UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended February 28, 2019
	For the quarterly period ended May 31, 2019
or
¨	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ________________ to ________________
	Commission File Number _____________

¨	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ______________ to ______________
	Commission File Number 333-179079

AIRBORNE WIRELESS NETWORK

(Exact name of registrant as specified in its charter)

Nevada		27-4453740
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)
4115 Guardian Street, Suite C, Simi Valley, California		93063
(Address of principal executive offices)		(Zip Code)

(805) 583-4302 (Registrant’s telephone number, including area code) N/A (Former name, former address and former fiscal year, if changed since last report)

4115 Guardian Street, Suite C, Simi Valley, California		93063
(Address of principal executive offices)		(Zip Code)

(805) 583-4302

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	None	None

Indicate by 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), and (2) has been subject to such filing requirements for the past 90 days. x YES ¨ NO

Indicate by check mark whether the registrant has submitted electronically 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). x YES ¨ NO

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

Large accelerated filer	¨	Accelerated filer	x
Non-accelerated filer	¨	Smaller reporting company	x
		Emerging growth company	¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) ¨ YES x NO

~~The~~APPLICABLE ~~number~~ONLY ofTO ~~shares~~ISSUERS ~~outstanding~~INVOLVED ofIN ~~the issuer’s common stock, as of April 5, 2019 was 4,151,853,254~~BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

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. ¨ YES ¨ NO

APPLICABLE ONLY TO CORPORATE ISSUERS

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

The number of shares outstanding of the issuer’s common stock, as of July 3, 2019 was 4,862,692,652.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION			3
Item 1.	Financial Statements	3		3
Item 2.	Management'’s Discussion and Analysis of Financial Condition orand ~~Plan~~Results of ~~Operation~~Operations	21		18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30		29
Item 4.	Controls and Procedures	30		29
PART II - OTHER INFORMATION				30
Item 1.	Legal Proceedings	32		30
Item 1A.	Risk Factors	33		30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33		31
Item 3.	Defaults Upon Senior Securities	33		31
Item 4.	Mine Safety Disclosures	33		31
Item 5.	Other Information	33		31
Item 6.	Exhibits	34		32
SIGNATURES		35		33

2 Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. ~~Unaudited~~ Financial Statements

AIRBORNE WIRELESS NETWORK

~~INTERIM~~BALANCE ~~FINANCIAL STATEMENTS~~SHEETS

~~FEBRUARY 28, 2019~~(Unaudited)

(UNAUDITED)

	May 31,			August 31,
	2019			2018
Assets
Current Assets
Cash and cash equivalents	$	11,514		$	155,988
Prepaid expenses		54,740			1,019,650
Total Current Assets		66,254			1,175,638

Property and equipment, net		25,238			34,610

Total Assets	$	91,492		$	1,210,248

Liabilities and Stockholders’ Deficit
Current Liabilities
Accounts payable and accrued liabilities	$	8,840,644		$	4,909,419
Accrued interest		204,352			67,157
Convertible notes payable, net of unamortized debt discount of $0 and $863,852, respectively		1,756,006			976,229
Derivative liabilities		4,037,732			4,494,698
Total Current Liabilities		14,838,734			10,447,503

Total Liabilities		14,838,734			10,447,503

Commitments and Contingencies (note 9)

Stockholders’ Equity (Deficit)
Preferred stock, $0.001 par value, 10,000,000 shares authorized.
Series A Convertible Preferred Stock, $0.001 par value, $1,150 stated value, 1,000,000 shares authorized; 1,097 and 1,048 shares issued and outstanding as of May 31, 2019 and August 31, 2018, respectively		1			1
Common stock, $0.001 par value, 5,000,000,000,000 shares authorized; 4,527,275,986 and 684,342 shares issued and outstanding as of May 31, 2019 and August 31, 2018, respectively		4,527,275			684
Additional paid-in capital		111,033,389			104,574,113
Accumulated deficit		(130,307,907	)		(113,812,053	)
Total Stockholders’ Deficit		(14,747,242	)		(9,237,255	)

Total Liabilities and Stockholders’ Deficit	$	91,492		$	1,210,248

		Page
Balance Sheets		4
Statements of Operations		5
Statements of Stockholders’ Deficit		6
Statements of Cash Flows		8
Notes to the Unaudited Financial Statements		9

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

Table of Contents

AIRBORNE WIRELESS NETWORK

~~BALANCE~~STATEMENTS ~~SHEETS~~OF OPERATIONS

(Unaudited)

