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UNITED STATES 
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549



FORM 10-K



(Mark One)



[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the fiscal year ended October 31, 2009



Or



[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the transition period from ________________ to________________



Commission file number 333-153868



NEXAIRA WIRELESS INC.(Exact name of registrant as specified in its charter)



|                                                               |                                     
|-------------------------------------------------------------- | ------------------------------------
|Nevada                                                         | N/A                                 
|(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.)
|                                                               |                                     
|1404 510 West Hastings Street                                  | 20-8748507                          
|Vancouver,  B.C.  V6B 1L8 Canada                               | V6B 1L8                             
|(Address of principal executive offices)                       | (Zip Code)                          



Registrants telephone number, including area code (604) 682-5629



Securities registered pursuant to Section 12(b) of the Act:  None



Securities registered under Section 12(g) of the Act:



Common Stock, $0.001 par value per share(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.



Yes o No x



Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.



Yes o  No x



Indicate by check mark whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.



Yes o  No x



Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).



Yes o   No o(Not currently applicable to the Registrant)



Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.



Yes o  No x



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



|                                                                    |   |                           |  
|------------------------------------------------------------------- | - | ------------------------- | -
|Large accelerated filer                                             | o | Accelerated filer         | o
|                                                                    |   |                           |  
|Non-accelerated filer
(Do not check if a smaller reporting company) | o | Smaller reporting company | x



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).



Yes o  No x



State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrants most recently completed second fiscal quarter.



There was no trading market for our common shares as of the last business day of our most recently completed second fiscal quarter.  The aggregate market value of the voting and non-voting common equity held by non-affiliates based on the price of our most recently completed private placement of US$0.50 per share on January 6, 2010 was US$16,209,175.



APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS



Indicate by check mark whether the issuer has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.



Yes o  No oNot applicable.



(APPLICABLE ONLY TO CORPORATE REGISTRANTS)



Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.



57,333,785  shares of common stock as of January 27, 2010.



DOCUMENTS INCORPORATED BY REFERENCE



List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) Any annual report to security holders; (2) Any proxy or information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933. The listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 24, 1980).



Not Applicable



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ANNUAL REPORT ON FORM 10-K 
FOR THE YEAR ENDED OCTOBER 31, 2009

TABLE OF CONTENTS



|          |                                                                                                               |     
|--------- | ------------------------------------------------------------------------------------------------------------- | ----
|          |                                                                                                               | Page
|PART 1    |                                                                                                               | 4   
|ITEM 1.   | BUSINESS.                                                                                                     | 4   
|ITEM 1 A. | RISK FACTORS.                                                                                                 | 8   
|ITEM 1 B. | UNRESOLVED STAFF COMMENTS.                                                                                    | 15  
|ITEM 2.   | PROPERTIES.                                                                                                   | 15  
|ITEM 3.   | LEGAL PROCEEDINGS.                                                                                            | 16  
|ITEM 4.   | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.                                                          | 16  
|          |                                                                                                               |     
|PART II   |                                                                                                               |     
|ITEM 5.   | MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. | 16  
|ITEM 6.   | SELECTED FINANCIAL DATA.                                                                                      | 16  
|ITEM 7.   | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.                        | 16  
|ITEM 7A.  | QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISKS.                                                   | 23  
|ITEM 8.   | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.                                                                  | 23  
|ITEM 9.   | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.                         | 24  
|ITEM 9(T) | CONTROLS AND PROCEDURES.                                                                                      | 24  
|ITEM 9 B. | OTHER INFORMATION.                                                                                            | 27  
|          |                                                                                                               |     
|PART III  |                                                                                                               |     
|ITEM 10.  | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.                                                       | 27  
|ITEM 11.  | EXECUTIVE COMPENSATION.                                                                                       | 32  
|ITEM 12.  | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.               | 35  
|ITEM 13.  | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.                                    | 37  
|ITEM 14.  | PRINCIPAL ACCOUNTANT FEES AND SERVICES.                                                                       | 41  
|ITEM 15.  | EXHIBITS, FINANCIAL STATEMENT SCHEDULES.                                                                      | 42  
|          | SIGNATURES                                                                                                    | 44  





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PART I



FORWARD-LOOKING STATEMENTS.



This annual report contains forward-looking statements. Forward-looking statements are projections in respect of future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as may, should, intend, expect, plan, anticipate, believe, estimate, predict, potential, or continue or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in Item 1A Risk Factors of this report, which may cause our or our industry's actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements.  These risks and uncertainties include: a continued downturn in international economic conditions; the number of competitors with competitively priced products and services; our ability to secure patents for our proprietary technologies; our ability to bring new products to market; market demand for our products; shifts in industry capacity; product development or other initiatives by our competitors; fluctuations in the availability and cost of materials required to produce our products; delays in the implementation of our projects and disputes regarding the performance of our services; potential negative financial impact from claims, lawsuits and other legal proceedings or challenges; and other factors beyond our control.



Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.



As used in this annual report, the terms we, us and our mean Nexaira Wireless Inc., formerly Technology Publishing, Inc., and our subsidiaries, Nexaira Inc. and Nexaira, Inc.  All dollar amounts refer to United States dollars unless otherwise indicatedand all references to common stock refer to the common shares in our capital stock.  Our financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.



ITEM 1. BUSINESS.



Corporate History



We were incorporated in the State of Nevada on March 19, 2007. On June 1, 2007, we entered into a share purchase agreement with Slawek Kajko, president, secretary, treasurer and a director of our company, whereby we acquired all of the issued and outstanding shares of Westside Publishing Ltd. in consideration for the issuance of a promissory note in the amount of $28,047. Westside Publishing Ltd. became our wholly-owned subsidiary and we commenced the business of publishing and selling advertising for a consumer electronics magazine entitled Canada HiFi. In addition to this, we also provide graphic design services.



Our former wholly-owned subsidiary, Westside Publishing Ltd., was incorporated in the Province of Ontario, Canada on September 19, 2003.  We divested Westside Publishing Ltd. effective October 28, 2009 as consideration for the cancellation of 40.8 million shares of our restricted common stock, which cancellation occurred on October 30, 2009.



On September 28, 2009, we entered into a share exchange agreement, which closed effective September 29, 2009, with our former subsidiary, Westside Publishing Ltd., Nexaira Inc., an Alberta corporation (Nexaira), Nexairas wholly-owned subsidiary, Nexaira, Inc., a California corporation, and the security holders of Nexaira, whereby we agreed to acquire all of the issued and outstanding common shares in the capital of Nexaira from its shareholders in consideration for the issuance, by us, of 15,489,262 restricted common shares in the capital of our company on the basis of 1.75 shares of our common stock for every one Nexaira share. On October 2, 2009 we filed our current report on Form 8-K with the Securities and Exchange Commission disclosing the transaction.



On December 14, 2009 we filed an amendment to our October 2, 2009 current report on Form 8-K to include the financial statements of Nexaira Inc.  The business combination was accounted for as a reverse acquisition and, as a result, we changed our year end from August 31 to October 31.  As the acquisition occurred subsequent to our fiscal year ended August 31, 2009, we filed our Form 10-K for that fiscal year with the Securities and Exchange Commission on November 18, 2009.



Effective October 26, 2009, we completed a merger with our subsidiary, Nexaira Wireless Inc., a Nevada corporation which was incorporated solely to effect a change in our name to better reflect the nature of our business.  As a result, we have changed our name from Technology Publishing, Inc. to Nexaira Wireless Inc.  The name change became effective with the Over-the-Counter Bulletin Board at the opening for trading on November 2, 2009 under the new stock symbol NXWI.



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Our Business



About Westside Publishing Ltd.



During our fiscal year ended October 31, 2009, we published and sold advertising for a consumer electronics magazine entitled Canada HiFi  through our former subsidiary, Westside Publishing Ltd. In addition to this, we also provided graphic design services.



Effective October 28, 2009, after carefully considering the fit of Westside Publishing Ltd. with the future business plans being executed by the management of our new wholly-owned subsidiary, Nexaira, our board of directors made a decision to divest all of our companys interest in Westside Publishing Ltd. As consideration for this divestment of Westside Publishing Ltd., 40,800,000 restricted common shares held by our former president were surrendered for cancellation. As a result of the divestment of Westside Publishing Ltd., our business is now solely focused on the development of wireless routing solutions through the operations of our subsidiary, Nexaira. On October 30, 2009, 20,000,000 restricted common shares held by a former officer and director were also surrendered for cancellation under a return to treasury agreement.  Each of the share cancellations were effective as of October 30, 2009.



About Nexaira Inc.



Effective September 29, 2009 as disclosed in our current report on Form 8-K as filed with the Securities and Exchange Commission on October 2, 2009, we entered into a Share Exchange Agreement with Westside Publishing, Nexaira,  Nexairas wholly-owned subsidiary, Nexaira, Inc., and the security holders of Nexaira. We agreed to acquire all of the issued and outstanding common shares in the capital of Nexaira from the shareholders of Nexaira in consideration for the issuance, by us, of 15,489,262 shares of our common stock.  With the divestment of Westside Publishing Ltd., on October 28, 2009, our current subsidiaries are Nexaira Inc., an Alberta corporation and Nexaira, Inc., a California corporation.



The business combination was accounted for as a reverse acquisition, primarily effected by exchanging equity interests by the issuing of our shares (accounting acquiree) to the owners of Nexaira (accounting acquirer) as explained above and accordingly; reflected as a recapitalization in the consolidated financial statements.



Nexaira develops and delivers third and fourth generation (3G/4G) Wireless Routing Solutions that offer speed, reliability and security to carriers, mobile operators, service providers, value added resellers (VARS) and enterprise customers. Recognizing the need for competitively priced, high quality wireless broadband devices in 2008, Nexaira designed and developed customizable branded 3G/4G routing platforms for the business market.



Nexaira believes that its routing solutions are simple to install, yet provide the advanced management and business class features demanded by the most sophisticated users. The patent pending I3 GUI (Graphical User Interface) makes routing platforms quick and easy to install providing the functionality, performance and ease of use expected in the market today.  Nexaira believes its routing devices are ideal for high availability applications acting as the primary router to wireless, DSL, landline or cable networks, or can be used to provide complete device and network redundancy in wan-failover/ fail back applications. Headquartered in San Diego with a corporate  office in Vancouver, Nexaira has thirty employees.



When Nexaira was formed in 2005, the key focus was to build an organization focused on wireless data communications technology and to develop key supplier and customer relationships. This close involvement with suppliers and customers allowed Nexaira to develop an innovative plan for the development and delivery of new products and services to satisfy customer needs and to realize the benefits of being in the forefront of an industry poised to grow exponentially over the coming years.



In 2008, Nexaira management initiated the development of a new wireless routing platform and for the first time in its history began writing its own proprietary firmware and software. Nexaira continued to deliver approximately $12 million in distribution revenue in 2008 as it did in 2007 but retooled its operations and processes to provide compelling 3G/4G wireless routing solutions that it believes are highly competitive in both function and price.  Management anticipated the effect of exiting the non strategic low margin distribution business in 2009 and knowing the impact on revenues made appropriate adjustments in its cost structure relating to the legacy distribution business. In December of 2008, Nexaira launched its consumer class router followed by its highly acclaimed I3 GUI in March 2009.  In May 2009 we launched our first Business Class Product and delivered demos to our first carrier customer.



Nexaira has hired what it believes to be, an exceptional team that has developed highly functional wireless firmware and software data technologies that have multiple potential patents that are in the process of being filed. The  development staff has engineered a family of proprietary next generation wireless 3G/4G routers that it believes will outperform the competition at a lower price while  maintaining significant gross margins. In parallel with this product development Nexaira believes it has built an experienced sales and marketing team and Board of Directors.



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Nexairas Business and Outlook



Nexaira intends to be a provider of 3G/4G wireless broadband data solutions for business. We believe our product line will enable our customers to expeditiously connect to and manage high speed data connections rivaling traditional landline connectivity, with unmatched functionality, speed and ease of use: at a lower cost. Nexairas wireless broadband data solutions combine an intuitive user interface (I3 GUI) with advanced firmware and software which we believe will ensure users benefit from the industrys most advanced features and functionality.



We believe our proprietary routing solutions are simple to install, yet provide the advanced business grade feature sets demanded by the most sophisticated users. Service providers have selected Nexairas broadband data solutions for their high availability and wide area network (WAN) failover applications using the 3G cellular network to automatically back up or stand in when service from wireline networks is interrupted.  Additionally,we believe that carriers and service providers can dramatically decrease the cost and management of their installed hardware base by using Nexairas advanced firmware extending the shelf life of their customer premise equipment and providing critical device updates through simple downloads.  We enable our customers to bring customized wireless broadband solutions to market more quickly and cost effectively than traditional wireline offerings such as DSL, Cable or T-1s.



Nexairas hardware-agnostic broadband router firmware and intuitive user interface enables a non-technical user to quickly and effortlessly setup a network and establish a secure Internet connection.



In addition, the superior management tools and reliable operating design supports the needs of the largest customer networks that rival existing wireline deployments but have all the benefits of wireless.



Future Strategy.  Nexaira intends to:



-

Continue to build on its Intellectual Property (IP) by designing and developing leading edge wireless routers including industry leading firmware and software (NexWare)

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Price those solutions aggressively for rapid channel adoption

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Deliver routing platforms with all the security and management features historically only found on wireline routers

-

Develop and deliver a suite of routing products  through:

-

Carriers

-

Information Technology (IT) Resellers

-

Wireless operators

-

Indirect Distribution Channels



Products and Services



Recognizing the need for competitively priced, high quality wireless broadband devices in 2008, Nexaira designed and developed customizable branded routing platforms to aggressively compete against both wireline and other wireless broadband data applications.  By developing its own firmware and software, Nexaira has established itself as a progressive and innovative organization with the proven management capabilities to execute on an accelerated go-to-market strategy.



Nexaira has spent approximately $1,500,000 over the last two fiscal years on research and development activities of which $1,043,009 has been capitalized as software development costs in accordance with ASC 985-20, Accounting for the Costs of Computer Software to be Sold, Leased, or Otherwise Marketed (formerly Statement of Financial Accounting Standards (SFAS) No. 86 issued by the Financial Accounting Standards Board (FASB).  Software development costs are capitalized when technological feasibility and marketability of the related product has been established. Capitalized software costs are amortized on a product-by-product basis, beginning when the product is available for general release to customers.   General release of our software product is expected to occur at the end of May 2010. Therefore no amortization expense has been recorded to date. The amount spent to date has been borne solely by Nexaira versus directly by customers.



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Marketing and Sales Activities



Nexaira is realizing opportunities that are developing in multiple verticals across many market segments.  The verticals listed below are where we are realizing that a.) genuine interest is present b.) product is being tested and or c.) sales are being made. Management is confident based on early adoption of its products that any one of these verticals will contribute to its revenue plan, if not all. Sales activities are currently underway in each of the following which we believe validates our strategy:



Wan Failover - Business continuityExisting wireline network customers of Tier One and Tier Two carriers want a 3G routing solution that ensures their services are not interrupted in the event of a device failure or failure of the wireline network which is a common occurrence today. In most cases alternative broadband services are not available and if so rarely in a diverse route. Wireless broadband provides a completely diverse route matching or exceeding wireline bandwidth throughput.  Nexware provides business class reliability features based on industry standard protocols and processes used for years in sophisticated wireline networking equipment.  Nexwares use of these protocols allows it to work with existing wireline equipment to provide network availability previously only supported by routers many times its price.  Nexaira is actively engaged with multiple managed service and value added service providers developing High Availability and Business Continuity Services no longer able to be met with a dial backup solution.



Primary CPE (Customer Premise Equipment -We intend to compete head on with traditional landline routing products by offering higher function and lower cost than what MSPs (Managed Service Providers) have available to choose from  today with the unique capability of both landline and 3G network connectivity.



Small Medium Sized Businesses (SMB) & MerchantsThis vertical is made up of QSR (Quick Service Retail) and small businesses needing quick and simple installations but have neither the time nor the patience to wait for scheduled installation, which traditionally could take several weeks. In addition the reduced cost and improved performance of HSPA and HSPA+ networks we believe we will offer this segment an alternative to wireline.



Last Mile Solutiondue to lack of existing facilities-There are many areas in the United States and around the world, where copper, DSL or cable has not been installed.  We believe the opportunity exists to supply wireless broadband services in this niche market.



Emerging and developing markets in Brazil, Russia, India, and China (BRIC), Latin America, Mid Eastern and African countries are growing faster than in developed countries and have taken the approach that wireline solutions are no longer the optimal cost effective or timely choice for last mile.



Competition



Current industry research indicates that wireless data service providers have reached an inflection point with wireline data service providers.



The competition is divided into two distinct categories:



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Legacy wireline providers who:

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treat wireless as a consumer routing application;

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use Cisco and Juniper type devices that can cost in excess of $1,000 per unit; and

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have limited cellular modem support or controlled modem distribution and pricing.



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Wireless device manufacturers targeting consumers that do not provide business class solutions including:

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reliability and availability protocols;

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security and access protocols; and

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remote management.



Technology



Through the investment in research and development activities, Nexaira has developed a line of routing solutions under the NEXWARE service mark which have two targeted markets:



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Business Market



Provides business-grade network reliability and security for wireless routers, including:



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business continuity via cellular 3G/4G backup to wireline service;

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business class security protocols to support confidential data;

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a suite of Quality of Service (QoS) options to support business performance; and

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Small Business Call Management supporting voice services over 3G/4G technologies.



Provides business-grade networking speeds with cellular WAN algorithms and high gain antennas and wireless routers, including:



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XtremeSpeed, providing fastest 3G Performance required for business applications;

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High Gain Directional Antennas, providing improved performance from:

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Increasing signal gain 10 times;

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Decreasing noise 10 times; and

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Increases connection reliability.



Consumer Market



Nexwares ease of use connection manager:



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provides auto-configuration to any modem card on any network; and

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reduces the number of returns and support calls.



Nexware i3Graphical User Interface and Desktop Gadgets:



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provides ease of use and higher customer product acceptance,

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enables end-users to do self-installations, and

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improves customer satisfaction.



Intellectual Property



We have applications pending and/or registered trademarks/service-marks for our entire product portfolio, including:



NexWareTMfor the family of firmware products

NexWaveTMfor the family of wireless antennas

NexCallTMfor the family of call management products

XtremeSpeedTMforNexWareTMwireless algorithm optimization

i3GUITMforNexWareTMIconic Graphical User Interface



Nexaira has patents pending or is in the process of filing for patent protection.



Employees



Nexairas operations are headquartered in San Diego, California with a corporate office in Vancouver, British Columbia.  Nexaira has thirty employees.



ITEM 1A. RISK FACTORS.



In addition to other information in this annual report, the following risk factors should be carefully considered in evaluating our business because such factors may have a significant impact on our business, operating results, liquidity and financial condition. As a result of the risk factors set forth below, actual results could differ materially from those projected in any forward-looking statements. Additional risks and uncertainties not presently known to us, or that we currently consider to be immaterial, may also impact our business, operating results, liquidity and financial condition. If any such risks occur, our business, operating results, liquidity and financial condition could be materially affected in an adverse manner. Under such circumstances, the trading price of our securities could decline, and you may lose all or part of your investment.



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Risks Associated with our Business



If we are unable to obtain financing in the amounts and on terms and dates acceptable to us, we may not be able to expand or continue our operations and development and so may be forced to scale back or cease operations or discontinue our business. You could lose your entire investment.



We do not currently have any arrangements for financing and we can provide no assurance to investors we will be able to find such financing when such financing is required. Obtaining additional financing would be subject to a number of factors, including investor acceptance of our NexWare routing solutions and our business model. Furthermore, there is no assurance that we will not incur additional debt in the future, that we will have sufficient funds to repay our future indebtedness, or that we will not default on our debts, thereby jeopardizing our business viability. Finally, we may not be able to borrow or raise additional capital in the future to meet our needs or to otherwise provide the capital necessary to maintain our operations, which might result in the loss of some or all of your investment in our common stock.



We anticipate that the funds that were raised from private placements by way of subscription agreements and funds advanced by our management will not be sufficient to satisfy our cash requirements for the next twelve month period. Also, there is no assurance that actual cash requirements will not exceed our estimates. In particular, additional capital may be required in the event that:



| |    |                                                                                                                                                         
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------
| | 1. | We are unsuccessful in penetrating our target markets and realizing our targeted revenues;                                                              
| |    |                                                                                                                                                         
| | 2. | The cost of manufacturing exceeds our estimated costs and we are not able to realize expected gross margins to support our overhead; or                 
| |    |                                                                                                                                                         
| | 3. | Costs associated with developing our products or filing patents exceed estimates or our IP is infringed upon and we have to defend it in a court of law.



The occurrence of any of the aforementioned events could prevent us from executing our business plan, expanding our business operations and ultimately achieving a profitable level of operations.



We depend almost exclusively on outside capital to pay for the continued development of our business and the marketing of our products. Such outside capital may include the sale of additional stock, stockholder and director advances and/or commercial borrowing.



There can be no assurance that capital will continue to be available if necessary to meet our continuing development costs or, if the capital is available, that it will be on terms acceptable to us. The issuance of additional equity securities by us may result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. If we are unable to obtain financing in the amounts and on terms deemed acceptable to us, we may not be able to expand or continue our sales and marketing initiatives  and so may be forced to scale back or cease operations or discontinue our business and you could lose your entire investment.



Because our directors and officers control a large percentage of our common stock, such insiders have the ability to influence matters affecting our stockholders.



Our directors and officers, in the aggregate, beneficially own 45.30% of the issued and outstanding shares of our common stock. As a result, they have the ability to influence matters affecting our stockholders, including the election of our directors, the acquisition or disposition of our assets, and the future issuance of our shares. Because our officers and directors control such shares, investors will find it difficult to replace our management if they disagree with the way our business is being operated. Because the influence by these insiders could result in management making decisions that are in the best interest of those insiders and not in the best interest of the investors, you may lose some or all of the value of your investment in our common stock.



Our monthly, quarterly and annual financial results will be subject to fluctuations that could affect the market price of our common shares.



Our revenue, gross margin, operating earnings and net earnings may vary from month to month and quarter to quarter and could be significantly impacted by a number of factors, including:



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Possible delays or shortages in manufactured components;

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Price and product competition, which may result in lower selling prices for some of our products or lost market share;

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Transition periods associated with the migration of new technologies;

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The development and timing of the introduction of our new products;

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The securing of channel slots for new products and the timing of sales orders and OEM and carrier customer sell through;

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Product mix of our sales As our  products have different gross margins;

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The amount of inventory held by our channel partners;

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Possible cyclical fluctuations related to the evolution of wireless technologies;

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Possible delays in the manufacture or shipment of current or new products;

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Possible product quality  that may increase our cost of goods sold;

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Possible increased inventory levels;Concentration in our customer base; and

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The achievement of milestones related to signing new customers.



Because our operating expenses are determined based on anticipated sales, are generally fixed and are incurred throughout each fiscal month and quarter, any of the factors listed above could cause significant variations in our revenues, gross margin and earnings in any given month or quarter. Therefore, our monthly and quarterly results are not necessarily indicative of our overall business, results of operations and financial condition.



Monthly, quarterly and annual variations in operating results or any of the other factors listed above, changes in financial estimates by securities analysts, or other events or factors may result in wide fluctuations in the market price of our stock price. In addition, the financial markets have experienced significant price and volume fluctuations that have particularly affected the market prices of equity securities of many technology companies and that often have been unrelated to the operating performance of these companies or have resulted from the failure of the operating results of such companies to meet market expectations in a particular quarter.  Broad market fluctuations or any failure of our operating results in a particular quarter to meet market expectations may adversely affect the market price of our common shares.



Competition from new or established wireless communication companies or from those with greater resources may prevent us from increasing or maintaining our market share and could result in price reductions and/or loss of business with resulting reduced revenues and gross margins.



The wireless communications industry is highly competitive and we expect competition to increase and intensify. More established and larger companies with greater financial, technical and marketing resources sell products that compete with ours and we expect this competition to intensify. We also may introduce new products that will put us in direct competition with major new competitors. Existing or future competitors may be able to respond more quickly to technological developments and changes and introduce new products before we do, or may independently develop and patent technologies and products that are superior to ours or achieve greater acceptance due to factors such as more favorable pricing, more desired or better quality features or more efficient sales channels. If we are unable to compete effectively with our competitors pricing strategies, technological advances and other initiatives, we may lose customer orders and market share and we may need to reduce the price of our products, resulting in reduced revenue and reduced gross margins.



Acquisitions of companies or technologies may result in disruptions to our business or may not achieve the anticipated benefits.



As part of our business strategy, we may acquire additional assets and businesses principally relating to or complementary to our current operations. Any acquisitions and/or mergers by us will be accompanied by the risks commonly encountered in acquisitions of companies.



These risks include, among other things:



-

Exposure to unknown liabilities of acquired companies, including unknown litigation related to acts or omissions of our acquired company and/or its directors and officers prior to the acquisition;

-

Higher than anticipated acquisition and integration costs and expenses;

-

Effects of costs and expenses of acquiring and integrating new businesses on our operating results and financial condition;

-

The difficulty and expense of integrating the operations and personnel of the companies;

-

Disruption of our ongoing business;



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-

Diversion of management's time and attention away from our remaining business during the integration process;

-

Failure to maximize our financial and strategic position by the successful incorporation of acquired technology;

-

The inability to implement uniform standards, controls, procedures and policies;

-

The loss of key employees and customers as a result of changes in management;

-

The incurrence of amortization expenses.



As a result of the growth of our company, we may seek to raise additional capital through an offering of common shares, preference shares or debt, which may result in dilution and/or the issuance of securities. As a result, our share price may decline and there may be possible dilution to our shareholders if the purchase price is paid in common shares or securities convertible into common shares.



In addition, geographic distances may make integration of businesses more difficult. We may not be successful in overcoming these risks or any other problems encountered in connection with any acquisitions. If realized, these risks could reduce shareholder value.



The loss of any of our significant customers could adversely affect our revenue and profitability, and therefore shareholder value.



We sell our products through carriers, mobile operators, service providers, value added resellers (VARS) and enterprise customers. We are dependent on a limited number of customers for a significant portion of our revenues. Most of these customers also sell products of our competitors. Accordingly, our business and future success depends on our ability to maintain and build on existing relationships and develop new relationships. If any of these customers, for any reason, discontinues their relationship with us or reduces or postpones current or expected purchase orders for products, or suffers from business failure, our revenues and profitability could decline, perhaps materially.  We expect that a limited number of customers will account for a significant portion of our revenues for the foreseeable future. In addition, our current customers purchase our products under purchase orders. Our customers have no contractual obligation to continue to purchase our products following our fulfillment of current purchase orders and if they do not continue to make purchases, our revenue and our profitability could decline, perhaps materially.



