UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

~~WASHINGTON~~Washington, D.C. 20549

~~FORM~~Form 10-Q

~~☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15~~(D)Mark ~~OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 30, 2016~~One)

☐x ~~TRANSITION~~QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(Dd) OF THE SECURITIES EXCHANGE ACT ~~For~~OF ~~the transition period from N/A to N/A~~1934

~~Commission~~For ~~File~~the ~~No.~~quarterly ~~000-55499~~period ended July 31, 2016

~~Gawk Incorporated~~or

~~(Name~~o ofTRANSITION ~~small~~REPORT ~~business~~UNDER ~~issuer~~SECTION as13 ~~specified~~OR in15(d) ~~its~~OF ~~charter)~~THE SECURITIES EXCHANGE ACT OF 1934

Nevada		33-1220317
( State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

For the transition period from _________ to _________

~~5300~~Commission ~~Melrose~~File ~~Avenue~~Number ~~Suite 42~~000-55499

~~Los~~Gawk ~~Angeles,~~Incorporated CA(Exact ~~90038~~name of registrant as specified in its charter)

(Address of principal executive offices) (Zip Code)

Nevada		33-1220317
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

5300 Melrose Avenue, Suite 42, Los Angeles, CA		90038
(Address of principal executive offices)		(Zip Code)

(888) -754-6190 (Registrant’s telephone number, including area code) ____________________________________________________________ (Former name, former address and former fiscal year, if changed since last report)

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

~~Indicate~~x byYES o check mark whether the Registrant (1) has filed all reports required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days: NO

Yes ☒ No ☐

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

~~Yes~~x ~~☒ No~~YES o ☐NO

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

Large accelerated filer ☐¨ Accelerated filer ☐¨ Non~~–Accelerated~~-accelerated filer ☐¨ (Do not check if a smaller reporting company) Smaller reporting company ☒x

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

~~Yes ☐ No ☒~~o YES x NO

~~Indicate~~APPLICABLE ~~the~~ONLY ~~number~~TO ofISSUERS ~~shares~~INVOLVED ~~outstanding~~IN ofBANKRUPTCYPROCEEDINGS ~~each~~DURING ofTHE ~~the~~PRECEDING ~~issuer's~~FIVE ~~classes of common stock, as of the latest practicable date.~~YEARS

Class		Outstanding at June 13, 2016
Common stock, $0.001 par value		357,651,221

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.

~~GAWK~~o ~~INCORPORATED~~YES o NO

~~INDEX~~APPLICABLE ONLY TO ~~FORM~~CORPORATE ~~10-Q FILING~~ISSUERS

~~FOR~~Indicate ~~THE~~the ~~THREE~~number ~~MONTHS~~of ~~ENDED APRIL~~shares 30outstanding of each of the issuer’s classes of common stock, ~~2016~~as of the latest practicable date.

576,970,215 common shares issued and outstanding as of September 7, 2016

TABLE OF CONTENTS

			PAGE
PART I - FINANCIAL INFORMATION
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	3
Item 1.		Consolidated Financial Statements (Unaudited)	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
		Consolidated Balance Sheets	3
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22
		Consolidated Statements of Operations	4
Item 4.	Controls and Procedures	22
		Consolidated Statements of Cash Flows	5
PART II - OTHER INFORMATION
		Notes to Unaudited Consolidated Financial Statements	6
Item 1.	Legal Proceedings	24
Item 2.		Management Discussion & Analysis of Financial Condition and Results of Operations	15
Item 1A.	Risk Factors	24
Item 3		Quantitative and Qualitative Disclosures About Market Risk	19
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	24
Item 4.		Controls and Procedures	19
Item 3.	Defaults Upon Senior Securities	24
PART II - OTHER INFORMATION
Item 4.	Mine Safety Disclosures	24
Item 1.		Legal Proceedings	20
Item 5.	Other Information	24
Item 1A.		Risk Factors	20
Item 6.	Exhibits	25
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds	20
SIGNATURES		26
Item 3.		Defaults Upon Senior Securities	20
Item 4.		Mining Safety Disclosures	20
Item 5		Other information	20
Item 6.		Exhibits	21
CERTIFICATIONS

31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act.
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act.
32.1	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act.

~~Table~~PART ofI ~~Contents~~- FINANCIAL INFORMATION

~~PART~~Item I1. Financial Statements

~~FINANCIAL~~GAWK ~~INFORMATION~~INCORPORATED

~~Item~~CONSOLIDATED 1.BALANCE ~~Financial Statements~~SHEETS

~~GAWK INCORPORATED~~(Unaudited)

CONSOLIDATED BALANCE SHEETS

	July 31,			January 31,
	2016			2016
ASSETS
Current Assets
Cash and cash equivalents	$	54,934		$	64,944
Accounts receivable		124,521			45,721
Marketable securities - available for sale		95,700			78,300
Deposit - CipherLoc		562,500			562,500
Prepaid and other current assets		52,949			32,200
Total Current Assets		890,604			783,665

Equipment, net of depreciation of $103,235 and $73,740		73,739			103,235
Intangible assets and proprietary technology, net of amortization $745,259 and $312,173		1,853,258			2,286,345
Goodwill		4,154,391			4,076,505
TOTAL ASSETS	$	6,971,992		$	7,249,750

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable and accrued liabilities	$	874,388		$	717,469
Note payable		85,000			85,000
Current portion of note payable -related party		925,416			868,361
Current portion of convertible notes payable, net of discount of $405,560 and $148,069		2,039,410			1,934,932
Investor payable - common shares		658,000			658,000
Preferred shares payable		-			13,438
Contingent consideration		1,000,000			1,000,000
Due to related parties		228,724			27,942
Other current liabilities		9,820			-
Derivative liabilities		881,447			620,237
Total Current Liabilities		6,702,205			5,925,379

Long-Term Liabilities
Convertible note payable, net of discount $5,527 and $56,358		39,973			10,307
Note payable -related party		55,556			388,889
TOTAL LIABILITIES		6,797,734			6,324,575
Series C Convertible Preferred stock, $0.001 par value, 100 shares designated; 14 shares issued and outstanding, respectively		14,000,000			14,000,000
Series D Convertible Preferred stock, $0.001 par value, 1,000 shares designated; 1 and 0 share issued and outstanding, respectively		100,000			-
		14,100,000			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, 1,400,000,000 shares authorized; 441,010,533 and 261,863,258 shares issued and outstanding, respectively		441,010			261,863
Additional paid in capital		1,594,420			670,962
Accumulated deficit		(16,029,361	)		(14,057,651	)
Total Stockholders' Deficit		(13,925,742	)		(13,074,825	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	6,971,992		$	7,249,750

~~(Unaudited)~~ The accompanying notes are an integral part of these unaudited consolidated financial statements.

April 30, January 31,
2016 2016
ASSETS
Current Assets
Cash and cash equivalents $ 95,669 $ 64,944
Accounts receivable 120,537 45,721
Marketable securities - available for sale 96,000 78,300
Deposit - CipherLoc 562,500 562,500
Prepaid and other current assets 32,200 32,200
Total Current Assets 906,906 783,665
Equipment, net of depreciation of $88,488 and $73,740 88,487 103,235
Intangible assets and proprietary technology, net of amortization $528,716 and $312,173 2,069,802 2,286,345
Goodwill 4,076,505 4,076,505
TOTAL ASSETS $ 7,141,700 $ 7,249,750
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable and accrued liabilities $ 813,030 $ 717,469
Note payable 85,000 85,000
Current portion of note payable -related party 933,917 868,361
Current portion of convertible notes payable, net of discount $297,353 and $148,069 1,875,222 1,934,932
Investor payable - common shares 658,000 658,000
Preferred shares payable - 13,438
Contingent Consideration 1,000,000 1,000,000
Due to related parties 164,439 27,942
Derivative liabilities 670,645 620,237
Total Current Liabilities 6,200,253 5,925,379
Long-Term Liabilities
Convertible note payable, net of discount $6,517 and $56,358 38,983 10,307
Note payable -related party 222,222 388,889
TOTAL LIABILITIES 6,461,458 6,324,575
Stockholders' Equity
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 issued and outstanding 1 1
Series B Preferred stock, $0.001 par value, 95,000,000 shares designated; 68,187,500 and 50,000,000 issued and outstanding, respectively 68,188 50,000
Series C Preferred stock, $0.001 par value, 100 shares designated; 14 issued and outstanding, respectively - -
Common stock, $0.001 par value, 1,400,000,000 shares authorized; 342,254,092 and 261,863,258 issued and outstanding, respectively 342,254 261,863
Additional paid in capital 15,141,263 14,670,962
Accumulated deficit (14,871,464 ) (14,057,651 )
Total Stockholders' Equity 680,242 925,175
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 7,141,700 $ 7,249,750

3
Table of Contents

GAWK INCORPORATED

~~The~~CONSOLIDATED ~~accompanying~~STATEMENTS ~~notes~~OF ~~are~~OPERATIONS anAND ~~integral~~COMPREHENSIVE ~~part~~INCOME ~~of these unaudited consolidated financial statements.~~(LOSS)

3(Unaudited)

Table of Contents

	For the Three Months Ended July 31,						For the Six Months Ended July 31,
	2016			2015			2016			2015

Revenue	$	1,319,429		$	558,079		$	2,780,082		$	616,661
Cost of revenue		933,830			392,629			1,988,863			392,629
Gross profit		385,599			165,450			791,219			224,032

Operating expenses
General and administration		796,429			265,999			1,321,669			570,275
Research and development		-			2,500			-			2,500
Depreciation and amortization		231,293			93,278			462,584			144,775
Total operating expenses		1,027,722			361,777			1,784,253			717,550

Net loss from operations		(642,123	)		(196,327	)		(993,034	)		(493,518	)

Other income (expense)
Other income		4,678			-			10,286			-
Interest expense, net		(178,144	)		(45,606	)		(338,115	)		(90,203	)
Amortization of debt discount and deferred financing fees		(295,269	)		(89,550	)		(566,618	)		(179,100	)
Unrealized gain (loss) on marketable securities		(300	)		75,000			17,400			181,050
Change in fair value of derivative liabilities		(46,739	)		-			(101,629	)		-
Total other expense		(515,774	)		(60,156	)		(978,676	)		(88,253	)

Net loss		(1,157,897	)		(256,483	)	$	(1,971,710	)	$	(581,771	)

Other comprehensive income		-			442			-			442

Comprehensive Loss	$	(1,157,897	)	$	(256,041	)	$	(1,971,710	)	$	(581,329	)

Basic and dilutive loss per common share	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.00	)

Weighted average number of common shares outstanding		388,995,621			179,496,982			344,531,928			176,083,946

~~GAWK~~The ~~INCORPORATED~~accompanying notes are an integral part of these unaudited consolidated financial statements.

~~CONSOLIDATED~~4 ~~STATEMENTS~~Table OFof ~~OPERATIONS~~Contents

GAWK INCORPORATED

~~(Unaudited)~~CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the Three Months Ended April 30,
	2016			2015
Revenue	$	1,460,653		$	58,582
Cost of revenue		1,055,033			-
Gross profit		405,620			58,582
Operating Expenses
General and administration		525,240			304,276
Depreciation and amortization		231,291			51,497
Total operating expenses		756,531			355,773
Net loss from operations		(350,911	)		(297,191	)
Other income (expense)
Other income		5,608			-
Interest expense, net		(431,320	)		(134,147	)
Unrealized gain on marketable securities		17,700			106,050
Change in fair value of derivative liabilities		(54,890	)		-
Total other expense		(462,902	)		(28,097	)
Net loss	$	(813,813	)	$	(325,288	)
Basic and dilutive loss per common share	$	(0.00	)	$	(0.00	)
Weighted average number of common shares outstanding		298,186,922			172,555,864

(Unaudited)

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

	For the Six Months Ended July 31,
	2016			2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(1,971,710	)	$	(581,771	)
Adjustments to reconcile net loss to net cash used in operating activities:
Common stock issued for services		-			57,083
Common stock options issued for services		177,000			-
Common stock issued for legal settlement		-			54,000
Stock-based compensation		61,157			-
Amortization of debt discount and deferred financing fees		566,618			179,100
Unrealized gain on marketable securities		(17,400	)		(181,050	)
Depreciation and amortization		462,583			144,775
Change in fair value of derivative liabilities		101,629			-
Changes in operating assets and liabilities:
(Increase) decrease in operating assets:
Accounts receivable		(48,572	)		4,829
Increase (decrease) in operating liabilities:
Accounts payable and accrued liabilities		188,238			90,206
Due to related parties		200,782			38,724
Other current liabilities		1,300			-
Net Cash Used In Operating Activities		(278,375	)		(194,104	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of XTELUS, net of cash acquired		397			-
Net cash paid for acquisition of Net D’s assets		-			(65,000	)
Net Cash Provided by (Used in) Investing Activities		397			(65,000	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from convertible notes, net of original issue discounts and deferred financing fees		557,579			25,000
Proceeds from notes payable - related party		25,000			-
Payment of notes payable - related party		(301,278	)		-
Payment of convertible notes payable		(33,333	)		-
Proceeds from issuance of Series B Preferred stock		20,000			17,500
Proceeds from issuance of common stock		-			5,000
Net Cash Provided By Financing Activities		267,968			47,500

Effect of exchange rate changes		-			442

Net decrease in cash and cash equivalents		(10,010	)		(211,162	)
Cash and cash equivalents, beginning of period		64,944			255,455
Cash and cash equivalents, end of period	$	54,934		$	44,293

Supplemental cash flow information
Cash paid for interest	$	183,923		$	-
Cash paid for taxes	$	-		$	-

Non-cash financing transactions:
Acquisition of XTELUS through issuance of preferred shares	$	100,000		$	-
Series B Preferred shares issued to settle preferred share payable	$	13,438		$	-
Preferred share payable for preferred C stock	$	-		$	1,000,000
Acquisition of goodwill	$	-		$	3,554,622
Issuance of preferred shares payable for acquisition	$	-		$	2,000,000
Issuance of investor payable for acquisition	$	-		$	1,556,000
Issuance of common stock for conversion of debt and accrued interest	$	336,007		$	-
Common stock issued in exchange for warrants	$	24,000		$	206,000
Intangible assets assumed from acquisition	$	-		$	351,378
Accounts payable assumed from acquisition	$	-		$	85,000
Debt discount from derivative liability	$	672,772		$	-
Note payable assumed from acquisition	$	-		$	350,000
Derivative resolution	$	690,191		$	-
Accrued interest added to principal	$	1,159		$	-
Convertible note issued for prepayment penalty	$	31,438		$	-

4The accompanying notes are an integral part of these unaudited consolidated financial statements.