	February 28,			August 31,
	Three Months Ended						Nine Months Ended
	2019			2018
	May 31,						May 31,
Assets
	2019			2018			2019			2018
Current Assets
Revenue	$	-		$	-		$	-		$	-
Cash and cash equivalents	$	11,761		$	155,988
Operating Expense
Prepaid expenses and other assets		29,933			1,019,650
Marketing and branding		-			1,255,280			3,235,882			4,227,012
Total Current Assets		41,694			1,175,638
Depreciation		3,124			2,793			9,372			7,345
Property and equipment, net		28,362			34,610
General and administrative expenses		207,426			466,803			451,946			786,835
Total Assets	$	70,056		$	1,210,248
Management fees		-			60,000			-			102,000
Liabilities and Stockholders' Deficit
Professional fees		107,038			2,048,596			2,003,068			4,049,113
Current Liabilities
Research and development		-			18,100			55,141			588,042
Accounts payable and accrued liabilities	$	8,666,710		$	4,909,419
Salaries and wages		4,036			307,231			301,347			786,510
Accrued interest		149,213			67,157
Stock based compensation		1,624,387			6,317,452			8,563,096			44,278,826
Convertible notes payable, net of unamortized debt discount of $48,346 and $863,852, respectively		1,707,660			976,229
Total operating expense		1,946,011			10,476,255			14,619,852			54,825,683
Derivative liabilities		4,090,702			4,494,698
Operating Loss		(1,946,011	)		(10,476,255	)		(14,619,852	)		(54,825,683	)
Total Current Liabilities		14,614,285			10,447,503
Other income (expense)
Total Liabilities		14,614,285			10,447,503
Interest expense		(108,754	)		(3,193,927	)		(1,021,778	)		(4,755,835	)
Stockholders' Equity (Deficit)
Net change in fair value of derivative liabilities including day one losses		(28,271	)		7,576,117			(854,224	)		5,034,161
Preferred stock, $0.001 par value, 10,000,000 shares authorized.
Total other income (expense)		(137,025	)		4,382,190			(1,876,002	)		278,326
Series A Convertible Preferred Stock, $0.001 par value, $1,150 stated value, 1,000,000 shares authorized; 1,135 and 1,048 shares issued and outstanding as of February 28, 2019 and August 31, 2018, respectively		1			1
Net Loss	$	(2,083,036	)	$	(6,094,065	)	$	(16,495,854	)	$	(54,547,357	)
Common stock, $0.001 par value, 5,000,000,000,000 shares authorized; 3,701,872,193 and 684,342 shares issued and outstanding as of February 28, 2019 and August 31, 2018, respectively		3,701,872			684
Net loss per common share – basic and diluted	$	(0.00	)	$	(1,833	)	$	(0.01	)	$	(17,145	)
Additional paid-in capital		109,978,769			104,574,113
Weighted average number of common shares outstanding – basic and diluted		4,372,196,477			3,325			2,823,225,632			3,182
Accumulated deficit		(128,224,871	)		(113,812,053	)
Total Stockholders' Deficit		(14,544,229	)		(9,237,255	)
Total Liabilities and Stockholders' Deficit	$	70,056		$	1,210,248

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

Table of Contents

AIRBORNE WIRELESS NETWORK

STATEMENTS OF ~~OPERATIONS~~STOCKHOLDERS’ EQUITY (DEFICIT)

(Unaudited)