We depend on single source suppliers for some components used in our products and if these suppliers are unable to meet our demand the availability of our products may be materially adversely affected.



From time to time, certain components used in our products have been, and may be, in short supply worldwide and shortages in allocation of components may result in delay in filling orders from our customers, which may adversely affect our business. In addition our suppliers may experience damage or interruption in their operations, become insolvent or bankrupt, or experience claims of infringement, all of which could delay or stop their shipment of components to us, which may adversely affect our business. Alternate sources of components may not be available. If there is a shortage of any such components and we cannot obtain an appropriate substitute, we may not be able to deliver sufficient quantities of our products, we may lose business or customers and our revenue may be materially adversely affected.



We depend on a limited number of third parties to manufacture our products. If they do not manufacture our products properly or cannot meet our needs in a timely manner, we may be unable to fulfill our product delivery obligations and our costs may increase, and our revenue and margins could decrease.



We outsource the manufacturing of our products to a limited number of third parties and depend heavily on the ability of these manufacturers to meet our needs in a timely and satisfactory manner at a reasonable cost. We currently rely on two manufacturers, either of whom may terminate the manufacturing contract with us at the end of any contract year. Our reliance on third party manufacturers subjects us to a number of risks, including the following:



-

the absence of guaranteed or adequate manufacturing capacity;

-

reduced control over delivery schedules, production levels, manufacturing yields and costs;

-

their inability to secure adequate volumes of components in a timely manner at a reasonable cost; and

-

unexpected increases in manufacturing costs.



If we are unable to successfully manage any of these risks or to locate alternative or additional manufacturers or suppliers in a timely and cost-effective manner, we may not be able to deliver products in a timely manner. In addition, our results of operations could be harmed by increased costs, reduced revenues and reduced margins.  Under our manufacturing agreements, in many cases we are required to place binding purchase orders with our manufacturers well in advance of our receipt of binding purchase orders from our customers. In this situation, we consider our customers good faith, non-binding forecasts of demand for our products.



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As a result, if the number of actual products ordered by our customers is materially different from the number of products we have instructed our manufacturer to build (and purchase components in respect of), then, if too many components have been purchased by our manufacturer, we may be required to purchase such excess component inventory, or, if an insufficient number of components have been purchased by our manufacturer, we may not be in a position to meet all of our customers requirements. If we are unable to successfully manage our inventory levels and respond to our customers purchase orders based on their forecasted quantities, our business could be adversely affected.



We may have difficulty responding to changing technology, industry standards and customer requirements, which could cause us to be unable to recover our research and development expenses and our revenue could decline.



The wireless communications industry is subject to rapid technological change. Our business and future success will depend, in part, on our ability to accurately predict and anticipate evolving wireless technology standards and develop products that keep pace with the continuing changes in technology, evolving industry standards and changing customer and end-user preferences and requirements. Our products embody complex technology that may not meet those standards, preferences and requirements. Our ability to design, develop and commercially launch new products depends on a number of factors, including, but not limited to the following:



-

Our ability to attract and retain skilled technical employees;

-

The availability of critical components from third parties;

-

Our ability to successfully complete the development of products in a timely manner; and

-

Our ability to manufacture products at an acceptable price and quality.



A failure by us, or our suppliers, in any of these areas, or a failure of new products to obtain commercial acceptance, could mean we receive less revenue than we anticipate and we are unable to recover our research and development expenses, and may result in a decrease in the market price for our shares.



We develop products to meet our customers requirements. If we are unable or choose not to meet our customers future needs, we may not win their future business and our revenue and profitability may decrease. In addition, wireless communications service providers require that wireless data systems deployed on their networks comply with their own standards, which may differ from the standards of other providers. We may be unable to successfully address these developments in a timely basis or at all. Our failure to respond quickly and cost-effectively to new developments through the development of new products or enhancements to existing products could cause us to be unable to recover significant research and development expenses and reduce our revenues.



We may infringe on the intellectual property rights of others.



The industry in which we operate has many participants that own, or claim to own, proprietary intellectual property. While to date we have not received assertions or claims from third parties alleging that our products violate or infringe on their intellectual property rights we may receive these assertions in the future. Rights to intellectual property can be difficult to verify and litigation may be necessary to establish whether or not we have infringed the intellectual property rights of others. In many cases, these third parties are companies with substantially greater resources than us, and they may be able to, and may choose to, pursue complex litigation to a greater degree than we could. Regardless of whether these infringement claims have merit or not, we may be subject to the following:



| |   |                                                                                                                                                                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | - | We may be liable for potentially substantial damages, liabilities and litigation costs, including attorneys fees;                                                                                                                                                             
| | - | We may be prohibited from further use of the intellectual property and may be required to cease selling our products that are subject to the claim;                                                                                                                            
| | - | We may have to license the third party intellectual property, incurring royalty fees that may or may not be on commercially reasonable terms. In addition, there is no assurance that we will be able to successfully negotiate and obtain such a license from the third party;
| | - | We may have to develop a non-infringing alternative, which could be costly and delay or result in the loss of sales. In addition, there is no assurance that we will be able to develop such a non-infringing alternative;                                                     
| | - | The diversion of managements attention and resources;                                                                                                                                                                                                                         
| | - | Our relationships with customers may be adversely affected; and                                                                                                                                                                                                                
| | - | We may be required to indemnify our customers for certain costs and damages they incur in such a claim.                                                                                                                                                                        



In the event of an unfavorable outcome in such a claim and our inability to develop a non-infringing alternative, then our business, operating results and financial condition may be materially adversely affected and we may have to restructure our business.



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Misappropriation of our intellectual property could place us at a competitive disadvantage.



Our intellectual property is important to our success. We rely on a combination of patent protection, copyrights, trademarks, trade secrets, licenses, non-disclosure agreements and other contractual agreements to protect our intellectual property.  Third parties may attempt to copy aspects of our products and technology or obtain information we regard as proprietary without our authorization. If we are unable to protect our intellectual property against unauthorized use by others it could have an adverse effect on our competitive position. Our strategies to deter misappropriation could be inadequate due to the following risks:



| |   |                                                                                                                                           
| | - | ------------------------------------------------------------------------------------------------------------------------------------------
| | - | Non-recognition of the proprietary nature or inadequate protection of our methodologies in the United States, Canada or foreign countries;
| | - | Undetected misappropriation of our intellectual property;                                                                                 
| | - | The substantial legal and other costs of protecting and enforcing our rights in our intellectual property; and                            
| | - | Development of similar technologies by our competitors.                                                                                   



In addition, we could be required to spend significant funds and our managerial resources could be diverted in order to defend our rights, which could disrupt our operations.



Fluctuations in exchange rates between the United States dollar and other currencies, including the Canadian dollar may affect our operating results.



We are exposed to fluctuations in the exchange rate between the United States dollar and the Canadian dollar through our operations in Canada. To reduce our risk because of currency fluctuations, we purchase inventory, other cost of sales items and many of our services in United States dollars, however, some of our operating costs are still incurred in Canadian dollars, primarily those relating to marketing, administration and sales support. Given the fluctuation in the Canadian dollar relative to the United States dollar, our operating results may be negatively impacted. To date, we have not entered into any foreign currency futures contracts as part of a hedging policy. We expect that as our business expands in Europe and the Asia-Pacific region, we will also be exposed to additional foreign currency transactions and to the associated currency risk.



We depend on wireless network carriers to offer acceptable wireless data and voice communications services for our products to operate.



Our products can operate on wireline networks but because of our 3G/4G Business Class focus we are dependent on wireless data and voice networks operated by third parties. Our business and future growth depends, in part, on the successful deployment by network carriers of next generation wireless data and voice networks and the network carriers ability to co-market our products.  If these network carriers delay the deployment or expansion of next generation networks or fail to offer our products in conjunction with their data  plans, or fail to price and market their services effectively, sales of our products will decline and our revenues will decrease.



We do not have fixed-term employment agreements with our key personnel and the loss of any key personnel may harm our ability to compete effectively.



None of our executive officers or other key employees has entered into a fixed-term employment agreement. Our success depends in large part on the abilities and experience of our executive officers and other key employees. Competition for highly skilled management, technical, research and development and other key employees is intense in the wireless communications industry. We may not be able to retain our current executive officers or key employees and may not be able to hire and transition in a timely manner experienced and highly qualified additional executive officers and key employees as needed to achieve our business objectives. The loss of executive officers and key employees could disrupt our operations and our ability to compete effectively could be adversely affected.



As our business expands internationally, we will be exposed to additional risks relating to international operations.



If we are unable to further develop distribution channels in Europe and the Asia-Pacific region we may not be able to grow our international operations and our ability to increase our revenue will be negatively impacted.



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Government regulation could result in increased costs and inability to sell our products.



Our products are subject to certain mandatory regulatory approvals in the United States, Canada, the European Union and other regions in which we operate. In the United States, the Federal Communications Commission regulates many aspects of communications devices. In Canada, similar regulations are administered by the Ministry of Industry, through Industry Canada. European Union directives provide comparable regulatory guidance in Europe. Although we have obtained all the necessary Federal Communications Commission, Industry Canada and other required approvals for the products we currently sell, we may not obtain approvals for future products on a timely basis, or at all. In addition, regulatory requirements may change or we may not be able to obtain regulatory approvals from countries other than the United States and Canada in which we may desire to sell products in the future.



If our efforts to restore the business to sustained profitability are not successful, we may be required to restructure or take other actions and our share price may decline.



We have incurred losses from operations in 2009 and 2008 as a result of restructuring our business and selling off low margin end of life products associated with the distribution business and we believe that we will continue to incur losses throughout fiscal year ending October 31, 2010 as we continue to develop our business and launch our new portfolio of routing products and services over the next 8-12 months.



Our ability to achieve and maintain profitability in the future will depend on, among other things, the continued sales of our current products and the successful development and commercialization of new products. If we cannot sustain profitability, our total losses will increase and we may be required to restructure our operations or raise additional capital. Additional financing may not be available, and even if available, may not be on acceptable terms. We may seek to raise additional capital through an offering of common shares, preference shares or debt, which may result in dilution, and/or the issuance of securities with rights senior to the rights, of the holders of common shares. As a result, our share price may decline.



Risks Associated with Our Common Stock



We do not intend to pay dividends on any investment in our common stock.



We do not currently anticipate declaring and paying dividends to our stockholders in the near future. It is our current intention to apply net earnings, if any, in the foreseeable future to increasing our working capital. We anticipated the loss for 2009 as a result of realigning our business strategy with a focusing primarily on developing new products. Because we experienced a loss from operations in 2009 and 2008, there can be no assurance that we will ever have sufficient earnings to declare and pay dividends to the holders of shares of our common stock, and in any event, a decision to declare and pay dividends is at the sole discretion of our board of directors, which currently do not intend to pay any dividends on shares of our common stock for the foreseeable future. To the extent that we require additional financing currently not provided for in our financing plan, our financing sources may prohibit the payment of a dividend. Because we do not intend to declare dividends, any gain on an investment in our common stock will need to come through an increase in the stocks price. This may never happen and investors may lose all of their investment in our common stock.



The price of our common stock is likely to be highly volatile and may decline. If this happens, our stockholders may have difficulty selling their shares and may not be able to sell their shares at all.



We cannot assure you that a trading market will continue to develop for our common stock, or if it does, it may not be sustained, or that any stockholder will be able to liquidate his or her investment without considerable delay, if at all.  The market price of our common stock is likely to be highly volatile and may also fluctuate significantly in response to the following factors, most of which are beyond our control:



| |   |                                                                        
| | - | -----------------------------------------------------------------------
| | - | variations in our quarterly operating results;                         
| | - | changes in market valuations of similar companies;                     
| | - | announcements by us or our competitors of significant new products; and
| | - | the loss of key management.                                            



The equity markets have, on occasion, experienced significant price and volume fluctuations that have affected the market prices for many companies securities and that have often been unrelated to the operating performance of these companies. Any such fluctuations may adversely affect the market price of our common stock, regardless of our actual operating performance. As a result, stockholders may be unable to sell their shares, or may be forced to sell them at a loss.



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Because we can issue additional shares of our common stock, our stockholders may incur immediate dilution and may experience further dilution.



We are authorized to issue up to 600,000,000 shares of common stock. As of January 27, 2010 there were 57,333,785shares of our common stock issued and outstanding. Our board of directors has the authority to cause our company to issue additional shares of common stock without the consent of any of our stockholders. Consequently, our stockholders may experience dilution in their ownership of our company in the future.



Our stock is a penny stock. Trading of our stock may be restricted by the Securities and Exchange Commissions penny stock regulations which may limit a stockholders ability to buy and sell our stock.



Our stock is a penny stock. The Securities and Exchange Commission has adopted Rule 15g-9 which generally defines penny stock to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and accredited investors. The term accredited investor refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the Securities and Exchange Commission which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customers account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customers confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchasers written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.



The Financial Industry Regulatory Authority sales practice requirements may also limit a stockholders ability to buy and sell our stock.



In addition to the penny stock rules described above, the Financial Industry Regulatory Authority, which we refer to as FINRA, has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customers financial status, tax status, investment objectives and other information. Under interpretations of these rules, the FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for shares of our common stock.



ITEM 1B. UNRESOLVED STAFF COMMENTS.



Not applicable.



ITEM 2. PROPERTIES.



Executive, Head Office and Operations



Effective September 29, 2009, our corporate office is located at 1404 510 West Hastings Street, Vancouver, B.C. Canada V6B 1L8. Nexairas operations are located at 6650 Lusk Blvd Suite B20,  San Diego California 92121.  This facility functions as our main operating facility. We believe our current premises are adequate for our operations today but will limit our ability to grow. As a result we are looking to add incremental space as required without increasing our costs significantly.



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ITEM 3. LEGAL PROCEEDINGS.



We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our interest.



ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.



None



PART II



ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.



Market for Securities



Our common shares are quoted on the OTC Bulletin Board under the trading symbol NXWI.OB.  Our shares have been quoted on the OTC Bulletin Board since November 2, 2009. No trades in our common stock were effected on the OTC Bulletin Board until January 6, 2010. There has been only limited trading in our common stock since that date.



Holders of our Common Stock



Our common shares are issued in registered form.  The transfer agent and registrar of our common stock is Empire Stock Transfer Inc., located at 1859 Whitney Mesa Dr., Henderson, NV  89014; telephone: 702 818-5898; fax: 702 974-1444.  As of January 19, 2010, there were 65 holders of record of our common stock.  As of such date, 57,333,785shares of our common stock were issued and outstanding.



Dividend Policy



We have not declared or paid any cash dividends since inception. We intend to retain future earnings, if any, for use in the operation and expansion of our business and do not intend to pay any cash dividends in the foreseeable future. There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends. The Nevada Revised Statutes, however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend:



| |   |                                                                                                                                                                                                                           
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | - | we would not be able to pay our debts as they become due in the usual course of business; or                                                                                                                              
| | - | our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of stockholders who have preferential rights superior to those receiving the distribution.



Recent Sales of Unregistered Securities



Other than as disclosed herein or in previous quarterly reports on Form 10-Q or current reports on Form 8-K, we have not issued any equity securities that were not registered under the Securities Act.



Purchases of Equity Securities by Our Company and Affiliated Purchasers



We did not purchase any of our shares of common stock or other securities during our fiscal year ended October 31, 2009.



ITEM 6. SELECTED FINANCIAL DATA.



Not Applicable.



ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.



the following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include those discussed below and elsewhere in this annual report.



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Our audited financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.



Company Overview



We were incorporated in the State of Nevada on March 19, 2007. On June 1, 2007, we entered into a share purchase agreement with Slawek Kajko, our then president, secretary, treasurer and a director of our company, whereby we acquired all of the issued and outstanding shares of Westside Publishing Ltd. in consideration for the issuance of a promissory note in the amount of $28,047. Westside Publishing Ltd. became our wholly-owned subsidiary and we commenced the business of publishing and selling advertising for a consumer electronics magazine entitled Canada HiFi. In addition to this, we also provide graphic design services.



Effective September 29, 2009, we entered into a share exchange agreement with our wholly-owned subsidiary, Westside Publishing Ltd., an Ontario corporation, Nexaira Inc. (Nexaira), an Alberta corporation, Nexairas wholly-owned subsidiary, Nexaira, Inc., a California corporation,  whereby we agreed to acquire all of the issued and outstanding common shares in the capital of Nexaira from the shareholders of Nexaira in consideration for the issuance, by us, of 15,489,262 restricted common shares in the capital of our company on the basis of 1.75 shares of our common stock for every one Nexaira share.



We divested Westside Publishing Ltd. effective October 28, 2009. As consideration for this divestment of Westside Publishing Ltd., 40,800,000 restricted shares held by our former president and director were surrendered for cancellation.  In addition, 20,000,000 restricted shares were surrendered for cancellation by a former officer and director pursuant to a return to treasury agreement with our company dated October 28, 2009.  These share cancellations were effective as of October 30, 2009.



Managements Plan of Operations



2009 was a challenging year for our Company.  We re-aligned  our operations as we felt it necessary to begin exiting from marginally profitable product lines and subsequently liquidating obsolete inventory obtained under the legacy business model being the distribution business.  This resulted in us having to reduce our staffing levels associated with the legacy distribution business which we did. Knowing we would realize reduced revenues from this business and increased costs associated with building the Companys development and engineering staff to prepare us for entering the 3G/ 4G router market, we were successful in raising enough working capital from our single largest investor group to sustain operations and position us for growth in our emerging business. In this last fiscal year, we experienced one of the worst economic downturns in recent history.  This coupled with a tightening of supplier credit, price decreases, increased competition from other distributors added by manufacturers and decreased demand, we are confident we have made the right decision to reduce our dependency on the distribution business.  As a result we have turned our attention towards designing and developing our own products  specifically 3G/ 4G wireless routing firmware and hardware.  After 18 months of testing, field trials, customer driven enhancements and modifications, we not only understand the customer requirements and the market verticals but have better control on the business and the challenges facing it. Being less dependent on the commodity based distribution business, we are now  positioned to commercialize our proprietary router solutions and increase and broaden our  revenue streams.  Our planned revenue growth and return to profitability is expected to come as a result of the introduction of our (1) innovative and patent pending proprietary technology, (2) the launch of our new suite of products catering to the growing 3G/4G wireless business segment and (3) an experienced sales and operations team focused on the wireless marketplace.  This is dependent on our ability to raise new capital.



With our base of current customers and a diversified expanding  market, we believe our new suite of products will create one-time and recurring revenue, potentially yielding higher gross profit margins as compared to the legacy distribution business.



Notwithstanding the historical operating results over the last 18 months, management believes that the true value of our Company rests in the changes and progress made over the past 12 months which should provide a unique and sustainable competitive advantage.  With the introductions of our new router solutions, management intends to leverage our existing loyal customer base, enhance our fulfillment expertise to provide unique packaging and delivery of the NexWareSM software, develop new markets, add new customers, strengthen our business relationships with strategic vendors and continue to be innovative in developing software and firmware to meet our customers needs.  We intend to continue to strengthen our management and board of directors by attracting seasoned executives with marketing, finance and technical expertise from the wireless and wireline industries.



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Looking forward for the next 12 months, we believe that we have established a strong foundation of IP (Intellectual Property), industry relationships, quality assurance methodologies and proprietary enabling technology, NexWareSM, which can be readily adapted to meet the needs of specific partners and markets. Our objectives over the next 12 months are to continue to build value inside the business and move our company to a more profitable stage of growth. To support this growth, we are seeking short term equity of $3-5 million over the next 3-6 months.  This further investment will provide the capital necessary to drive our new business model, launch our new products, meet our customers needs and increase shareholder value.



In order to exploit our current technological advantage, quickly penetrate the market and accelerate our aggressive business plans, management is seeking to raise $5 million USD, in two tranches; $3 million by February 2010 and $2 million on or before June 30, 2010. This $5 million USD will top off the $4 million invested to date which has allowed us to successfully restructure and re-focus the company. The proceeds of the $5 million will be used to launch the sales and marketing campaign and allow management to achieve profitability from operations and which we believe will increase shareholder value.  The funds will also be used for general working capital.



Year Ended October 31, 2009 Compared to Year Ended October 31, 2008



Total revenues for the year ended October 31, 2009 amounted to $5,643,840 compared to $12,128,852 for the same period in 2008. The decrease in revenues for the twelve months compared to the twelve month period in 2008 was primarily attributable to one of the worst economic downturns in recent history, the tightening of supplier credit, price decreases, increased competition from other distributors added by manufacturers, a decrease in product demand and the disruption in the supply of data cards from one of our suppliers.   Gross profit for the year ended October 31, 2009 amounted to $1,035,738 or 18.35% of total revenues.  This compares to gross profit of $2,397,358 or 19.76% of total revenues for the twelve months ended October 31, 2008.  The decrease in gross margin for the twelve months ended October 31, 2009 is primarily due to some of the Companys inventory reaching end of life status.  Management implemented a sales plan to liquidate this end of life inventory at reduced sales price to end users and increase in our  obsolescence provision related to slow moving inventory.



Total operating expenses amounted to $4,079,224 for the twelve months ended October 31, 2009 compared to $3,507,203 for the same period in 2008.  This $572,021 increase primarily relates to selling, general and administrative expense comprising of re-organizational costs incurred during the year, including increased payroll and related costs, and consulting fees, totaling $543,000 related to the hiring of additional sales and administrative personnel.  In addition, increased audit and legal costs associated with the Share Exchange Agreement and the audit of the 2007, 2008 and 2009 consolidated financial statements in accordance with the Public Company Accounting Oversight Board (PCAOB) totaling $152,000 increased our selling and general administrative expenses during the year. This increase was offset by a decrease in bad debt expense of $189,000 as a result of a settlement entered into with a customer.



Interest and other expense increased $209,300 to $353,563 for the twelve months ending October 31, 2009 compared to $144,263 as of October 31, 2008 as a result in increased cost of borrowings, primarily in connection with the convertible debenture and working capital loans provided by related parties.



The loss from operations amounted to $3,043,486 for the year ended October 31, 2009 compared to a loss of $1,109,845 for same period in 2008.  The increase is due to lower sales and increased costs as noted above.  Net loss after interest and income taxes amounted to $3,373,635 for the year ended October 31, 2009, an increase of $2,342,641 over the same period in 2008. With the sales of our new line of routers expected gain traction in fiscal 2010 and a continued demand and supply of broadband data cards, it is anticipated that the companys losses will decrease year over year, commencing the third quarter of FY 2010.



Liquidity and Financial Condition



Working Capital

|                             |   |                |   |   |          
|---------------------------- | - | -------------- | - | - | ---------
|                             |   | At October 31,
|                             |   | 2009           |   |   | 2008     
|Current assets               | $ | 1,332,777      |   | $ | 3,213,232
|Current liabilities          |   | 5,046,387      |   |   | 2,742,172
|Working capital (deficiency) | $ | (3,713,610     | ) | $ | 471,060  



Our cash on hand as at October 31, 2009 was $260,067. As at October 31, 2009, we had working capital deficiency of $3,713,610. Included in current liabilities at October 31, 2009 is a convertible debenture in the amount of $1,950,000 of which $1,600,000 was converted into equity on November 10, 2009. Current liabilities also include promissory notes payable to related parties in the aggregate of $681,349, of which $502,262 of this amount was converted to equity on January 6, 2010.  We have incurred operating losses since 2008, and this is likely to continue for the year ending October 31, 2010.



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We anticipate that our cash on hand and the revenue that we anticipate generating from product sales will not be sufficient to satisfy all of our cash requirements for the next twelve month period. We plan to raise additional capital primarily through the equity financing and further borrowings from our current shareholders and directors if this type of funding continues to be available. We will continue to seek additional funds from our current shareholders and directors to fund our day to day operations until equity financing can be pursued but we have no guarantee that our current shareholders and directors will continue to fund our day to day operations.



We have been focused on changing our business model to include the development of our own line of software to compliment the distribution side of our business. During this period we have experienced a decline in revenues resulting in negative cash flow from operations. We have a total shareholders deficit of $2,358,789. As discussed in Note 1 of the Notes to the Consolidated Financial Statements, we have incurred losses from operations and have negative cash flow from operations, a working capital and a net capital deficit that raise substantial doubt about our ability to continue as a going concern. Managements plans in regard to these matters are also described in Note 1 of the Notes to the Consolidated Financial Statements. The Consolidated Financial Statements do not include any adjustments that might result from the outcome of this uncertainty.  Our ability to continue as a going concern depends on our success in generating increased revenues and earnings in the immediate and foreseeable future with the introduction of our new line of hardware and software router products and solutions. Furthermore, the continuation of our company as a going concern is dependent upon the continued financial support from our shareholders and lenders and our ability to obtain necessary equity financing to continue operations.  The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.



Future Fundraising



Fundraising will be one of our primary objectives over the next 12 months. We anticipate our cash requirements for the next 12 months to carry out our business plan will be $3 million.  We do not anticipate generating positive internal operating cash flow until we can generate substantial revenues from the commercial sale of our new line of hardware and software router products and solutions. We intend to raise $3 to $5 million of our cash requirements through equity financings by June 2010.



As noted above, the financial requirements of our company for the next twelve months will depend on our ability to raise the money we require through debt financing and private placements associated with the issuance of additional equity securities of our company to our current stockholders and/or new stockholders. The issuance of additional equity securities by us may result in a significant dilution in the equity interests of our current stockholders. There is no assurance that we will be able to obtain further funds required for our continued operations or that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, we will not be able to meet our other obligations as they become due and we will be forced to scale down or perhaps even cease our operations.



Off-Balance Sheet Arrangements



We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.



Application of Critical Accounting Policies



The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of net revenue and expenses in the reporting period. We regularly evaluate our estimates and assumptions related to inventory valuation and warranty liabilities, which affect our cost of sales and gross margin; the valuation of intangibles, including software development costs, and patents and trademarks, which could in the future affect our impairment charges to write down the carrying value of intangibles and the amount of related periodic amortization expense recorded for definite-lived intangibles;; and the valuation of deferred income taxes, which affects our income tax expense (benefit). We also have other key accounting policies, such as our policies for stock-based compensation and revenue recognition, including the deferral of a portion of revenues on sales to distributors. The methods, estimates and judgments we use in applying these critical accounting policies have a significant impact on the results we report in our financial statements. We base our estimates and assumptions on historical experience and on various other factors that we 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. The actual results experienced by us may differ materially and adversely from managements estimates. To the extent there are material differences between our estimates and the actual results, our future results of operations will be affected.