5 Table of Contents

GAWK INCORPORATED

~~CONSOLIDATED~~NOTES ~~STATEMENTS~~TO OFUNAUDITED ~~CASH~~CONSOLIDATED ~~FLOWS~~FINANCIAL STATEMENTS

~~(Unaudited)~~July 31, 2016

	For the Three Months Ended April 30,
	2016			2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(813,813	)	$	(325,288	)
Adjustments to reconcile net loss to net cash used in operating activities:
Common stock and warrants issued for services		-			57,083
Common stock issued for legal settlement		-			54,000
Amortization of debt discount and deferred financing fees		271,349			89,550
Unrealized gain on marketable securities		(17,700	)		(106,050	)
Depreciation and amortization		231,291			51,497
Change in fair value of derivative liabilities		54,890			-
Changes in operating assets and liabilities:
(Increase) decrease in operating assets:
Accounts receivable		(74,816	)		5,053
Increase (decrease) in operating liabilities:
Accounts payable and accrued liabilities		112,355			44,599
Due to related parties		136,497			-
Net Cash Used In Operating Activities		(99,947	)		(129,556	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net Cash (Used in) Investing Activities		-			-
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from convertible notes, net of discounts and deferred financing fees		245,116			-
Payment of notes payable - related party, net		(101,111	)		-
Payment of convertible notes payable		(33,333	)		-
Proceeds from issuance of Series B Preferred stock		20,000			-
Net Cash Provided By Financing Activities		130,672			-
Net increase (decrease) in cash and cash equivalents		30,725			(129,556	)
Cash and cash equivalents, beginning of period		64,944			255,455
Cash and cash equivalents, end of period	$	95,669		$	125,899
Supplemental cash flow information
Cash paid for interest	$	100,834		$	-
Cash paid for taxes	$	-		$	-
Non-cash financing transactions:
Series C Preferred shares issued to settle preferred share payable	$	13,438		$	-
Preferred shares payable for acquisition	$	-		$	1,000,000
Issuance of common stock for conversion of debt and accrued interest	$	205,965		$	-
Debt discount from derivative liability	$	324,995		$	-
Derivative resolution - conversion	$	329,477		$	-
Accrued interest added to principal	$	1,159		$	-

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 ~~accompanying~~Company ~~notes~~offers ~~are~~a ansuite ~~integral~~of ~~part~~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 ~~these~~advanced ~~unaudited~~data ~~consolidated~~center ~~financial~~and ~~statements~~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

5NOTE 2 - BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS

~~Table~~Basis of ~~Contents~~Presentation of Interim Financial Statements

~~GAWK~~The ~~INCORPORATED~~accompanying interim unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. In our opinion, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the six months ended July 31, 2016 are not necessarily indicative of the results that may be expected for the year ending January 31, 2017. Notes to the unaudited interim consolidated financial statements that would substantially duplicate the disclosures contained in the audited consolidated financial statements for fiscal year 2016 have been omitted. This report should be read in conjunction with the audited consolidated financial statements and the footnotes thereto for the fiscal year ended January 31, 2016 included in the Company’s Form 10-K as filed with the Securities and Exchange Commission on May 24, 2016.

~~NOTES~~Use TOof ~~UNAUDITED~~Estimates ~~CONSOLIDATED~~and ~~FINANCIAL STATEMENTS~~Assumptions

~~April~~The 30preparation 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, ~~2016~~(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.

~~NOTE 1 - DESCRIPTION OF BUSINESS~~Reclassifications

~~Gawk~~Certain ~~Incorporated~~amounts ~~(“we”, “our”, the “Company”) was incorporated~~ in the ~~state~~fiscal of2016 ~~Nevada~~financial onstatements ~~January~~have 6,been ~~2011~~reclassified 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,~~conform ~~medium, and large businesses; and offers domestic and international voice services~~ to ~~communications~~the ~~carriers~~fiscal ~~worldwide.~~2017 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 securitypresentation. ~~Our website is located at www.gawkinc.com~~

~~NOTE~~Revenue ~~2 - BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS~~Recognition

~~Basis~~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 ~~Presentation~~the following criteria are met: (i) persuasive evidence of ~~Interim~~an ~~Financial~~arrangement ~~Statements~~exists, (ii) the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured.

~~The~~6 ~~accompanying~~Table interim unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. In our opinion, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three months ended April 30, 2016 are not necessarily indicative of the results that may be expected for the year ending January 31, 2017. Notes to the unaudited interim consolidated financial statements that would substantially duplicate the disclosures contained in the audited consolidated financial statements for fiscal year 2016 have been omitted. This report should be read in conjunction with the audited consolidated financial statements and the footnotes thereto for the fiscal year ended January 31, 2016 included in the Company’s Form 10-K as filed with the Securities and Exchange Commission on May 24, 2016.Contents

~~Use~~Our Business Services revenue includes monthly recurring charges (“MRC”) to customers, for whom charges are contracted over a specified period of ~~Estimates~~time, and ~~Assumptions~~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.

~~The~~Our ~~preparation~~Carrier ofServices ~~financial~~revenue ~~statements~~is inprimarily ~~conformity~~derived ~~with~~from ~~accounting~~usage ~~principles~~fees ~~generally~~charged ~~accepted~~to inother ~~the~~carriers ~~United~~that ~~States~~terminate ~~("GAAP")~~voice ~~requires~~traffic ~~management~~over toour ~~make~~network. ~~estimates~~Variable ~~and~~revenue ~~assumptions~~is ~~that~~earned ~~affect~~based ~~(i)~~ on the ~~reported~~length ~~amounts~~ of ~~assets~~a ~~and liabilities~~call, ~~(ii)~~ as measured by the ~~disclosure~~number of ~~contingent~~minutes ~~assets~~of ~~and~~duration. ~~liabilities~~It ~~known~~is torecognized ~~exist~~upon ascompletion of the ~~date~~call, ~~the~~and ~~financial~~is ~~statements~~adjusted ~~are~~to ~~published,~~reflect ~~and (iii)~~ the ~~reported~~allowance ~~amount~~for ofbilling ~~net~~adjustments. ~~revenues~~Revenue ~~and~~for ~~expenses~~each ~~recognized~~customer ~~during~~is ~~the~~calculated ~~periods~~from ~~presented~~information received through our network switches. ~~Adjustments~~Our ~~made~~customized ~~with~~software ~~respect~~tracks tothe information from the ~~use~~switches ofand ~~estimates~~analyzes ~~often~~the ~~relate~~call todetail ~~improved~~records against stored detailed information ~~not~~about ~~previously~~revenue ~~available~~rates. ~~Uncertainties~~This software provides us with ~~respect~~the ability to ~~such~~complete ~~estimates~~a timely and ~~assumptions~~accurate ~~are~~analysis ~~inherent~~of revenue earned in a period. We believe that the ~~preparation~~nature of ~~financial~~this ~~statements;~~process ~~accordingly,~~is ~~actual~~such ~~results~~that ~~could~~recorded ~~differ~~revenues ~~from~~are ~~these~~unlikely ~~estimates~~to be revised in future periods.

~~Revenue~~Fair ~~Recognition~~Value of Financial Instruments

The Company's ~~pursues~~financial ~~opportunities~~instruments toconsist ~~realize~~primarily ~~revenues~~of ~~from~~cash, ~~consulting~~accounts ~~services.~~receivable, Itaccounts ispayable ~~the company’s policy that revenues~~ and ~~gains~~accrued ~~will be recognized in accordance with ASC Topic 605-10-25~~liabilities, ~~“Revenue~~and ~~Recognition~~debt.” ~~Under~~The ~~ASC~~carrying ~~Topic~~amounts ~~605-10-25, revenue earning activities are recognized when all~~ of ~~the~~such ~~following~~financial ~~criteria~~instruments ~~are~~approximate ~~met:~~their ~~(i)~~respective ~~persuasive~~estimated ~~evidence~~fair ofvalue andue ~~arrangement exists, (ii) the services have been rendered~~ to the ~~customer,~~short-term ~~(iii)~~maturities ~~the~~and ~~sales~~approximate ~~price~~market isinterest ~~fixed~~rates orof ~~determinable,~~these ~~and (iv) collectability is reasonably assured~~instruments.

~~Our~~The ~~Business~~Company ~~Services~~adopted ~~revenue~~ASC ~~includes~~Topic ~~monthly~~820, “Fair ~~recurring~~Value ~~charges (“MRC~~Measurements,”) towhich ~~customers~~defines fair value, establishes a framework for ~~whom~~measuring ~~charges~~fair ~~are~~value, ~~contracted~~and ~~over~~expands disclosures about fair value measurements. The standard provides a ~~specified~~consistent ~~period~~definition of ~~time,~~fair ~~and~~value ~~variable~~which ~~usage~~focuses ~~fees~~on ~~charged~~an toexit ~~customers~~price that ~~purchase~~would ~~our~~be ~~business~~received ~~products~~upon ~~and~~sale ~~services.~~of ~~Revenue~~an ~~recognition~~asset ~~commences~~or ~~after~~paid ~~the~~to ~~provisioning,~~transfer ~~testing~~a ~~and~~liability ~~acceptance~~in ofan ~~the~~orderly ~~service~~transaction bybetween ~~the~~market ~~customer.~~participants ~~MRCs~~at ~~continue~~the ~~until~~measurement ~~the~~date. ~~expiration~~The ofstandard ~~the~~also ~~contract~~prioritizes, orwithin ~~until~~the ~~cancellation~~measurement of ~~the~~fair ~~service~~value, by the ~~customer.~~use Toof ~~the~~market-based ~~extent~~information ~~that~~over ~~payments~~entity ~~received~~specific ~~from~~information aand ~~customer~~establishes ~~are~~a ~~related~~three-level tohierarchy afor ~~future~~fair ~~period,~~value ~~the~~measurements ~~payment~~based ison ~~recorded~~the asnature ~~deferred~~of ~~revenue~~inputs ~~until~~used in the ~~service~~valuation isof ~~provided~~an asset or liability as of the ~~usage~~measurement ~~occurs~~date.

6The three-level hierarchy for fair value measurements is defined as follows:

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

~~Our~~· ~~Carrier~~Level ~~Services~~2 ~~revenue~~- isinputs ~~primarily derived from usage fees charged~~ to ~~other carriers that terminate voice traffic over our network. Variable revenue is earned based on~~ the ~~length~~valuation ofmethodology ainclude ~~call,~~quoted asprices ~~measured~~for bysimilar ~~the~~assets ~~number~~and ofliabilities ~~minutes~~in ofactive ~~duration. It is recognized upon completion of the call~~markets, and isinputs ~~adjusted~~that toare ~~reflect~~observable ~~the allowance~~ for ~~billing adjustments. Revenue for each customer is calculated from information received through our network switches. Our customized software tracks~~ the ~~information~~asset ~~from~~or ~~the~~liability ~~switches~~other ~~and~~than ~~analyzes~~quoted ~~the~~prices, ~~call~~either ~~detail~~directly ~~records~~or ~~against~~indirectly, ~~stored~~including ~~detailed~~inputs ~~information~~in ~~about~~markets ~~revenue~~that ~~rates.~~are ~~This~~not ~~software~~considered ~~provides us with the ability~~ to ~~complete~~be aactive; ~~timely~~or ~~and~~directly ~~accurate~~or ~~analysis~~indirectly ofincluding ~~revenue~~inputs ~~earned~~ in amarkets ~~period. We believe~~ that ~~the nature of this process is such that recorded revenues~~ are ~~unlikely~~not considered to be ~~revised in future periods.~~active;

~~Fair~~· ~~Value~~Level of3 ~~Financial~~- ~~Instruments~~inputs to the valuation methodology are unobservable and significant to the fair value measurement

The ~~Company's financial instruments consist~~following ~~primarily~~table ofsummarizes ~~cash,~~fair ~~accounts~~value ~~receivable,~~measurements ~~accounts payable~~by ~~and accrued liabilities, and~~level ~~debt. The carrying amounts~~at ofJuly ~~such financial instruments approximate~~31, ~~their~~2016 ~~respective estimated~~and ~~fair~~January ~~value~~31, ~~due~~2016 tomeasured ~~the~~at ~~short-term maturities~~fair ~~and~~value ~~approximate~~on ~~market~~a ~~interest~~recurring ~~rates of these instruments.~~ basis:

~~The~~Carrying ~~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~~July ~~measurement date. The standard also prioritizes~~31, 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.2016

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

July 31, 2016	Level 1		Level 2		Level 3		Total
Marketable securities- available for sale		95,700		-		-		95,700
Total assets		95,700		-		-		95,700

Derivative liabilities		-		-		881,447		881,447
Total liabilities		-		-		881,447		881,447

·7 ~~Level~~Table 1of ~~– inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; liabilities in active markets;~~Contents

·Carrying ~~Level~~Value 2at –January ~~inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets~~31, 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;2016

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

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

~~The~~Recent ~~following~~Accounting ~~table summarizes fair value measurements by level at April 30, 2016 and January 31, 2016 measured at fair value on a recurring basis:~~Pronouncements

~~Carrying~~No ~~Value~~accounting atstandards ~~April~~or 30interpretations issued recently are expected to a have a material impact on the Company's financial position, ~~2016~~operations or cash flows.