	Three Months Ended						Six Months Ended
	Series A Convertible												Additional
	February 28,						February 28,
	Preferred Stock						Common Stock						Paid-In			Accumulated
	2019			2018			2019			2018
	Shares			Amount			Shares			Amount			Capital			Deficit			Total
Revenue	$	-		$	-		$	-		$	-
Balance as of August 31, 2018		1,048		$	1			684,342		$	684		$	104,574,113		$	(113,812,053	)	$	(9,237,255	)
Operating Expense
Common stock converted from preferred stock		(749	)		(1	)		2,632,629,380			2,632,629			(2,632,628	)		-			-
Marketing and branding		4,499			1,882,452			3,235,882			2,971,732
Preferred stock units issued from the exercise of warrants		800			1			-			-			799,999			-			800,000
Depreciation		3,124			2,464			6,248			4,552
Common stock issued for services		-			-			46,242,792			46,243			(28,093	)		-			18,150
General and administrative expenses		87,321			205,290			244,521			320,032
Common stock issued for conversion of convertible notes – and accrued interest		-			-			257,544,764			257,545			(210,358	)		-			47,187
Management fees		-			42,000			-			42,000
Vesting of stock options issued to employees and consultants		-			-			-			-			4,292,178			-			4,292,178
Professional fees		393,262			1,143,232			1,896,030			2,000,517
Reclassification to additional paid in capital from derivative liability upon conversion of convertible notes		-			-			-			-			122,122			-			122,122
Research and development		-			284,053			55,141			569,942
Reclassification to additional paid in capital from derivative liability upon conversion of convertible preferred stock		-			-			-			-			1,032,555			-			1,032,555
Salaries and wages		75,717			250,064			297,311			479,279
Net loss for the three months ended November 30, 2018		-			-			-			-			-			(9,810,949	)		(9,810,949	)
Stock based compensation		2,628,380			31,998,849			6,938,708			37,961,374
Balance as of November 30, 2018		1,099		$	1			2,937,101,278		$	2,937,101		$	107,949,888		$	(123,623,002	)	$	(12,736,012	)
Total operating expense		3,192,303			35,808,404			12,673,841			44,349,428
Common stock converted from preferred stock		(54	)		-			752,727,276			752,727			(752,727	)		-			-
Operating Loss		(3,192,303	)		(35,808,404	)		(12,673,841	)		(44,349,428	)
Preferred stock units issued from the exercise of warrants		90			-			-			-			90,000			-			90,000
Other income (expense)
Common stock issued for services		-			-			12,043,639			12,044			(10,839	)		-			1,205
Interest expense		(348,721	)		(581,304	)		(913,024	)		(1,561,908	)
Vesting of stock options issued to employees and consultants		-			-			-			-			2,627,176			-			2,627,176
Net change in fair value of derivative liabilities including day one losses		(1,060,845	)		(2,006,888	)		(825,953	)		(2,541,956	)
Reclassification to additional paid in capital from derivative liability upon conversion of convertible preferred stock		-			-			-			-			75,272			-			75,272
Total other expense		(1,409,566	)		(2,588,192	)		(1,738,977	)		(4,103,864	)
Net loss for the three months ended February 28, 2019		-			-			-			-			-			(4,601,869	)		(4,601,869	)
Net Loss	$	(4,601,869	)	$	(38,396,596	)	$	(14,412,818	)	$	(48,453,292	)
Balance as of February 28, 2019		1,135		$	1			3,701,872,193		$	3,701,872		$	109,978,770		$	(128,224,871	)	$	(14,544,228	)
Net loss per common share – basic and diluted	$	(0.00	)	$	(12,128	)	$	(0.01	)	$	(15,585	)
Common stock converted from preferred stock		(58	)		-			812,405,305			812,405			(812,405	)		-			-
Weighted average number of common shares outstanding		3,324,836,985			3,166			2,035,903,430			3,109
Preferred stock units issued from the exercise of warrants		20			-			-			-			20,000			-			20,000
Common stock issued for services		-			-			12,998,488			12,998			(11,698	)		-			1,300
Vesting of stock options issued to employees and consultants		-			-			-			-			1,623,087			-			1,623,087
Debt forgiveness - related party		-			-			-			-			154,395			-			154,395
Reclassification to additional paid in capital from derivative liability upon conversion of convertible preferred stock		-			-			-			-			81,240			-			81,240
Net loss for the three months ended May 31, 2019		-			-			-			-			-			(2,083,036	)		(2,083,036	)
Balance as of May 31, 2019		1,097		$	1			4,527,275,986		$	4,527,275		$	111,033,389		$	(130,307,907	)	$	(14,747,242	)

~~The~~5 ~~accompanying~~Table ~~notes are an integral part~~ of ~~these unaudited interim financial statements.~~Contents

5 Table of Contents

	Series A Convertible										Additional
	Preferred Stock						Common Stock				Paid-In			Accumulated
	Shares			Amount			Shares		Amount		Capital			Deficit			Total
Balance as of August 31, 2017		-		$	-			3,022	$	3	$	37,235,403		$	(37,128,829	)	$	106,577

Common stock issued for exercise of warrants		-			-			15		-		484,000			-			484,000
Common stock issued for services		-			-			6		-		230,357			-			230,357
Common stock issued in conjunction with convertible notes		-			-			22		-		780,742			-			780,742
Vesting of stock options issued to employees and consultants		-			-			-		-		5,545,200			-			5,545,200
Stock warrants issued for services		-			-			-		-		36,772			-			36,772
Reclassification of derivative liability from additional paid in capital due to warrants		-			-			-		-		(2,078,065	)		-			(2,078,065	)
Net loss for the three months ended November 30, 2017		-			-			-		-		-			(10,056,696	)		(10,056,696	)
Balance as of November 30, 2017		-		$	-			3,065	$	3	$	42,234,409		$	(47,185,525	)	$	(4,951,113	)

Common stock units for cash		-			-			44		-		1,079,999			-			1,079,999
Common stock issued for exercise of warrants		-			-			63		-		1,108,124						1,108,124
Common stock issued for services		-			-			22		-		1,244,341			-			1,244,341
Common stock issued in conjunction with convertible notes		-			-			25		-		1,612,676			-			1,612,676
Vesting of stock options issued to employees and consultants		-			-			-		-		25,385,738			-			25,385,738
Reclassification to additional paid in capital from derivative liability upon exercise of warrants		-			-			-		-		2,905,132			-			2,905,132
Net loss for the three months ended February 28, 2018		-			-			-		-		-			(38,396,596	)		(38,396,596	)
Balance as of February 28, 2018		-		$	-			3,219	$	3	$	75,570,419		$	(85,582,121	)	$	(10,011,699	)

