost, which approximates market. At December 31, 2007, the Company's cash and
cash equivalents were held primarily by one financial institution. The Company
considers all highly liquid investments with original maturities of three months
or less to be cash equivalents, while those having original maturities in excess
of three months are classified as marketable securities or as long-term
marketable securities.





Advertising
and Marketing Costs





The Company expenses the costs of
advertising and marketing as incurred. The Company incurred $429,092 and
$535,206 of advertising and marketing expenses during the years ending December
31, 2007 and 2006, respectively.





Discontinued
Operations





The Company has followed Statement of
Financial Accounting Standard No. 144 (“SFAS 144”), “Accounting for the
Impairment or Disposal of Long-Lived Assets”. Accordingly, the Company
recognized as discontinued operations the results of 1) theKnowltonPasssubsidiary which was sold on March 1,
2007 and 2) the results of the mmwave subsidiary which was assigned into
bankruptcy on June 29, 2007.





Convertible
Preferred Stock





The Company has followedEITF 98-5 and EITF 00-27, “Application
of Issue No. 98-5 to Certain Convertible Instruments” (“EITF 00-27”),andhas recordeda non-cash charge to income
representing the intrinsic value of the beneficial conversion option inherent in
the preferredstock.





The Company has alsodetermined the relative fair
valuesof the warrantsand the preferred stockand haschargedthe fair valueof the warrants toadditional paid in
capital.





Note
3        Receivables





2007
            
            
            2006Accounts receivable –
      trade
            
            $
            3,976,412
            
            
            $
            3,965,970Allowance for doubtful
      accounts
            
            
            (45,000
            )
            
            
            (311,085
            )$
            3,931,412
            
            
            $
            3,654,885


F16
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Note
4        Due from
Related Parties





Amounts due to or from related parties
arise from advances to or provided by entities with common officers and/or
directors or cross ownership.  The balances may arise by one party
making payment for expenses of the other party.





The Company and Newlook Industries Corp.
(“Newlook”), the 53% parent (Note 14), negotiated a line of credit and term loan
(see Note 9) pursuant to which the Company and Newlook are
co-borrowers.





The indebtedness under the line of
credit and term loan are reflected on the Company’s statement of financial
position and the use of proceeds by Newlook is reflected as a due from related
party amount.





At December 31, 2007, Newlook was
indebted to the Company in the amount of $1,513,200 (CAD$1,500,000) arising from
proceeds of the new term loan being advanced to Newlook.





Amounts due from Newlook attract
interest of 18%, are cross collaterized and have no specific repayment
date.  The Company has classified this balance as a non-current
asset.





At December 31, 2006, the Company’s
former subsidiary mmwave was owed $90,003 by an entity in which the Company’s
former CEO Brad Poulos held a minority interest.  mmwave was assigned
into bankruptcy on June 29, 2007 (Note 16).  Accordingly there is
nothing recorded in respect to this.





Lumonall, Inc.





On December 31, 2005, Lumonall, Inc.
(formerly Midland International Corporation) (“Lumonall”) provided the Company
an 8% promissory note in the amount of $424,734, pursuant to which Lumonall
agreed to repay the note over a one year period with an initial payment of
$100,000 on March 15, 2006, followed by three payments of $108,245 on June 30,
2006, September 30, 2006 and December 31, 2006. Lumonall also agreed to enter
into a General Security Agreement providing a first charge security position on
all of the assets of Lumonall to the Company. According to the terms of the
promissory note, the Company had the option, but not the obligation, to convert
the outstanding principal and interest payment due on each of June 30, 2006,
September 30, 2006 and December 31, 2006 into shares of Lumonall common stock at
$0.035 per share. The Company did not receive any payments under the promissory
note.





Substantial doubt exists regardingLumonall’sability to repay the promissory note,
and therefore the Company fully provided for a loss on the promissory note
during theyear ended
December 31, 2006. In the
event that the Company recovers any amounts it will record a gain in the period
such amount is received. For accounting purposes the Company reflected the
$300,000 portion of the promissory note that reflects unpaid management
feesas a loss from
operationsand the $129,114
portion that reflects cash advances over and above management services provided as a loss within
other expenses.





During fiscal 2007, the Company
recovered $150,000 from Lumonall under the defaulted promissory note and
recorded $150,000 as a gain within other expenses.








Note
5        Due to
Related Parties





At December 31, 2007 $190,529 was owed
by the Company to Newlook.  The amounts owed by the company to Newlook
are revolving and have no specific repayment date.  The Company has
classified related party amounts, unrelated to use of proceeds from the term
loan, as current liabilities.








F17
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Note
6        Property,
Plant and Equipment








2007AccumulatedCost
            
            
            Amortization
            
            
            NetComputer hardware &
      software
            
            
            42,844
            
            
            
            42,844
            
            
            
            -Equipment under capital
      lease
            
            
            166,889
            
            
            
            166,889
            
            
            
            -Leasehold
      improvements
            
            
            966,892
            
            
            
            778,266
            
            
            
            188,626Office
      equipment
            
            
            537,346
            
            
            
            309,078
            
            
            
            228,268Rental and network
      equipment
            
            
            660,742
            
            
            
            413,141
            
            
            
            247,601Vehicles under capital
      lease
            
            
            44,819
            
            
            
            3,318
            
            
            
            41,501Shop tools and service
      equipment
            
            
            48,207
            
            
            
            27,862
            
            
            
            20,345$
            2,467,739
            
            
            $
            1,741,398
            
            
            $
            726,341








2006AccumulatedCost
            
            
            Amortization
            
            
            NetComputer hardware &
      software
            
            $
            651,181
            
            
            $
            586,488
            
            
            $
            64,693Equipment under capital
      lease
            
            
            141,954
            
            
            
            132,138
            
            
            
            9,816Leasehold
      improvements
            
            
            1,023,068
            
            
            
            899,081
            
            
            
            123,987Office
      equipment
            
            
            564,401
            
            
            
            274,843
            
            
            
            289,558Rental and network
      equipment
            
            
            507,492
            
            
            
            277,457
            
            
            
            230,035Vehicles under capital
      lease
            
            
            491,986
            
            
            
            73,798
            
            
            
            418,188Shop tools and service
      equipment
            
            
            154,349
            
            
            
            51,497
            
            
            
            102,852$
            3,534,431
            
            
            $
            2,295,302
            
            
            $
            1,239,129




During fiscal 2007, substantially all of
the vehicles under capital lease were disposed of through the assignment of
mmwave into bankruptcy.





Note 7
            Investments





Available for sale
      securities





During the year ended December 31, 2007,
the Company acquired 2,680,307 common shares and options to acquire a further
900,000 common shares (at CAD $0.40 per share) of its controlling shareholder
Newlook, which is listed on the TSX Venture Exchange under the symbol “NLI”, for
total cash consideration of $1,324,618 (CAD $1,313,063).  A portion of
these securities were acquired from related parties including former directors
and officers and entities having officers and directors in common with the
Company.  At December 31, 2007 the fair value of the 2,680,307 common
shares was $1,919,765 (CAD $1,903,018) based on the closing share price of CAD
$0.71 and the fair value of the options was $400,552 (CAD $397,058) based on a
Black-Scholes valuation model.  Accordingly the company recorded a
$995,699 unrealized gain on marketable securities within accumulated other
comprehensive income.





During September 2005, the Company
acquired 200,000 common shares of Infinity Capital Corporation, representing a
less than 4% ownership interest, for a cash payment of $20,000. Although
Infinity Capital Corporation files reports with the SEC, the shares are not
eligible to trade at this time. At December 31, 2006, the Company determined
that the investment in Infinity Capital Corporation was impaired and accordingly
wrote off its $20,000 investment. The loss was recorded in Impairment Charges
within discontinued operations during fiscal 2006.





F18
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Equity under significant
influence





In 2005, the Company made an investment
in 4,860,000 common shares of Lumonall Inc. (formerly Midland International
Corporation and Azonic Corporation) a publicly traded entity listed on the NASD
over-the-counter-bulletin-board, representing a 15.8% ownership interest. During
the year ended December 31, 2006 the Company recorded sufficient equity losses
to result in a nil carrying value. On December 29, 2006, the Company disposed of
the remaining securities for $48,600 in cash.





The Company treated the Lumonall
investment as an equity investment due to a common officer between both
entities.





The investment was recorded using the
equity method and has been adjusted as follows:





Balance at Dec 31,
      2006
            
            $
            12,507Share of loss of
      Lumonall
            
            
            (12,507
            )Net investment in subsidiary
            
            $
            -





Note
8        Intangible
Assets
and Goodwill





Intangible
      assets


Gross
                Carrying
                Amount
              
              
              Accumulated
                Amortization
              
              
              2007
                NetIntangible assets subjectto
      amortization:Retail
    segment:Residual
      premiums (i)
              
              $
              1,249,344
              
              
              $
              998,942
              
              
              $
              250,402Agency
      fee
              
              
              322,816
              
              
              
              241,102
              
              
              
              81,714Total intangible assetssubject to
      amortization:
              
              
              1,572,160
              
              
              
              1,240,044
              
              
              
              332,116Total intangible
      assets
              
              $
              1,572,160
              
              
              $
              1,240,044
              
              
              $
              332,116Gross
                Carrying
                Amount
              
              
              Accumulated
                Amortization
              
              
              2006
                NetIntangible assets subjectto
      amortization:Retail
    segment:Residual
      premiums
              
              $
              933,640
              
              
              $
              827,852
              
              
              $
              105,788Agency
      fee
              
              
              274,584
              
              
              
              177,622
              
              
              
              96,962Total intangible assetssubject to
      amortization:
              
              
              1,208,224
              
              
              
              1,005,474
              
              
              
              202,750Total intangible
      assets
              
              $
              1,208,224
              
              
              $
              1,005,474
              
              
              $
              202,750





(i)
            On November 1, 2007, the Company
      acquired theretail
      cellular phonebusiness ofG.L. Enns
      Electronics (Note – 19) and assigned the full purchase
      price of$206, 804 tointangible assets(residual premiums) as there was no fair value
      assignable to other assets acquired or liabilities
      assumed.


F19
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


The Company does not have intangible
assets which are not subject to amortization.





Estimated amortization
expense:





For the year ended December 31,
      2008
            
            $
            81,711For the year ended December 31,
      2009
            
            $
            81,711For the year ended December 31,
      2010
            
            $
            66,593For the year ended December 31,
      2011
            
            $
            49,427For the year ended December 31,
      2012
            
            $
            49.427For the year ended December 31,
      2013
            
            $
            3,247




Goodwill





The changes in the carrying amount of
goodwill for the years ended December 31, 2006 and 2007 are as
follows:





Retail
              Segment
            
            
            Commercial
              Segment
            
            
            TotalBalance as of January 1,
      2006
            
            $
            241,026
            
            
            $
            1,226,174
            
            
            $
            1,467,200Goodwill
      acquired
            
            
            -
            
            
            
            -
            
            
            
            -Impairment
      losses
            
            
            -
            
            
            
            (1,226,174
            )
            
            
            (1,226,174
            )Balance as of December 31,
      2006
            
            $
            241,026
            
            
            $
            -
            
            
            $
            241,026Goodwill
      acquired
            
            
            -
            
            
            
            -
            
            
            
            -Impairment
      losses
            
            
            -
            
            
            
            -
            
            
            
            -Balance as of December 31,
      2007
            
            $
            241,026
            
            
            $
            -
            
            
            $
            241,026





In accordance with SFAS No 142,
“Goodwill and Other Intangible Assets” the goodwill and intangible assets are
reviewed for impairment on an annual basis or when facts and circumstances
indicate that an impairment might have occurred. As a result of the Company’s
analyses during fiscal 2006 the goodwill associated with the commercial segment
was determined to be impaired and was written down by $1,226,174 to $nil. The
goodwill impairment was primarily associated with restructuring steps initiated
within the Commercial operating segment.  It was determined by the
Company that the remaining retail segment intangible assets and goodwill were
not impaired and had retained their value and accordingly no further write down
was required.





Note
9        Bank
Indebtedness, Long-Term Debt and Obligations under Capital
Leases





Loan and bank
indebtedness





The Company’s former subsidiary, mmwave,
which was assigned into bankruptcy on June 29, 2007, had a line of credit of
$756,000 (CAD$750,000) with a registered Canadian bank, secured by the accounts
receivable and inventory, of which $305,844 was drawn as of December 31,
2006.  The line of credit was fully repaid prior to date of
bankruptcy.