April 30, 2016	Level 1		Level 2		Level 3		Total
Marketable securities - available for sale		96,000		-		-		96,000
Total assets		96,000		-		-		96,000
Derivative liabilities		-		-		670,645		670,645
Total liabilities		-		-		670,645		670,645

NOTE 3 - GOING CONCERN

~~Carrying~~The ~~Value~~accompanying atfinancial ~~January~~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 a net loss for the six months ended July 31, 2016 of $1,971,710, an accumulated deficit of $16,029,361, cash flows used in operating activities of $278,375 and needs additional cash to maintain its operations.

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

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.

7NOTE 4 - ACQUISITION

~~Table~~On June 27, 2016, the Company entered into an acquisition agreement with NEOGEN Holdings LLC, whereby the Company acquired 100% of ~~Contents~~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.

~~Recent~~Management ~~Accounting~~determined ~~Pronouncements~~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.

NoThe ~~accounting~~purchase ~~standards~~price orpaid ~~interpretations~~for ~~issued~~the ~~recently~~acquisition ~~are~~of ~~expected~~XTELUS amounted to a$100,000 ~~have~~and aconsisted ~~material~~of ~~impact~~1 onSeries ~~the~~D ~~Company's~~Preferred ~~financial~~Stock, ~~position~~which is convertible into $100,000 ~~operations~~of orcommon ~~cash~~shares ~~flows~~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:

NOTE 3 - GOING CONCERN

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

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

~~The~~8 ~~accompanying~~Table ~~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 a net loss for the three months ended April 30, 2016 of $813,813, an accumulated deficit of $14,871,464, cash flows used in operating activities of $99,947 and needs additional cash to maintain its operations.Contents

~~These~~Revenues ~~factors~~of ~~raise~~$135,515 ~~substantial~~and ~~doubt~~net ~~about~~loss ~~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~~$11,033 ~~continued~~since ~~contributions from~~ the ~~Company's~~acquisition ~~executive~~date ~~officers~~are toincluded ~~finance~~in ~~its operations and~~ the ~~ability~~consolidated tostatements ~~obtain~~of ~~additional~~operations ~~funding sources to explore potential strategic relationships~~ and tocomprehensive ~~provide~~income ~~capital~~(loss) ~~and other resources~~ for the ~~further~~six ~~development~~months ~~and~~ended ~~marketing~~July of31, ~~the Company's products and business~~2016.

~~NOTE~~Unaudited ~~4 - NOTES~~proforma ~~PAYABLE~~results of operations for the six months ended July 31, 2016 and 2015 as though the Company acquired XTELUS on the first day of each fiscal year are set forth below:

The Company had the following notes payable and notes payable – related party outstanding as of April 30, 2016 and January 31, 2016:

	Six months ended July 31,
	2016			2015
Revenues	$	3,196,291		$	616,661
Cost of revenues		2,308,701			393,215
Gross profit		887,590			223,446

Operating expenses		1,954,785			717,550
Operating loss		(1,067,195	)		(494,104	)

Other expense		(978,676	)		(88,253	)

Net Loss	$	(2,045,871	)	$	(582,357	)

Note Payable
	April 30, 2016			January, 31, 2016
Dated – October 30, 2014	$	10,000		$	10,000
Dated – June 3, 2015		25,000			25,000
Dated – December 11, 2015		50,000			50,000
Total notes payable		85,000			85,000
Less: current portion of notes payable		(85,000	)		(85,000	)
Long-term notes payable	$	-		$	-

NOTE 5 - NOTES PAYABLE

~~Dated~~The –Company ~~October~~had 30the following notes payable and notes payable - related party outstanding as of July 31, ~~2014~~2016 and January 31, 2016:

OnNotes 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.Payable

Dated – June 3, 2015 and December 11, 2015

	July 31, 2016		January, 31, 2016
Dated - October 30, 2014	$	10,000	$	10,000
Dated - June 3, 2015		25,000		25,000
Dated - December 11, 2015		50,000		50,000
Total notes payable	$	85,000	$	85,000
Less: current portion of notes payable		85,000		85,000
Long-term notes payable		-		-

~~The~~Dated ~~two~~- ~~notes~~October ~~were issued to Mr. Doyle Knudson~~30, ~~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 and is currently past due.~~ 2014

8On 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.

~~Table~~Dated of- ~~Contents~~June 3, 2015 and December 11, 2015

Note Payable - related party
	April 30, 2016			January, 31, 2016
Dated – April 23, 2015	$	267,250		$	282,250
Dated - January 18, 2016		888,889			975,000
Total notes payable		1,156,139			1,257,250
Less: current portion of notes payable		(933,917	)		(868,361	)
Long-term notes payable	$	222,222		$	388,889

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 and is currently past due.

~~Dated~~9 –Table ~~April~~of ~~23, 2015~~ Contents

OnNotes ~~May~~Payable 1,- ~~2015,~~related 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 $15,000 during the three months ended April 30, 2016.party

Dated – January 18, 2016

	July 31, 2016		January, 31, 2016
Dated - April 23, 2015	$	258,750	$	282,250
Dated - January 18, 2016		722,222		975,000
Total notes payable		980,972		1,257,250
Less: current portion of notes payable		925,416		868,361
Long-term notes payable	$	55,556	$	388,889

OnDated ~~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 paid principal and interest payments of $127,612 for the three months ended April 3023, ~~2016.~~2015

~~NOTE~~On ~~5 -~~May ~~CONVERTIBLE~~1, ~~NOTES~~2015, ~~PAYABLE~~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 $23,500 during the six months ended July 31, 2016.

~~The~~Dated ~~Company~~- ~~had the following convertible notes payable outstanding as of April 30, 2016 and~~ January 3118, 2016:

	April 30, 2016			January, 31, 2016
Dated – August 22, 2014	$	1,700,000		$	1,700,000
Dated – July 31, 2015		-			65,000
Dated - August 12, 2015 and December 15, 2015		-			66,666
Dated - August 18, 2015		-			38,000
Dated - September 29, 2015		-			27,500
Dated - October 7, 2015		-			26,500
Dated - October 26, 2015		29,659			28,500
Dated - November 6, 2015		34,000			34,000
Dated - November 18, 2015		50,000			50,000
Dated - December 29, 2015		35,000			35,000
Dated - January 4, 2016		40,000			40,000
Dated - January 20, 2016		38,500			38,500
Dated - February 9, 2016		43,171			-
Dated - February 24, 2016		30,877			-
Dated - March 2, 2016		57,000			-
Dated - March 29, 2016		35,380			-
Dated - April 4, 2016 – (two notes)		43,222			-
Dated - April 21, 2016		28,500			-
Dated - April 27, 2016		45,500			-
Dated - April 27, 2016		7,266			-
Total convertible notes payable		2,218,075			2,149,666
Less: debt discount and deferred financing fees		(303,870	)		(204,427	)
		1,914,205			1,945,239
Less: current portion of convertible notes payable		1,875,222			1,934,932
Long-term convertible notes payable	$	38,983		$	10,307

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 paid principal and interest payments of $319,029 for the six months ended July 31, 2016.

9NOTE 6 - CONVERTIBLE NOTES PAYABLE

~~Table~~The Company had the following convertible notes payable outstanding as of ~~Contents~~July 31, 2016 and January 31, 2016:

The Company recognized amortization expense related to the debt discount and deferred financing fees of $271,349 and $89,550 for the three months ended April 30, 2016 and 2015, respectively, which are included in interest expense in the consolidated statements of operations.

	July 31, 2016			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.		129,444			449,666
Promissory notes - Issued in fiscal year 2017, with variable conversion features.		661,026			-
Total convertible notes payable		2,490,470			2,149,666
Less: debt discount and deferred financing fees		(411,087	)		(204,427	)
		2,079,383			1,945,239
Less: current portion of convertible notes payable		2,039,410			1,934,932
Long-term convertible notes payable	$	39,973		$	10,307

~~Dated~~The –Company ~~August~~recognized 22amortization expense related to the debt discount and deferred financing fees of $566,618 ~~2014~~and $179,100 for the six months ended July 31, 2016 and 2015, respectively.

InPromissory ~~connection~~Note ~~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 conversion price of $0.10 per share. The note is subject to annual interest of 10%, matured in August ~~2015 and is currently past due. In May and December 2015~~22, ~~a total of $100,000 note principal was transferred to another lender.~~2014

~~The~~In ~~Company~~connection ~~recorded~~with athe ~~discount~~settlement onagreement entered into with Doyle Knudson, an investor, in 2014, the Company issued a $1.8 million convertible promissory note ~~due~~with to a ~~beneficial~~fixed conversion ~~feature~~price of $~~358~~0.10 per share or 17,~~200~~000,000 ~~and~~shares ~~amortized~~of $0common ~~and~~stock. ~~$89,550~~The ~~for~~note ~~the~~is ~~three~~subject ~~months~~to ~~ended~~annual ~~April~~interest 30of 10%, ~~2016~~matured in August 2015 and is currently past due. In May and December 2015, ~~respectively~~a total of $100,000 note principal was transferred to another lender.

~~Dated~~10 –Table ~~Issued~~of ~~in fiscal year 2016~~Contents

~~During~~Due to the ~~year~~variable ~~ended~~conversion ~~January~~rates 31in the other convertible notes (see below), ~~2016~~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. The Company ~~issued~~recorded a ~~total~~discount on the convertible note due to a beneficial conversion feature of $~~449~~358,~~666~~200 ~~notes~~and ~~with~~amortized $0 and $179,100 for the ~~following~~six ~~terms:~~months ended July 31, 2016 and 2015, respectively.

·Promissory ~~Terms~~Notes ~~ranging~~- ~~from~~Issued 9in ~~months~~fiscal toyear ~~2 years~~2016

·During ~~Annual~~the ~~interest~~year ~~rates~~ended ~~ranging~~January ~~from~~31, 5%2016, tothe ~~12%~~Company issued a total of $449,666 notes with the following terms:

· ~~Convertible~~Terms atranging ~~the option of the holders either at issuance or180 days~~ from ~~issuance.~~9 ~~The~~months ~~note~~to ~~dated~~2 ~~September 29, 2015 is convertible at the later of the maturity date or date of default.~~years

· ~~Conversion~~Annual ~~prices~~interest ~~are~~rates ~~typically~~ranging ~~based~~from ~~on the discounted (50~~5% to 6012% 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~~Convertible ~~allow~~at the ~~Company~~option toof ~~redeem~~ the ~~notes~~holders either at ~~rates~~issuance ~~ranging~~or ~~from~~180 ~~118%~~days tofrom ~~148%~~issuance. ~~depending~~The onnote ~~the~~dated ~~redemption~~September ~~date~~29, ~~provided~~2015 ~~that no redemption~~ is ~~allowed~~convertible ~~after~~at the ~~180th day. Likewise,~~later ~~certain~~of ~~notes include original issue discounts totaling to $24,166. During~~ the ~~year~~maturity ~~ended~~date ~~January~~or ~~31,~~date ~~2016,~~of ~~the Company also recognized deferred financing fees totaling $55,142~~default.

~~The~~· ~~Company~~Conversion ~~determined~~prices ~~that~~are ~~the~~typically ~~conversion~~based ~~feature~~on ~~met~~ the ~~definition~~discounted of(50% ato ~~liability~~60% indiscount) ~~accordance~~lowest ~~with~~trading ~~ASC~~prices ~~Topic~~of ~~No.~~the ~~815 - 40, Derivatives and Hedging - Contracts in Entity'~~Company’s ~~Own~~shares ~~Stock~~during ~~and~~various ~~therefore~~periods ~~bifurcated~~prior ~~the~~to ~~embedded~~ conversion. ~~option~~Certain ~~once~~notes ~~the~~allow ~~note becomes convertible and accounted~~ for ~~it as a derivative liability. The fair value of~~ the conversion ~~feature~~price ~~was~~to ~~recorded~~be asthe alower ~~debt~~of ~~discount~~$0.01 ~~and~~or ~~amortized to interest expense over~~ the ~~term~~discounted oftrading ~~the note.~~price

~~The~~Certain ~~Company~~notes ~~valued~~allow the ~~conversion~~Company ~~feature~~to ~~using~~redeem the ~~Black~~notes ~~Scholes~~at ~~valuation~~rates ~~model.~~ranging ~~The~~from ~~fair~~118% ~~value~~to of148% ~~the~~depending ~~derivative~~on ~~liability~~the ~~for~~redemption ~~all~~date ~~the~~provided ~~notes~~ that ~~became~~no ~~convertible~~redemption ~~during~~is ~~the~~allowed ~~year~~after ~~amounted~~the to180th day. ~~$459~~Likewise,~~733. $209,000~~ ofcertain ~~the~~notes ~~value~~include ~~assigned~~original toissue ~~the~~discounts ~~derivative~~totaling ~~liability~~to ~~was~~$24,166. ~~recognized~~During asthe ayear ~~debt~~ended ~~discount~~January to31, ~~the~~2016, ~~notes while~~ the ~~balance~~Company ofalso ~~$250,733 was~~ recognized asdeferred afinancing ~~“day~~fees 1”totaling ~~derivative loss.~~$55,142

~~During~~The ~~the~~Company ~~three~~determined ~~months~~that ~~ended~~the ~~April~~conversion ~~30,~~feature ~~2016,~~met the ~~Company~~definition ~~repaid~~of ~~notes~~a liability in accordance with ~~principal~~ASC ~~amounts~~Topic ~~totaling~~No. to815 ~~$33~~- 40,~~333~~ Derivatives and ~~converted~~Hedging ~~notes~~- ~~with~~Contracts ~~principal~~in ~~amounts~~Entity's ofOwn ~~$190,333~~Stock and ~~accrued~~therefore ~~interest~~bifurcated ofthe ~~$15,632~~embedded ~~into~~conversion ~~80,390,834~~option ~~shares~~once ofthe ~~common~~note ~~stock.~~becomes ~~The~~convertible ~~corresponding~~and accounted for it as a derivative liability. atThe ~~the~~fair ~~date~~value of the conversion offeature ~~$329,477~~ was ~~credited~~recorded as a debt discount and amortized to ~~additional~~interest ~~paid~~expense inover ~~capital.~~the term of the note.