Preferred stock units issued for cash		8,000			8			-		-		6,714,479			-			6,714,487
Preferred stock converted to common stock		(942	)		(1	)		143		-		1			-			-
Common stock units for cash		-			-			1		-		65,001			-			65,001
Common stock issued for exercise of warrants		-			-			5		-		65,001			-			65,001
Common stock issued for services		-			-			69		-		1,352,261			-			1,352,261
Common stock issued in conjunction with convertible notes		-			-			7		-		(589,449	)		-			(589,449	)
Common stock issued for conversion of convertible notes		-			-			280		1		3,155,275			-			3,155,276
Vesting of stock options issued to employees and consultants		-			-			-		-		(8,883,563	)		-			(8,883,563	)
Net reduction of derivative liability from exercise of warrants		-			-			-		-		223,487			-			223,487
Reclassification to additional paid in capital from derivative liability upon conversion of convertible notes		-			-			-		-		3,626,032			-			3,626,032
Reclassification to additional paid in capital from derivative liability upon conversion of convertible preferred stock		-			-			-		-		1,013,661			-			1,013,661
Net loss for the three months ended May 31, 2018		-			-			-		-		-			(6,094,065	)		(6,094,065	)
Balance as of May 31, 2018		7,058		$	7			3,724	$	4	$	82,312,605		$	(91,676,186	)	$	(9,363,570	)

~~AIRBORNE~~The ~~WIRELESS~~accompanying ~~NETWORK~~notes are an integral part of these unaudited interim financial statements.

~~STATEMENTS~~6 OFTable ~~STOCKHOLDERS'~~of ~~DEFICIT~~Contents

~~For~~AIRBORNE ~~the~~WIRELESS ~~Three and Six Month periods ended February 28, 2019~~NETWORK

~~(Unaudited)~~STATEMENTS OF CASH FLOWS

	Series A Convertible										Additional
	Preferred Stock						Common Stock				Paid-In			Accumulated
	Shares			Amount			Shares		Amount		Capital			Deficit			Total
Balance as of August 31, 2018		1,048		$	1			684,342	$	684	$	104,574,113		$	(113,812,053	)	$	(9,237,255	)
Common stock converted from preferred stock		(749	)		(1	)		2,632,629,380		2,632,629		(2,632,628	)		-			-
Preferred stock units issued from the exercise of warrants		800			1			-		-		799,999			-			800,000
Common stock issued for services		-			-			46,242,792		46,243		(28,093	)		-			18,150
Common stock issued for conversion of convertible notes		-			-			257,544,764		257,545		(210,358	)		-			47,187
Vesting of stock options issued to employees and consultants		-			-			-		-		4,292,178			-			4,292,178
Reclassification to additional paid in capital from derivative liability upon conversion of convertible notes		-			-			-		-		122,122			-			122,122
Reclassification to additional paid in capital from derivative liability upon conversion of convertible preferred stock		-			-			-		-		1,032,555			-			1,032,555
Net loss for the three months ended November 30, 2018		-			-			-		-		-			(9,810,949	)		(9,810,949	)
Balance as of November 30, 2018		1,099		$	1			2,937,101,278	$	2,937,101	$	107,949,888		$	(123,623,002	)	$	(12,736,012	)
Common stock converted from preferred stock		(54	)		-			752,727,276		752,727		(752,728	)		-			(1	)
Preferred stock units issued from the exercise of warrants		90			-			-		-		90,000			-			90,000
Common stock issued for services		-			-			12,043,639		12,044		(10,839	)		-			1,205
Vesting of stock options issued to employees and consultants		-			-			-		-		2,627,176			-			2,627,176
Reclassification to additional paid in capital from derivative liability upon conversion of convertible preferred stock		-			-			-		-		75,272			-			75,272
Net loss for the three months ended February 28, 2019		-			-			-		-		-			(4,601,869	)		(4,601,869	)
Balance as of February 28, 2019		1,135		$	1			3,701,872,193	$	3,701,872	$	109,978,769		$	(128,224,871	)	$	(14,544,229	)

(Unaudited)

