gawk_10q.htm

CONSOLIDATED BALANCE SHEETS

	January 31,			January 31,
	2017			2016
ASSETS
Current Assets
Cash and cash equivalents	$	133,249		$	64,944
Accounts receivable, net		232,305			45,721
Marketable securities - available for sale		102,300			78,300
Deposit - CipherLoc		-			562,500
Prepaid and other current assets		54,028			32,200
Total Current Assets		521,882			783,665

Equipment, net of accumulated depreciation of $0 and $73,740		-			103,235
Intangible assets and proprietary technology, net of accumulated amortization of $656,244 and $312,173		1,149,831			2,286,345
Goodwill		1,416,851			4,076,505
TOTAL ASSETS	$	3,088,564		$	7,249,750

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable and accrued liabilities	$	1,953,401		$	717,469
Note payable, net of unamortized discounts of $1,546 and $0		98,930			85,000
Current portion of notes payable -related party		614,085			868,361
Current portion of convertible notes payable, net of unamortized discounts of $598,790 and $148,069		2,061,952			1,934,932
Investor payable - common shares		658,000			658,000
Preferred shares payable		-			13,438
Contingent consideration		-			1,000,000
Due to related parties		305,458			27,942
Derivative liabilities		2,088,684			620,237
Total Current Liabilities		7,780,510			5,925,379
Long-Term Liabilities
Convertible notes payable, net of unamortized discounts of $0 and $56,358		-			10,307
Notes payables -related party, less current portion		159,514			388,889
TOTAL LIABILITIES		7,940,024			6,324,575

Series C Convertible Preferred stock, $0.001 par value, 100 shares designated; 16 and 14 shares issued and outstanding, respectively		16,000,000			14,000,000
Series D Convertible Preferred stock, $0.001 par value, 1,000 shares designated; 21 and 0 shares issued and outstanding, respectively		2,100,000			-
		18,100,000			14,000,000

Stockholders' Deficit
Preferred stock, $0.001 par value; authorized 100,000,000 shares
Series A Preferred stock, $0.001 par value, 1,000 shares designated; 1,000 shares issued and outstanding		1			1
Series B Convertible Preferred stock, $0.001 par value, 95,000,000 shares designated; 68,187,500 and 50,000,000 shares issued and outstanding, respectively		68,188			50,000
Common stock, $0.001 par value, 14,900,000,000 shares authorized; 2,357,089,633 and 261,863,258 shares issued and outstanding, respectively		2,357,089			261,863
Additional paid-in capital		984,577			670,962
Accumulated deficit		(26,361,315	)		(14,057,651	)
Total Stockholders' Deficit		(22,951,460	)		(13,074,825	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	3,088,564		$	7,249,750

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

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

	For the Year Ended
	January 31,
	2017			2016

Revenue	$	5,637,900		$	1,333,672
Cost of revenue		4,391,933			1,145,278
Gross profit		1,245,967			188,394

Operating expenses
General and administration		3,180,510			1,805,223
Research and development		-			2,500
Legal settlement		525,000			54,000
Impairment loss		4,369,707			562,500
Depreciation and amortization		746,487			155,736
Total operating expenses		8,821,704			2,579,959

Net loss from operations		(7,575,737	)		(2,391,565	)

Other income (expense)
Other income		22,275			13,200
Interest expense, net		(1,808,729	)		(544,616	)
Unrealized gain on marketable securities		24,000			49,350
Change in fair value of derivative liabilities		(1,351,818	)		326,899
Loss on settlement of debt		(1,629,773	)		(2,956,954	)
Total other expense		(4,744,045	)		(3,112,121	)

Loss from continuing operations		(12,319,782	)		(5,503,686	)

Gain (loss) from discontinued operations, net of tax benefits
Gain on sale of assets		111,467			-
Loss from discontinued operations		(95,349	)		(1,239,427	)
Total gain (loss) from discontinued operations		16,118			(1,239,427	)

Net loss	$	(12,303,664	)	$	(6,743,113	)

Dividend on Series B Preferred Stock		(23,344	)		-
Net loss attributable to common stockholders	$	(12,327,008	)	$	(6,743,113	)

Other comprehensive income		-			442

Comprehensive Loss	$	(12,327,008	)	$	(6,742,671	)

Basic and diluted loss per common share from continued operation	$	(0.02	)	$	(0.03	)
Basic and diluted loss per common share from discontinued operation	$	0.00		$	(0.01	)

Weighted average number of common shares outstanding, basic and diluted		724,811,630			194,920,175

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

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

FOR THE YEARS ENDED JANUARY 31, 2017 AND 2016

	Series A Preferred Stock				Series B Preferred Stock				Common Stock				Additional Paid in			Accumulated Other Comprehensive
	Shares Outstanding		Amount		Shares Outstanding		Amount		Shares Outstanding			Amount	Capital (Deficiency)			Income (Loss)			Accumulated Deficit			Total

Balance, January 31, 2015	1,000		$	1		-	$	-		161,732,000	$	161,732	$	(823,401	)	$	(442	)	$	(7,314,538	)	$	(7,976,648	)

Common stock issued to directors	-			-		-		-		21,000,000		21,000		140,100			-			-			161,100
Common stock issued for services, financing fees and to settle accounts payable	-			-		-		-		22,282,156		22,282		145,903			-			-			168,185
Common stock issued for legal settlement	-			-		-		-		2,700,000		2,700		51,300			-			-			54,000
Common stock issued in exchange for warrants	-			-		-		-		4,960,000		4,960		491,040			-			-			496,000
Series A Preferred Shares returned and cancelled	(500	)		-		-		-		-		-		-			-			-			-
Series A and B Preferred shares issued for acquisition - Net D’s assets	500			-		11,562,500		11,562		5,000,000		5,000		452,125			-			-			468,687
Series B Preferred shares issued for cash	-			-		8,437,500		8,438		-		-		39,062			-			-			47,500
Series B Preferred shares issued for acquisition - Connexum	-			-		5,000,000		5,000		-		-		49,375			-			-			54,375
Series B Preferred shares issued for due to related parties	-			-		25,000,000		25,000		-		-		390,625			-			-			415,625
Contribution	-			-		-		-		-		-		5,000			-			-			5,000
Common stock issued from conversion of debt	-			-		-		-		44,189,102		44,189		77,769			-			-			121,958
Foreign currency translation	-			-		-		-		-		-		-			442			-			442
Reclassification of derivative liability from additional paid in capital	-			-		-		-		-		-		(586,250	)		-			-			(586,250	)
Derivative Resolution	-			-		-		-		-		-		238,314			-			-			238,314
Net loss	-			-		-		-		-		-		-			-			(6,743,113	)		(6,743,113	)

Balance, January 31, 2016	1,000		$	1		50,000,000	$	50,000		261,863,258	$	261,863	$	670,962		$	-		$	(14,057,651	)	$	(13,074,825	)

Stock-based compensation	-			-		-		-		-		-		361,000			-			-			361,000
Common stock issued for exercise of stock options	-			-		-		-		41,000,000		41,000		(41,000	)		-			-			-
Series B Preferred shares issued for –preferred stock payable	-			-		13,437,500		13,438		-		-		-			-			-			13,438
Series B Preferred shares issued for cash	-			-		4,750,000		4,750		-		-		15,250			-			-			20,000
Beneficial conversion feature on Series B Preferred share	-			-		-		-		-		-		23,344			-			-			23,344
Deemed dividend on amortization of beneficial conversion feature on Series B Preferred shares	-			-		-		-		-		-		(23,344	)		-			-			(23,344	)
Common stock issued for conversion of debt	-			-		-		-		2,054,226,375		2,054,226		(1,438,698	)		-			-			615,528
Derivative resolution	-			-		-		-		-		-		1,417,063			-			-			1,417,063
Net loss	-			-		-		-		-		-		-			-			(12,303,664	)		(12,303,664	)

Balance, January 31, 2017	1,000		$	1		68,187,500	$	68,188		2,357,089,633	$	2,357,089	$	984,577		$	-		$	(26,361,315	)	$	(22,951,460	)

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

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CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the Year Ended
	January 31,
	2017			2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(12,303,664	)	$	(6,743,113	)
Adjustments to reconcile net loss to net cash used in operating activities:
Common stock, options, and warrants issued for services		177,000			656,443
Common stock issued for legal settlement		-			54,000
Stock-based compensation		361,000			-
Amortization of debt discount and deferred financing fees		1,110,707			342,831
Unrealized gain on marketable securities		(24,000	)		(49,350	)
Amortization expense of intangible assets		746,487			155,736
Depreciation expense from discontinued operations		44,244			58,992
Amortization expense from discontinued operations		89,766			119,688
Bad debt expense		18,876			11,782
Loss on impairment of goodwill		3,626,635			1,200,003
Loss on impairment of intangible assets		180,572			-
Write off of Deposit		562,500			562,500
Loss on stock for liabilities		1,564,800			2,956,954
Loss on settlement of liabilities		64,973			-
Prepayment penalty		188,249			-
Change in fair value of derivative liabilities		1,351,818			(326,899	)
Gain on sale of asset		(111,467	)		-
Changes in operating assets and liabilities:
(Increase) decrease in operating assets:
Accounts receivable		(175,232	)		41,212
Prepaid expenses and other assets		(1,079	)		(32,200	)
Increase (decrease) in operating liabilities:
Accounts payable and accrued liabilities		910,520			241,407
Due to related parties		712,716			277,942
Accrued expenses		269,287			-
Net Cash Used In Operating Activities		(635,292	)		(472,072	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of XTELUS, net of cash acquired		397			-
Proceeds from sale of asset		401,052			-
Net cash paid for acquisition of Net D’s assets		-			(134,531	)
Net Cash Provided by (Used in) Investing Activities		401,449			(134,531	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable		147,050			75,000
Proceeds from convertible notes, net of original issue discounts and deferred financing fees		785,858			380,900
Proceeds from notes payable - related party		25,000			-
Payment of notes payable - related party		(582,903	)		-
Payment of convertible notes payable		(33,333	)		-
Payment of notes payable		(59,524	)		(92,750	)
Proceeds from issuance of Series B Preferred stock		20,000			47,500
Proceeds from issuance of common stock		-			5,000
Net Cash Provided By Financing Activities		302,148			415,650

Effect of exchange rate changes		-			442

Net increase (decrease) in cash and cash equivalents		68,305			(190,511	)
Cash and cash equivalents, beginning of period		64,944			255,455
Cash and cash equivalents, end of period	$	133,249		$	64,944

Supplemental cash flow information
Cash paid for interest	$	242,902		$	-
Cash paid for taxes	$	-		$	-

Non-cash financing transactions:
Series B and Series C Preferred shares issued for due to related parties	$	-		$	438,854
Acquisition of Net D’s assets through issuance of preferred shares, common shares and note payable	$	-		$	3,843,875
Acquisition of XTELUS through issuance of Series D Preferred shares	$	100,000		$	-
Series B Preferred shares issued to settle preferred share payable	$	13,438		$	-
Acquisition of Connexum/Webrunner through issuance of preferred shares and note payable	$	-		$	1,054,375
Contingent consideration related to acquisition of Connexum	$	-		$	1,000,000
Issuance of investor payable for acquisition	$	-		$	1,556,000
Issuance of common stock for conversion of debt and accrued interest	$	615,528		$	121,958
Common shares issued for deferred financing fees	$	-		$	13,042
Common stock issued for exercise of options and warrants	$	41,000		$	496,000
Debt discount from derivative liability	$	1,356,692		$	259,000
Reclassification of derivative liability from additional paid in capital due to tainted instruments	$	-		$	586,250
Derivative resolution	$	1,417,063		$	238,314
Accrued interest added to principal	$	5,517		$	-
Replacement of note payable to Convertible note	$	75,000		$	-
Acquisition of Connexum through contingent issuance of Series D Preferred shares	$	2,000,000		$	-
Series C Preferred shares issued to settle preferred share payable	$	-		$	1,000,000
Beneficial conversion feature on Series B Preferred shares	$	23,344		$	-

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

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Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JANUARY 31, 2017 AND 2016

NOTE 1 – DESCRIPTION OF BUSINESS

Gawk Incorporated (“we”, “our”, the “Company”) was incorporated in the state of Nevada on January 6, 2011 with principal business address at 5300 Melrose Avenue, Suite 42, Los Angeles, CA. The Company offers a suite of cloud communications, cloud connectivity, cloud computing, and managed cloud-based applications solutions to small, medium, and large businesses; and offers domestic and international voice services to communications carriers worldwide. It offers a suite of advanced data center and cloud-based services, including fault tolerant, high availability cloud servers, which comprise platform as a service, infrastructure as a service, and a content delivery network; managed network services that converge voice and data applications, structured cabling, wireless, and security services, as well as include Internet access via Ethernet or fiber at speeds ranging from 10 Mbps to 10 Gbps; and data center solutions, including cloud services, colocation services, and business continuity services, such as storage and security. Our website is located at www.gawkinc.com

NOTE 2 – GOING CONCERN

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. However, the Company has an accumulated deficit at January 31, 2017 of $26,361,315, a net loss for the year ended January 31, 2017 of $12,303,664, cash flows used in operating activities of $635,292 and needs additional cash to maintain its operations.

These factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company’s continued existence is dependent upon management’s ability to develop profitable operations, continued contributions from the Company’s executive officers to finance its operations and the ability to obtain additional funding sources to explore potential strategic relationships and to provide capital and other resources for the further development and marketing of the Company’s products and business.

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America. Significant accounting policies are as follows:

Use of Estimates and Assumptions

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and (iii) the reported amount of net revenues and expenses recognized during the periods presented. Adjustments made with respect to the use of estimates often relate to improved information not previously available. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of financial statements; accordingly, actual results could differ from these estimates. The Company’s most significant estimates relate to the valuation of its intangible assets, goodwill impairment, derivative liabilities, and the valuation of its common stock.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. We currently have no investments accounted for using the equity or cost methods of accounting.

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Reclassifications

Certain prior year amounts have been reclassified to conform with the current year presentation.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. At January 31, 2017 and 2016, cash and cash equivalents include cash on hand and cash in the bank.

Goodwill and Other Intangible Assets

We account for goodwill and intangible assets in accordance with ASC 350 "Intangibles-Goodwill and Other" ("ASC 350"). ASC 350 requires that goodwill and other intangibles with indefinite lives be tested for impairment annually or on an interim basis if events or circumstances indicate that the fair value of an asset has decreased below its carrying value. In addition, ASC 350 requires that goodwill be tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests when circumstances indicate that the recoverability of the carrying amount of goodwill may be in doubt. Application of the goodwill impairment test requires judgment, including the identification of reporting units; assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value. Significant judgments required to estimate the fair value of reporting units include estimating future cash flows, determining appropriate discount rates and other assumptions. Changes in these estimates and assumptions or the occurrence of one or more confirming events in future periods could cause the actual results or outcomes to materially differ from such estimates and could also affect the determination of fair value and/or goodwill impairment at future reporting dates.

We completed an evaluation of intangible assets and goodwill at January 31, 2017 and 2016, and recognized an impairment loss of $3,807,207 and $1,200,003 during the year ended January 31, 2017 and 2016.

The cost of intangible assets with determinable useful lives is amortized to reflect the pattern of economic benefits consumed, either on a straight-line or accelerated basis over the estimated periods benefited. Patents, technology and other intangibles with contractual terms are generally amortized over their respective legal or contractual lives. Customer relationships, brands and other non-contractual intangible assets with determinable lives are amortized over periods 3 years. When certain events or changes in operating conditions occur, an impairment assessment is performed and lives of intangible assets with determinable lives may be adjusted.

Long-Lived Assets

Long-lived assets are evaluated for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test is based on a comparison of the undiscounted future cash flows to the recorded value of the asset. If impairment is indicated, the asset is written down to its estimated fair value.

Property and Equipment

Property and equipment, consisting mostly of computer equipment, is recorded at cost reduced by accumulated depreciation. Depreciation expense is recognized over the assets’ estimated useful lives of three years using the straight-line method. Major additions and improvements are capitalized as additions to the property and equipment accounts, while replacements, maintenance and repairs that do not improve or extend the life of the respective assets, are expensed as incurred. Estimated useful lives are periodically reviewed and, when appropriate, changes are made prospectively. When certain events or changes in operating conditions occur, asset lives may be adjusted and an impairment assessment may be performed on the recoverability of the carrying amounts.

Accounts Receivable and Allowance for Uncollectible Accounts

Substantially all of the Company’s accounts receivable balance is related to trade receivables. Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments for services. Accounts with known financial issues are first reviewed and specific estimates are recorded. The remaining accounts receivable balances are then grouped in categories by the number of days the balance is past due, and the estimated loss is calculated as a percentage of the total category based upon past history. Account balances are charged against the allowance when it is probable that the receivable will not be recovered. As of January 31, 2017 and 2016, the Company had a valuation allowance for doubtful accounts of $18,876 and $0, respectively, for the Company’s accounts receivable. During the years ended January 31, 2017 and 2016, the Company recorded bad debt expense for uncollectible amounts of $18,876 and $11,782, respectively.

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Marketable securities and other investments

We classify these investments as current assets and carry them at fair value. We recognize all unrealized and realized gains and losses on our available-for-sale securities in other income in the accompanying consolidated statements of operations and comprehensive income (loss).

Revenue Recognition

The Company pursues opportunities to realize revenues from consulting services. It is the company’s policy that revenues and gains will be recognized in accordance with ASC Topic 605-10-25, “Revenue Recognition.” Under ASC Topic 605-10-25, revenue earning activities are recognized when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured.

Our Business Services revenue includes monthly recurring charges (“MRC”) to customers, for whom charges are contracted over a specified period of time, and variable usage fees charged to customers that purchase our business products and services. Revenue recognition commences after the provisioning, testing and acceptance of the service by the customer. MRCs continue until the expiration of the contract, or until cancellation of the service by the customer. To the extent that payments received from a customer are related to a future period, the payment is recorded as deferred revenue until the service is provided or the usage occurs.

Income Taxes

The Company utilizes the asset and liability method in accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for operating loss and tax credit carry-forwards and for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year 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 results of operations in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying amounts of deferred tax assets unless it is more likely than not that the value of such assets will be realized.

The Company uses the two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not, that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. The Company considers many factors when evaluating and estimating the Company's tax positions and tax benefits, which may require periodic adjustments. At January 31, 2017 and 2016, the Company did not record any liabilities for uncertain tax positions.

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Research and Development and Software Development Costs

Capitalization of certain software development costs are recorded after the determination of technological feasibility. Based on our product development process, technological feasibility is determined upon the completion of a working model. To date, costs incurred by us from the completion of the working model to the point at which the product is ready for general release have been insignificant. Accordingly, we have charged all such costs to research and development expense in the period incurred. Our research and development costs for the years ended January 31, 2017 and 2016 were $0 and $2,500, respectively.

Share-Based Compensation

The Company measures the cost of services received in exchange for an award of an equity instrument based on the grant-date fair value of the award. Employee awards are accounted for under ASC 718 - where the awards are valued at grant date. Awards given to nonemployees are accounted for under ASC 505 where the awards are valued at earlier of commitment date or completion of services. Compensation cost for employee awards is recognized over the vesting or requisite service period. The Black-Scholes option-pricing model is used to estimate the fair value of options or warrants granted.

Related Parties

The Company follows ASC 850, "Related Party Disclosures," for the identification of related parties and disclosure of related party transactions. See note 16.

Basic and Diluted Net Loss per Common Share

Basic income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. The weighted average number of shares is calculated by taking the number of shares outstanding and weighting them by the amount of time that they were outstanding. Diluted earnings per share reflects the potential dilution that could occur if stock options, warrants, and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. For the year ended January 31, 2017 and 2016, respectively, the following options, warrants, convertible notes and Series A convertible preferred stock were excluded from the computation of diluted net loss per shares as the result of the computation was anti-dilutive.

Diluted loss per share is the same as basic loss per share during periods where net losses are incurred since the inclusion of the potential common stock equivalents would be anti-dilutive as a result of the net loss.

Concentration of Credit Risk

All of the Company’s cash and cash equivalents are maintained in regional and national financial institutions. The Company has exposure to credit risk to the extent that its cash and cash equivalents exceed amounts covered by the U.S. federal deposit insurance; however, the Company has not experienced any losses in such accounts. In management’s opinion, the capitalization and operating history of the financial institutions are such that the likelihood of material loss is remote.

Derivative Financial Instruments

The fair value of an embedded conversion option that is convertible into a variable amount of shares and warrants that include price protection reset provision features are deemed to be “down-round protection” and, therefore, do not meet the scope exception for treatment as a derivative under ASC 815 “Derivatives and Hedging”, since “down-round protection” is not an input into the calculation of the fair value of the conversion option and warrants and cannot be considered “indexed to the Company’s own stock” which is a requirement for the scope exception as outlined under ASC 815.

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The accounting treatment of derivative financial instruments requires that the Company record the embedded conversion option and warrants at their fair values as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. The Company reassesses the classification of its derivative instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification.

The Black-Scholes option valuation model was used to estimate the fair value of the embedded conversion options and warrants. The model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time, of our common stock, equal to the weighted average life of the options.

Conversion options are recorded as debt discount and are amortized as interest expense over the life of the underlying debt instrument.

Fair Value of Financial Instruments

The Company's financial instruments consist primarily of cash, accounts payable and accrued expenses, and debt. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments.

The Company adopted ASC Topic 820, Fair Value Measurements (“ASC Topic 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The standard provides a consistent definition of fair value which focuses on an exit price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard also prioritizes, within the measurement of fair value, the use of market-based information over entity specific information and establishes a three-level hierarchy for fair value measurements based on the nature of inputs used in the valuation of an asset or liability as of the measurement date.

The three-level hierarchy for fair value measurements is defined as follows:

· Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; liabilities in active markets;

· Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability other than quoted prices, either directly or indirectly, including inputs in markets that are not considered to be active; or directly or indirectly including inputs in markets that are not considered to be active;

· Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement

The following table summarizes fair value measurements by level at January 31, 2017 and January 31, 2016 for assets measured at fair value on a recurring basis:

Carrying Value at January 31, 2017

January 31, 2017	Level 1		Level 2		Level 3		Total

Marketable securities- available for sale	$	102,300	$	-	$	-	$	102,300
Total assets		102,300		-		-		102,300

Derivative liabilities		-		-		2,088,684		2,088,684
Total liabilities	$	-	$	-	$	2,088,684	$	2,088,684

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Carrying Value at January 31, 2016

January 31, 2016	Level 1		Level 2		Level 3		Total

Marketable securities- available for sale	$	78,300	$	-	$	-	$	78,300
Total assets		78,300		-		-		78,300

Derivative liabilities		-		-		620,237		620,237
Total liabilities	$	-	$	-	$	620,237	$	620,237

Recent Accounting Pronouncements

In September 2017, the FASB has issued Accounting Standards Update (ASU) No. 2017-13, “Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of Prior SEC Staff Announcements and Observer Comments.” The amendments in ASU No. 2017-13 amends the early adoption date option for certain companies related to the adoption of ASU No. 2014-09 and ASU No. 2016-02. Both of the below entities may still adopt using the public company adoption guidance in the related ASUs, as amended. The effective date is the same as the effective date and transition requirements for the amendments for ASU 2014-09 and ASU 2016-02.

In May 2014, the FASB issued an accounting standards update which modifies the requirements for identifying, allocating, and recognizing revenue related to the achievement of performance conditions under contracts with customers. This update also requires additional disclosure related to the nature, amount, timing, and uncertainty of revenue that is recognized under contracts with customers. This guidance is effective for fiscal and interim periods beginning after December 15, 2017 and is required to be applied retrospectively to all revenue arrangements. The adoption of this guidance is not expected to have a significant impact on the Company’s consolidated financial statements.

In January 2017, the FASB has issued Accounting Standards Update (ASU) No. 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” These amendments eliminate Step 2 from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. Effective for public business entities that are a SEC filers for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. ASU 2017-04 should be adopted on a prospective basis.

In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. This new standard clarifies the definition of a business and provides a screen to determine when an integrated set of assets and activities is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This new standard will be effective for the Company on January 1, 2018, however, early adoption is permitted with prospective application to any business development transaction.

In December 2016, the FASB has issued Accounting Standards Update (ASU) No. 2016-20, “Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers.” The amendments affect narrow aspects of the guidance issued in ASU 2014-09 including Loan Guarantee Fees, Contract Costs, Provisions for Losses on Construction-Type and Production-Type Contracts, Disclosure of Remaining Performance Obligations, Disclosure of Prior Period Performance Obligations, Contract Modifications, Contract Asset vs. Receivable, Refund Liability, Advertising Costs, Fixed Odds Wagering Contracts in the Casino Industry, and Costs Capitalized for Advisors to Private Funds and Public Funds. The effective date and transition requirements for the amendments are the same as the effective date and transition requirements for FASB Accounting Standards Codification Topic 606. Public entities should apply Topic 606 (and related amendments) for annual reporting periods beginning after December 15, 2017, including interim reporting periods therein.

The Company is currently evaluating the method of adoption and the potential impact that Topic 606 may have on our financial position and results of operations.

Management has considered all recent accounting pronouncements issued. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.

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NOTE 4 – MARKETABLE SECURITIES

On September 4, 2014 Cloud issued 30,000 post-split common shares through a consulting agreement with Gawk Incorporated valued at $105,000. The common stock issued to Gawk, for consulting services, has been accounted for as a marketable security valued at $105,000. The services have been earned and completed in accordance with the agreement.

The Company fair valued the marketable security available for sale at January 31, 2017 and 2016 and recorded an unrealized gain on change in fair value of the asset of $24,000 and $49,350, respectively. Total fair value of the available for sale security at January 31, 2017 and 2016 is $102,300 and $78,300, respectively.

NOTE 5 – ACQUISITIONS

XTELUS LLC and XETLUS S.A.

On June 27, 2016, the Company entered into an acquisition agreement with NEOGEN Holdings LLC, whereby the Company acquired 100% of the membership interest of XTELUS LLC and XETLUS S.A. (“XTELUS”). The acquisition of XTELUS met the definition of a business in accordance with FASB ASC Topic 805, "Business Combinations". As such, the Company accounted for the acquisition as a business combination.

Management determined that the Company was the acquirer in the business combination in accordance with FASB ASC Topic 805, "Business Combinations," based on the following factors: (i) there was a change in control of XTELUS; (ii) the Company was the entity in the transaction that issued its equity instruments, and in a business combination, the acquirer usually is the entity that issues its equity interests; (iii) the Company's pre-transaction directors retained the largest relative voting rights of the Company post-transaction; (iv) the composition of the Company's current board of directors and management was the result of the appointment by the Company's pre-transaction directors.