~~During~~The Company valued the ~~three~~conversion ~~months~~feature ~~ended~~using ~~April~~the ~~30,~~Black ~~2016,~~Scholes valuation model. The fair value of the ~~Company~~derivative ~~assigned~~liability 7for all the notes ~~with~~that ~~principal~~became ~~amounts~~convertible ~~totaling~~during the year amounted to $~~263~~459,733. $250,733 toof ~~one~~the ~~lender~~value ~~which~~assigned ~~resulted~~ to the ~~payment~~derivative ofliability ~~prepayment~~was ~~penalties~~recognized ~~amounting~~as a debt discount to the notes while the balance of $84209,~~995~~000 was recognized as a “day 1” derivative loss.

10During the six months ended July 31, 2016, the fair value of the derivative liability for all the notes that became convertible amounted to $327,870. $219,500 of the value assigned to the derivative liability was recognized as a debt discount to the notes while the balance of $108,370 was recognized as a “day 1” derivative loss.

~~Table~~During the six months ended July 31, 2016, the Company repaid notes with principal amounts totaling to $33,333 and converted notes with principal amounts of ~~Contents~~$288,048 and accrued interest of $19,060 into 138,633,561 shares of common stock. The corresponding derivative liability at the date of conversion of $521,861 was credited to additional paid in capital.

~~Dated~~During –the ~~Issued~~six inmonths ~~fiscal~~ended ~~year~~July ~~2017~~31, 2016, the Company assigned 10 notes with principal amounts totaling to $375,750 to one lender which resulted to the payment of prepayment penalties amounting to $142,672.

~~During~~Promissory ~~the~~Notes ~~three~~- ~~months~~Issued ~~ended~~in ~~April~~fiscal ~~30,~~year ~~2016, the Company issued a total of $290,917 notes with the following terms:~~2017

·During ~~Terms~~the ~~ranging~~six ~~from~~months 9ended ~~months~~July to31, 202016, ~~months~~the Company issued a total of $689,526 notes with the following terms:

· ~~Annual~~Terms ~~interest rates~~ ranging from 8%9 months to ~~12%~~20 months

· ~~Convertible~~Annual atinterest ~~the~~rates ~~option~~ranging offrom ~~the~~8% ~~holders~~to ~~either at issuance or 180 days from issuance.~~12%

· ~~Conversion~~Convertible ~~prices~~at ~~are typically based on~~ the ~~discounted~~option ~~(50% discount) lowest trading prices~~ of the ~~Company’s~~holders ~~shares~~either ~~during~~at ~~various~~issuance ~~periods~~or ~~prior~~180 todays ~~conversion.~~from ~~Certain notes allow for the conversion price to be a floor of $0~~issuance.~~0005 per share.~~

~~Certain~~· ~~notes~~Conversion ~~allow~~prices ~~the~~are ~~Company~~typically tobased ~~redeem~~on the ~~notes~~discounted ~~at rates ranging from 125~~(50% todiscount) ~~150%~~lowest ~~depending~~trading onprices ~~the~~of ~~redemption date provided that no redemption is allowed after~~ the ~~180th day. Likewise,~~Company’s ~~certain~~shares ~~notes~~during ~~include~~various ~~original~~periods ~~issue~~prior ~~discounts totaling~~ to ~~$26,050~~conversion. ~~During~~ ~~the~~Certain ~~three~~notes ~~months~~allow ~~ended~~for ~~April 30, 2016,~~ the ~~Company~~conversion ~~also~~price ~~recognized~~to ~~deferred~~be ~~financing~~a ~~fees~~floor ~~totaling~~of $~~19,750~~0.0005 per share.

~~The~~11 ~~Company~~Table ~~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.Contents

~~The~~Certain ~~Company~~notes ~~valued~~allow the ~~conversion~~Company ~~feature~~to ~~using~~redeem the ~~Black~~notes ~~Scholes~~at ~~valuation~~rates ~~model.~~ranging ~~The~~from ~~fair~~118% ~~value~~to of150% ~~the~~depending ~~derivative~~on ~~liability~~the ~~for~~redemption ~~all~~date ~~the~~provided ~~notes~~ that ~~became~~no ~~convertible~~redemption ~~during~~is allowed after the ~~three~~180th day. ~~months~~Likewise, ~~ended~~certain ~~April~~notes ~~30,~~include ~~2016~~original ~~amounted~~issue discounts totaling to $~~586~~54,~~215~~883. ~~$324,995~~ ofDuring the ~~value~~six ~~assigned~~months toended ~~the~~July ~~derivative~~31, ~~liability~~2016, ~~was recognized as a debt discount to~~ the ~~notes~~Company ~~while~~also ~~the balance of $261,220 was~~ recognized asdeferred afinancing ~~“day~~fees 1”totaling ~~derivative loss~~$45,625.

~~NOTE~~The 6 Company determined that the conversion feature met the definition of a liability in accordance with ASC Topic No. 815 - ~~DERIVATIVE~~ ~~LIABILITIES~~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 ~~analyzed~~valued the conversion ~~option~~feature ~~for~~using ~~derivative~~the ~~accounting~~Black ~~consideration~~Scholes ~~under~~valuation ~~ASC~~model. ~~815, Derivatives~~The ~~and~~fair ~~Hedging,~~value ~~and~~of ~~hedging,~~the ~~and~~derivative ~~determined~~liability for all the notes that became convertible during the ~~instrument~~six ~~should~~months beended ~~classified~~July as31, a2016 ~~liability~~amounted ~~since~~to ~~the~~$977,181. ~~conversion~~$453,272 ~~option~~of ~~becomes~~the ~~effective~~value atassigned ~~issuance~~to ~~resulting~~the inderivative ~~there~~liability ~~being~~was norecognized ~~explicit~~as ~~limit~~a debt discount to the ~~number~~notes ofwhile ~~shares~~the tobalance beof ~~delivered~~$523,909 ~~upon~~was ~~settlement~~recognized ofas ~~the~~a ~~above~~“day ~~conversion~~1” ~~options~~derivative loss.

~~ASC~~During ~~815~~the ~~requires~~six wemonths ~~assess~~ended July 31, 2016, the ~~fair~~Company ~~market~~converted ~~value~~notes ofwith ~~derivative~~principal ~~liability~~amounts atof ~~the~~$28,500 ~~end~~and accrued interest of ~~each~~$399 ~~reporting~~into ~~period~~16,513,714 ~~and~~shares ~~recognize~~of ~~any~~common ~~change~~stock. inThe corresponding derivative liability at the ~~fair~~date ~~market~~of ~~value~~conversion asof ~~other~~$74,312 ~~income~~was orcredited ~~expense~~to ~~item~~additional paid in capital.

~~The~~NOTE ~~Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Black~~7 -~~Scholes~~ DERIVATIVE pricing model to calculate the fair value as of April 30, 2016. 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 April 30, 2016 and January 31, 2016 valuations:LIABILITIES

	Three Months Ended			Year Ended
	April 30 ,2016			January 31, 2016
Expected term	0.23 - 1.50 years			0.4 - 2 years
Expected average volatility		126% - 296	%		249% - 328	%
Expected dividend yield		-			-
Risk-free interest rate		0.00% - 0.58	%		0.05% - 0.83	%

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.

11ASC 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.

~~Table~~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 ~~Contents~~July 31, 2016. 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 July 31, 2016 and January 31, 2016 valuations:

At April 30, 2016, the estimated fair values of the liabilities measured on a recurring basis are as follows:

	Six Months Ended			Year Ended
	July 31, 2016			January 31, 2016
Expected term	0.23 - 1.50 years			0.4 - 2 years
Expected average volatility	126% - 296		%	249% - 328		%
Expected dividend yield		-			-
Risk-free interest rate	0.20% - 071		%	0.05% - 0.83		%

April 30, 2016	Level 1		Level 2		Level 3		Total
Dated – August 22, 2014	$	-	$	-	$	62,900	$	62,900
Dated - October 26, 2015		-		-		41,625		41,625
Dated - December 29, 2015		-		-		67,660		67,660
Dated - January 20, 2016		-		-		72,365		72,365
Dated - February 9, 2016		-		-		68,974		68,974
Dated - February 24, 2016		-		-		50,237		50,237
Dated - March 2, 2016		-		-		93,983		93,983
Dated - March 29, 2016		-		-		63,440		63,440
Dated - April 4, 2016 (two notes)		-		-		79,021		79,021
Dated - April 21, 2016		-		-		38,821		38,821
Dated - April 27, 2016		-		-		13,655		13,655
Warrants dated - November 9		-		-		17,964		17,964
Total liabilities	$	-	$	-	$	670,645	$	670,645

At July 31, 2016, the estimated fair values of the liabilities measured on a recurring basis are as follows:

Fair Value Measurements Using Significant Observable Inputs (Level 3)
July 31, 2016	Level 1			Level 2		Level 3		Total
Balance - January 31, 2016	$	620,237
Promissory Note - Issued August 22, 2014	$	-		$	-	$	49,300	$	49,300
Addition of new derivatives recognized as debt discounts		324,995
Promissory Notes - Issued in fiscal year 2016		-			-		165,924		165,924
Addition of new derivatives recognized as loss on derivatives		261,220
Promissory Notes - Issued in fiscal year 2017		-			-		593,222		593,222
Derivatives settled upon conversion of debt		(329,477	)
Warrants -Issued in fiscal year 2016		-			-		9,201		9,201
Loss on change in fair value of the derivative		(206,330	)
Warrants -Issued in fiscal year 2017		-			-		63,800		63,800
Balance - April 30, 2016	$	670,645
Total liabilities	$	-		$	-	$	881,447	$	881,447

~~The~~12 ~~net~~Table ~~loss~~of ~~on derivatives during the three months ended April 30, 2016 and 2015 was $54,890 and $0, respectively.~~Contents

~~NOTE~~ The 7following -table ~~EQUITY~~summarizes the changes in the derivative liabilities during the six months ended July 31, 2016:

Preferred Stock

Fair Value Measurements Using Significant Observable Inputs (Level 3)

Balance - January 31, 2016	$	620,237
Addition of new derivatives recognized as debt discounts		672,772
Addition of new derivatives recognized as warrant compensation		177,000
Addition of new derivatives recognized as loss on derivatives		632,279
Derivatives settled upon conversion of debt and exercise of warrants		(690,191	)
Loss on change in fair value of the derivative		(530,650	)
Balance - July 31, 2016	$	881,447

~~Series~~The Anet ~~Preferred~~loss ~~Stock~~on derivatives during the six months ended July 31, 2016 and 2015 was $93,468 and $0, respectively.

~~There~~NOTE ~~were~~8 no- ~~issuances of the Series A Preferred Stock during the three months ended April 30, 2016~~ EQUITY

~~Series B Convertible~~ Preferred Stock

~~During the three months ended April 30, 2016, the Company issued~~ Series BA Preferred ~~shares, as follows:~~Stock

·There Onwere ~~December~~no ~~21,~~issuances ~~2015,~~of the ~~Company recorded preferred stock payable of $13,438 for 13,437,500~~ Series BA Preferred ~~shares~~Stock ~~related~~during to the ~~acquisition~~six ~~of the assets of Net D. During the three~~ months ended ~~April~~July 3031, 2016 ~~the Company issued 13,437,500 Series B Preferred shares to settle this payable.~~

·Series OnB ~~February~~Convertible 3,Preferred ~~2016, 4,750,000 shares were sold for cash of $20,000.~~Stock

12 During the six months ended July 31, 2016, the Company issued Series B Preferred shares, as follows:

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

~~Series~~· COn ~~Convertible~~February ~~Preferred~~3, ~~Stock~~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.

~~There were no issuances of the~~ Series C Convertible Preferred Stock ~~during the three months ended April 30, 2016.~~

~~Common~~There ~~stock~~were no issuances of the Series C Preferred Stock during the six months ended July 31, 2016.

~~During~~Series ~~the~~D ~~three~~Convertible ~~months~~Preferred ~~ended April 30, 2016, the Company issued common shares, as follows:~~Stock

·On 80June 23,~~390~~ 2016,~~834~~ ~~common~~pursuant ~~shares~~to ~~were~~its ~~issued~~Articles ~~for~~of Incorporation and Bylaws, the ~~conversion~~Board of ~~debt~~Directors ~~and~~of ~~accrued~~the ~~interest~~Company, unanimously approved the designation of ~~$205~~a new series of preferred stock,~~965~~ "Series D Convertible Preferred Stock.

~~Warrants~~Each share of the Series D Preferred Stock shall be convertible, at the option of the holder thereof and ~~Options~~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.