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

	Nine Months Ended
	May 31,
	2019			2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(16,495,854	)	$	(54,547,357	)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation		9,372			7,345
Stock-based compensation		8,563,096			44,278,826
Amortization of debt discount included in interest expense		863,852			4,573,723
Change in fair value of derivative liabilities		854,224			(5,034,161	)
Changes in operating assets and liabilities:
Prepaid expenses		964,910			(1,242,149	)
Accounts payable and accrued liabilities		3,931,224			523,504
Accrued interest		150,307			182,093
Net Cash Used in Operating Activities		(1,158,869	)		(11,258,176	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment		-			(19,731	)
Net Cash Used in Investing Activities		-			(19,731	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Advance from related parties		154,395			-
Proceeds from issuance of convertible notes, net		-			5,662,750
Repayment of convertible notes		(50,000	)		-
Proceeds from issuance of common stock units		-			1,144,999
Proceeds from exercise of warrants		-			1,657,125
Proceeds from the exercise of warrants		910,000			-
Proceeds from issuance of preferred stock units		-			6,714,487
Net Cash Provided by Financing Activities		1,014,395			15,179,361

Net change in cash and cash equivalents		(144,474	)		3,901,454
Cash and cash equivalents, beginning of period		155,988			217,694
Cash and cash equivalents, end of period	$	11,514		$	4,119,148

Supplemental cash flow information:
Cash paid for interest	$	-		$	-
Cash paid for taxes	$	-		$	-

Non-cash financing transactions:
Derivative liabilities recognized as debt discount	$	-		$	4,167,934
Common shares issued in conjunction with convertible notes recognized as debt discount	$	-		$	1,840,742
Common stock issued for conversion of debt and accrued interest	$	47,187		$	-
Common stock issued for conversion of preferred stock	$	4,197,761		$	-
Reclassification to additional paid in capital from derivative liability upon conversion of convertible notes	$	122,122		$	-
Reclassification to additional paid in capital from derivative liability upon conversion of convertible preferred stock	$	1,189,067		$	-
Reclassification to derivative liability from additional paid in capital due to warrants	$	-		$	2,078,065
Common stock issued for conversion of debt	$	-		$	3,155,275
Reduction of derivative liabilities from exercise of warrants, convertible notes and convertible preferred stock	$	-		$	7,731,540
Debt forgiveness - related party	$	154,395		$	-

6The ~~Table~~accompanying notes are an integral part of ~~Contents~~these unaudited interim financial statements.

~~AIRBORNE~~7 ~~WIRELESS~~Table ~~NETWORK~~of Contents

~~STATEMENTS~~AIRBORNE OFWIRELESS ~~STOCKHOLDERS' DEFICIT~~NETWORK

~~For~~NOTES ~~the~~TO ~~Three~~THE ~~and~~UNAUDITED ~~Six~~INTERIM ~~Month~~FINANCIAL ~~periods ended February 28, 2018~~STATEMENTS

~~(Unaudited)~~MAY 31, 2019

					Additional
	Common Stock				Paid-In			Accumulated
	Shares		Amount		Capital			Deficit			Total
Balance as of, August 31, 2017		3,022	$	3	$	37,235,403		$	(37,128,829	)	$	106,577
Common stock issued for exercise of warrants		15		-		484,000			-			484,000
Common stock issued for services		6		-		230,357			-			230,357
Common stock issued in conjunction with convertible notes		22		-		780,742			-			780,742
Vesting of stock options issued to employees		-		-		5,545,200			-			5,545,200
Stock warrants issued for services		-		-		36,772			-			36,772
Reclassification of derivative liability from additional paid in capital due to warrants		-		-		(2,078,065	)		-			(2,078,065	)
Net loss for the three months ended November 30, 2017		-		-		-			(10,056,696	)		(10,056,696	)
Balance as of November 30, 2017		3,065	$	3	$	42,234,409		$	(47,185,525	)	$	(4,951,113	)
Common stock units for cash		44		-		1,079,999			-			1,079,999
Common stock issued for exercise of warrants		63		-		1,108,124						1,108,124
Common stock issued for services		22		-		1,244,341			-			1,244,341
Common stock issued in conjunction with convertible notes		25		-		1,612,676			-			1,612,676
Vesting of stock options issued to employees and consultants		-		-		25,385,738			-			25,385,738
Reclassification to additional paid in capital from derivative liability upon exercise of warrants		-		-		2,905,132			-			2,905,132
Net loss for the three months ended February 28, 2018		-		-		-			(38,396,596	)		(38,396,596	)
Balance as of, February 28, 2018		3,219	$	3	$	75,570,419		$	(85,582,121	)	$	(10,011,699	)

NOTE 1 – ORGANIZATION, DESCRIPTION OF BUSINESS AND GOING CONCERN

~~The~~Airborne ~~accompanying~~Wireless ~~notes~~Network ~~are~~(the an“Company”) ~~integral~~is ~~part~~a ofNevada ~~these~~corporation ~~unaudited~~incorporated ~~interim~~on ~~financial~~January ~~statements~~5, 2011 under the name Ample-Tee. Effective on May 19, 2016, the Company’s corporate name was changed to Airborne Wireless Network. It is based in Simi Valley, California, USA. The Company’s fiscal year end is August 31.