19



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We believe the following critical accounting policies require us to make significant judgments and estimates in the preparation of our consolidated financial statements.



Fair Value of Financial Instruments



We have adopted and follow ASC 820-10,Fair Value Measurements and Disclosuresfor measurement and disclosures about fair value of our financial instruments.  ASC 820-10 establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820-10 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels.  The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.  The three (3) levels of fair value hierarchy defined by ASC 820-10 are:



Level 1 Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.



Level 2 Inputs (other than quoted market prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instruments anticipated life.





Level 3 Inputs reflect managements best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Valuation of instruments includes unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities.



As defined by ASC 820-10, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale, which was further clarified as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date.  The carrying amounts of our financial assets and liabilities, such as cash and cash equivalents, prepaids and other current assets,  and other assets, accounts payable, accrued expenses, accrued interest, taxes payable, and other current liabilities, approximate their fair values because of the short maturity of these instruments.  Our notes payable to shareholders, long-term debt, bridge credit facility and convertible debenture approximate the fair value of such instruments based upon managements best estimate of interest rates that would be available to us for similar financial arrangements at October 31, 2009 and 2008.



We do not have any assets or liabilities measured at fair value on a recurring or a non-recurring basis, consequently, we did not have any fair value adjustments for assets and liabilities measured at fair value at October 31, 2009, nor gains or losses reported in our statement of operations that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date.



Inventories



Our inventories consist of 3G mobile broadband routers, PC cards, modems and other accessories, and are carried at the lower of average cost, determined on a first-in-first-out (FIFO) basis, or market. The Company reviews inventory for significant average cost variances over market on a quarterly basis. We also write down inventory for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions.  If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.



Warranty Reserves



Our wireless router products typically carry a one year warranty.  We establish reserves for estimated product warranty costs at the time revenue is recognized. Although we engage in extensive product quality programs and processes, our warranty obligation is affected by product failure rates, use of materials and service delivery costs incurred in correcting any product failure.  We calculate a warranty provision using historical data to estimate the percentage of our wireless router products that will require repairs or replacements during the warranty period.   Management reviews and updates its estimates as actual warranty expenditures change over the products life cycle. Should actual product failure rates, use of materials or service delivery costs differ from managements estimates, additional warranty reserves could be required, which could reduce gross margin.



20



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Impairment of Long-Lived Assets



We review the carrying value of our long-lived assets, which include property and equipment, and intangible assets (other than goodwill) annually or whenever events or changes in circumstances indicate that the historical cost-carrying value of an asset may no longer be appropriate in accordance with Statement of ASC 360-10-35, Property, Plant and Equipment  Subsequent Measurement.We assess recoverability of the carrying value of the asset by estimating the future net cash flows expected to result from the asset, including eventual disposition.  The estimate of cash flows is based upon, among other things, certain assumptions about expected future operating performance, growth rates and other factors. Estimates of undiscounted cash flows may differ from actual cash flows due to, among other things, technological changes, economic conditions, changes to the business model or changes in operating performance. If the sum of the undiscounted cash flows (excluding interest) is less than the carrying value, an impairment loss will be recognized, measured as the amount by which the carrying value exceeds the fair value of the asset. Fair value is determined using available market data, comparable asset quotes and/or discounted cash flow models.   Management conducted an evaluation of long-lived assets and determined no impairments currently exist.



Software Development Costs



We capitalize software development costs in accordance with ASC 985-20 (SFAS No. 86, Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed).   Software development costs consist of labor and overhead costs related to development of the Company’s suite of NexWareTM firmware for the Company’s suite of wireless routers.  Software development costs are capitalized when technological feasibility and marketability of the related product has been established.  On June 1, 2008, the Company established technological feasibility upon successful completion and testing of the Companys first working router product pilot firmware program.   Capitalized software costs will be amortized on a product-by-product basis, three to five years, beginning when the product is available for general release to customers. As of October 31, 2009 and 2008, the Company capitalized $1,043,009 and $315,817, respectively, in connection with software development costs.  Interest in the amount of $10,852 and $36,293 was capitalized and included in software development costs for the year ended October 31, 2009 and 2008, respectively. General release of the Companys software product is expected to occur at the end of May 2010.  Therefore, no amortization expense has been was recorded to date.



Intangible Assets



Our intangible assets, consist principally of patents and trademarks, are accounted for in accordance with ASC 350.30, formerly known as SFAS No. 142, Goodwill and Other Intangibles.  Intangible assets that have finite lives are amortized using the straight-line method over their estimated useful lives of fifteen years.



Valuation of Deferred Income Taxes



We record valuation allowances to reduce our deferred tax assets to an amount that we believe is more likely than not to be realized. We consider estimated future taxable income and ongoing prudent and feasible tax planning strategies, including reversals of deferred tax liabilities, in assessing the need for a valuation allowance. If we were to determine that we will not realize all or part of our deferred tax assets in the future, we would make an adjustment to the carrying value of the deferred tax asset, which would be reflected as income tax expense. Conversely, if we were to determine that we will realize a deferred tax asset, which currently has a valuation allowance, we would reverse the valuation allowance which would be reflected as an income tax benefit or as an adjustment to shareholders equity. For financial statement reporting purposes, we must make certain estimates and judgments. These estimates and judgments are applied in the calculation of certain tax liabilities and in the determination of the recoverability of deferred tax assets, which arise from temporary differences between the recognition of assets and liabilities for tax and financial statement reporting purposes.



Revenue Recognition



We recognize revenue, net of sales tax, when all four basic criteria are met: 1) there is evidence that an arrangement exists; 2) delivery has occurred; 3) the fee is fixed or determinable; and 4) collectability is reasonably assured.  In addition, we do not recognize revenue until all of the customers acceptance criteria have been met. The criteria are usually met at the time of product shipment, except for shipments to distributors with rights of return.  We defer the portion of revenue from shipments to distributors subject to rights of return until the agreed upon percentage of return or cancellation privileges lapse. Revenue recognition related to customization services and provisioning is recognized when services are performed.



21



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Stock-Based Compensation Expense



We account for stock-based compensation in accordance with the provisions of ASC 718,Stock Compensation, formerly known as SFAS No. 123R, which requires all share-based payments to be recognized in our financial statements based on their respective grant date fair values. Under this standard, the fair value of each employee stock option is estimated on the date of grant using an option pricing model that meets certain requirements.   Consistent with the provisions of ASC 718, we estimate the fair value of stock options and shares issued under its employee stock purchase plan using the Black-Scholes option-pricing model.  Fair value is estimated on the date of grant and is then recognized (net of estimated forfeitures) as expense in our Consolidated Statement of Operations over the requisite service period (generally the vesting period).   ASC 718 requires that we estimate the fair value of stock-based compensation on the date of grant using an option-pricing model. The Company uses the Black-Scholes model to value stock-based compensation.  The Black-Scholes model determines the fair value of stock-based payment awards based on the stock price on the date of grant and is affected by assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to our expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. Option-pricing models were developed for use in estimating the value of traded options that have no vesting or hedging restrictions and are fully transferable. Although the fair value of stock options granted by us is determined in accordance with ASC 718 and Staff Accounting Bulletin (SAB) No. 107,Share-Based Payment,(SAB 107) as amended by SAB No. 110,using an option-pricing model, this value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction.



Recent Accounting Pronouncements



In September 2009, Financial Accounting Standards Board (FASB) issued ASC 605-25, Revenue Recognition - Multiple-Deliverable Revenue Arrangements,formerly Emerging Issues Task Force (EITF) 00-21. This guidance addresses how to separate deliverables and how to measure and allocate consideration to one or more units of accounting. Specifically, the guidance requires that consideration be allocated among multiple deliverables based on relative selling prices. The guidance establishes a selling price hierarchy of (1) vendor-specific objective evidence, (2) third-party evidence and (3) estimated selling price. This guidance is effective for annual periods beginning after December 15, 2009 but may be early adopted as of the beginning of an annual period. The Company is currently evaluating the effect that this guidance will have on its consolidated financial position and results of operations.



In June 2009, the FASB issued SFAS No. 168,The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles  a replacement of FASB Statement No. 162,now referred to as ASC 105-10,Generally Accepted Accounting Principles. The FASB Accounting Standards Codification (Codification) will become the source of authoritative U.S. generally accepted accounting principles (GAAP) recognized by FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of this statement, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other non-grandfathered non-SEC accounting literature not included in the Codification will become non-authoritative. This statement is effective for financial statements issued for interim and annual periods ending after September 30, 2009.  The adoption of this statement did not have a material effect on the Companys consolidated financial statements.



In June 2009, the FASB issued SFAS No. 165,later codified in ASC 855-10, Subsequent Events. ASC 855-10 establishes general standards of for the evaluation, recognition and disclosure of events and transactions that occur after the balance sheet date. Although there is new terminology, the standard is based on the same principles as those that currently exist in the auditing standards. The standard, which includes a new required disclosure of the date through which an entity has evaluated subsequent events, is effective for interim or annual periods ending after June 15, 2009.  The adoption of ASC 855-10 did not have a material effect on the Companys consolidated financial statements.



In April 2009, the FASB issued FASB Staff Position No. 107-1 and APB Opinion No. 28-1 (FSP 107-1 and APB 28-1), later codified in ASC 825-10-65-1, Interim Disclosures about Fair Value of Financial Instruments. FSP 107-1 and APB 28-1 require fair value disclosures in both interim, as well as annual, financial statements in order to provide more timely information about the effects of current market conditions on financial instruments. FSP 107-1 and APB 28-1 became effective for the Company in the quarter ended July 31, 2009, and their adoption did not have a material impact on the Company's consolidated financial statements.



22



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In June 2008, the EITF ratified EITF Issue No. 07-5, Determining Whether an Instrument (or Embedded Feature) Is Indexed to an Entitys Own Stock, now referred to as ASC 815-40-15. ASC 815-40-15 provides guidance in assessing whether derivative instruments meet the criteria in paragraph 11(a) of SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, now referred to as ASC 815, for being considered indexed to an entitys own common stock. ASC 815-40-15 is effective for fiscal years beginning after December 15, 2008. We have completed our evaluation of the impact of ASC 815-40-15 and believe the impact was immaterial based on the nature of our derivative and hedging activities.



In April 2008, the FASB issued FSP FAS 142-3, Determination of the Useful Life of Intangible Assets, now referred to as FASB ASC 350-30-65-1. It amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under SFAS No. 142, Goodwill and Intangible Assets, now referred to as ASC 350. ASC 350-30-65-1 is effective for fiscal years beginning after December 15, 2008 and may not be adopted early. The adoption of this statement is not expected to have a material effect on the Company's consolidated financial statements.



In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities  an amendment to FASB Statement No. 133,now referred to as ASC 815. ASC 815 is intended to improve financial standards for derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity's financial position, financial performance, and cash flows. Entities are required to provide enhanced disclosures about: (a) how and why an entity uses derivative instruments; (b) how derivative instruments and related hedged items are accounted for under SFAS No. 133 and its related interpretations; and (c) how derivative instruments and related hedged items affect an entitys financial position, financial performance, and cash flows.  ASC 815 is effective for financial statements issued for fiscal years beginning after November 15, 2008, with early adoption encouraged. The adoption of this statement is not expected to have a material effect on the Company's consolidated financial statements.



In December 2007, the FASB issued SFAS No.141R, Business Combinations, now referred to as ASC 805. ASC 805 establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree. The statement also provides guidance for recognizing and measuring the goodwill acquired in the business combination and determines what information to disclose to enable users of the financial statements to evaluate and financial effects of the business combination.  The guidance will become effective for the fiscal year beginning after December 15, 2008. The adoption of this statement is not expected to have a material effect on the Company's consolidated financial statements, unless the Company enters into a material business combination transaction. The Company believes that the adoption of ASC 805 would have an impact on the accounting for any future acquisition, if one were to occur.



In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements  an amendment of ARB No. 51, now referred to as ASC 810. ASC 810 establishes accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. The guidance will become effective for the fiscal year beginning after December 15, 2008. The adoption of this statement is not expected to have a material effect on the Company's consolidated financial statements.



ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISKS.



Not applicable.



ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA



23



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NEXAIRA WIRELESS INC.



(formerly Technology Publishing, Inc.)





|                                                                                         |      
|---------------------------------------------------------------------------------------- | -----
|                                                                                         | Index
|                                                                                        
|Report of Independent Registered Accounting Firm                                         | F2  
|                                                                                         |      
|Consolidated Balance Sheets                                                              | F3  
|                                                                                         |      
|Consolidated Statements of Operations                                                    | F4  
|                                                                                         |      
|Consolidated Statements of Cash Flows                                                    | F5  
|                                                                                         |      
|Consolidated Statement of Shareholders (Deficit) Equity and Comprehensive Income (Loss) | F6  
|                                                                                         |      
|Notes to the Consolidated Financial Statements                                           | F7  







F-1



---

Report of Independent Registered Public Accounting Firm





Board of Directors and Stockholders

NexAira Wireless Inc. and Subsidiaries

San Diego, California

We have audited the accompanying consolidated balance sheets of NexAira Wireless Inc. and Subsidiaries as of October 31, 2009 and 2008 and the related consolidated statements of operations, shareholders equity (deficit) and comprehensive income (loss), and cash flows for the years then 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 audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audits 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.  An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of NexAira Wireless Inc. and Subsidiaries at October 31, 2009 and 2008, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has incurred losses from operations and has negative cash flow from operations, a working capital and a net capital deficit that raise substantial doubt about its ability to continue as a going concern. Managements plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ BDO Seidman, LLP

San Diego, California

January 29, 2010



F-2



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NEXAIRA WIRELESS INC. AND SUBSIDIARIES

(formerly Technology Publishing, Inc.)



Consolidated Balance Sheets



|                                  |             |           |  |  |   |           | 
|--------------------------------- | ----------- | --------- |  |  | - | --------- | 
|                                  | October 31,
|                                  |             | 2009      |  |  |   | 2008      | 
|ASSETS                           
|Current assets:                   |             |           |  |  |   |           | 
|Cash and cash equivalents         | $           | 260,067   |  |  | $ | 421,700   | 
|Accounts receivable, net          |             | 204,163   |  |  |   | 1,132,588 | 
|Inventories, net                  |             | 671,082   |  |  |   | 1,445,465 | 
|Income tax receivable             |             | 110,140   |  |  |   | 110,140   | 
|Prepaids and other current assets |             | 87,325    |  |  |   | 103,339   | 
|Total current assets              |             | 1,332,777 |  |  |   | 3,213,232 | 
|                                 
|Property and equipment, net       |             | 226,089   |  |  |   | 290,591   | 
|                                 
|Other assets:                     |             |           |  |  |   |           | 
|Software development costs        |             | 1,043,009 |  |  |   | 315,817   | 
|Patents and trademarks            |             | 85,723    |  |  |   | 22,921    | 
|Security deposit                  |             | -         |  |  |   | 10,157    | 
|Total other assets                |             | 1,128,732 |  |  |   | 348,895   | 
|                                 
|TOTAL ASSETS                      | $           | 2,687,598 |  |  | $ | 3,852,718 | 

LIABILITIES AND SHAREHOLDERS (DEFICIT) EQUITY

|                                                                 |   |            |   |  |   |           |  
|---------------------------------------------------------------- | - | ---------- | - |  | - | --------- | -
|Current liabilities:                                             |   |            |   |  |   |           |  
|Convertible debenture, net                                       | $ | 1,950,000  |   |  | $ | 481,183   |  
|Bridge credit facility                                           |   | -          |   |  |   | 500,000   |  
|Note payable to vendor, net                                      |   | 865,453    |   |  |   | -         |  
|Accounts payable                                                 |   | 632,452    |   |  |   | 1,432,626 |  
|Promissory notes payable to related parties, net                 |   | 681,349    |   |  |   | -         |  
|Note payable to bank                                             |   | 84,972     |   |  |   | 27,609    |  
|Accrued expenses and other current liabilities                   |   | 799,969    |   |  |   | 300,754   |  
|Due to shareholders                                              |   | 32,192     |   |  |   | -         |  
|Total current liabilities                                        |   | 5,046,387  |   |  |   | 2,742,172 |  
|Long-term debt                                                   |   | -          |   |  |   | 75,389    |  
|TOTAL LIABILITIES                                                |   | 5,046,387  |   |  |   | 2,817,561 |  
|                                                                
|Commitments and contingencies                                    |   |            |   |  |   |           |  
|                                                                
|Shareholders (deficit) equity:                                  |   |            |   |  |   |           |  
|Common stock, $0.001 par value:                                  |   |            |   |  |   |           |  
|Authorized shares  539,200,000                                  |   |            |   |  |   |           |  
|Issued and outstanding  36,329,262 and 15,489,262, respectively |   | 36,329     |   |  |   | 15,489    |  
|Additional paid-in capital                                       |   | 1,504,289  |   |  |   | 1,482,926 |  
|Accumulated deficit                                              |   | (3,824,143 | ) |  |   | (450,508  | )
|Other comprehensive loss:                                        |   |            |   |  |   |           |  
|Foreign exchange translation                                     |   | (75,264    | ) |  |   | (12,750   | )
|TOTAL SHAREHOLDERS (DEFICIT) EQUITY                             |   | (2,358,789 | ) |  |   | 1,035,157 |  
|TOTAL LIABILITIES AND SHAREHOLDERS (DEFICIT) EQUITY             | $ | 2,687,598  |   |  | $ | 3,852,718 |  



See Accompanying Notes to Consolidated Financial Statements



F-3



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NEXAIRA WIRELESS INC. AND SUBSIDIARIES

(formerly Technology Publishing, Inc.)



Consolidated Statements of Operations



|                                                                                                 |                                |            |   |  |   |            |  
|------------------------------------------------------------------------------------------------ | ------------------------------ | ---------- | - |  | - | ---------- | -
|                                                                                                 | For the Year Ended October 31, |           
|                                                                                                 |                                | 2009       |   |  |   | 2008       |  
|                                                                                                
|Revenues:                                                                                        |                                |            |   |  |   |            |  
|Products                                                                                         | $                              | 5,587,128  |   |  | $ | 11,890,562 |  
|Services                                                                                         |                                | 56,712     |   |  |   | 238,290    |  
|Total revenues                                                                                   |                                | 5,643,840  |   |  |   | 12,128,852 |  
|                                                                                                
|Cost of revenues:                                                                                |                                |            |   |  |   |            |  
|Products                                                                                         |                                | 4,604,277  |   |  |   | 9,512,473  |  
|Services                                                                                         |                                | 3,825      |   |  |   | 219,021    |  
|Total cost of revenues                                                                           |                                | 4,608,102  |   |  |   | 9,731,494  |  
|Gross profit                                                                                     |                                | 1,035,738  |   |  |   | 2,397,358  |  
|                                                                                                
|Operating expenses:                                                                              |                                |            |   |  |   |            |  
|Research and development                                                                         |                                | 419,751    |   |  |   | 440,170    |  
|Selling, general and administrative                                                              |                                | 3,659,473  |   |  |   | 3,067,033  |  
|Total operating expenses                                                                         |                                | 4,079,224  |   |  |   | 3,507,203  |  
|Loss from operations                                                                             |                                | (3,043,486 | ) |  |   | (1,109,845 | )
|                                                                                                
|Other (expense) income:                                                                          |                                |            |   |  |   |            |  
|Interest and other income                                                                        |                                | 22,792     |   |  |   | 127,845    |  
|Interest and other expense                                                                       |                                | (353,563   | ) |  |   | (144,263   | )
|Total other (expense) income                                                                     |                                | (330,771   | ) |  |   | (16,418    | )
|Loss from operations before income taxes                                                         |                                | (3,374,257 | ) |  |   | (1,126,263 | )
|Income tax benefit                                                                               |                                | 622        |   |  |   | 95,269     |  
|Net loss                                                                                         | $                              | (3,373,635 | ) |  | $ | (1,030,994 | )
|                                                                                                
|Per share data:                                                                                  |                                |            |   |  |   |            |  
|Weighted average shares outstanding used in computation of basic and diluted net loss per share: |                                |            |   |  |   |            |  
|Basic and diluted                                                                                |                                | 21,928,056 |   |  |   | 13,256,157 |  
|                                                                                                
|Net loss per share:                                                                              |                                |            |   |  |   |            |  
|Basic and diluted                                                                                | $                              | (0.15      | ) |  | $ | (0.08      | )



See Accompanying Notes to Consolidated Financial Statements



F-4



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NEXAIRA WIRELESS INC. AND SUBSIDIARIES

(formerly Technology Publishing, Inc.)



Consolidated Statements of Cash Flows



|                                                                            |      |                                |      |  |   |            |  
|--------------------------------------------------------------------------- | ---- | ------------------------------ | ---- |  | - | ---------- | -
|                                                                            |      | For the Year Ended October 31, |     
|                                                                            | 2009 |                                | 2008
|                                                                           
|Cash flows from operating activities:                                       |      |                                |      |  |   |            |  
|Net loss                                                                    | $    | (3,373,635                     | )    |  | $ | (1,030,994 | )
|Adjustments to reconcile net loss to net cash used in operating activities: |      |                                |      |  |   |            |  
|Depreciation and amortization                                               |      | 133,961                        |      |  |   | 104,519    |  
|Loss on disposal of fixed assets                                            |      | 9,668                          |      |  |   | 6,202      |  
|Provision for bad debts                                                     |      | 19,000                         |      |  |   | 183,543    |  
|Provision for inventory obsolescence                                        |      | 257,917                        |      |  |   | 29,802     |  
|Warranty reserve                                                            |      | 30,301                         |      |  |   | 45,000     |  
|Stock-based compensation expense                                            |      | 15,871                         |      |  |   | 131,171    |  
|Net liabilities assumed in connection with Share Exchange Agreement         |      | (77,905                        | )    |  |   | -          |  
|Net liabilities transferred with the sale of Westside Publishing Ltd.       |      | 27,056                         |      |  |   | -          |  
|Accretion of discount on debt                                               |      | 52,766                         |      |  |   | 9,183      |  
|Change in deferred taxes                                                    |      | -                              |      |  |   | (6,000     | )
|Changes in operating assets and liabilities:                                |      |                                |      |  |   |            |  
|Accounts receivable                                                         |      | 909,425                        |      |  |   | 496,281    |  
|Inventories                                                                 |      | 516,466                        |      |  |   | 1,083,357  |  
|Income tax receivable                                                       |      | -                              |      |  |   | (110,140   | )
|Prepaids and other current assets                                           |      | 10,829                         |      |  |   | 166,481    |  
|Security deposit                                                            |      | -                              |      |  |   | 1,231      |  
|Accounts payable                                                            |      | 495,122                        |      |  |   | (1,913,596 | )
|Accrued expenses and other current liabilities                              |      | 468,914                        |      |  |   | (247,831   | )
|Net cash used in operating activities                                       |      | (504,244                       | )    |  |   | (1,051,791 | )
|Cash flows from investing activities:                                       |      |                                |      |  |   |            |  
|Purchases of property and equipment                                         |      | (63,785                        | )    |  |   | (249,863   | )
|Software development costs                                                  |      | (727,192                       | )    |  |   | (315,817   | )
|Patents and trademarks                                                      |      | (62,802                        | )    |  |   | (22,921    | )
|Net cash used in investing activities                                       |      | (853,779                       | )    |  |   | (588,601   | )
|Cash flows from financing activities:                                       |      |                                |      |  |   |            |  
|Net proceeds from convertible debenture                                     |      | 950,000                        |      |  |   | 464,332    |  
|Proceeds from bridge credit facility                                        |      | -                              |      |  |   | 500,000    |  
|Net proceeds from borrowings from related parties                           |      | 687,394                        |      |  |   | -          |  
|Repayment of note payable to vendor                                         |      | (392,656                       | )    |  |   | -          |  
|Repayment of note payable to bank                                           |      | (18,026                        | )    |  |   | (85,029    | )
|Advances from shareholder                                                   |      | 32,192                         |      |  |   | -          |  
|Repayment of notes payable to shareholders                                  |      | -                              |      |  |   | (37,967    | )
|Net cash provided by financing activities                                   |      | 1,258,904                      |      |  |   | 841,336    |  
|Effect of exchange rate changes on cash                                     |      | (62,514                        | )    |  |   | 46,215     |  
|Net decrease in cash and cash equivalents                                   |      | (161,633                       | )    |  |   | (752,841   | )
|Cash and cash equivalents at beginning of period                            |      | 421,700                        |      |  |   | 1,174,541  |  
|Cash and cash equivalents at end of period                                  | $    | 260,067                        |      |  | $ | 421,700    |  



See Accompanying Notes to Consolidated Financial Statements



F-5



---

NEXAIRA WIRELESS INC. AND SUBSIDIARIES

(formerly Technology Publishing, Inc.)