~~There~~13 ~~were~~Table noof ~~warrants or options that were granted and none that expired or were forfeited during the three months ended April 30, 2016.~~ Contents

~~The~~During ~~following~~six ~~table~~months ~~summarizes~~ended ~~information~~July ~~relating~~31, to2016, ~~outstanding~~the ~~and~~Company ~~exercisable~~issued ~~stock~~1 ~~options~~share as of ~~April~~Series 30D Preferred Stock with a fair value of $100,000 ~~2016:~~in connection with the acquisition of XTELUS (see Note 4).

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		3.50	$	0.10		9,100,000	$	0.10
	27,000,000		0.59	$	0.005		27,000,000	$	0.005
	36,100,000		1.32		0.03		36,100,000		0.03

As of July 31, 2016 and January 31, 2016, 1 and 0 shares of Series D Preferred Stock were issued and outstanding, respectively.

~~The~~Common ~~options have an intrinsic value at April 30, 2016 and January 31, 2016 of $0 and $59,400, respectively.~~stock

~~NOTE~~During ~~8 -~~the ~~RELATED~~six ~~PARTY~~months ~~TRANSACTIONS~~ended July 31, 2016, the Company issued common shares, as follows:

As of April 30, 2016 and January 31, 2016, the CEO had accrued salaries of $68,000 and $0, respectively.

	·	155,147,275 common shares were issued for the conversion of debt and accrued interest of $336,007.
	·	24,000,000 common shares in exchange for the exercise of options for no consideration

~~During~~Warrants ~~the three months ended April 30, 2016~~ and ~~2015, the CEO advanced the Company cash of $200 and $0, respectively. As of April 30, 2016 and January 31, 2016, the amount owed to the CEO for advances was $200 and $0, respectively.~~Options

As of April 30, 2016, the Company has outstanding notes payable to Net D totaling to $1,156,139 in connection with the Company’s acquisition of Connexum and certain assets of Net D. The sole owner of Net D is a director of the Company. Net D also performs certain services for the Company in connection with the latter’s Carrier Services business. During the period ended April 30, 2016, the Company incurred total fees in connection with such services of $33,822. Options

AsDuring ofsix ~~April~~months 30ended July 31, 2016, 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 ~~January~~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, ~~2016~~and September 30, 2016. These options were tainted as a result of the ~~Company~~convertible ~~owed~~notes ~~related~~with ~~parties~~variable ~~$164,439~~conversion rates (see Note 7) and were accounted for as derivative instruments at the time of issuance. The fair value of the options amounting to $27177,~~942~~000 was recorded as stock compensation expense during the six months ended July 31, ~~respectively~~2016, with a corresponding credit to derivative liability (see Note 7).

~~NOTE~~A ~~9 -~~summary ~~COMMITMENTS~~of ~~AND~~activity ~~CONTINGENCIES~~during the period ended July 31, 2016 follows:

Licensing Agreement / Deposit

	Options Outstanding
				Weighted Average
	Shares			Exercise Price

Outstanding, January 31, 2016		36,100,000		$	0.03
Granted		39,000,000			-
Exercised		(24,000,000	)		(0.0015	)
Forfeited/canceled		-			-
Outstanding, July 31, 2016		51,100,000		$	0.02

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 its name to Cipher Loc Corporation and ticker symbol to (CLOK) ("Cloud") for $1,125,000. The ~~agreement~~following ~~grants~~table tosummarizes usinformation arelating ~~non-exclusive encryption license agreement which entitles us~~ to ~~utilize~~outstanding 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~~exercisable ~~privacy~~stock ~~intrusion~~options ~~vehicles. CipherLoc~~as ~~has various features that will further protect our members and end users~~ of ~~our~~July ~~web developed platform. During the year ended January~~ 31, 2016, the Company wrote off 50% of the deposit amounting to $562,500 to impairment expense. As of April 30, 2016, the software has not been delivered to the Company and the remaining amount of $562,500 continues to be reported as a deposit in the consolidated balance sheet. :

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		3.25	$	0.10		9,100,000	$	0.10
20,000,000		0.34	$	0.005		27,000,000	$	0.005
5,000,000		0.08	$	-		5,000,000	$	-
17,000,000		0.17	$	-		17,000,000	$	-
51,100,000		0.77	$	0.02		51,100,000	$	0.02

~~Table~~The options have an intrinsic value at July 31, 2016 and January 31, 2016 of ~~Contents~~$63,800 and $59,400, respectively.

~~Contingency~~Employee Incentive Bonus Plan

~~Connexum~~On June 27, ~~LLC~~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 period ended July 31, 2016, the Company recognized stock based compensation of $61,157 under these awards, with a corresponding credit to additional paid in capital.

On14 ~~January~~Table ~~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”). The agreement also provided 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. The Company determined that Connexum will meet 80% of the anticipated revenue and has recognized the fair value of the contingent consideration of $1,000,000 both as of April 30, 2016 and January 31, 2016. Contents

~~Windstream~~NOTE ~~Holdings,~~9 - ~~Inc.~~RELATED PARTY TRANSACTIONS

AtAs ~~the time~~ of ~~acquisition~~July ~~of Connexum~~31, ~~Windstream~~2016 ~~Holdings, Inc. ("Windstream"), a provider of voice~~ and ~~data~~January ~~network communications~~31, ~~and managed services~~2016, ~~to businesses in~~ the ~~United~~CEO ~~States, claimed~~had ~~that~~accrued ~~Connexum~~salaries 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~~ $2098,000~~. 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~~0,~~000~~ ~~of disputed fees~~respectively. 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.

~~Tarpon~~During ~~Bay~~the ~~Partners~~six ~~LLC~~months ended July 31, 2016 and 2015, the CEO advanced the Company cash of $200 and $0, respectively. As of July 31, 2016 and January 31, 2016, the amount owed to the CEO for advances was $200 and $0, respectively.

OnAs ~~May~~of 26July 31, 2016, ~~Tarpon Bay Partners, LLC (“Tarpon Bay”) initiated action against~~ the Company ~~in New York State Supreme Court, case #652178/2016. Tarpon Bay~~ has ~~elected~~outstanding ~~for~~notes ~~summary~~payable ~~judgment~~to inNet ~~lieu~~D oftotaling ~~complaint.~~to ~~Tarpon Bay is claiming~~$980,972 ~~inter~~in ~~alia,~~connection ~~that~~with the Company’s ~~owes~~acquisition ~~$93,500~~of inConnexum ~~unpaid notes~~ and ~~services.~~certain ~~The~~assets ~~claims~~of ~~stems~~Net ~~from~~D. ~~intended~~The ~~transactions~~sole ~~the~~owner ~~Company~~of ~~was~~Net toD ~~enter~~is ~~with~~a ~~Tarpon~~director ~~Bay.~~and ~~Tarpon~~officer ~~Bay~~of ~~was to provide~~ the Company. ~~with~~Net ~~funding~~D ~~and~~also performs certain services ~~in exchange~~ for ~~promissory notes from~~ the Company. ~~The~~in ~~notes~~connection ~~were~~with ~~executed by~~ the ~~Company,~~latter’s ~~but~~Carrier ~~Tarpon~~Services ~~Bay~~business. ~~provided~~During nothe ~~funding~~period orended ~~services~~July ~~and~~31, is2016, ~~not entitled to repayment of any note given by~~ the Company. ~~The~~incurred ~~Company~~total ~~intends~~fees toin ~~vehemently~~connection ~~defend~~with ~~the~~such ~~foregoing~~services ~~action~~of $50,940.

~~NOTE~~As ~~10 -~~of ~~SUBSEQUENT~~July ~~EVENT~~31, 2016 and January 31, 2016, the Company owed related parties $228,724 and $27,942, respectively.

OnNOTE ~~May~~10 - ~~25,~~COMMITMENTS ~~2016,~~AND ~~the Company issued 15,397,129 shares of common stock for the conversion of debt and accrued interest of $27,715.~~CONTINGENCIES

14Licensing Agreement / Deposit

~~Table~~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 its 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 ~~Contents~~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. During the year ended January 31, 2016, the Company wrote off 50% of the deposit amounting to $562,500 to impairment expense. As of July 31, 2016, the software has not been delivered to the Company and the remaining amount of $562,500 continues to be reported as a deposit in the consolidated balance sheet.

~~ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS~~Contingency

~~Forward-Looking~~Connexum, ~~Statements~~LLC.

~~Management’s~~On ~~Discussion~~January ~~and~~18, ~~Analysis~~2016, ~~contains various “forward looking statements” within~~ the ~~meaning~~Company ofentered ~~Section~~into ~~21E~~an ofacquisition ~~the~~agreement ~~Securities~~with Net ~~Exchange Act of 1934~~D, aswhereby ~~amended, regarding future events or~~ the ~~future~~Company ~~financial~~acquired ~~performance~~100% of the ~~Company~~membership ~~that~~interest ~~involve~~of ~~risks and uncertainties. Certain statements included in this Form 10-Q~~Connexum, ~~including,~~LLC ~~without limitation, statements related to anticipated cash flow sources and uses, and words including but not limited to~~ (“~~anticipates~~Connexum”~~, “believes”, “plans”, “expects”, “future” and similar statements or expressions, identify forward looking statements~~). ~~Any~~The ~~forward-looking~~agreement ~~statements~~also ~~herein~~provided ~~are~~for ~~subject~~contingent toconsideration ~~certain~~of ~~risks~~1 ~~and~~Series ~~uncertainties~~C inPreferred ~~the~~share ~~Company’s~~convertible ~~business~~into $1,000,000 ~~including~~common ~~but~~shares ~~not~~if ~~limited~~Connexum ~~to,~~achieves ~~reliance~~80% onof ~~key~~anticipated ~~customers~~revenue and ~~competition~~another in1 ~~its~~Series ~~markets,~~C ~~market~~Preferred ~~demand,~~share ~~delayed~~convertible ~~payments~~into ~~of accounts receivables~~$1, ~~technological developments~~000,000 ~~maintenance~~common ofshares ~~relationships~~if ~~with~~Connexum ~~key~~achieves ~~suppliers,~~100% ~~difficulties~~ of ~~hiring~~anticipated orrevenue ~~retaining~~within ~~key~~one ~~personnel~~year ~~and~~from ~~any~~the ~~changes~~date inof ~~current~~acquisition. ~~accounting~~The ~~rules,~~Company ~~all~~determined ofthat ~~which~~Connexum ~~may~~will bemeet ~~beyond~~80% ~~the control~~ of the ~~Company.~~anticipated ~~Management will elect additional changes to~~ revenue ~~recognition~~and tohas ~~comply~~recognized ~~with~~ the ~~most~~fair ~~conservative~~value ~~SEC~~of ~~recognition on a forward going accrual basis as~~ the ~~model~~contingent isconsideration ~~replicated~~of ~~with~~$1,000,000 ~~other~~both ~~similar markets (i.e. SBDC). The Company’s actual results could differ materially from those anticipated in these forward-looking statements~~ as ~~a result~~ of ~~certain~~July ~~factors~~31, ~~including~~2016 ~~those~~and ~~set~~January ~~forth~~31, ~~therein~~2016.

~~Forward-looking~~15 ~~statements~~Table ~~involve~~of risks, uncertainties and other factors, which may cause our actual results, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. Factors and risks that could affect our results and achievements and cause them to materially differ from those contained in the forward-looking statements include those identified in the section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended January 31, 2016, as well as other factors that we are currently unable to identify or quantify, but that may exist in the future.Contents

InWindstream ~~addition~~Holdings, ~~the foregoing factors may affect generally our business, results of operations and financial position~~Inc. ~~Forward-looking statements speak only as of the date the statement was made. We do not undertake and specifically decline any obligation to update any forward-looking statements.~~

~~Overview~~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.

WeOn ~~were~~May ~~incorporated in the state of Nevada on January 6~~25, ~~2011 and our principal business address 5300 Melrose Avenue~~2016, ~~Suite~~the ~~42,~~Company ~~Las~~reached ~~Angeles, CA 90038. Gawk, Inc. offers~~ a ~~suite~~settlement ofwith ~~cloud~~Windstream ~~communications,~~for ~~cloud connectivity~~$20, ~~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~~000. ItAs ~~offers~~of athe ~~suite~~filing of ~~advanced~~this ~~data center and cloud-based services~~report, ~~including~~the ~~fault~~Company ~~tolerant,~~paid ~~high~~the ~~availability cloud servers~~$20, 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 security000. ~~www.gawkinc.com.~~

AsTarpon aBay ~~result~~Partners of our growth through acquisition, Gawk continues to go through a significant transformation and has expanded its business customer base and added a significant number of network facilities and points of presence expanding its geographic reach. Through this strategy, we acquired advanced systems and infrastructure, augmented our management team and employee base with talented, experienced, well-trained professionals, while continuing to provide a strong platform for further acquisitions. During the past fiscal year we completed two transactions which have significantly grown our revenue base while greatly enhancing our service offerings within the voice arena. The first was an asset purchase of Net D completed on May 1, 2015 and the second was an acquisition of Connexum completed near the end of our fiscal year on January 18, 2016.LLC

15On May 26, 2016, Tarpon Bay Partners, LLC (“Tarpon Bay”) initiated action against the Company in New York State Supreme Court, case #652178/2016. Tarpon Bay has elected for summary judgment in lieu of complaint. Tarpon Bay is claiming, inter alia, that the Company owes $93,500 in unpaid notes and services. The claims stems from intended transactions the Company was to enter with Tarpon Bay. Tarpon Bay was to provide the Company with funding and certain services in exchange for promissory notes from the Company. The notes were executed by the Company, but Tarpon Bay provided no funding or services and is not entitled to repayment of any note given by the Company. The Company intends to vehemently defend the foregoing action.