7We ~~Table~~are an early stage company with the principal business strategy of ~~Contents~~developing, marketing and licensing a fully meshed, high-speed broadband airborne wireless network by linking commercial aircraft in flight. We call this network the “Infinitus Super HighwaySM” (“Infinitus”).

~~AIRBORNE~~Amended ~~WIRELESS~~and ~~NETWORK~~Restated Articles of Incorporation

~~STATEMENTS~~On OFJune ~~CASH~~28, ~~FLOWS~~2018, the stockholders of the Company approved an amendment (the “Amendment”) to the Company’s Amended and Restated Articles of Incorporation (as amended to date, the “Articles”) that increased the number of authorized shares of stock and granted the Company the right to effect up to five reverse stock splits of all of the Company’s issued and outstanding common stock until twelve (12) months from the filing of Certificate of Amendment to the Amended and Restated Articles of Incorporation with the Secretary of State of the State of Nevada on June 28, 2018. The number of shares of stock authorized under the Articles prior to the Amendment was 360,000,000, of which 350,000,000 were designated as common stock and 10,000,000 were designated as preferred stock. After giving effect to the Amendment, the number of authorized shares of all classes of stock the Company has authority to issue is 5,000,010,000,000, of which 5,000,000,000,000 are be designated as common stock and 10,000,000 are designated as preferred stock. Under the Amendment, the board of directors of the Company can effect up to five separate reverse splits of the Common Stock, each to be in a ratio of up to thirty thousand (30,000) to one (1), with any fractional shares to be rounded up to the next whole share, or paid in cash until June 28, 2019. Effective August 24, 2018, the Company effected a 30,000-for-one reverse stock split. All shares of common stock, the number of shares underlying options, warrants and other convertible securities and the per-share exercise price of such options, warrants and convertible securities disclosed in the financial statements retroactively reflect this reverse stock split.

~~(Unaudited)~~Going concern

	Six Months Ended
	February 28,
	2019			2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(14,412,818	)	$	(48,453,292	)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation		6,248			4,552
Stock-based compensation		6,938,708			37,961,374
Amortization of debt discount included in interest expense		815,506			1,469,387
Change in fair value of derivative liabilities		825,953			2,541,956
Changes in operating assets and liabilities:
Prepaid expenses and other assets		989,717			(463,704	)
Accounts payable and accrued liabilities		3,757,291			270,561
Accrued interest		95,168			92,521
Net Cash Used in Operating Activities		(984,227	)		(6,576,645	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment		-			(15,759	)
Net Cash Used in Investing Activities		-			(15,759	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of convertible notes, net		-			3,907,750
Repayment of convertible notes		(50,000	)		-
Proceeds from issuance of common stock units		-			1,079,999
Proceeds from exercise of warrants		-			1,592,124
Preferred stock units issued from the exercise of warrants		890,000			-
Net Cash Provided by Investing Activities		840,000			6,579,873
Net change in cash and cash equivalents		(144,227	)		(12,531	)
Cash and cash equivalents, beginning of period		155,988			217,694
Cash and cash equivalents, end of period	$	11,761		$	205,163
Supplemental cash flow information:
Cash paid for interest	$	-		$	-
Cash paid for taxes	$	-		$	800
Non-cash financing transactions:
Derivative liabilities recognized as debt discount	$	-		$	476,387
Common shares issued in conjunction with convertible notes recognized as debt discount	$	-		$	2,524,879
Common stock issued for conversion of debt	$	47,187		$	-
Common stock issued for conversion of preferred stock	$	3,385,357		$	-
Reclassification to additional paid in capital from derivative liability upon conversion of convertible notes	$	122,122		$	-
Reclassification to additional paid in capital from derivative liability upon conversion of convertible preferred stock	$	1,107,827		$	-
Reclassification to additional paid in capital from derivative liability upon exercise of warrants	$	-		$	2,905,132
Reclassification to derivative liability from additional paid in capital due to warrants	$	-		$	2,078,065
Common stock issued for services	$	-		$	1,474,698

The Company’s financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which contemplates the Company’s continuation as a going concern. The Company incurred operating losses of $16,495,854 during the nine months ended May 31, 2019 and has an accumulated deficit of $130,307,907 as of May 31, 2019.