The purchase price paid for the acquisition of XTELUS amounted to $100,000 and consisted of 1 Series D Preferred Stock, which is convertible into $100,000 of common shares at any time following 12 months from the issuance of such shares. The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date:

Fair Value of Consideration:	June 26, 2016
1 share of Series D Preferred Shares	$	100,000
Total Purchase Price	$	100,000

Assets and Liabilities:	June 26, 2016
Current assets	$	51,374
Current liabilities		(29,260	)
Goodwill		77,886
Fair value of total assets	$	100,000

Revenues of $922,912 and net loss of $58,297 since the acquisition date are included in the consolidated statements of operations and comprehensive income (loss) for the year ended January 31, 2017.

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Net D Consulting Inc.

On April 24, 2015, the Company entered into an asset purchase and sale agreement with Net D Consulting Inc. ("Net D") which closed on May 1, 2015. Net D is controlled by Chris Hall, who is an officer, director, and a controlling shareholder of the Company.

The fair value of the consideration and the assets acquired is based on the aggregate value of the note payable, preferred stock and common stock issued in exchange for the software as shown below:

The acquisition consisted of the purchase of a customer list which met the definition of a business in accordance with FASB ASC Topic 805, "Business Combinations". As such, the Company accounted for the acquisition as a business combination.

Management determined that the Company was the acquirer in the business combination in accordance with ASC Topic 805, "Business Combinations", based on the following factors: it involved a transaction or other event in which an acquirer obtains control of one or more businesses, which an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing a return in the form of dividends, lower costs, or other economic benefits directly to investors or other owners, members, or participants.

The purchase price paid for the assets acquired, as amended on December 21, 2015, amounted to $3,982,125 and consisted of the following: $150,000 in cash, a $350,000 note payable to a related party with 0% annual interest, 5,000,000 common shares valued at $66,500, 500 Series A Preferred shares valued at $0, 25,000,000 Series B Preferred shares valued at $415,625, and 3 Series C Preferred shares convertible into $3,000,000 common shares. The Company paid net cash of $134,531 for acquisition of Net D’s asset. The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date:

Fair Value of Consideration:
Cash	$	150,000
Note payable to related party		350,000
5,000,000 common shares		66,500
500 Series A Preferred shares		-
25,000,000 Series B Preferred shares convertible into common shares		415,625
3 Series C Preferred shares convertible into common shares		3,000,000
Total Purchase Price	$	3,982,125

Recognized amounts of identifiable assets acquired:
Assets:
Customer list	$	433,376
Goodwill		3,548,749
Fair value of total assets	$	3,982,125

Connexum, LLC.

On January 18, 2016, the Company entered into an acquisition agreement with Net D, whereby the Company acquired 100% of the membership interest of Connexum, LLC (“Connexum”) from Net D, a related party. The acquisition of Connexum met the definition of a business in accordance with FASB ASC Topic 805, "Business Combinations". As such, the Company accounted for the acquisition as a business combination. Net D and Connexum are controlled by Chris Hall, who is an officer, director, and a controlling shareholder of the Company.

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Management determined that the Company was the acquirer in the business combination in accordance with FASB ASC Topic 805, "Business Combinations", based on the following factors: (i) there was a change in control of Connexum; (ii) the Company was the entity in the transaction that issued its equity instruments, and in a business combination, the acquirer usually is the entity that issues its equity interests; (iii) the Company's pre-transaction directors retained the largest relative voting rights of the Company post-transaction; (iv) the composition of the Company's current board of directors and management was the result of the appointment by the Company's pre-transaction directors.

On January 18, 2016, the purchase price paid for the acquisition of Connexum amounted to $2,054,375 and consisted of the following: a $1,000,000 note with annual interest of 18% which matures on August 1, 2017 and 5,000,000 Series B Preferred shares valued at $54,375. The note provides for monthly principal and interest payments of $63,806. The agreement also provides for contingent consideration of 1 Series C Preferred share convertible into $1,000,000 common shares if Connexum achieves 80% of anticipated revenue and another 1 Series C Preferred share convertible into $1,000,000 common shares if Connexum achieves 100% of anticipated revenue within one year from the date of acquisition.

On January 16, 2017, the Company entered into amendment to acquisition agreement, to amend for issuing Series D Preferred Shares instead of issuing Series C Preferred shares, as follows;

10 Series D Preferred Shares of Gawk Incorporated, if Connexum achieves 80% of anticipated revenue and another 10 Series D Preferred Shares of Gawk Incorporated, if Connexum achieves 100% of anticipated revenue, for a total of 20 shares of Series D Preferred Shares of Gawk Incorporated. The Series D Preferred Shares will convert at the rate of $100,000 for each Series D Preferred Shares held.

On January 18, 2017, Connexum achieved 100% of anticipated revenue within one year from the date of acquisition. As a result, Gawk issued 20 Series D Preferred Shares and recognized additional goodwill of $1,000,000. Total goodwill generated from acquisition of Connexum was $1,416,851 as of January 31, 2017

The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date:

Fair Value of Consideration:	January 18, 2016
Note payable to related party	$	1,000,000
5,000,000 Series B Preferred shares		54,375
Contingent consideration – 20 Series D Preferred shares		2,000,000
Total Purchase Price	$	3,054,375

Fair Value of Consideration:	January 18, 2016
Current assets	$	86,132
Current liabilities assumed		(172,763	)
Customer list		1,724,155
Goodwill		1,416,851
Fair value of total assets	$	3,054,375

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Unaudited combined proforma results of operations for the year ended January 31, 2017 and 2016 as though the Company acquired Connexum, Net D, and XTELUS on February 1, 2015, are set forth below:

	January 31,
	2017			2016
Revenues	$	6,054,109		$	5,688,741
Cost of revenues		4,711,771			4,085,383
Gross profit		1,342,338			1,603,358

Operating expenses		8,992,236			4,082,657
Operating loss		(7,649,898	)		(2,479,299	)

Other expense		(4,744,045	)		(3,143,033	)

Gain (loss) from discontinued operations		16,118			(1,239,427	)
Net Loss	$	(12,377,825	)	$	(6,861,759	)

WebRunner, LLC

On October 30, 2014, the Company, through a comprehensive agreement with Webrunner, LLC (“Webrunner”), has purchased a complete data center. The Company sold WebRunner on October 31, 2016 (see Note 6).

The fair value of the consideration and the assets acquired is based on the aggregate value of the common stock issued in exchange for the software as shown below:

The acquisition consisted primarily of the purchase of a data center and all of its business, which are considered to meet the definition of a business in accordance with FASB ASC Topic 805, "Business Combinations". As such, the Company accounted for the acquisition as a business combination.

Management determined that the Company was the acquirer in the business combination in accordance with ASC Topic 805, "Business Combinations", based on the following factors: (i) there was a change in control of Webrunner; (ii) the Company was the entity in the transaction that issued its equity instruments, and in a business combination, the acquirer usually is the entity that issues its equity interests; (iii) the Company’s pre-transaction directors retained the largest relative voting rights of the Company post-transaction; (iv) the composition of the Company’s current board of directors and management was the result of the appointment by the Company’s pre-transaction directors.

The purchase price paid for the acquisition was $2,104,932 which included $225,000 in cash, 1 Series C Preferred share convertible into $1,000,000 of common stock and 9,100,000 options to purchase stock at an exercise price of $0.10 valued at $879,932 using the Black Scholes option pricing model. The assumptions used to value the options were as follows: a) stock price of $0.0978; b) strike price of $0.10, c) term of 5 years and d) volatility of 268%. The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date:

	October 30, 2014
Fair Value of Consideration:
Cash	$	225,000
1 Series C Preferred share convertible into common shares		1,000,000
9,100,000 options at an exercise price of $0.10		879,932
Total Purchase Price	$	2,104,932

Recognized amounts of identifiable assets acquired:
Assets:
Cash	$	190,931
IP Address		81,920
Customer list		359,067
Equipment		176,975
Goodwill		1,310,908
Fair value of total assets		2,119,801
Note payable RND Media		(10,000	)
Accounts payable and accrued liabilities		(4,869	)
Fair value of net assets	$	2,104,932

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Webrunner, Inc. assets includes IP Address space assigned to it through American Registry for Internet Numbers (ARIN) which consists of a /19, pronounced “Slash Nineteen”, which contains 8192 IP Addresses that are used in conjunction with our services provided to our customers.

An Internet Protocol address (IP address) is a numerical label assigned to each device (e.g., computer, printer) participating in a computer network that uses the Internet Protocol for communication. An IP address serves two principal functions: host or network interface identification and location addressing.

The designers of the Internet Protocol defined an IP address as a 32-bit number and this system, known as Internet Protocol Version 4 (IPv4), is still in use today. However, because of the growth of the Internet and the predicted depletion of available addresses, a new version of IP (IPv6), using 128 bits for the address, was developed in 1995. IPv6 was standardized as RFC 2460 in 1998, and its deployment has been ongoing since the mid-2000s.

IP addresses are usually written and displayed in human-readable notations, such as 172.16.254.1 (IPv4), and 2001:db8:0:1234:0:567:8:1 (IPv6).

The Internet Assigned Numbers Authority (IANA) manages the IP address space allocations globally and delegates five regional Internet registries (RIRs) to allocate IP address blocks to local Internet registries (Internet service providers) and other entities.

The expected of the Equipment, IP Addresses and Customer List is 3 years of which we will be applying both amortization and depreciation on a quarterly basis in a straight line format.

The comprehensive agreement call for the implementation of three employment agreement and three management agreements for the members of Webrunner LLC. The Company has not adopted an employee stock option plan which has been approved by the shareholders.

NOTE 6 – DISCONTINUED OPERATIONS

On October 31, 2016, the Company entered into the asset purchase and sale agreement (the “Agreement”) with Giggle Fiber, LLC. Pursuant to the terms of the Agreement, the Company sold the equipment, customer list of Webrunner and bank accounts related to Webrunner for $413,861, payable in installments. The Company recorded gain on sales of assets of $111,467 as discontinued operations during the year ended January 31, 2017. The total consideration received was $401,052.

The following table shows the results of operations of Webrunner for fiscal years 2017 and 2016 which are included in the gain (loss) from discontinued operations:

	Years Ended
	July 31,
	2017			2016
Revenue	$	225,575		$	318,484

Operating expenses
General and administration		(186,913	)		(179,228	)
Impairment loss		-			(1,200,003	)
Depreciation and amortization		(134,011	)		(178,680	)
Loss from discontinued operations	$	(95,349	)	$	(1,239,427	)

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NOTE 7 – EQUIPMENT

Equipment at January 31, 2017 and 2016 consist of the following:

	January 31, 2017		January 31, 2016
Acquisition of Webrunner - Equipment		-		176,975
Total tangible assets		-		176,975
Accumulated depreciation of tangible assets		-		(73,740	)
Total tangible assets	$	-	$	103,235

Depreciation expense for the years ended January 31, 2017 and 2016 amounted to $44,244 and $58,992, respectively. All depreciation expenses are included in loss from discontinued operations.

On October 31, 2016, the Company entered into the asset purchase and sale agreement (the “Agreement”) with Giggle Fiber, LLC. Pursuant to the terms of the Agreement, the Company sold the equipment, customer list of Webrunner and bank accounts related to the Webrunner for $413,861, payable in instalments. The total consideration received was $401,052. The Company recorded gain on sales of asset of $111,467 as discontinued operations during the year ended January 31, 2017 (See Note 16).

The following table summarizes the carrying amounts of the sold assets;

	October 31,
Assets	2016
Bank accounts related to Webrunner	$	12,809
Equipment, net of depreciation of $117,984		58,991
Intangible assets, net of amortization $239,378		119,689
Goodwill		110,905
Total assets	$	302,394

NOTE 8 – INTANGIBLES AND GOODWILL

Intangible assets at January 31, 2017 and 2016 consist of the following:

	January 31, 2017			January 31, 2016
Customer list - Webrunner	$	-		$	359,067
IP Address - Webrunner		81,920			81,920
Customer list - Net D		-			433,376
Customer list - Connexum		1,724,155			1,724,155
Total intangible assets		1,806,075			2,598,518
Accumulated amortization of intangible assets		(656,244	)		(312,173	)
Total intangible assets	$	1,149,831		$	2,286,345

The intangible assets are amortized over an estimated useful life of 3 years. Amortization expense from continuing operations amounted to $746,487 and $155,736 for the years ended January 31, 2017 and 2016, respectively. Amortization expense from discontinued operations amounted to $89,766 and $119,688 for the years ended January 31, 2017 and 2016, respectively.

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Goodwill at January 31, 2017 and 2016 consist of the following:

	January 31, 2017		January 31, 2016
Goodwill of Webrunner	$	-	$	110,905
Goodwill of Net D		-		3,548,749
Goodwill of Connexum		1,416,851		416,851
	$	1,416,851	$	4,076,505

During the year ended January 31, 2017, we determined that the carrying value of Net D and XTELUS, which are separate reporting units, exceeded its fair value at the measurement date, requiring step two in the impairment test process. The fair value of the Net D and XTELUS reporting unit were determined primarily using an income approach based on the present value of discounted cash flows. We determined the implied fair value of intangible asset and goodwill were substantially below the carrying value of the reporting unit. Accordingly, we recognized impairment loss of $180,572 in intangible asset and $3,548,749 in goodwill for Net D and $77,886 in goodwill for XTELUS, which resulted in no intangible asset and goodwill remaining for Net D and XTELUS as of January 31, 2017.

During the year ended January 31, 2016, we determined that the carrying value of Webrunner, which is a separate reporting unit, exceeded its fair value at the measurement date, requiring step two in the impairment test process. The fair value of the Webrunner reporting unit was determined primarily using an income approach based on the present value of discounted cash flows. We determined the implied fair value of goodwill was substantially below the carrying value of the reporting unit's goodwill. Accordingly, we recognized a goodwill impairment loss of $1,200,003, which resulted in goodwill of $110,905 remaining for Webrunner as of January 31, 2016.

NOTE 9 – NOTES PAYABLE

The Company had the following notes payable and notes payable - related party outstanding as of January 31, 2017 and 2016:

Notes Payable

	January 31, 2017			January 31, 2016
Dated – October 30, 2014	$	10,000		$	10,000
Dated – June 3, 2015		-			25,000
Dated – December 11, 2015		-			50,000
Dated – August 4, 2016		25,000			-
Dated – September 30, 2016		65,476			-
Total notes payable		100,476			85,000
Less: debt discount and deferred financing fees		(1,546	)		-
		98,930			85,000
Less: current portion of notes payable		98,930			85,000
Long-term notes payable	$	-		$	-

The Company recognized amortization expense related to the debt discount and deferred financing fees of $1,404 and $0 for the year ended January 31, 2017 and 2016, respectively. The total borrowings and principal repayment on note payable during the year ended January 31, 2017 was $147,050 and $59,524, respectively.

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Dated - October 30, 2014

On October 30, 2014, the Company exercised the comprehensive acquisition agreement of Webrunner, LLC (“Webrunner”) and in the acquisition the Company assumed the debt of RNC Media in the amount of $10,000. The Note does not have any interest payable and is due upon demand.

Dated - June 3, 2015 and December 11, 2015

The two notes were issued to Mr. Doyle Knudson, are subject to annual interest of 15% and are convertible into a total of 863,000 common shares. The note issued on June 3, 2015 matured in December 2015. On August 4, 2016, the Company entered into the new agreement with Crossover Capital Fund I, LLC, which the Company issued a new convertible note of $75,000 for the payment of the two notes totaling $75,000. As a result of this agreement, the Company recognized gain on debt settlement of $9,279 for the year ended January 31, 2017.

Dated – August 4, 2016

The note was issued to Mr. Doyle Knudson, are subject to annual interest of 15% and are secured by 250,000 shares of common stock. The note matured in February 2017. The total cash proceeds received from the note was $25,000

Dated – September 30, 2016

The Company entered into the revenue based factoring agreement with Powerup Lending Group, Ltd. and received cash of $125,000. The note includes an original issue discount and financing fee of $2,950 and the Company received cash of $122,050. The Company is required to make weekly principal and interest payments of $4,560 for a period of 34 weeks through May 30, 2017.

Notes Payable - related party

	January 31, 2017		January 31, 2016
Dated – April 23, 2015	$	231,250	$	282,250
Dated - January 18, 2016		-		975,000
Dated - December 21, 2016		542,349		-
Total notes payable		773,599		1,257,250
Less: current portion of notes payable		614,085		868,361
Long-term notes payable	$	159,514	$	388,889

The total borrowings and principal repayment on related party note payable during the year ended January 31, 2017 was $25,000 and $582,903, respectively

Dated - April 23, 2015

On May 1, 2015, in connection with the acquisition of the assets of Net D Consulting, Inc. (“Net D”), the Company issued a $350,000 note which bears no interest and matures on October 7, 2016. The Company made repayments on the note of $51,000 during the year ended January 31, 2017.

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Dated - January 18, 2016

On January 18, 2016, in connection with the acquisition of Connexum, the Company issued a $1,000,000 note to Net D which bears annual interest of 18%. The Company is required to make monthly principal and interest payments of $63,806 for a period of 18 months through August 1, 2017. The company incurred additional $25,000 borrowing from Net D during the year ended January 31, 2017. The Company paid principal and interest payments of $574,252 for the year ended January 31, 2017. On December 21, 2016, the Company entered into the new agreement which the company issued a note payable of $574,252 for payment of the old Note of $500,000. As a result, the Company recorded loss on debt extinguishment of $74,252 for the year ended January 31, 2017.

Dated – December 21, 2016

On December 21, 2016, the Company entered into the new agreement which the company issued a note payable of $574,252 for payment of the Note dated January 18, 2016. The Note bears interest rate of $7.29% for 1^st 12 months and then 3.25% for 13 through 18 months. The Company is required to make monthly principal and interest payments of $226,985 for a period of 18 months through June 20, 2018. The Company paid principal and interest payments of $48,956 for the year ended January 31, 2017.

NOTE 10 – CONVERTIBLE NOTES PAYABLE

The Company had the following convertible notes payable outstanding as of January 31, 2017 and 2016:

	January 31, 2017			January 31, 2016
Promissory Note - Issued August 22, 2014, with a fixed conversion price of $0.10 per common share or 17,000,000 shares of common stock.	$	1,700,000		$	1,700,000
Promissory notes – Issued in fiscal year 2016, with variable conversion features.		83,951			449,666
Promissory notes – Issued in fiscal year 2017, with variable conversion features.		876,791			-
Total convertible notes payable		2,660,742			2,149,666
Less: debt discount and deferred financing fees		(598,790	)		(204,427	)
		2,061,952			1,945,239
Less: current portion of convertible notes payable		2,061,952			1,934,932
Long-term convertible notes payable	$	-		$	10,307

The Company recognized amortization expense related to the debt discount and deferred financing fees of $1,109,303 and $342,831 for the year ended January 31, 2017 and 2016, respectively.

Promissory Note - August 22, 2014

In connection with the settlement agreement entered into with Doyle Knudson, an investor, in 2014, the Company issued a $1.8 million convertible promissory note with a fixed conversion price of $0.10 per share or 18,000,000 shares of common stock. The note is subject to annual interest of 10%, matured in August 2015 and is currently past due. In May and December 2015, a total of $100,000 note principal was transferred to another lender.

The Company initially recorded a discount on the convertible note due to a beneficial conversion feature of $358,200 and amortized $208,950 for the year ended January 31, 2016. Due to the variable conversion rates in the other convertible notes (see below), the $1,700,000 balance of the note became tainted and the embedded fixed conversion option was bifurcated and accounted for as a derivative liability.

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Promissory Notes - Issued in fiscal year 2016

During the year ended January 31, 2016, the Company issued a total of $449,666 notes with the following terms:

· Terms ranging from 9 months to 2 years

· Annual interest rates ranging from 5% to 12%

· Convertible at the option of the holders either at issuance or 180 days from issuance. The note dated September 29, 2015 is convertible at the later of the maturity date or date of default.

· Conversion prices are typically based on the discounted (50% to 60% discount) lowest trading prices of the Company’s shares during various periods prior to conversion. Certain notes allow for the conversion price to be the lower of $0.01 or the discounted trading price

Certain notes allow the Company to redeem the notes at rates ranging from 118% to 148% depending on the redemption date provided that no redemption is allowed after the 180^th day. Likewise, certain notes include original issue discounts totaling to $24,166. During the year ended January 31, 2016, the Company also recognized deferred financing fees totaling $55,142

The Company determined that the conversion feature met the definition of a liability in accordance with ASC Topic No. 815 - 40, Derivatives and Hedging - Contracts in Entity's Own Stock and therefore bifurcated the embedded conversion option once the note becomes convertible and accounted for it as a derivative liability. The fair value of the conversion feature was recorded as a debt discount and amortized to interest expense over the term of the note.

The Company valued the conversion feature using the Black Scholes valuation model. The fair value of the derivative liability for all the notes that became convertible during the year amounted to $459,733. $209,000 of the value assigned to the derivative liability was recognized as a debt discount to the notes while the balance of $250,733 was recognized as a day 1 derivative loss.

Promissory Notes - Issued in fiscal year 2017

During the year ended January 31, 2017, the Company issued a total of $1,266,417 notes with the following terms:

· Terms ranging from 9 months to 20 months

· Annual interest rates ranging from 8% to 12%

· Convertible at the option of the holders either at issuance or 180 days from issuance.

· Conversion prices are typically based on the discounted (50% to 60% discount) lowest trading prices of the Company’s shares during various periods prior to conversion. Certain notes allow for the conversion price to be a floor of $0.0005 and $0.00005 per share.

Certain notes allow the Company to redeem the notes at rates ranging from 118% to 150% depending on the redemption date provided that no redemption is allowed after the 180^th day. Likewise, certain notes include original issue discounts and deferred financing cost totaling to $146,976. The Company received cash of $785,858. During the year ended January 31, 2017, the Company repaid notes with principal amounts totaling to $33,333 and a total of $5,517 accrued interest was also added to principal.

The Company valued the conversion feature using the Black Scholes valuation model. The fair value of the derivative liability for all the notes that became convertible, including the notes issued in prior years, during the year ended January 31, 2017 amounted to $3,245,991. $1,356,692 of the value assigned to the derivative liability was recognized as a debt discount to the notes while the balance of $1,889,299 was recognized as a “day 1” derivative loss.

During the year ended January 31, 2017, the Company converted notes with principal amounts of $579,784 and accrued interest of $35,744 into 2,054,226,375 shares of common stock. The corresponding derivative liability at the date of conversion of $1,258,063 was credited to additional paid in capital.

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Replacement of Notes

During the year ended January 31, 2017, the Company assigned 16 notes with outstanding principal amounts totaling to $424,178 to two lenders which resulted to the payment of prepayment penalties amounting to $156,809 and recognized loss on debt settlement of $267,646 due to the modification of the replacement note conversion feature, and the difference between the fair value of derivative of the conversion feature.

The following table summarizes the detail of assigned 16 notes;

	Assigned Notes		Principal amount		Accrued interest		Prepayment penalties
Tranches in effect as of January 31, 2017		5	$	147,741	$	12,992	$	66,412

Tranches in not effect as of January 31, 2017
Tranches in effect as of February 12, 2017		5		69,549		5,472		22,507
Tranches in effect as of March 12, 2017		2		60,000		6,401		19,920
Tranches in effect as of April 12, 2017		2		71,131		5,188		22,895
Tranches in effect as of May 12, 2017		2		75,757		7,827		25,075
Total		16	$	424,178	$	37,880	$	156,809

During the year ended January 31, 2017, the Company assigned an additional 10 notes with principal amounts totaling to $375,750 to two lenders. Prepayment of $142,670 was paid by cash and recognized in interest expense, and $31,440 was non-cash and recognized as prepayment penalties.

NOTE 11 – DERIVATIVE LIABILITIES

The Company analyzed the conversion option for derivative accounting consideration under ASC 815, Derivatives and Hedging, and hedging, and determined that the instrument should be classified as a liability since the conversion option becomes effective at issuance resulting in there being no explicit limit to the number of shares to be delivered upon settlement of the above conversion options.

ASC 815 requires we assess the fair market value of derivative liability at the end of each reporting period and recognize any change in the fair market value as other income or expense item.

The Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of January 31, 2017. The Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each convertible note is estimated using the Black-Scholes valuation model. The following weighted-average assumptions were used in the January 31, 2017 and 2016:

	Year Ended			Year Ended
	January 31, 2017			January 31, 2016
Expected term	0 - 1.50 years			0.4 - 2 years
Expected average volatility	120% - 716		%	249% - 328		%
Expected dividend yield		-			0
Risk-free interest rate	0.18% - 0.84		%	0.05% - 0.83		%

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At January 31, 2017, the estimated fair values of the liabilities measured on a recurring basis are as follows:

January 31, 2017	Level 1		Level 2		Level 3		Total
Promissory Note – Issued August 22, 2014	$	-	$	-	$	3,400	$	3,400
Promissory Notes – Issued in fiscal year 2016		-		-		164,794		164,794
Promissory Notes – Issued in fiscal year 2017		-		-		1,920,490		1,920,490
Total liabilities	$	-	$	-	$	2,088,684	$	2,088,684

The following table summarizes the changes in the derivative liabilities during the year ended January 31, 2017:

Fair Value Measurements Using Significant Observable Inputs (Level 3)

Balance - January 31, 2015	$	-
Addition of new derivatives recognized as debt discounts		259,000
Addition of new derivatives recognized as options compensation		340,200
Addition of new derivatives recognized as day one loss on derivatives		469,730
Derivatives settled upon conversion of debt and exercise of warrants		(238,314	)
Reclassification from APIC to derivative due to tainted instruments		586,250
Loss on change in fair value of the derivative		(796,629	)
Balance - January 31, 2016	$	620,237

Addition of new derivatives recognized as debt discounts		1,356,692
Addition of new derivatives recognized as options compensation		177,000
Addition of new derivatives recognized as day one loss on derivatives		1,289,210
Derivatives settled upon conversion of debt and exercise of warrants		(1,417,063	)
Loss on change in fair value of the derivative		62,608
Balance - January 31, 2017	$	2,088,684

The net gain on derivatives during the year ended January 31, 2017 and 2016 was $1,351,818 and $326,899, respectively.

NOTE 12 – STOCK PAYABLE

Investor payable - common shares

In December 2013 and January 2014, the Company entered into stock purchase agreements with third parties for 100,000 and 250,000 Series B Preferred shares, respectively, for a total consideration of $100,000 and $250,000, respectively. The Company was unable to issue the preferred shares and has accounted for the amounts received as investor payable.

The Company also issued 8,000,000 Preferred B Warrants with the acquisition of Poker Junkies LLC. These Preferred Series B Warrants once exercised would require the Company to issue Series B Preferred shares. From November 2013 through January 31, 2014 the Company issued 1,028,000 of Series B Preferred stock valued at $1,028,000 for the exercise of the Preferred B warrants. From February 2014 through April 2014 the Company issued 699,200 of Series B Preferred stock valued at $699,200 for the exercise of the Preferred B warrants. On June 18, 2014, the Company rescinded this transaction due to the failure of the holder to deliver the Preferred B warrants. The Company decided to issue common shares in lieu of issuing the Series B Preferred shares related to the acquisition of Poker Junkies LLC and those issued in connection with the stock purchase agreements disclosed above. The Company agreed to issue common stock at 125% of the value of the Series B Preferred shares. During the years ended January 31, 2017 and 2016, the Company issued 0 and 4,960,000 common shares, respectively, for a total consideration of $0 and $496,000, respectively.