Consolidated Statements of Changes in Shareholders (Deficit) Equity and Comprehensive Income (Loss)



|                                                                                                                       |             |   |   |                                 |   |   |                                                          |   |   |                                                    |   |   |            |   |   |                                  |   |   |            |  
|---------------------------------------------------------------------------------------------------------------------- | ----------- | - | - | ------------------------------- | - | - | -------------------------------------------------------- | - | - | -------------------------------------------------- | - | - | ---------- | - | - | -------------------------------- | - | - | ---------- | -
|                                                                                                                       |             |   |   | Additional
      Paid-inCapital |   |   | Accumulated
      Other
      ComprehensiveIncome (Loss) |   |   | Retained
      Earnings
      (AccumulatedDeficit) |   |   |            |   |   | Comprehensive
      Income(Loss) |  
|Common                                                                                                                
|                                                                                                                       | Stock       |   |   | Amount                          |   |   |                                                          |   |   |                                                    |   |   | Total      |   |   |                                 
|BALANCE OCTOBER 31, 2007                                                                                               | 9,625,354   |   | $ | 9,625                           |   | $ | 329,619                                                  |   | $ | (58,965                                            | ) | $ | 580,486    |   | $ | 860,765                          |   |   |            |  
|Conversion of convertible debenture into common stock                                                                  | 5,645,162   |   |   | 5,645                           |   |   | 994,355                                                  |   |   |                                                    |   |   |            |   |   | 1,000,000                        |   |   |            |  
|Issuance of additional shares in connection with repricing shares previously issued in conversion of convertible loans | 218,746     |   |   | 219                             |   |   | (219                                                     | ) |   |                                                    |   |   |            |   |   | -                                |   |   |            |  
|Issuance of stock options in connection with amendment of convertible debenture                                        |             |   |   |                                 |   |   | 28,000                                                   |   |   |                                                    |   |   |            |   |   | 28,000                           |   |   |            |  
|Stock-based compensation                                                                                               |             |   |   |                                 |   |   | 131,171                                                  |   |   |                                                    |   |   |            |   |   | 131,171                          |   |   |            |  
|Net loss                                                                                                               |             |   |   |                                 |   |   |                                                          |   |   |                                                    |   |   | (1,030,994 | ) |   | (1,030,994                       | ) | $ | (1,030,994 | )
|Foreign exchange translation                                                                                           |             |   |   |                                 |   |   |                                                          |   |   | 46,215                                             |   |   |            |   |   | 46,215                           |   |   | 46,215     |  
|Total comprehensive loss                                                                                               |             |   |   |                                 |   |   |                                                          |   |   |                                                    |   |   |            |   |   |                                  |   | $ | (984,779   | )
|                                                                                                                      
|BALANCE OCTOBER 31, 2008                                                                                               | 15,489,262  |   |   | 15,489                          |   |   | 1,482,926                                                |   |   | (12,750                                            | ) |   | (450,508   | ) |   | 1,035,157                        |   |   |            |  
|                                                                                                                      
|Repricing of stock options in connection with amendment of convertible debenture                                       |             |   |   |                                 |   |   | 25,806                                                   |   |   |                                                    |   |   |            |   |   | 25,806                           |   |   |            |  
|Issuance of warrants in connection with related party debt                                                             |             |   |   |                                 |   |   | 12,000                                                   |   |   |                                                    |   |   |            |   |   | 12,000                           |   |   |            |  
|Issuance of warrants to vendor in connection with Amended Note Payable Agreement                                       |             |   |   |                                 |   |   | 39,375                                                   |   |   |                                                    |   |   |            |   |   | 39,375                           |   |   |            |  
|Issuance of common stock for Share Exchange Agreement with Technology Publishing, Inc.,                                | 81,640,000  |   |   | 81,640                          |   |   | (159,545                                                 | ) |   |                                                    |   |   |            |   |   | (77,905                          | ) |   |            |  
|Sales of Westside Publishing                                                                                           |             |   |   |                                 |   |   |                                                          |   |   |                                                    |   |   |            |   |   |                                  |   |   |            |  
|Ltd. for cancellation of common stock                                                                                  | (40,800,000 | ) |   | (40,800                         | ) |   | 67,856                                                   |   |   |                                                    |   |   |            |   |   | 27,056                           |   |   |            |  
|                                                                                                                      
|Return and cancelation of common shares by former officer and director of Technology Publishing                        | (20,000,000 | ) |   | (20,000                         | ) |   | 20,000                                                   |   |   |                                                    |   |   |            |   |   | -                                |   |   |            |  
|Stock-based compensation                                                                                               |             |   |   |                                 |   |   | 15,871                                                   |   |   |                                                    |   |   |            |   |   | 15,871                           |   |   |            |  
|Net loss                                                                                                               |             |   |   |                                 |   |   |                                                          |   |   |                                                    |   |   | (3,373,635 | ) |   | (3,373,635                       | ) | $ | (3,373,635 | )
|Foreign exchange translation                                                                                           |             |   |   |                                 |   |   |                                                          |   |   | (62,514                                            | ) |   |            |   |   | (62,514                          | ) |   | (62,514    | )
|Total comprehensive loss                                                                                               |             |   |   |                                 |   |   |                                                          |   |   |                                                    |   |   |            |   |   |                                  |   | $ | (3,436,149 | )
|                                                                                                                      
|BALANCE OCTOBER 31, 2009                                                                                               | 36,329,262  |   | $ | 36,329                          |   | $ | 1,504,289                                                |   | $ | (75,264                                            | ) | $ | (3,824,143 | ) | $ | (2,358,789                       | ) |   |            |  



See Accompanying Notes to Consolidated Financial Statements



F-6



---

NEXAIRA WIRELESS INC. AND SUBSIDIARIES

(formerly Technology Publishing, Inc.)



Notes to Consolidated Financial Statements

For the Years Ended October 31, 2009 and 2008



1.

THE COMPANY



Nexaira Wireless, Inc. (the Company), formerly known as Technology Publishing, Inc. (TPI) was incorporated in the State of Nevada on March 19, 2007. The Company is headquartered in Vancouver, British Columbia Canada and its principal operations are located in San Diego, California.  The Company develops and distributes 3G mobile wireless broadband and router solutions, as well as communications software to wireless operators, distributors, original equipment manufacturers (OEMs), and vertical markets worldwide. The Company also provides customization services, marketing tools, provisioning and airtime activations based on individual customer needs. The Company is publicly traded on the Over-the-Counter Bulletin Board (OTCBB) under the symbol NXWI and can be found on the worldwide web at www.nexaira.com.



Nexaira Inc. (Nexaira) incorporated as M2M Wireless Ltd on November 11, 2004 under the Alberta, Canada Business Corporations Act. On June 8, 2005 Nexaira incorporated its wholly-owned subsidiary in the State of California under the name Nexaira, Inc., and effected a name change of its Canadian parent corporation to Nexaira Inc. effective December 12, 2005 to better reflect its business and marketing opportunities. On September 28, 2009, the shareholders of Nexaira entered into a Share Exchange Agreement with TPI and its wholly-owned subsidiary, Westside Publishing Ltd, a private Canadian based company under common control, whereby Nexaira merged with and into TPI, with Nexaira remaining as the surviving corporation. For financial statement reporting purposes, the merger was treated as a reverse acquisition with Nexaira deemed the accounting acquirer and TPI deemed the accounting acquiree under the purchase method of accounting in accordance with ASC 805-10-40, Business Combinations  Reverse Acquisitions.The reverse merger is deemed a recapitalization and the consolidated financial statements represent the continuation of the financial statements of Nexaira (the accounting acquirer/legal subsidiary) except for is capital structure, and the consolidated financial statements reflect the assets and liabilities of Nexaira recognized and measured at their carrying value before the combination and the assets and liabilities of TPI (the legal acquiree/legal parent).  The equity structure reflects the equity structure of TPI, the legal parent, and the equity structure of Nexaira, the accounting acquirer, as restated using the exchange ratios established in the Share Exchange Agreement to reflect the numbers of shares of the legal parent.  .



Effective October 26, 2009 the merger was completed with TPI, a Nevada Corporation which was incorporated solely to effect a change in TPIs name from Technology Publishing, Inc. to Nexaira Wireless, Inc..  The name change became effective with the OTCBB at the opening for trading on November 2, 2009 under the new stock symbol NXWI. In connection with the closing of the share exchange agreement, the officers of TPI resigned, with Nexairas officers and directors duly appointed.



Effective October 29, 2009, the Company entered into a Share Purchase Agreement with TPIs former officer and director, whereby the Company divested Westside Publishing Ltd. as consideration for the cancellation of 40.8 million shares of the Companys restricted common stock.   In addition, on October 29, 2009, the Company entered into a return to treasury agreement with a former shareholder, whereby the former shareholder agreed to return 20,000,000 restricted common shares to the company for cancellation effective October 30, 2009.



See Note 3  Share Exchange Agreement.



Going Concern



The accompanying consolidated financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business.  The accompanying consolidated financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern.  The Company has experienced a decline in revenues, and has negative cash flows from operations, negative working capital and capital deficits, which raise substantial doubt about the Company's ability to continue as a going concern.  The ability of the Company to continue as a going concern and appropriateness of using the going concern basis is dependent upon, among other things, an additional cash infusion.  As discussed in Note 7  Bridge Credit Facility and Convertible Debenture, the Company has obtained funds from related parties since its inception through the date of this report, January 29, 2010. Management believes this funding will  continue,  and  is  also  actively  seeking  new  investors. Management  believes  the existing  shareholders  and prospective  new investors  will provide the  additional  cash needed to meet the  Company's obligations as they become due, and will allow the  development of its core business.



F-7



---

Recent tightening of the credit markets and unfavorable economic conditions has led to a low level of liquidity in many financial markets and extreme volatility in the credit and equity markets.  As contemplated by the share exchange agreement, described in Note 3, entered into on September 28, 2009, management expects to access the equity markets to raise cash in the near future.  The Company plans to raise $3 to $5 million within the next three to six months through equity financing.   However, there is no assurance that the Company will be successful in securing additional capital.   In addition, if signs of improvement in the global economy do not progress as expected and the economic slowdown continues or worsens, the Companys business, financial condition, cash flows and results of operations will be adversely affected. If that happens, the Companys ability to access the capital or credit markets may worsen and it may not be able to obtain sufficient capital to satisfy or refinance all of its outstanding debt obligations as the obligations are required to be paid.  The Company is dependent on the continued financial support of its principal shareholder and convertible debenture investor.  If the Company is unable to achieve projected operating results and/or obtain the additional contemplated financing, management will be required to curtail growth plans and reduce development activities.  Should the Company not be able to obtain new capital required to it would have to renegotiate the terms of its existing loan agreements with a supplier and related parties.  The Company will be required to consider strategic and other alternatives, including, among other things, the sale of assets to generate funds, the negotiation of revised terms of its indebtedness, additional exchanges of its existing indebtedness obligations for new securities and additional equity offerings. The Company has retained financial advisors to assist it in considering these strategic, restructuring or other alternatives. There is no assurance that the Company will be successful in completing any of these alternatives.  The Companys failure to satisfy or refinance any of its indebtedness obligations as they come due, including through additional exchanges of new securities for existing indebtedness obligations or additional equity offerings, including through additional exchanges of new securities for existing indebtedness obligations or additional equity offerings, will result in a default and potential acceleration of its remaining indebtedness obligations and will have a material adverse effect on its business and continuance as a going concern.



2.

SIGNIFICANT ACCOUNTING POLICIES



Principles of Consolidation



The Companys consolidated financial statements are prepared using accounting principles generally accepted in the United States of America and include the accounts of the Company, and its wholly-owned subsidiary, Nexaira, Inc., a California Corporation.   All significant intercompany accounts and transactions have been eliminated.



Foreign Currency



The functional currency of the Companys Canadian operations is the Canadian dollar.  Assets and liabilities of the Companys Canadian operations are translated into U.S. dollars at end-of-period exchange rates. Revenues and expenses are translated at average exchange rates in effect for the period. Net currency exchange gains or losses resulting from such translations are excluded from net income and are accumulated in a separate component of shareholders equity as accumulated other comprehensive income (loss). Gains and losses resulting from foreign currency, which are not significant, are included in the consolidated statements of operations.



Use of Estimates



The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and also requires disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Significant estimates made by management include revenue recognition estimates, the valuation of deferred income tax assets, the valuation of equity instruments, allowance for doubtful accounts, inventory obsolescence and warrants issued in connection with debt.



F-8



---

Revenue Recognition



The Company recognizes revenue, net of sales tax, when all four basic criteria are met: 1) there is evidence that an arrangement exists; 2) delivery has occurred; 3) the fee is fixed or determinable; and 4) collectability is reasonably assured.  In addition, the Company does not recognize revenue until all customers acceptance criteria have been met. The criteria are usually met at the time of product shipment, except for shipments to distributors with rights of return.  The portion of revenue from shipments to distributors subject to rights of return is deferred until the agreed upon percentage of return or cancellation privileges lapse.   Revenue recognition related to customization services and provisioning is recognized when services are performed.  In accordance with FASB ASC 605-45 (Emerging Issues Task Force (EITF) Issue No. 00-10,Accounting for Shipping and Handling Fees and Costs), the Company includes shipping and handling fees billed to customers in net revenues. Amounts incurred by the Company for freight are included in cost of goods sold.



Computation of Income and Loss per Share



The Company computes income and loss per share in accordance with ASC 260, formerly SFAS No. 128, Earnings per Share.  ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the statements of operations. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive.



Fair Value of Financial Instruments



The Company has adopted and follows ASC 820-10,Fair Value Measurements and Disclosuresfor measurement and disclosures about fair value of its financial instruments.  ASC 820-10 establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820-10 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels.  The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.  The three (3) levels of fair value hierarchy defined by ASC 820-10 are:



Level 1 Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.



Level 2 Inputs (other than quoted market prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instruments anticipated life.



Level 3 Inputs reflect managements best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Valuation of instruments includes unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities.



As defined by ASC 820-10, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale, which was further clarified as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date.  The carrying amounts of the Companys financial assets and liabilities, such as cash and cash equivalents, prepaids and other current assets,  and other assets, accounts payable, accrued expenses, accrued interest, taxes payable, and other current liabilities, approximate their fair values because of the short maturity of these instruments.  The Companys notes payable to shareholders, long-term debt, bridge credit facility and convertible debenture approximates the fair value of such instrument based upon managements best estimate of interest rates that would be available to the Company for similar financial arrangements at October 31, 2009 and 2008.



F-9



---

The Company does not have any assets or liabilities measured at fair value on a recurring or a non-recurring basis, consequently, the Company did not have any fair value adjustments for assets and liabilities measured at fair value at October 31, 2009, nor gains or losses reported in the statement of operations that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date.



Concentration of Credit Risk



Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, trade accounts receivable, revenue and suppliers.



The Companys cash and cash equivalents are placed at financial institutions, which at times, may exceed federally insured limits. Generally, these deposits may be redeemed upon demand and, therefore, bear minimal risk.   Effective October 3, 2008, the Emergency Economic Stabilization Act of 2008 raised the Federal Deposit Insurance Corporation deposit coverage limits to $250,000 per owner from $100,000 per owner. This program is currently available through December 31, 2013.   The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risk on cash and cash equivalents.



The Company provides products and services to a variety of customers worldwide.  Concentration of credit risk with respect to revenues and trade receivables is limited due to the geographic and industry dispersion of the Companys customer base. The Company has not experienced significant credit losses on its customer accounts.  A small number of customers has typically accounted for a large percentage of the Companys annual revenues and trade accounts receivable.  Three customers accounted for 23%, 17% and 16%, respectively, of the Companys revenues for the year ended October 31, 2009.   Two customers accounted for 11% and 10%, respectively, of the Companys revenues for the year ended October 31, 2008.   Two customers accounted for 26% and 17%, respectively, of trade accounts receivable as of October 31, 2009.  As of October 31, 2008, four customers accounted for 16%, 15%, 12% and 11% of outstanding trade accounts receivable.



The Company relied on two and four suppliers, respectively, to provide 76% and 90% of total inventory purchases for the years ended October 31, 2009 and 2008, respectively.



Cash and Cash Equivalent



The Company considers all highly liquid investments with an original maturity from the date of purchase of 90 days or less to be cash equivalents.  Cash and cash equivalents consist of cash on hand and in banks, and credit card receivables.



Accounts Receivable



Accounts receivable are recorded at the invoice amount at the time of sale.  The Company continually monitors the collectability of its trade receivables based on a combination of factors. The Company records specific allowances for bad debts in selling, general and administrative expense when the Company becomes aware of a specific customers inability to meet its financial obligation, and all collection efforts are exhausted.  As of October 31, 2009 and 2008, the allowance for doubtful accounts was $19,000 and $183,543, respectively.



Inventories



Inventories consist of 3G mobile broadband routers, PC cards, modems and other accessories, and are carried at the lower of average cost, determined on a first-in-first-out (FIFO) basis, or market. The Company reviews inventory for significant average cost variances over market on a quarterly basis. The Company also writes down inventory for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions.  If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required. As of October 31, 2009 and 2008, inventory obsolescence reserve totaled $306,586 and $49,248, respectively.



F-10



---

Property and Equipment



Property and equipment are stated at cost and depreciated using the straight-line method, generally over the following periods:

| |                                                 |                                                               
| | ----------------------------------------------- | --------------------------------------------------------------
| |                                                 | Period                                                        
| | Computer equipment and related                  | 3 years                                                       
| | Computer software and website development costs | 3 years                                                       
| | Office and lab equipment                        | 5 years                                                       
| | Furniture and fixtures                          | 5 years                                                       
| | Leasehold improvements                          | Based on lease term, or the lesser of the remaining lease term



Improvements to leased property are amortized using the straight-line method over the lesser of the remaining term of the lease or the estimated useful lives of the improvements. Direct external and internal costs of developing software for the Companys website, as well as accounting software for internal use, are capitalized, and depreciated when placed into service.  Expenditures for ordinary repairs and maintenance are expensed as incurred.



Impairment of Long-Lived Assets



In accordance with Statement of ASC 360-10-35, Property, Plant and Equipment  Subsequent Measurement, formerly known as SFAS No. 144, the Company reviews the carrying value of its long-lived assets, which includes property and equipment, and intangible assets (other than goodwill) annually or whenever events or changes in circumstances indicate that the historical cost-carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the carrying value of the asset by estimating the future net cash flows expected to result from the asset, including eventual disposition.  The estimate of cash flows is based upon, among other things, certain assumptions about expected future operating performance, growth rates and other factors. Estimates of undiscounted cash flows may differ from actual cash flows due to, among other things, technological changes, economic conditions, changes to the business model or changes in operating performance. If the sum of the undiscounted cash flows (excluding interest) is less than the carrying value, an impairment loss will be recognized, measured as the amount by which the carrying value exceeds the fair value of the asset. Fair value is determined using available market data, comparable asset quotes and/or discounted cash flow models.   Management conducted an evaluation of long-lived assets and determined no impairments currently exist.



Research and Development Costs



Internal costs relating to research and development costs incurred for new software products and enhancements to existing products, other than certain software development costs that qualify for capitalization, are expensed as incurred.



Software Development Costs



The Company capitalizes software development costs in accordance with ASC 985-20 (SFAS No. 86,Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed).Software development costs consist of labor and overhead costs related to development of the Company’s suite of NexWareTM firmware for the Company’s suite of wireless routers.  Software development costs are capitalized when technological feasibility and marketability of the related product has been established.  On June 1, 2008, the Company established technological feasibility upon successful completion and testing of the Companys first working router product pilot firmware program.   Capitalized software costs will be amortized on a product-by-product basis, three to five years, beginning when the product is available for general release to customers.   As of October 31, 2009 and 2008, the Company capitalized $1,043,009 and $315,817, respectively, in connection with software development costs.   Interest in the amount of $10,852 and $36,293 was capitalized and included in software development costs for the year ended October 31, 2009 and 2008, respectively.  General release of the Companys software product is expected to occur at the end of May 2010.  Therefore, no amortization expense has been was recorded to date.



Intangible Assets



Intangible assets, consisting principally of patents and trademarks, are accounted for in accordance with ASC 350.30, formerly known as SFAS No. 142,Goodwill and Other Intangibles.  Intangible assets that have finite lives are amortized using the straight-line method over their estimated useful lives of fifteen years.



F-11



---

Warranty Reserves



The Companys wireless router products typically carry a one year warranty.  Reserves are established for estimated product warranty costs at the time revenue is recognized. Although the Company engages in extensive product quality programs and processes, its warranty obligation is affected by product failure rates, use of materials and service delivery costs incurred in correcting any product failure.  The Company calculates a warranty provision using historical data to estimate the percentage of its wireless router products will require repairs or replacements during the warranty period.   Management reviews and updates its estimates as actual warranty expenditures change over the products life cycle.     Should actual product failure rates, use of materials or service delivery costs differ from the Companys estimates, additional warranty reserves could be required, which could reduce gross margin.



The following table summarizes warranty reserve activity, which is included in accrued expenses and other current liabilities in the Consolidated Balance Sheets, as of October 31, 2009 and 2008:



| |                             |             |         |      |   |       
| | --------------------------- | ----------- | ------- | ---- | - | ------
| |                             | October 31,
| |                             | 2009        |         | 2008
|
| | Beginning balance           | $           | 45,000  |      | $ | -     
| | Charged to cost of revenues |             | 30,301  |      |   | 45,000
| | Charges incurred            |             | (68,080 | )    |   | -     
| | Ending balance              | $           | 7,221   |      | $ | 45,000



Advertising Expense



The Company expenses all advertising costs, which are included in selling, general and administrative in the Consolidated Statements of Operations, as they are incurred.  Advertising expense for the years ended October 31, 2009 and 2008 totaled $48,637 and $12,537, respectively.



Income Taxes



The Company accounts for income taxes under ASC 740-10, Income Taxes. Deferred income tax assets and liabilities are recognized based on differences between the financial statement and tax basis of assets and liabilities using presently enacted tax rates.  At each balance sheet date, the Company evaluates the available evidence about future taxable income and other possible sources of realization of deferred tax assets, and records a valuation allowance that reduces the deferred tax assets to an amount that represents managements best estimate of the amount of such deferred tax assets that more likely than not will be realized.  Deferred tax assets and liabilities are measured using 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 rates is recognized in the statements of operations in the period that includes the enactment date.



In fiscal year 2008, the Company adopted amendments under ASC 740-10-50, Accounting for Uncertain Tax Positions, formerly Financial Accounting Standards Board Interpretation No. 48 (FIN 48), which clarify the accounting for uncertainty in tax positions recognized in the financial statements. Under these provisions, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position would be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The related amendments also provide guidance on measurement, classification, interest and penalties associated with tax positions, and income tax disclosures.



The Company is subject to taxation in the U.S., Canada, and various state jurisdictions. The Companys calculation of its tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in various taxing jurisdictions. If, based on new facts that arise within a period, management ultimately determines that the payment of these liabilities will be unnecessary, the liability will be reversed and the Company will recognize a tax benefit during the period in which it is determined the liability no longer applies. Conversely, the Company records additional tax charges in a period in which it is determined that a recorded tax liability is less than the ultimate assessment is expected to be.



The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability for U.S., Canadian taxes, or the various state jurisdictions, may be materially different from managements estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities. Interest and penalties are included in tax expense.



F-12



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Stock-based Compensation



The Company accounts for stock-based compensation in accordance with the provisions of ASC 718, Stock Compensationformerly known as SFAS No. 123R, which establishes the accounting for share-based awards and the inclusion of their fair value in net earnings in the respective periods the awards were earned. Consistent with the provisions of ASC 718, the Company estimates the fair value of stock options and shares issued under its employee stock purchase plan using the Black-Scholes option-pricing model.  Fair value is estimated on the date of grant and is then recognized (net of estimated forfeitures) as expense in the Consolidated Statement of Operations over the requisite service period (generally the vesting period).



ASC 718 requires companies to estimate the fair value of stock-based compensation on the date of grant using an option-pricing model. The Company uses the Black-Scholes model to value stock-based compensation.  The Black-Scholes model determines the fair value of stock-based payment awards based on the stock price on the date of grant and is affected by assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to the Companys expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. Option-pricing models were developed for use in estimating the value of traded options that have no vesting or hedging restrictions and are fully transferable. Although the fair value of stock options granted by the Company is determined in accordance with ASC 718 and Staff Accounting Bulletin (SAB) No. 107,Share-Based Payment,(SAB 107) as amended by SAB No. 110,using an option-pricing model, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction.



The fair value of the options granted is estimated using the Black-Scholes option-pricing model assumptions listed in the following table:



| |                         |              
| | ----------------------- | -------------
| | Dividend yield          | 0%           
| | Expected volatility     | 50% - 60%    
| | Risk free interest rate | 1.31% - 2.89%
| | Expected lives          | 3 years      
| | Expected forfeitures    | 10% - 33%    



Compensation Amortization Period.All stock-based compensation is amortized over the requisite service period of the awards, which is generally the same as the vesting period of the awards. The Company amortizes the fair value on a straight-line basis over the expected service period, less estimated forfeitures.



Expected Life.The expected life of stock options granted represents the expected weighted average period of time from the date of grant to the estimated date that the stock option would be fully exercised.



Expected Volatility.Expected volatility is a measure of the amount by which the stock price is expected to fluctuate. Due to limited volatility history, the Company estimates the expected volatility of its stock options at their grant date by equally weighting the historical volatility of four similar public companies.



Risk-Free Interest Rate.The risk-free interest rate is the implied yield currently available on zero-coupon government issues with a remaining term equal to the expected life.



Expected Dividends.The Company has never paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future. Consequently, the Company uses an expected dividend yield of zero percent in valuation models.



Expected Forfeitures.As stock-based compensation expense is based on awards that are ultimately expected to vest, it should be reduced for estimated forfeitures.  ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Pre-vesting forfeitures rates were based upon the average of expected forfeitures data using the Companys current demographics and standard probabilities of employee turnover and the annual forfeiture rate based on the Companys historical forfeiture rates.



F-13



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The Company retained an independent valuation firm to analyze its valuation methodology of the fair market value used in determining compensation expense under ASC 718.  The independent valuation firm supported managements assumptions that the fair market value of the Companys common stock was reasonable.



The amount of unearned stock-based compensation currently estimated to be expensed from now through fiscal 2012 related to unvested share-based payment awards at October 31, 2009 is $10,385. The weighted-average period over which the unearned stock-based compensation is expected to be recognized is approximately 2.5 years. If there are any modifications or cancellations of the underlying unvested securities, the Company may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense.  The Company modified the exercise price of these outstanding options in March 2009.  The additional incremental expense related to the modification was expensed over the remaining term.  Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that the Company grants additional equity awards or assumes unvested equity awards in connection with acquisitions.



Segments of a Business Enterprise



The Company currently operates in one reportable operating segment.  ASC 250, formerly SFAS No. 131,Disclosures about Segments of an Enterprise and Related Information, establishes standards for the way public business enterprises report information about operating segments in annual consolidated financial statements and requires that those enterprises report selected information about operating segments in interim financial reports.  ASC 250 also establishes standards for related disclosures about products and services, geographic areas and major customers.  Although the Company had two operating segments at October 31, 2009, under aggregation criteria set forth in ASC 250, the Company operates in only one reportable operating segment.



Under ASC 250, two or more operating segments may be aggregated into a single operating segment for financial reporting purposes if aggregation is consistent with the objective and basic principles of ASC 250, if the segments have similar economic characteristics, and if the segments are similar in each of the following areas:



| |   |                                                                         
| | - | ------------------------------------------------------------------------
| | - | the nature of products and services;                                    
| | - | the nature of the production processes;                                 
| | - | the type or class of customer for their products and services; and      
| | - | the methods used to distribute their products or provide their services.