~~The~~There ~~accompanying~~are ~~notes~~no ~~are~~assurances anthat ~~integral~~the ~~part~~Company will be able to either (1) achieve a level of ~~these~~revenues ~~unaudited~~adequate ~~interim~~to ~~financial~~generate ~~statements~~sufficient cash flow from operations; or (2) obtain additional financing through either private placements, public offerings and/or bank financing necessary to support its working capital requirements. To the extent that funds generated from operations and any private placements, public offerings and/or bank financing are insufficient, the Company will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to the Company. If adequate working capital is not available to the Company, it may be required to curtail or cease its operations.

8Due ~~Table~~to uncertainties related to these matters, there exists a substantial doubt about the ability of ~~Contents~~the Company to continue as a going concern. The accompanying unaudited interim financial statements do not include any adjustments related to the recoverability or classification of asset-carrying amounts or the amounts and classification of liabilities that may result should the Company be unable to continue as a going concern.

~~AIRBORNE~~NOTE ~~WIRELESS~~2 ~~NETWORK~~– SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

~~NOTES~~Basis TOof ~~THE~~Presentation ~~UNAUDITED~~of ~~INTERIM~~Interim ~~FINANCIAL~~Financial ~~STATEMENTS~~Statements

~~FEBRUARY~~The 28accompanying unaudited interim financial statements have been prepared in accordance with U.S. GAAP for interim financial information and in accordance with the instructions to Form 10-Q and Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the nine months ended May 31, 2019 are not necessarily indicative of the results that may be expected for the year ending August 31, 2019. Notes to the unaudited interim financial statements that would substantially duplicate the disclosures contained in the audited financial statements for fiscal year 2018 have been omitted. This report should be read in conjunction with the audited financial statements and the footnotes thereto for the fiscal year ended August 31, 2018 included in the Company’s Form 10-K as filed with the Securities and Exchange Commission on November 14, 2018.

~~NOTE~~8 1Table –of ~~ORGANIZATION, DESCRIPTION OF BUSINESS AND GOING CONCERN~~Contents

~~Airborne~~Use ~~Wireless~~of ~~Network~~Estimates ~~(the~~and “Company”) is a Nevada corporation incorporated on January 5, 2011 under the name Ample-Tee. Effective on May 19, 2016, the Company’s corporate name was changed to Airborne Wireless Network. It is based in Simi Valley, California, USA. The Company’s fiscal year end is August 31.Assumptions

WeThe ~~are~~preparation anof ~~early~~financial ~~stage~~statements ~~company~~in conformity with U.S. ~~the~~GAAP requires ~~principal~~management ~~business~~to ~~strategy~~make estimates and assumptions that affect the reported amounts of ~~developing,~~assets ~~marketing~~and liabilities and ~~licensing~~disclosure aof ~~fully~~contingent ~~meshed,~~assets ~~high-speed~~and ~~broadband~~liabilities ~~airborne~~at ~~wireless~~the ~~network~~date byof ~~linking~~the ~~commercial~~financial ~~aircraft~~statements inand ~~flight.~~the Wereported ~~call~~amounts ~~this~~of ~~network~~revenues and expenses during the ~~“Infinitus~~reporting ~~Super~~period. ~~HighwaySM”~~Actual ~~(“Infinitus”)~~results could differ from those estimates.

~~Amended~~Fair ~~and~~Value ~~Restated Articles~~ of ~~Incorporation~~Financial Instruments

OnThe ~~June 28, 2018, the stockholders of the~~ Company ~~approved an amendment (the “Amendment”) to the Company~~’s ~~Amended~~financial ~~and~~instruments ~~Restated~~consist ~~Articles~~primarily of ~~Incorporation (as amended to date~~cash, ~~the~~prepaid “Articles”) that increased the number of authorized shares of stock and granted the Company the right to effect up to five reverse stock splits of all of the Company’s issued and outstanding common stock until twelve (12) months from the filing of Certificate of Amendment to the Amended and Restated Articles of Incorporation with the Secretary of State of the State of Nevada on June 28expense, ~~2018.~~accounts ~~The~~payable ~~number of shares of stock authorized under the Articles prior to the Amendment was 360,000,000, of which 350,000,000 were designated as common stock~~ and ~~10,000,000~~accrued ~~were designated as preferred stock. After giving effect to the Amendment~~liabilities, ~~the number of authorized shares of all classes of stock the Company has authority to issue is 5,000,010,000,000, of which 5,000,000,000,000 are be designated as common stock~~ and ~~10,000,000~~convertible ~~are~~notes ~~designated as preferred stock~~payable. ~~Under~~The ~~the~~carrying ~~Amendment,~~amounts ~~the board~~ of ~~directors~~such offinancial ~~the~~instruments ~~Company~~approximate ~~can~~their ~~effect~~respective upestimated tofair ~~five~~value ~~separate~~due ~~reverse splits of the Common Stock, each~~ to ~~be in a ratio of up to thirty thousand (30,000) to one (1), with any fractional shares to be rounded up to~~ the ~~next whole share, or paid in cash until June 28, 2019. Effective August 24, 2018, the Company effected a 30,000~~short-~~for-one~~term ~~reverse~~maturities ~~stock split. All shares of common stock, the number of shares underlying options, warrants~~ and ~~other~~approximate ~~convertible~~market ~~securities~~interest ~~and~~rates ~~the per-share exercise price~~ of ~~such~~these ~~options, warrants and convertible securities disclosed in the financial statements retroactively reflect this reverse stock split~~instruments.