As of January 31, 2017, and 2016, investor payable – common stock totaled $658,000, respectively.

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Preferred Stock Payable

On December 21, 2015, the Company recorded preferred stock payable of $13,438 for 13,437,500 Series B Preferred shares related to the acquisition of the assets of Net D (see Note 5). During the year ended January 31, 2017, the Company issued 13,437,500 Series B Preferred shares to settle this payable.

On October 30, 2014, the Company recorded $1,000,000 as preferred share payable which shall be converted to 1 Series C Preferred share for the acquisition of Webrunner. On April 9, 2015, the Company issued 1 Series C Preferred Share to settle this payable.

As of January 31, 2017 and 2016, preferred stock payable totaled $0 and $13,438, respectively.

NOTE 13 – EQUITY

Amendment to Articles of Incorporation or Bylaws

On April 10, 2016, the Company filed a Certificate of Amendment with the state of Nevada, to the Company’s Articles of Incorporation, to increase the number of authorized shares of capital stock to 15,000,000,000 shares. With 14,900,000,000 shares of common stock, par value $0.001 and 100,000,000 shares of preferred stock, par value $0.001.

Preferred Stock

Series A Preferred Stock

The Company is authorized to issue 1,000 shares of series A Preferred Stock at a par value of $0.001. The terms of the Certificate of Designation of the Series A Preferred Stock, include the right to vote in aggregate, on all shareholder matters equal to 51% of the total vote (“Super Majority Voting Rights”). The Series A Preferred Stock will be entitle to this 51% voting right no matter how many shares of common stock or other voting stock of the Company are issued or outstanding in the future.

As of January 31, 2017, and 2016, 1,000 shares of series A Preferred Stock were issued and outstanding, respectively.

Series B Convertible Preferred Stock

On March 11, 2016, the Company amended its Articles of Incorporation to increase the number of preferred shares designated Series B Convertible Shares (the “Series B”) from 50,000,000 to 95,000,000. Holders of the Series B Preferred shares shall be entitled to receive dividends or other distributions with the holders of the Company’s common shares on an “as converted” basis when, as, and if declared by the directors of the Company.

The Holders have the right to convert each Series B Preferred share, at any time after 6 months from the date of issuance, into fully paid and non-assessable common shares on the basis of 1 Series B Preferred share for 1.25 common shares (1:1.25).

During the year ended January 31, 2017, the Company issued Series B Preferred shares, as follows:

· On December 21, 2015, the Company recorded preferred stock payable of $13,438 for 13,437,500 Series B Preferred shares related to the acquisition of the assets of Net D. During the nine months ended October 31, 2016 the Company issued 13,437,500 Series B Preferred shares to settle this payable.

· On February 3, 2016, 4,750,000 shares were sold for cash of $20,000. On issuance, value of the underlining common stock represented a beneficial conversion feature of $23,344. The beneficial conversion feature will be recognized when the preferred stock becomes convertible on August 3, 2016 as a deemed dividend.

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During the year ended January 31, 2016, the Company issued Series B Preferred shares, as follows:

· 437,500 shares were sold for cash on June 22, 2015 for a total consideration of $17,500.

· 25,000,000 shares with fair value of $415,625 in connection with the acquisition of Net D’s assets (see Note 5). Of this amount, the par value of $13,438 related to the 13,437,500 shares in excess of the authorized shares at January 31, 2016 is reported as preferred stock payable in the consolidated balance sheets

· 5,000,000 shares with a fair value of $54,375 in connection with the acquisition of Connexum (see Note 5).

· 25,000,000 shares with a fair value of $415,625 as settlement of amounts due to the CEO totaling $438,854. As a result, the Company recorded a loss on settlement of liabilities of $2,976,771 (see also below).

· 8,000,000 shares were sold for cash in January 2016 for a total consideration of $30,000

As of January 31, 2017, and 2016, 68,187,500 and 50,000,000 shares of Series B Preferred Stock were issued and outstanding, respectively.

Series C Convertible Preferred Stock

The Series C Preferred Stock consists of 100 shares, at a par value of $0.001 per share, with certain rights, privileges, preferences and restrictions as set forth in Series C Preferred Stock Certificate of Designation. Holders of the Series C Preferred shares shall be entitled to receive dividends or other distributions with the holders of the Company’s common share on an “as converted” basis when, as and if, declared by the directors of the Company.

Each share of the Series C Preferred Stock shall be convertible, at the option of the holder thereof and subject to notice requirements at any time following 12 months from the issuance of such shares, into such number of fully paid and non-assessable common shares worth $1,000,000.

During the year ended January 31, 2017, the Company determined the Series C Convertible Preferred Stock is considered to be contingently redeemable convertible and as a result, has been classified as mezzanine equity in the Company's balance sheet, as of January 31, 2017 and 2016.

During the year ended January 31, 2017, the Company issued Series C Preferred shares, as follows:

· 1 share with a fair value of $1,000,000 as settlement of amounts due to the CEO totaling $271,200

· 1 share with a fair value of $1,000,000 as settlement of amounts due to the CFO totaling $164,000

As a result, the Company recorded a loss on settlement of debt of $1,564,800.

During the year ended January 31, 2016, the Company issued Series C Preferred shares, as follows:

· 1 share to settle the preferred stock payable of $1,000,000 recorded in connection with the acquisition of Webrunner

· 3 shares with a fair value of $3,000,000 in connection with the acquisition of Net D’s assets (see Note 5).

· 3 shares with a fair value of $3,000,000 as settlement of amounts due to the CEO totaling $438,854. As a result, the Company recorded a loss on settlement of debt of $2,976,771.

On April 11, 2014, the Company and Doyle Knudson entered into a Series C Preferred Stock Purchase Agreement dated as of April 10, 2014, pursuant to which the Company sold 7 Series C Preferred shares for an aggregate purchase price of $3,300,000.

As of January 31, 2017, and 2016, 16 and 14 shares of Series C Preferred Stock were issued and outstanding, respectively.

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Series D Convertible Preferred Stock

On June 23, 2016, pursuant to its Articles of Incorporation and Bylaws, the Board of Directors of the Company, unanimously approved the designation of a new series of preferred stock, "Series D Convertible Preferred Stock.

Each share of the Series D Preferred Stock shall be convertible, at the option of the holder thereof and subject to notice requirements at any time following 12 months from the issuance of such shares, into such number of fully paid and non-assessable common shares worth $100,000.

During the year ended January 31, 2017, the Company determined the Series D Convertible Preferred Stock is considered to be contingently redeemable convertible and as a result, has been classified as mezzanine equity in the Company's balance sheet, as of January 31, 2017 and 2016.

During year ended January 31, 2017, the Company issued Series D Preferred shares, as follows:

· 1 share with a fair value of $100,000 in connection with the acquisition of XTELUS (see Note 5).

· 20 shares with a fair value of $2,000,000 in connection with the acquisition of Connexum (See Note 5)

As of January 31, 2017 and 2016, 21 and 0 shares of Series D Preferred Stock were issued and outstanding, respectively.

Common stock

The Company is authorized to issue 14,900,000,000 shares of common stock at a par value of $0.001.

During the year ended January 31, 2017, the Company issued common shares, as follows:

· 2,054,226,375 common shares were issued for the conversion of debt and accrued interest of $615,528.

· 41,000,000 common shares in exchange for the exercise of options for no consideration

During the year ended January 31, 2016, the Company issued common shares, as follows:

· 2,700,000 common shares with a fair market value of $54,000 to James E McCrink Trust in accordance with a settlement agreement reached with the latter on January 19, 2015 in connection with a complaint filed on November 4, 2014.

· 21,000,000 shares with a fair value of $161,100 as compensation to board members and employees.

· 16,150,000 shares with a fair value of $134,960 as compensation to consultants.

· 4,587,156 shares with a fair value of $20,183 to settle a $40,000 payable. The Company recognized a gain on settlement of liabilities of $19,817.

· 1,545,000 shares with a fair value of $13,042 as deferred financing fees

· 4,960,000 shares in exchange for warrants for a total consideration of $496,000 (see Note 11).

· 5,000,000 shares with fair value of $66,500 in connection with the acquisition of Net D’s assets (see Note 5).

· 44,189,102 common shares were issued for the conversion of debt, accrued interest and associated fees of $121,958.

As of January 31, 2017, and 2016, 2,357,089,633 and 261,863,258 shares of common stock were issued and outstanding, respectively.

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Warrants and Options

Warrants

As of January 31, 2017, and 2016, there are no warrants outstanding.

Options

The Company has 9,100,000 options issued in connection with the acquisition of Webrunner.

During year ended January 31, 2017, the Company entered into three separate agreements with consultants to provide the Company with consulting services in exchange for options of 17,000,000, 5,000,000 and 17,000,000 with an exercise price of $0, respectively. The options can be exercised by the holder any time prior to June 30, August 31, and September 30, 2016. These options were tainted as a result of the convertible notes with variable conversion rates (see Note 7) and were accounted for as derivative instruments at the time of issuance. The fair value of the derivatives related to the options amounting to $177,000 was recorded as stock compensation expense during the year ended January 31, 2017, with a corresponding credit to derivative liability (see Note 11).

On October 21, 2015, the Company entered into two separate agreements with consultants to provide the Company with consulting services in exchange for common shares of 20,000,000 and 7,000,000, respectively. In November 2015, the Company amended these two agreements. As a result of the amendment, the Company issued 27,000,000 stock options with an exercise price of $0.005 per share instead of the common shares. The options can be exercised by the holder any time prior to December 1, 2016. These options were tainted as a result of the convertible notes with variable conversion rates (see Note 9) and were accounted for as derivative instruments at the time of issuance. The fair value of the options amounting to $340,200 was recorded as stock compensation expense during the year ended January 31, 2016, with a corresponding credit to derivative liability (see Note 11).

During the year ended January 31, 2017, 41,000,000 options were exercise and the corresponding derivative liability at the date of exercise of $159,000 was credited to additional paid in capital.

During the year ended January 31, 2017, 25,000,000 options were forfeited, as a result, the company recorded gain on change in fair value of derivative of $81,472.

The following table summarizes information relating to outstanding and exercisable stock options as of January 31, 2017:

	Options Outstanding
				Weighted Average
	Shares			Exercise Price

Outstanding, January 31, 2015		9,100,000		$	0.10
Granted		27,000,000		$	0.005
Exercised		-		$	-
Forfeited/canceled		-		$	-
Outstanding, January 31, 2016		36,100,000		$	0.03

Granted		39,000,000		$	-
Exercised		(41,000,000	)	$	(0.0009	)
Forfeited/canceled		(25,000,000	)	$	-
Outstanding, January 1, 2017		9,100,000		$	0.10

Options Outstanding						Options Exercisable
Number of Shares		Weighted Average Remaining Contractual life (in years)		Weighted Average Exercise Price		Number of Shares		Weighted Average Exercise Price
	9,100,000		2.75	$	0.10		9,100,000	$	0.10

The options have no intrinsic value at January 31, 2017.

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Employee Incentive Bonus Plan

On June 27, 2016, the Company entered into employee agreement with two employees that contain preferred share issuance incentive bonuses based on various sales targets for XTELUS, for the 12- month period ending June 27, 2017. The first award contains cash compensation of $10,000 per month and the ability to earn 500,000 shares of Series B preferred stock if XTELUS revenue of $1,000,000 is generated within 12 months. The second award contains cash compensation of $20,000 per month, 5 shares of Series D preferred stock earned on June 27, 2017 (with 1 share earned immediately upon revenue of $100,000 being generated within first six months) and the ability to earn up to 6,500,000 shares of Series B preferred stock based upon XTELUS revenue targets up to $1,000,000 over 12 months and up to an additional 3,000,000 shares of Series B preferred stock based upon XTELUS revenue targets up between $1,000,000 and greater than $7,000,000 over 12 months. The Company assessed the probability that the revenue targets will be met and determined that the target revenue will most likely meet $1,000,000 and based on the stock awards, estimated the fair value of 6,500,000 shares of Preferred B stock at $32,500, 5 shares of Preferred D stock at $500,000 and 500,000 shares of Preferred B stock at $2,500, respectively. For the year ended January 31, 2017, the Company recognized stock based compensation of $361,000 under these awards, with a corresponding credit to additional paid in capital.

NOTE 14 – COMMITMENTS AND CONTINGENCIES

Rent

The lease is related to Webrunner business and on October 30, 2016, the Company entered into the sale of Webrunner business (See Note 6).

Rent expense from discontinued operations for the years ended January 31, 2017 and 2016 was $112,229 and $77,633, respectively.

Licensing Agreement / Deposit

On June 11, 2014, we entered into a license and subscription agreement with Cloud Medical Doctor Software Corporation formerly National Scientific Corporation (NSCT) which changed it’s name to Cipher Loc Corporation and ticker symbol to (CLOK) ("Cloud") for $1,125,000. The agreement grants to us a non-exclusive encryption license agreement which entitles us to utilize Cloud's encryption software solution within the Customer's business. We purchased a 48 months encryption licensing agreement to incorporate into our existing web based software. The licensing agreement will protect members of our platform from hackers and other privacy intrusion vehicles. CipherLoc has various features that will further protect our members and end users of our web developed platform. As of January 31, 2016, the software has not been delivered to the Company and as such the cash paid for the encryption licensing agreement of $1,125,000 has been accounted as a deposit. During the year ended January 31, 2016, the Company wrote off 50% of the deposit amounting to $562,500 to impairment expense and during the year ended January 31, 2017, the Company wrote off the rest of 50% of the deposit amounting to $562,500 to impairment expense.

Contingency

StoneRidge

Gawk contracted Stoneridge Capital, LLC. (“Stoneridge”) for Finance and Business Development services within the entertainment and technology sector that applies to Company’s business model. Subsequent to signing these agreements Gawk pivoted the company’s focus from the streaming media market to the telecommunications sector at which point Stoneridge’s services were no longer needed nor had any services to that point been received by the Company. Pursuant to the agreement, Gawk agreed to pay Stoneridge $750,000 but feel this amount is not owing. As of January 31, 2017 and 2016, $750,000 and $250,000 was recorded in accounts payable, respectively.

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Windstream Holdings, Inc.

At the time of acquisition of Connexum, Windstream Holdings, Inc. ("Windstream"), a provider of voice and data network communications, and managed services, to businesses in the United States, claimed that Connexum owed them $600,000, which charges Connexum denies. In 2015, Connexum contracted with Windstream to purchase high cost long distance services. When receiving the initial invoices Connexum noticed the bill was not what was expected and issued a dispute for the incorrect charges and paid the non-disputed amount of just over $20,000. Then, without notice, Windstream turned off services. Shortly thereafter Windstream and Connexum disputed over high cost traffic. Windstream continued to bill Connexum for many months even after disconnecting its service, which ended up totaling nearly $580,000 of disputed fees. At the time of disconnection, there was approximately $20,000 in actual unpaid usage fees. It is unlikely that the Company would pay these fees. Windstream has not threatened litigation at this point and Connexum is actively working to settle the disputed amount.

On May 25, 2016, the Company reached a settlement with Windstream for $20,000, which the Company paid during the year ended January 31, 2017.

Tarpon Bay Partners LLC

John Boritz

NOTE 15 – INCOME TAXES

The benefit for income taxes from continued operations for the years ended January 31, 2017 and 2016 consist of the following:

	Year Ended
	January 31,
	2017			2016
Current:
Federal	$	-		$	-
State		-			-

Deferred:
Federal	$	871,182		$	531,744
State		230,607			140,756
		1,101,789			672,500
Valuation allowance		(1,101,789	)		(672,500	)
Provision benefit for income taxes, net	$	-		$	-

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The difference between income tax expense computed by applying the federal statutory corporate tax rate and actual income tax expense is as follows:

	January 31,
	2017			2016

Statutory federal income tax rate	(34%		)	(34%		)
State income taxes and other		9	%		9	%
Change in valuation allowance		34	%		34	%
Effective tax rate		-			-

Deferred income taxes result from temporary differences in the recognition of income and expenses for the financial reporting purposes and for tax purposes. The tax effect of these temporary differences representing deferred tax asset and liabilities result principally from the following:

	January 31,
	2017			2016

Net operating loss carryforward	$	4,517,999		$	3,416,210
Valuation allowance		(4,517,999	)		(3,416,210	)
Deferred income tax asset	$	-		$	-

Deferred income taxes result from temporary differences in the recognition of income and expenses for the financial reporting purposes and for tax purposes. The Company has a net operating loss carryforward of approximately $10,507,000 available to offset future taxable income through 2035. For income tax reporting purposes, the Company’s aggregate unused net operating losses are subject to limitations of Section 382 of the Internal Revenue Code, as amended. Under the Tax Reform Act of 1986, the benefits from net operating losses carried forward may be impaired or limited on certain circumstances. Events which may cause limitations in the amount of net operating losses that the Company may utilize in any one year include, but are not limited to, a cumulative ownership change of more than 50% over a three-year period. The consolidation of any limitations that may be imposed for future issuances of equity securities, including issuances with respect to acquisitions have not been determined. The Company has provided a valuation reserve against the full amount of the net operating loss benefit, because in the opinion of management based upon the earning history of the Company; it is more likely than not that the benefits will not be realized.

For the years ended January 31, 2017 and 2016, the difference between the amounts of income tax expense or benefit that would result from applying the statutory rates to pretax income to the reported income tax expense of $0 is the result of the net operating loss carryforward and the related valuation allowance.

The Company anticipates it will continue to record a valuation allowance against the losses of certain jurisdictions, primarily federal and state, until such time as it is able to determine it is “more-likely-than-not” the deferred tax asset will be realized. Such position is dependent on whether there will be sufficient future taxable income to realize such deferred tax assets. The Company’s effective tax rate may vary from period to period based on changes in estimated taxable income or loss by jurisdiction, changes to the valuation allowance, changes to federal, state or foreign tax laws, future expansion into areas with varying country, state, and local income tax rates, deductibility of certain costs and expenses by jurisdiction.

Tax returns for the years ended 2011 through 2017, are subject to examination.

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NOTE 16 – RELATED PARTY TRANSACTIONS

During the years ended January 31, 2017 and 2016, the CEO advanced the Company cash of $200, and $0, respectively.

During the years ended January 31, 2017, the Company paid a total of $218,500 consulting fees to Scrip2Screen, an entity owned by Scott Kettle.

On January 31, 2017, the Company issued 2 Series C Preferred shares with a fair value of $2,000,000 as settlement of amounts due to the CEO and CFO totaling $435,200. As a result, the Company recorded a loss on settlement of liabilities of $1,564,800. The Company leases executive housing for the CFO and rent expense of $44,000 was also settled by the issuance of this preferred stock.

On December 21, 2015, the Company issued 25,000,000 Series B Preferred shares with a fair value of $415,625 and 3 Series C Preferred shares with a fair value of $3,000,000 as settlement of amounts due to the CEO totaling $438,854. As a result, the Company recorded a loss on settlement of liabilities of $2,976,771.

As of January 31, 2017, and 2016, the amount owed to the CEO and CFO was $0 and $0, respectively.

As of January 31, 2017, and 2016, the Company has outstanding notes payable to Net D totaling to $773,599 and $1,257,250, respectively, in connection with the Company’s acquisition of Connexum and certain assets of Net D (see Note 8). The sole owner of Net D is a director the Company. Net D also performs certain services for the Company in connection with the latter’s Carrier Services business. During the year ended January 31, 2017 and 2016, the Company incurred total fees in connection with such services of $63,334 and $133,436, respectively. As of January 31, 2017, and 2016, the Company has an outstanding payable to Net D of $235,917 and $27,942, respectively.

NOTE 17 – SUBSEQUENT EVENTS

Subsequent to January 31, 2017 through September 28, 2017, the Company had the following transactions:

· Issued an aggregate of 3,985,956,874 common shares were issued for the conversion of debt, accrued interest and associated fees of $214,708.

· The Company assigned 11 notes with principal amounts and accrued interest totaling to $301,324 to one lender which resulted to the payment of settlement premiums amounting to $90,397.

· On March 30, 2017, the Company entered into a Settlement Agreement with the former directors and officers of Webrunners.

· On February 27, 2017, the Company entered into an equity financing agreement. The Company shall issue and sell to the Investor, and the Investor shall purchase from the Company, up to that number of Shares having an aggregate Purchase Price of $7,000,000.

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There were no disagreements related to accounting principles or practices, financial statement disclosure, internal controls or auditing scope or procedure during the two fiscal years and interim periods.

Item 9A. Controls and Procedures

Evaluation of Effectiveness of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on this evaluation, our Chief Executive Officer and Chief Financial Officer, as of January 31, 2017, concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are not effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act was recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure for the reasons noted below.

Management's Report on Internal Control Over Financial Reporting

Our management is also responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. Our company's internal control over financial reporting is designed 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.

Our internal control over financial reporting includes those policies and procedures that;

Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company; and

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and

That our receipts and expenditures are being made only in accordance with authorizations of our company's management and directors; and

Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

As of January 31, 2017, management conducted an evaluation of the effectiveness of internal control over financial reporting based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that our internal control over financial reporting for that period was not effective.

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Management has identified the following material weaknesses and is taking action to remedy and remove the weakness in its internal controls over financial reporting:

· Lack of an independent board of directors, including an independent financial expert. The current board of directors is evaluating expanding the board of directors to include additional independent directors. The current board is composed of three (3) members and may be expanded to as many as seven members under our company’s Articles of Incorporation and By-Laws.

· Lack of segregation of duties and adequate documentation of our internal controls.

· The inability of our company to prepare and file its financial statements timely due to its limited financial and personnel resources.

· Lack of multiple levels of review in our company’s financial reporting process.

Changes in internal control over financial reporting

There were no changes in our internal control over financial reporting identified by management’s evaluation pursuant to Rules 13a-15(d) or 15d-15(d) of the Exchange Act during the most recent fiscal quarter that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, misstatements, errors, and instances of fraud, if any, within our company have been or will be prevented or detected. These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management or Board override of the control.

The design of any system of controls also is based in part upon 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; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

This annual report does not include a standard internal control report by our company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our company’s registered public accounting firm pursuant to current rules of the SEC that permit our company, as a smaller reporting company, to provide only management’s report in this annual report.

Item 9B. Other Information

None.

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PART III

Item 10. Directors, Executive Officers and Corporate Governance

All directors of our company hold office until the next annual meeting of the security holders 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. Our directors and executive officers, their ages, positions held, and duration as such, are as follows:

Name
Position Held
with the Company

Age

Date First Elected

or Appointed

Scott Kettle

Chief Executive Officer, President,

Chief Information Officer,

Chairman and Director

49

July 31, 2013

Chris Hall

Chief Financial Officer and Director

60

May 13, 2014

Michael Selsman

Secretary and Director

80

May 13, 2014

Vincent Cuzzo

Director

59

July 5, 2016

Business Experience

The following is a brief account of the education and business experience during at least the past five years of each director, executive officer and key employee of our company, indicating the person’s principal occupation during that period, and the name and principal business of the organization in which such occupation and employment were carried out.

Scott Kettle – Chief Executive Officer, Chief Information Officer, Chairman, President and Director

Mr. Kettle, is the founder of a series of successful family-owned and operated public companies in the telephony and telecommunications industry in the wake of the government-mandated break-up of AT&T’s monopoly some 25 years ago. Beginning with Thrifty-Tel (TTEL) in partnership with his father William Kettle, a steeply discounted provider of long-distance telephone service and pioneer of Flat Rate Communications, Kettle moved on to the wholesale sector serving as CIO for Five Star Telecom from 1994 to 1999. In 1998, Mr. Kettle founded and served as President and CEO of Tele Com Specialists, Inc. a software company. Kettle moved into the emerging DSL area, founding SpeeDsl, Inc.

Mr. Kettle’s extensive public company experience and more than twenty-five years of executive management give him the qualifications and skills to serve as a senior executive for the Gawk team

Chris Hall – Chief Financial Officer and Director

Chris Hall is a noted VoIP Networking Leader. Chris has been designing, deploying and operating VOIP networks since 1998 and has been in telecommunications since his initial four year entry to the industry with AT&T (Pacific Telephone) beginning in 1978. He has been a serial entrepreneur for the last twenty years, starting up or advancing many telecom companies to the point where they could be sold to larger (often public) firms.

Global deregulation of telecoms and the development of VOIP technology combined to give Chris the opportunity to apply his USC undergraduate degree in International Relations and his UCLA M.B.A. in Finance to start building wholesale international simple resale (ISR) routes in 1998, he built and operated routes under FCC Section 214 license to every region of the world - a total of 15 countries, including: Costa Rica, Jamaica, Mexico, Vietnam, China, Thailand, Philippines, Japan, India, Bangladesh, Egypt, Ghana, Netherlands, the United Kingdom and most recently Panama, Uruguay and Argentina. In most cases, he visited each of these countries personally (more than once), and became familiar with the local business practices and import/export requirements. He returned with more than just "routes" and extra passport pages as he collected children’s dolls, in native costume, from each country for his youngest daughter - giving her the best doll collection in the neighborhood.

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During this time Chris became operationally qualified on Cisco, Excel and Nuera equipment, building on top of his degree in Data Communications Engineering, as well as mastering telecom billing applications software and advanced database programs (like MS Sequel). With a staff of three people, he did most of the operational work, and sub-contracted out as required. Chris also did much of the sales, and is well known amongst the international wholesale community.

The proliferation of Competitive Local Exchange Carriers (CLEC's) made possible by the 1996 Telecom Act, the declining cost of VOIP equipment and the availability of next generation Session Border Controllers (SBC's) like Nextone and Sansay gave Chris a new challenge and opportunity in 2003 - to apply his VOIP expertise to the domestic (USA) market, this time building on his AT&T experience. This meant less travel and more stability. He built a profitable 30 million minute per month carrier with a capital investment of less than $350,000, annualized revenue reached over $3.5M from scratch in a short two year period, while still preserving his operational & sales involvement. Chris is operationally well qualified on OpenSIPS, Nextone and Sansay Session Border Controllers (aka Softswitches) and is well known to most major and minor wholesale carriers in the USA and many abroad.

Chris is a recognized VOIP industry leader, he has spoken at several trade shows and conferences such as Comptel, VON and Intelecard, and is a member of several industry associations, including Comptel, the Pacific Telecommunications Council and the West Coast Carrier Forum.

Michael Selsman – Secretary and Director

Michael Selsman has been an executive with 20th Century-Fox, Paramount, MGM, Samuel Goldwyn, Jr., at Goldwyn Studios, and Universal. He was also a talent agent, representing Judy Garland, Marilyn Monroe, Peter Sellers, Marlene Dietrich, Henry, Jane, and Peter Fonda, Mervyn LeRoy, James Stewart, Lawrence Harvey, Rock Hudson, James Mason, James Garner, Alan Arkin, and Robert Redford, as well as authors Truman Capote and Roald Dahl, among others. He also worked with Bing Crosby Productions on "Ben Casey", "Medic", "Slattery's People" and "Hogan's Heroes".