Because the Company meets each of the criteria set forth in ASC 250 and the two operating segments as of October 31, 2009 share similar economic characteristics, the Company aggregates its results of operations into one reportable operating segment.   The Companys revenues are derived from geographic locations primarily located in the United States and Canada.



Recent Accounting Pronouncements



In September 2009, Financial Accounting Standards Board (FASB) issued ASC 605-25,Revenue Recognition - Multiple-Deliverable Revenue Arrangement,formerly Emerging Issues Task Force (EITF) 00-21. This guidance addresses how to separate deliverables and how to measure and allocate consideration to one or more units of accounting. Specifically, the guidance requires that consideration be allocated among multiple deliverables based on relative selling prices. The guidance establishes a selling price hierarchy of (1) vendor-specific objective evidence, (2) third-party evidence and (3) estimated selling price. This guidance is effective for annual periods beginning after December 15, 2009 but may be early adopted as of the beginning of an annual period. The Company is currently evaluating the effect that this guidance will have on its consolidated financial position and results of operations.



In June 2009, the FASB issued SFAS No. 168,The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles  a replacement of FASB Statement No. 162,now referred to as ASC 105-10,Generally Accepted Accounting Principles. The FASB Accounting Standards Codification (Codification) will become the source of authoritative U.S. generally accepted accounting principles (GAAP) recognized by FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of this statement, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other non-grandfathered non-SEC accounting literature not included in the Codification will become non-authoritative. This statement is effective for financial statements issued for interim and annual periods ending after September 30, 2009.  The adoption of this statement did not have a material effect on the Companys consolidated financial statements.



F-14



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In June 2009, the FASB issued SFAS No. 165,later codified in ASC 855-10,Subsequent Events. ASC 855-10establishes general standards of for the evaluation, recognition and disclosure of events and transactions that occur after the balance sheet date. Although there is new terminology, the standard is based on the same principles as those that currently exist in the auditing standards. The standard, which includes a new required disclosure of the date through which an entity has evaluated subsequent events, is effective for interim or annual periods ending after June 15, 2009.  The adoption of ASC 855-10 did not have a material effect on the Companys consolidated financial statements.



In April 2009, the FASB issued FASB Staff Position No. 107-1 and APB Opinion No. 28-1 (FSP 107-1 and APB 28-1), later codified in ASC 825-10-65-1, Interim Disclosures about Fair Value of Financial Instruments. FSP 107-1 and APB 28-1 require fair value disclosures in both interim, as well as annual, financial statements in order to provide more timely information about the effects of current market conditions on financial instruments. FSP 107-1 and APB 28-1 became effective for the Company in the quarter ended July 31, 2009, and their adoption did not have a material impact on the Company's consolidated financial statements.



In June 2008, the EITF ratified EITF Issue No. 07-5,Determining Whether an Instrument (or Embedded Feature) Is Indexed to an Entitys Own Stock, now referred to as ASC 815-40-15. ASC 815-40-15 provides guidance in assessing whether derivative instruments meet the criteria in paragraph 11(a) of SFAS No. 133,Accounting for Derivative Instruments and Hedging Activities, now referred to as ASC 815, for being considered indexed to an entitys own common stock. ASC 815-40-15 is effective for fiscal years beginning after December 15, 2008. We have completed our evaluation of the impact of ASC 815-40-15 and believe the impact was immaterial based on the nature of our derivative and hedging activities.



In April 2008, the FASB issued FSP FAS 142-3, Determination of the Useful Life of Intangible Assets, now referred to as FASB ASC 350-30-65-1. It amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under SFAS No. 142, Goodwill and Intangible Assets, now referred to as ASC 350. ASC 350-30-65-1 is effective for fiscal years beginning after December 15, 2008 and may not be adopted early. The adoption of this statement is not expected to have a material effect on the Company's consolidated financial statements.



In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities  an amendment to FASB Statement No. 133,now referred to as ASC 815. ASC 815 is intended to improve financial standards for derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity's financial position, financial performance, and cash flows. Entities are required to provide enhanced disclosures about: (a) how and why an entity uses derivative instruments; (b) how derivative instruments and related hedged items are accounted for under SFAS No. 133 and its related interpretations; and (c) how derivative instruments and related hedged items affect an entitys financial position, financial performance, and cash flows.  ASC 815 is effective for financial statements issued for fiscal years beginning after November 15, 2008, with early adoption encouraged. The adoption of this statement is not expected to have a material effect on the Company's consolidated financial statements.



In December 2007, the FASB issued SFAS No.141R, Business Combinations, now referred to as ASC 805. ASC 805 establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree. The statement also provides guidance for recognizing and measuring the goodwill acquired in the business combination and determines what information to disclose to enable users of the financial statements to evaluate and financial effects of the business combination.  The guidance will become effective for the fiscal year beginning after December 15, 2008. The adoption of this statement is not expected to have a material effect on the Company's consolidated financial statements, unless the Company enters into a material business combination transaction. The Company believes that the adoption of ASC 805 would have an impact on the accounting for any future acquisition, if one were to occur.



In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements  an amendment of ARB No. 51, now referred to as ASC 810. ASC 810 establishes accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. The guidance will become effective for the fiscal year beginning after December 15, 2008. The adoption of this statement is not expected to have a material effect on the Company's consolidated financial statements.



F-15



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3.

SHARE EXCHANGE AGREEMENT



On September 28, 2009, the shareholders of Nexaira entered into a Share Exchange Agreement with Technology Publishing, Inc. (TPI), a Company publicly traded on the Over-the-Counter Bulletin Board (OTCBB) and its wholly-owned subsidiary, Westside Publishing Ltd, a private Canadian based company under common control, whereby the Company merged with and into TPI, with the Company remaining as the surviving corporation.  The merger transaction  contained several elements that were contemplated to be completed within seven  business days from September 29, 2009.   The series of transactions included 1) the purchase of Westside  Publishing Ltd. by the former president and a shareholder of TPI for the return  of 40,800,000 shares of common stock; 2) the return of 20,000,000 shares of TPI  stock in exchange for indemnification to a former director for his actions as  an officer and director of TPI; and 3) the mandatory conversion of  Nexaira’s $1,600,000 convertible debt, that  was assumed by TPI,  into 19,250,000  shares of common stock. (See Note 16 – Subsequent Event).  The Company determined there were no amounts  to record as a liability for the indemnification provided to the former  director because of the limited operations.   Because the acquisition was predicated on these transactions it was  accounted for as one combined event.  For financial statement reporting purposes, the merger was treated as a recapitalization with the Company deemed the accounting acquirer and TPI deemed the accounting acquiree under the purchase method of accounting in accordance with ASC 805-10-40, Business Combinations  Reverse Acquisitions.The reverse merger is deemed a capital transaction and the net assets of the Company (the accounting acquirer) are carried forward to TPI (the legal acquirer and the reporting entity) at their carrying value before the combination.  The acquisition process utilizes the capital structure of TPI and the assets and liabilities of the Company which are recorded at historical cost.  The equity of TPI is the historical equity of the Company retroactively restated to reflect the number of shares issued by TPI in the transaction.



Effective September 29, 2009, the closing date of the transaction:



(i)

TPI acquired all of the issued and outstanding common shares of the Company from its shareholders in consideration of 15,489,262 common shares of TPI on the basis of 1.75 shares for every one share of the Companys common stock;



(ii)

TPI acquired all of the outstanding warrants of the Company from 0793296 B.C. Ltd and 885084 Alberta Inc. in consideration of the granting of 1,575,000 warrants on the basis of 1.75 warrant for every one Nexaira warrant previously issued, with each of the warrants entitling the holder to purchase one share of the common stock;



(iii)

TPI acquired all of the outstanding options of the Company in consideration for granting 9,529,034 options of TPI, on the basis of 1.75 options for every one option of the Company, with each options entitling the holder to purchase one share of the common stock of the Company; and



(iv)

Pursuant to the terms of an assumption agreement, TPI assumed debt in the amount of $1,600,000 owed by the Company to 0793296 B.C. Ltd, being a portion of a convertible debenture in the principal amount of $1,950,000 owed by the Company to 0793296 B.C. Ltd.



Effective October 26, 2009 the merger was completed with TPI, a Nevada corporation which was incorporated solely to effect a change in TPIs name from Technology Publishing, Inc. to Nexaira Wireless, Inc..  The name change became effective with the OTCBB at the opening for trading on November 2, 2009 under the new stock symbol NXWI.



In connection with the closing of the Share Exchange Agreement, the officers of TPI resigned, with the Companys officers and directors duly appointed.



Effective October 29, 2009, the Company entered into a Share Purchase Agreement with TPIs former officer and director, whereby the Company divested Westside Publishing Ltd. as consideration for the cancellation of 40.8 million shares of the Companys restricted common stock.   In addition, on October 29, 2009, the Company entered into a return to treasury agreement with a former shareholder, whereby the former shareholder agreed to return 20,000,000 restricted common shares to the company for cancellation effective October 30, 2009.



F-16



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4.

SUPPLEMENTAL BALANCE SHEET INFORMATION



Inventories



Inventories consist of the following:

| |                                     |             |          |      |  |   |           |  
| | ----------------------------------- | ----------- | -------- | ---- |  | - | --------- | -
| |                                     | October 31,
| |                                     | 2009        |          | 2008
| | Broadband cards                     | $           | 183,112  |      |  | $ | 648,768   |  
| | Modules                             |             | 398,101  |      |  |   | 367,313   |  
| | Routers                             |             | 302,469  |      |  |   | 428,898   |  
| | Routers held by distributors        |             | 28,057   |      |  |   | -         |  
| | Accessories and branding collateral |             | 65,929   |      |  |   | 49,734    |  
| |                                     |             | 977,668  |      |  |   | 1,494,713 |  
| | Less allowance for obsolescence     |             | (306,586 | )    |  |   | (49,248   | )
| |                                     | $           | 671,082  |      |  | $ | 1,445,465 |  



Property and equipment



Property and equipment consist of the following:

| |                                                 |             |          |      |  |   |         |  
| | ----------------------------------------------- | ----------- | -------- | ---- |  | - | ------- | -
| |                                                 | October 31,
| |                                                 | 2009        |          | 2008
| | Computer equipment and related                  | $           | 199,804  |      |  | $ | 156,143 |  
| | Computer software and website development costs |             | 119,093  |      |  |   | 119,093 |  
| | Office and lab equipment                        |             | 42,411   |      |  |   | 27,665  |  
| | Furniture and fixtures                          |             | 26,800   |      |  |   | 38,492  |  
| | Leasehold improvements                          |             | 17,947   |      |  |   | 15,468  |  
| |                                                 |             | 406,055  |      |  |   | 356,861 |  
| | Less accumulated depreciation and amortization  |             | (179,966 | )    |  |   | (66,270 | )
| |                                                 | $           | 226,089  |      |  | $ | 290,591 |  



Depreciation expense for the years ended October 31, 2009 and 2008 totaled $118,619 and $49,132, respectively.



Accrued expenses and other current liabilities



Accrued expenses and other current liabilities consist of the following:

| |                          |             |         |      |  |   |         | 
| | ------------------------ | ----------- | ------- | ---- |  | - | ------- | 
| |                          | October 31,
| |                          | 2009        |         | 2008
| | Payroll and related      | $           | 174,922 |      |  | $ | 150,226 | 
| | Deferred consulting fees |             | 179,025 |      |  |   | -       | 
| | Interest payable         |             | 168,460 |      |  |   | 12,005  | 
| | Other                    |             | 277,562 |      |  |   | 138,523 | 
| |                          | $           | 799,969 |      |  | $ | 300,754 | 



5.

SUPPLEMENTAL CASH FLOW INFORMATION



| |                            |                                |         |      |  |   |         | 
| | -------------------------- | ------------------------------ | ------- | ---- |  | - | ------- | 
| |                            | For the Year Ended October 31,
| |                            | 2009                           |         | 2008
|
| | Cash paid for interest     | $                              | 149,765 |      |  | $ | 119,627 | 
| | Cash paid for income taxes | $                              | 1,100   |      |  | $ | 142,388 | 
| |                            |                                |         |      |  |   |         | 
| |                            |                                |         |      |  |   |         | 



F-17



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| |                                                                                                                                          |   |         |  |  |   |           | 
| | ---------------------------------------------------------------------------------------------------------------------------------------- | - | ------- |  |  | - | --------- | 
| | Non-cash financing and investing activities:                                                                                             |   |         |  |  |   |           | 
| | Accounts payable transferred to notes payable to vendor (See Note 8)                                                                     | $ | 938,296 |  |  | $ | -         | 
| | Accounts payable transfer to notes payable to vendor in connection with Amended and Restated Workout Agreement (See Note 8)              | $ | 357,000 |  |  | $ | -         | 
| | Issuance of warrants in connection with notes payable to vendor                                                                          | $ | 39,375  |  |  | $ | -         | 
| | Transfer of Bridge Credit Facility to Convertible Debenture in connection with Loan Amending Agreement #3 (See Note 7)                   | $ | 500,000 |  |  | $ | -         | 
| | Repricing of stock options in connection with amendment of convertible debenture                                                         | $ | 25,806  |  |  | $ | -         | 
| | Issuance of warrants in connection with working capital loans from related parties                                                       | $ | 12,000  |  |  | $ | -         | 
| | Cancellation of common shares in connection with sale of Westside Publishing, Ltd.                                                       | $ | 40,800  |  |  | $ | -         | 
| | Return and cancelation of common shares by former officer and director of Technology Publishing, Inc.                                    | $ | 20,000  |  |  | $ | -         | 
| | Conversion of convertible debenture into common stock                                                                                    | $ | -       |  |  | $ | 1,000,000 | 
| | Accounts receivable, property and equipment, and prepaids transferred to shareholders in conjunction with repayment of shareholder loans | $ | -       |  |  | $ | 125,027   | 
| | Issuance of stock options in connection with amendment of convertible debenture                                                          | $ | -       |  |  | $ | 28,000    | 



6.

NET LOSS PER SHARE



Basic earnings per share (EPS) exclude dilution and is computed by dividing net income or loss by the weight-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. Potentially dilutive securities, which currently comprise of options and convertible debenture, are excluded from the diluted EPS computation in loss periods and when their exercise price is greater than the market price as their effect would be anti-dilutive.



A reconciliation of weighted-average basic shares outstanding to weighted-average diluted shares outstanding follows:



| |                                                                         |                                |  |      |            | 
| | ----------------------------------------------------------------------- | ------------------------------ |  | ---- | ---------- | 
| |                                                                         | For the Year Ended October 31,
| |                                                                         | 2009                           |  | 2008
| | Basic weighted average common shares outstanding                        | 21,928,056                     |  |      | 13,256,157 | 
|
| | Effect of dilutive securities:                                          |                                |  |      |            | 
| | Convertible debenture                                                   | -                              |  |      | -          | 
| | Stock options                                                           | -                              |  |      | -          | 
|
| | Diluted weighted average common and potential common shares outstanding | 21,928,056                     |  |      | 13,256,157 | 



As of October 31, 2009, shares reserved for the convertible debenture, warrants and options to purchase common stock totaled approximately 21,254,034, 2,012,500 and 8,400,000, respectively. These were excluded from the calculation of diluted earnings per share as their effect was anti-dilutive.   As of October 31, 2008, shares reserved for the convertible debenture and options to purchase common stock totaled approximately 6,533,333 and 6,457,500, respectively, and were excluded.



F-18



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7.

BRIDGE CREDIT FACILITY AND CONVERTIBLE DEBENTURE



On June 19, 2007, the Company entered into a Convertible Loan Agreement with 0793296 B.C. Ltd, a related party (the Lender), for total borrowings of up to $3,000,000, of which $1,000,000 was advanced under the terms of the agreement on June 19, 2007.  The convertible loan bears interest at 12% per annum, and matured one year from the date of the initial advance, and any subsequent advances thereon. The Lender had the option to convert all or part of the principal amounts advanced into one share for every $0.80 of the outstanding principal, for total up to 2,187,500 shares of the Companys common stock. The convertible loan is secured by principally all of the Companys assets, including the Companys 100% ownership interest in its U.S. subsidiary.



On February 28, 2008, the Company entered into Loan Amending Agreement (Amendment 1) revising the conversion price of the principal amounts advanced under the Convertible Loan Agreement into one share for every $0.31 of the outstanding principal, for total up to 5,645,162 shares. Under Amendment 1, the Lender also advanced an additional $500,000 on March 5, 2008.  The additional advance is subject to 12% interest, and is convertible upon the election of the Lender into one share for every $0.50 of the outstanding principal balance and accrued interest thereon.



On March 19, 2008, the Lender converted the original $1,000,000 advanced into 5,645,162 shares of common stock of the Company.



On July 3, 2008, the Company entered into a second Loan Amending Agreement (Amendment 2) to provide for a Bridge Credit Facility (Credit Facility) for maximum amount available of $500,000. The credit facility bears interest of 12% per annum, and is secured by accounts receivable. The facility was utilized to purchase inventory. Amendment 2 also revised the conversion price of the additional principal advanced and any advances under the Credit Facility, and any accrued interest thereon, at the option of the Lender from one share for every $0.50, as revised in Amendment 1, to $0.45. The Lender advanced $250,000 on July 11, 2008 and September 8, 2008, respectively, for total borrowings outstanding under the Credit Facility of $500,000 as of October 31, 2008.



Under Amendment 2, the Company also granted the Lender an option to purchase up to 400,000 shares of common stock at the exercise price of $0.50 per share. The option expires in two years from the date of Amendment 2.  The Company recognized the fair value of the options granted to the Lender under the Black-Scholes model totaling $28,000 as debt discount.



On November 7, 2008, the Company entered into a Loan Amending Agreement (Agreement 3) converting the Bridge Credit Facility totaling $500,000 into a subsequent advance under the terms of the Convertible Loan Agreement.  The Lender is entitled to convert principal and accrued interest thereon into one share of common stock for every $0.31. In addition, under Amendment 3, the Company cancelled the stock option agreement issued under Amendment 2 on July 3, 2008.  The Company issued a new stock option agreement to purchase up to 1,129,034 shares of common stock at the exercise price of $0.31. The Company recognized the fair value of the cancelation and reissuance of the options granted to the Lender under the Black-Scholes model totaling $25,806 as debt discount.



On November 24, 2008 and January 26, 2009 the Company borrowed an additional $150,000 and $200,000 under the Convertible Debenture Agreement, for total borrowings of $1,350,000 (the Pre-March Advances).  On March 27, 2009, the Company borrowed an additional $600,000 (the March Advance) under the Convertible Debenture agreement.



On June 29, 2009, the Company entered into a Loan Amending Agreement (Agreement 4) to revise the conversion price of the outstanding principal and accrued interest thereon into one share of common stock for every $0.20 for the Pre-March advances. Amendment 4 provides for conversion of the March advance into one share of common stock for every $0.10. Amendment 4 further revises the expiration date of the Lenders right to convert outstanding principal into shares of the Companys company stock conversion date to June 30, 2010.



In consideration of the Lender entering into Amendment 4, the Company granted the Lender warrants to purchase up to 875,000 shares of the Companys common stock at a purchase price of $0.10 per share for period of two years from the issuance date of the warrants. The Company determined debt discount in connection with the warrants granted to the Lender was immaterial under the Black-Scholes model.



Total outstanding under the convertible debenture as of October 31, 2009 is $1,950,000. The entire debt discount related to this convertible debenture has been amortized to interest expense. As of October 31, 2008 total outstanding under the convertible debenture agreement is $481,183, net of debt discount of $18,817.



F-19



---

Management performed an analysis of the convertible debt and the significant transaction dates above in connection with the stock options, and determined the convertible debt did not contain a beneficial conversion feature, as originally issued or amended, and that the fair value of the stock options granted are not material to the consolidated financial statements.



Subsequent to year-end on November 10, 2009 the Lender converted $1,600,000 into 19,250,000 restricted shares of the Companys common stock at a conversion price of $0.083117 per share in connection with the Share Exchange Agreement entered into with Technology Publishing, Inc. effective September 29, 2009.  The Conversion price was determined based on the average conversion price of the Amendment 4 revision price of every $0.20 for the Pre-March advances and $0.10 conversion price for the March advance, or $0.15, and 11,000,000 shares based on total debt of $1,600,000 converted.  Under the Share Exchange Agreement with TPI all shareholders, optionees and warrant and debt holders received 1.75 for 1 ratio for total shares of 19,500,000. After the conversion of debt $350,000 remains outstanding under the convertible debenture agreement.   See Note 16 - Subsequent Events.



In March 2006 the Company issued 10% Convertible Debentures to various lenders (the Con Deb Lenders) for total proceeds of $150,000. The debentures matured on June 15, 2007.  Under the terms of the Convertible Debenture agreements, the Con Deb Lenders converted the debentures into 250,000 shares of the Companys common stock at a conversion price equal to $0.60 per share. On March 19, 2008 the Board of Directors re-priced the shares to a conversion price equal to $0.40 per share and issued 218,746 additional shares to the various Con Deb Lenders.



8.

NOTE PAYABLE TO VENDOR



On March 10, 2009 the Company entered into a Memorandum of Workout Agreement and Secured Promissory Note Agreement (the Note Agreement) with a key supplier (the Supplier). Under the terms of the Note Agreement the Company converted $938,296 of accounts payable due to the Supplier into a short-term note payable.  The Secured Promissory Note Agreement (the Note Agreement) called for four consecutive monthly payments of $200,000 payable beginning March 31, 2009, with final payment of $138,296 payable on July 31, 2009.   The Note Agreement bears interest of 10% per annum, payable monthly in arrears. The interest increases to 12% per annum in event of default.   The Memorandum of Workout Agreement also established new credit line terms for inventory purchases for up to $500,000. The Note Agreement is secured by the Companys entire inventory acquired from the Supplier prior to and after the date of the Note Agreement. The Note Agreement is subordinated to the Convertible Debenture due 0793296 B.C. Ltd. Payments under the Note Agreement totaled $300,000 through September 30, 2009, with $638,296 outstanding under the Note Agreement. As of September 30, 2009, $357,000 was outstanding under the credit line.



On September 30, 2009, the Company entered into an Amended and Restated Workout Agreement and Amended and Restated Secured Promissory Note Agreement (the Amended Note Agreement) with the Supplier for total principal due of $935,296, which comprises of $638,296 outstanding under the original Note Agreement and $357,000 due under the credit line, less the first payment due of $60,000. Payments of $60,000 are due at the end of each month until the Amended Note Agreement matures on March 31, 2011, or the Company prepays the balance due, whichever occurs first.



In connection with the Amended Note Agreement the Company issued warrants to purchase up to 1,312,500 shares of the Companys common stock at exercise price of $0.20 per share. The warrants expire September 30, 2011 and provide for rights in event of change in ownership. The Company recorded the fair value of the warrants as determined by the Black-Scholes model of $39,375 as debt discount. As of October 31, 2009 total outstanding under the Note Agreement is $865,453, net of debt discount of $36,192.



9.

NOTE PAYABLE TO BANK



In March 2006, the Company entered into a term loan agreement with Business Development Bank of Canada (BDC) for total borrowings of $233,000 ($250,000 Canadian dollars). The loan matures in July 2012, calls for monthly principal payments of $2,600 ($2,780 Canadian dollars) and bears interest at the Banks Floating Base Rate plus 3% per annum (7.25% and 9% at October 31, 2009 and 2008, respectively). Two former officers of the Company, whom are currently serving on the board of directors, provided a personal guarantee of the outstanding loan amount. This personal guarantee was lowered to 25% of the total loan amount effective May 7, 2007. The term loan agreement contains various covenants including requirements for the Company to meet certain financial ratios, of which the Company is not in compliance with as of October 31, 2009.  Therefore, the entire balance outstanding of $84,972 as of October 31, 2009 is shown as current liability in the consolidated financial statements.



F-20



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Annual future minimum payments under the Companys long-term debt agreement with BDC as of October 31, 2009 (U.S. dollars) are as follows:



| |      |   |        |  | 
| | ---- | - | ------ |  | 
| | 2010 | $ | 30,721 |  | 
| | 2011 |   | 30,721 |  | 
| | 2012 |   | 23,530 |  | 
| |      | $ | 84,972 |  | 



10.

WORKING CAPITAL LOANS FROM RELATED PARTIES



As of October 31, 2009, $681,349, which is net of debt discount of $6,046, is outstanding under the working capital loans from related parties, for total proceeds in the amount of $687,395 which is comprised of the following:



-

On July 9, 2009, 0793296 B.C. Ltd. advanced $50,000 for short-term working capital needs. The loan bears interest at 12% per annum and is payable quarterly commencing October 1, 2009.  Interest increases to 15% per annum after October 31, 2009 until the loan is repaid.



-

In October, 2009 0793296 B.C. Ltd advanced $275,000 for short-term working capital needs under promissory note agreements, of which $200,000 is to be applied to a form of subscription agreement in connection with the Companys private placement offering subsequent to October 31, 2009.  The notes bear interest at 18% per annum and are payable quarterly commencing January 2010. Total interest payable in connection with the advances as of October 31, 2009 is $4,167.



-

On August 27, 2009, the Board of Directors approved the borrowing of funds through a factoring company (the Factoring Co.) for working capital needs. The proceeds are funded by 0840386 B.C. Ltd. and/or its nominees 0793296 B.C. Ltd, and 0885084 Alberta Inc., a company related to the Companys Chief Executive Officer, Chief Financial Officer, and other third party investors. The funds advanced under the terms of the factoring agreement bear a factoring fee of 2% per month.  The Company has received three advances for total of $362,395 under the agreement, which remain outstanding as of October 31, 2009. Total interest payable related to the borrowings as of October 31, 2009 is $20,157.



The Company issued warrants to the Factoring Co. to purchase up to 700,000 shares of the Companys common stock for eighteen months from the date of investment at $0.20 per share.  The Company recorded the fair value of the warrants under the Black-Scholes model as debt discount totaling $12,000.   Accretion of the debt discount totaled $5,955 as of October 31, 2009.



On January 6, 2010, the Company closed a non-brokered private placement of 1,754,524 units at $0.50 per unit pursuant to private placement subscription and debt conversion agreements settling $375,000 and $502,262, respectively, in connection with the advances and borrowings, and interest payable thereon.   See Note 14  Subsequent Events.



11.