The Company also had a line of credit of
$1,513,000 (CAD$1,500,000) with an asset based lender, secured by accounts
receivable and inventory of the retail segment and another legal entity within
the commercial segment of which $1,277,398 was drawn on December 31, 2006.Pursuant
to the terms of the financing arrangement the Company discounts receivables at
$0.67 per day per $1,000 – which resulted in an effective interest rate of
approximately 24.6% per annum.


F20
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )





At December 31, 2006 the bank
indebtedness consisted of:





Bank
    overdraft
            
            $
            400,103Bank line of
      credit
            
            
            305,844Asset based line of
      credit
            
            
            1,277,398$
            1,983,345





On December 13, 2007, the Company
amended the terms of its line of credit.  The Company, together with
its controlling shareholder Newlook, obtained a new loan facility totalling
$2,520,000 (CAD$2,500,000).  The amended facility includes; 1) a new
$1,513,000 (CAD$1,500,000), 18% per annum, 3 year term loan and 2) the existing
$1,513,000 (CAD$1,500,000) loan facility was reduced to $1,007,000
(CAD$1,000,000).  The effective annual interest rate on the new
facility was reduced from approximately 24.6% to approximately
17.9%.  There no principal repayments required under the term loan
until maturity but the Company is obligated to pay interest on a monthly basis.
The term loan may be retired 18 months into the term on 90 days notice subject
to a $75,000 prepayment penalty.  The assets of the Company remain as
collateral for the amended facilities.





The Company and Newlook are co-borrowers
under the amended terms of the line of credit. At December 31, 2007, $1,513,200
was drawn under the term loan portion and $Nil under the $1,007,000 revolving
portion of the facility. The full proceeds of the term loan were advanced to
Newlook.





Obligations
under Capital Leases


2007
            
            
            2006Obligations under capital lease to
      Williamson Leasing in monthly payments ranging between $742 (CAD$736) and
      $1,736 (CAD$1,721) including interest at 7.0%.  Service
      vehicles (13) are pledged as security.
            
            $
            -
            
            
            $
            439,340Obligation under capital lease to
      Bodkin Leasing in monthly payments of $582 (CAD$577)
      including interest at 16.7%.  Equipment is pledged as
      security.
            
            
            -
            
            
            
            13,655Obligation under capital lease to
      National Leasing in monthly payments of $393 (CAD$390)
      including interest at 16.2%.  Equipment is pledged as
      security.
            
            
            -
            
            
            
            9,004Obligation under capital lease to
      CIT in monthly payments of $1,324 (CAD$1,312) including interest at
      15.0%.  Equipment is pledged as security.
            
            
            -
            
            
            
            43,497Obligation under capital lease to
      Kempenfelt Capital in monthly payments of $656 (CAD$650)
      including interest at 14.0%.  Equipment is pledged as
      security.
            
            
            -
            
            
            
            16,702Obligation under capital lease to
      National Leasing in monthly payments of $408 (CAD$404)
      including interest at 11.0%.  Equipment is pledged as
      security.
            
            
            -
            
            
            
            15,088Obligation under capital lease to
      National Leasing in monthly payments of $295 (CAD$292)
      including interest at 16.2%.  Equipment is pledged as
      security.
            
            
            6,047
            
            
            
            8,542Obligation under capital lease to
      Alliance Funding in monthly payments of $1,714 (CAD$1,699)
      including interest at 12.5%.  Equipment is pledged as
      security.
            
            
            9,930
            
            
            
            23,827Obligation under capital lease to
      Ingram Bodkin Capital in monthly payments of $735 (CAD$729)
      including interest at 12.5%.  Equipment is pledged as
      security.
            
            
            8,255
            
            
            
            13,229Obligation under capital lease to
      GMAC in monthly payments of $855 (CAD$848) including interest at
      7.4%.  Vehicle is pledged as security.
            
            
            37,963
            
            
            
            -$
            62,195
            
            
            $
            582,885Less: current
      portion
            
            
            (28,887
            )
            
            
            (166,518
            )$
            33,308
            
            
            $
            416,367





F21
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )





Minimum lease payments on capital lease
obligations are as follows:




2008
            
            
            32,9162009
            
            
            13,5092010
            
            
            10,2642011
            
            
            10,2642012
            
            
            3,42170,374Less imputed
      interest
            
            
            (8,179
            )Lease
      obligation
            
            
            62,195Less:  current
      portion
            
            
            (28,887
            )$
            33,308







Note
10      Accounts
Payable and Accrued Liabilities





2007
            
            
            2006Accounts payable –
      trade
            
            $
            6,907,715
            
            
            $
            5,166,756Accrued
      liabilities
            
            
            299,300
            
            
            
            1,640,283$
            7,207,015
            
            
            $
            6,807,039





Note
11      Due to
Shareholders





During fiscal 2005 the Company acquired
mmwave pursuant to which the Company agreed to repay a shareholder loan provided
by the former mmwave shareholders over a two year period.





2007
            
            
            2006Note payable (unsecured) to the
      former shareholders of mmwave repayable in quarterly instalment payments
      of $32,000 (CDN$37,786) including interest at 8% per annum (principal
      CDN$222,997).
            
            $
            162,224
            
            
            $
            178,569162,224
            
            
            
            178,569Less:  current
      portion:
            
            
            ( -
            )
            
            
            (178,569
            )Less amount classified as
      liability of discontinued operations (Note 16)
            
            
            (162,224
            )
            
            
            -$
            -
            
            
            $
            -





The Company has failed to make payments
under the terms of the note. During fiscal 2006 the Company only made partial
payments to a former minority shareholder of mmwave.





During fiscal 2007, the company agreed
to recommence payment of the loan on a monthly basis and agreed with Brad
Poulos, the Company’s former CEO, to reduce his severance obligation by a like
amount.  The Company agreed to repay the loan by $6,361 (CAD$6,306)
per month until fully repaid.  As of December 31, 2007, this
obligation was classified as a liability of discontinued operations (Note
16).





F22
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Note 12
            Capital
      Structure





Common
  Stock





The Company is authorized to issue
      up to 100,000,000 common shares. As of December 31, 2007, there were
      59,473,342 common shares
issued.





Voting Rights





The holders ofcommonstock have one vote per share. Holders
ofcommonstock are not entitled to vote
cumulatively for the election of directors. Generally, all matters to be voted
on by shareholders must be approved by a majority, or, in the case of the
election of directors, by a plurality, of the votes cast at a meeting at which a
quorum is present, voting together as a single class.





Dividends





Holders of common stock will share
ratably in any dividends declared bytheboard of directors. Dividends
consisting of shares of common stock may be paid to holders of shares of common
stock.





Other Rights





Upon the liquidation, dissolution or
winding up ofthe
Company, all holders of
common stock are entitled to share ratably in any assets available for
distribution to holders of shares of common stock. No shares of common stock are
subject to redemption or have preemptive rights to purchase additional shares of
common stock.





Warrants





The following is a summary of
      common stock warrant activity for 2007 and
  2006:


Number of Shares to Purchase under
      Warrants
              
              
              Exercise
    Price
              
              Expiry
  DateBalance, December 31,
      2005
              
              
              150,000
              
              
              $
              2.00Issued
              
              
              14,286
              
              
              $
              0.14
              
              Between August 2,
      20077,500,000
              
              
              $
              0.125
              
              and August 3,
      20117,500,000
              
              
              $
              0.25Cancelled
              
              
              (150,000
              )
              
              $
              2.00Exercised
              
              
              -Balance, December 31,
      2006
              
              
              15,014,286
              
              
              
              
              
              Between August 2,  2007
      and
                August 3,
    2011Issued
              
              
              2,000,000
              
              
              $
              0.15
              
              February 18,
      2010Cancelled
              
              
              (17,000,000
              )
              
              $
              0.125-0.25
              
              Between August 2, 2007and
      August  3,
      2011Expired
              
              
              (14,286
              )
              
              
              0.14Balance, December 31,
      2007
              
              
              -




During fiscal 2007 the Company
repurchased (and cancelled) for common shares as described below all 15,000,000
warrants associated with the 2006 Barron Partners LLP (“Barron Partners”)
financing, repurchased (and cancelled) as described below a total of 2,000,000
warrants issued to Brad Poulos and Glenn Poulos, former officers and directors
of the Company andGary
Hokkanenthe Company’s
current CFO.


F23
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


The Company issued 6,666,667 common
shares to cancel 5,000,000 A warrants and 5,000,000 B warrants and paid $275,000
in cash to repurchase the remaining 2,500,000 A warrants and 2,500,000 B
warrants.




The Company paid $97,500 cash to
repurchase 2,000,000 warrants fromBrad Poulos, Glen Poulos andGary Hokkanen($43,875paid to Brad Poulos, $48,750 to Glenn
Poulos and $4,875 toGary
Hokkanen).





Stock Options





The Company does not have a Stock Option
plan.








Preferred Stock





The Company is
authorized to issue up to 10,000,000 preferred shares. At December 31, 2007,there werenopreferred sharesoutstanding (2006 – 7,142,900 Series A
Preferred Convertible Stock).During fiscal 2007 2,950,000 preferred
shares were converted into 2,950,000 common shares and 4,192,900 preferred
shares were converted into 16,771,600 common shares.





Each share of Series A Preferred
Convertible Stock shall have a par value of $0.001 per
share.





No dividends shall be payable with
respect to the Series A Preferred Convertible Stock. No dividends shall be
payable with respect to the Common stock while the Series A Preferred
Convertible Stock is outstanding. The Common Stock shall not be redeemed while
the Series A Preferred Convertible Stock is outstanding.





The Series A Preferred Convertible Stock
have no voting rights.





Each share of Series A Preferred
Convertible Stock shall be initially convertible into one (1) share of Common
stock at the option of the Holders, at any time.





Note 13
            Deemed
      Dividend on Preferred Stock





On August 3, 2006, theCompany entered into a Preferred Stock
Purchase Agreement (“PSPA”)with Barron Partners, pursuant to which BarronPartnerswas issued $1,000,000 ofSeries Aconvertible preferred stock and warrants
to purchase a total of 15,000,000 common shares.





The convertible preferred stock
was 7,142,900 zero coupon
perpetual preferred shares initially convertible into 7,142,900 common shares.
The face of value of
$1,000,000 was initially
convertible into common stock at$0.14 per share. The warrants
were classified as A
warrants which providedthe right to acquire 7,500,000 common
shares at an initial exercise price of $0.25 per share and B warrants which
providedthe right to acquire 7,500,000 common
shares at an initial exercise price of $0.50 per share. All warrantswere toexpire on August 3,
2011.





Under the terms of the PSPA the
conversion rate of the preferred stock and the exercise price of the warrants was
tobe adjustedbased on whether the Company
metcertain operating
performance criteria. The
criteria were measured
twice, first based on the operating results of fiscal 2006 and second based on
the operating results of fiscal 2007. During fiscal 2006 the initial $0.14 per
share conversion rate on the preferred stock, the initial $0.25 per share
exercise price of the A warrants and the initial $0.50 per share exercise price
of the B warrants,were
adjusted downward as the Company didnot achieve $0.012 pre-tax earnings per
share from continuing operations and excluding non-recurring items
during fiscal 2006. The
adjustment was limited to a
maximum of 50%. The initial (or adjusted) conversion and exercise prices were againsubject to an adjustment if the Company
didnot achieve $0.069
pre-tax earnings per share from continuing operations and excluding
non-recurring items during
fiscal 2007. The adjustment was again limited to 50% based on the 2007
criteria.


F24
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )





The Company recorded adeemed dividend and adjustment to
additional paid-in capitalon issuance of preferred stock of $369,380representing thevalue of theconversion feature of the preferred
stockon date of
issuance. This
non-operating expense arisesfrom EITF 98-5andEITF00-27 and represents a non-cash charge
to income representing the intrinsic value of the beneficial conversion option
inherent in the preferred shares.





During 2007, as described in Note 12,
these preferred shares were converted into common stock of the
Company.





Note
14      Newlook
Industries Corp. Settlement Agreement





During theyearendedDecember 31, 2007, Newlook acquired a portion of
the Company’s securitiesdescribed in Note 13 that had been
issued to Barron Partners.
On June 29, 2007, the Company agreed to accelerate the effects accruing to
Newlook of Wireless Age not attaining the 2007 operating performance targets.
The Company agreed to issueNewlook the following securities as determined under settlement with Newlook
(the Company’s parent):





•
            16,771,600 restricted(as to trading)common shares in exchange for the
      4,192,900 Series A preferred
shares,


•
            6,666,667 restricted common shares
      of in exchange for the cancellation of (i) the A Warrantsto purchase 5,000,000 common
      shares; and (ii) the B Warrants to purchase 5,000,000 common
      shares,


•
            3,200,000 restricted common shares
      in settlement of liquidated damages arising from the composition of
      Wireless Age’s Board.