As a film producer, he associate-produced “Gotcha,” distributed by Universal, co-developed 18 motion picture projects at MGM, facilitated production of the feature film "Dirty Little Billy,” for Columbia Pictures, and was involved in developing "Bury My Heart at Wounded Knee," by Dee Brown, 'World Without End, Amen," by Jimmy Breslin, "I, Robot," by Issac Asimov, “RFK Must Die,” and "The Fortunate Pilgrim," by Mario Puzo. He also co- or line-produced films made in Berlin, Spain, Arizona, Florida, Montana, Wyoming, Texas and Arkansas. With Orson Welles, he developed “RFK Must Die,” a film project about the assassination of Robert Kennedy. He has written screenplays for Hemdale Pictures, MGM, Robert Halmi Production, New World Pictures, and others.

He is considered an expert source on international entertainment and has been quoted in such publications as Time, Newsweek, TV Guide, and in various newspapers and books on the subjects of contracts and changing mores and social values in the media and commenting on Hollywood studio history,. He has also appeared on national and international television programs, such as ABC-TV’s “The Dark Side of Camelot,” hosted by the late Peter Jennings, “Current Affair,” on Fox-TV, “Hard Copy,” for CBS-TV, “Marilyn: Contre-Enquette Sur Une Mort Suspect,” one-hour investigative program for French TV, “The Final Day,” one-hour investigative program for London’s Channel 4, and, most recently, filmed a segment for CBS News’ “48 Hours.”

He also served US Senator Dianne Feinstein as Deputy State Finance Director for her initial Senatorial campaign. He was recently in an advisory capacity for Marianne Williamson in her campaign for the 33^rd Congressional District, and is advising Heidi Shink in her campaign for City Council, West Hollywood.

Serving for five years as Chairman of the Public Relations Committee and on the Foundation Board of Directors of St. Vincent Medical Center, Los Angeles, Selsman created and edited a quarterly, leading-edge journal, Medical-Science News.

Selsman has represented and worked with Neah Power Systems (NPWZ), where he was also a member of the Board of Directors; Buzz Technologies, Inc. (BZTG), Archer Entertainment Media Communications, Inc. (AEMC), where he also functioned as CEO; Advanced Technetix (AKYI), The Sinclair Private Fund, Signal Capital Hedge Fund, Applied DNA Sciences, Inc. (APDN), Herman Miller Workplace Resource, Inc., BKM Total Office, Investprivate.com, Alpha Spacecom, Inc. (ASPC) Creditz, Inc. (CEOA), Innovative Marketing, Inc. (INOV), Advanced Recycling (ARYC), Color Imaging, Inc.(CIMG), Electropure (ELTP), XO Communications (XOXO), Gene Cell (GCLL), Precom Technology (PMMT), Cyper Media (CYPR), Los Angeles Stars ABA franchise, Travel Dynamics (TDMN), Brilliant Digital Entertainment, Koo Koo Roo, American Technology Group, Texas Capital, Securities America, Newport West Financial, 20th Century-Fox, MGM, Donald T. Sterling Corporation, Los Angeles Clippers NBA franchise, and Fred Sands Realtors, among others.

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He has guest-lectured at schools and universities such as UCLA, USC, Pepperdine, Westlake, Mount St. Mary's and Loyola, and has been quoted in Time, Newsweek, TV Guide and various books and newspapers, on contracts and changing social mores and values in the media. He has also appeared on national and European network television programs commenting on Hollywood studio history.

Vincent Cuzzo –Director

Mr. Cuzzo founded the CLP Group, LLC in 1997. He is a Certified Public Accountant by trade and has worked in both the public and private sector. Prior to starting the Company, Mr. Cuzzo was a Chief Financial Officer for a publicly traded equipment leasing company during which time he was a member of the Accounting Standards Board of Directors for the Computer Dealers and Lessors' Association (CDLA). His private industry experience also includes senior management positions in the Media, Graphic Arts and Telecommunications industries.

Family Relationships

There are no family relationships between any of our directors, executive officers and proposed directors or executive officers.

Involvement in Certain Legal Proceedings

To the best of our knowledge, none of our directors or executive officers has, during the past ten years:

1. been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offences);

2. had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time;

3. been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity;

4. been found by a court of competent jurisdiction in a civil action or by the SEC 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;

5. been the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

6. been the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26)), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29)), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

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

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers and directors and persons who own more than 10% of a registered class of our equity securities to file with the SEC initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of our shares of 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 they file.

To date, our former and current executive officers, directors and persons who own more than 10% of a registered class of our equity securities have not met the filing requirements applicable to them. Our current management and directors need to file Form 3 and /or Form 5 for the issuance of common shares.

Code of Ethics

We have not adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller. We only have two officer’s and four directors and do not believe we need a code of ethics at this time.

Committees of the Board

Our company currently does not have nominating, compensation or audit committees or committees performing similar functions nor does our company have a written nominating, compensation or audit committee charter. Our directors believe that it is not necessary to have such committees, at this time, because the functions of such committees can be adequately performed by the board of directors.

Our company does not have any defined policy or procedural requirements for shareholders to submit recommendations or nominations for directors. The board of directors believes that, given the stage of our development, a specific nominating policy would be premature and of little assistance until our business operations develop to a more advanced level. Our company does not currently have any specific or minimum criteria for the election of nominees to the board of directors and we do not have any specific process or procedure for evaluating such nominees. The board of directors will assess all candidates, whether submitted by management or shareholders, and make recommendations for election or appointment.

A shareholder who wishes to communicate with our board of directors may do so by directing a written request addressed to our President at the address appearing on the first page of this annual report.

Board and Committee Meetings

Our board of directors held no formal meetings during the year ended January 31, 2017. All proceedings of the board of directors were conducted by resolutions consented to in writing by all the directors and filed with the minutes of the proceedings of the directors. Such resolutions consented to in writing by the directors entitled to vote on that resolution at a meeting of the directors are, according to the Nevada General Corporate Law and our Bylaws, as valid and effective as if they had been passed at a meeting of the directors duly called and held.

Audit Committee Financial Expert

Currently our audit committee consists of our entire board of directors. We do not currently have a director who is qualified to act as the head of the audit committee.

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Item 11. Executive Compensation

The particulars of the compensation paid to the following persons:

(a) our principal executive officer;

(b) each of our two most highly compensated executive officers who were serving as executive officers at the end of the years ended January 31, 2017 and 2016; and

(c) up to two additional individuals for whom disclosure would have been provided under (b) but for the fact that the individual was not serving as our executive officer at the end of the years ended January 31, 2017 and 2016, who we will collectively refer to as the named executive officers of our company, are set out in the following summary compensation table, except that no disclosure is provided for any named executive officer, other than our principal executive officers, whose total compensation did not exceed $100,000 for the respective fiscal year:

SUMMARY COMPENSATION TABLE

Name and Principal Position

Year

Salary

($)

Bonus

($)

Stock Awards

($)

Option Awards

($)

Non-Equity Incentive Plan Compensa-tion

($)

Change in Pension
Value and Nonqualified Deferred Compensa-tion Earnings
($)
All
Other Compensa-tion

($)

Total

($)

Scott Kettle President, CEO, Treasurer and Director

2017
2016

121,000
121,859

150,000
150,000

Nil
35,100

Nil
Nil

Nil
Nil

Nil
Nil

Nil
Nil

271,000
306,959

Chris Hall CFO and Director

2017
2016

14,000
Nil

150,000
Nil

Nil
35,100

Nil
Nil

Nil
Nil

Nil
Nil

Nil
Nil

164,000
35,100

Michael Selsman Secretary and Director

2017
2016

Nil
Nil

Nil
Nil

Nil
35,100

Nil
Nil

Nil
Nil

Nil
Nil

Nil
Nil

Nil
35,100

Grants of Plan-Based Awards

During the fiscal year ended January 31, 2017 we did not grant any stock options.

Option Exercises and Stock Vested

During our fiscal year ended January 31, 2017 there were no options exercised by our named officers.

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Compensation of Directors

Our current compensation policy for directors is to compensate them through options to purchase common stock or through common stock as consideration for their joining our board and/or providing continued services as a director. We do not currently provide our directors with cash compensation, although we do reimburse their expenses, with exception for a chairman of the board. No additional amounts are payable to our company’s directors for committee participation or special assignments. There are no other arrangements pursuant to which any directors was compensated during our company’s last completed fiscal year for any service provided except as follows:

On August 20, 2013 our company entered into an employment agreement with Scott Kettle the Chief Executive Officer and Christopher G. Hall. The Fixed Annual Compensation. Our company shall pay to Employee salary ("Fixed Annual Compensation") at the rate of $360,000 per annum beginning on December 21, 2016; at the rate of $420,000 per annum beginning on December 21, 2017; and at the rate of $480,000 per annum beginning on December 21, 2018. Fixed Annual Compensation is payable to the Employee in accordance with our company’s usual salary practices, but in no event less than once monthly.

The Agreement allows for Bonus of the highest bonus incentive program (hereafter “BIP”) set up by the Board. While the specific structure and trigger mechanisms for the BIP are at the sole discretion of the Board, the BIP shall afford Employee the opportunity to earn a minimum of $150,000 per year in cash bonuses through the Employee’s accomplishment of specific pre-identified reasonable milestones in the development of our company’s business, or by exceeding the approved business plan revenue and income levels. Any payments under the BIP shall be paid annually to Employee and shall be paid no later than the end of the first quarter following our company’s fiscal year-end. In addition to the BIP, Employee shall also be entitled to such additional bonus, if any, as may be granted by the Board (with Employee abstaining from any vote thereon) or compensation or similar committee thereof in the Board's (or such committee's) sole discretion based upon employee's performance of his Services under this Agreement.

Additional Compensation. The Employee shall be entitled to receive an annual bonus no less than Two Percent (2%) of Adjusted Gross Sales. For the purpose of this Agreement, Adjusted “Adjusted Gross Sales” shall mean Gross Sales minus all fixed costs. Further, the Employee shall be entitled to receive such additional bonus payments or incentive compensation as may be determined at any time or from time to time by the Board of Directors of our company (or any authorized committee thereof) in its discretion, but no less than once every quarter.

Asset Sale or Merger. In the event of a sale of all of the assets or a merger in which our company is not the surviving entity and in which our company is valued at $50,000,000 or more, Employee will be entitled to the greater of 5 of the gross proceeds of the value of the transaction or $2,500,000 in cash to be paid upon the transaction’s closing.

The Agreement allows for standard vacation, health, participation in employee benefit plan among other things.

We do not have any agreements for compensating our directors for their services in their capacity as directors, although such directors are expected in the future to receive stock options to purchase shares of our common stock as awarded by our board of directors.

Pension, Retirement or Similar Benefit Plans

There are no arrangements or plans in which we provide 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, except that stock options may be granted at the discretion of the board of directors or a committee thereof.

Indebtedness of Directors, Senior Officers, Executive Officers and Other Management

None of our directors or executive officers or any associate or affiliate of our company during the last two fiscal years, is or has been indebted to our company by way of guarantee, support agreement, letter of credit or other similar agreement or understanding currently outstanding.

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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The following table sets forth, as of October 20, 2017, certain information with respect to the beneficial ownership of our common and preferred shares by each shareholder known by us to be the beneficial owner of more than 5% of our common and preferred shares, as well as by each of our current directors and executive officers as a group. Each person has sole voting and investment power with respect to the shares of common and preferred stock, except as otherwise indicated. Beneficial ownership consists of a direct interest in the shares of common and preferred stock, except as otherwise indicated.

Name and Address of Beneficial Owner

Title of Class

Amount and Nature of

Beneficial Ownership⁽¹⁾

Percentage

of Class

Scott Kettle

c/o Gawk

5300 Melrose Avenue, Suite 42

Los Angeles, CA 90038

Common Stock

Series A Preferred Stock⁽²⁾

Series B Preferred Stock⁽³⁾Series C Preferred Stock⁽⁴⁾

83,000,000

500

25,000,000

4

1.309%

50%

36.66%

25%

Chris Hall

c/o Gawk

5300 Melrose Avenue, Suite 42

Los Angeles, CA 90038

Common Stock

Series A Preferred Stock⁽²⁾

Series B Preferred Stock⁽³⁾

Series C Preferred Stock⁽⁴⁾

8,000,000

500

25,000,000

4

0.126%

50%

36.66%

25%

Michael Selsman

c/o Gawk

5300 Melrose Avenue, Suite 42

Los Angeles, CA 90038

Common Stock

3,000,000

0.047%

Vincent Cuzzo

c/o Gawk

5300 Melrose Avenue, Suite 42

Los Angeles, CA 90038

Common Stock

Series A Preferred Stock⁽²⁾

Series B Preferred Stock⁽³⁾Series C Preferred Stock⁽⁴⁾

-

-

-

-

-

-

-

-

Directors and Executive Officers as a Group

94,000,000 Common

1,000 Series A Preferred Stock

25,000,000 Series B Preferred Stock

8 Series C Preferred Stock

1.482%

100%

45.118%

43.750%

7TCNW General Partnership

26475 Rancho Parkway South

Lake Forest CA 92630

Series B Preferred Stock⁽³⁾

5,000,000

7.333%

Doyle Knudson

8923 N. Martingale Rd

Paradise Valley AZ 85253-2052

Series C Preferred Stock⁽⁴⁾

7

43.750%

________

(1) Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of common stock actually outstanding on October 20, 2017. As of October 20, 2017 there were 6,342,546,507 shares of our company’s common stock issued and outstanding.

(2) As at October 20, 2017 there were 1,000 shares of Series A Preferred stock issued and outstanding.

(3) As at October 20, 2017 there were 68,187,500 shares of Series B Preferred stock issued and outstanding.

(4) As at October 20, 2017 there were 16 shares of Series C Preferred stock issued and outstanding.

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Changes in Control

We are unaware of any contract or other arrangement or provisions of our Articles or Bylaws the operation of which may at a subsequent date result in a change of control of our company. There are not any provisions in our Articles or Bylaws, the operation of which would delay, defer, or prevent a change in control of our company.

Item 13. Certain Relationships and Related Transactions, and Director Independence

Except as disclosed herein, no director, executive officer, shareholder holding at least 5% of shares of our common stock, or any family member thereof, had any material interest, direct or indirect, in any transaction, or proposed transaction since the year ended January 31, 2017, in which the amount involved in the transaction exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at the year-end for the last three completed fiscal years.

Director Independence

We currently act with four directors, Scott Kettle, Chris Hall, Michael Selsman and Vincent Cuzzo.

We have determined that Vincent Cuzzo is an independent director, as that term is used in Rule 4200(a)(15) of the Rules of National Association of Securities Dealers.

Currently our audit committee consists of Vincent Cuzzo and Scott Kettle who also serve on the board of directors. We currently do not have nominating, compensation committees or committees performing similar functions. There has not been any defined policy or procedure requirements for shareholders to submit recommendations or nomination for directors.

From inception to present date, we believe that the members of our audit committee and the board of directors have been and are collectively capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting.

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Item 14. Principal Accounting Fees and Services

The aggregate fees billed for the most recently completed fiscal year ended January 31, 2017 and for fiscal year ended January 31, 2016 for professional services rendered by the principal accountant for the audit of our annual financial statements and review of the financial statements included in our quarterly reports on Form 10-Q and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:

Year Ended

January 31,

2017

January 31,

2016

Audit Fees

$ 39,000

$ 36,000

Audit Related Fees

Nil

Nil

Tax Fees

Nil

Nil

All Other Fees

Nil

Nil

Total

$ 39,000

$ 36,000

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

Our board of directors has considered the nature and amount of fees billed by our independent auditors and believes that the provision of services for activities unrelated to the audit is compatible with maintaining our independent auditors’ independence.

29

Table of Contents

PART IV

Item 15. Exhibits, Financial Statement Schedules

(a) Financial Statements

(1) Financial statements for our company are listed in the index under Item 8 of this document.

(2) All financial statement schedules are omitted because they are not applicable, not material or the required information is shown in the financial statements or notes thereto.

(b) Exhibits

Exhibit

Number

Description

(31)

Rule 13a-14 (d)/15d-14d) Certifications

31.1*

Section 302 Certification by the Principal Executive Officer

31.2*

Section 302 Certification by the Principal Financial Officer and Principal Accounting Officer

(32)

Section 1350 Certifications

32.1**

Section 906 Certification by the Principal Executive Officer

32.2**

Section 906 Certification by the Principal Financial Officer and Principal Accounting Officer

101**

Interactive Data File

101.INS

XBRL Instance Document

101.SCH

XBRL Taxonomy Extension Schema Document

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

XBRL Taxonomy Extension Label Linkbase Document

101.PRE

XBRL Taxonomy Extension Presentation Linkbase Document

______

* Filed herewith.

** Furnished herewith

30

Table of Contents

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, thereto duly authorized.

GAWK INCORPORATED

(Registrant)

Dated: October 23, 2017

/s/ Scott Kettle

Scott Kettle

Chief Executive Officer, President, Chief Information Officer and Director

(Principal Executive Officer)

Dated: October 23, 2017

/s/ Chris Hall

Chris Hall

Chief Financial Officer and Director

(Principal Financial Officer and Principal Accounting Officer)

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.

Dated: October 23, 2017

/s/ Scott Kettle

Scott Kettle

Chief Executive Officer, President, Chief Information Officer and Director

(Principal Executive Officer)

Dated: October 23, 2017

/s/ Chris Hall

Chris Hall

Chief Financial Officer and Director

(Principal Financial Officer and Principal Accounting Officer)

Dated: October 23, 2017

/s/ Michael Selsman

Michael Selsman

Secretary and Director

Dated: October 23, 2017

/s/ Vincent Cuzzo

Vincent Cuzzo

Director

EX-31.1 2 gawk_ex311.htm CERTIFICATION gawk_ex311.htm

EXHIBIT 31.1

CERTIFICATION PURSUANT TO

18 U.S.C. ss 1350, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Scott Kettle, certify that:

1. I have reviewed this annual report on Form 10-K of Gawk Incorporated;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: October 23, 2017

/s/ Scott Kettle

Scott Kettle

Chief Executive Officer, President, Chief Information Officer and Director

(Principal Executive Officer)

EX-31.2 3 gawk_ex312.htm CERTIFICATION gawk_ex312.htm

EXHIBIT 31.2

CERTIFICATION PURSUANT TO

18 U.S.C. ss 1350, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Chris Hall, certify that:

Date: October 23, 2017

/s/ Chris Hall

Chris Hall

Chief Financial Officer and Director

(Principal Financial Officer and Principal Accounting Officer)

EX-32.1 4 gawk_ex321.htm CERTIFICATION gawk_ex321.htm

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Scott Kettle, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Annual Report on Form 10-K of Gawk Incorporated for the period ended January 31, 2017 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Gawk Incorporated

Dated: October 23, 2017

/s/ Scott Kettle

Scott Kettle

Chief Executive Officer, President, Chief Information Officer and Director

(Principal Executive Officer)

Gawk Incorporated

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Gawk Incorporated and will be retained by Gawk Incorporated and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2 5 gawk_ex322.htm CERTIFICATION gawk_ex322.htm

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Chris Hall, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

Dated: October 23, 2017

/s/ Chris Hall

Chris Hall

Chief Financial Officer and Director

(Principal Financial Officer and Principal Accounting Officer)

Gawk Incorporated

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<p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America. Significant accounting policies are as follows: <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Use of Estimates and Assumptions <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0.5in; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and (iii) the reported amount of net revenues and expenses recognized during the periods presented. Adjustments made with respect to the use of estimates often relate to improved information not previously available. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of financial statements; accordingly, actual results could differ from these estimates. The Company’s most significant estimates relate to the valuation of its intangible assets, goodwill impairment, derivative liabilities, and the valuation of its common stock. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0.5in; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Principles of Consolidation <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0.5in; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. We currently have no investments accounted for using the equity or cost methods of accounting. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Reclassifications <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Certain prior year amounts have been reclassified to conform with the current year presentation. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Cash and Cash Equivalents <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0.5in; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. At January 31, 2017 and 2016, cash and cash equivalents include cash on hand and cash in the bank. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Goodwill and Other Intangible Assets <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">We account for goodwill and intangible assets in accordance with ASC 350 "Intangibles-Goodwill and Other" ("ASC 350"). ASC 350 requires that goodwill and other intangibles with indefinite lives be tested for impairment annually or on an interim basis if events or circumstances indicate that the fair value of an asset has decreased below its carrying value. In addition, ASC 350 requires that goodwill be tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests when circumstances indicate that the recoverability of the carrying amount of goodwill may be in doubt. Application of the goodwill impairment test requires judgment, including the identification of reporting units; assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value. Significant judgments required to estimate the fair value of reporting units include estimating future cash flows, determining appropriate discount rates and other assumptions. Changes in these estimates and assumptions or the occurrence of one or more confirming events in future periods could cause the actual results or outcomes to materially differ from such estimates and could also affect the determination of fair value and/or goodwill impairment at future reporting dates. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0.5in; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">We completed an evaluation of intangible assets and goodwill at January 31, 2017 and 2016, and recognized an impairment loss of $3,807,207 and $1,200,003 during the year ended January 31, 2017 and 2016. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The cost of intangible assets with determinable useful lives is amortized to reflect the pattern of economic benefits consumed, either on a straight-line or accelerated basis over the estimated periods benefited. Patents, technology and other intangibles with contractual terms are generally amortized over their respective legal or contractual lives. Customer relationships, brands and other non-contractual intangible assets with determinable lives are amortized over periods 3 years. When certain events or changes in operating conditions occur, an impairment assessment is performed and lives of intangible assets with determinable lives may be adjusted. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Long-Lived Assets <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Long-lived assets are evaluated for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test is based on a comparison of the undiscounted future cash flows to the recorded value of the asset. If impairment is indicated, the asset is written down to its estimated fair value. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Property and Equipment <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Property and equipment, consisting mostly of computer equipment, is recorded at cost reduced by accumulated depreciation. Depreciation expense is recognized over the assets’ estimated useful lives of three years using the straight-line method. Major additions and improvements are capitalized as additions to the property and equipment accounts, while replacements, maintenance and repairs that do not improve or extend the life of the respective assets, are expensed as incurred. Estimated useful lives are periodically reviewed and, when appropriate, changes are made prospectively. When certain events or changes in operating conditions occur, asset lives may be adjusted and an impairment assessment may be performed on the recoverability of the carrying amounts. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Accounts Receivable and Allowance for Uncollectible Accounts <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0.5in; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Substantially all of the Company’s accounts receivable balance is related to trade receivables. Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments for services. Accounts with known financial issues are first reviewed and specific estimates are recorded. The remaining accounts receivable balances are then grouped in categories by the number of days the balance is past due, and the estimated loss is calculated as a percentage of the total category based upon past history. Account balances are charged against the allowance when it is probable that the receivable will not be recovered. As of January 31, 2017 and 2016, the Company had a valuation allowance for doubtful accounts of $18,876 and $0, respectively, for the Company’s accounts receivable. During the years ended January 31, 2017 and 2016, the Company recorded bad debt expense for uncollectible amounts of $18,876 and $11,782, respectively. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Marketable securities and other investments <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">We adopted ASC 825, “The Fair Value Option for Financial Assets and Financial Liabilities. Under this statement, an entity may elect to use fair value to measure eligible items. The adoption of this statement did not have an impact on our results of operations or financial condition. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">We classify these investments as current assets and carry them at fair value. We recognize all unrealized and realized gains and losses on our available-for-sale securities in other income in the accompanying consolidated statements of operations and comprehensive income (loss). <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Revenue Recognition <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company pursues opportunities to realize revenues from consulting services. It is the company’s policy that revenues and gains will be recognized in accordance with ASC Topic 605-10-25, “Revenue Recognition.” Under ASC Topic 605-10-25, revenue earning activities are recognized when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Our Business Services revenue includes monthly recurring charges (“MRC”) to customers, for whom charges are contracted over a specified period of time, and variable usage fees charged to customers that purchase our business products and services. Revenue recognition commences after the provisioning, testing and acceptance of the service by the customer. MRCs continue until the expiration of the contract, or until cancellation of the service by the customer. To the extent that payments received from a customer are related to a future period, the payment is recorded as deferred revenue until the service is provided or the usage occurs. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Our Carrier Services revenue is primarily derived from usage fees charged to other carriers that terminate voice traffic over our network. Variable revenue is earned based on the length of a call, as measured by the number of minutes of duration. It is recognized upon completion of the call, and is adjusted to reflect the allowance for billing adjustments. Revenue for each customer is calculated from information received through our network switches. Our customized software tracks the information from the switches and analyzes the call detail records against stored detailed information about revenue rates. This software provides us with the ability to complete a timely and accurate analysis of revenue earned in a period. We believe that the nature of this process is such that recorded revenues are unlikely to be revised in future periods. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Income Taxes <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0.5in; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company utilizes the asset and liability method in accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for operating loss and tax credit carry-forwards and for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year 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 results of operations in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying amounts of deferred tax assets unless it is more likely than not that the value of such assets will be realized. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company uses the two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not, that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. The Company considers many factors when evaluating and estimating the Company's tax positions and tax benefits, which may require periodic adjustments. At January 31, 2017 and 2016, the Company did not record any liabilities for uncertain tax positions. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Research and Development and Software Development Costs <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Capitalization of certain software development costs are recorded after the determination of technological feasibility. Based on our product development process, technological feasibility is determined upon the completion of a working model. To date, costs incurred by us from the completion of the working model to the point at which the product is ready for general release have been insignificant. Accordingly, we have charged all such costs to research and development expense in the period incurred. Our research and development costs for the years ended January 31, 2017 and 2016 were $0 and $2,500, respectively. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Share-Based Compensation <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company measures the cost of services received in exchange for an award of an equity instrument based on the grant-date fair value of the award. Employee awards are accounted for under ASC 718 - where the awards are valued at grant date. Awards given to nonemployees are accounted for under ASC 505 where the awards are valued at earlier of commitment date or completion of services. Compensation cost for employee awards is recognized over the vesting or requisite service period. The Black-Scholes option-pricing model is used to estimate the fair value of options or warrants granted. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Related Parties <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company follows ASC 850, "Related Party Disclosures," for the identification of related parties and disclosure of related party transactions. See note 16. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Basic and Diluted Net Loss per Common Share <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Basic income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. The weighted average number of shares is calculated by taking the number of shares outstanding and weighting them by the amount of time that they were outstanding. Diluted earnings per share reflects the potential dilution that could occur if stock options, warrants, and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. For the year ended January 31, 2017 and 2016, respectively, the following options, warrants, convertible notes and Series A convertible preferred stock were excluded from the computation of diluted net loss per shares as the result of the computation was anti-dilutive. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Diluted loss per share is the same as basic loss per share during periods where net losses are incurred since the inclusion of the potential common stock equivalents would be anti-dilutive as a result of the net loss. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Concentration of Credit Risk <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">All of the Company’s cash and cash equivalents are maintained in regional and national financial institutions. The Company has exposure to credit risk to the extent that its cash and cash equivalents exceed amounts covered by the U.S. federal deposit insurance; however, the Company has not experienced any losses in such accounts. In management’s opinion, the capitalization and operating history of the financial institutions are such that the likelihood of material loss is remote. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Derivative Financial Instruments <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The fair value of an embedded conversion option that is convertible into a variable amount of shares and warrants that include price protection reset provision features are deemed to be “down-round protection” and, therefore, do not meet the scope exception for treatment as a derivative under ASC 815 “Derivatives and Hedging”, since “down-round protection” is not an input into the calculation of the fair value of the conversion option and warrants and cannot be considered “indexed to the Company’s own stock” which is a requirement for the scope exception as outlined under ASC 815. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The accounting treatment of derivative financial instruments requires that the Company record the embedded conversion option and warrants at their fair values as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. The Company reassesses the classification of its derivative instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Black-Scholes option valuation model was used to estimate the fair value of the embedded conversion options and warrants. The model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time, of our common stock, equal to the weighted average life of the options. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Conversion options are recorded as debt discount and are amortized as interest expense over the life of the underlying debt instrument. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Fair Value of Financial Instruments <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company's financial instruments consist primarily of cash, accounts payable and accrued expenses, and debt. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company adopted ASC Topic 820, Fair Value Measurements (“ASC Topic 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The standard provides a consistent definition of fair value which focuses on an exit price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard also prioritizes, within the measurement of fair value, the use of market-based information over entity specific information and establishes a three-level hierarchy for fair value measurements based on the nature of inputs used in the valuation of an asset or liability as of the measurement date. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The three-level hierarchy for fair value measurements is defined as follows: <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0.5in; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;"> <table style="font: 10pt/normal 'times new roman'; width: 100%; text-align: justify; font-size-adjust: none; font-stretch: normal;" border="0" cellspacing="0" cellpadding="0"> <tr> <td width="4%">   </td> <td valign="top" width="4%">·</td> <td valign="top">Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; liabilities in active markets;</td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> </tr> <tr> <td>   </td> <td valign="top">·</td> <td valign="top">Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability other than quoted prices, either directly or indirectly, including inputs in markets that are not considered to be active; or directly or indirectly including inputs in markets that are not considered to be active;</td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> </tr> <tr> <td>   </td> <td valign="top">·</td> <td valign="top">Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement</td> </tr> </table>   <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The following table summarizes fair value measurements by level at January 31, 2017 and January 31, 2016 for assets measured at fair value on a recurring basis: <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Carrying Value at January 31, 2017 <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom"> January 31, 2017 </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 1 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 2 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 3 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Total </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Marketable securities- available for sale </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total assets </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Derivative liabilities </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">2,088,684</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">2,088,684</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Total liabilities </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">2,088,684</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">2,088,684</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> </table> <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Carrying Value at January 31, 2016 <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom"> January 31, 2016 </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 1 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 2 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 3 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Total </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Marketable securities- available for sale </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">78,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">78,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total assets </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">78,300</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">78,300</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Derivative liabilities </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">620,237</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">620,237</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Total liabilities </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">620,237</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">620,237</td> <td valign="bottom" width="1%">   </td> </tr> </table> <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Recent Accounting Pronouncements <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">In September 2017, the FASB has issued Accounting Standards Update (ASU) No. 2017-13, “Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of Prior SEC Staff Announcements and Observer Comments.” The amendments in ASU No. 2017-13 amends the early adoption date option for certain companies related to the adoption of ASU No. 2014-09 and ASU No. 2016-02. Both of the below entities may still adopt using the public company adoption guidance in the related ASUs, as amended. The effective date is the same as the effective date and transition requirements for the amendments for ASU 2014-09 and ASU 2016-02. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">In May 2014, the FASB issued an accounting standards update which modifies the requirements for identifying, allocating, and recognizing revenue related to the achievement of performance conditions under contracts with customers. This update also requires additional disclosure related to the nature, amount, timing, and uncertainty of revenue that is recognized under contracts with customers. This guidance is effective for fiscal and interim periods beginning after December 15, 2017 and is required to be applied retrospectively to all revenue arrangements. The adoption of this guidance is not expected to have a significant impact on the Company’s consolidated financial statements. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">In January 2017, the FASB has issued Accounting Standards Update (ASU) No. 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” These amendments eliminate Step 2 from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. Effective for public business entities that are a SEC filers for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. ASU 2017-04 should be adopted on a prospective basis. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. This new standard clarifies the definition of a business and provides a screen to determine when an integrated set of assets and activities is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This new standard will be effective for the Company on January 1, 2018, however, early adoption is permitted with prospective application to any business development transaction. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">In December 2016, the FASB has issued Accounting Standards Update (ASU) No. 2016-20, “Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers.” The amendments affect narrow aspects of the guidance issued in ASU 2014-09 including Loan Guarantee Fees, Contract Costs, Provisions for Losses on Construction-Type and Production-Type Contracts, Disclosure of Remaining Performance Obligations, Disclosure of Prior Period Performance Obligations, Contract Modifications, Contract Asset vs. Receivable, Refund Liability, Advertising Costs, Fixed Odds Wagering Contracts in the Casino Industry, and Costs Capitalized for Advisors to Private Funds and Public Funds. The effective date and transition requirements for the amendments are the same as the effective date and transition requirements for FASB Accounting Standards Codification Topic 606. Public entities should apply Topic 606 (and related amendments) for annual reporting periods beginning after December 15, 2017, including interim reporting periods therein. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company is currently evaluating the method of adoption and the potential impact that Topic 606 may have on our financial position and results of operations. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Management has considered all recent accounting pronouncements issued. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.