SHAREHOLDERS EQUITY



The following table summarizes the total shares reserved and available as of October 31, 2009 in connection with the Bridge Credit Facility and Convertible Debenture Agreements as discussed in Note 7 of the Notes to Consolidated Financial Statements:

| |                                                                |           
| | -------------------------------------------------------------- | ----------
| |                                                                | Shares    
| |                                                                | Reserved  
| | Convertible debenture                                          | 19,250,000
| | Stock option issued to the Lender                              | 1,129,034 
| | Warrants issued to the Lender                                  | 875,000   
| | Total shares reserved in connection with convertible debenture | 21,254,034



F-21



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Shares Reserved for Future Issuance



The Company is required to reserve and keep available of its authorized, but unissued shares of common stock an amount sufficient to effect the conversion of the outstanding Convertible Debenture, plus shares granted and available for grant under the Companys stock option plans.   As of October 31, 2009, shares reserved for future issuance comprised of the following:



| |                                                                               |           
| | ----------------------------------------------------------------------------- | ----------
| |                                                                               | Shares    
| |                                                                               | Reserved  
| | Convertible debenture                                                         | 21,254,034
| | Outstanding stock options under the 2009 Stock Option Plan                    | 8,400,000 
| | Additional shares available under the 2009 Stock Option Plan                  | 6,600,000 
| | Warrants issued in connection with working capital loans from related parties | 700,000   
| | Warrants issued to Vendor in connection with Promissory Note Agreement        | 1,312,500 
| |                                                                               | 38,266,534



Stock Option Plans



On August 1, 2007, the Company adopted two stock option plans (collectively the 2007 Plans):



(i)

the 2007 Employee Stock Option Plan that provides for the granting of up to 7,000,000 shares of common stock to employees and consultants, of which 2,345,000 were granted and outstanding as of October 31, 2008;



(ii)

the 2007 Executive Stock Option Plan that provides for granting of up to 4,375,000 shares of common stock to eligible officers, directors, senior management and consultants of the Company.  Options granted in 2008 and outstanding as of October 31, 2008 under the 2007 Executive Stock Option Plan totaled 4,112,500.



No grants were made for the year ended October 31, 2007 under the 2007 Plans.  The 2007 Plans are administered by the Board of Directors.  At the discretion of the Board of Directors, the Company may from time to time grant options to consultants for services rendered, in lieu of cash payments.  The option price is set by the Board of Directors on the date of the grant. Options granted to employees may be incentive stock options or nonqualified options. Options granted to non-employee directors and consultants may only be nonqualified options. The Board of Directors determine the vesting periods.



On March 31, 2009, the Board of Directors of the Company cancelled all options previously granted under the 2007 Plans, and adopted the 2009 Employee Stock Option Plan providing for granting of up to 11,375,000 stock options to eligible officers, directors, senior management, employees and consultants of the Company. The new options were re-priced at an exercise price of $0.15, and retained their original issue dates and vesting schedules. The expiration date of the options was extended two years.  Under ASC 718, the Company measured incremental compensation cost for the replacement stock options as the excess of the fair value of the replacement stock options over the fair value of the cancelled stock option at the cancelation date.   The total compensation cost measured at the date of the cancellation and replacement was recognized as the portion of the grant-date fair value of the original award for which the requisite service is expected to be rendered as of March 31, 2009, plus the incremental cost resulting from the cancellation and replacement.



On September 28, 2009, pursuant to the Share Exchange Agreement entered into with TPI, the Company approved a Stock Option Plan  (the New 2009 Plan) authorizing the grant of up to 15,000,000 stock options, the exercise of which is subject to shareholder approval.  In conjunction with the reverse acquisition with TPI, the New 2009 Plan replaced the 2009 Plans that were approved on March 31, 2009. Under the terms of the New 2009 Plan, and pursuant to the terms to the Share Exchange Agreement, the Company granted 8,400,000 stock options to its employees, officers, directors, and consultants effective October 8, 2009. The Stock Option Plans provide for the granting of equity awards, including restricted stock and incentive and nonqualified stock options to purchase common stock, to employees, directors, officers and independent consultants of the Company. The options vest over periods as determined by the Board of Directors, generally three years.



F-22



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A summary of stock option activity for the year ended October 31, 2009 is as follows:

| |                                      |                          |   |                                                   |   |      | 
| | ------------------------------------ | ------------------------ | - | ------------------------------------------------- | - | ---- | 
| |                                      | Number
      Outstanding |   | Weighted
      Average
      Exercise
      Price
|
| | Options outstanding October 31, 2007 | -                        |   |                                                   |   | -    | 
| | Granted                              | 7,157,000                |   |                                                   | $ | 0.41 | 
| | Exercised                            | -                        |   |                                                   |   | -    | 
| | Cancelled                            | (525,000                 | ) |                                                   | $ | 0.40 | 
| | Options outstanding October 31, 2008 | 6,632,000                |   |                                                   | $ | 0.41 | 
| | Granted                              | 8,400,000                |   |                                                   | $ | 0.15 | 
| | Exercised                            | -                        |   |                                                   |   | -    | 
| | Cancelled                            | (6,632,000               | ) |                                                   | $ | 0.41 | 
| | Options outstanding October 31, 2009 | 8,400,000                |   |                                                   | $ | 0.15 | 
|
| | Options exercisable October 31, 2009 | 6,781,250                |   |                                                   | $ | 0.15 | 



On March 17, 2008, the Company entered into a Consulting and Management Services Agreement (the Consulting Agreement) with Level Ten Corporate Services, Inc. (Level Ten).  The Companys current Chief Financial Officer is also an officer of Level Ten.  The Consulting Agreement provided for options to purchase up to 750,000 shares of common stock at the exercise price of $0.31 per share to the Companys Chief Executive Officer and Chief Financial Officer.  On March 31, 2009, the options were re-priced in connection with the adoption of the 2009 Employee Stock Option Plan.    See Note 12  Related Parties and below.



Stock based compensation expense included in selling, general and administrative expense for the year ended October 31, 2009 and 2008 totaled $15,871 and $131,171, respectively.  The amount of unearned stock-based compensation currently estimated to be expensed from now through fiscal 2012 related to unvested share-based payment awards at October 31, 2009 is $10,385.



12.

RELATED PARTIES



Convertible Debenture



On June 19, 2007, the Company entered into a Convertible Loan Agreement with 0793296 B.C. Ltd (the Lender) for total borrowings of up to $3,000,000. See Note 7  Bridge Credit Facility and Convertible Debenture. The Companys current Chief Financial Officer is an officer of the Lender.



For the years ended October 31, 2009 and 2008, interest expense incurred in connection with the convertible debenture totaled $203,149 and $107,714, respectively. Interest paid to the Lender was $83,722 and $103,792 for the years ended October 31, 2009 and 2008, respectively.



Consulting Agreement



On March 17, 2008, the Company entered into a Consulting and Management Services Agreement (the Consulting Agreement) with Level Ten Corporate Services, Inc. (Level Ten).  The Companys current Chief Financial Officer is also an officer of Level Ten. The Consulting Agreement provides for the Companys Chief Executive Officer and Chief Financial Officer (the Consultants) to provide certain management consulting services to the Company. The Consulting Agreement calls for monthly retainer of $15,000, and is on a month to month basis. The Consulting Agreement also provides for options to purchase up to 750,000 shares of common stock at the exercise price of $0.40 per share to the Companys Chief Executive Officer and Chief Financial Officer.    See Note 11  Shareholders Equity.



On May 15, 2008, the Consultants were appointed to the Board of Directors of the Company. On July 22, 2008, the Consultants were also appointed as Officers of the Company.



F-23



---

On June 1, 2008, the Company amended the Consulting Agreement with the Consulting Company, raising the monthly retainer to $23,313 ($25,000 Canadian Dollars). Total payments for management services under the Consulting Agreements for the year ended October 31, 2009 and 2008 was $240,975 and $180,796, respectively.



Effective November 1, 2008 the Board of Directors approved the increase of the Chief Executive Officer and Chief Financial Officer consulting fees to USD$35,000 per month. The Consultants agreed to defer the increase until additional funding is raised by the Company.  As October 31, 2009, deferred consulting fees outstanding totaled $179,025, which is included in accrued expenses and other current liabilities in the Consolidated Balance Sheets.



Other Related Party Transactions



On January 3, 2006 the former Officers of the Company entered into an Asset Purchase Agreement whereby the Company assumed the lease for the Canadian facilities and acquired certain assets and customer contracts from its then-Chief Executive Officer and Vice President of Engineering.  The Asset Purchase Agreement was structured as a Section 85 tax deferred transaction under the Canadian Income Tax Act. Under the terms of the tax-deferred exchange transaction, the Company issued 1,000,000 shares of common stock in connection with the transaction and recorded loans due to the shareholders.



In November 2007, the Company entered into an agreement with its former Chief Executive Officer and Vice President of Engineering to repay shareholder loan balances outstanding totaling $162,994. In connection with the agreement, the Company transferred Canadian accounts receivables outstanding as of October 31, 2007 totaling $105,187, and, fixed assets and other prepaids totaling $19,840. The remaining amount of $37,967 was paid in cash to the shareholders in January 2008.



In November 2007, the Companys former Chief Executive Officer and Vice President of Engineering formed Puracom, an unrelated company. During the year ended October 31, 2009 and 2008, the Company retained the services of Puracom for research and development services for total fees of $10,396 and $42,805, respectively.



As of October 31, 2009, $32,192 is outstanding to a former shareholder and director of Technology Publishing Ltd. related to short-term advance to the Company.



Private Stock Purchase Transaction



On June 11, 2008, the parent company of the Lender (0793296 B.C. Ltd) entered into a private agreement with a former Officer of the Company to purchase his common stock ownership interest in the Company totaling 650,000 shares of the Companys common stock for total purchase price of $127,000 ($130,000 Canadian Dollars).



13.

INCOME TAXES



The Company recognizes deferred tax consequences of temporary differences in reporting items for financial statement and income tax purposes, as appropriate.  Realization of future tax benefits related to the deferred tax assets is dependent on many factors, including the Companys ability to generate future taxable income.



F-24



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Significant components of the Companys deferred tax assets and liabilities for federal and state income taxes as of October 31, 2009 and 2008 are as follows:

| |                                      |             |            |      |  |   |          |  
| | ------------------------------------ | ----------- | ---------- | ---- |  | - | -------- | -
| |                                      | October 31, |           
| |                                      | 2009        |            | 2008
| | Deferred tax assets:                 |             |            |      |  |   |          |  
| | Net operating loss                   | $           | 1,327,000  |      |  | $ | 259,000  |  
| | Stock-based compensation             |             | 63,000     |      |  |   | 56,000   |  
| | Provision for inventory obsolescence |             | 131,000    |      |  |   | 21,000   |  
| | Other                                |             | 83,000     |      |  |   | 58,000   |  
| |                                      |             | 1,604,000  |      |  |   | 394,000  |  
| | Deferred tax liabilities:            |             |            |      |  |   |          |  
| | Depreciation and amortization        |             | 489,000    |      |  |   | 65,000   |  
| | Total deferred tax asset             |             | 1,115,000  |      |  |   | 329,000  |  
| |                                      |             |            |      |  |   |          |  
| | Less valuation allowance             |             | (1,115,000 | )    |  |   | (329,000 | )
| | Net deferred tax asset               | $           | -          |      |  | $ | -        |  
|
| | Deferred:                            |             |            |      |  |   |          |  
| | Federal                              | $           | 870,000    |      |  | $ | 239,000  |  
| | State                                |             | 245,000    |      |  |   | 90,000   |  
| | Foreign                              |             | -          |      |  |   | -        |  
| | Total deferred tax asset             |             | 1,115,000  |      |  |   | 329,000  |  
| | Less valuation allowance             |             | (1,115,000 | )    |  |   | (329,000 | )
| | Net deferred tax asset               | $           | -          |      |  | $ | -        |  



Provision for income tax (benefit) expense as of October 31, 2009 and 2008 consists of the following:



| |                           |             |        |      |  |   |          |  
| | ------------------------- | ----------- | ------ | ---- |  | - | -------- | -
| |                           | October 31,
| |                           | 2009        |        | 2008
| | Federal                   | $           | -      |      |  | $ | (110,140 | )
| | State                     |             | 1,100  |      |  |   | -        |  
| | Foreign                   |             | (1,722 | )    |  |   | 14,871   |  
| | Total current tax benefit |             | (622   | )    |  |   | (95,269  | )
| | Deferred                  |             | -      |      |  |   | -        |  
| | Income tax benefit        | $           | (622   | )    |  | $ | (95,269  | )



The income tax provision (benefit) differs from the amount of income tax determined by applying the U.S. federal tax rate to pretax income as of October 31, 2009 and 2008 as follows:



| |                               |             |    |  |  |       |   
| | ----------------------------- | ----------- | -- |  |  | ----- | --
| |                               | October 31,
| |                               | 2009        |    |  |  | 2008  |   
| | Effective tax rate (benefit): |             |    |  |  |       |   
| | Federal                       | (34.0       | )% |  |  | (34.0 | )%
| | State                         | -           |    |  |  | -     |   
| | Change in valuation allowance | 23.3        |    |  |  | 31.9  |   
| | Other                         | 10.7        |    |  |  | (6.3  | ) 
| |                               | -           | %  |  |  | (8.4  | )%



F-25



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In assessing the realizability of deferred income tax assets, management follows the guidance contained within ASC 740, formerly SFAS No. 109, Accounting for Income Taxes, which requires that deferred income tax assets or liabilities be reduced by a valuation allowance, if based on weight of available evidence, considering all relevant positive and negative, objective and subjective evidence, it is more likely than not that some portion or all of the deferred income tax assets will not be realized.  The Companys historical operating losses make it very difficult to meet the more likely than not standard required to conclude that its deferred tax assets will be fully utilized.  Therefore, management has recorded a valuation allowance equal to the total deferred income tax assets of $1,115,000 and $329,000 as of October 31, 2009 and 2008, respectively.



The Company adopted the provisions of FIN 48 effective for the first quarter of fiscal year 2008.   The Company does not expect the unrecognized tax benefits to significantly increase or decrease within the next twelve months.  The total amount of unrecognized tax benefits at October 31, 2009 and 2008, respectively, is zero.



As of October 31, 2009, the Company had federal and California net operating loss carryforwards of approximately $3,600,000 and $3,400,000, respectively, which will begin to expire in fiscal 2028, respectively. As of October 31, 2009, the Company had $110,000 income tax receivable related to refunds due from the Internal Revenue Service for income taxes overpaid.



The Tax Reform Act of 1986 contains provisions that limit the federal net operating loss carryforwards that may be used in any given year in the event of specified occurrences, including significant ownership changes.  As a result of these provisions, utilization of net operating losses would be limited in the event of any future significant ownership change.  Such a limitation could result in the expiration of the net operating loss carryforwards before utilization.  The Company had such an ownership change related to its parent Nexaira Wireless, a Nevada corporation in connection with the Share Exchange Agreement. The impact of any limitation of net operating loss carryforwards was determined to be immaterial.



14.

COMMITMENTS AND CONTINGENCIES



Operating Leases



The Company leases its facilities totaling approximately 10,000 square feet, under non-cancelable operating leases, with terms ranging from less than one year to January 31, 2010. Current minimum monthly payments total $12,130 under the lease agreements, with provision for annual increases.



On June 27, 2008, the Company entered into a into a 12-month lease for additional corporate housing calling for monthly payments of $2,950. The lease converted to month-to-month effective July 1, 2009 at the rate of $3,050 per month.   On August 1, 2007, the Company entered into a 12-month residential lease for corporate housing. The agreement calls for monthly payments of $2,700.  The Company terminated this lease effective December 31, 2008.



Annual future minimum payments under the Companys operating lease agreements as of October 31, 2009 are as follows:



| |      |   |        | 
| | ---- | - | ------ | 
| | 2010 | $ | 36,390 | 



Total rent expense for the years ended October 31, 2009 and 2008 under the Companys operating lease agreements was $201,189 and $207,057, respectively.



Contingencies



From time to time, the Company becomes involved in various investigations, claims and legal proceedings that arise in the ordinary course of business. These matters may relate to product liability, employment, intellectual property, tax, regulation, contract or other matters. The resolution of these matters as they arise will be subject to various uncertainties and, even if such claims are without merit, could result in the expenditure of financial and managerial resources. While unfavorable outcomes are possible, based on available information, the Company generally does not believe the resolution of these matters will result in a material adverse effect on the business, consolidated financial condition, or results of operations.



F-26



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15.

401(k) PLAN



Effective January 1, 2008, the Company established a 401(k) defined contribution retirement savings plan under which eligible U.S. employees may choose to defer a portion of their eligible compensation on a pre-tax basis, subject to certain IRS limitations. The 401(k) Plan qualifies under Section 401(k) of the United States Internal Revenue Code of 1986, as amended.  The Company may at its sole discretion match employee contributions.   The Company did not make matching contributions in the year ended October 31, 2009.



16.

SUBSEQUENT EVENTS



The Company has evaluated subsequent events, as defined by ASC 855, formerly SFAS No. 165, Subsequent Events, through the date that the financial statements were issued on January 29, 2010.



Conversion of Debt



TPI and 0793296 B.C. Ltd. (the Assignor) entered into an assumption agreement dated September 28, 2009, pursuant to which TPI assumed the indebtedness of the Assignor from the Company. On November 10, 2009 the Assignor assigned $1,600,000 of the indebtedness (the Assigned Indebtedness) to 15 investors (the Assignees).  Effective November 10, 2009, as disclosed in our Form 10-K for the fiscal year ended August 31, 2009 as filed with the Securities and Exchange Commission on November 18, 2009,  the Assignees and the Assignor converted the entire $1,600,000 of debt into 19,250,000 restricted shares pursuant to certain debt conversion subscription agreements. The Conversion price was determined based on the average conversion price of the Amendment 4 revision price of every $0.20 for the Pre-March advances and $0.10 conversion price for the March advance, or $0.15, and 11,000,000 shares based on total debt of $1,600,000 converted.    Under the Share Exchange Agreement with TPI all shareholders, optionees and warrant and debt holders received 1.75 for 1 ratio for total shares of 19,250,000.



After the conversion of debt $350,000 remains outstanding under the convertible debenture agreement.



Non-brokered Private Placement Subscription and Debt Conversion Agreements



Effective January 6, 2010, as disclosed in our Current Report on Form 8-K as filed with the Securities and Exchange Commission on January 10, 2010, the Company closed a non-brokered private placement of 1,754,524 units at US$0.50 per unit for cash proceeds of $375,000 and in settlement of debt totaling $502,262.  Each unit is comprised of one common share and one common share purchase warrant. Each non-transferable warrant entitles the holder to purchase one additional share of common stock of the company at a price of $1.00 per share until January 6, 2012. The units were issued pursuant to private placement subscription agreements and debt conversion agreements, as applicable, each dated January 6, 2010. The Company issued the units to 10 non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933, as amended (the Act).    None of the securities offered or sold under the private placement have been or will be registered under the Act and none of them may be offered or sold in the United States absent registration or an applicable exemption from the registrations requirements of the Act. Each of the securities issued will be a restricted security under the Act and will be subject to a hold period under applicable U.S. and Canadian securities laws.



On January 18, 2010 the Company received $100,000 in connection with a non-brokered private placement that has not yet closed, however prior to closing, the Company is entitled to treat the funds as an interest free loan and use the proceeds.  In addition, on January 18, 2010, the Company received a short-term working capital loan totaling $100,000 at 12% interest per annum, payable on demand to a third party.



F-27



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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.



On January 4, 2010, as disclosed in our current report on Form 8-K as filed with the Securities and Exchange Commission on January 4, 2010, Manning Elliott LLP, Chartered Accountants (Manning Elliott), was dismissed as our principal independent accountant, and on January 4, 2010, we engaged, BDO Seidman, LLP as our principal independent accountant to audit our companys consolidated financial statements for our companys new fiscal year end of October 31, as previously disclosed. The decision to appoint BDO Seidman, LLP was approved by our board of directors and audit committee.

In connection with the change of accountants from Manning Elliott to BDO Seidman, there were no disagreements of the type described in Item 304(a)(1)(iv) of Regulation S-K.



ITEM 9A(T). CONTROLS AND PROCEDURES.



Disclosure Controls and Procedures



Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is accumulated and communicated to management, including our president, to allow timely decisions regarding required disclosure.



As required by paragraph (b) of Rules 13a-15 or 15d-15 under the Securities Exchange Act of 1934, our management, with the participation of our president (our principal executive officer) and our chief financial officer (our principal financial officer and principal accounting officer) evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this annual report, being October 31, 2009.  Our president and our chief financial officer evaluated our companys disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) as of October 31, 2009.



Based on this evaluation, these officers concluded that, as of October 31, 2009, these disclosure controls and procedures were not effective to ensure that the information required to be disclosed by our company in reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities Exchange Commission and include controls and procedures designed to ensure that such information is accumulated and communicated to our companys management, including our president and chief financial officer, to allow timely decisions regarding required disclosure.



The conclusion that our disclosure controls and procedures were not effective was due to the presence of material weaknesses in internal control over financial reporting as identified below under the heading Managements Report on Internal Control Over Financial Reporting. Management anticipates that such disclosure controls and procedures will not be effective until the material weaknesses are remediated. Our company intends to remediate the material weaknesses as set out below under the heading, Management s Remediation Initiatives.



Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.



24



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Managements Report on Internal Control over Financial Reporting



Our management is responsible for establishing and maintaining adequate internal control over financial reporting.



The term internal control over financial reporting is defined as a process designed by, or under the supervision of, the registrants principal executive officer, or persons performing similar functions, and effected by the registrants board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:



| |     |                                                                                                                                                                                                                                                                                                                                                  
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the registrant;                                                                                                                                                                                 
| | (2) | Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the registrant are being made only in accordance with authorizations of management and directors of the registrant; and
| | (3) | Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, or use or disposition of the registrant's assets that could have a material effect on the financial statements.                                                                                                                               



Under the supervision of our new president and chief financial officer, being our principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of October 31, 2009 using the criteria established in Internal ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). This evaluation included review of the documentation of controls, evaluation of the design effectiveness of controls, testing of the operating effectiveness of controls and a conclusion on this evaluation. Based on this evaluation, our management concluded our internal control over financial reporting was not effective as at October 31, 2009.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our companys annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of our internal control over financial reporting as of October 31, 2009, we determined that there were control deficiencies that constituted material weaknesses which are indicative of many small companies with small staff, such as:

| |     |                                                                                                                                                                                                                                                                                                                                                                                                
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | certain entity level controls establishing a tone at the top were considered material weaknesses. Prior to October 26, 2009 the company did not have an audit committee and there was an inadequate amount of review by management of the financial statement reporting process. A code of ethics had not been established and policies regarding fraud and whistleblowers were not in place;
| | (2) | inadequate segregation of duties and effective risk assessment;                                                                                                                                                                                                                                                                                                                                
| | (3) | insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines; and                                                                                                                                                                                                                   
| | (4) | inadequate security and restricted access to computers, including insufficient disaster recovery plans.                                                                                                                                                                                                                                                                                        



These control deficiencies resulted in a reasonable possibility that a material misstatement of the annual or interim financial statements could not have been prevented or detected on a timely basis.  As a result of the material weaknesses described above, we concluded that we did not maintain effective internal control over financial reporting as of October  31, 2009 based on criteria established in Internal ControlIntegrated Frameworkissued by COSO. Our new management, board of directors and audit committee are currently evaluating remediation plans for the above deficiencies.   During the period covered by this annual report on Form 10-K, we have not been able to remediate the weaknesses described above.   However, we plan to take steps to enhance and improve the design of our internal control over financial reporting.   Our proposed plans are set out below under the heading, Managements Remediation Initiatives.



25



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Changes in Internal Controls



As discussed above, we conducted an evaluation of the effectiveness of our internal control over financial reporting during our most recent fiscal quarter ending October 31, 2009 using the criteria established in Internal ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).   Based on our evaluation using the criteria established, our management concluded that our internal controls over financial reporting were not effective as of October 31, 2009.



Managements Remediation Initiatives



Although our company has been unable to meet the standards under COSO because of the limited funds that have been available to a company of our size and stage of development, we are committed to improving our financial organization.



On October 26, 2009, we established an audit committee consisting of four directors, two of whom are independent directors, who will oversee the establishment and monitoring of required disclosure controls and procedures and internal control over financial reporting. The audit committee is directed to: review the scope, cost and results of the independent audit of our books and records; review the results of the annual audit with management; review the adequacy of our accounting, financial and operating controls; recommend annually to the board of directors the selection of the independent registered accountants; consider proposals made by the independent registered chartered accountants for consulting work; and report to the board of directors, when so requested, on any accounting or financial matters. We will undertake to: (1) create a position to segregate duties consistent with control objectives, (2) increase our personnel resources and technical accounting expertise within the accounting function and (3) prepare and implement sufficient written policies and checklists which will set forth procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements.



26



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We will continue to monitor and evaluate the effectiveness of our disclosure controls and procedures and our internal control over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.  However, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within our company have been detected.  These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.  Projections of any evaluation of controls effectiveness to future periods are subject to risks.



Attestation Requirement



This annual report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting.  Our managements report on internal controls over financial reporting was not subject to attestation by our independent registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only a managements report in this annual report.



ITEM 9B. OTHER INFORMATION.



None.



PART III



ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.



Directors and Executive Officers, Promoters and Control Persons

In connection with the closing of the share exchange agreement with Nexaira, Slawek Kajko resigned as our president, secretary, treasurer and director, and Edward Dere resigned as our vice-president and director, effective September 29, 2009.  As of November 10, 2009, our directors and officers are as follows:



|                  |                                                 |     |                                
|----------------- | ----------------------------------------------- | --- | -------------------------------
|Name              | Position Held with the Company                  | Age | Date First Elected or Appointed
|                  |                                                 |     |                                
|Mark Sampson      | President, Chief Executive Officer and Director | 53  | September 29, 2009             
|Ralph Proceviat   | Chief Financial Officer and Director            | 59  | September 29, 2009             
|Brad Weinert      | Director                                        | 50  | September 29, 2009             
|James Grey        | Director                                        | 62  | September 29, 2009             
|Garry Bourns      | Director                                        | 49  | September 29, 2009             
|Bernard Parkinson | Director                                        | 56  | September 29, 2009             



Term of Office



All directors of our company hold office until the next annual meeting of the stockholders or until their successors have been elected and qualified. The officers of our company are appointed by our board of directors and hold office until their death, resignation or removal from office.