Following the consummation of this
agreement there remained 2,500,000 A warrants and 2,500,000 B warrants in the
possession of Barron Partners.





Pursuant to the terms of the agreement
governing the issuance of the preferred shares, the Company was obliged to cause
the majority of the members of the Board of Directors to be independent
otherwise liquidated damages of $1,000 of Series A preferred shares would accrue
per day.  The Company was in breach of this term for 112 consecutive
days.  The charges were recorded and settled as described
below.





The Company recognized adeemed dividend(requiring no cash outlay) of $673,274
pursuant to the issuance of 6,666,667 common shares for cancellation of the
warrants and a $326,400 financing expense (also not requiring a cash outlay)
representing 3,200,000 common shares issued as liquidated damages for breaches
associated with not having proper board representation.





The Company has recorded the deemed
dividend associated with the cancellation of the warrants ($673,274) as a charge
after net income to arrive at net income attributable to common shareholders and
the portion associated with liquidated damages ($326,400) as other
expense.






Change in Control




On June 29, 2007, Newlookalsoacquired an additional 3,426,500 shares
of the Company's common stock pursuant to the terms and conditions of a Share
Exchange Agreement (the "Share Exchange Agreement") by and among Newlook and
Bradley Poulos, Brad Poulos Holdings, Glenn Poulos, Glenn Poulos Holdings and
Sylvain LaFreniere.




Through these transactions
onJune 29, 2007, a change
in control of the Company occurred. As a result of entering into the SettlementAgreement and
theShare Exchange
Agreement and certain open
market share acquisitions,
Newlookobtained31,594,767shares of the Company's common stock,
whichat the time
represented53.4% of the
total number of issued and outstanding shares of the Company's common
stock.




F25
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )





Note 15
            (Gain)
      on Investments, Net





2007
            
            
            2006Gain on disposal of Lumonall
      shares (Note 7)
            
            $
            -
            
            
            $
            ( 48,600
            )$
            -
            
            
            $
            ( 48,600
            )





Note 16
            Discontinued
      Operations





During the year ended December 31, 2006
the Company began a process of reviewing all non-profitable divisions,
sub-categories, lines of business or segments for their long term
viability.





Knowlton Pass Electronics
Inc.





Through the review process the Company
came to the conclusion that theKnowltonPassbusiness unit (component of the
Commercial operating segment) was non-strategic in the long run, difficult to
fund and placed the unit for sale. Effective March 1, 2007 the Company sold theKnowltonPassbusiness unit.Theoperating results of theKnowltonPassbusiness unit havethereforebeen classified as discontinued
operations. The comparative figures for 2006 have been reclassified also to
reflect the same treatment. The operating results also include the severance
provisions and costs of certain senior management employees terminated as a
result of the disposal decision.





The summarized operating results of
discontinued operations forKnowltonPassduring the year ended December 31, 2007
and 2006 are as follows:





2007
            
            
            2006Revenues
            
            $
            82,101
            
            
            $
            498,540Costs and
      expenses
            
            
            87,234
            
            
            
            1,661,336Net loss
            
            $
            (5,133
            )
            
            $
            (1,162,796
            )Gain on
      disposal
            
            
            315,800
            
            
            
            -Impairment
      charges
            
            
            -
            
            
            $
            (244,337
            )Gain (loss)
            
            $
            310,667
            
            
            $
            (1,407,133
            )








The Company sold all of the issued and
outstanding shares ofKnowlton Pass toaformer employee of the
Companyin exchange for a
$327,194 (CAD$377,778) five year promissory note and the forgivenessof severance obligations due tothe former
employee(pursuant to the
terms of his termination in September 2006,hewas to receive severancepaymentstotalling approximately $342,000 over a
period of two years and 8 months). The severance was to be satisfied by the
entity that was sold.





F26
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


(i) The gain on disposal of the entity
is summarized below:





Proceeds
      received:Note
    receivable
            
            $
            327,194Reserve for doubtful
      collection
            
            
            (327,194
            )Net proceeds of
      disposal
            
            $
            -Less: net asset
      deficit
            
            
            (315,800
            )Gain on
      disposal
            
            $
            315,800





mmwave Technologies
Inc.





The Company assigned mmwave into
bankruptcy on June 29, 2007. The operating results of mmwave have beenclassifiedas discontinued
operations.





The summarized operating results for
discontinued operations, for the year ended December 31, 2007 and 2006, are as
follows:





2007
            
            
            2006Revenues
            
            $
            900,379
            
            
            $
            9,465,821Costs and
      expenses
            
            
            2,964,499
            
            
            
            10,903,095Net loss
            
            $
            (2,064,120
            )
            
            $
            (1,437,274
            )Gain on
      disposal
            
            
            3,395,772
            
            
            
            -Impairment
      charge
            
            
            -
            
            
            
            (2,723,219
            )Gain (loss)
            
            $
            1,331,652
            
            
            $
            (4,160,493
            )





In addition, during the year ended
December 31, 2007, the Company incurred expenses of $613,292 associated with the
mmwave discontinued operations.





(ii) The gain on bankruptcy of the
entity is summarized below:





Proceeds
      received
            
            $
            -Less: net asset
      deficit
            
            $
            (3,395,772
            )Gain on
      disposal
            
            $
            3,395,772





At December 31, 2007 the Company
classified a severance accrual of $313,125 for the Company’s former CEO and
President of mmwave as liabilities of discontinued operations.Such amount includes a former
shareholder loan (Note 11).





F27
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Assets and liabilities of discontinued
operationsasatDecember 31, 2007 and 2006are summarized as
follows:





2007
            
            
            2006Receivables (net of
      allowance)
            
            $
            -
            
            
            $
            114,714Inventory
            
            
            -
            
            
            
            -Prepaid
      expenses
            
            
            -
            
            
            
            4,520119,234Property, plant and
      equipment
            
            
            -
            
            
            
            228,741Total
assets
            
            $
            -
            
            
            $
            347,975Bank
      indebtedness
            
            $
            -
            
            
            $
            5,686Accounts payable and accrued
      liabilities
            
            
            313,125
            
            
            
            473,771Deferred revenue and customer
      deposits
            
            
            -
            
            
            
            41,103Current portion of long term
      debt
            
            
            -
            
            
            
            67,051Total
      liabilities
            
            $
            313,125
            
            
            $
            587,611








Cashflows of discontinued operations for
theyearendedDecember 31, 2007 and 2006were as follows:





2007
            
            
            2006Net loss from discontinued
      operations
            
            $
            1,642,319
            
            
            $
            (5,567,626
            )Net cash (used in) operating
      activities:
            
            
            (834,845
            )
            
            
            (1,206,212
            )Net cash (used in) investing
      activities:
            
            
            (786,369
            )
            
            
            (867,741
            )Net cash provided by financing
      activities:
            
            
            1,883,788
            
            
            
            399,800Net decrease in cash from
      discontinued operations
            
            $
            262,574
            
            
            $
            (1,674,153
            )





Impairment
Charges





The Company recorded impairment charges
of $2,967,556 (within discontinued operations) during the year ended December
31, 2006.


The fiscal 2006 impairment charge
reflects adjustments to the carrying value of certain commercial segment assets
arising from subsequent events which occurred during the first quarter of fiscal
2007. The condition existed at December 31, 2006 and therefore the Company
recorded impairment charges adjusting the carrying value of these assets at
December 31, 2006. After December 31, 2006, the


F28
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Company began a restructuring process
within its commercial segment as a result of: 1) the restructuring efforts
within its wholly owned subsidiary mmwave, however the Company assigned mmwave
into bankruptcy on June 29, 2007, and 2) the impairment of certain assets of the
Company’s wholly owned subsidiary Knowlton Pass (which operates as Wireless
Works and has been classified as discontinued operations - Note 16). In
addition, the Company recorded certain corporate impairment charges not
associated with the restructuring.





The fiscal 2006 impairment charges
consisted of:





2006mmwave impairment
      charges:Incremental bad debt
      provision
            
            $
            229,162Due from related
      parties
            
            
            246,156Inventory
            
            
            354,161Work in
      progress
            
            
            150,209Prepaid
      expenses
            
            
            88,498Goodwill – Note
      8
            
            
            1,226,174Property, plant and
      equipment
            
            
            408,859Total mmwave impairment
      charges
            
            $
            2,703,219Impairment of carrying value of
      investment in Infinity
              (Note 7)
            
            
            20,000KnowltonPassimpairment
      charges:Incremental bad debt
      provisions
            
            
            29,545Inventory
            
            
            27,036Capital
    assets
            
            
            187,756TotalKnowltonPassimpairment
      charges
            
            $
            244,337Total 2006 impairment
      charges
            
            $
            2,967,556





Note
17      Commitments
and Contingencies





Commitments




The Company leases its premises, certain
operating equipment and automobiles under agreements requiring aggregate minimum
payments over the next five years as follows:





2008
            
            $
            307,7712009
            
            
            195,6432010
            
            
            142,4792011
            
            
            86,2522012
            
            
            47,655$
            779,800





The Company is committed under a
severance obligations to pay Brad Poulos the Company’s former CEO and Chairman a
total of approximately $360,000 over three years and Glenn Poulos a former
director of the Company and an officer of a wholly owned subsidiary a total of
approximately $122,000 over a one year period. These amounts have been fully
provided for in the 2007 financial statements.


F29
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )





The Company’s main operating
subsidiaries have pledged their assets, together with the assets of Newlook, as
security with an asset based lender.  The Company and Newlook are
co-borrowers under the loan agreement.





Contingencies





KnowltonPassLeases





The company is a co-lessor or guarantor
of equipment leases
totaling $51,264 ofKnowltonPass.The Company is obligated to
settle amounts under leases ifKnowltonPassfails to do so.  The
purchaser ofKnowltonPasshas entered into an indemnity agreement
with the Company to indemnify the Company should any losses occur under the
leases.





Note
18       Income
Taxes





The following table summarizes the
significant components of the Company’s deferred tax assets:





2007
            
            
            2006Deferred Tax
      AssetsNon-capital loss
      carryforward
            
            $
            255,000
            
            
            $
            2,071,000Property, plant and
      equipment
            
            
            (21,000
            )
            
            
            (79,000
            )Gross deferred tax
      assets
            
            
            234,000
            
            
            
            1,992,000Valuation allowance for deferred
      tax asset
            
            
            (234,000
            )
            
            
            (1,992,000
            )Total deferred tax
      asset
            
            $
            -
            
            
            $
            -Less: current
      portion
            
            
            -
            
            
            
            -Long-term portion of deferred tax
      asset
            
            $
            -
            
            
            $
            -





The amount taken into income as deferred
tax assets must reflect that portion of the income tax loss carryforwards that
is likely to be realized from future operations.  The Company has
provided an allowance of 100% against all available income tax loss
carryforwards, regardless of their time of expiry. All balances relate to
Canadian transactions.





No
current provision for income taxes has been provided in these financial
statements due to the net loss attributable to common
shareholders.  At December 31, 2007 the Company has net operating loss
carryforwards totalling approximately $708,000 in Canada, the benefit of which
has not been recorded in the financial statements. The net operating loss carry
forwards expire between 2009 and 2016.





Reconciliation’s
between the statutory federal income tax rate and the Company's effective income
tax rate were as follows:





Year
Ended December
31,          2007





Effective
income tax
rate             39%





The
total provision for income taxes differs from that amount which would be
computed by applying the United States income tax rate to income (loss) before
provision for income taxes.





F30
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


The
reasons for these differences are as follows:





Year
Ended December 31, 2007


Expected
      income tax provision
            
            $
            (20,000
            )Timing
      differences
            
            
            20,000Income
      tax provision
            
            $
            -





Effective January 1, 2007, the Company
adopted FIN 48. FIN 48 requires a company to evaluate whether a tax position
taken by the company will “more likely than not” be sustained upon examination
by the appropriate tax authority. It also provides guidance on how a company
should measure the amount of benefit that the company is to recognize in its
financial statements. As a result of the implementation of FIN 48, the Company
recorded $625,856 as a potential tax liability arising from recognized tax
benefits which were accounted for as an increase to the January 1, 2007
accumulated deficit balance.  The Company also recorded a potential
tax liability of $240,038 for the current year.





It is the Company’s policy to recognize
interest and penalties related to income tax matters in income tax expense.
Accrued penalties and interest at December 31, 2007 was $103,906 of which
$37,341 was recognized during 2007.





The Company and its subsidiaries are
subject toU.S.and Canadian federal income tax as well
as provincial and local jurisdictions. Tax years 2004 through 2007 remain open
to examination by tax authorities.