~~Table~~NOTE of11 - ~~Contents~~SUBSEQUENT EVENT

~~The~~Subsequent ~~Future~~to ofJuly ~~Gawk~~31, 2016, the Company issued as follows,

Gawk is pursuing a three-tiered growth strategy: developing specialized solutions for key vertical markets, targeting cloud services companies for acquisition, and accelerating organic growth. Our continuing effort to deliver advanced cloud solutions to companies with more complex requirements is supported by our cloud solutions platform that allows us to rapidly respond to our customers and potential customers’ needs for customized or enhanced solutions. We also intend to continue to develop vertically oriented solutions to expand our revenue opportunities and further differentiate our service suite. We intend to acquire additional cloud services companies that can further expand our customer base, allow us to introduce additional cloud products and services, and gain scale. Our strategy to organically grow our Business Services revenue includes securing large strategic distribution partners, increasing our direct as well as indirect channel sales efforts, upselling solutions to our existing base and leveraging our management, Board of Directors and shareholder relationship network.

	·	118,959,682 shares of common stock for the conversion of debt and accrued interest of $95,512.

	·	17,000,000 shares of common stock in exchange for the exercise of options for no consideration.

~~Three~~16 ~~Months~~Table ~~Ended~~of ~~April 30, 2016, Compared to Three Months Ended April 30, 2015~~Contents

~~RESULTS~~Item OF2. ~~OPERATIONS~~Management’s Discussion and Analysis of Financial Condition and Results of Operations

~~Revenue~~FORWARD LOOKING STATEMENTS

	For the Three Months Ended April 30,
	2016			2015			Change			%
Revenue		$	1,460,653		$	58,582		$	1,402,071		2,393	%
Cost of revenue			1,055,033			-			1,055,033		-
Gross profit		$	405,620		$	58,582		$	347,038		592	%

Management’s Discussion and Analysis contains various “forward looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, regarding future events or the future financial performance of the Company that involve risks and uncertainties. Certain statements included in this Form 10-Q, including, without limitation, statements related to anticipated cash flow sources and uses, and words including but not limited to “anticipates”, “believes”, “plans”, “expects”, “future” and similar statements or expressions, identify forward looking statements. Any forward-looking statements herein are subject to certain risks and uncertainties in the Company’s business, including but not limited to, reliance on key customers and competition in its markets, market demand, delayed payments of accounts receivables, technological developments, maintenance of relationships with key suppliers, difficulties of hiring or retaining key personnel and any changes in current accounting rules, all of which may be beyond the control of the Company. Management will elect additional changes to revenue recognition to comply with the most conservative SEC recognition on a forward going accrual basis as the model is replicated with other similar markets (i.e. SBDC). The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth therein.

~~Cost~~Forward-looking ofstatements ~~revenue~~involve ~~increased~~risks, touncertainties $1and other factors,~~055~~ which may cause our actual results,~~033~~ performance or achievements to be materially different from $0those ~~for~~expressed ~~the~~or ~~three~~implied ~~months~~by ~~ended~~such ~~April~~forward-looking ~~30,~~statements. ~~2016~~Factors and ~~2015,~~risks ~~respectively.~~that ~~The~~could ~~increase~~affect inour ~~revenue~~results isand ~~primarily~~achievements ~~related~~and cause them to materially differ from those contained in the ~~business~~forward-looking ~~combination~~statements ofinclude ~~Net~~those Didentified ~~and~~in ~~Connexum~~the ~~during~~section titled “Risk Factors” in the ~~past~~Company’s Annual Report on Form 10-K for the year ended January 31, 2016, as well as other factors that we are currently unable to identify or quantify, but that may exist in the future.

~~Operating~~In ~~Expenses~~addition, the foregoing factors may affect generally our business, results of operations and financial position. Forward-looking statements speak only as of the date the statement was made. We do not undertake and specifically decline any obligation to update any forward-looking statements.

	For the Three Months Ended April 30,
	2016			2015			Change			%
General and administration		$	525,240		$	304,276		$	220,964		73	%
Depreciation and amortization			231,291			51,497			179,794		349	%
Total operating expenses		$	756,531		$	355,773		$	400,758		113	%

General Overview

~~General~~We were incorporated in the state of Nevada on January 6, 2011 and ~~administrative~~our ~~expenses~~principal ~~increased~~business toaddress ~~$525~~5300 Melrose Avenue,~~240~~ ~~from~~Suite ~~$304~~42,~~276~~ ~~for~~Las ~~the~~Angeles, ~~three~~CA ~~months~~90038. ~~ended~~Gawk, ~~April~~Inc. 30offers a suite of cloud communications, ~~2016~~cloud connectivity, cloud computing, and ~~2015~~managed cloud-based applications solutions to small, ~~respectively. The~~medium, ~~increase~~and inlarge ~~general~~businesses; and ~~administrative~~offers ~~expenses~~domestic isand ~~primarily~~international ~~related~~voice services to ~~the~~communications ~~business~~carriers ~~combination~~worldwide. It offers a suite of ~~Net~~advanced Ddata center and ~~Connexum~~cloud-based ~~during~~services, ~~the~~including ~~past~~fault ~~year~~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. www.gawkinc.com.

~~Depreciation~~As ~~and~~a ~~amortization~~result ~~expenses~~of ~~increased~~our togrowth ~~$231~~through acquisition,~~291~~ ~~from~~Gawk ~~$51,497~~continues ~~for~~to ~~the~~go ~~three~~through ~~months~~a ~~ended~~significant ~~April~~transformation 30and has expanded its business customer base and added a significant number of network facilities and points of presence expanding its geographic reach. Through this strategy, ~~2016~~we acquired advanced systems and ~~2015~~infrastructure, ~~respectively. Depreciation~~augmented our management team and ~~amortization~~employee ~~expenses~~base ~~increase~~with ~~due~~talented, experienced, well-trained professionals, while continuing to ~~the~~provide ~~business~~a ~~combination~~strong ofplatform ~~Net~~for Dfurther acquisitions. During the past fiscal year and ~~Connexum~~current ~~whereas~~reporting ~~the~~period, ~~assets~~we ~~were~~completed ~~placed~~three intransactions which have significantly grown our revenue base while greatly enhancing our service ~~and~~offerings ~~depreciate~~within ~~over~~the avoice ~~three~~arena. ~~(3)~~The ~~year~~first ~~period~~was ~~starting~~an asset purchase of Net D completed on May 1, 2015, ~~and~~the second was an acquisition of Connexum completed near the end of our fiscal year on January 18, 2016, ~~respectively~~and the third was the acquisition of XTELUS completed on June 27, 2016.

~~Net~~The ~~loss~~Future of Gawk

~~For~~Gawk ~~the~~is pursuing a three-tiered ~~months~~growth ~~ended~~strategy: ~~April~~developing 30specialized solutions for key vertical markets, ~~2016~~targeting cloud services companies for acquisition, ~~the~~and ~~Company~~accelerating ~~had~~organic agrowth. ~~net~~Our ~~loss~~continuing ofeffort ~~$813~~to deliver advanced cloud solutions to companies with more complex requirements is supported by our cloud solutions platform that allows us to rapidly respond to our customers and potential customers’ needs for customized or enhanced solutions. We also intend to continue to develop vertically oriented solutions to expand our revenue opportunities and further differentiate our service suite. We intend to acquire additional cloud services companies that can further expand our customer base,~~813~~ allow us to introduce additional cloud products and services, asand ~~compared~~gain scale. Our strategy to aorganically ~~net~~grow ~~loss~~our ~~for~~Business ~~the~~Services ~~three~~revenue ~~months~~includes ~~ended~~securing ~~April~~large 30strategic distribution partners, ~~2015~~increasing ofour ~~$325~~direct as well as indirect channel sales efforts,~~288~~ upselling solutions to our existing base and leveraging our management, Board of Directors and shareholder relationship network.

~~Liquidity~~17 ~~and~~Table ~~Capital~~of ~~Resources~~Contents

~~The~~Results ~~following table presents selected financial information on our capital as~~ of ~~April 30, 2016 and January 31, 2016.~~Operations

	April 30,				January 31,
	2016				2016				Change				%
Current Assets		$	906,906			$	783,665			$	123,241			16	%
Current Liabilities			6,200,253				5,925,379				274,874			5	%
Working Deficiency		$	(5,293,347	)		$	(5,141,714	)		$	(151,633	)		3	%

Three Months Ended July 31, 2016, Compared to Three Months Ended July 31, 2015

16Revenue

Table of Contents

	For the Three Months Ended July 31,
	2016		2015		Change		%
Revenue	$	1,319,429	$	558,079	$	761,350		136	%
Cost of revenue		933,830		392,629		541,201		138	%
Gross profit	$	385,599	$	165,450	$	220,149		133	%

~~The~~Revenue ~~following~~increased ~~table~~to ~~presents~~$1,319,429 ~~selected~~from ~~financial~~$558,079 ~~information~~for onthe ~~our~~three ~~cash~~months ~~flows~~ended asJuly 31, 2016 and 2015, respectively. The increase in revenue is primarily related to the business combination of Connexum during the past year and ~~for~~XTELUS during the three months ended ~~April~~July 3031, 2016 ~~and 2015~~.

	For the Three Months Ended April 30,
	2016				2015				Change
Cash Flows used in Operating Activities		$	(99,947	)		$	(129,556	)		$	29,609
Cash Flows from Financing Activities			130,672				-				130,672
Net Increase (Decrease) in Cash		$	30,725			$	(129,556	)		$	160,281

Cost of revenue increased to $933,830 from $392,629 for the three months ended July 31, 2016 and 2015, respectively. The increase in revenue is primarily related to the business combination of Connexum during the past year and XTELUS during the current period.

AsOperating of April 30, 2016 and January 31, 2016 our cash was $95,669 and $64,944, respectively. The Company does not believe its existing balances of cash and cash equivalents will be sufficient to satisfy its working capital needs, capital asset purchases, outstanding commitments and other liquidity requirements associated with its existing operations over the 12 months.Expenses

As of April 30, 2016, we experienced an increase in working capital deficiency of $151,633 or 3%, as compared to January 31, 2016. The change in working capital deficiency during 2016 was primarily from an increase in current assets by $123,241 as compared to January 31, 2016, due to an increase in cash of $30,725 and accounts receivable of $74,816 and an increase in current liabilities by $274,874 as compared to January 31, 2016, due to an increase in accounts payable and accrued liabilities of $95,561, due to related parties of $136,497 and derivative liabilities of $50,408.

	For the Three Months Ended July 31,
	2016		2015		Change			%
General and administration	$	796,429	$	265,999	$	530,430			199	%
Research and development		-		2,500		(2,500	)	(100)		%
Depreciation and amortization		231,293		93,278		138,015			148	%
Total operating expenses	$	1,027,722	$	361,777	$	665,945			184	%

~~Cash~~General ~~flows~~and ~~from~~administrative ~~operations. Our~~expenses ~~cash~~increased ~~used~~to in$796,429 ~~operating~~for ~~activities~~the ~~were~~three ~~$99~~months ended July 31,~~947~~ ~~and~~2016, as compared to $~~129~~265,~~556~~999 for the three months ended ~~April~~ ~~30,~~July ~~2016 and 2015~~31, ~~respectively~~2015. The ~~decrease~~increase in ~~cash~~general ~~flows~~and ~~used~~administrative inexpenses ~~operating~~is ~~activities was~~ primarily ~~attributable~~related to the business combination of ~~Net~~Connexum Dduring the past year and ~~Connexum~~XTELUS during the ~~past~~quarter ~~year~~ended July 31, 2015.

~~Cash~~Depreciation ~~flows~~and ~~from~~amortization ~~financing~~expenses ~~activities. Cash provided by financing activities~~ were $~~130~~231,~~672~~293 ~~and~~from $093,278 for the three months ended ~~April~~July 3031, 2016 and 2015, respectively. WeDepreciation ~~received~~and ~~cash~~amortization ~~from~~expenses ~~convertible~~increased ~~notes~~in ~~of $245~~2016,~~116~~ ~~and~~due ~~issuance~~to ofthe ~~Series~~business Bcombination ~~Preferred stock~~ of ~~$20,000~~Connexum ~~and~~whereas ~~paid~~the ~~notes~~assets ~~payable~~were ofplaced ~~$101,111~~in service and ~~convertible~~depreciate ~~note~~over ofa ~~$33,333~~three ~~for~~(3) ~~the~~year ~~three~~period ~~months~~starting ~~ended~~January ~~April 30~~18, 2016, respectively.

WeSix ~~expect~~Months toEnded ~~incur~~July ~~substantial~~31, ~~expenses and generate significant operating losses as we continue to grow our operations~~2016, asCompared ~~well as incur expenses related~~ to ~~operating~~Six asMonths aEnded ~~public~~July ~~company~~31, ~~and compliance with regulatory requirements.~~2015

The independent auditor’s report on our financial statements contains explanatory language that substantial doubt exists about our ability to continue as a going concern. We have an accumulated deficit at April 30, 2016 of $14,871,464 and need additional cash flows to maintain our operations. We depend on the continued need to raise financing to finance our operations and need to obtain additional funding sources to explore potential strategic relationships and to provide capital and other resources for the further development and marketing of our products and business. We expect our cash needs for the next 12 months to be $750,000 to fund our operations. The ability of the Company to continue its operations is dependent on the successful execution of management’s plans, which include expectations of raiding debt or equity based capital until such time that funds from operations are sufficient to fund working capital requirements. The Company may need to incur additional liabilities with related parties to sustain the Company’s existence. There is no assurance that such funding, if required will be available to us or, if available, will be available upon terms favorable to us.Revenue

These factors raise 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.