<p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">NOTE 5 – ACQUISITIONS <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">XTELUS LLC and XETLUS S.A. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">On June 27, 2016, the Company entered into an acquisition agreement with NEOGEN Holdings LLC, whereby the Company acquired 100% of the membership interest of XTELUS LLC and XETLUS S.A. (“XTELUS”). The acquisition of XTELUS met the definition of a business in accordance with FASB ASC Topic 805, "Business Combinations". As such, the Company accounted for the acquisition as a business combination. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Management determined that the Company was the acquirer in the business combination in accordance with FASB ASC Topic 805, "Business Combinations," based on the following factors: (i) there was a change in control of XTELUS; (ii) the Company was the entity in the transaction that issued its equity instruments, and in a business combination, the acquirer usually is the entity that issues its equity interests; (iii) the Company's pre-transaction directors retained the largest relative voting rights of the Company post-transaction; (iv) the composition of the Company's current board of directors and management was the result of the appointment by the Company's pre-transaction directors. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The purchase price paid for the acquisition of XTELUS amounted to $100,000 and consisted of 1 Series D Preferred Stock, which is convertible into $100,000 of common shares at any time following 12 months from the issuance of such shares. The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date: <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom"> Fair Value of Consideration: </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> June 26, 2016 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> 1 share of Series D Preferred Shares </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">100,000</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total Purchase Price </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">100,000</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> </tr> <tr> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom"> Assets and Liabilities: </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" colspan="2"> June 26, 2016 </td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Current assets </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">51,374</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Current liabilities </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">(29,260</td> <td valign="bottom" width="1%">)</td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Goodwill </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">77,886</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Fair value of total assets </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">100,000</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> </tr> </table> <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Revenues of $922,912 and net loss of $58,297 since the acquisition date are included in the consolidated statements of operations and comprehensive income (loss) for the year ended January 31, 2017.  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Net D Consulting Inc. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">On April 24, 2015, the Company entered into an asset purchase and sale agreement with Net D Consulting Inc. ("Net D") which closed on May 1, 2015. Net D is controlled by Chris Hall, who is an officer, director, and a controlling shareholder of the Company. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The fair value of the consideration and the assets acquired is based on the aggregate value of the note payable, preferred stock and common stock issued in exchange for the software as shown below: <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The acquisition consisted of the purchase of a customer list which met the definition of a business in accordance with FASB ASC Topic 805, "Business Combinations". As such, the Company accounted for the acquisition as a business combination. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Management determined that the Company was the acquirer in the business combination in accordance with ASC Topic 805, "Business Combinations", based on the following factors: it involved a transaction or other event in which an acquirer obtains control of one or more businesses, which an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing a return in the form of dividends, lower costs, or other economic benefits directly to investors or other owners, members, or participants. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The purchase price paid for the assets acquired, as amended on December 21, 2015, amounted to $3,982,125 and consisted of the following: $150,000 in cash, a $350,000 note payable to a related party with 0% annual interest, 5,000,000 common shares valued at $66,500, 500 Series A Preferred shares valued at $0, 25,000,000 Series B Preferred shares valued at $415,625, and 3 Series C Preferred shares convertible into $3,000,000 common shares. The Company paid net cash of $134,531 for acquisition of Net D’s asset. The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date: <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="font: 10pt/normal 'times new roman'; width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; word-spacing: 0px; orphans: 2; widows: 2; font-size-adjust: none; font-stretch: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom" width="87%"> Fair Value of Consideration: </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="10%" colspan="2"></td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Cash </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%"> $ </td> <td valign="bottom" width="9%"> 150,000 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> Note payable to related party </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="9%"> 350,000 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> 5,000,000 common shares </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="9%"> 66,500 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> 500 Series A Preferred shares </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="9%"> - </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> 25,000,000 Series B Preferred shares convertible into common shares </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="9%"> 415,625 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> 3 Series C Preferred shares convertible into common shares </td> <td valign="bottom" width="1%"></td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%"> 3,000,000 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Total Purchase Price </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%"> $ </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%"> 3,982,125 </td> <td valign="bottom" width="1%"></td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"></td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="9%"></td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Recognized amounts of identifiable assets acquired: </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="9%"></td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> Assets: </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="9%"></td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Customer list </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%"> $ </td> <td valign="bottom" width="9%"> 433,376 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> Goodwill </td> <td valign="bottom" width="1%"></td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%"> 3,548,749 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Fair value of total assets </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%"> $ </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%"> 3,982,125 </td> <td valign="bottom" width="1%"></td> </tr> </table> <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Connexum, LLC. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">On January 18, 2016, the Company entered into an acquisition agreement with Net D, whereby the Company acquired 100% of the membership interest of Connexum, LLC (“Connexum”) from Net D, a related party. The acquisition of Connexum met the definition of a business in accordance with FASB ASC Topic 805, "Business Combinations". As such, the Company accounted for the acquisition as a business combination. Net D and Connexum are controlled by Chris Hall, who is an officer, director, and a controlling shareholder of the Company. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Management determined that the Company was the acquirer in the business combination in accordance with FASB ASC Topic 805, "Business Combinations", based on the following factors: (i) there was a change in control of Connexum; (ii) the Company was the entity in the transaction that issued its equity instruments, and in a business combination, the acquirer usually is the entity that issues its equity interests; (iii) the Company's pre-transaction directors retained the largest relative voting rights of the Company post-transaction; (iv) the composition of the Company's current board of directors and management was the result of the appointment by the Company's pre-transaction directors. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">On January 18, 2016, the purchase price paid for the acquisition of Connexum amounted to $2,054,375 and consisted of the following: a $1,000,000 note with annual interest of 18% which matures on August 1, 2017 and 5,000,000 Series B Preferred shares valued at $54,375. The note provides for monthly principal and interest payments of $63,806. The agreement also provides for contingent consideration of 1 Series C Preferred share convertible into $1,000,000 common shares if Connexum achieves 80% of anticipated revenue and another 1 Series C Preferred share convertible into $1,000,000 common shares if Connexum achieves 100% of anticipated revenue within one year from the date of acquisition. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">On January 16, 2017, the Company entered into amendment to acquisition agreement, to amend for issuing Series D Preferred Shares instead of issuing Series C Preferred shares, as follows; <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">10 Series D Preferred Shares of Gawk Incorporated, if Connexum achieves 80% of anticipated revenue and another 10 Series D Preferred Shares of Gawk Incorporated, if Connexum achieves 100% of anticipated revenue, for a total of 20 shares of Series D Preferred Shares of Gawk Incorporated. The Series D Preferred Shares will convert at the rate of $100,000 for each Series D Preferred Shares held. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">On January 18, 2017, Connexum achieved 100% of anticipated revenue within one year from the date of acquisition. As a result, Gawk issued 20 Series D Preferred Shares and recognized additional goodwill of $1,000,000. Total goodwill generated from acquisition of Connexum was $1,416,851 as of January 31, 2017 <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date: <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom"> Fair Value of Consideration: </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> January 18, 2016 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Note payable to related party </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">1,000,000</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> 5,000,000 Series B Preferred shares </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">54,375</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Contingent consideration – 20 Series D Preferred shares </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">2,000,000</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total Purchase Price </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">3,054,375</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> </tr> <tr> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Fair Value of Consideration: </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" colspan="2"> January 18, 2016 </td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Current assets </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">86,132</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Current liabilities assumed </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">(172,763</td> <td valign="bottom" width="1%">)</td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Customer list </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">1,724,155</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Goodwill </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">1,416,851</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Fair value of total assets </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">3,054,375</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> </tr> </table> <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Unaudited combined proforma results of operations for the year ended January 31, 2017 and 2016 as though the Company acquired Connexum, Net D, and XTELUS on February 1, 2015, are set forth below: <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" colspan="6"> January 31, </td> <td valign="bottom">   </td> </tr> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> 2017 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> 2016 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Revenues </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">6,054,109</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">5,688,741</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Cost of revenues </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">4,711,771</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">4,085,383</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Gross profit </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">1,342,338</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">1,603,358</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Operating expenses </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">8,992,236</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">4,082,657</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Operating loss </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">(7,649,898</td> <td valign="bottom" width="1%">)</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">(2,479,299</td> <td valign="bottom" width="1%">)</td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Other expense </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">(4,744,045</td> <td valign="bottom" width="1%">)</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">(3,143,033</td> <td valign="bottom" width="1%">)</td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Gain (loss) from discontinued operations </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">16,118</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">(1,239,427</td> <td valign="bottom" width="1%">)</td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Net Loss </td> <td valign="bottom" width="1%">   </td> <td style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="9%">(12,377,825</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">)</td> <td valign="bottom" width="1%">   </td> <td style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="9%">(6,861,759</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">)</td> </tr> </table> <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">WebRunner, LLC <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">On October 30, 2014, the Company, through a comprehensive agreement with Webrunner, LLC (“Webrunner”), has purchased a complete data center. The Company sold WebRunner on October 31, 2016 (see Note 6). <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The fair value of the consideration and the assets acquired is based on the aggregate value of the common stock issued in exchange for the software as shown below: <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The acquisition consisted primarily of the purchase of a data center and all of its business, which are considered to meet the definition of a business in accordance with FASB ASC Topic 805, "Business Combinations". As such, the Company accounted for the acquisition as a business combination. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Management determined that the Company was the acquirer in the business combination in accordance with ASC Topic 805, "Business Combinations", based on the following factors: (i) there was a change in control of Webrunner; (ii) the Company was the entity in the transaction that issued its equity instruments, and in a business combination, the acquirer usually is the entity that issues its equity interests; (iii) the Company’s pre-transaction directors retained the largest relative voting rights of the Company post-transaction; (iv) the composition of the Company’s current board of directors and management was the result of the appointment by the Company’s pre-transaction directors. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The purchase price paid for the acquisition was $2,104,932 which included $225,000 in cash, 1 Series C Preferred share convertible into $1,000,000 of common stock and 9,100,000 options to purchase stock at an exercise price of $0.10 valued at $879,932 using the Black Scholes option pricing model. The assumptions used to value the options were as follows: a) stock price of $0.0978; b) strike price of $0.10, c) term of 5 years and d) volatility of 268%. The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date: <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> October 30, 2014 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td valign="top"> Fair Value of Consideration: </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%" colspan="2">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Cash </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">225,000</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> 1 Series C Preferred share convertible into common shares </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">1,000,000</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> 9,100,000 options at an exercise price of $0.10 </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">879,932</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total Purchase Price </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">2,104,932</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Recognized amounts of identifiable assets acquired: </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Assets: </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Cash </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">190,931</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> IP Address </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">81,920</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Customer list </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">359,067</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Equipment </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">176,975</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Goodwill </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">1,310,908</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Fair value of total assets </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">2,119,801</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Note payable RND Media </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">(10,000</td> <td valign="bottom" width="1%">)</td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Accounts payable and accrued liabilities </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">(4,869</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">)</td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Fair value of net assets </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">2,104,932</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> </tr> </table> <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Webrunner, Inc. assets includes IP Address space assigned to it through American Registry for Internet Numbers (ARIN) which consists of a /19, pronounced “Slash Nineteen”, which contains 8192 IP Addresses that are used in conjunction with our services provided to our customers. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">An Internet Protocol address (IP address) is a numerical label assigned to each device (e.g., computer, printer) participating in a computer network that uses the Internet Protocol for communication. An IP address serves two principal functions: host or network interface identification and location addressing. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The designers of the Internet Protocol defined an IP address as a 32-bit number and this system, known as Internet Protocol Version 4 (IPv4), is still in use today. However, because of the growth of the Internet and the predicted depletion of available addresses, a new version of IP (IPv6), using 128 bits for the address, was developed in 1995. IPv6 was standardized as RFC 2460 in 1998, and its deployment has been ongoing since the mid-2000s. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">IP addresses are usually written and displayed in human-readable notations, such as 172.16.254.1 (IPv4), and 2001:db8:0:1234:0:567:8:1 (IPv6). <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Internet Assigned Numbers Authority (IANA) manages the IP address space allocations globally and delegates five regional Internet registries (RIRs) to allocate IP address blocks to local Internet registries (Internet service providers) and other entities. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The expected of the Equipment, IP Addresses and Customer List is 3 years of which we will be applying both amortization and depreciation on a quarterly basis in a straight line format. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The comprehensive agreement call for the implementation of three employment agreement and three management agreements for the members of Webrunner LLC. The Company has not adopted an employee stock option plan which has been approved by the shareholders.

<p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">NOTE 15 – INCOME TAXES <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The benefit for income taxes from continued operations for the years ended January 31, 2017 and 2016 consist of the following: <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" valign="bottom" colspan="6"> Year Ended </td> <td valign="bottom">   </td> </tr> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" colspan="6"> January 31, </td> <td valign="bottom">   </td> </tr> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> 2017 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> 2016 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td valign="top"> Current: </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%" colspan="2">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%" colspan="2">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Federal </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> State </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Deferred: </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Federal </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">871,182</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">531,744</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> State </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">230,607</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">140,756</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">1,101,789</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">672,500</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Valuation allowance </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">(1,101,789</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">)</td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">(672,500</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">)</td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Provision benefit for income taxes, net </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> </tr> </table> <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The difference between income tax expense computed by applying the federal statutory corporate tax rate and actual income tax expense is as follows: <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" colspan="6"> January 31, </td> <td valign="bottom">   </td> </tr> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" colspan="2"> 2017 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" colspan="2"> 2016 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" valign="bottom" colspan="2">   </td> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" valign="bottom" colspan="2">   </td> <td valign="bottom">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom"> Statutory federal income tax rate </td> <td valign="bottom">   </td> <td align="center" valign="bottom" width="9%" colspan="2"> (34% </td> <td valign="bottom"> ) </td> <td valign="bottom">   </td> <td align="center" valign="bottom" width="9%" colspan="2"> (34% </td> <td valign="bottom"> ) </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> State income taxes and other </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">9</td> <td valign="bottom" width="1%">%</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">9</td> <td valign="bottom" width="1%">%</td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Change in valuation allowance </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">34</td> <td valign="bottom" width="1%">%</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">34</td> <td valign="bottom" width="1%">%</td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Effective tax rate </td> <td valign="bottom" width="1%">   </td> <td style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="1%">   </td> <td align="right" style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="1%">   </td> <td align="right" style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> </table> <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Deferred income taxes result from temporary differences in the recognition of income and expenses for the financial reporting purposes and for tax purposes. The tax effect of these temporary differences representing deferred tax asset and liabilities result principally from the following: <p style="margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" colspan="6"> January 31, </td> <td valign="bottom">   </td> </tr> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> 2017 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> 2016 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td>   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%" colspan="2">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%" colspan="2">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Net operating loss carryforward </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">4,517,999</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">3,416,210</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Valuation allowance </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">(4,517,999</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">)</td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">(3,416,210</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">)</td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Deferred income tax asset </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 3px;" valign="bottom" width="1%">   </td> </tr> </table> <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Deferred income taxes result from temporary differences in the recognition of income and expenses for the financial reporting purposes and for tax purposes. The Company has a net operating loss carryforward of approximately $10,507,000 available to offset future taxable income through 2035. For income tax reporting purposes, the Company’s aggregate unused net operating losses are subject to limitations of Section 382 of the Internal Revenue Code, as amended. Under the Tax Reform Act of 1986, the benefits from net operating losses carried forward may be impaired or limited on certain circumstances. Events which may cause limitations in the amount of net operating losses that the Company may utilize in any one year include, but are not limited to, a cumulative ownership change of more than 50% over a three-year period. The consolidation of any limitations that may be imposed for future issuances of equity securities, including issuances with respect to acquisitions have not been determined. The Company has provided a valuation reserve against the full amount of the net operating loss benefit, because in the opinion of management based upon the earning history of the Company; it is more likely than not that the benefits will not be realized. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">For the years ended January 31, 2017 and 2016, the difference between the amounts of income tax expense or benefit that would result from applying the statutory rates to pretax income to the reported income tax expense of $0 is the result of the net operating loss carryforward and the related valuation allowance. <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company anticipates it will continue to record a valuation allowance against the losses of certain jurisdictions, primarily federal and state, until such time as it is able to determine it is “more-likely-than-not” the deferred tax asset will be realized. Such position is dependent on whether there will be sufficient future taxable income to realize such deferred tax assets. The Company’s effective tax rate may vary from period to period based on changes in estimated taxable income or loss by jurisdiction, changes to the valuation allowance, changes to federal, state or foreign tax laws, future expansion into areas with varying country, state, and local income tax rates, deductibility of certain costs and expenses by jurisdiction. <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Tax returns for the years ended 2011 through 2017, are subject to examination.

<p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Fair Value of Financial Instruments <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company's financial instruments consist primarily of cash, accounts payable and accrued expenses, and debt. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments. <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company adopted ASC Topic 820, Fair Value Measurements (“ASC Topic 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The standard provides a consistent definition of fair value which focuses on an exit price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard also prioritizes, within the measurement of fair value, the use of market-based information over entity specific information and establishes a three-level hierarchy for fair value measurements based on the nature of inputs used in the valuation of an asset or liability as of the measurement date. <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The three-level hierarchy for fair value measurements is defined as follows: <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0.5in; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="text-align: justify; width: 100%; font: 10pt 'times new roman'; font-stretch: normal;" border="0" cellspacing="0" cellpadding="0"> <tr> <td width="4%">   </td> <td valign="top" width="4%">·</td> <td valign="top">Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; liabilities in active markets;</td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> </tr> <tr> <td>   </td> <td valign="top">·</td> <td valign="top">Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability other than quoted prices, either directly or indirectly, including inputs in markets that are not considered to be active; or directly or indirectly including inputs in markets that are not considered to be active;</td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> </tr> <tr> <td>   </td> <td valign="top">·</td> <td valign="top">Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement</td> </tr> </table> <p style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The following table summarizes fair value measurements by level at January 31, 2017 and January 31, 2016 for assets measured at fair value on a recurring basis: <p style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Carrying Value at January 31, 2017 <p style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="text-align: justify; widows: 2; text-transform: none; text-indent: 0px; width: 100%; font-family: 'times new roman'; orphans: 2; letter-spacing: normal; font-size: 10pt; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td style="border-bottom: black 1px solid;" valign="bottom"> January 31, 2017 </td> <td valign="bottom">   </td> <td align="center" style="border-bottom: black 1px solid;" id="hdcell" valign="bottom" width="9%" colspan="2"> Level 1 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom: black 1px solid;" id="af4c2bbe1-48f6-4351-aa19-9d6aeb830013" valign="bottom" width="9%" colspan="2"> Level 2 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom: black 1px solid;" id="ae0ef5a50-4b43-4ea5-ba9e-30d031de8116" valign="bottom" width="9%" colspan="2"> Level 3 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom: black 1px solid;" id="aca441a17-8c29-49c0-b430-c80a39655a8e" valign="bottom" width="9%" colspan="2"> Total </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Marketable securities- available for sale </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: black 1px solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom: black 1px solid;" id="ffcell" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: black 1px solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom: black 1px solid;" id="a3a952711-2cba-4e17-952c-daa8d89d8b49" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: black 1px solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom: black 1px solid;" id="a0363fcbd-6772-435d-9bc2-6aa96a87415d" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: black 1px solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom: black 1px solid;" id="a53186187-37f9-489a-bde6-2e369420f038" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total assets </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a912f469e-fe2d-4537-97e5-35a43d664851" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a63e69ab7-ad2e-437e-b056-47ac1c468cee" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a3d09b1b3-68fe-42e4-a643-7d62918831b8" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a2d905fdd-20e9-4639-8ff7-68ecc7842a77" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="aed365a79-8b15-4f20-aa1a-4df2af16f902" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a123c510d-e09a-4467-b936-923730f773be" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a139f0b72-5be5-48b8-9d2b-af0de3ebe7fe" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a1897694a-71f2-42de-b88f-e3ed69c0e69a" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Derivative liabilities </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: black 1px solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom: black 1px solid;" id="ac6a04bc8-9e59-4cdf-a243-bc186906dbae" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: black 1px solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom: black 1px solid;" id="ac3405a59-9045-41dc-8443-1b98c7f8b537" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: black 1px solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom: black 1px solid;" id="ae550f05e-c2d8-435c-a3ea-d2761789b55f" valign="bottom" width="9%">2,088,684</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: black 1px solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom: black 1px solid;" id="a76f26f23-d82a-48e3-b0a7-5c9402f984e4" valign="bottom" width="9%">2,088,684</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Total liabilities </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" id="afee14188-b3dd-4033-a0b8-f76b5eabb50d" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" id="afed05a2f-669b-4def-98e3-67424c2acef5" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" id="a86038e3d-db1d-4a7d-b382-a6371ebcecc1" valign="bottom" width="9%">2,088,684</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" id="a983d7745-e98b-4160-aa68-da3e66f27481" valign="bottom" width="9%">2,088,684</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> </table> <p style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Carrying Value at January 31, 2016 <p style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="text-align: justify; widows: 2; text-transform: none; text-indent: 0px; width: 100%; font-family: 'times new roman'; orphans: 2; letter-spacing: normal; font-size: 10pt; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td style="border-bottom: 1px solid;" valign="bottom"> January 31, 2016 </td> <td valign="bottom">   </td> <td align="center" style="border-bottom: 1px solid;" id="a6c4607c0-d400-4bc0-9c32-9a64d75263fe" valign="bottom" width="9%" colspan="2"> Level 1 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom: 1px solid;" id="a3f2cb9fb-3c71-420f-b105-916be878dadd" valign="bottom" width="9%" colspan="2"> Level 2 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom: 1px solid;" id="a1840863e-9ea1-4a3f-830a-cd5b09822504" valign="bottom" width="9%" colspan="2"> Level 3 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom: 1px solid;" id="ae67b3241-9657-4a9c-881f-772891b8a279" valign="bottom" width="9%" colspan="2"> Total </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Marketable securities- available for sale </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: 1px solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom: 1px solid;" id="aebc2f52e-2224-4e14-ace3-c804e133abff" valign="bottom" width="9%">78,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: 1px solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom: 1px solid;" id="ad84640f3-4042-4841-86bc-b566cdd035be" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: 1px solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom: 1px solid;" id="a8d788a09-7a87-4e7c-9797-49c9e18c9c19" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: 1px solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom: 1px solid;" id="aaf9dc082-e561-4381-825b-f8ff3a90ca2c" valign="bottom" width="9%">78,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total assets </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a7af3f5ea-762a-4e68-8f99-b27efaa5ceff" valign="bottom" width="9%">78,300</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="af3ffec50-68ec-4d30-a3cc-08f721fbcf90" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="adcb65f5e-751a-4d5d-b486-49ad7666a22e" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a6de1926d-d4f9-443e-b830-16582225eb35" valign="bottom" width="9%">78,300</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a35b81623-674c-429e-ac2a-b22cc35b525d" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a7fa73e67-8e76-498d-9457-6f2e6a67732c" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="abd8ce48b-0ad9-4c8d-9672-1ad75cf171cb" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a0a7a115c-0d9a-42ee-aa5c-15e4c5f5d535" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Derivative liabilities </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: 1px solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom: 1px solid;" id="a4b7d8d64-059d-48d5-8ba1-c65ba613d53f" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: 1px solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom: 1px solid;" id="a6cf1ce4b-ac38-4628-b929-5b1052129e7c" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: 1px solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom: 1px solid;" id="a552c16b5-12c7-4815-bf85-7e587e319a60" valign="bottom" width="9%">620,237</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom: 1px solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom: 1px solid;" id="a52d48cbf-71ee-44ba-a1f1-b6f71437b5a4" valign="bottom" width="9%">620,237</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Total liabilities </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" id="a5d7d5c82-316a-45f0-8d6c-965406df6a46" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" id="ab36eb480-5fc1-4dbd-ace6-7a3aef63b5ad" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" id="aa526cf9d-6276-4566-89a2-98de6fdf35ea" valign="bottom" width="9%">620,237</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" id="ab0524fe5-661b-4870-a778-0000215a771f" valign="bottom" width="9%">620,237</td> <td valign="bottom" width="1%">   </td> </tr> </table> <div> </div>