The activity in the accrued liability
for recognized tax benefits for the year ended December 31, 2007 was as
follows:





Recognized tax benefits at
      December 31, 2006
            
            $
            -Gross increases – tax positions in
      prior period on adoption of FIN 48
            
            
            625,856Gross increases – tax positions in
      current period
            
            
            240,038Recognized tax benefits at
      December 31, 2007
            
            $
            865,894





Note
19      Acquisition





G.L. Enns Electronics – Selkirk
Store





On November 1, 2007 to expand its
geographical area of operation, the Company acquired the business assets of G.L.
Enns Electronics – MTS Connect Selkirk store (“Selkirk”) in exchange for
$105,924 (CAD$105,000) paid in cash at closing and a $100,880 (CAD$100,000)
promissory note.  The promissory note is non-interest bearing and will
be paid $25,220 (CAD$25,000) on each of January 31, 2008, February 29, 2008,
March 31, 2008 and April 30, 2008.  The consolidated financial
statements include the operating results of Selkirk effective November 1,
2007.





F31
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


The business combination is accounted
for using the purchase method.  The fair value of the assets acquired
is as follows:





Intangible assets (residual
      premiums)
            
            $
            206,804Net assets acquired at fair
      values
            
            $
            206,804Total
      considerationCash
            
            $
            105,924Note
Payable
            
            
            100,880$
            206,804





The
purchase price was assigned to intangible assets within the retail segment and
represented residual premiums (Note 8).





Note
20      Economic
Dependence





The Company's main source of income is
derived from the sale of cellular phones and its related products and
services.  Its ability to continue viable operations is dependent upon
maintaining its ability to act as an authorized sales agent for two provincial
telephone companies, designated company X and Y herein.  The following
amounts are recorded in accounts receivable and revenue in the financial
statements:





2007
            
            
            2006Accounts
      receivableCompany X
            
            $
            982,309
            
            
            $
            782,624Company Y
            
            
            724,240
            
            
            
            421,469$
            1,706,549
            
            
            $
            1,204,093RevenueCompany X
            
            $
            6,362,759
            
            
            $
            6,372,549Company Y
            
            
            4,219,347
            
            
            
            2,752,706$
            10,582,106
            
            
            $
            9,125,255





Note 21
            Segmented
      Information





SFAS No. 131, “Disclosures about
Segments of anEnterpriseand Related Information,” established
standards for reporting information about operating segments in the Company’s
financial statements. Operating segments are defined as components of an
enterprise about which separate financial information is available that is
evaluated regularly by the chief operating decision maker, or decision making
group, in deciding how to allocate resources and in assessing performance. The
Company operates in two operating segments the retail and commercial
operations.





F32
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )




The following table shows revenues,
profit or loss and identifiable assets by operating segment:


2007
            
            
            2006RevenuesRetail – sale of tangible
      products
            
            $
            13,524,330
            
            
            $
            10,418,257Retail – activation commissions
      and residual payments
            
            
            4,218,396
            
            
            
            3,457,384Commercial – sale of tangible
      products
            
            
            14,803,335
            
            
            
            10,093,437Commercial – activation
      commissions and residual payments
            
            
            136,695
            
            
            
            157,948Consolidated
      revenues
            
            $
            32,682,756
            
            
            $
            24,127,026


Profit or
    LossRetail
            
            $
            2,160,080
            
            
            $
            1,613,783Commercial
            
            
            524,617
            
            
            
            (1,442,039
            )Unallocated
      amounts:Corporate
      costs  (including financing expenses – Note
      14)
            
            
            (1,436,323
            )
            
            
            (682,669
            )Earnings (loss) from discontinued
      operations (Note 16)
            
            
            1,642,319
            
            
            
            (5,567,626
            )Consolidated earnings
      (loss)
            
            $
            2,890,693
            
            
            $
            (6,078,551
            )Deemed dividend related to
      beneficial conversion feature ofconvertible
      preferred stock
            
            $
            -
            
            
            $
            (369,380
            )Deemed dividend induced conversion
      of warrants –Note 14
            
            
            (673,274
            )
            
            
            -Net income (loss) attributable to
      common shareholders
            
            $
            2,217,419
            
            
            $
            (6,447,931
            )AssetsRetail
            
            $
            4,464,017
            
            
            $
            4,898,489Commercial
            
            
            2,573,652
            
            
            
            2,466,105Intangible assets and goodwill -
      retail
            
            
            332,116
            
            
            
            443,776Intangible assets and goodwill -
      commercial
            
            
            -
            
            
            
            -Unallocated corporate
      assets
            
            
            4,380,847
            
            
            
            51,786Assets of discontinued operations
      held for sale
            
            
            -
            
            
            
            347,975Consolidated
      assets
            
            $
            11,750,632
            
            
            $
            8,208,131Capital
      expendituresRetail
            
            
            292,263
            
            
            
            223,654Commercial
            
            
            -
            
            
            
            -Corporate
            
            
            104,506
            
            
            
            -





Note
22      New Accounting
Standards





In July 2006, the FASB issued FASB
Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an
interpretation of FASB Statement No. 109 (FIN 48), which clarifies the
accounting for uncertainty in tax positions. This Interpretation requires that
we recognize in our financial statements, the impact of a tax position, if that
position is more likely than not of being sustained on audit, based on the
technical merits of the position. The provisions of FIN 48 are effective as of
the beginning of our 2007 fiscal year, with the cumulative effect of the change
in accounting principle recorded as an adjustment to opening retained
earnings.As a
result of the implementation of FIN 48 the Company recorded $865,894 as a
potential tax liability arising from recognized tax benefits including accrued
interest and penalties of $103,906.





In September 2006, FASB issued SFAS 157
‘Fair Value Measurements’.  This Statement defines fair value,
establishes a framework for measuring fair value in generally accepted
accounting principles (GAAP), and expands disclosures about fair value
measurements.  This Statement applies under other accounting
pronouncements that require or permit fair value measurements, the Board having
previously concluded in those accounting pronouncements that fair value is the
relevant measurement attribute.  Accordingly, this Statement does not
require any new fair value measurements.  However, for some entities,
the application of this Statement will change current practice.  This
Statement is effective for financial statements issued for fiscal years
beginning after November 15, 2007, and interim periods within those fiscal
years.  Management is currently evaluating the
effect of this pronouncement on financial statements.





F33
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


In September 2006, the SEC issued Staff
Accounting Bulletin No. 108 “Considering the Effects of Prior Year Misstatements
when Quantifying Misstatements in Current Year Financial Statements” (“SAB
108”). SAB 108 provides guidance on how to evaluate prior period financial
statement misstatements for purposes of assessing their materiality in the
current period. If the prior period effect is material to the current period,
then the prior period is required to be corrected. Correcting prior year
financial statements would not require an amendment to prior year financial
statements, but such correction would be made the next time the company files
the prior year financial statements. Upon adoption, SAB 108 allows a one-time
transitional cumulative effect adjustment to retained earnings for correction of
prior period misstatement required under this statement. SAB108 is effective for
fiscal years ending after November 15, 2006. The adoption of SAB108 did not have
a material effect on the Company’s financial statements.





In February 2007, the FASB issued FASB
Statement NO. 159, “The Fair Value Option for Financial Assets and Financial
Liabilities – Including an Amendment of FASB Statement No. 115” (“SFAS 159”).
The fair value option established by SFAS 159 permits all entities to choose to
measure eligible items at fair value at specified election dates. A business
entity will report unrealized gains or loses on items for which the fair value
option has been elected in earnings (or another performance indication if the
business entity does not report earnings) at each subsequent reporting date. The
fair value option: (a) may be applied instrument by instrument, with a few
exceptions, such as investments otherwise accounted for by the equity method;
(b) is irrevocable (unless a new election date occurs); and (c) is applied only
to entire instruments and not to portions of instruments. FASB No. 159 is
effective as of the beginning of the fiscal years beginning after November 15,
2007. The adoption of SFAS 159 is not expected to have a material impact on the
Company’s financial statements.





In December 2007, the FASB issued
Statement of Financial Accounting Standards No. 141 (revised), “Business
Combinations”. The Statement retains the fundamental requirements in Statement
141 that the acquisition method of accounting be used for business combinations,
but broadens the scope of Statement 141 and contains improvements to the
application of this method. The Statement requires an acquirer to recognize the
assets acquired, the liabilities assumed, and any noncontrolling interest in the
acquiree at the acquisition date, measured at their fair values as of that date.
Costs incurred to effect the acquisition are to be recognized separately from
the acquisition. Assets and liabilities arising from contractual contingencies
must be measured at fair value as of the acquisition date. Contingent
consideration must also be measured at fair value as of the acquisition date.
The Statement also changes the accounting for negative goodwill arising from a
bargain purchase, requiring recognition in earnings instead of allocation to
assets acquired. For business combinations achieved in stages (step
acquisitions), the assets and liabilities must be recognized at the full amounts
of their fair values, while under former guidance the entity was acquired in a
series of purchases, with costs and fair values being identified and measured at
each step. The Statement applies to business combinations occurring after
January 1, 2009.




Also in December 2007, the FASB issued
Statement of Financial Accounting Standards No. 160, “Noncontrolling
Interests in Consolidated Financial Statements – an amendment of ARB
No. 51”. The Statement clarifies that a noncontrolling interest in a
subsidiary is an ownership interest in the consolidated entity that should be
reported as equity in the consolidated financial statements. The Statement
establishes a single method of accounting for changes in a parent’s ownership
interest if the parent retains its controlling interest, deeming these to be
equity transactions. Such changes include the parent’s purchases and sales of
ownership interests in its subsidiary and the subsidiary’s acquisition and
issuance of its ownership interests. The Statement also requires that a parent
recognize a gain or loss in net income when a subsidiary is deconsolidated. Italsochanges the way the consolidated income
statement is presented, requiring consolidated net income to be reported at
amounts that include the amounts attributable to both the parent and the
noncontrolling interest, and requires disclosure of these amounts on the face of
the consolidated statement of income. The Statement is effective on
January 1, 2009. The Company does not expect adoption of the Statement to
have a significant effect on its consolidated financial
statements.








F34
 Wireless Age Communications, Inc.
 Notes to the Consolidated Financial
Statements
 December 31, 2007 and 2006
 ( Stated in US
Dollars )


Note
23      Subsequent
Events





mmwave Bankruptcy





The Company is a first position senior
secured debtor to the mmwave bankruptcy.  The Company expects that all
of the affairs of bankruptcy will be concluded during the second quarter of 2008
and will record a recovery (if any) in the statement of operations of the first
half of fiscal 2008. The trustee in bankruptcy has initiated a lawsuit against
Nokia Products Ltd. which has resulted in approximately $319,000 paid to the
court.





Stock Repurchases





During December 2007 the Company
announced it intended to acquire up to 5,000,000 shares under a rule 10b-18
stock repurchase plan during calendar 2008.





Subsequent to December 31, 2007 and as
of the date of financial statement issuance the Company has acquired a total of
778,800 shares of its own common stock for cancellation. Included in this amount
is 179,500 shares recovered from the purchaser of Knowlton Pass which is
recorded as a bad debt recovery during the first quarter of fiscal
2008.





Callmore Acquisition





On March 20, 2008, the Company acquired
all of the business assets of Callmore Communications Inc. for $100,880
(CAD$100,000), $25,220 (CAD$25,000) paid at closing and $25,220 paid in three
consecutive monthly payments beginning April 1, 2008. The Callmore business
assets will be utilized within the Commercial operating
segment.





Exercise of Option to Acquire Newlook
Securities





On March 8, 2008, the Company exercised
an option to acquire 180,000 common shares of Newlook (Note 7) for a cash
payment of $72,634 (CAD$72,000).





Note
24      Comparatives





The
financial statements have been reclassified, where applicable, to conform to the
presentation used in the current year. The changes are due to reclassification
of certain results to discontinued operations. The changes do not affect prior
year earnings.


F35


Item
      8.  Changes in and Disagreements With Accountants on Accounting
      and Financial Disclosure.





Effective January
29, 2008, the firm of Mintz & Partners LLP (“Mintz”), our independent
accountant who audited our consolidated financial statements for our fiscal
years ending December 31, 2006, 2005, 2004 and 2003 was acquired by Deloitte
& Touche LLP (“Deloitte”) and will be carrying on business as
Deloitte.





Our future audit
opinions will be provided by the Deloitte. Previously issued audit opinions will
be re-issued or consent to include previously issued Mintz opinions in
Securities Exchange Commission filings will be provided by
Mintz.  Therefore Mintz effectively resigned as our independent
accountant of record on January 28, 2008.