	For the Six Months Ended July 31,
	2016		2015		Change		%
Revenue	$	2,780,082	$	616,661	$	2,163,421		351	%
Cost of revenue		1,988,863		392,629		1,596,234		407	%
Gross profit	$	791,219	$	224,032	$	567,187		253	%

~~Critical~~18 ~~Accounting~~Table ~~Policies~~of Contents

~~Accounts~~Revenue ~~Receivable~~was $2,780,082 and ~~Allowance~~$616,661 for ~~Uncollectible~~the ~~Accounts~~six months ended July 31, 2016 and 2015, respectively. The increase in revenue, during 2016, is primarily related to the business combination of Net D and Connexum during the past year and XTELUS during the quarter ended July 31, 2016.

~~Substantially~~Cost ~~all~~ of ~~the~~revenue ~~Company’s~~was ~~accounts~~$1,988,863 ~~receivable balance is related to trade receivables. Trade accounts receivable are recorded at the invoiced amount~~ and do$392,629 ~~not bear interest. The allowance~~ for ~~doubtful accounts is~~ the ~~Company’s~~six ~~best~~months ~~estimate~~ended ofJuly ~~the~~31, ~~amount~~2016 of probable credit losses in its existing accounts receivable. The Company will maintain 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~~2015, ~~estimates are recorded~~respectively. The ~~remaining~~increase ~~accounts receivable balances are then grouped~~ in ~~categories~~revenue ~~by the number of days the balance~~ is ~~past~~primarily ~~due,~~related ~~and~~to the ~~estimated~~business ~~loss~~combination isof ~~calculated~~Net asD aand ~~percentage~~Connexum ofduring the ~~total category based upon~~ past ~~history.~~year ~~Account~~and ~~balances~~XTELUS ~~are~~during ~~charged~~quarter ~~against~~ended ~~the~~July ~~allowance~~31, ~~when it is probable the receivable will not be recovered~~2016.

17Operating Expenses

Table of Contents

	For the Six Months Ended July 31,
	2016		2015		Change			%
General and administration	$	1,321,669	$	570,275	$	751,394			132	%
Research and development		-		2,500		(2,500	)	(100)		%
Depreciation and amortization		462,584		144,775		317,809			220	%
Total operating expenses	$	1,784,253	$	717,550	$	1,066,703			149	%

~~Revenue~~General ~~Recognition~~and administrative expenses increased to $1,321,669 from $570,275 for the six months ended July 31, 2016 and 2015, respectively. The increase in general and administrative expenses is primarily related to the business combination of Net D and Connexum during the past year and XTELUS during current year.

~~The~~Depreciation ~~Company~~and ~~pursues~~amortization ~~opportunities~~expenses increased to ~~realize~~$462,584 ~~revenues~~ from ~~consulting~~$144,775 ~~services.~~for Itthe issix ~~the~~months ~~company’s~~ended ~~policy~~July ~~that~~31, ~~revenues~~2016 and ~~gains will be recognized in accordance with ASC Topic 605-10-25~~2015, ~~“Revenue Recognition~~respectively.” ~~Under~~Depreciation ~~ASC~~and ~~Topic~~amortization ~~605-10-25,~~expenses ~~revenue~~increased ~~earning~~due ~~activities~~to ~~are~~the ~~recognized~~business ~~when~~combination ~~all~~ of ~~the~~Net ~~following~~D ~~criteria~~and ~~are~~Connexum ~~met:~~whereas ~~(i)~~the ~~persuasive~~assets ~~evidence~~were ofplaced anin ~~arrangement~~service ~~exists,~~and ~~(ii)~~depreciate ~~the~~over ~~services~~a ~~have~~three ~~been rendered to the customer,~~ (~~iii~~3) ~~the~~year ~~sales~~period ~~price~~starting isMay ~~fixed or determinable~~1, 2015 and ~~(iv)~~January ~~collectability~~18, is2016, ~~reasonably assured~~respectively.

~~Our~~Net 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.loss

~~Our~~For ~~Carrier~~the ~~Services~~six ~~revenue~~months isended ~~primarily~~July ~~derived~~31, ~~from~~2016, ~~usage fees charged to other carriers that terminate voice traffic over our network. Variable revenue is earned based on~~ the ~~length~~Company ofhad a ~~call,~~net asloss ~~measured by the number~~ of ~~minutes of duration. It is recognized upon completion of the call~~$1,971,710, ~~and~~as iscompared ~~adjusted~~ to ~~reflect~~a ~~the~~net ~~allowance~~loss for ~~billing adjustments. Revenue for each customer is calculated from information received through our network switches. Our customized software tracks~~ the ~~information~~six ~~from~~months ~~the~~ended ~~switches~~July ~~and~~31, ~~analyzes~~2015 ~~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~~$581,771. ~~We believe that the nature of this process is such that recorded revenues are unlikely to be revised in future periods.~~

~~Long-lived~~Liquidity ~~Assets~~and Capital Resources

The ~~Company reviews~~following ~~its~~table ~~fixed~~presents ~~assets~~selected ~~and~~financial ~~certain identifiable intangibles~~information ~~for~~on ~~impairment whenever events or changes in circumstances indicate that~~our ~~the~~capital ~~carrying~~as ~~amount~~ of anJuly ~~asset~~31, ~~may~~2016 ~~not be recoverable. Recoverability of assets to be held~~ and ~~used~~January is measured by a comparison of the carrying amount of an asset to the future undiscounted operating cash flow expected to be generated by the asset. If such assets are considered to be impaired31, ~~the impairment to~~ ~~be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the asset~~2016. ~~Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.~~

Goodwill and Other Intangible Assets

	July 31,			January 31,
	2016			2016			Change			%
Current Assets	$	890,604		$	783,665		$	106,939			14	%
Current Liabilities		6,702,205			5,925,379			776,826			13	%
Working Deficiency	$	(5,811,601	)	$	(5,141,714	)	$	(669,887	)		13	%

WeThe ~~account~~following ~~for~~table ~~goodwill~~presents ~~and~~selected ~~intangible~~financial ~~assets~~information ~~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 anour ~~interim~~cash ~~basis~~flows ifas ~~events or circumstances indicate that the fair value~~ of anand ~~asset has decreased below its carrying value. In addition, ASC 350 requires that goodwill be tested~~ for ~~impairment at~~ the ~~reporting~~six ~~unit~~months ~~level~~ended ~~(operating~~July 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 judgment31, ~~including~~2016 ~~the identification of reporting units; assigning assets~~ and ~~liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value~~2015. 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.

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.

	For the Six Months Ended July 31,
	2016			2015			Change
Cash Flows used in Operating Activities	$	(278,375	)	$	(194,104	)	$	(84,271	)
Cash Flows used in Investing Activities		397			(65,000	)		65,397
Cash Flows from Financing Activities		267,968			47,500			220,468
Foreign currency translation adjustment		-			442			(442	)
Net Decrease in Cash During the Year	$	(10,010	)	$	(211,162	)	$	201,152

19 WeTable ~~have~~of ~~no off-balance sheet arrangements including arrangements that would affect the liquidity, capital resources, market risk support and credit risk support or other benefits.~~Contents

18As of July 31, 2016 and January 31, 2016 our cash was $54,934 and $64,944, respectively. The Company does not believe its existing balances of cash and cash equivalents will be sufficient to satisfy its working capital needs, capital asset purchases, outstanding commitments and other liquidity requirements associated with its existing operations over the 12 months.

~~WHERE~~As ~~YOU~~of ~~CAN~~July ~~FIND~~31, ~~MORE~~2016, ~~INFORMATION~~we experienced an increase in working capital deficiency of $669,887 or 13%, as compared to January 31, 2016. The reduction in working capital during 2016 was primarily from an increase in current assets by $106,939 as compared to January 31, 2016, due to an increase in accounts receivable of $78,800 and accounts receivable of $74,816 and an increase in current liabilities by $776,826 as compared to January 31, 2016, due to an increase in accounts payable and accrued liabilities of $156,919, due to related parties of $200,782, convertible notes payable of $104,478 and derivative liabilities of $261,210.

~~You~~Cash ~~are~~flows ~~advised~~from tooperations. ~~read~~Our ~~this~~cash ~~Quarterly~~used ~~Report on Form 10-Q~~ in ~~conjunction~~operating ~~with~~activities ~~other~~were ~~reports~~$278,375 and ~~documents~~$194,104 ~~that~~for ~~we file from time to time with~~ the ~~SEC.~~six Inmonths ~~particular,~~ended ~~please~~July ~~read our Quarterly Reports on Form 10-Q~~31, ~~Annual~~2016 ~~Report~~and ~~on Form 10-K~~2015, ~~and Current Reports on Form 8-K that we file from time to time~~respectively. ~~You~~The ~~may~~increase ~~obtain~~in ~~copies~~cash offlows ~~these~~used ~~reports~~in ~~directly~~operating ~~from~~activities uswas orprimarily ~~from~~attributable ~~the~~to ~~SEC~~an atincrease ~~the~~in ~~SEC’s~~general ~~Public Reference Room at 100 F. Street, N.E. Washington, D.C. 20549,~~ and ~~you~~administration ~~may~~expenses ~~obtain~~associated ~~information~~with ~~about obtaining access to~~ the ~~Reference~~expand ~~Room~~of ~~by calling the SEC at 1-800-SEC-0330~~business. ~~In addition, the SEC maintains information for electronic filers at its website http://www.sec.gov.~~

~~ITEM 3~~Cash flows from investing activities. ~~QUANTITATIVE~~ ~~AND~~Cash ~~QUALITATIVE~~provided ~~DISCLOSURES~~by ~~ABOUT~~investing ~~MARKET~~activities ~~RISK~~was $397 for the six months ended July 31, 2016 and cash used in investing activities was $65,000 for six months ended July 31, 2015. Net cash received for acquisition of XTELUS was $397 for the six months ended July 31, 2016. Net cash paid for acquisition of Net D’s assets was $65,000 for the six months ended July 31, 2015.

~~Not~~Cash ~~applicable~~flows from financing activities. Cash provided by financing activities were $267,968 and $47,500 for ~~smaller~~the ~~reporting~~six ~~companies~~months ended July 31, 2016 and 2015, respectively. We received cash from convertible notes of $557,579, note payable - related party of $25,000 and issuance of Series B Preferred stock of $20,000 and paid notes payable of $301,275 and convertible note of $33,333 for the six months ended July 31, 2016. We received cash from convertible notes of $25,000, issuance of common stock of $5,000 and issuance of Series B Preferred stock of $17,500 for the six months ended July 31, 2015.

~~ITEM~~We ~~4. CONTROLS~~expect ~~AND~~to ~~PROCEDURES~~incur substantial expenses and generate significant operating losses as we continue to grow our operations, as well as incur expenses related to operating as a public company and compliance with regulatory requirements.

(The independent auditor’s report on our financial statements contains explanatory language that substantial doubt exists about our ability to continue as a) ~~Evaluation~~going concern. We have an accumulated deficit at July 31, 2016 of ~~Disclosure~~$16,029,361 ~~Controls~~and need additional cash flows to maintain our operations. We depend on the continued need to raise financing to finance our operations and ~~Procedures~~need to obtain additional funding sources to explore potential strategic relationships and to provide capital and other resources for the further development and marketing of our products and business. We expect our cash needs for the next 12 months to be $750,000 to fund our operations. The ability of the Company to continue its operations is dependent on the successful execution of management’s plans, which include expectations of raiding debt or equity based capital until such time that funds from operations are sufficient to fund working capital requirements. The Company may need to incur additional liabilities with related parties to sustain the Company’s existence. There is no assurance that such funding, if required will be available to us or, if available, will be available upon terms favorable to us.

WeThese ~~maintain~~factors ~~disclosure~~raise ~~controls~~doubt ~~and~~about ~~procedures~~the ~~that~~Company’s ~~are~~ability ~~designed~~ to ~~ensure~~continue ~~that~~as ~~information~~a ~~required~~going toconcern. beThe ~~disclosed~~accompanying infinancial ~~our~~statements ~~Exchange~~do ~~Act~~not ~~reports~~include isany ~~recorded,~~adjustments ~~processed,~~that ~~summarized~~might ~~and~~result ~~reported~~from ~~within~~ the ~~time~~outcome ~~periods~~of ~~specified~~this inuncertainty. ~~the~~The ~~Securities and Exchange Commission'~~Company’s ~~rules~~continued ~~and~~existence ~~forms and that such information~~ is ~~accumulated~~dependent ~~and~~upon ~~communicated~~management’s ability to ~~our~~develop ~~Chief~~profitable ~~Executive Officer and Principal Financial Officer~~operations, ascontinued ~~appropriate,~~contributions tofrom ~~allow for timely decisions regarding required disclosure. In designing and evaluating~~ the ~~disclosure~~Company’s ~~controls~~executive ~~and~~officers ~~procedures,~~to ~~management~~finance ~~recognizes~~its ~~that~~operations ~~any controls~~ and ~~procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving~~ the ~~desired~~ability ~~control~~to ~~objectives,~~obtain ~~and~~additional ~~management~~funding issources ~~required~~ to ~~apply~~explore ~~its~~potential ~~judgment~~strategic inrelationships ~~evaluating the cost-benefit relationship of possible controls~~ and ~~procedures. Our disclosure controls and procedures were designed~~ to provide ~~reasonable~~capital ~~assurance that the controls~~ and ~~procedures~~other ~~would~~resources ~~meet~~for ~~their objectives. As required by SEC Rule 13a-15(b), our Chief Executive Officer and Principal Financial Officer carried out an evaluation of~~ the ~~effectiveness~~further ofdevelopment ~~the design~~ and ~~operation~~marketing of ~~our disclosure controls and procedures as of~~ the ~~end~~Company’s ofproducts ~~the period covered by this report. Based on the foregoing, our Chief Executive Officer~~ and ~~Principal Financial Officer concluded that our disclosure controls and procedures were not effective~~business.