<table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom"> January 31, 2017 </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 1 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 2 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 3 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Total </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Marketable securities- available for sale </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total assets </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">102,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Derivative liabilities </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">2,088,684</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: black; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">2,088,684</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Total liabilities </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">2,088,684</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">2,088,684</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> </table> <p style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <table style="width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom"> January 31, 2016 </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 1 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 2 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Level 3 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%" colspan="2"> Total </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> <td>   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Marketable securities- available for sale </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">78,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">$</td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">78,300</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total assets </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">78,300</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">78,300</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Derivative liabilities </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">-</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">620,237</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td align="right" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%">620,237</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Total liabilities </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">620,237</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">$</td> <td align="right" valign="bottom" width="9%">620,237</td> <td valign="bottom" width="1%">   </td> </tr> </table>

<table style="font: 10pt/normal 'times new roman'; width: 87%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; word-spacing: 0px; orphans: 2; widows: 2; font-size-adjust: none; font-stretch: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom" width="87%"> Fair Value of Consideration: </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="10%" colspan="2"></td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Cash </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%"> $ </td> <td valign="bottom" width="9%"> 150,000 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> Note payable to related party </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="9%"> 350,000 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> 5,000,000 common shares </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="9%"> 66,500 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> 500 Series A Preferred shares </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="9%"> - </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> 25,000,000 Series B Preferred shares convertible into common shares </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="9%"> 415,625 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> 3 Series C Preferred shares convertible into common shares </td> <td valign="bottom" width="1%"></td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%"> 3,000,000 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Total Purchase Price </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%"> $ </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%"> 3,982,125 </td> <td valign="bottom" width="1%"></td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"></td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="9%"></td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Recognized amounts of identifiable assets acquired: </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="9%"></td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> Assets: </td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="1%"></td> <td valign="bottom" width="9%"></td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Customer list </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%"> $ </td> <td valign="bottom" width="9%"> 433,376 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="87%"> Goodwill </td> <td valign="bottom" width="1%"></td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" width="9%"> 3,548,749 </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="87%"> Fair value of total assets </td> <td valign="bottom" width="1%">   </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="1%"> $ </td> <td style="border-bottom-color: currentcolor; border-bottom-width: 3px; border-bottom-style: double;" valign="bottom" width="9%"> 3,982,125 </td> <td valign="bottom" width="1%"></td> </tr> </table>

<table style="text-align: justify; widows: 2; text-transform: none; text-indent: 0px; width: 100%; font-family: 'times new roman'; orphans: 2; letter-spacing: normal; font-size: 10pt; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" valign="bottom" colspan="2"> Year Ended </td> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" valign="bottom" colspan="2"> Year Ended </td> <td valign="bottom">   </td> </tr> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" colspan="2"> January 31, 2017 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" valign="bottom" colspan="2"> January 31, 2016 </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom"> Expected term </td> <td valign="bottom">   </td> <td align="center" valign="bottom" colspan="2">  0 - 1.50 years </td> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" valign="bottom" colspan="2"> 0.4 - 2 years </td> <td valign="bottom">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom"> Expected average volatility </td> <td valign="bottom">   </td> <td align="center" valign="bottom" width="9%" colspan="2"> 120% - 716 </td> <td valign="bottom"> % </td> <td valign="bottom">   </td> <td align="center" valign="bottom" width="9%" colspan="2"> 249% - 328 </td> <td valign="bottom"> % </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Expected dividend yield </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">-</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" valign="bottom" width="9%">0</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Risk-free interest rate </td> <td valign="bottom" width="1%">   </td> <td colspan="2"> 0.18% - 0.84 </td> <td valign="bottom" width="1%"> % </td> <td valign="bottom" width="1%">   </td> <td colspan="2"> 0.05% - 0.83 </td> <td valign="bottom" width="1%"> % </td> </tr> </table>

78300

102300

620237

2088684

3245991

3400

164794

1920490

3400

164794

1920490

159000

620237

2088684

1200003

3626635

P3Y

27000000

39000000

2149666

1700000

449666

2660742

1700000

83951

876791

1000000

2104932

3982125

3054375

100000

190931

359067

81920

433376

1724155

176975

2119801

3982125

10000

4869

2104932

3054375

100000

25000000

9100000

41000000

0.10

350000

1000000

66500

54375

100000

5000000

500

5000000

86132

51374

172763

29260

1000000 2000000 1 20

5688741

6054109

-6861759

-12377825

4085383 4711771 1603358 1342338 4082657 8992236

0.0978

0.10

P5Y

P4M24D

P2Y

P0Y

P1Y6M

2.68

2.49

3.28

1.20

7.16

0.00

1.00

0.18

0.1800

0.15

0.1500

922912

-58297

301324

Monthly

The agreement also provides for contingent consideration of 1 Series C Preferred share convertible into $1,000,000 common shares if Connexum achieves 80% of anticipated revenue and another 1 Series C Preferred share convertible into $1,000,000 common shares if Connexum achieves 100% of anticipated revenue within one year from the date of acquisition.

176975

58992

44244

2598518

359067

81920

433376

1724155

1806075

81920

1724155

155736

746487

85000

10000

25000

50000

282250

975000

1257250

574252

500000

100476

10000

231250

773599

25000

65476

542349

1800000

1000000

1700000

449666

75000

574252

579784

424178

1266417

147741

69549

60000

71131

75757

18000000

2054226375

1700000

863000

250000

3985956874

1945239 2061952

0.10

0.0005

586250

0.10

0.05

0.12

0.08

9 months to 2 years

9 months to 20 months

1.18

1.48

1.50

1.18

55142

146976

250733

1889299

0.00

0.0005

0.0083

0.0018

0.0084

620237

2088684

620237

259000 1356692

238314

1417063

796629

-62608

1.25 13437500 13437500

17000000

5000000

17000000

9100000

P2Y9M

0.10

9100000

0.10

51% voting right

Basis of 1 Series B Preferred share for 1.25 common shares (1:1.25)

1000000

100000

0.005

2976771

19817

2976771

-2976771

1564800

77633

112229

44000

1125000

P48M 0.50

1125000

180572

562500

600000

20000

580000

531744

871182

140756

230607

672500

1101789

-672500

-1101789

0.34

0.09

0.34

3416210

4517999

3416210

4517999

10507000

2035-01-31

Events which may cause limitations in the amount of net operating losses that the Company may utilize in any one year include, but are not limited to, a cumulative ownership change of more than 50% over a three-year period.

200

435200

438854

27942

271200

235917

164000

214708

18876

14000000

16000000

2100000

0.001

100

1000

100

1000

-5503686

-12319782

111467

-1239427

16118

-1239427

-95349

23344

-0.03

-0.02

-0.01

0.00

-6743113

-12327008

-204427 -598790 413861

9100000

36100000

25000000

401052

0.10

0.03

0.0009

361000

41000

-41000

318484

225575

179228

186913

178680

134011

1200003 13438 1000000 13438 13438 13438 -2479299 -7649898 3143033 4744045 16 5 5 2 2 2 -1239427 16118 13437500 1 13437500 13437500 13437500

35744

37880

12992

5472

6401

5188

7827

31440

156809

66412

22507

19920

22895

25075

23344

125000

<table style="width: 100%; text-align: justify; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 10pt; word-spacing: 0px; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;" border="0" cellspacing="0" cellpadding="0"> <tr> <td valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" id="hdcell" valign="bottom" width="9%" colspan="2"> Assigned Notes </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" id="a5456b4be-c582-4c4f-bd18-1dba219610be" valign="bottom" width="9%" colspan="2"> Principal amount </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" id="a4f354c9b-480b-499f-bfc0-66e143cf7d58" valign="bottom" width="9%" colspan="2"> Accrued interest </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> <td valign="bottom">   </td> <td align="center" style="border-bottom-color: currentcolor; border-bottom-width: 1px; border-bottom-style: solid;" id="a3f7b3915-3b86-4148-aa91-4d721178b4bb" valign="bottom" width="9%" colspan="2"> Prepayment penalties </td> <td style="padding-bottom: 1px;" valign="bottom">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Tranches in effect as of January 31, 2017 </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="ffcell" valign="bottom" width="9%">5</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%"> $ </td> <td align="right" id="a3bd6d9eb-7c33-411e-b314-61a3788e7003" valign="bottom" width="9%">147,741</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%"> $ </td> <td align="right" id="a7d453da7-3a95-4ef6-8ee5-27427aa6d5d7" valign="bottom" width="9%">12,992</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%"> $ </td> <td align="right" id="a7c2d33f2-13c6-4457-a738-84c9d5266c0a" valign="bottom" width="9%">66,412</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td>   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="af9110014-133b-4b8b-b2dd-5ad94c79575c" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="aed9dc762-55a7-4d6c-b87b-5574f526d619" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a46eeba13-f6dc-4164-9daf-5581e1fa0111" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="abca177a5-3eba-49cf-b186-7273d30a99d7" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Tranches in not effect as of January 31, 2017 </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a20ee3b17-a44d-4de5-acd1-d947ed374f75" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a1afa6bec-34bf-48e8-8251-4474d12de528" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a707b588f-f1f4-4b88-b99b-68fba8bbd01c" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a921c7f60-8b17-4707-926b-8e1f51b016e8" valign="bottom" width="9%">   </td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Tranches in effect as of February 12, 2017 </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="ad52b50e4-25be-4484-bd42-dfdc5959707a" valign="bottom" width="9%">5</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="ab19473af-bd24-40ad-831f-438869ef228e" valign="bottom" width="9%">69,549</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="aeb272ac2-e085-4996-a2a6-cb0e61843e26" valign="bottom" width="9%">5,472</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="acab0f397-a281-4cc4-8d60-32bb3df5e161" valign="bottom" width="9%">22,507</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Tranches in effect as of March 12, 2017 </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a5db20c3b-7f0c-47aa-a28c-e06c87b0051f" valign="bottom" width="9%">2</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a42ff38b5-d077-48c0-88ef-d2e31a610a78" valign="bottom" width="9%">60,000</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a12c15b69-1e68-42d9-b71c-9e23c1b77131" valign="bottom" width="9%">6,401</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a1d905e66-bef3-412f-94d9-dc71a3a472b7" valign="bottom" width="9%">19,920</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Tranches in effect as of April 12, 2017 </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a45ef7e08-5a38-4646-8439-b1cfa12f150d" valign="bottom" width="9%">2</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a6606c560-ef04-4d25-8fb6-1897c3aff9f2" valign="bottom" width="9%">71,131</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a126e5178-8228-4ebf-996c-9b6d986ef752" valign="bottom" width="9%">5,188</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a8c526b8b-4013-49a9-9c63-a2a311a74d81" valign="bottom" width="9%">22,895</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#cceeff"> <td valign="top"> Tranches in effect as of May 12, 2017 </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a970447af-8133-4605-a3be-57d47064d088" valign="bottom" width="9%">2</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="ad7cf7432-0e82-4b9d-804f-ccadd0486832" valign="bottom" width="9%">75,757</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="abe8e136f-1197-41c0-ac70-a484a53a3c56" valign="bottom" width="9%">7,827</td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td align="right" id="a074686ed-3eb5-4faf-a00e-f8f70890a274" valign="bottom" width="9%">25,075</td> <td valign="bottom" width="1%">   </td> </tr> <tr bgcolor="#ffffff"> <td valign="top"> Total </td> <td valign="bottom" width="1%">   </td> <td style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="1%">   </td> <td align="right" style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" id="a748a5136-feac-49a8-95f9-eb158662f6ea" valign="bottom" width="9%">16</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="1%"> $ </td> <td align="right" style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" id="ab949abe9-982e-4244-8168-345c7d1d9c71" valign="bottom" width="9%">424,178</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="1%"> $ </td> <td align="right" style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" id="a1b7bf869-1e59-46e6-a978-08bc5bdb4cd4" valign="bottom" width="9%">37,880</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> <td valign="bottom" width="1%">   </td> <td style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" valign="bottom" width="1%"> $ </td> <td align="right" style="border-top-color: currentcolor; border-bottom-color: currentcolor; border-top-width: 1px; border-bottom-width: 3px; border-top-style: solid; border-bottom-style: double;" id="a2e65d5c8-da88-4cdb-892e-ca5ebbbd7769" valign="bottom" width="9%">156,809</td> <td style="padding-bottom: 1px;" valign="bottom" width="1%">   </td> </tr> </table> <p align="justify" style="margin: 0px 0px 0px 0in; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; font-family: 'times new roman'; font-size: 13.33px; font-style: normal; font-weight: normal; word-spacing: 0px; white-space: normal; orphans: 2; widows: 2; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-variant-ligatures: normal; font-variant-caps: normal;">  100000

12809

-23344 -23344

302394

58991

110905

119689

58992 117984 44244 119688 239378 89766 15000000000

-500

375750 142670 5517

361000

-2956954

-1629773

9279

-2956954 -1564800

269287

188249

397

401052

33333

25000 25000 25000 75000 582903 582903 122050 51000

5000

1054375 100000 13438 1556000 5517 75000 20183 4587156 13042 1545000

16150000

134960

40000 85000 98930

-0

-1546

2950

1404

2 2 340200 177000 469730 1289210 P18M P238D 562500 562500

250000

750000

20000

50000

74252

0.0729 0.0325 226985 1 90397 7000000

1200003

3807207

2 3

340200

177000

20000000

7000000

81472

10000

20000

500000

6500000

1 3000000

1000000

100000

1000000

7000000

1257250

282250

975000

1257250

574252

773599

231250

773599

542349

1333672

5637900

1145278

4391933

133436

63334

326899

1351818

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1258063

267646

10 Certain notes allow for the conversion price to be a floor of $0.0005 and $0.00005 per share <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">Related Parties <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">  <p align="justify" style="text-align: justify; widows: 2; text-transform: none; font-style: normal; text-indent: 0px; margin: 0px 0px 0px 0in; font-family: 'times new roman'; white-space: normal; orphans: 2; letter-spacing: normal; color: #000000; font-size: 13px; font-weight: normal; word-spacing: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial;">The Company follows ASC 850, "Related Party Disclosures," for the identification of related parties and disclosure of related party transactions. See note 16. 0001546392us-gaap:SeriesDPreferredStockMembergawk:XtelusMember2017-06-012017-06-26 879932 0001546392gawk:ConnexumLlcMember2017-01-18

1000000

4560

63806

0001546392gawk:NotesPayableRelatedPartyMembergawk:NotesPayableIssuanceDateDecemberTwentyOneTwoThousandSixteenMember2016-02-012017-01-31

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available for sale Marketable securities - available for sale Deposits Assets, Current Deposit Deposit - CipherLoc Prepaid Expense and Other Assets, Current Prepaid and other current assets Assets, Current Total Current Assets Total Current Assets Property, Plant and Equipment, Net Web equipment, net of depreciation of $14,748 Equipment, net of accumulated depreciation of $0 and $73,740 Total Equipment Finite-Lived Intangible Assets, Net, Total Intangible assets and proprietary technology, net of accumulated amortization of $656,244 and $312,173 Total intangible assets Net Goodwill Goodwill Assets Total assets TOTAL ASSETS Liabilities and Equity [Abstract] LIABILITIES AND STOCKHOLDERS' DEFICIT Liabilities, Current [Abstract] Current Liabilities Accounts Payable and Accrued Liabilities, Current Accounts payable and accrued liabilities Note payable, net of unamortized discounts of $1,546 and $0 Total notes payable Less: current portion of notes payable Current portion of note payable -related party Total notes payable Less: current portion of notes payable Current portion of notes payable -related party Current portion of notes payable -related party Current portion of notes payable -related party Convertible Notes Payable, Current Convertible Promissory Note Less: current portion of convertible notes payable Current portion of convertible notes payable, net of unamortized discounts of $598,790 and $148,069 Less: current portion of convertible notes payable Less: current portion of convertible notes payable Investor Payable Investor payable - common shares Amount of investor payable. Preferred Shares Payable For Acquisition Preferred shares payable Current portion of the carrying amount of a preferred shares payable for acquisition. Business Combination, Contingent Consideration, Liability, Current Contingent consideration Due to Related Parties, Current Amounts due to related parties Due to related parties Derivative Liability, Current Derivative liabilities Liabilities, Current Total Current Liabilities Liabilities, Noncurrent [Abstract] Long-Term Liabilities Convertible Notes Payable, Noncurrent Long-term convertible notes payable Convertible notes payable, net of unamortized discounts of $0 and $56,358 Long-term convertible notes payable Long-term convertible notes payable Notes Payable, Related Parties, Noncurrent Notes payables -related party, less current portion Long-term notes payable Liabilities TOTAL LIABILITIES Temporary Equity, Carrying Amount, Attributable to Parent Convertible preferred stock, value Stockholders' Equity Attributable To Parent [Abstract] Stockholders' Deficit Preferred Stock, Value, Issued Preferred stock, $0.001 par value; authorized 100,000,000 shares Common Stock, Value, Issued Common stock, $0.001 par value, 14,900,000,000 shares authorized; 2,357,089,633 and 261,863,258 shares issued and outstanding, respectively Additional Paid In Capital Additional paid-in capital Retained Earnings (Accumulated Deficit) Accumulated deficit Deficit accumulated during development stage Accumulated deficit Stockholders' Equity Attributable to Parent Total Stockholders' Equity (Deficit) Total Stockholders' Deficit Balance Balance Liabilities and Equity Total Liabilities and Stockholders' Equity (Deficit) TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment Accumulated depreciation Accumulated depreciation on equipment (in dollars) Less - accumulated depreciation Accumulated depreciation of tangible assets Finite-Lived Intangible Assets, Accumulated Amortization Accumulated amortization on intangible assets (in dollars) Accumulated amortization of intangible assets Less - accumulated amortization of intangible assets Unamortized discounts (in dollars) Notes discount and financing fee Less: debt discount and deferred financing fees Unamortized discounts (in dollars) Debt Instrument, Unamortized Discount Discount on convertible note payable (in dollars) Debt discount on convertible debenture Discount on convertible note payable (in dollars) Discount on convertible note payable (in dollars) Long Term Debt Instrument Unamortized Discount The amount of long term debt discount that was originally recognized at the issuance of the instrument that has yet to be amortized. Discount on convertible note payable, non current portion (in dollars) Preferred Stock, Par or Stated Value Per Share Preferred stock, par value Preferred stock, par value (in dollars per share) Preferred Stock, Shares Authorized Preferred stock, shares authorized Preferred Stock, Shares Issued Preferred stock, shares issued Preferred Stock, Shares Outstanding Preferred stock, shares outstanding Common Stock, Par or Stated Value Per Share Common stock, par value (in dollars per share) Common stock, par value (in dollars per share) Common stock, par value Common Stock, Shares Authorized Common stock, shares authorized Common Stock, Shares, Issued Common stock, shares issued Common Stock, Shares, Outstanding Common stock, shares outstanding Temporary Equity, Par or Stated Value Per Share Convertible preferred stock (in dollars per shares) Temporary Equity, Shares Authorized Convertible preferred stock, shares authorized Temporary Equity, Shares Issued Convertible preferred stock, shares issued Temporary Equity, Shares Outstanding Convertible preferred stock, shares outstanding Consolidated Statements of Operations and Comprehensive Income (Loss) [Abstract] Income Statement [Abstract] Sales Revenue, Services, Net Revenue Cost of Services Cost of revenue Gross Profit Gross profit Gross profit Operating Expenses [Abstract] Operating expenses General and Administrative Expense General and administration General and administrative Research and Development Expense Research and development cost Research and development Litigation Settlement, Expense Legal settlement Legal settlement Write off of Deposit Impairment loss Impairment loss Depreciation, Depletion and Amortization, Nonproduction Depreciation and amortization Operating Expenses Total operating expenses Operating expenses Total operating expenses Operating Income (Loss) Operating loss Net loss from operations Nonoperating Income (Expense) [Abstract] Other income (expense) Other Nonoperating Income (Expense) Other income Investment Income, Investment Expense Interest expense Interest expense, net Marketable Securities, Gain (Loss) Unrealized gain on marketable securities (Gain)/Loss on change in fair value of marketable securities (Gain)/Loss on change in fair value of marketable securities Derivative, Gain (Loss) on Derivative, Net, Total Change in fair value of derivative liabilities Aggregate gain on derivatives Change in fair value of derivative liabilities Aggregate loss on derivatives Gain (Loss) on Sale of Debt Investments Gain on settlement of debt Loss on settlement of debt Nonoperating Income (Expense) Total other (income) expenses Total other expense Income (Loss) from Continuing Operations, Net of Tax, Attributable to Parent Loss from continuing operations Gain (loss) from discontinued operations, net of tax benefits Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax, Total Gain on sales of assets Gain on sale of assets Gain on sale of assets Gain on sale of asset Discontinued Operation, Income (Loss) from Discontinued Operation During Phase-out Period, Net of Tax, Total Loss from discontinued operations Loss from discontinued operations Loss from discontinued operations Income (Loss) from Discontinued Operations, Net of Tax, Attributable to Parent, Total Total gain (loss) from discontinued operations Net Income (Loss) Attributable to Parent Net income Net loss Net loss Net loss Preferred Stock Dividends, Income Statement Impact Dividend on Series B Preferred Stock Net loss attributable to common stockholders Net loss attributable to common stockholders Other Comprehensive Income (Loss), Net of Tax Other comprehensive income Comprehensive Income (Loss), Net of Tax, Attributable to Parent Comprehensive Loss Net loss Comprehensive Loss Income (Loss) from Continuing Operations, Per Basic and Diluted Share Basic and diluted loss per common share from continued operation (in dollars per share) Discontinued Operation, Income (Loss) from Discontinued Operation, Net of Tax, Per Basic and Diluted Share Basic and diluted loss per common share from discontinued operation (in dollars per share) Weighted Average Number Of Shares Outstanding, Basic and Diluted Weighted average of shares outstanding Weighted average number of common shares outstanding, basic and diluted (in shares) Statement of Stockholders' Equity [Abstract] Common Stock [Member] Common Stock Additional Paid-in Capital [Member] Additional Paid in Capital (Deficiency) AOCI Attributable to Parent [Member] Other Comprehensive Income (Loss) Accumulated Other Comprehensive Income (Loss) Retained Earnings [Member] Accumulated Deficit Increase (Decrease) in Stockholders' Equity [Roll Forward] Shares, Outstanding Balance (in shares) Balance (in shares) Stock Issued During Period Value Issued To Directors Common stock issued to directors Represents the amount related to stock issued to directors. Stock Issued During Period Shares Issued To Directors Common stock issued to directors (in shares) Represents the number of shares issued to directors during the period. Stock Issued During Period, Value, Issued for Services Common stock issued for services Common stock issued for services, financing fees and to settle accounts payable Common stock issued for services Stock Issued During Period, Shares, Issued for Services Number of common shares issued as payment for services Common stock issued for services, financing fees and to settle accounts payable (in shares) Stock Issued During Period Common Stock Issued For Legal Settlement Value Common stock issued for legal settlement Represents common stock value issued for legal settlement. Stock Issued During Period Common Stock Issued For Legal Settlement Shares Common stock issued for legal settlement (in shares) Number of shares issued for legal settlement. Stock Issued During Period Value Exercise Of Warrant Common stock issued in exchange for warrants Common stock issued in exchange for warrants Represents the amount related to stock issued during period value exercise of warrant. Stock Issued During Period Shares Exercise Of Warrant Common stock issued in exchange for warrants (in shares) Common stock issued in exchange for warrants (in shares) Represents the amount related to stock issued during period shares exercise of warrant. Stock Repurchased and Retired During Period, Shares Series A Preferred Shares returned and cancelled (in shares) Stock Issued During Period, Value, Purchase of Assets Series B Preferred shares issued for acquisition - Net D's assets Series A and B Preferred shares issued for acquisition - Net D's assets Preferred shares issued for purchase of assets Common stock issued for acquisition Stock Issued During Period, Shares, Purchase of Assets Preferred shares issued for purchase of assets (in shares) Series A and B Preferred shares issued for acquisition - Net D's assets (in shares) Common stock issued for acquisition (in shares) Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition Stock-based compensation Stock Issued During Period, Value, Stock Options Exercised Common stock issued for exercise of stock options Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period Exercised Number of options exercised as fair value of consideration Common stock issued for exercise of stock options (in shares) Exercised Stock Issued During Period Value For Preferred Stock Payable Preferred shares issued for - preferred stock payable Series B Preferred shares issued for - preferred stock payable Represents value of stock issued for preferred stock payable during the period. Stock Issued During Period Shares For Preferred Stock Payable Preferred shares issued for - preferred stock payable (in shares) Series B Preferred shares issued for - preferred stock payable (in shares) Represents the number of shares issued for preferred stock payable during the period. Stock Issued During Period, Value, New Issues Series C Preferred Stock, Purchase price Series B Preferred shares issued for cash Value of common shares issued Preferred shares issued for cash Preferred stock shares issued under purchase agreement Stock Issued During Period, Shares, New Issues Number of shares issued Series B Preferred shares issued for cash (in shares) Number of new stock issued during the period. Preferred shares issued for cash (in shares) Preferred stock issued under purchase agreement Stock Issued During Period Value Acquisitions Two Series B and C Preferred shares issued for acquisition - Connexum Series B Preferred shares issued for acquisition - Connexum Represents stock issued during period. Stock Issued During Period Shares Acquisitions Two Series B and C Preferred shares issued for acquisition - Connexum (in shares) Series B Preferred shares issued for acquisition - Connexum (in shares) Represents shares related to stock issued during period for acquisition. Preferred B and C exchanged for due to related parties Preferred shares issued for due to related parties Series B Preferred shares issued for due to related parties Represents the amount related to stock issued during period value due to related parties. Stock Issued During Period Shares Due To Related Parties Preferred shares issued for due to related parties (in shares) Series B Preferred shares issued for due to related parties Represents the shares related to stock issued during period shares due to related parties. Adjustments to Additional Paid in Capital, Convertible Debt with Conversion Feature Beneficial conversion feature on Series B Preferred share Beneficial conversion feature Adjustments To Additional Paid In Capital, Deemed Dividend On Amortization Of Beneficial Conversion Deemed dividend on amortization of beneficial conversion feature on Series B Preferred shares Represents additional paid in capital, deemed dividend on amortization of beneficial conversion. Adjustments To Additional Paid In Capital Contribution Contribution Contribution Represents the amount related to adjustments to additional paid in capital contribution. Stock Issued During Period, Value, Conversion of Convertible Securities, Net of Adjustments Common stock issued from conversion of debt Common stock issued from conversion of debt Stock Issued During Period, Shares, Conversion of Convertible Securities Common stock issued from conversion of debt (in shares) Common stock issued from conversion of debt (in shares) Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax Foreign currency translation adjustment Foreign currency translation Adjustment To Additional Paid In Capital Reclassification Of Derivative Liability Reclassification of derivative liability from additional paid in capital Reclassification of derivative liability from additional paid in capital Represents reclassification of derivative liability from additional paid in capital. Reclassification of derivative liability from additional paid in capital Adjustments To Additional Paid In Capital Derivative Resolution Derivative resolution Derivative resolution Represents the amount related to adjustments to additional paid in capital derivative resolution. Statement Of Cash Flows [Abstract] Statement of Cash Flows [Abstract] Net Cash Provided by (Used in) Operating Activities, Continuing Operations [Abstract] CASH FLOWS FROM OPERATING ACTIVITIES: Adjustments To Reconcile Net Income (Loss) To Cash Provided By (Used In) Operating Activities [Abstract] Adjustments to reconcile net loss to net cash used in operating activities: Issuance of Stock and Warrants for Services or Claims Common stock, options, and warrants issued for services Common Stock Issued For Legal Settlement Common stock issued for legal settlement Common stock issued for legal settlement. Stock-based compensation Stock-based compensation Amortization of Debt Discount (Premium) Amortization of debt discount and deferred financing fees Amortization of debt discount Available-for-sale Securities, Gross Unrealized Gain (Loss) Unrealized gain (loss) on securities available for sale Unrealized gain on marketable securities Depreciation, Depletion and Amortization Amortization expense of intangible assets Depreciation, Discontinued Operations Depreciation for equipment Depreciation expense from discontinued operations Amount of depreciation and attributable to disposal group. Amortization, Discontinued Operations Amortization on intangible assets Amortization expense from discontinued operations Amount of amortization expense attributable to disposal group, including, but not limited to, discontinued operation. Provision for Doubtful Accounts Bad debt expense Bad debt expense for uncollectible amounts Loss on impairment of goodwill Goodwill impairment loss Goodwill impairment Impairment of Intangible Assets, Finite-lived Loss on impairment of intangible assets Written down value of software Write Off Of Deposit Write off of Deposit Represents the amount of write off of deposit. Loss On Stock For Liabilities Represents the value of loss on stock for liabilities. Loss on stock for liabilities Gain Loss On Settlement Of Liabilities Gain on settlement of liabilities Loss on settlement of debt Represents the amount related to gain loss on settlement of dept. Loss on settlement of liabilities Prepayment Penalty Prepayment penalty Represents the penalty for prepayment. Increase (Decrease) In Operating Capital [Abstract] Changes in operating assets and liabilities: Increase (Decrease) in Operating Assets [Abstract] (Increase) decrease in operating assets: Increase (Decrease) in Accounts Receivable Accounts receivable Accounts receivable Increase (Decrease) in Prepaid Expense and Other Assets Prepaid expenses and other assets Increase (Decrease) in Operating Liabilities [Abstract] Increase (decrease) in operating liabilities: Increase (Decrease) in Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities Increase (Decrease) in Due to Related Parties Due to related parties Increase (Decrease) in Accrued Liabilities Accrued expenses Net Cash Provided by (Used in) Operating Activities, Continuing Operations, Total Net cash used in operating activities Net cash used in operating activities Net Cash Used In Operating Activities Net cash used in operating activities Net Cash Provided by (Used in) Investing Activities, Continuing Operations [Abstract] CASH FLOWS FROM INVESTING ACTIVITIES: Cash Acquired from Acquisition Acquisition of XTELUS, net of cash acquired Acquisition of XTELUS, net of cash acquired Proceeds from sale of asset Proceeds from sale of asset Payments to Acquire Businesses, Net of Cash Acquired, Total Acquisition of Connexum, net of cash acquired Net cash paid for acquisition of Net D's assets Net Cash Provided by (Used in) Investing Activities, Continuing Operations Net Cash Provided by (Used in) Investing Activities Net Cash Provided by (Used in) Financing Activities, Continuing Operations [Abstract] CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from Notes Payable Total borrowings on note payable Proceeds from notes payable Proceeds from Convertible Debt Proceeds from promissory notes Proceeds from convertible notes, net of original issue discounts and deferred financing fees Payment of notes payable - related party Payment of notes payable Represents the amount of payments of note payable to related party. Payment of notes payable - related party Repayments of Convertible Debt Payment of convertible notes payable Payment of convertible notes payable Repayments of Notes Payable Repayment on note payable Payment of notes payable Payment of notes payable Proceeds from Issuance of Preferred Stock, Preference Stock, and Warrants Proceeds from issuance of Series B Preferred stock Proceeds from Issuance of Common Stock Proceeds from issuance of common stock Net Cash Provided by (Used in) Financing Activities, Continuing Operations, Total Net cash provided by financing activities Net Cash Provided By Financing Activities EX-101.PRE 11 gawk-20170131_pre.xml XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE XML 12 R1.htm IDEA: XBRL DOCUMENT

Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Jan. 31, 2017	Oct. 20, 2017	Jul. 31, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	Gawk Inc.
Entity Central Index Key	0001546392
Trading Symbol	gawk
Entity Current Reporting Status	No
Entity Voluntary Filers	No
Current Fiscal Year End Date	--01-31
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Entity Common Stock, Shares Outstanding		6,342,546,507
Entity Public Float			$ 9,900,000
Document Type	10-K
Document Period End Date	Jan. 31, 2017
Amendment Flag	false
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY

XML 13 R2.htm IDEA: XBRL DOCUMENT

CONSOLIDATED BALANCE SHEETS - USD ($)	Jan. 31, 2017	Jan. 31, 2016
Current Assets
Cash and cash equivalents	$ 133,249	$ 64,944
Accounts receivable, net	232,305	45,721
Marketable securities - available for sale	102,300	78,300
Deposit - CipherLoc		562,500
Prepaid and other current assets	54,028	32,200
Total Current Assets	521,882	783,665
Equipment, net of accumulated depreciation of $0 and $73,740		103,235
Intangible assets and proprietary technology, net of accumulated amortization of $656,244 and $312,173	1,149,831	2,286,345
Goodwill	1,416,851	4,076,505
TOTAL ASSETS	3,088,564	7,249,750
Current Liabilities
Accounts payable and accrued liabilities	1,953,401	717,469
Note payable, net of unamortized discounts of $1,546 and $0	98,930	85,000
Current portion of notes payable -related party	614,085	868,361
Current portion of convertible notes payable, net of unamortized discounts of $598,790 and $148,069	2,061,952	1,934,932
Investor payable - common shares	658,000	658,000
Preferred shares payable		13,438
Contingent consideration		1,000,000
Due to related parties	305,458	27,942
Derivative liabilities	2,088,684	620,237
Total Current Liabilities	7,780,510	5,925,379
Long-Term Liabilities
Convertible notes payable, net of unamortized discounts of $0 and $56,358		10,307
Notes payables -related party, less current portion	159,514	388,889
TOTAL LIABILITIES	7,940,024	6,324,575
Stockholders' Deficit
Preferred stock, $0.001 par value; authorized 100,000,000 shares
Common stock, $0.001 par value, 14,900,000,000 shares authorized; 2,357,089,633 and 261,863,258 shares issued and outstanding, respectively	2,357,089	261,863
Additional paid-in capital	984,577	670,962
Accumulated deficit	(26,361,315)	(14,057,651)
Total Stockholders' Deficit	(22,951,460)	(13,074,825)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	3,088,564	7,249,750
Series C Preferred stock
Long-Term Liabilities
Convertible preferred stock, value	16,000,000	14,000,000
Series D Preferred Stock
Long-Term Liabilities
Convertible preferred stock, value	2,100,000
Preferred Stock \| Series A Preferred Stock
Stockholders' Deficit
Preferred stock, $0.001 par value; authorized 100,000,000 shares	1	1
Total Stockholders' Deficit	1	1
Preferred Stock \| Series B Preferred shares
Stockholders' Deficit
Preferred stock, $0.001 par value; authorized 100,000,000 shares	68,188	50,000
Total Stockholders' Deficit	$ 68,188	$ 50,000

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CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($)	Jan. 31, 2017	Jan. 31, 2016
Accumulated depreciation on equipment (in dollars)	$ 0	$ 73,740
Accumulated amortization on intangible assets (in dollars)	656,244	312,173
Unamortized discounts (in dollars)	1,546	0
Discount on convertible note payable (in dollars)	598,790	148,069
Discount on convertible note payable, non current portion (in dollars)	$ 0	$ 56,358
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	100,000,000	100,000,000
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	14,900,000,000	14,900,000,000
Common stock, shares issued	2,357,089,633	261,863,258
Common stock, shares outstanding	2,357,089,633	261,863,258
Series C Convertible Preferred Stock
Convertible preferred stock (in dollars per shares)	$ 0.001	$ 0.001
Convertible preferred stock, shares authorized	100	100
Convertible preferred stock, shares issued	16	14
Convertible preferred stock, shares outstanding	16	14
Series D Convertible Preferred Stock
Convertible preferred stock (in dollars per shares)	$ 0.001	$ 0.001
Convertible preferred stock, shares authorized	1,000	1,000
Convertible preferred stock, shares issued	21	0
Convertible preferred stock, shares outstanding	21	0
Preferred Stock \| Series A Preferred Stock
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	1,000	1,000
Preferred stock, shares issued	1,000	1,000
Preferred stock, shares outstanding	1,000	1,000
Preferred Stock \| Series B Preferred shares
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	95,000,000	95,000,000
Preferred stock, shares issued	68,187,500	50,000,000
Preferred stock, shares outstanding	68,187,500	50,000,000

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($)	12 Months Ended
	Jan. 31, 2017	Jan. 31, 2016
Consolidated Statements of Operations and Comprehensive Income (Loss) [Abstract]
Revenue	$ 5,637,900	$ 1,333,672
Cost of revenue	4,391,933	1,145,278
Gross profit	1,245,967	188,394
Operating expenses
General and administration	3,180,510	1,805,223
Research and development		2,500
Legal settlement	525,000	54,000
Impairment loss	4,369,707	562,500
Depreciation and amortization	746,487	155,736
Total operating expenses	8,821,704	2,579,959
Net loss from operations	(7,575,737)	(2,391,565)
Other income (expense)
Other income	22,275	13,200
Interest expense, net	(1,808,729)	(544,616)
Unrealized gain on marketable securities	24,000	49,350
Change in fair value of derivative liabilities	(1,351,818)	326,899
Loss on settlement of debt	(1,629,773)	(2,956,954)
Total other expense	(4,744,045)	(3,112,121)
Loss from continuing operations	(12,319,782)	(5,503,686)
Gain (loss) from discontinued operations, net of tax benefits
Gain on sale of assets	111,467
Loss from discontinued operations	(95,349)	(1,239,427)
Total gain (loss) from discontinued operations	16,118	(1,239,427)
Net loss	(12,303,664)	(6,743,113)
Dividend on Series B Preferred Stock	(23,344)
Net loss attributable to common stockholders	(12,327,008)	(6,743,113)
Other comprehensive income		442
Comprehensive Loss	$ (12,327,008)	$ (6,742,671)
Basic and diluted loss per common share from continued operation (in dollars per share)	$ (0.02)	$ (0.03)
Basic and diluted loss per common share from discontinued operation (in dollars per share)	$ 0.00	$ (0.01)
Weighted average number of common shares outstanding, basic and diluted (in shares)	724,811,630	194,920,175

XML 16 R5.htm IDEA: XBRL DOCUMENT

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($)	Preferred Stock Series A	Preferred Stock Series B	Common Stock	Additional Paid in Capital (Deficiency)	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Total
Balance at Jan. 31, 2015	$ 1		$ 161,732	$ (823,401)	$ (442)	$ (7,314,538)	$ (7,976,648)
Balance (in shares) at Jan. 31, 2015	1,000		161,732,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock issued to directors			$ 21,000	140,100			161,100
Common stock issued to directors (in shares)			21,000,000
Common stock issued for services, financing fees and to settle accounts payable			$ 22,282	145,903			168,185
Common stock issued for services, financing fees and to settle accounts payable (in shares)			22,282,156
Common stock issued for legal settlement			$ 2,700	51,300			54,000
Common stock issued for legal settlement (in shares)			2,700,000
Common stock issued in exchange for warrants			$ 4,960	491,040			496,000
Common stock issued in exchange for warrants (in shares)			4,960,000
Series A Preferred Shares returned and cancelled (in shares)	(500)
Series A and B Preferred shares issued for acquisition - Net D's assets		$ 11,562	$ 5,000	452,125			468,687
Series A and B Preferred shares issued for acquisition - Net D's assets (in shares)	500	11,562,500	5,000,000
Series B Preferred shares issued for cash		$ 8,438		39,062			47,500
Series B Preferred shares issued for cash (in shares)		8,437,500
Series B Preferred shares issued for acquisition - Connexum		$ 5,000		49,375			54,375
Series B Preferred shares issued for acquisition - Connexum (in shares)		5,000,000
Series B Preferred shares issued for due to related parties		$ 25,000		390,625			415,625
Series B Preferred shares issued for due to related parties		25,000,000
Contribution				5,000			5,000
Common stock issued from conversion of debt			$ 44,189	77,769			121,958
Common stock issued from conversion of debt (in shares)			44,189,102
Foreign currency translation					$ 442		442
Reclassification of derivative liability from additional paid in capital				(586,250)			(586,250)
Derivative resolution				238,314			238,314
Net loss						(6,743,113)	(6,743,113)
Balance at Jan. 31, 2016	$ 1	$ 50,000	$ 261,863	670,962		(14,057,651)	(13,074,825)
Balance (in shares) at Jan. 31, 2016	1,000	50,000,000	261,863,258
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation				361,000			361,000
Common stock issued for exercise of stock options			$ 41,000	(41,000)
Common stock issued for exercise of stock options (in shares)			41,000,000
Series B Preferred shares issued for - preferred stock payable		$ 13,438					13,438
Series B Preferred shares issued for - preferred stock payable (in shares)		13,437,500
Series B Preferred shares issued for cash		$ 4,750		15,250			20,000
Series B Preferred shares issued for cash (in shares)		4,750,000
Beneficial conversion feature on Series B Preferred share				23,344			23,344
Deemed dividend on amortization of beneficial conversion feature on Series B Preferred shares				(23,344)			(23,344)
Common stock issued from conversion of debt			$ 2,054,226	(1,438,698)			615,528
Common stock issued from conversion of debt (in shares)			2,054,226,375
Derivative resolution				1,417,063			1,417,063
Net loss						(12,303,664)	(12,303,664)
Balance at Jan. 31, 2017	$ 1	$ 68,188	$ 2,357,089	$ 984,577		$ (26,361,315)	$ (22,951,460)
Balance (in shares) at Jan. 31, 2017	1,000	68,187,500	2,357,089,633

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	Jan. 31, 2017	Jan. 31, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (12,303,664)	$ (6,743,113)
Adjustments to reconcile net loss to net cash used in operating activities:
Common stock, options, and warrants issued for services	177,000	656,443
Common stock issued for legal settlement		54,000
Stock-based compensation	361,000
Amortization of debt discount and deferred financing fees	1,110,707	342,831
Unrealized gain on marketable securities	(24,000)	(49,350)
Amortization expense of intangible assets	746,487	155,736
Depreciation expense from discontinued operations	44,244	58,992
Amortization expense from discontinued operations	89,766	119,688
Bad debt expense	18,876	11,782
Loss on impairment of goodwill	3,626,635	1,200,003
Loss on impairment of intangible assets	180,572
Write off of Deposit	562,500	562,500
Loss on stock for liabilities	1,564,800	2,956,954
Loss on settlement of liabilities	64,973
Prepayment penalty	188,249
Change in fair value of derivative liabilities	1,351,818	(326,899)
Gain on sale of asset	(111,467)
(Increase) decrease in operating assets:
Accounts receivable	(175,232)	41,212
Prepaid expenses and other assets	(1,079)	(32,200)
Increase (decrease) in operating liabilities:
Accounts payable and accrued liabilities	910,520	241,407
Due to related parties	712,716	277,942
Accrued expenses	269,287
Net Cash Used In Operating Activities	(635,292)	(472,072)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of XTELUS, net of cash acquired	397
Proceeds from sale of asset	401,052
Net cash paid for acquisition of Net D's assets		(134,531)
Net Cash Provided by (Used in) Investing Activities	401,449	(134,531)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable	147,050	75,000
Proceeds from convertible notes, net of original issue discounts and deferred financing fees	785,858	380,900
Proceeds from notes payable - related party	25,000
Payment of notes payable - related party	(582,903)
Payment of convertible notes payable	(33,333)
Payment of notes payable	(59,524)	(92,750)
Proceeds from issuance of Series B Preferred stock	20,000	47,500
Proceeds from issuance of common stock		5,000
Net Cash Provided By Financing Activities	302,148	415,650
Effect of exchange rate changes		442
Net increase (decrease) in cash and cash equivalents	68,305	(190,511)
Cash and cash equivalents, beginning of period	64,944	255,455
Cash and cash equivalents, end of period	133,249	64,944
Supplemental cash flow information
Cash paid for interest	242,902
Cash paid for taxes
Non-cash financing transactions:
Series B and Series C Preferred shares issued for due to related parties		438,854
Acquisition of Net D's assets through issuance of preferred shares, common shares and note payable		3,843,875
Acquisition of XTELUS through issuance of Series D Preferred shares	100,000
Series B Preferred shares issued to settle preferred share payable	13,438
Acquisition of Connexum/Webrunner through issuance of preferred shares and note payable		1,054,375
Contingent consideration related to acquisition of Connexum		1,000,000
Issuance of investor payable for acquisition		1,556,000
Issuance of common stock for conversion of debt and accrued interest	615,528	121,958
Common shares issued for deferred financing fees		13,042
Common stock issued for exercise of options and warrants	41,000	496,000
Debt discount from derivative liability	1,356,692	259,000
Reclassification of derivative liability from additional paid in capital due to tainted instruments		586,250
Derivative resolution	1,417,063	238,314
Accrued interest added to principal	5,517
Replacement of note payable to Convertible note	75,000
Acquisition of Connexum through contingent issuance of Series D Preferred shares	2,000,000
Series C Preferred shares issued to settle preferred share payable		$ 1,000,000
Beneficial conversion feature on Series B Preferred shares	$ 23,344

XML 18 R7.htm IDEA: XBRL DOCUMENT

DESCRIPTION OF BUSINESS

12 Months Ended

Jan. 31, 2017

Description of Business [Abstract]

DESCRIPTION OF BUSINESS

NOTE 1 – DESCRIPTION OF BUSINESS

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GOING CONCERN

12 Months Ended

Jan. 31, 2017

Going Concern Issues [Abstract]

GOING CONCERN

NOTE 2 – GOING CONCERN

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Jan. 31, 2017

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America. Significant accounting policies are as follows:

Use of Estimates and Assumptions

Principles of Consolidation

Reclassifications

Certain prior year amounts have been reclassified to conform with the current year presentation.

Cash and Cash Equivalents

Goodwill and Other Intangible Assets

Long-Lived Assets

Property and Equipment

Accounts Receivable and Allowance for Uncollectible Accounts

Marketable securities and other investments

Revenue Recognition

Our Business Services revenue includes monthly recurring charges (“MRC”) to customers, for whom charges are contracted over a specified period of time, and variable usage fees charged to customers that purchase our business products and services. Revenue recognition commences after the provisioning, testing and acceptance of the service by the customer. MRCs continue until the expiration of the contract, or until cancellation of the service by the customer. To the extent that payments received from a customer are related to a future period, the payment is recorded as deferred revenue until the service is provided or the usage occurs.

Income Taxes

Research and Development and Software Development Costs

Share-Based Compensation

Related Parties

The Company follows ASC 850, "Related Party Disclosures," for the identification of related parties and disclosure of related party transactions. See note 16.

Basic and Diluted Net Loss per Common Share

Concentration of Credit Risk

Derivative Financial Instruments

The fair value of an embedded conversion option that is convertible into a variable amount of shares and warrants that include price protection reset provision features are deemed to be “down-round protection” and, therefore, do not meet the scope exception for treatment as a derivative under ASC 815 “Derivatives and Hedging”, since “down-round protection” is not an input into the calculation of the fair value of the conversion option and warrants and cannot be considered “indexed to the Company’s own stock” which is a requirement for the scope exception as outlined under ASC 815.

Conversion options are recorded as debt discount and are amortized as interest expense over the life of the underlying debt instrument.

Fair Value of Financial Instruments

The three-level hierarchy for fair value measurements is defined as follows:

	·	Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; liabilities in active markets;

	·	Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability other than quoted prices, either directly or indirectly, including inputs in markets that are not considered to be active; or directly or indirectly including inputs in markets that are not considered to be active;

	·	Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement

The following table summarizes fair value measurements by level at January 31, 2017 and January 31, 2016 for assets measured at fair value on a recurring basis:

Carrying Value at January 31, 2017

January 31, 2017	Level 1		Level 2		Level 3		Total

Marketable securities- available for sale	$	102,300	$	-	$	-	$	102,300
Total assets		102,300		-		-		102,300

Derivative liabilities		-		-		2,088,684		2,088,684
Total liabilities	$	-	$	-	$	2,088,684	$	2,088,684

Carrying Value at January 31, 2016

January 31, 2016	Level 1		Level 2		Level 3		Total

Marketable securities- available for sale	$	78,300	$	-	$	-	$	78,300
Total assets		78,300		-		-		78,300

Derivative liabilities		-		-		620,237		620,237
Total liabilities	$	-	$	-	$	620,237	$	620,237

Recent Accounting Pronouncements

The Company is currently evaluating the method of adoption and the potential impact that Topic 606 may have on our financial position and results of operations.

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MARKETABLE SECURITIES

12 Months Ended

Jan. 31, 2017

Marketable Securities [Abstract]

MARKETABLE SECURITIES

NOTE 4 – MARKETABLE SECURITIES

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ACQUISITIONS

12 Months Ended

Jan. 31, 2017

Business Combination [Abstract]

ACQUISITIONS

NOTE 5 – ACQUISITIONS

XTELUS LLC and XETLUS S.A.

Fair Value of Consideration:	June 26, 2016
1 share of Series D Preferred Shares	$	100,000
Total Purchase Price	$	100,000

Assets and Liabilities:	June 26, 2016
Current assets	$	51,374
Current liabilities		(29,260	)
Goodwill		77,886
Fair value of total assets	$	100,000

Revenues of $922,912 and net loss of $58,297 since the acquisition date are included in the consolidated statements of operations and comprehensive income (loss) for the year ended January 31, 2017.

Net D Consulting Inc.

The fair value of the consideration and the assets acquired is based on the aggregate value of the note payable, preferred stock and common stock issued in exchange for the software as shown below:

Fair Value of Consideration:
Cash	$	150,000
Note payable to related party		350,000
5,000,000 common shares		66,500
500 Series A Preferred shares		-
25,000,000 Series B Preferred shares convertible into common shares		415,625
3 Series C Preferred shares convertible into common shares		3,000,000
Total Purchase Price	$	3,982,125

Recognized amounts of identifiable assets acquired:
Assets:
Customer list	$	433,376
Goodwill		3,548,749
Fair value of total assets	$	3,982,125

Connexum, LLC.

On January 16, 2017, the Company entered into amendment to acquisition agreement, to amend for issuing Series D Preferred Shares instead of issuing Series C Preferred shares, as follows;

The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date:

Fair Value of Consideration:	January 18, 2016
Note payable to related party	$	1,000,000
5,000,000 Series B Preferred shares		54,375
Contingent consideration – 20 Series D Preferred shares		2,000,000
Total Purchase Price	$	3,054,375

Fair Value of Consideration:	January 18, 2016
Current assets	$	86,132
Current liabilities assumed		(172,763	)
Customer list		1,724,155
Goodwill		1,416,851
Fair value of total assets	$	3,054,375

Unaudited combined proforma results of operations for the year ended January 31, 2017 and 2016 as though the Company acquired Connexum, Net D, and XTELUS on February 1, 2015, are set forth below:

	January 31,
	2017			2016
Revenues	$	6,054,109		$	5,688,741
Cost of revenues		4,711,771			4,085,383
Gross profit		1,342,338			1,603,358

Operating expenses		8,992,236			4,082,657
Operating loss		(7,649,898	)		(2,479,299	)

Other expense		(4,744,045	)		(3,143,033	)

Gain (loss) from discontinued operations		16,118			(1,239,427	)
Net Loss	$	(12,377,825	)	$	(6,861,759	)

WebRunner, LLC

The fair value of the consideration and the assets acquired is based on the aggregate value of the common stock issued in exchange for the software as shown below:

Management determined that the Company was the acquirer in the business combination in accordance with ASC Topic 805, "Business Combinations", based on the following factors: (i) there was a change in control of Webrunner; (ii) the Company was the entity in the transaction that issued its equity instruments, and in a business combination, the acquirer usually is the entity that issues its equity interests; (iii) the Company’s pre-transaction directors retained the largest relative voting rights of the Company post-transaction; (iv) the composition of the Company’s current board of directors and management was the result of the appointment by the Company’s pre-transaction directors.