Mintzs’ report on
the financial statements for the years ended December 31, 2006 and 2005 did not
contain an adverse opinion or disclaimer of opinion, and was not modified as to
uncertainty, audit scope, or accounting principal, except for the following
statement contained in the audit opinion for the year ended December 31,
2006:





“The accompanying
financial statements have been prepared assuming the Company will continue as a
going concern.  At December 31, 2006 the Company has suffered
recurring losses from operations, has a working capital deficit of $3,595,970
and a stockholders’ deficiency which raise substantial doubt about the Company’s
ability to continue as a going concern.  The financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.  Management’s plans in regard to these matters are also
discussed in notes 1 and 22.”








The resignation was
approved by the board of directors and the audit committee.





There were no
disagreements with Mintz, whether or not resolved, on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure, which, if not resolved to Mintz’s satisfaction, would have caused it
to make reference to the subject matter of the disagreement in connection with
its report.





We did not consult
with Deloitte regarding the application of accounting principles to a specific
completed or contemplated transaction, or the type of opinion that might be
rendered on our financial statements and we did not obtain written or oral
advice in reaching a decision as to accounting, auditing or financial reporting
issues.





Item
      8A. Controls and Procedures





The Company's
management is responsible for establishing and maintaining a system of
disclosure controls and procedures (as defined  in  Rule
13a-15(e) and 15d-15(e)  under  the Exchange Act) that is
designed to ensure that  information required to be disclosed by the
Company in the reports that the Company 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.
Disclosure controls  and  procedures  include,
without limitation, controls and  procedures designed to ensure that
information required to be disclosed by an issuer in the reports that it files
or
submits  under  the  Exchange  Act  is  accumulated
and
communicated  to  the  issuer's  management,  including  its
principal executive officer  or  officers  and
principal financial officer or officers,  or  persons
performing similar functions, as appropriate to allow timely decisions regarding
required disclosure.





MANAGEMENT'S ANNUAL
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING





Our management is
responsible for establishing and maintaining adequate internal control over
financial reporting (as defined in Rules 13a-15(f) and 15d-5(f) under the
Exchange Act).  Our management assessed the effectiveness of our
internal control over financial reporting as of December 31, 2007.  In
making  this  assessment,  our management used the
criteria  set  forth  by  the
interpretive guidance
issued  by  the  Securities  and  Exchange  Commission  in
Release  No.  34-55929.   Our management has
concluded that, as of December 31, 2007, our internal control over financial
reporting is effective based on these criteria.  This annual report
does not include an attestation report of the


Company's
registered public accounting firm regarding internal control over financial
reporting.  Management's report was not subject to attestation by the
Company's independent registered public accounting firm pursuant to temporary
rules of  the  Securities  and  Exchange
Commission that permit the Company  to provide only management's
report in this annual report.





Our management,
including the Company's Principal Executive Officer and Principal Financial
Officer, does not expect that our internal control over financial reporting will
prevent all error and all fraud.  A control system, no matter how well
conceived and operated, can provide only reasonable, not absolute, assurance
that the objectives of the control system are met.  Further, the
design of a control system must reflect the fact that there are resource
constraints, and the benefits of controls must be considered relative to their
costs.   Because  of  the  inherent  limitations  in  all  control  systems,  no
evaluation  of  controls can provide absolute assurance that
all control  issues and instances
of  fraud,  if  any,  within  the
Company have been detected.  The Company's internal control over
financial reporting,  however,  are  designed to
provide  reasonable  assurance  that  the  objectives  of  internal
control over financial reporting are met.





In connection with
the restatements of these financial statements, the Audit Committee has
reevaluated certain disclosure controls and procedures and internal control over
financial reporting.  As a result, the Audit Committee is establishing
specific controls related to these matters and will review its conclusions on
controls with qualified internal accounting personnel or third party accounting
experts.  In addition, the Company will provide its accounting staff
with additional training related to generally accepted accounting principles and
financial statement reporting matters.





Item
8B. Other Information




None.


22


PART
III





Item
      9.
            Directors, Executive
      Officers, Promoters and Control Persons; Compliance with Section 16(a) of
      the Exchange Act.





2007
Officer and Director Transitions





On February 4,
2007, the Board appointed John G. Simmonds and Carrie Weiler, the Company’s
Corporate Secretary, to the Board of Directors. On February 13, 2007, David
Valliere and Glenn Poulos resigned as members of the Board of Directors. On
February 19, 2007 John Simmonds was appointed Chairman of the Board of
Directors.  On May 16, 2007, Brad Poulos resigned as a
director.





Pursuant to a
settlement agreement with Newlook whereby Newlook obtained an ownership position
in Wireless Age, Jason Moretto was appointed a director of the Company on June
29, 2007.





The Company’s
current Board of Directors (the “Board”) is comprised of John G. Simmonds, Brian
Usher-Jones, Steven Dulmage, Jason Moretto and Carrie J. Weiler.  Each
director’s term expires upon the election and qualification of their
successor.





The following table
sets forth the names, ages and positions of the directors of the
Company:





Name
            Age
            PositionJohn G.
      Simmonds
            57
            Chairman of
      the BoardSteven
      Dulmage
            65
            DirectorBrian
      Usher-Jones
            62
            DirectorJason
      Moretto
            38
            DirectorCarrie J.
      Weiler
            49
            Director





Biographical Information Regarding
Directors





John G. Simmonds, President, Chief
Executive Officer and Chairman of the Board.Mr. Simmonds has 40 years
experience in the communications sector. He previously served as Chief Executive
Officer and Chairman of the Board from March 13, 2003 until August 31, 2005, at
which time he resigned his position as Chief Executive Officer.  He
resigned as Chairman of the Board and as a director on April 17, 2006 Mr.
Simmonds was appointed Chief Executive Officer of Racino Royale Inc. in June
2006. He also serves as a director. Mr. Simmonds was appointed to the Board of
Directors of Minacs Worldwide, a TSX listed company, in June 2005. He served as
a director until February 2006. Mr. Simmonds was appointed as Director of Eiger
Technology, Inc. (TSX:AXA, OTCBB:ETIFF) and Chief Executive Officer and
President of Newlook Industries Corp. (NLI:TXSV) in September 2005. He continues
to serve as director of Eiger Technology, was appointed CEO in April
2007.  He resigned as an officer of Newlook Industries Corp. in
February 2007 and was reappointed in July 2007.  In September 2004,
Mr. Simmonds was appointed as Chief Executive Officer and Director of Lumonall
Inc. and serves in such capacities today.  Mr. Simmonds served as the
Chief Executive Officer, of TrackPower (OTCBB: TPWR) from 1998 to May 2004. Mr.
Simmonds also served as Chairman and director of TrackPower from 1998 to
November 2006.  In February 2007 Mr. Simmonds was reappointed CEO and
Chairman of the Board of TrackPower. TrackPower is a corporation whose current
business plan and activities are designed around the equine racing and wagering
industries.  Mr. Simmonds has also been involved with several other
companies.  Mr. Simmonds served as Chief Executive Officer, Chairman
and Director of Phantom Fiber Corporation (OTCBB: PHMF), formerly Pivotal
Self-Service Technologies, Inc. and resigned in June of 2004.





Steven Dulmage,
Director.Mr. Dulmage has served as a director of the Company
since his election at the Company's 2004 annual meeting on June 22,
2004.  He previously served as the Chief Financial Officer of African
Gold Group, Inc., a company listed on the Toronto Stock Exchange Venture
Exchange.  Prior to joining African Gold Group, Inc., Mr. Dulmage
served as a business consultant from January 2003 through April 2003, as a sales
agent of the Equigenesis Corporation from December 1999 through December 2002,
and as a sales agent for Mantum Corporation from November 1996 until December
1999.  Mr. Dulmage earned a Bachelor of Arts degree at McMaster
University in 1964.  Mr. Dulmage is a C.A. (Chartered Accountant) and
is a member of the Canadian Institute of Chartered Accountants.  Mr.
Dulmage was a director of Travellers Mall.com Inc., a Toronto Stock Exchange
Venture Exchange listed company, from 2000-2004.


23





Brian Usher-Jones,
Director.Mr. Usher-Jones has served as a director of the
Company since May 8, 2003.  He has been a merchant banker since 1995
and was the former President of MB Capital Corporation and Thomson Kernaghan Co.
Ltd., an investment banking firm in Toronto, Ontario.  Mr. Usher-Jones
attained a Bachelor of Commerce degree from Concordia University in
1969.  Mr. Usher-Jones is also a C.A. (Chartered Accountant) and is a
member of the Canadian Institute of Chartered Accountants (1970).  Mr.
Usher-Jones has served as a director of various public companies. Mr.
Usher-Jones currently serves as a director of Xplore Technologies Corp. and has
in the past been a director of Calvalley Petroleum Inc. and Oromonte Resources
Inc.  Brian Usher-Jones, an independent director serving on the Audit
Committee, is an "audit committee financial expert," as such term is defined
under the regulations promulgated by the Securities and Exchange
Commission.  Mr. Usher-Jones also serves as a member of the Board’s
Compensation Committee.





Jason R. Moretto, Director.
Mr. Moretto has been a director of the Company since June 29, 2007. He has also
been a director of Eiger Technology, Inc. since January 5, 2004, Newlook
Industries Corp. since January 5, 2004 and Racino Royale, Inc. since June 13,
2006. Mr. Moretto was previously employed by BMO Nesbitt Burns (now BMO Capital
Markets), a full service investment dealer based in Toronto, Canada from
September of 1997 to February of 2003. From 1995 to 1997, Mr. Moretto was
National Accounting Manager for Universal Concerts Canada (now Live Nation),
Canada’s largest promoter of live music and entertainment and operator of the
Molson Amphitheatre in Toronto.  Prior to that, he practiced as an
accountant in public practice.  He also recently served as a Member of
the Ontario Securities Commission's Small Business Advisory Committee. Mr.
Moretto holds a Bachelor of Commerce degree from the University of Toronto, and
is a Certified General Accountant and Chartered Financial Analyst.





Carrie J. Weiler, Corporate Secretary
and Director.Ms. Weiler was appointed Corporate Secretary of the Company
on May 29, 2003.  Ms. Weiler provides professional public company
corporate secretarial services to various entities. Ms. Weiler is a member of
the Canadian Society of Corporate Secretaries.  Ms. Weiler was
appointed Corporate Secretary of Racino Royale Inc. in September 2006. She has
served as Corporate Secretary of TrackPower, Inc. since 1998.  On
October 15, 2004 Ms. Weiler was appointed Corporate Secretary of Midland
International Corporation (formerly Azonic Corporation) and continues to serve
in such capacity. Ms. Weiler has served as Corporate Secretary of Newlook
Industries Corp. and Eiger Technology Inc. since July 2007 and as a director of
Newlook Industries since July 2007.





Board and Committee
Meetings





Information
concerning the two Committees maintained by the Board is set forth
below.





The Board held
twelve meetings during the 2007 fiscal year.  No director attended
less than 100% of the Board meetings while serving as such director, or less
than 100% of all committee meetings on which he or she served as a committee
member.





The audit and
compensation committees are the standing committees of the Board.  The
fiscal year 2007 and 2008 committees are comprised as follows:





2007
      Audit Committee
            2007
      Compensation CommitteeBrian
      Usher-Jones (Chairman)
            Steven
      Dulmage (Chairman)Steven
      Dulmage
            Brian
      Usher-JonesJason
      Moretto
            Jason
      Moretto





The current
committees are comprised as follows:





2008
      Audit Committee
            2008
      Compensation CommitteeBrian
      Usher-Jones (Chairman)
            Steven
      Dulmage (Chairman)Steven
      Dulmage
            Brian
      Usher-Jones





Mr. Valliere
resigned as a committee member of the audit committee and compensation committee
effective February 13, 2007 when he resigned as a director.  Jason
Moretto was appointed to the audit committee on June 29, 2007.





The audit committee
of the Board (the “Audit Committee”) held four meetings during fiscal
2007.  The Audit Committee’s duties include recommending the Company’s
independent auditors, reviewing the Company’s financial


24


statements,
reviewing any reports or recommendations regarding the adequacy of internal
accounting controls made by the independent auditors, and considering such other
matters with respect to the accounting, auditing and financial reporting
procedures as it may deem appropriate or as may be brought to its
attention.





The Audit Committee
acts under a written charter adopted and approved by the Board on March 26,
2004.  A copy of the Audit Committee Charter was attached as an
Exhibit to the Company’s definitive proxy statement for 2004.  The
Audit Committee is composed of outside directors who are not officers or
employees of the Company or its subsidiaries.  In the opinion of the
Board, these directors are independent of management and free of any
relationship that would interfere with their exercise of independent judgment as
member of this committee.