~~Our~~20 ~~Chief~~Table ~~Executive Officer and Principal Financial Officer are responsible for establishing and maintaining adequate internal control over our financial reporting. In order to evaluate the effectiveness~~ of internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, management has conducted an assessment, including testing, using the criteria in Internal Control — Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Our system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Management has used the framework set forth in the report entitled Internal Control-Integrated Framework published by the Committee of Sponsoring Organizations of the Treadway Commission, known as COSO, to evaluate the effectiveness of our internal control over financial reporting. Based on this assessment, our Chief Executive Officer and Principal Financial Officer have concluded that our internal control over financial reporting were not effective as of April 30, 2016. There has been no change in our internal controls over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.Contents

~~The~~Critical ~~Company's~~Accounting ~~material weaknesses in financial reporting were:~~Policies

●Accounts ~~Lack~~Receivable 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~~Allowance befor ~~expanded~~Uncollectible to as many as seven members under the Company’s Articles of Incorporation and By-Laws. ● Lack of segregation of duties and adequate documentation of our internal controls. ● The inability of the Company to prepare and file its financial statements timely due to its limited financial and personnel resources. ● Lack of multiple levels of review in the Company’s financial reporting process.Accounts

19Substantially 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 will maintain 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 the receivable will not be recovered.

~~Table~~Revenue ~~of Contents~~Recognition

~~PART~~The IICompany 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.

~~OTHER~~Our ~~INFORMATION~~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.

~~ITEM~~Our 1Carrier Services revenue is primarily derived from usage fees charged to other carriers that terminate voice traffic over our network. ~~LEGAL~~ ~~PROCEEDINGS~~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.

OnLong-lived or around April 27, 2016, Tarpon Bay Partners, LLC (“Tarpon Bay”) initiated action against the Company in New York State Supreme Court, case #652178/2016. Tarpon Bay has elected for summary judgment in lieu of complaint. Tarpon Bay is claiming, inter alia, that the Company owes $93,500 in unpaid notes and services. The claims stems from intended transactions the Company was to enter with Tarpon Bay. Tarpon Bay was to provide the Company with funding and certain services in exchange for promissory notes from the Company. The notes were executed by the Company, but Tarpon Bay provided no funding or services and is not entitled to repayment of any note given by the Company. The Company intends to vehemently defend the foregoing action.Assets

~~ITEM~~The 1ACompany reviews its fixed assets and certain identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. ~~RISK~~ ~~FACTORS~~Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted operating cash flow expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.

~~There~~Goodwill ~~were~~and noOther ~~material~~Intangible changes from the risk factors previously disclosed in Part II, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended January 31, 2016, during our three months ended April 30, 2016.Assets

~~ITEM~~We 2account for goodwill and intangible assets in accordance with ASC 350 "Intangibles-Goodwill and Other" ("ASC 350"). ~~UNREGISTERED~~ ~~SALES~~ASC OF350 ~~EQUITY~~requires ~~SECURITIES~~that ~~AND~~goodwill ~~USE~~and OFother ~~PROCEEDS~~intangibles ~~SECURITIES~~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.

~~Common~~21 ~~stock~~Table of Contents

~~During~~The cost of intangible assets with determinable useful lives is amortized to reflect the ~~three~~pattern ~~months~~of ~~ended~~economic ~~April~~benefits 30consumed, ~~2016,~~either on a straight-line or accelerated basis over the ~~Company~~estimated ~~issued~~periods 80benefited. Patents,~~390,834~~ ~~common~~technology ~~shares~~and ~~for~~other ~~the~~intangibles ~~conversion~~with ofcontractual ~~debt~~terms are generally amortized over their respective legal or contractual lives. Customer relationships, brands and ~~accrued~~other ~~interest~~non-contractual ofintangible ~~$205~~assets with determinable lives are amortized over periods 3 years. When certain events or changes in operating conditions occur,~~965~~ an impairment assessment is performed and lives of intangible assets with determinable lives may be adjusted.

~~Series~~We Bhave ~~Convertible~~no ~~Preferred~~off-balance ~~Stock~~sheet arrangements including arrangements that would affect the liquidity, capital resources, market risk support and credit risk support or other benefits.

~~During~~Derivative ~~the~~Financial ~~three months ended April 30, 2016, the Company issued Series B Preferred shares, as follows:~~Instruments

·The Onfair ~~December~~value ~~21,~~of ~~2015,~~an ~~the~~embedded ~~Company~~conversion ~~recorded~~option ~~preferred~~that ~~stock~~is ~~payable~~convertible into a variable amount of ~~$13~~shares and warrants that include price protection reset provision features are deemed to be “down-round protection” and,~~438~~ therefore, do not meet the scope exception for 13treatment as a derivative under ASC 815 “Derivatives and Hedging,~~437,500~~” ~~Series~~since B“down-round ~~Preferred~~protection” ~~shares~~is ~~related~~not toan input into the ~~acquisition~~calculation of the ~~assets~~fair value of ~~Net~~the D.conversion ~~During~~option ~~the~~and ~~three~~warrants ~~months~~and ~~ended~~cannot ~~April~~be ~~30,~~considered ~~2016~~“indexed to the Company’s ~~issued~~own ~~13,437,500~~stock” ~~Series~~which Bis ~~Preferred~~a ~~shares~~requirement tofor ~~settle~~the ~~this~~scope ~~payable~~exception as outlined under ASC 815.

·The Onaccounting ~~February~~treatment 3,of ~~2016,~~derivative 4financial 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,~~750,000~~ ~~shares~~non-cash ~~were~~income ~~sold~~or expense for ~~cash~~each reporting period at each balance sheet date. The Company reassesses the classification of ~~$20~~its derivative instruments at each balance sheet date. If the classification changes as a result of events during the period,~~000~~ the contract is reclassified as of the date of the event that caused the reclassification.

~~ITEM~~The 3Black-Scholes option valuation model was used to estimate the fair value of the embedded conversion options and warrants. ~~DEFAULTS~~ ~~UPON~~The ~~SENIOR~~model ~~SECURITIES~~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.

AsConversion ofoptions ~~April~~are ~~30,~~recorded ~~2016,~~as ~~the~~debt ~~Company~~discount isand inare ~~default~~amortized onas ~~two~~interest ~~notes~~expense ~~payable,~~over ~~which~~the ~~have~~life ~~a principal balance~~ of ~~$1,725,000~~the ~~and~~underlying ~~accrued~~debt ~~interest of $289,504~~instrument.

~~ITEM~~WHERE ~~4. MINING~~YOU ~~SAFETY~~CAN ~~DISCLOSURES~~ FIND MORE INFORMATION

~~Not~~You ~~applicable~~are advised to read this Quarterly Report on Form 10-Q in conjunction with other reports and documents that we file from time to time with the SEC. In particular, please read our Quarterly Reports on Form 10-Q, Annual Report on Form 10-K, and Current Reports on Form 8-K that we file from time to time. You may obtain copies of these reports directly from us or from the SEC at the SEC’s Public Reference Room at 100 F. Street, N.E. Washington, D.C. 20549, and you may obtain information about obtaining access to the Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains information for electronic filers at its website http://www.sec.gov.

~~ITEM~~Item 53. ~~OTHER~~ ~~INFORMATION~~Quantitative and Qualitative Disclosures About Market Risk

~~There~~As isa no“smaller ~~information~~reporting ~~with~~company”, ~~respect~~we toare ~~which~~not ~~information~~required isto ~~not~~provide ~~otherwise~~the ~~called~~information ~~for~~required by this ~~form~~Item.

2022 Table of Contents

~~Table~~Item of4. ~~Contents~~Controls and Procedures

~~ITEM~~(a) ~~6. EXHIBITS~~Evaluation of Disclosure Controls and Procedures

~~Exhibits~~We ~~filed~~maintain ~~herein~~disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to our Chief Executive Officer and Principal Financial Officer, as appropriate, to allow for ~~April~~timely 30decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, ~~2016~~management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Our disclosure controls and procedures were designed to provide reasonable assurance that the controls and procedures would meet their objectives. As required by SEC Rule 13a-15(b), our Chief Executive Officer and Principal Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our Chief Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures were not effective.

~~Exhibits~~Our Chief Executive Officer and Principal Financial Officer are responsible for establishing and maintaining adequate internal control over our financial reporting. In order to evaluate the effectiveness of internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, management has conducted an assessment, including testing, using the criteria in Internal Control - Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Our system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Management has used the framework set forth in the report entitled Internal Control-Integrated Framework published by the Committee of Sponsoring Organizations of the Treadway Commission, known as COSO, to evaluate the effectiveness of our internal control over financial reporting. Based on this assessment, our Chief Executive Officer and Principal Financial Officer have concluded that our internal control over financial reporting were not effective as of July 31, 2016. There has been no change in our internal controls over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

Exhibit Number		Description of Exhibits
3.1		Articles of Incorporation (1)
3.2		Bylaws (1)
14.1		Code of Ethics (2)
31.1*		Certification of Principal Executive Officer pursuant to 18 U.S.C Section 1350, as adopted Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of Principal Principal Financial Officer pursuant to 18 U.S.C Section 1350, as adopted Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*		Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**		XBRL Instance Document
101.SCH**		XBRL Taxonomy Schema
101.CAL**		XBRL Taxonomy Calculation Linkbase
101.DEF**		XBRL Taxonomy Definition Linkbase
101.LAB**		XBRL Taxonomy Label Linkbase
101.PRE**		XBRL Taxonomy Presentation Linkbase

The Company's material weaknesses in financial reporting were:

(1)	Filed as an Exhibit on Form S-1 with the SEC on April 6, 2012.
(2)	10-SB/12g filed on February 13, 2008

	a.	There is no segregation of duties as our CEO is also our CFO.

	b.	It should be noted that any system of controls, however well designed and operated, can provide only reasonable and not absolute assurance that the objectives of the system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of certain events. Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

	c.	There were no changes in our internal control over financial reporting that occurred during the quarter ended July 31, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

*23 ~~Filed~~Table ~~herewith~~of Contents

**XBRLPART ~~(Extensible~~II ~~Business~~- ~~Reporting~~OTHER Language) information is furnished and not filed or a part of this annual report or purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.INFORMATION

21Item 1. Legal Proceedings

~~Table~~On or around April 27, 2016, Tarpon Bay Partners, LLC (“Tarpon Bay”) initiated action against the Company in New York State Supreme Court, case #652178/2016. Tarpon Bay has elected for summary judgment in lieu of ~~Contents~~complaint. Tarpon Bay is claiming, inter alia, that the Company owes $93,500 in unpaid notes and services. The claims stems from intended transactions the Company was to enter with Tarpon Bay. Tarpon Bay was to provide the Company with funding and certain services in exchange for promissory notes from the Company. The notes were executed by the Company, but Tarpon Bay provided no funding or services and is not entitled to repayment of any note given by the Company. The Company intends to vehemently defend the foregoing action.

~~SIGNATURES~~On or around July 22, 2016, the Company’s wholly owned subsidiary, Webrunners, Inc. (“Webrunners”), filed a law suit (“WR v. Management”) against several former Webrunners directors and officers for mismanaging Webrunners and usurping or interfering with Webrunners’ business relationships. On or around July 22, 2016, the former management and related entities filed a lawsuit against the Company in the Superior Court of Orange County, CA case #30-2016-00865197-CU-BC-CJC, alleging, inter alia, breach of the agreements pursuant to which the Company acquired Webrunners, fraud, and negligent misrepresentation. The Company filed a counterclaim on or around September 9, 2016, alleging, inter alia, breach of contract. On or around September 15, 2016, the court in WR v. Management granted an injunction against the former management forcing them to turn over all documents and assets of Webrunners and preventing them from interfering further with Webrunners’ business.

~~Pursuant~~Item to1A. ~~the~~Risk ~~requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934 the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.~~Factors

Registrant Date: June 14, 2016		Gawk Incorporated By: /s/ Scott Kettle
		Scott Kettle
		Chief Executive Officer (Principal Executive Officer)

There were no material changes from the risk factors previously disclosed in Part II, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended January 31, 2016, during our six months ended July 31, 2016.

22Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Common Stock

During the three months ended July 31, 2016, the Company issued 74,756,441 common shares for the conversion of debt and accrued interest of $130,042 and 24,000,000 common shares in exchange for options for no consideration.

Series D Convertible Preferred Stock

During the three months ended July 31, 2016, the Company issued 1 share of Series D Preferred Stock for the acquisition of XTELUS.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Table of Contents

Item 6. Exhibits

Exhibit Number		Description of Exhibits
3.1		Articles of Incorporation (1)
3.2		Bylaws (1)
10.1*		Acquisition agreement with NEOGEN Holdings Inc.
14.1		Code of Ethics (2)
31.1*		Certification of Principal Executive Officer pursuant to 18 U.S.C Section 1350, as adopted Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of Principal Financial Officer pursuant to 18 U.S.C Section 1350, as adopted Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*		Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**		XBRL Instance Document
101.SCH**		XBRL Taxonomy Schema
101.CAL**		XBRL Taxonomy Calculation Linkbase
101.DEF**		XBRL Taxonomy Definition Linkbase
101.LAB**		XBRL Taxonomy Label Linkbase
101.PRE**		XBRL Taxonomy Presentation Linkbase

___________

(1)	Filed as an Exhibit on Form S-1 with the SEC on April 6, 2012.
(2)	10-SB/12g filed on February 13, 2008

* Filed herewith.

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, thereunto duly authorized.

	Gawk Incorporated
	(Registrant)

Dated: September 21, 2016	By:	/s/ Scott Kettle
		Scott Kettle
		Chief Executive Officer
		(Principal Executive Officer)

Dated: September 21, 2016	By:	/s/ Chris Hall
		Chris Hall
		Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

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