	October 30, 2014
Fair Value of Consideration:
Cash	$	225,000
1 Series C Preferred share convertible into common shares		1,000,000
9,100,000 options at an exercise price of $0.10		879,932
Total Purchase Price	$	2,104,932

Recognized amounts of identifiable assets acquired:
Assets:
Cash	$	190,931
IP Address		81,920
Customer list		359,067
Equipment		176,975
Goodwill		1,310,908
Fair value of total assets		2,119,801
Note payable RND Media		(10,000	)
Accounts payable and accrued liabilities		(4,869	)
Fair value of net assets	$	2,104,932

IP addresses are usually written and displayed in human-readable notations, such as 172.16.254.1 (IPv4), and 2001:db8:0:1234:0:567:8:1 (IPv6).

The expected of the Equipment, IP Addresses and Customer List is 3 years of which we will be applying both amortization and depreciation on a quarterly basis in a straight line format.

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DISCONTINUED OPERATIONS

12 Months Ended

Jan. 31, 2017

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATIONS

NOTE 6 – DISCONTINUED OPERATIONS

The following table shows the results of operations of Webrunner for fiscal years 2017 and 2016 which are included in the gain (loss) from discontinued operations:

	Years Ended
	July 31,
	2017			2016
Revenue	$	225,575		$	318,484

Operating expenses
General and administration		(186,913	)		(179,228	)
Impairment loss		-			(1,200,003	)
Depreciation and amortization		(134,011	)		(178,680	)
Loss from discontinued operations	$	(95,349	)	$	(1,239,427	)

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EQUIPMENT

12 Months Ended

Jan. 31, 2017

Property, Plant and Equipment [Abstract]

EQUIPMENT

NOTE 7 – EQUIPMENT

Equipment at January 31, 2017 and 2016 consist of the following:

	January 31, 2017		January 31, 2016
Acquisition of Webrunner - Equipment		-		176,975
Total tangible assets		-		176,975
Accumulated depreciation of tangible assets		-		(73,740	)
Total tangible assets	$	-	$	103,235

Depreciation expense for the years ended January 31, 2017 and 2016 amounted to $44,244 and $58,992, respectively. All depreciation expenses are included in loss from discontinued operations.

On October 31, 2016, the Company entered into the asset purchase and sale agreement (the “Agreement”) with Giggle Fiber, LLC. Pursuant to the terms of the Agreement, the Company sold the equipment, customer list of Webrunner and bank accounts related to the Webrunner for $413,861, payable in instalments. The total consideration received was $401,052. The Company recorded gain on sales of asset of $111,467 as discontinued operations during the year ended January 31, 2017 (See Note 16).

The following table summarizes the carrying amounts of the sold assets;

	October 31,
Assets	2016
Bank accounts related to Webrunner	$	12,809
Equipment, net of depreciation of $117,984		58,991
Intangible assets, net of amortization $239,378		119,689
Goodwill		110,905
Total assets	$	302,394

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INTANGIBLES AND GOODWILL

12 Months Ended

Jan. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLES AND GOODWILL

NOTE 8 – INTANGIBLES AND GOODWILL

Intangible assets at January 31, 2017 and 2016 consist of the following:

	January 31, 2017			January 31, 2016
Customer list - Webrunner	$	-		$	359,067
IP Address - Webrunner		81,920			81,920
Customer list - Net D		-			433,376
Customer list - Connexum		1,724,155			1,724,155
Total intangible assets		1,806,075			2,598,518
Accumulated amortization of intangible assets		(656,244	)		(312,173	)
Total intangible assets	$	1,149,831		$	2,286,345

Goodwill at January 31, 2017 and 2016 consist of the following:

	January 31, 2017		January 31, 2016
Goodwill of Webrunner	$	-	$	110,905
Goodwill of Net D		-		3,548,749
Goodwill of Connexum		1,416,851		416,851
	$	1,416,851	$	4,076,505

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

XML 26 R15.htm IDEA: XBRL DOCUMENT

NOTES PAYABLE

12 Months Ended

Jan. 31, 2017

Convertible Notes Payable and Notes Payable [Abstract]

NOTES PAYABLE

NOTE 9 – NOTES PAYABLE

The Company had the following notes payable and notes payable - related party outstanding as of January 31, 2017 and 2016:

Notes Payable

	January 31, 2017			January 31, 2016
Dated – October 30, 2014	$	10,000		$	10,000
Dated – June 3, 2015		-			25,000
Dated – December 11, 2015		-			50,000
Dated – August 4, 2016		25,000			-
Dated – September 30, 2016		65,476			-
Total notes payable		100,476			85,000
Less: debt discount and deferred financing fees		(1,546	)		-
		98,930			85,000
Less: current portion of notes payable		98,930			85,000
Long-term notes payable	$	-		$	-

Dated - October 30, 2014

Dated - June 3, 2015 and December 11, 2015

Dated – August 4, 2016

Dated – September 30, 2016

Notes Payable - related party

	January 31, 2017		January 31, 2016
Dated – April 23, 2015	$	231,250	$	282,250
Dated - January 18, 2016		-		975,000
Dated - December 21, 2016		542,349		-
Total notes payable		773,599		1,257,250
Less: current portion of notes payable		614,085		868,361
Long-term notes payable	$	159,514	$	388,889

The total borrowings and principal repayment on related party note payable during the year ended January 31, 2017 was $25,000 and $582,903, respectively

Dated - April 23, 2015

Dated - January 18, 2016

Dated – December 21, 2016

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CONVERTIBLE NOTES PAYABLE

12 Months Ended

Jan. 31, 2017

Convertible Notes Payable and Notes Payable [Abstract]

CONVERTIBLE NOTES PAYABLE

NOTE 10 – CONVERTIBLE NOTES PAYABLE

The Company had the following convertible notes payable outstanding as of January 31, 2017 and 2016:

	January 31, 2017			January 31, 2016
Promissory Note - Issued August 22, 2014, with a fixed conversion price of $0.10 per common share or 17,000,000 shares of common stock.	$	1,700,000		$	1,700,000
Promissory notes – Issued in fiscal year 2016, with variable conversion features.		83,951			449,666
Promissory notes – Issued in fiscal year 2017, with variable conversion features.		876,791			-
Total convertible notes payable		2,660,742			2,149,666
Less: debt discount and deferred financing fees		(598,790	)		(204,427	)
		2,061,952			1,945,239
Less: current portion of convertible notes payable		2,061,952			1,934,932
Long-term convertible notes payable	$	-		$	10,307

The Company recognized amortization expense related to the debt discount and deferred financing fees of $1,109,303 and $342,831 for the year ended January 31, 2017 and 2016, respectively.

Promissory Note - August 22, 2014

Promissory Notes - Issued in fiscal year 2016

During the year ended January 31, 2016, the Company issued a total of $449,666 notes with the following terms:

	·	Terms ranging from 9 months to 2 years
	·	Annual interest rates ranging from 5% to 12%
	·	Convertible at the option of the holders either at issuance or 180 days from issuance. The note dated September 29, 2015 is convertible at the later of the maturity date or date of default.
	·	Conversion prices are typically based on the discounted (50% to 60% discount) lowest trading prices of the Company’s shares during various periods prior to conversion. Certain notes allow for the conversion price to be the lower of $0.01 or the discounted trading price

Promissory Notes - Issued in fiscal year 2017

During the year ended January 31, 2017, the Company issued a total of $1,266,417 notes with the following terms:

	·	Terms ranging from 9 months to 20 months
	·	Annual interest rates ranging from 8% to 12%
	·	Convertible at the option of the holders either at issuance or 180 days from issuance.
	·	Conversion prices are typically based on the discounted (50% to 60% discount) lowest trading prices of the Company’s shares during various periods prior to conversion. Certain notes allow for the conversion price to be a floor of $0.0005 and $0.00005 per share.

Replacement of Notes

The following table summarizes the detail of assigned 16 notes;

	Assigned Notes		Principal amount		Accrued interest		Prepayment penalties
Tranches in effect as of January 31, 2017		5	$	147,741	$	12,992	$	66,412

Tranches in not effect as of January 31, 2017
Tranches in effect as of February 12, 2017		5		69,549		5,472		22,507
Tranches in effect as of March 12, 2017		2		60,000		6,401		19,920
Tranches in effect as of April 12, 2017		2		71,131		5,188		22,895
Tranches in effect as of May 12, 2017		2		75,757		7,827		25,075
Total		16	$	424,178	$	37,880	$	156,809

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DERIVATIVE LIABILITIES

12 Months Ended

Jan. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE LIABILITIES

NOTE 11 – DERIVATIVE LIABILITIES

ASC 815 requires we assess the fair market value of derivative liability at the end of each reporting period and recognize any change in the fair market value as other income or expense item.

	Year Ended			Year Ended
	January 31, 2017			January 31, 2016
Expected term	0 - 1.50 years			0.4 - 2 years
Expected average volatility	120% - 716		%	249% - 328		%
Expected dividend yield		-			0
Risk-free interest rate	0.18% - 0.84		%	0.05% - 0.83		%

At January 31, 2017, the estimated fair values of the liabilities measured on a recurring basis are as follows:

January 31, 2017	Level 1		Level 2		Level 3		Total
Promissory Note – Issued August 22, 2014	$	-	$	-	$	3,400	$	3,400
Promissory Notes – Issued in fiscal year 2016		-		-		164,794		164,794
Promissory Notes – Issued in fiscal year 2017		-		-		1,920,490		1,920,490
Total liabilities	$	-	$	-	$	2,088,684	$	2,088,684

The following table summarizes the changes in the derivative liabilities during the year ended January 31, 2017:

Fair Value Measurements Using Significant Observable Inputs (Level 3)

Balance - January 31, 2015	$	-
Addition of new derivatives recognized as debt discounts		259,000
Addition of new derivatives recognized as options compensation		340,200
Addition of new derivatives recognized as day one loss on derivatives		469,730
Derivatives settled upon conversion of debt and exercise of warrants		(238,314	)
Reclassification from APIC to derivative due to tainted instruments		586,250
Loss on change in fair value of the derivative		(796,629	)
Balance - January 31, 2016	$	620,237

Addition of new derivatives recognized as debt discounts		1,356,692
Addition of new derivatives recognized as options compensation		177,000
Addition of new derivatives recognized as day one loss on derivatives		1,289,210
Derivatives settled upon conversion of debt and exercise of warrants		(1,417,063	)
Loss on change in fair value of the derivative		62,608
Balance - January 31, 2017	$	2,088,684

The net gain on derivatives during the year ended January 31, 2017 and 2016 was $1,351,818 and $326,899, respectively.

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STOCK PAYABLE

12 Months Ended

Jan. 31, 2017

Stock Payable [Abstract]

STOCK PAYABLE

NOTE 12 – STOCK PAYABLE

Investor payable - common shares

As of January 31, 2017, and 2016, investor payable – common stock totaled $658,000, respectively.

Preferred Stock Payable

As of January 31, 2017 and 2016, preferred stock payable totaled $0 and $13,438, respectively.

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EQUITY

12 Months Ended

Jan. 31, 2017

Equity [Abstract]

EQUITY

NOTE 13 – EQUITY

Amendment to Articles of Incorporation or Bylaws

Preferred Stock

Series A Preferred Stock

As of January 31, 2017, and 2016, 1,000 shares of series A Preferred Stock were issued and outstanding, respectively.

Series B Convertible Preferred Stock

During the year ended January 31, 2017, the Company issued Series B Preferred shares, as follows:

	·	On December 21, 2015, the Company recorded preferred stock payable of $13,438 for 13,437,500 Series B Preferred shares related to the acquisition of the assets of Net D. During the nine months ended October 31, 2016 the Company issued 13,437,500 Series B Preferred shares to settle this payable.
	·	On February 3, 2016, 4,750,000 shares were sold for cash of $20,000. On issuance, value of the underlining common stock represented a beneficial conversion feature of $23,344. The beneficial conversion feature will be recognized when the preferred stock becomes convertible on August 3, 2016 as a deemed dividend.

During the year ended January 31, 2016, the Company issued Series B Preferred shares, as follows:

	·	437,500 shares were sold for cash on June 22, 2015 for a total consideration of $17,500.
	·	25,000,000 shares with fair value of $415,625 in connection with the acquisition of Net D’s assets (see Note 5). Of this amount, the par value of $13,438 related to the 13,437,500 shares in excess of the authorized shares at January 31, 2016 is reported as preferred stock payable in the consolidated balance sheets
	·	5,000,000 shares with a fair value of $54,375 in connection with the acquisition of Connexum (see Note 5).
	·	25,000,000 shares with a fair value of $415,625 as settlement of amounts due to the CEO totaling $438,854. As a result, the Company recorded a loss on settlement of liabilities of $2,976,771 (see also below).
	·	8,000,000 shares were sold for cash in January 2016 for a total consideration of $30,000

As of January 31, 2017, and 2016, 68,187,500 and 50,000,000 shares of Series B Preferred Stock were issued and outstanding, respectively.

Series C Convertible Preferred Stock

During the year ended January 31, 2017, the Company issued Series C Preferred shares, as follows:

	·	1 share with a fair value of $1,000,000 as settlement of amounts due to the CEO totaling $271,200
	·	1 share with a fair value of $1,000,000 as settlement of amounts due to the CFO totaling $164,000

As a result, the Company recorded a loss on settlement of debt of $1,564,800.

During the year ended January 31, 2016, the Company issued Series C Preferred shares, as follows:

	·	1 share to settle the preferred stock payable of $1,000,000 recorded in connection with the acquisition of Webrunner
	·	3 shares with a fair value of $3,000,000 in connection with the acquisition of Net D’s assets (see Note 5).
	·	3 shares with a fair value of $3,000,000 as settlement of amounts due to the CEO totaling $438,854. As a result, the Company recorded a loss on settlement of debt of $2,976,771.

As of January 31, 2017, and 2016, 16 and 14 shares of Series C Preferred Stock were issued and outstanding, respectively.

Series D Convertible Preferred Stock

During year ended January 31, 2017, the Company issued Series D Preferred shares, as follows:

	·	1 share with a fair value of $100,000 in connection with the acquisition of XTELUS (see Note 5).
	·	20 shares with a fair value of $2,000,000 in connection with the acquisition of Connexum (See Note 5)

As of January 31, 2017 and 2016, 21 and 0 shares of Series D Preferred Stock were issued and outstanding, respectively.

Common stock

The Company is authorized to issue 14,900,000,000 shares of common stock at a par value of $0.001.

During the year ended January 31, 2017, the Company issued common shares, as follows:

	·	2,054,226,375 common shares were issued for the conversion of debt and accrued interest of $615,528.
	·	41,000,000 common shares in exchange for the exercise of options for no consideration

During the year ended January 31, 2016, the Company issued common shares, as follows:

	·	2,700,000 common shares with a fair market value of $54,000 to James E McCrink Trust in accordance with a settlement agreement reached with the latter on January 19, 2015 in connection with a complaint filed on November 4, 2014.
	·	21,000,000 shares with a fair value of $161,100 as compensation to board members and employees.
	·	16,150,000 shares with a fair value of $134,960 as compensation to consultants.
	·	4,587,156 shares with a fair value of $20,183 to settle a $40,000 payable. The Company recognized a gain on settlement of liabilities of $19,817.
	·	1,545,000 shares with a fair value of $13,042 as deferred financing fees
	·	4,960,000 shares in exchange for warrants for a total consideration of $496,000 (see Note 11).
	·	5,000,000 shares with fair value of $66,500 in connection with the acquisition of Net D’s assets (see Note 5).
	·	44,189,102 common shares were issued for the conversion of debt, accrued interest and associated fees of $121,958.

As of January 31, 2017, and 2016, 2,357,089,633 and 261,863,258 shares of common stock were issued and outstanding, respectively.

Warrants and Options

Warrants

As of January 31, 2017, and 2016, there are no warrants outstanding.

Options

The Company has 9,100,000 options issued in connection with the acquisition of Webrunner.

During the year ended January 31, 2017, 41,000,000 options were exercise and the corresponding derivative liability at the date of exercise of $159,000 was credited to additional paid in capital.

During the year ended January 31, 2017, 25,000,000 options were forfeited, as a result, the company recorded gain on change in fair value of derivative of $81,472.

The following table summarizes information relating to outstanding and exercisable stock options as of January 31, 2017:

	Options Outstanding
				Weighted Average
	Shares			Exercise Price

Outstanding, January 31, 2015		9,100,000		$	0.10
Granted		27,000,000		$	0.005
Exercised		-		$	-
Forfeited/canceled		-		$	-
Outstanding, January 31, 2016		36,100,000		$	0.03

Granted		39,000,000		$	-
Exercised		(41,000,000	)	$	(0.0009	)
Forfeited/canceled		(25,000,000	)	$	-
Outstanding, January 1, 2017		9,100,000		$	0.10

Options Outstanding						Options Exercisable
Number of Shares		Weighted Average Remaining Contractual life (in years)		Weighted Average Exercise Price		Number of Shares		Weighted Average Exercise Price
	9,100,000		2.75	$	0.10		9,100,000	$	0.10

The options have no intrinsic value at January 31, 2017.

Employee Incentive Bonus Plan

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COMMITMENTS AND CONTINGENCIES

12 Months Ended

Jan. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 14 – COMMITMENTS AND CONTINGENCIES

Rent

The lease is related to Webrunner business and on October 30, 2016, the Company entered into the sale of Webrunner business (See Note 6).

Rent expense from discontinued operations for the years ended January 31, 2017 and 2016 was $112,229 and $77,633, respectively.

Licensing Agreement / Deposit

Contingency

StoneRidge

Windstream Holdings, Inc.

On May 25, 2016, the Company reached a settlement with Windstream for $20,000, which the Company paid during the year ended January 31, 2017.

Tarpon Bay Partners LLC

John Boritz

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INCOME TAXES

12 Months Ended

Jan. 31, 2017

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 15 – INCOME TAXES

The benefit for income taxes from continued operations for the years ended January 31, 2017 and 2016 consist of the following:

	Year Ended
	January 31,
	2017			2016
Current:
Federal	$	-		$	-
State		-			-

Deferred:
Federal	$	871,182		$	531,744
State		230,607			140,756
		1,101,789			672,500
Valuation allowance		(1,101,789	)		(672,500	)
Provision benefit for income taxes, net	$	-		$	-

The difference between income tax expense computed by applying the federal statutory corporate tax rate and actual income tax expense is as follows:

	January 31,
	2017			2016

Statutory federal income tax rate	(34%		)	(34%		)
State income taxes and other		9	%		9	%
Change in valuation allowance		34	%		34	%
Effective tax rate		-			-

	January 31,
	2017			2016

Net operating loss carryforward	$	4,517,999		$	3,416,210
Valuation allowance		(4,517,999	)		(3,416,210	)
Deferred income tax asset	$	-		$	-

Tax returns for the years ended 2011 through 2017, are subject to examination.

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RELATED PARTY TRANSACTIONS

12 Months Ended

Jan. 31, 2017

RELATED PARTY TRANSACTIONS

NOTE 16 – RELATED PARTY TRANSACTIONS

During the years ended January 31, 2017 and 2016, the CEO advanced the Company cash of $200, and $0, respectively.

During the years ended January 31, 2017, the Company paid a total of $218,500 consulting fees to Scrip2Screen, an entity owned by Scott Kettle.

As of January 31, 2017, and 2016, the amount owed to the CEO and CFO was $0 and $0, respectively.

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SUBSEQUENT EVENTS

12 Months Ended

Jan. 31, 2017

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 17 – SUBSEQUENT EVENTS

Subsequent to January 31, 2017 through September 28, 2017, the Company had the following transactions:

	·	Issued an aggregate of 3,985,956,874 common shares were issued for the conversion of debt, accrued interest and associated fees of $214,708.
	·	The Company assigned 11 notes with principal amounts and accrued interest totaling to $301,324 to one lender which resulted to the payment of settlement premiums amounting to $90,397.
	·	On March 30, 2017, the Company entered into a Settlement Agreement with the former directors and officers of Webrunners.
	·	On February 27, 2017, the Company entered into an equity financing agreement. The Company shall issue and sell to the Investor, and the Investor shall purchase from the Company, up to that number of Shares having an aggregate Purchase Price of $7,000,000.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Jan. 31, 2017

Accounting Policies [Abstract]

Use of Estimates and Assumptions

Use of Estimates and Assumptions

Principles of Consolidation

Principles of Consolidation

Reclassifications

Reclassifications

Certain prior year amounts have been reclassified to conform with the current year presentation.

Cash and Cash Equivalents

Cash and Cash Equivalents

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

Long-Lived Assets

Long-Lived Assets

Property and Equipment

Property and Equipment

Accounts Receivable and Allowance for Uncollectible Accounts

Accounts Receivable and Allowance for Uncollectible Accounts

Marketable securities and other investments

Marketable securities and other investments

Revenue Recognition

Revenue Recognition

Our Business Services revenue includes monthly recurring charges (“MRC”) to customers, for whom charges are contracted over a specified period of time, and variable usage fees charged to customers that purchase our business products and services. Revenue recognition commences after the provisioning, testing and acceptance of the service by the customer. MRCs continue until the expiration of the contract, or until cancellation of the service by the customer. To the extent that payments received from a customer are related to a future period, the payment is recorded as deferred revenue until the service is provided or the usage occurs.

Income Taxes

Income Taxes

Research and Development and Software Development Costs

Research and Development and Software Development Costs

Share-Based Compensation

Share-Based Compensation

Related Parties

Related Parties

The Company follows ASC 850, "Related Party Disclosures," for the identification of related parties and disclosure of related party transactions. See note 16.

Basic and Diluted Net Loss per Common Share

Basic and Diluted Net Loss per Common Share

Concentration of Credit Risk

Concentration of Credit Risk

Derivative Financial Instruments

Derivative Financial Instruments

The fair value of an embedded conversion option that is convertible into a variable amount of shares and warrants that include price protection reset provision features are deemed to be “down-round protection” and, therefore, do not meet the scope exception for treatment as a derivative under ASC 815 “Derivatives and Hedging”, since “down-round protection” is not an input into the calculation of the fair value of the conversion option and warrants and cannot be considered “indexed to the Company’s own stock” which is a requirement for the scope exception as outlined under ASC 815.

Conversion options are recorded as debt discount and are amortized as interest expense over the life of the underlying debt instrument.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The three-level hierarchy for fair value measurements is defined as follows:

	·	Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; liabilities in active markets;

	·	Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability other than quoted prices, either directly or indirectly, including inputs in markets that are not considered to be active; or directly or indirectly including inputs in markets that are not considered to be active;

	·	Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement

The following table summarizes fair value measurements by level at January 31, 2017 and January 31, 2016 for assets measured at fair value on a recurring basis:

Carrying Value at January 31, 2017

January 31, 2017	Level 1		Level 2		Level 3		Total

Marketable securities- available for sale	$	102,300	$	-	$	-	$	102,300
Total assets		102,300		-		-		102,300

Derivative liabilities		-		-		2,088,684		2,088,684
Total liabilities	$	-	$	-	$	2,088,684	$	2,088,684

Carrying Value at January 31, 2016

January 31, 2016	Level 1		Level 2		Level 3		Total

Marketable securities- available for sale	$	78,300	$	-	$	-	$	78,300
Total assets		78,300		-		-		78,300

Derivative liabilities		-		-		620,237		620,237
Total liabilities	$	-	$	-	$	620,237	$	620,237

Recent Accounting Pronouncements

Recent Accounting Pronouncements

The Company is currently evaluating the method of adoption and the potential impact that Topic 606 may have on our financial position and results of operations.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Jan. 31, 2017

Accounting Policies [Abstract]

Schedule of fair value measured on recurring basis

January 31, 2017	Level 1		Level 2		Level 3		Total

Marketable securities- available for sale	$	102,300	$	-	$	-	$	102,300
Total assets		102,300		-		-		102,300

Derivative liabilities		-		-		2,088,684		2,088,684
Total liabilities	$	-	$	-	$	2,088,684	$	2,088,684

January 31, 2016	Level 1		Level 2		Level 3		Total

Marketable securities- available for sale	$	78,300	$	-	$	-	$	78,300
Total assets		78,300		-		-		78,300

Derivative liabilities		-		-		620,237		620,237
Total liabilities	$	-	$	-	$	620,237	$	620,237

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ACQUISITIONS (Tables)

12 Months Ended

Jan. 31, 2017

Schedule of consolidated results of operations acquisition

	January 31,
	2017			2016
Revenues	$	6,054,109		$	5,688,741
Cost of revenues		4,711,771			4,085,383
Gross profit		1,342,338			1,603,358

Operating expenses		8,992,236			4,082,657
Operating loss		(7,649,898	)		(2,479,299	)

Other expense		(4,744,045	)		(3,143,033	)

Gain (loss) from discontinued operations		16,118			(1,239,427	)
Net Loss	$	(12,377,825	)	$	(6,861,759	)

XTELUS LLC and XETLUS S.A.

Fair Value of Consideration:	June 26, 2016
1 share of Series D Preferred Shares	$	100,000
Total Purchase Price	$	100,000

Assets and Liabilities:	June 26, 2016
Current assets	$	51,374
Current liabilities		(29,260	)
Goodwill		77,886
Fair value of total assets	$	100,000

Net D Consulting Inc.

Fair Value of Consideration:
Cash	$	150,000
Note payable to related party		350,000
5,000,000 common shares		66,500
500 Series A Preferred shares		-
25,000,000 Series B Preferred shares convertible into common shares		415,625
3 Series C Preferred shares convertible into common shares		3,000,000
Total Purchase Price	$	3,982,125

Recognized amounts of identifiable assets acquired:
Assets:
Customer list	$	433,376
Goodwill		3,548,749
Fair value of total assets	$	3,982,125

Connexum, LLC.

Fair Value of Consideration:	January 18, 2016
Note payable to related party	$	1,000,000
5,000,000 Series B Preferred shares		54,375
Contingent consideration – 20 Series D Preferred shares		2,000,000
Total Purchase Price	$	3,054,375

Fair Value of Consideration:	January 18, 2016
Current assets	$	86,132
Current liabilities assumed		(172,763	)
Customer list		1,724,155
Goodwill		1,416,851
Fair value of total assets	$	3,054,375

WebRunner, LLC