The compensation
committee of the Board (the “Compensation Committee”) held one meeting during
the 2007 fiscal year.  The Compensation Committee is responsible for
allocating cash compensation and stock options to senior executive officers of
the Company.





Board
of Directors Independence





The Board reviews
the relationships that each director has with the Company and other
parties.  Only those directors who do not have any of the categorical
relationships that preclude them from being independent and who the Board
affirmatively determines have no relationships that would interfere with the
exercise of independent judgment in carrying out the responsibilities of a
director, are considered to be Independent Directors.  The Board has
reviewed a number of factors to evaluate the independence of each of its
members.  These factors include its members' current and historic
relationships with us and our subsidiaries; their relationships with management
and other directors; the relationships their current and former employers have
with us and our subsidiaries; and the relationships between us and other
companies on which our board members are directors or executive
officers.  After evaluating these factors, the Board has determined
that three of its current five members are “independent”.  These
directors are Messrs. Brian Usher-Jones, Jason Moretto and Steven
Dulmage.  Independent members of our Board meet in executive session
without management present, and are scheduled to do so at least two times per
year.  The Board has designated Mr. Usher-Jones as the presiding
director for these meetings.





Shareholder
Communications





The Board believes
that it is important for our shareholders to have a process to send confidential
communications directly to the board as a whole and to the Independent Directors
in particular. Accordingly, shareholders desiring to send a communication to the
Board, or to a specific director, may do so by delivering a letter to the
Secretary of the Company at the Company’s principal offices as set forth on the
cover page to this Amendment to the Annual Report on
Form 10-KSB.  The mailing envelope must contain a clear notation
indicating that the enclosed letter is a “stockholder-board communication” or
“stockholder director-specific” communication.”  All such letters must
identify the author and clearly state whether the intended recipients of the
letter are all members of our Board or certain specified individual
directors.  To the extent indicated as addressed, the Secretary will
observe any requests for confidentiality and forward such correspondence
unopened directly to a specific director.  With respect to
correspondence addressed to the Board as a whole or to a group of directors or a
specific committee, the Secretary will open such communications and make copies,
and then circulate them to the appropriate director or
directors.  Notwithstanding the foregoing, the Company shall reserve
the right to open all correspondence as it believes reasonably necessary to
assure the safety and personal privacy of all directors.





Report
of Audit Committee of the Board of Directors





The Audit Committee
assists the Board in fulfilling its responsibility for oversight of the internal
control, accounting, auditing and financial reporting practices of the
Company.  Specific responsibilities of the Audit Committee
include:




·
            reviewing and
      discussing the audited financial statements with
    management;




·
            discussing
      with the Company’s independent auditors information relating to the
      auditors’ judgments about the quality of the Company’s accounting policies
      and financial reporting practices;




·
            recommending
      to the Board that the Company include the audited financials in its Annual
      Report on Form 10-KSB; and




·
            overseeing
      compliance with the Securities and Exchange Commission requirements for
      disclosure of auditors’ services and
activities.




25







The Committee
regularly meets with management to consider the adequacy of the Company’s
internal controls and the integrity of it financial reporting.  The
Committee discusses these matters with the Company’s independent auditors and
with appropriate Company financial personnel and internal auditors.





The Committee
regularly meets privately with management, the independent auditors and the
internal auditors.  Each of the independent auditors has unrestricted
access to the Committee.





The Committee
retains and, if circumstances warrant, replaces the independent auditors and
regularly reviews their performance and independence from
management.  The Committee also pre-approves all audit and permitted
non-audit services and related fees.





The Board has
adopted a written charter setting out the roles and responsibilities the
Committee is to perform.  The Board has determined that Mr.
Usher-Jones, an independent director serving on the Audit Committee, is an
“audit committee financial expert,” as such term is defined under the
regulations promulgated by the Securities and Exchange
Commission.  Under such regulations, the designation or identification
of a person as an audit committee financial expert does not impose on such
person any duties, obligations or liability that are greater than the duties,
obligations and liability imposed on such person as a member of the audit
committee and the Board in the absence of such designation or identification nor
does the designation or identification of a person as an audit committee
financial expert affect the duties, obligations or liability of any other member
of the audit committee or Board.





Management has
primary responsibility for the Company’s financial statements and the overall
reporting process, including the Company’s system of internal
controls.





Review of Audited Financial
Statements





The Audit Committee
has reviewed the Company’s financial statements for the fiscal year ended
December 31, 2007, as audited by Deloitte & Touche LLP, the Company’s
independent auditors, and has discussed these financial statements with
management.  In addition, the Audit Committee has discussed with
Deloitte & Touche LLP the matters required to be discussed by Statement of
Auditing Standards No. 61, as amended, regarding the codification of
statements on auditing standards.  Furthermore, the Audit Committee
has received the written disclosures and the letter from Deloitte & Touche
LLP required by the Independence Standards Board Standard No. 1 and has
discussed with Deloitte & Touche LLP its independence. In reliance on the
reviews and discussions referred to above, the Audit Committee recommended to
the Board that the audited financial statements for the fiscal year ended
December 31, 2007 be included in the Company’s Annual Report on
Form 10-KSB, for filing with the Securities and Exchange
Commission.





The members of the
Audit Committee are not currently professionally engaged in the practice of
auditing or accounting.  Members of the Audit Committee rely, without
independent verification, on the information provided to them and on the
representations made by management and the independent
accountants.  Accordingly, the Audit Committee’s oversight does not
provide an independent basis to determine that management has maintained
procedures designed to assure compliance with accounting standards and
applicable laws and regulations.  Furthermore, the Audit Committee’s
considerations and discussions referred to above do not assure that the audit of
the Company’s financial statements has been carried out in accordance with
generally accepted auditing standards, that the financial statements are
presented in accordance with generally accepted accounting principles and that
the Company’s independent accountants are in fact “independent.”





AUDIT
COMMITTEE





Brian
Usher-Jones


Steven
Dulmage


Jason
Moretto





26


Executive
Officers





The following table
presents information with respect to our executive officers, as of March 26,
2008.





Name
            Age
            PositionJohn G.
      Simmonds
            57
            Chief
      Executive Officer and PresidentGary N.
      Hokkanen
            52
            Chief
      Financial OfficerCarrie J.
      Weiler
            49
            Corporate
      Secretary





John G. Simmonds, Chief Executive
Officer, President and Chairman of the Board.See
“Biographical Information Regarding Directors” above for information regarding
Mr. Simmonds.





Carrie J. Weiler, Corporate Secretary
and Director.See “Biographical Information Regarding
Directors” above for information regarding Ms. Weiler.





Gary N. Hokkanen,
Chief Financial Officer.Mr. Hokkanen has served as the
Company's CFO since May 29, 2003.  Mr. Hokkanen is an executive level
financial manager with over 10 years experience in public company financial
management.  Mr. Hokkanen holds a Bachelor of Arts degree from the
University of Toronto and is a CMA (Certified Management Accountant) and a
member of the Society of Management Accountants, Ontario.  From
January 2001 to April 2003 Mr. Hokkanen was CFO of IRMG Inc., a Toronto based
financial management consulting firm.  Mr. Hokkanen served as CFO of
Simmonds Capital Limited from July 1998 to January 2001 and served as CFO of
Trackpower Inc. from February 1998 to June 2001.  In May of 2005 Mr.
Hokkanen was reappointed CFO of Trackpower Inc., resigned in August 2006 and was
reappointed in June 2007.  For the period April 1996 to July 1998, Mr.
Hokkanen served as Treasurer of Simmonds Capital Limited. In
November 2007, Mr. Hokkanen was appointed a director and officer of Sagittarius
Capital Corporation (a TSX Venture Exchange capital pool company). He has also
served as CFO for Newlook Industies Corp. (TSX Venture Exchange), Eiger
Technology Inc. (TSX), Lumonall, Inc. (OTCBB) and Racino Royale Inc. (OTCBB)
since July 2007.





Compliance with Section 16(a) of
the Securities Exchange Act of 1934





Section 16(a)
of the Securities Exchange Act of 1934, as amended, requires the Company’s
directors and executive officers, as well as persons beneficially owning more
than 10% of the outstanding Common Stock, to file certain reports of ownership
with the Securities and Exchange Commission within specified time
periods.  Such officers, directors and shareholders are also required
by Securities and Exchange Commission rules to furnish the Company with copies
of all Section 16(a) forms they file.  Based solely on its review
of such forms, all requirements received by the Company, or written
representations from certain reporting persons, the Company believes that
between January 1, 2007 and December 31, 2007, all Section 16(a) filing
requirements applicable to its officers, directors and 10% shareholders were
met.





Code
of Ethics





The Board adopted a
Code of Ethics in fiscal 2004, which applies to the Company’s executive
officers, as well as the executive officers of the Company’s
subsidiaries.





You can obtain
copies of our current committee charters and Code of Ethics by writing to our
Corporate Secretary at 3565 King Road, Suite 102, King City, Ontario L7B 1M3,
who shall provide copies without charge to any person.








Item 10. Executive
Compensation.





The following table
sets forth compensation for each of the past two fiscal years with respect to
each person who served as Chief Executive Officer of the Company and each of the
two most highly-compensated executive officers of the Company, as well as the
two most highly-compensated non-executive officers of the Company, in each case
who earned a total annual salary and bonuses that exceeded
$100,000.


27





Summary
Compensation Table





Annual
      CompensationName
      and Principal Position
            
            Fiscal
      Year Ended Dec 31,
            
            
            Salary
              ($)
            
            
            Bonus
              ($)
            
            
            Stock
      Awards ($)
            
            
            Options
      Awards ($)
            
            
            Non-Equity
      Incentive Plan Compensation
              ($)
            
            
            Non-Qualified
      Deferred Compensation Earnings ($)
            
            
            All
      Other Compensation
              ($)
            
            
            Total
              ($)Bradley J.
      Poulos Chief Executive Officer (1)
            
            
            2007  
      2006
            
            
            $
            85,942
      $161,537
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            $
            11,980
      16,106
            
            
            $
            97,922
      177,643John G.
      Simmonds Chief Executive Officer (2)
            
            
            2007  
      2006
            
            
            $
            172,664
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            $
            8,476 
      14,000
            
            
            $
            181,140
      14,000Gary N.
      Hokkanen
              Chief
      Financial Officer (3)
            
            
            2007 2006
            
            
            $
            123,729
      $143,285
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            $
            7,9838,318
            
            
            $
            131,712
      151,603Carrie J.
      Weiler
              Corporate
      Secretary (4)
            
            
            2007  
      2006
            
            
            $
            78,405
      $60,451
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            $
            8,476
            
            
            $
            86,881
      60,451Allen G.
      Cowie
              President,
      Retail Operations (5)
            
            
            2007  
      2006
            
            
            $
            141,270
      $132,471
            
            
            $
            47,090
      $51,327
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            $
            13,620
      12,212
            
            
            $
            201,980
      196,010David
      MacKinnon
              Chief
      Technology Officer (6)
            
            
            2007  
      2006
            
            
            $
            27,235
      $133,189
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            
            ----------
              ----------
            
            
            $
            ----------
      3,876
            
            
            $
            27,235
      137,065





(1)
            Mr. Poulos
      was appointed the Company’s President on March 4, 2005, in connection with
      the acquisition of mmwave Technologies Inc. On September 12, 2005 the
      Board of Directors appointed Mr. Poulos as President and CEO. Mr. Poulos
      resigned as CEO on February 4, 2007. 2007 salary represents severance
      payments made to Mr. Poulos.





(2)
            Mr. Simmonds
      joined the Company in March 2003, served as CEO until September 12, 2005
      and as Chairman of the Board and a director until April 17,
      2006.  Mr. Simmonds resigned as a director on April 17, 2006.
      Mr. Simmonds was reappointed to the Board of Directors on February 4, 2007
      and was appointed CEO as of the same date. On February 19, 2007, Mr.
      Simmonds was elected Chairman of the Board of
  Directors.





(3)
            Mr. Hokkanen
      joined the Company as CFO on May 29,
2003.





(4)
            Ms. Weiler
      joined the Company as Corporate Secretary on May 29,
  2003.





(5)
            Mr. Cowie
      joined the Company through the acquisition of Wireless Age Communications
      Ltd. (the retail operating segment) in October 2002. Mr. Cowie was
      appointed President of the Retail Operations in October
    2004.





(6)
            Mr. MacKinnon
      joined the Company as Chief Technology Officer on August 1, 2005, through
      the acquisition of Knowlton Pass Electronics Inc. Mr. MacKinnon employment
      was terminated on September 30,
2006.





Option
Grants in 2007 Fiscal Year





The Company made no
option grants in 2007.