27



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Business Experience



The following is a brief account of the education and business experience of each director and executive officer during at least the past five years, indicating each persons business experience, principal occupation during the period, and the name and principal business of the organization by which they were employed.



Officers and Directors



Mark Sampson, President and CEO, Director



Mr. Sampson has over 20 years of executive management experience in the telecommunications and information technology sectors with data and Internet companies such as AT&T Canada and Telus Advanced Communications and has served as president and chief executive officer of both public and private companies. He was appointed president of Nexaira in May of 2008 and chief executive officer in August 2008. From August 2007 to date, he has been a partner at Level 10 Capital Corp. From December 2005 to January 2007 he served as president and chief executive officer of GEM Solutions Inc. and from December 2003 to December 2005 he was president and chief executive officer of IP Applications Ltd.



Ralph Proceviat, Chief Financial Officer, Director



Mr. Proceviat is a Chartered Accountant with more than 25 years of business experience in diverse industries including high technology, telecommunications, real estate development and brokerage and manufacturing. He has held various executive positions with public and private organizations operating throughout the United States and Canada. He was appointed chief financial officer of Nexaira Inc. in May 2008 and is a member of its board of directors. He has been the president of Level 10 Capital Corp. since May 2007. From 2001 to 2005, he was the chairman and president of ThrillTime Entertainment International, Inc., a publicly traded company.



Brad Weinert, Director



Mr. Weinert has more than 27 years of experience in the high-technology industry in including wireless data networking, computer software, local and wide area networking, telecommunications, online commerce and computer hardware and peripherals in both public and private companies. He most recently served as President for Novatel Wireless from August 2007 to December 2008 and as acting CEO from November 2006 to August 2007, Chief Operating Officer (November 2006 to August 2007); Sr. Vice President of Business Development (March 2003 to April 2006).



James Grey, Director



Mr. Grey is a veteran IT and Telecom executive with over 30 years of business development experience for companies including Radiant Communications (RCN.V), BC Telecom, Telus and IBM. As CEO of Radiant, Jim led the company from a start up to one of Profit Magazines fastest growing companies reaching 27th position in 2004. Mr. Grey left Radiant in October 2005 as President and CEO after 51/2 years.



Garry Bourns, Director



Mr. Bourns brings over 19 years of experience in wireless and GPS technology with both public and private companies, including extensive success initiating and growing new wireless data businesses in emerging markets. Prior to founding Nexaira in 2004, Mr. Bourns led business development for Wavecom Inc. in San Diego, where he was responsible for North American carrier relations including significant distribution deals with Sprint, Verizon, AT&T, Rogers and Canada Bell.



Bernard Parkinson, Director



Mr. Parkinson brings 20 years of experience in corporate general management and operations. Prior to founding Nexaira in 2004 he held the position of Director of Business Development of Bell West Inc. (a wholly owned subsidiary of BCE Inc.) from 2000 to 2005. He currently holds the position of president and CEO of Platinum Communications a TSX Venture Exchange company.



28



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Sherrill Aspin, Secretary



Ms. Aspin has more than 30 years of business experience spanning a number of industries in the private and public sectors. Ms. Aspin completed the Canadian Securities Course through the Canadian Securities Institute in 1981 and in 1995 she completed the Corporate Governance of VSE Issuers Course through Simon Fraser University, B.C. She was appointed Corporate Secretary of Nexaira Inc. in February 2009 and has been responsible for all corporate governance and administrative functions for the portfolio investments under the Level 10 Capital group of companies since March 2007. From April 1994 to January 2005 she was the corporate secretary and a director of ThrillTime Entertainment International, Inc., a publicly traded company.



Directorships



Except as disclosed herein none of our directors are either board members or officers of any publicly traded companies worldwide.



|                  |                                     |                      |                     
|----------------- | ----------------------------------- | -------------------- | --------------------
|Name of Director  | Name of Reporting Issuer            | Exchange             | Term                
|Bernard Parkinson | Platinum Communications Corporation | TSX Venture Exchange | May 2009  to Present



Family Relationships



There are no family relationships among our directors and officers.



Significant Employees of Nexaira, Inc.



Carl Silva, Chief Scientist and Vice President of Technology



Mr. Silva has over 24 years of experience in the telecommunications and high tech industries, in business development, software engineering and systems engineering. From July 2006 to May 2008, Mr. Silva was president and chief executive officer of Cognigen Business Systems, Inc., a joint venture of ABP and Cognigen Networks, Inc. (NASDAQ: CNGW), formed for the purpose of providing broadband services to the quick service retail industry. From May 2003 to July 2006, Mr. Silva was a founder and senior managing partner of Anza Borrego Partners, a management consulting firm. From July 1998 to May 2003, he was senior vice-president of SAICs Converged Network Professional services organization and from September 1994 to June 1998, he was with Telcordia Technologies. Mr. Silva also has been a member of the board of directors of Onstream Media (NASDAQ: ONMS) since July 2006.



Rusty Wright, Vice President of Marketing and Products



Mr. Wright has been in the data communications industry for over 25 years, serving in a wide degree of functions including engineering, operations, marketing, sales and consulting. Mr. Wrights consulting firm was hired by Nexaira in February 2008 and he accepted the position of vice president of marketing and product with Nexaira in June 2008. From January 2006 until February 2007, he was senior vice-president at GEM Solutions. He held senior management positions at Netifice from June 2003 to August 2005, as well as at Cerberus, Yipes and most notably, as vice president of data sales for AT&T Canada.



JR Yakel, Vice President of Sales



Mr. Yakel has more than 15 years of experience in wireless and networking industries, including senior sales positions at Novatel and Sprint. He was appointed vice-president of sales of Nexaira in August 2007. From July 2006 to August 2007, he served as major account manager into Sprint for Novatel Wireless and from 2000 to 2006, he held vendor management positions with Sprint.



Tracy Bolton, CPA, Vice President Finance and Controller



Ms. Bolton is a Certified Public Accountant with an extensive background in accounting, auditing, Sarbanes-Oxley compliance. She has over 22 years experience, including nine years experience in public accounting, at both a "Big 4" and local firms serving in audit, litigation and accounting service capacities most recently in controllership capacities for both publicly and privately held companies.



29



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Involvement in Certain Legal Proceedings



Our directors, executive officers, promoters, and control persons have not been involved in any of the following events during the past five years:

| |    |                                                                                                                                                                                                                                                                                                        
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 1. | any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;                                                                                                  
| | 2. | any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);                                                                                                                                                     
| | 3. | being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or
| | 4. | being found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.             



Audit Committee



Our board of directors established an audit committee on October 26, 2009.  Following this date, Messrs. Grey, Weinert, Sampson and Proceviat have acted as the members of the audit committee. Messrs. Grey and Weinert are independent as defined by Nasdaq Marketplace Rule 4200(a)(15) or National Instrument 52-110 as adopted by the British Columbia Securities Commission. The audit committee is directed to: review the scope, cost and results of the independent audit of our books and records; review the results of the annual audit with management; review the adequacy of our accounting, financial and operating controls; recommend annually to the board of directors the selection of the independent registered accountants; consider proposals made by the independent registered chartered accountants for consulting work; and report to the board of directors, when so requested, on any accounting or financial matters. The board of directors adopted its charter for the audit committee on October 26, 2009.



Audit Committee Financial Expert



Our board of directors has determined that our company has two audit committee financial experts serving on the audit committee.



James Grey



Mr. Grey has a Bachelor of Commerce degree and has served on the Board of Directors for a number of public and private companies, often as a member or chair of the finance committee.



Ralph Proceviat



Mr. Proceviat is a Chartered Accountant with more than 25 years of business experience in diverse industries including high technology, telecommunications, real estate development and brokerage and manufacturing.



Nomination Procedures For Appointment of Directors



As of October 31, 2009, we had not effected any material changes to the procedures by which our shareholders may recommend nominees to our board of directors. Our board of directors does not have a policy with regards to the consideration of any director candidates recommended by our shareholders. Our board of directors has determined that it is in the best position to evaluate our companys requirements as well as the qualifications of each candidate when the board considers a nominee for a position on our board of directors. If shareholders wish to recommend candidates directly to our board, they may do so by sending communications to the president of our company at the address on the cover of this annual report.



Code of Ethics



On October 30, 2009, our companys board of directors adopted a Code of Ethics and Business Conduct that applies to, among other persons, our companys president and chief executive officer (being our principal executive officer) and our companys chief financial officer (being our principal financial officer and principal accounting officer), as well as persons performing similar functions. As adopted, our Code of Ethics and Business Conduct sets forth written standards that are designed to deter wrongdoing and to promote:



30



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1.

honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

2.

full, fair, accurate, timely, and understandable disclosure in reports and documents that we file with, or submit to, the Securities and Exchange Commission and in other public communications made by us;

3.

compliance with applicable governmental laws, rules and regulations;

4.

the prompt internal reporting of violations of the Code of Ethics and Business Conduct to an appropriate person or persons identified in the Code of Ethics and Business Conduct; and

5.

accountability for adherence to the Code of Ethics and Business Conduct.



Our Code of Ethics and Business Conduct requires, among other things, that all of our companys personnel shall be accorded full access to our president, secretary and treasurer and our chief financial officer with respect to any matter which may arise relating to the Code of Ethics and Business Conduct. Further, all of our companys personnel are to be accorded full access to our companys board of directors if any such matter involves an alleged breach of the Code of Ethics and Business Conduct by our president, secretary and treasurer or our chief financial officer.



In addition, our Code of Ethics and Business Conduct emphasizes that all employees, and particularly managers and/or supervisors, have a responsibility for maintaining financial integrity within our company, consistent with generally accepted accounting principles, and federal, provincial and state securities laws. Any employee who becomes aware of any incidents involving financial or accounting manipulation or other irregularities, whether by witnessing the incident or being told of it, must report it to his or her immediate supervisor or to our companys president, secretary and treasurer. If the incident involves an alleged breach of the Code of Ethics and Business Conduct by the president, secretary and treasurer, the incident must be reported to any member of our board of directors. Any failure to report such inappropriate or irregular conduct of others is to be treated as a severe disciplinary matter. It is against our company policy to retaliate against any individual who reports in good faith the violation or potential violation of our companys Code of Ethics and Business Conduct.



Section 16(a) Beneficial Ownership Reporting Compliance



Section 16(a) of the Securities Exchange Act of 1934 requires our executive officers and directors, and persons who own more than 10% of a registered class of our equity securities to file with the Securities and Exchange Commission initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of our common stock and other equity securities, on Forms 3, 4 and 5 respectively.  Executive officers, directors and greater than 10% shareholders are required by the SEC regulations to furnish us with copies of all Section 16(a) reports that they file.



Based solely on our review of the copies of such forms received by us, or written representations from certain reporting persons, we believe that all Section 16(a) filing requirements applicable to our officers, directors and greater than ten percent beneficial owners were complied with, with the exception of the following:



|                  |                        |                                                       |                                
|----------------- | ---------------------- | ----------------------------------------------------- | -------------------------------
|Name/Position     | Number of Late Reports | Number of Transactions Not Reported on a Timely Basis | Failure to File Requested Forms
|Mark Sampson      | 3                      | 6                                                     | None                           
|Ralph Proceviat   | 2                      | 8                                                     | None                           
|Garry Bourns      | 1                      | 2                                                     | None                           
|Brad Weinert      | 1                      | 1                                                     | None                           
|Bernard Parkinson | 1                      | 1                                                     | None                           
|James Grey        | 1                      | 1                                                     | None                           
|Sherrill Aspin    | 2                      | 3                                                     | None                           
|Carl Silva        | 1                      | 1                                                     | None                           
|JR Yakel          | 1                      | 1                                                     | None                           
|Rusty Wright      | 1                      | 1                                                     | None                           



31



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ITEM 11. EXECUTIVE COMPENSATION.



The following table shows the compensation received by our executive officers for the periods indicated:



Summary Compensation Table

|                                                                 |                  |                            |                  |                                |                                 |                                                                                 |                                                                             |                                                  |                      
|---------------------------------------------------------------- | ---------------- | -------------------------- | ---------------- | ------------------------------ | ------------------------------- | ------------------------------------------------------------------------------- | --------------------------------------------------------------------------- | ------------------------------------------------ | ---------------------
|Name 
      and Principal 
      Position                        | Year             | Salary 
      ($)          | Bonus 
      ($) | Stock 
      Awards 
      ($) | Option 
      Awards 
      ($) | Non- 
      Equity 
      Incentive 
      Plan 
      Compen-sation 
      ($) | Nonqualified 
      Deferred 
      Compensation 
      Earnings 
      ($) | All 
      Other 
      Compen-sation 
      ($) | Total 
      ($)     
|Slawek Kajko 
      President, Secretary 
      and Treasurer(1) | 2009 
      2008 | Nil 
      Nil             | Nil 
      Nil   | Nil 
      Nil                 | Nil 
      Nil                  | Nil 
      Nil                                                                  | Nil 
      Nil                                                              | Nil 
      Nil                                   | Nil 
      Nil       
|Edward Dere 
      Vice President(2)                             | 2009 
      2008 | Nil 
      Nil             | Nil 
      Nil   | Nil 
      Nil                 | Nil 
      Nil                  | Nil 
      Nil                                                                  | Nil 
      Nil                                                              | Nil 
      Nil                                   | Nil 
      Nil       
|Nexaira Executives and Directors (3)                            
|Mark Sampson, President, CEO and Director                        | 2009
      2008  | 240,000(4)
      90,398(4) | Nil 
      Nil   | Nil 
      Nil                 | 3,965(7)26,500(7)               | Nil 
      Nil                                                                  | Nil 
      Nil                                                              | Nil 
      Nil                                   | 243,965
      116,898
|Ralph Proceviat CFO, Treasurer and Director                      | 2009
      2008  | 180,000(5)
      90,398(5) | Nil 
      Nil   | Nil 
      Nil                 | 2,643(7) 17,667(7)              | Nil 
      Nil                                                                  | Nil 
      Nil                                                              | Nil 
      Nil                                   | 182,643
      108,065
|JR Yakel
      Vice President of Sales                           | 2009
      2008  | 147,692
      88,154       | Nil 
      Nil   | Nil 
      Nil                 | 1,322(7)
      17,083(7)        | Nil 
      Nil                                                                  | Nil 
      Nil                                                              | 40,004(6)
      116,708(6)                       | 189,018
      221,945



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Slawek Kajko resigned as director and from all officer positions held effective as of September 29, 2009.                                                                                                                                                                                                                                                                                                                                                  
|(2) | Edward Dere resigned as director and vice-president effective as of September 29, 2009.                                                                                                                                                                                                                                                                                                                                                                    
|(3) | The information provided for Nexaira officers and directors relates to the 12 months of its fiscal year ending October 31, 2009 and the twelve month period ended October 31, 2008.                                                                                                                                                                                                                                                                        
|(4) | This compensation was paid by way of a monthly consulting fee paid to Level Ten Corporate Services, Inc., a Canadian company, pursuant to a Consulting Management Services Agreement with NexAira Inc. In turn Level Ten Corporate Services, Inc paid fees to a Canadian company owned or controlled by Mark Sampson. Consulting fees for the year ended October 31, 2008 commenced February, 2008. Of the $240,000 fees for 2009, $102,300 remains unpaid.
|(5) | This compensation was paid by way of a monthly consulting fee paid to Level Ten Corporate Services, Inc, a Canadian company owned or controlled by Ralph Proceviat, pursuant to a Consulting Management Services Agreement with NexAira Inc. Consulting fees for the year ended October 31, 2008 commenced February, 2008.  Of the $180,000 fees for 2009, $76,725 remains unpaid.                                                                         
|(6) | Fees paid to JR Yakel from November 1, 2008 to January 31, 2008 were paid by way of a monthly consulting fee paid to a company owned or controlled by JR Yakel. Effective February 1, 2008, Mr. Yakels status changed to that of an employee. Other compensation consists of commissions.                                                                                                                                                                 
|(7) | The value of the stock-based compensation is determined by using the Black-Scholes model, with the following assumptions: a weighted average expected life of 3 years, expected volatility of 50% to 60%, risk free interest rates of 1.31% to 2.89% and expected dividend yield of 0%.                                                                                                                                                                    



32



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Outstanding Equity Awards at Fiscal Year-End



|                                                                 |                                                                                                     |                                                                                                      |                                                                                                                                                                  |                                             |                                               |                                                                                              |                                                                                                            |                                                                                                                                                                      |                                                                                                                                                                                              
|---------------------------------------------------------------- | --------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------- | --------------------------------------------- | -------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END                    
|                                                                 | OPTION AWARDS                                                                                       | STOCK AWARDS                                                                                        
|Name                                                             | Number of Securities
      Underlying 
      Unexercised
      Options
      (#) 
      Exercisable | Number of Securities
      Underlying 
      Unexercised
      Options
      (#) 
      Unxercisable | 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 of 
      Units of 
      Stock that
      Have not Vested 
      ($) | Equity Incentive 
      Plan Awards: 
      Number of 
      Unearned Shares, 
      Units or 
      Other 
      Rights that 
      have not
      Vested
      (#) | Equity Incentive 
      Plan Awards: 
      Market or 
      Payout Value 
      of Unearned 
      Shares, Units 
      or other 
      Rights that 
      have not 
      Vested 
      ($)
|                                                                 |                                                                                                     |                                                                                                      |                                                                                                                                                                  |                                             |                                               |                                                                                              |                                                                                                            |                                                                                                                                                                      |                                                                                                                                                                                              
|Slawek Kajko 
      President, Secretary 
      and Treasurer(1) | Nil                                                                                                 | Nil                                                                                                  | Nil                                                                                                                                                              | Nil                                         | Nil                                           | Nil                                                                                          | Nil                                                                                                        | Nil                                                                                                                                                                  | Nil                                                                                                                                                                                          
|Edward Dere 
      Vice President(2)                             | Nil                                                                                                 | Nil                                                                                                  | Nil                                                                                                                                                              | Nil                                         | Nil                                           | Nil                                                                                          | Nil                                                                                                        | Nil                                                                                                                                                                  | Nil                                                                                                                                                                                          
|Mark Sampson, President, CEO and Director                        | 1,312,500                                                                                           | Nil                                                                                                  | Nil                                                                                                                                                              | $0.15                                       | July 17, 2013                                 | Nil                                                                                          | Nil                                                                                                        | Nil                                                                                                                                                                  | Nil                                                                                                                                                                                          
|Ralph Proceviat CFO, Treasurer and Director                      | 875,000                                                                                             | Nil                                                                                                  | Nil                                                                                                                                                              | $0.15                                       | July 17, 2013                                 | Nil                                                                                          | Nil                                                                                                        | Nil                                                                                                                                                                  | Nil                                                                                                                                                                                          
|JR Yakel
      Vice President of Sales                           | 525,000                                                                                             | Nil                                                                                                  | Nil                                                                                                                                                              | $0.15                                       | July 17, 2013                                 | Nil                                                                                          | Nil                                                                                                        | Nil                                                                                                                                                                  | Nil                                                                                                                                                                                          



On September 28, 2009, our companys board of directors adopted our 2009 Stock Option Plan by unanimous consent resolution, with effectiveness of the Plan conditional upon stockholder approval. Under the Plan, eligible employees, consultants, and such other persons, other than directors, subject to tax in the United States who are not eligible employees, may receive awards of non-qualified stock options.  Also under the Plan, individuals who, at the time of the option grant, are employees of our company or any related company, as defined in the Plan, who are subject to tax in the United States, may receive incentive stock options, and non-United States residents may receive awards of options.  The purpose of the Plan is to retain the services of valued key employees, directors, officers and consultants and to encourage such persons with an increased incentive to make contributions to our company.  The aggregate number of shares of our companys common stock with respect to which stock options may be granted under the Plan shall not exceed 15,000,000 shares. In general, if awards under the Plan are for any reason cancelled, or expire or terminate unexercised, the shares covered by such options will again be available for the grant of awards under the Plan.  As of October 31, 2009 the following options have been granted under the Stock Option Plan, the exercise of which are conditional upon stockholder approval of the Plan:



33



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|                                                              |                             
|------------------------------------------------------------- | ----------------------------
|Name/Position                                                 | Number of Options Granted(1)
|                                                              |                             
|Mark Sampson, President, CEO and Director                     | 1,312,500                   
|Ralph Proceviat, Chief Financial Officer and Director         | 875,000                     
|0793296 BC Ltd.                                               | 1,129,034(2)                
|Sherrill Aspin, Corporate Secretary                           | 175,000                     
|JR Yakel, Vice President of Sales                             | 525,000                     
|Rusty Wright, Vice President of Marketing and Products        | 875,000                     
|Carl Silva, Chief Scientist and Vice President of  Technology | 700,000                     
|Executive Group                                               | 5,591,534                   
|James Grey                                                    | 437,500                     
|Brad Weinert                                                  | 437,500                     
|Non-Executive Director Group                                  | 875,000                     
|Non-Executive Officer Employee Group                          | 3,062,500                   

|(1) | All of the options listed in the table above expire on July 17, 2013 and have an exercise price of $0.15 per share, with the exception of the options described in Note (2) below.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | 0793296 BC Ltd. is a company owned or controlled by Ralph Proceviat.  These options have an exercise price of $0.20 per share and expire on November 7, 2010.                     

.



Compensation of Directors



We have approved a policy of compensating our non executive directors for their service in their capacity as directors at a nominal $1,000 per month plus out-of-pocket expenses. During the fiscal year ended October 31, 2009, $43,000 was accrued of which $1,000 was paid to one director. We may reimburse our directors for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our board of directors. Our board of directors may award special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director.



|                                                                 |                                       |                        |                          |                                                                                |                                                                                                  |                                                            |                 
|---------------------------------------------------------------- | ------------------------------------- | ---------------------- | ------------------------ | ------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------ | ---------------------------------------------------------- | ----------------
|Name                                                             | Fees Earned or Paid in Cash
      ($) | Stock Awards
      ($) | Option Awards 
      ($) | Non- 
      Equity 
      Incentive 
      Plan 
      Compensation 
      ($) | Nonqualified 
      Deferred 
      Compensation 
      Earnings Option 
      Awards 
      ($) | All 
      Other 
      Compen-sation 
      ($)
      ($) | Total 
      ($)
|                                                                 |                                       |                        |                          |                                                                                |                                                                                                  |                                                            |                 
|Slawek Kajko 
      President, Secretary 
      and Treasurer(1) | Nil                                   | Nil                    | Nil                      | Nil                                                                            | Nil                                                                                              | Nil                                                        | Nil             
|Edward Dere 
      Vice President(2)                             | Nil                                   | Nil                    | Nil                      | Nil                                                                            | Nil                                                                                              | Nil                                                        | Nil             
|Jim Grey
      Director                                          | $7,000                                | Nil                    | $316                     | Nil                                                                            | Nil                                                                                              | Nil                                                        | $7,316          
|Garry Bourns Director                                            | $11,000                               | Nil                    | Nil                      | Nil                                                                            | Nil                                                                                              | Nil                                                        | $11,000         
|Bernard Parkinson Director                                       | $7,000                                | Nil                    | Nil                      | Nil                                                                            | Nil                                                                                              | Nil                                                        | $7,000          
|Brad Weinert Director                                            | $9,000                                | Nil                    | $316                     | Nil                                                                            | Nil                                                                                              | Nil                                                        | $9,316          



|(1) | Compensation paid to each of Mark Sampson and Ralph Proceviat is included above under the heading Summary Compensation Table.  Neither Mr. Sampson nor Mr. Proceviat received compensation for their services as directors during the fiscal year ended October 31, 2009
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



34



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Employment Contracts and Termination of Employment and Change in Control Arrangements



We have not entered into any employment agreement or consulting agreements with our directors and executive officers. There are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers. Our directors and executive officers may receive stock options at the discretion of our board of directors in the future. We do not have any material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers.



Pension, Retirement or Similar Benefit Plans



Effective January 1, 2008, we established a 401(k) defined contribution retirement savings plan under which eligible U.S. employees may choose to defer a portion of their eligible compensation on a pre-tax basis, subject to certain IRS limitations. The 401(k) Plan qualifies under Section 401(k) of the United States Internal Revenue Code of 1986, as amended.  Our company may at its sole discretion match employee contributions.   We did not make matching contributions in the year ended October 31, 2009.



There are no arrangements or plans in which we provide any other pension, retirement or similar benefits for directors or executive officers. We have no material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers.



ITEM 12.   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.



Securities Authorized for Issuance under Equity Compensation Plans



Effective September 28, 2009, we adopted our 2009 Stock Option Plan.  The following table sets outs certain information concerning securities reserved for issuance under the 2009 Stock Option Plan as of October 31, 2009:



|                                                           |                                                                                     |                                                                  |                                                                                                                                                        
|---------------------------------------------------------- | ----------------------------------------------------------------------------------- | ---------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------
|Plan Category                                              | Number of common shares to be issued upon exercise of outstanding options
      (a) | Weighted-average exercise price of outstanding options
      (b) | Number of common shares remaining available for future issuance under equity compensation plan (excluding securities reflected in column (a))
      (c)
|Equity compensation plans approved by security holders     | N/A                                                                                 | N/A                                                              | N/A                                                                                                                                                    
|Equity compensation plans not approved by security holders | 9,529,034                                                                           | $0.16                                                            | 5,470,966                                                                                                                                              
|Total                                                      | 9,529,034                                                                           | $0.16                                                            | 5,470,966                                                                                                                                              



2009 Stock Option Plan



The following description applies to our 2009 Stock Option Plan that was adopted on September 28, 2009.  9,529,034 options have been granted under this plan as of the date of this annual report on Form 10-K.



We have reserved for issuance an aggregate of 15,000,000 shares of common stock under the 2009 Stock Option Plan.  This plan is intended to encourage directors, officers, employees and consultants to acquire ownership of common stock.  The opportunity so provided is intended to foster in participants a strong incentive to put forth maximum effort for our continued success and growth, to aid in retaining individuals who put forth such efforts, and to assist in attracting the best available individuals to our company in the future.



Officers (including officers who are members of the board of directors), directors and other employees and consultants of our company, including our subsidiaries, will be eligible to receive options under the stock option plan.  The committee will administer the stock option plan and will determine those persons to whom options will be granted, the number of options to be granted, the provisions applicable to each grant and the time periods during which the options may be exercised.  No options may be granted more than ten years after the date of the adoption of the stock option plan.