28





Outstanding
Equity Awards at the End of Fiscal 2006





Option
      Awards
            Stock
      AwardsName
      and Principal Position
            Number
      of Securities Underlying Unexercised Options (#)
    Exercisable
            Number
      of Securities Underlying Unexercised Options (#)
    Unexercisable
            Equity
      Incentive Plan Awards: Number of Securities Underlying Unexercised
      Unearned Options
              (#)
            Option
      Exercise Price ($)
            Option
      Expiration Date
            Number
      of Shares or Units of Stock That Have Not Vested
              (#)
            Market
      Value of Shares or Units of Stock That Have Not Vested
              ($)
            Equity
      Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights
      That Have Not Vested (#)
            Equity
      Incentive Plan Awards: Market of Payout Value of Unearned Shares, Units or
      Other Rights That Have Not Vested
              ($)John G.
      Simmonds Chief Executive Officer
            None
            None
            None
            None
            None
            None
            None
            None
            NoneGary N.
      Hokkanen
              Chief
      Financial Officer
            None
            None
            None
            None
            None
            None
            None
            None
            NoneCarrie J.
      Weiler
              Corporate
      Secretary
            None
            None
            None
            None
            None
            None
            None
            None
            NoneAllen G.
      Cowie
              President,
      Retail Operations
            None
            None
            None
            None
            None
            None
            None
            None
            None





Compensation
of Directors





Director
      CompensationName
      and Principal Position
            
            Fees
      Earned or Paid in Cash
              ($)
            
            
            Stock
      Awards ($)
            
            
            Options
      Awards ($)
            
            
            Non-Equity
      Incentive Plan Compensation
              ($)
            
            
            Non-Qualified
      Deferred Compensation Earnings ($)
            
            
            All
      Other Compensation
              ($)
            
            
            Total
              ($)Steven
      Dulmage, Director
            
            $
            25,500
            
            
            
            ----------
            
            
            
            ----------
            
            
            
            ----------
            
            
            
            ----------
            
            
            
            ----------
            
            
            $
            25,500Brian
      Usher-Jones, Director
            
            $
            25,500
            
            
            
            ----------
            
            
            
            ----------
            
            
            
            ----------
            
            
            
            ----------
            
            
            
            ----------
            
            
            $
            25,500





Fees





The following fees
were paid to directors who were not employees of the Company during fiscal
2007.  During 2007, all directors received fees for services rendered
on the Board.  Directors who are full-time employees of the Company
receive no additional compensation for serving as directors.  Board
members also are reimbursed for all expenses associated with attending Board or
Committee meetings. Non-employee directors are paid a $20,000 retainer per annum
and meeting fees as follows:





F  Fee
      for each Board meeting
            
            $500F  Fee
      for each telephone meeting
            
            $500Fee for
      each Committee meeting
            
            $500





Compensation
Committee Interlocks





During the fiscal
year 2007, the Compensation Committee consisted of Messrs. Usher-Jones, Dulmage
and Moretto.  Mr. Valliere effectively resigned as a committee member
due to his resignation from the Board of Directors on February 19,
2007.


29





Employment
Arrangements





On July 2, 2007,
Mr. Gary N. Hokkanen, Chief Financial Officer of Wireless Age Communications,
Inc. (the “Company”), agreed to modify his employment arrangement with the
Company, effective July 1, 2007.  Mr. Hokkanen has served as the
Company’s Chief Financial Officer since May of 2003.





The Company
previously reported on a Form 8-K filed on January 4, 2006, that Mr. Hokkanen
was compensated under an Employment Agreement dated December 30, 2005. Under the
terms of this Employment Agreement, Mr. Hokkanen would receive annual
compensation of CAD$175,000. Mr. Hokkanen was also to receive an annual bonus of
CAD$50,000 based on a yet to be determined annual criteria. Mr. Hokkanen’s
Employment Agreement also contained other customary terms and conditions
commensurate with the position.





On July 2, 2007,
Mr. Hokkanen and the Company entered into a Consulting Services Agreement
pursuant to which Mr. Hokkanen agreed to reduce his annual compensation to
CAD$100,000 and provisions for a bonus were rescinded. The initial term of the
Consulting Services Agreement expires June 30, 2009 and if renewed will be
renegotiated at that time. All other terms and conditions remain unchanged. The
Company and Mr. Hokkanen agreed that due to reduced role and compensation he
would not devote all of his time to Company matters. Effective January 1, 2008,
Mr. Hokkanen’s salary was increased to CAD$120,000 and a bonus of 1.25% of
earnings before interest, taxes, depreciation and amortization (“EBITDA”) if
EBITDA exceeds $2,000,000.





On
October 1, 2005, the Company entered into a consulting agreement with Medallion
Corporation, an entity solely owned by Ms. Carrie Weiler, to obtain the part
time corporate secretarial services of Ms. Weiler for a monthly fee of
$5,350.  The contract expired on September 30, 2006 but was revised to
approximately $7,040 (CAD$8,000) per month effective March 1, 2007. Beginning
January 1, 2008 Ms. Weiler salary was increased to CAD$108,000 plus a bonus
calculated as 1.25% of EBITDA if EBITDA exceeds $2,000,000.





On
January 1, 2006, the Company, entered into an Employment Agreement with Mr.
Allen G. Cowie as President of the Company’s wholly owned subsidiaries Wireless
Age Communications Ltd. and Wireless Source Distribution Ltd. (the “Cowie
Employment Agreement”).  Mr. Cowie has served as President of both
companies since October 2004 and previously as Vice-President of Wireless Source
Distribution Ltd. since inception in 2002 and Wireless Age Communications Ltd.
since July 2000.  Under the terms of the Cowie Employment Agreement,
Mr. Cowie will receive annual compensation of CAD$150,000.  Mr. Cowie
is also to receive an annual bonus based on a percentage (between 1% and 2.5%
depending upon achieving certain minimum levels) of EBITDA of Wireless Age
Communications Ltd. and Wireless Source Distribution Ltd.  Mr. Cowie
will also be eligible for an additional bonus of up to 15% of his annual base
salary at the discretion of the CEO based on his performance in general. Mr.
Cowie will receive a monthly car allowance of CAD$1,200. Mr. Cowie will receive
3 weeks vacation and will be eligible for employee benefit plans offered to
other Company personnel.  Mr. Cowie has agreed to the Company's
customary provisions for loyalty, confidentiality and ownership of intellectual
property.  If the Company terminates the employment of Mr. Cowie
without cause, the Company shall pay Mr. Cowie a payment of twelve times his
current monthly base salary, a payment representing his EBITDA bonus earned thus
far and a payment of one month’s salary for every full year of
service.  The Company will have the right at any time to terminate Mr.
Cowie for just cause without having to make such payments if Mr. Cowie is
terminated for just cause or if Mr. Cowie voluntarily resigns or otherwise
voluntarily terminates his agreement with the Company.





The initial term of
Mr. John Simmonds’ Employment Agreement was February 1, 2007 to March 31, 2008
and could be terminated by the Company on 30 days written
notice.  Under the terms of the Employment Agreement, Mr. Simmonds
would receive annual compensation of CAD$200,000 (approximately US$184,000)
beginning February 1, 2007.  Mr. Simmonds’ Employment Agreement
contained other customary terms and conditions commensurate with the position,
including a car allowance, repayment out of pocket expenses and reimbursement
for personal office rent and utilities. Effective January 1, 2008, Mr. Simmonds’
annual salary was increased to CAD$240,000 and a bonus of 2% of EBITDA if EBITDA
exceeds $2,000,000.





Compensation
Committee Report on Executive Compensation





The Compensation
Committee consists of two non-employee directors, Messrs. Usher-Jones and
Dulmage. On February 19, 2007, Mr. Valliere resigned from the Board of Directors
and from the committee as well. The Compensation


30


Committee has the
responsibility for allocation of cash compensation and stock options to senior
executive officers of the Company.





The entire Board
regularly reviews the Compensation Committee decisions relating to executive
compensation.  The Company’s executive compensation policies, as
endorsed by the Compensation Committee, have been designed to provide a balanced
compensation program that will assist the Company in its efforts to attract,
motivate and retain talented executives who the Compensation Committee and
senior management believe are important to the long-term financial success of
the Company.





Compensation
Committee





Steven
Dulmage


Brian
Usher-Jones








Item 11.  
Security Ownership of
Certain Beneficial Owners and Management.





As of December 31,
2007, there were no securities of the Company authorized for issuance under
equity compensation plans.





The following table
sets forth certain information regarding the beneficial ownership of Common
Stock as of March 26, 2008 by (i) each director of the Company,
(ii) each of the Company’s officers named in the Summary Compensation Table
(collectively, the “Named Executive Officers”), (iii) each person who is
known by the Company to be the beneficial owner of more than five percent of the
Company’s outstanding Common Stock, and (iv) all directors and executive
officers as a group.  Except as otherwise indicated below, each person
named has sole voting and investment power with respect to the shares
indicated.





Amount
      and Nature ofBeneficial
      OwnershipName
      and Address of
            
            
            
            Options/Beneficial
      Owner (1)
            
            Shares
            
            Warrants
      (2)
            
            Total
      (2)
            
            Percent
      (2)Steven
      Dulmage
            
            
            0
            
            
            
            0
            
            
            
            0
            
            
            
            *Gary
      Hokkanen
            
            
            16,826
            
            
            
            0
            
            
            
            16,826
            
            
            
            *John
      Simmonds
            
            
            623,600
            
            
            
            0
            
            
            
            623,600
            
            
            
            1.1%Brian
      Usher-Jones
            
            
            887,500
            
            
            
            0
            
            
            
            887,500
            
            
            
            1.5%Carrie
      Weiler
            
            
            0
            
            
            
            0
            
            
            
            0
            
            
            
            *Allen
      Cowie
            
            
            0
            
            
            
            0
            
            
            
            0
            
            
            
            *Jason
      Moretto
            
            
            0
            
            
            
            0
            
            
            
            0
            
            
            
            *Newlook
      Industries Corp.
            
            
            31,594,767
            
            
            
            0
            
            
            
            31,594,767
            
            
            
            53.8%All executive
      officers
              and directors
      as a
              group (7
      persons)(3)
            
            
            1,527,926
            
            
            
            0
            
            
            
            1,527,926
            
            
            
            2.6%(1)
            The mailing
      address for each individual listed herein is c/o Wireless Age
      Communications, Inc. 3565 King Road, Suite 102, King City, Ontario L7B
      1M3(2)
            Includes
      options and warrants exercisable as of the date hereof or within
      60 days hereafter. Holdings of less than 1% are indicated by
      “*”.  Based upon 58,781,842 shares issued and outstanding
      as of March 26, 2008, (excluding any shares issuable under options or
      warrants, except with respect to the beneficial holder thereof as
      indicated in the table above).(3)
            Officers and
      Directors as a group include Brian Usher-Jones, Steven Dulmage, Gary
      Hokkanen, Carrie Weiler, John Simmonds, Jason Moretto and Allen
      Cowie.











31





Changes
in Control





On
June 29, 2007, a change in control of the Company occurred. As a result of
entering into the Settlement and Release and a Share Exchange Agreement with
third parties on June 29, 2007, Newlook owns 31,594,767 shares of the Company's
common stock, which was 53.4% of the total number of issued and outstanding
shares of the Company's common stock at the time.





On
June 29, 2007, Newlook acquired an additional 3,426,500 shares of the Company's
common stock pursuant to the terms and conditions of a Share Exchange Agreement
(the "Share Exchange Agreement") by and among Newlook and Bradley Poulos, Brad
Poulos Holdings, Glenn Poulos, Glenn Poulos Holdings and Sylvain LaFreniere.
Pursuant to the Share Exchange Agreement, Newlook exchanged 1,018,432 shares of
Newlook's securities in exchange for 3,426,500 shares of the Company's common
stock.





At
the present time, the Company is unaware of any arrangements which may result in
a change in control of the Company.





Item 12. Certain Relationships and
Related Transactions, and Director Independence.





Through the acquisition of mmwave, the
Company acquired a debt by Xpress Test Solutions Inc. (an entity in whicha former director of the
Company is a minority shareholder) to mmwave of $181,676. During fiscal 2005 and
since acquisition date of mmwave, the Company has sold
products totaling
$6,655and provided services valued at
$39,851to Xpress Test Solutions.On December 31, 2005, Xpress Test
Solutions Inc. provided the Company a $181,676,8% promissory note pursuant to which
Xpress Test Solutions Inc. agreed to repay the note over a two year period with
an initialpayment of
$21,496in January 2006,
followed by twenty three monthly payments of $6,999beginning on February 28, 2006 and
ending on December 31, 2007. The shareholders of Xpress Test Solutions Inc. also
entered into a Pledge and Security Agreement under which the shares of Xpress
Test Solutions Inc. were pledged to the Company as security for the promissory
note.As of June 29, 2007,
Xpress Test Solutions Inc. owed mmwave $90,003.  Pursuant to a
settlement agreement with Brad Poulos dated June 26, 2007 the Xpress Test
Solutions debt was transferred to Brad Poulos.