35



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Non-qualified stock options will be granted by the committee with an option price equal to the fair market value of the shares of common stock to which the non-qualified stock option relates on the date of the grant.  The committee may, in its discretion, determine to price the non-qualified option at a different price.  In no event may the option price with respect to an incentive stock option granted under the stock option plan be less than the fair market value of such common stock to which the stock option relates on the date the stock option is granted.



Each option granted under the stock option plan will be exercisable for a term of not more than ten years after the date of grant.  Certain other restrictions will apply in connection with this plan when some awards may be exercised.  In the event of a change of control (as defined in the stock incentive plan); the date on which all options outstanding under the stock incentive plan may first be exercised will be accelerated.  Generally, all options terminate 90 days after a change in control.



Security Ownership of Certain Beneficial Owners and Management



As of January 27, 2010, there were 57,333,785 shares of our common stock outstanding. The following table sets forth certain information with respect to the beneficial ownership of our common stock by each stockholder known by us to be the beneficial owner of more than 5% of our common stock and by each of our current directors and executive officers. Each person has sole voting and investment power with respect to the shares of common stock, except as otherwise indicated. Beneficial ownership consists of a direct interest in the shares of common stock, except as otherwise indicated.



|                     |                                                                           |                                         |                        
|-------------------- | ------------------------------------------------------------------------- | --------------------------------------- | -----------------------
|Title of Class       | Name and Address of Beneficial Owner                                      | Number of Shares Beneficially Owned (1) | Percentage of Class (2)
|Director and Officer
|Common Stock         | Mark Sampson
      6204 Imperial Avenue
      West Vancouver, BC  V7W 2J2 | 6,232,771(3)                            | 10.7%                  
|Common Stock         | Ralph Proceviat
      4817 Oaktree Court
      Burnaby, BC  V5G 4K9       | 13,493,489(4)                           | 23.0%                  
|Common Stock         | Garry Bourns
      41 Strathlea Court SW
      Calgary, AB  T3H 4T4       | 3,500,175(5)                            | 6.10%                  
|Common Stock         | Brad Weinert
      8641 Dallas Street
      La Mesa, CA  91942            | Nil(6)                                  | Nil                    
|Common Stock         | Bernard Parkinson
      166 Somme Avenue SW
      Calgary, AB  T2T 6H6    | 2,625,175                               | 4.58%                  
|Common Stock         | James Grey
      2462 Carr Lane
      West Vancouver, BC  V7S 3H5         | Nil(7)                                  | Nil                    
|Common Stock         | Sherrill Aspin
      11646 94th Avenue
      Delta, BC  V4C 3R6           | 1,062,500(8)                            | 1.85%                  
|Common Stock         | Directors and Officers as 
      a group                                  | 26,914,110(3) (4)                       | 45.30%                 



|(1) | Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Except as otherwise indicated, we believe that the beneficial owners of the common stock listed above, based on information furnished by such owners, have sole investment and voting power with respect to such shares, subject to community property laws where applicable.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Percentage based on 57,333,785 shares of common stock outstanding on January 27, 2010, including shares of restricted stock subject to options or warrants currently exercisable or exercisable within 60 days of January 27, 2010, which are deemed outstanding for computing the percentage of the person holding such option or warrant but are not deemed outstanding for computing the percentage of any other person.           



36



---



|(3) | Does not include 1,312,500 options exercisable within 60 days, the exercise of which is conditional upon approval of the Plan. Includes warrants exercisable within 60 days that are owned by 885084 Alberta Inc., a company owned or controlled by Mark Sampson: 350,000 warrants, each of which entitles the holder to purchase one share of common stock at the exercise price of $0.20 per share on or before January 15, 2011, and 423,674 warrants each of which entitles the holder to purchase one share of common stock at the exercise price of $1.00 per share on or before January 6, 2012.                                                                                                                                                                                                    
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(4) | Includes 6,933,066 common shares owned by 0793296 B.C. Ltd., a company owned or controlled by Ralph Proceviat, and 350,000 common shares owned by Level 10 Capital Corp, a company owned or controlled by Ralph Proceviat. Also includes 1,225,000 warrants exercisable within 60 days that are owned by 0793296 B.C. Ltd, 875,000 of which entitle the holder to purchase one common share at the exercise price of $0.10 per share until June 29, 2011, and 350,000 of which entitle the holder to purchase one common share at the exercise price of $0.20 per share until January 15, 201. Does not include 875,000 options held by Ralph Proceviat and 1,129,034 options held by 0792396 B.C. Ltd that are exercisable within 60 days, the exercise of which is conditional upon approval of the Plan.
|(5) | Includes 875,000 common shares are owned by 1125173 Alberta Ltd., a company owned or controlled by Garry Bourns.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|(6) | Does not include 437,500 options exercisable within 60 days, the exercise of which is conditional upon approval of the Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(7) | Does not include 437,500 options exercisable within 60 days, the exercise of which is conditional upon approval of the Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(8) | Does not include 175,000 options exercisable within 60 days, the exercise of which is conditional upon approval of the Plan. Includes 500,000 shares owned by Sherrill Aspins spouse.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     



Changes in Control



In connection with a share purchase agreement dated October 28, 2009, our former president and director agreed to return to treasury 40,800,000 restricted shares of our common stock in exchange for the acquisition of all of the issued and outstanding  shares of Westside Publishing Ltd. By a return to treasury agreement dated October 28, 2009, our other former officer and director agreed to return to treasury 20,000,000 restricted shares of our common stock.  As a result of these cancellations, which were effective as of October 30, 2009; the conversion of the $1,600,000 of debt into 19,250,000 restricted shares, which was effective November 10, 2009; and the non-brokered private placement of 1,754,524 units for cash proceeds of US$375,000 and in settlement of debt totaling US$502,262, which was effective January 6, 2010, the former shareholders of Nexaira hold 35,162,936 restricted shares, or 61.33% of the total 57,333,785 issued and outstanding shares.



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.



Transactions with Related Persons



Other than as listed below and disclosed in Items 7, 9, 11 and 12 of this Report, we have not been a party to any transaction, proposed transaction, or series of transactions in which, to our knowledge, any of our directors, officers, five percent beneficial security holder, or any member of the immediate family of the foregoing persons has had or will have a direct or indirect material interest since September 1, 2007.



Technology Publishing, Inc.



On June 1, 2007, we entered into and closed a share purchase agreement with Slawek Kajko, whereby we acquired all of the issued and outstanding shares of Westside Publishing Ltd. in consideration for the issuance of a promissory note for $28,047. The promissory note bears interest at Royal Bank of Canada Prime Interest Rate plus 2% annum and is unsecured. The principal and interest are due on June 1, 2012 or payable on demand. If we fail to pay on demand any payment of principal or interest on this promissory note, then the entire unpaid principal and all accrued and unpaid interest become due and payable without presentment, notice, protest or demand of any kind. During the years ended August 31, 2008 and 2007, we incurred interests of $2,909 under this promissory note.



As at August 31, 2008, we were indebted to Slawek Kajko for $14,189 for expenses paid for on our behalf, which does not include the promissory note for $28,047 issued in connection with the acquisition of Westside Publishing Ltd. This indebtedness for expenses paid for on our behalf by Mr. Kajko is non-interest bearing, unsecured and due on demand. During the years ended August 31, 2008 and 2007, the largest amount of principal outstanding for this indebtedness was $30,590. During the years ended August 31, 2008 and 2007, we have made the net repayment of $10,375 to Mr. Kajko for this indebtedness.



For the years ended August 31, 2008 and 2007, we recognized $12,000 for donated services and $3,000 for donated rent provided by Slawek Kajko.



As at August 31, 2009 we were indebted to Slawek Kajko, our former President, for $11,756 for expenses paid for on our behalf, which is non-interest bearing, unsecured and due on demand.



37



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As at August 31, 2009 we were indebted to Slawek Kajko, our former President, for $28,047 which bears interest at Royal Bank of Canada prime plus 2% per annum, is unsecured and the principal and interest are due on June 1, 2012. On June 1, 2007, the note was discounted at a rate of 15% for a net present value of $17,470. During the year ended August 31, 2009, $2,821 of the discount was amortized. During the year ended August 31, 2009, the Company incurred interest of $2,568. This note payable was issued as consideration for acquiring all the issued and outstanding common stock of Westside.



During the year ended August 31, 2009, we recognized $12,000 for donated services and $3,000 for donated rent provided by Slawek Kajko, our former President.



On October 28, 2009, Slawek Kajko, our former president, agreed to purchase all of the issued and outstanding shares of our subsidiary, Westside Publishing Inc., in exchange for the return of the 40,800,000 restricted shares of our common stock to us for the sole purpose of retiring the shares.



On October 28, 2009, we agreed to indemnify Edward Dere, our former director, for any possible liabilities arising from, or in any way attributable to his prior service as a director and/or officer of our company.  In exchange, Mr. Dere agreed to return 20,000,000 restricted shares of our common stock to us for the sole purpose of retiring the shares.



Convertible Debenture



On June 19, 2007, we entered into a Convertible Loan Agreement with 0793296 B.C. Ltd (the Lender) for total borrowings of up to $3,000,000.  Our Chief Financial Officer is an officer of the Lender.



For the years ended October 31, 2009 and 2008, interest expense incurred in connection with the convertible debenture totaled $203,149 and $107,714, respectively. Interest paid to the Lender was $83,722 and $103,792 for the years ended October 31, 2009 and 2008, respectively.



Working Capital Loans from Related Parties



As of October 31, 2009, $681,349, which is net of debt discount of $6,046, is outstanding under the working capital loans from related parties, for total proceeds in the amount of $687,395 which is comprised of the following:



-

On July 9, 2009, 0793296 B.C. Ltd. advanced $50,000 for short-term working capital needs. The loan bears interest at 12% per annum and is payable quarterly commencing October 1, 2009.  Interest increases to 15% per annum after October 31, 2009 until the loan is repaid.



-

In October, 2009 0793296 B.C. Ltd advanced $275,000 for short-term working capital needs under promissory note agreements, of which $200,000 is to be applied to a form of subscription agreement in connection with our private placement offering subsequent to October 31, 2009.  The notes bear interest at 18% per annum and are payable quarterly commencing January 2010. Total interest payable in connection with the advances as of October 31, 2009 is $4,167.



-

On August 27, 2009, the Board of Directors approved the borrowing of funds through a factoring company (the Factoring Co.) for working capital needs. The proceeds are funded by 0840386 B.C. Ltd. and/or its nominees 0793296 B.C. Ltd, and 0885084 Alberta Inc., a company related to our Chief Executive Officer, Chief Financial Officer, and other third party investors. The funds advanced under the terms of the factoring agreement bear a factoring fee of 2% per month.  We received three advances for total of $362,395 under the agreement, which remain outstanding as of October 31, 2009. Total interest payable related to the borrowings as of October 31, 2009 is $20,157.



We issued warrants to the Factoring Co. to purchase up to 700,000 shares of our common stock for eighteen months from the date of investment at $0.20 per share.  We recorded the fair value of the warrants under the Black-Scholes model as debt discount totaling $12,000.   Accretion of the debt discount totaled $5,955 as of October 31, 2009.



38



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Consulting Agreement



On March 17, 2008, we entered into a Consulting and Management Services Agreement (the Consulting Agreement) with Level Ten Corporate Services, Inc. (Level Ten).  Our Chief Financial Officer is also an officer of Level Ten. The Consulting Agreement provides for our Chief Executive Officer and Chief Financial Officer (the Consultants) to provide certain management consulting services to us. The Consulting Agreement calls for monthly retainer of $15,000. The Consulting Agreement also provides for options to purchase up to 750,000 shares of common stock at the exercise price of $0.40 per share to our Companys Chief Executive Officer and Chief Financial Officer.



On May 15, 2008, the Consultants were appointed to the Board of Directors of Nexaira Inc. On July 22, 2008, the Consultants were also appointed as Officers of Nexaira Inc.



On June 1, 2008, we amended the Consulting Agreement with the Consulting Company, raising the monthly retainer to $23,313 ($25,000 Canadian Dollars). Total payments for management services under the Consulting Agreements for the year ending October 31, 2009 and 2008 were $240,975 and $180,796, respectively.



Effective November 1, 2008 the Board of Directors approved the increase of our Chief Executive Officer and Chief Financial Officer consulting fees to USD$35,000 per month. The Consultants agreed to defer the increase until additional funding is raised by the Company.  As October 31, 2009 deferred consulting fees outstanding totaled $179,025.



Repayment of Shareholder Loans



On January 3, 2006 former Officers of Nexaira Inc. entered into an Asset Purchase Agreement whereby Nexaira Inc. assumed the lease for the Canadian facilities and acquired certain assets and customer contracts from its then-Chief Executive Officer and Vice President of Engineering.  The Asset Purchase Agreement was structured as a Section 85 tax deferred transaction under the Canadian Income Tax Act. Under the terms of the tax-deferred exchange transaction, we issued 1,000,000 shares of common stock in connection with the transaction and recorded loans due to the shareholders.



In November 2007, Nexaira Inc. entered into an agreement with its former Chief Executive Officer and Vice President of Engineering to repay shareholder loan balances outstanding totaling $162,994. In connection with the agreement, we transferred Canadian accounts receivables outstanding as of October 31, 2007 totaling $105,187, and, fixed assets and other prepaids totaling $19,840. The remaining amount of $37,967 was paid in cash to the shareholders in January 2008.



In November 2007, our former Chief Executive Officer and Vice President of Engineering formed Puracom, an unrelated company. During the year ended October 31, 2009 and 2008, we retained the services of Puracom for research and development services for total fees of $10,396 and $42,805, respectively



Private Stock Purchase Transaction



On June 11, 2008, the parent company of the Lender (0793296 B.C. Ltd) entered into a private agreement with a former Officer of the Company to purchase his common stock ownership interest in the Company totaling 650,000 shares of the Companys common stock for total purchase price of $127,000 ($130,000 Canadian Dollars).



Director Independence



For the year ended August 31, 2009, we acted with two directors. As Slawek Kajko was our president, secretary and treasurer and Edward Dere was our vice president, neither Mr. Kajko nor Mr. Dere were independent directors as the term is used in Nasdaq Rule 4200(a)(15). As at January 27, 2010,  we  have four independent directors, being Messrs. Weinert, Grey, Bourns and Parkinson.



National Instrument 52-110



We are a reporting issuer in the Province of British Columbia. National Instrument 52-110 of the Canadian Securities Administrators requires our company, as a venture issuer, to disclose annually in our annual report certain information concerning the constitution of our audit committee and our relationship with our independent auditor. As defined in National Instrument 52-110, Messrs. Weinert and Grey are independent directors.  For a description of the education and experience of our audit committee members that is relevant to the performance of their respective responsibilities as audit committee members, please see the disclosure under the heading Item 10. Directors, Executive Officers and Corporate Governance  Business Experience.



39



---

Our audit committee was formed on October 26, 2009.  Messrs. Grey and Proceviat,audit committee members, are financially literate, as defined in National Instrument 52-110, as they have the industry experience necessary to understand and analyze financial statements of our company, as well as the understanding of internal controls and procedures necessary for financial reporting and as a result, have the necessary financial expertise to be classified as financially literate.



The audit committee is responsible for review of both interim and annual financial statements for our company. For the purposes of performing their duties, the members of the audit committee have the right at all times, to inspect all the books and financial records of our company and any subsidiaries and to discuss with management and the external auditors of our company any accounts, records and matters relating to the financial statements of our company. The audit committee will meet periodically with management and annually with the external auditors.



Since the commencement of our companys most recently completed financial year, our companys board of directors has not failed to adopt a recommendation of the audit committee to nominate or compensate an external auditor.



Since the commencement of our companys most recently completed financial year, our company has not relied on the exemptions contained in sections 2.4 or 8 of National Instrument 52-110. Section 2.4 (De Minimis Non-audit Services)provides an exemption from the requirement that the audit committee must pre-approve all non-audit services to be provided by the auditor, where the total amount of fees related to the non-audit services are not expected to exceed 5% of the total fees payable to the auditor in the fiscal year in which the non-audit services were provided. Section 8 (Exemptions)permits a company to apply to a securities regulatory authority for an exemption from the requirements of National Instrument 52-110 in whole or in part.



The audit committee has adopted specific policies and procedures for the engagement of non-audit services as set out in the Audit Committee Charter of our company. A copy of our companys Audit Committee Charter is filed as an exhibit to this annual report.



National Instrument 58-110



We are a reporting issuer in the Province of British Columbia.  National Instrument 58-110 of the Canadian Securities Administrators requires our company, as a venture issuer, to disclose annually in our annual report certain information concerning corporate governance disclosure.



Board of Directors



Our board of directors currently acts with six members consisting of Mark Sampson, Ralph Proceviat, Brad Weinert, James Grey, Garry Bourns and Bernard Parkinson. We have determined that Messrs. Sampson and Proceviat are not independent as that term is defined in National Instrument 52-110 due to the fact that they are officers of our company.  Messrs Weinert, Grey, Bourns and Parkinson are independent.



Our board of directors facilitates its exercise of independent supervision over management by endorsing the guidelines for responsibilities of the board as set out by regulatory authorities on corporate governance in Canada and the United States.  Our boards primary responsibilities are to supervise the management of our company, to establish an appropriate corporate governance system, and to set a tone of high professional and ethical standards.



The board is also responsible for:



-

selecting and assessing members of the board;

-

choosing, assessing and compensating the president, secretary and treasurer of our company, approving the compensation of all executive officers and ensuring that an orderly management succession plan exists;

-

reviewing and approving our companys strategic plan, operating plan, capital budget and financial goals, and reviewing its performance against those plans;

-

adopting a code of conduct and a disclosure policy for our company, and monitoring performance against those policies;

-

ensuring the integrity of our companys internal control and management information systems;

-

approving any major changes to our companys capital structure, including significant investments or financing arrangements; and

-

reviewing and approving any other issues which, in the view of the board or management, may require board scrutiny.



40



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Directorships



Other than as set out below, our directors are not currently directors of any other reporting issuers (or the equivalent in a foreign jurisdiction).



|                  |                                     |                      |                    
|----------------- | ----------------------------------- | -------------------- | -------------------
|Name of Director  | Name of Reporting Issuer            | Exchange             | Term               
|Bernard Parkinson | Platinum Communications Corporation | TSX Venture Exchange | May 2009 to Present



Orientation and Continuing Education



We have an informal process to orient and educate new recruits to the board regarding their role on the board, our committees and our directors, as well as the nature and operations of our business.  This process provides for an orientation with key members of the management staff, and further provides access to materials necessary to inform them of the information required to carry out their responsibilities as a board member. This information includes the most recent board approved budget, the most recent annual report, the audited financial statements and copies of the interim quarterly financial statements.

The board does not provide continuing education for its directors.  Each director is responsible to maintain the skills and knowledge necessary to meet his obligations as director.



Nomination of Directors



The board is responsible for identifying new director nominees.  In identifying candidates for membership on the board, the board takes into account all factors it considers appropriate, which may include strength of character, mature judgment, career specialization, relevant technical skills, diversity and the extent to which the candidate would fill a present need on the board.  As part of the process, the board, together with management, is responsible for conducting background searches, and is empowered to retain search firms to assist in the nominations process.  Once candidates have gone through a screening process and met with a number of the existing directors, they are formally put forward as nominees for approval by the board.



Assessments



The board intends that individual director assessments be conducted by other directors, taking into account each directors contributions at board meetings, service on committees, experience base, and their general ability to contribute to one or more of our companys major needs.  However, due to our stage of development and our need to deal with other urgent priorities, the board has not yet implemented such a process of assessment.



ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.



The aggregate fees billed for the fiscal years ended August 31, 2009 and 2008 for professional services rendered by Manning Elliott LLP for the audit of our annual financial statements prior to the year end change to October 31,2009 and review of the financial statements included in our quarterly reports on Form 10-Q or services that were provided by Manning Elliott LLP in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:



|                                 |                 |                
|-------------------------------- | --------------- | ---------------
|                                 | Year Ended     
|                                 | August 31, 2009 | August 31, 2008
|                                 |                 |                
|Audit Fees  Manning Elliott LLP | $20,050         | $31,500        
|Audit Related Fees               | $nil            | $nil           
|Tax Fees                         | $nil            | $nil           
|All Other Fees                   | $nil            | $nil           
|Total                            | $20,050         | $31,500        



The aggregate fees billed or expected to be billed for the most recently completed fiscal years ended October 31, 2009 and 2008 for professional services rendered by BDO Seidman LLP for the audit of our annual financial statements and review of the financial statements included in our quarterly reports on Form 10-Q or services that are normally provided by BDO Seidman LLP in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:



41



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|                             |                  |                 
|---------------------------- | ---------------- | ----------------
|                             | Year Ended      
|                             | October 31, 2009 | October 31, 2008
|                             |                  |                 
|Audit Fees  BDO Seidman LLP | $64,000          | $112,000        
|Audit Related Fees           | $nil             | $nil            
|Tax Fees                     | $nil             | $nil            
|All Other Fees               | $nil             | $nil            
|Total                        | $64,000          | $112,000        



Pre-Approval Policies and Procedures



Our board of directors pre-approves all services provided by our independent auditors. All of the above services were reviewed and approved by our board of directors before such services were rendered.



Our board of directors has considered the nature and amount of fees billed by Manning Elliott LLP and BDO Seidman, LLP and believes that the provision of services for activities unrelated to the two audits conducted for the fiscal years ended August 31, 2009 and October 31, 2009 as applicable is compatible with maintaining the independence of Manning Elliott LLP and BDO Seidman, LLP.



ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.



|        |                                                                                                                                                                                                                                                                                                                                                                        
|------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |                                                                                                                                                                                                                                                                                                                                                                        
|Number  | Description                                                                                                                                                                                                                                                                                                                                                            
|       
|**(3)** | Articles of Incorporation and Bylaws                                                                                                                                                                                                                                                                                                                                   
|        |                                                                                                                                                                                                                                                                                                                                                                        
|3.1     | Articles of Incorporation (incorporated by reference from our registration statement on Form S-1/A filed on October 10, 2008)                                                                                                                                                                                                                                          
|       
|3.2     | Bylaws (incorporated by reference from our registration statement on Form S-1/A filed on October 10, 2008)                                                                                                                                                                                                                                                             
|       
|3.3     | Amendment to Articles of Incorporation and Bylaws  8 for 1 forward split (incorporated by reference from our Form 8-K filed on September 24, 2009)                                                                                                                                                                                                                    
|       
|(10)    | Material Contracts                                                                                                                                                                                                                                                                                                                                                     
|       
|10.1    | Form of Subscription Agreement used in a private placement offering that closed on July 25, 2007 between our company and 32 investors (incorporated by reference from our registration statement on Form S-1/A as filed with the Commission on October 10, 2008)                                                                                                       
|       
|10.2    | Share Exchange Agreement dated September 29, 2009 (incorporated by reference from our current report on Form 8-K as filed with the Commission on October 2, 2009)                                                                                                                                                                                                      
|       
|10.3    | Assumption Agreement dated September 29, 2009 (incorporated by reference from our current report on Form 8-K as filed with the Commission on October 2, 2009)                                                                                                                                                                                                          
|       
|10.4    | Return to Treasury Agreement dated October 28, 2009 between our company and Edward Dere (incorporated by reference from our current report on Form 8-K as filed with the Commission on November 9, 2009)                                                                                                                                                               
|       
|10.5    | Share Purchase Agreement dated October 29, 2009 between our company and Slawek Kajko (incorporated by reference from our current report on Form 8-K as filed with the Commission on November 9, 2009)                                                                                                                                                                  
|        |                                                                                                                                                                                                                                                                                                                                                                        
|10.6    | Form of Stock Option Agreement (incorporated by reference from our current report on Form 8-K as filed with the Commission on November 9, 2009)                                                                                                                                                                                                                        
|       
|10.7    | Form of Debt Conversion Subscription Agreement (incorporated by reference from our annual report on Form 10-K for the year ended August 31, 2009 as filed with the Commission on November 18, 2009). Form of Subscription Agreement for Non-US Persons (incorporated by reference from our current report on Form 8-K as filed with the Commission on January 11, 2010)



42



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|      |                                                                                                                                                                                                                       
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.8  | Form of Assumption Agreement (incorporated by reference from our current report on Form 8-K as filed with the Commission on January 11, 2010)                                                                         
|     
|10.9  | Form of Debt Conversion Agreement (incorporated by reference from our current report on Form 8-K as filed with the Commission on January 11, 2010)                                                                    
|     
|(14)  | Code of Ethics                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                       
|14.1  | Code of Ethics(incorporated by reference from our annual report on Form 10-K for the year ended August 31, 2009 as filed with the Commission on November 18, 2009)                                                    
|     
|(21)  | Subsidiaries                                                                                                                                                                                                          
|      |                                                                                                                                                                                                                       
|21    | Direct and Indirect Wholly-Owned Subsidiaries of Nexaira Wireless Inc.:                                                                                                                                               
|      | Nexaira Inc., an Alberta company                                                                                                                                                                                      
|      | Nexaira, Inc., a California company                                                                                                                                                                                   
|     
|31.1* | Certification of Principal Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                          
|     
|31.2* | Certification of Principal Financial Officer and Principal Accounting Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                         
|     
|32*   | Certification of Principal Executive Officer and Principal Financial Officer and Principal Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|     
|(99)  | Additional Exhibits                                                                                                                                                                                                   
|      |                                                                                                                                                                                                                       
|99.1  | Audit Committee Charter (incorporated by reference from our Annual Report on Form 10-K for the year ended August 31, 2009 as filed with the Commission on November 18, 2009)                                          

*      Filed herewith



43



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SIGNATURES





Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.





NEXAIRA WIRELESS INC.



/s/ Mark Sampson

By: Mark Sampson
President, Chief Executive Officer and Director 
(Principal Executive Officer)

Dated: January 29, 2010



/s/ Ralph Proceviat

By: Ralph Proceviat
Treasurer and Director 
(Principal Financial Officer and Principal Accounting Officer)

Dated: January 29, 2010





Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.



/s/ Mark Sampson

By: Mark Sampson
President, Chief Executive Officer and Director 
(Principal Executive Officer)

Dated: January 29, 2010



/s/ Ralph Proceviat

By: Ralph Proceviat
Treasurer and Director 
(Principal Financial Officer and Principal Accounting Officer)

Dated: January 29, 2010





|                                                                |                                                                    
|--------------------------------------------------------------- | -------------------------------------------------------------------
|/s/ James Grey
By: James Grey
 Director
Dated: January 29, 2010 | /s/ Brad Weinert
By: Brad Weinert
Director 
Dated: January 29, 2010





44



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