On December 31, 2005, the Company
terminated theLumonall
(formerly known as Midland International Corporation)management services agreement and
negotiated a settlement agreement whereby all amounts owed to the Company were
converted intoan 8%
promissory note in the amount of $424,734, pursuant to whichLumonallagreed to repay the note over a one year
period with an initial payment of $100,000 on March 15, 2006, followed by three
payments of $108,244.66 on June 30, 2006, September 30, 2006 and December 31,
2006.Lumonallalso agreed to enter into a General
Security Agreement providing a first charge security position on all of the
assets ofLumonalto the Company.According to the terms of the promissory
note, the Company has the option, but not the obligation, to convert the
outstanding principal and interest payment due on each of June 30, 2006,
September 30, 2006 and December 31, 2006 into shares ofMidlandcommon stock at $0.035 per
share.Midlandfailed to make the payments to the
Company and during fiscal 2006 the Company reserved the full amount as a
doubtful account.





In July 2006, Mr. Brad Poulos and Mr.Glenn Pouloswere issued one time stock bonuses of
900,000 and 1,000,000 shares of the Company’s common stock for obtaining a
contract with a global telecommunications manufacturer. Mr. Brad Poulos directed
the Company to issue 100,000 of his 1,000,000 share bonus to Mr. Hokkanen, the
Company’s CFO, for his efforts in assisting the Company to obtain the
contract.





On December 29, 2006, the Company sold
4,860,000 shares of Midland International Corporation to John Simmonds in
exchange for a cash payment of $48,600. At the time Mr. Simmonds was not an
officer or director nor did he hold any ownership position in the
Company.  During fiscal 2007, the Company collected $150,000 from
Lumonall.





On February 19,
2007, Mr. Glenn Poulos entered into an agreement with the Company whereby he
resigned as a member of the Board of Directors of the Company, as President of
mmwave and as a Director of mmwave. Under the provision of the agreement Mr.
Glenn Poulos agreed to accept a severance of approximately $122,000 paid over a
one year period.  On February 19, 2007, Mr. Brad Poulos entered into
an agreement with the Company whereby he resigned as President of the Company
and as Chairman of the Board of Directors. Under the provision of his agreement
Brad Poulos agreed to accept a severance of approximately $360,000 paid over a
three year period.


32





Mr. Brad Poulos and
Mr. Glenn Poulos agreed to return 900,000 and 1,000,000 shares of the Company’s
common stock, respectively, issued as a special bonus during 2006 subject to
receiving three year warrants to purchase the same number of shares of the
Company’s common stock exercisable at $0.15 per share. At the time of issuance,
Mr. Brad Poulos directed the Company to issue 100,000 of his 1,000,000 share
bonus to Mr. Hokkanen. Mr. Hokkanen also agreed to return 100,000 shares of the
Company’s common stock issued as a special bonus and will receive warrants on
the same replacement basis as Mr. Brad Poulos and Mr. Glenn Poulos.





On
November 23, 2007 the Company completed a series of related transactions whereby
it acquired a total of 751,807 common shares of Newlook and purchased for
cancellation warrants to purchase 2,000,000 common shares of Wireless
Age.





The Company paid
total consideration of approximately CAD$473,957 to acquire the shares and
warrants. The Company acquired; 1) 401,250 Newlook common shares and 1,000,000
warrants from Glenn Poulos, 2) 350,557 Newlook common shares and 900,000
warrants from Brad Poulos and 3) 100,000 warrants from Gary Hokkanen. Glenn
Poulos is a former director of Wireless Age and was President of mmwave. Brad
Poulos is as former director and officer of Wireless Age and Gary Hokkanen is
Chief Financial Officer of the Company. The total consideration paid to Glenn
Poulos was CAD$250,000, paid in five consecutive monthly installments of $50,000
beginning on November 16, 2007. Total consideration paid to Brad Poulos was
CAD$219,153.50 paid in five consecutive monthly installments of CAD$43,830.70
beginning on November 23, 2007. The Company paid US$4,875 to Gary Hokkanen in
one payment.





Effective February
1, 2007, the Company began compensating Mr. Simmonds, the Company’s CEO for rent
and utilities totaling $1,760 (CAD$2,000) for an office location occupied by Mr.
Simmonds and Ms. Weiler, the Company’s Corporate Secretary.





The Board believes
that all of the foregoing related party transactions were made on terms that
were fair and reasonable to the Company.  Directors having an economic
interest in the outcome of such transactions did not participate in the
deliberation or voting with respect to such actions on the part of the
Company.





Item
      13. Exhibits, List and Reports on Form
8-K.








Exhibit
      No.
            DescriptionExhibit
      3.1
            Certificate
      of incorporation, as amended to date, incorporated by reference to the
      exhibits of the Company's Form SB-2 filed with the Commission on February
      26, 2001.Exhibit
      3.2
            Bylaws as
      currently in effect, incorporated by reference to the exhibits of the
      Company's Form SB-2 filed with the Commission on February 26,
      2001.Exhibit
      10.1
            Share
      Purchase Agreement as of July 30, 2004 by and among Wireless Age
      Communications, Inc. and A. BRUCE CAMERON, E. ROSE STEINKE, QUASAR PAGING
      LTD., QUASAR COMMUNICATIONS LTD., CAR-JEN HOLDINGS LTD., THOMAS
      COMMUNICATIONS LTD., I. TOOMBS & SONS HOMES LTD., CLARENCE KNIPPEL and
      LYDIA KNIPPEL (jointly), ALAN VILLETT, and ROBERT C. KING, incorporated by
      reference to exhibit 99.1 of the Company's Form 8-K filed with the
      Commission on August 16, 2004.Exhibit
      10.2
            Agreement
      between Marlon Distributors Ltd., Quasar Paging Ltd., and Bruce Cameron,
      dated September 30, 2004, with respect to the sale of Marlon Recreational
      Products Ltd. incorporated by reference to exhibit 10.20 of the Company's
      Form SB-2 filed with the Commission on February 8,
2005.Exhibit
      10.3
            Stock
      Purchase Agreement between Marlon Distributors Ltd., Wireless Age
      Communications, Inc. and David MacKinnon, Rosemary Gilbert, Joshua
      MacKinnon and James S. Hardy, dated July 29, 2005 incorporated by
      reference to Exhibit 99.1 of the Company’s Form 8-K filed with the
      Commission on August 4, 2005.Exhibit
      10.4
            Termination
      Agreement between Simmonds Mercantile and Management Inc. and Wireless Age
      Communications, Inc., dated September 30, 2005, incorporated by reference
      to Exhibit 99.1 of the Company’s Form 8-K filed with the Commission on
      October 6, 2005.Exhibit
      10.5
            Employment
      Agreement between Wireless Age Communications, Inc. and Gary N. Hokkanen,
      dated December 30, 2005, incorporated by reference to Exhibit 99.1 of the
      Company's Form 8-K filed with the Commission on January 4,
      2006.Exhibit
      10.6
            Factoring and
      Demand Revolving Loan Agreement between TCE Capital Corporation and
      Wireless Communications Ltd. and Wireless Source Distribution Ltd. dated
      January 17, 2006, incorporated by reference to Exhibit 10.37 of the
      Company’s Form 10-KSB filed with the Commission on March 30,
      2006.Exhibit
      10.7
            Preferred
      Stock Purchase Agreement between Wireless Age Communications, Inc. and
      Barron Partners L.P.  dated August 3, 2006, incorporated by
      reference to Exhibit 10.38 of the Company’s Form SB-2 Amendment No. 1
      filed with the Commission on September 15, 2006.Exhibit
      10.8
            Registration
      Rights Agreement between Wireless Age Communications, Inc. and Barron
      Partners L.P. dated August 3, 2006, incorporated by reference to Exhibit
      10.39 of the Company’s Form SB-2 Amendment No. 1 filed with the Commission
      on September 15, 2006.Exhibit
      10.9
            Common Stock
      Purchase Warrant “A” issued by Wireless Age Communications, Inc. to Barron
      Partners L.P. dated August 3, 2006, incorporated by reference to Exhibit
      10.40 of the Company’s Form SB-2 Amendment No. 1 filed with the Commission
      on September 15, 2006.Exhibit
      10.10
            Common Stock
      Purchase Warrant “B” issued by Wireless Age Communications, Inc. to Barron
      Partners L.P. dated August 3, 2006, incorporated by reference to Exhibit
      10.41 of the Company’s Form SB-2 Amendment No. 1 filed with the Commission
      on September 15, 2006.Exhibit
      10.11
            Settlement
      Agreement between Newlook Industries Corp. and Wireless Age
      Communications, Inc. dated June 29, 2007*Exhibit
      10.12
            Factoring
      Agreement Amendment Agreement between TCE Capital Corporation, Wireless
      Age Communications Ltd., Wireless Source Distribution Ltd. Wireless Age
      Communications, Inc., Newlook Industries Corp. and Onlinetel Corp. dated
      December 13, 2007.*Exhibit
      21
            Subsidiaries
      of the Company.*Exhibit
      31.1
            Section 302
      Certification of the Chief Executive Officer*Exhibit
      31.2
            Section 302
      Certification of the Chief Financial Officer*Exhibit
      32.1
            Certification
      of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as
      adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
      2003.*Exhibit
      32.2
            Certification
      of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as
      adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
      2003.**Filed
      herein





33


Item
14.  Principal Accountant Fees and Services.







On March 26, 2004,
the Audit Committee adopted a Pre-approval Policy (“Policy”) governing the
approval of all audit and non-audit services performed by the independent
auditor in order to ensure that the performance of such services does not impair
the auditor’s independence.




According to the
Policy, the Audit Committee will annually review and pre-approve the services
and fees that may be provided by the independent auditor during the following
year.  The Policy specifically describes the services and fees related
to the annual audit, other services that are audit-related, preparation of tax
returns and tax related compliance services and all other services that have the
general pre-approval of the Audit Committee.  The term of any general
pre-approval is 12 months from the date of pre-approval, unless the Audit
Committee specifically provides for a different period.




Any service to be
provided by the independent auditor that has not received general pre-approval
under the Policy is required to be submitted to the Audit Committee for approval
prior to the commencement of a substantial portion of the
engagement.  Any proposed service exceeding pre-approved cost levels
is also required to be submitted to the Audit Committee for specific
approval.




The Audit Committee
will revise the list of general pre-approved services from time to time based on
subsequent determinations.  The Committee does not delegate its
responsibilities to pre-approve services performed by the independent auditor to
management.






Fees






The following table
sets forth the aggregate fees billed by the Company’s independent auditors for
fiscal years and 2006 and 2007:




Year
            
            Audit
      Fees (1)
            
            
            Audit
      Related Fees (2)
            
            Tax
      Fees
            All
      Other Fees (3)
            
            Total2006
            
            $
            90,706
            
            
            $
            25,597
            
            $ Nil
            $ Nil
            
            $
            116,3032007
            
            $
            76,380
            
            
            $ Nil
            
            $
      Nil
            $
      Nil
            
            $
            76,380





(1)
            Includes fees
      for the annual audit and quarterly
reviews.





(2)        Includes
fees for services for miscellaneous compliance audits and other SEC
filings.





34





SIGNATURES





In
accordance with Section 13 or 15(d) of the Exchange Act, the Registrant caused
this Report to be signed on its behalf by the undersigned, thereto duly
authorized.





Date:  August
29, 2008




WIRELESS AGE COMMUNICATIONS,
INC.





By:/s/ John G.
      SimmondsJohn G.
      Simmonds, Chief Executive
Officer








In
accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
dates indicated.





Name
            Title
            Date/s/ John G.
      Simmonds
            
            August 29,
      2008John
      G. Simmonds
            CEO, Director
      and Chairman of the Board (principal executive officer)/s/ Brian
      Usher-Jones
            
            August 29,
      2008Brian
      Usher-Jones
            Director/s/ Stephen
      Dulmage
            
            August 29,
      2008Stephen
      Dulmange
            Director/s/ Carrie J.
      Weiler
            
            August 29,
      2008Carrie
      J. Weiler
            Corporate
      Secretary, Director/s/ Jason
      Moretto
            
            August 29,
      2008Jason
      Moretto
            Director/s/ Gary N.
      Hokkanen
            
            August 29,
      2008Gary
      N. Hokkanen
            CFO
              (principal
      accounting officer)