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

The ~~Company’s~~three-level ~~financial~~hierarchy ~~statements~~for ~~have~~fair ~~been~~value ~~prepared~~measurements inis ~~conformity~~defined ~~with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which contemplates the Company’s continuation~~ as ~~a going concern. The Company incurred operating losses of $14,412,818 during the six months ended February 28, 2019 and has an accumulated deficit of $128,224,871 as of February 28, 2019.~~follows:

~~There~~Level ~~are no assurances that the Company will be able to either (~~1) ~~achieve~~– ainputs ~~level of revenues adequate~~ to ~~generate~~the ~~sufficient~~valuation ~~cash~~methodology ~~flow~~are ~~from~~quoted ~~operations;~~prices or (2unadjusted) ~~obtain~~for ~~additional~~identical ~~financing~~assets ~~through either private placements, public offerings and/~~or ~~bank~~liabilities ~~financing~~in ~~necessary~~active tomarkets; ~~support~~liabilities ~~its~~in ~~working~~active capital requirements. To the extent that funds generated from operations and any private placements, public offerings and/or bank financing are insufficient, the Company will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to the Company. If adequate working capital is not available to the Company, it may be required to curtail or cease its operations.markets;

~~Due~~Level to2 ~~uncertainties~~– ~~related~~inputs to ~~these~~the ~~matters,~~valuation ~~there~~methodology ~~exists~~include aquoted ~~substantial~~prices ~~doubt~~for ~~about~~similar ~~the~~assets ~~ability~~and ofliabilities ~~the~~in ~~Company~~active tomarkets, ~~continue~~and asinputs athat ~~going~~are ~~concern.~~observable ~~The~~for ~~accompanying~~the ~~unaudited~~asset ~~interim~~or ~~financial~~liability ~~statements~~other dothan ~~not~~quoted ~~include~~prices, ~~any~~either ~~adjustments~~directly ~~related~~or toindirectly, ~~the~~including ~~recoverability~~inputs orin ~~classification~~markets ofthat ~~asset-carrying~~are ~~amounts~~not orconsidered ~~the~~to ~~amounts~~be ~~and~~active; ~~classification~~or ofdirectly ~~liabilities~~or ~~that~~indirectly ~~may~~including ~~result~~inputs ~~should~~in ~~the~~markets ~~Company~~that beare ~~unable~~not considered to ~~continue~~be ~~as a going concern.~~active;

9Level ~~Table~~3 of– ~~Contents~~inputs to the valuation methodology are unobservable and significant to the fair value measurement

~~NOTE~~The 2following –table ~~SUMMARY~~summarizes OFfair ~~SIGNIFICANT~~value ~~ACCOUNTING~~measurements ~~POLICIES~~by level at May 31, 2019, and August 31, 2018, measured at fair value on a recurring basis:

Basis of Presentation of Interim Financial Statements

May 31, 2019	Level 1		Level 2		Level 3		Total
Liabilities
Derivative Liabilities	$	-	$	-	$	4,037,732	$	4,037,732

The accompanying unaudited interim financial statements have been prepared in accordance with U.S. GAAP for interim financial information and in accordance with the instructions to Form 10-Q and Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the six months ended February 28, 2019 are not necessarily indicative of the results that may be expected for the year ending August 31, 2019. Notes to the unaudited interim financial statements that would substantially duplicate the disclosures contained in the audited financial statements for fiscal year 2018 have been omitted. This report should be read in conjunction with the audited financial statements and the footnotes thereto for the fiscal year ended August 31, 2018 included in the Company’s Form 10-K as filed with the Securities and Exchange Commission on November 14, 2018.

August 31, 2018	Level 1		Level 2		Level 3		Total
Liabilities
Derivative Liabilities	$	-	$	-	$	4,494,698	$	4,494,698

~~Use~~Research ~~of Estimates~~ and ~~Assumptions~~Development Expenses

~~The~~We ~~preparation~~follow ofASC ~~financial~~730-10, ”Research ~~statements~~and inDevelopment,” and ~~conformity~~expense ~~with~~research ~~accounting~~and ~~principles~~development ~~generally~~costs ~~accepted~~when inincurred. ~~the~~Accordingly, ~~United~~third-party ~~States~~research ofand ~~America~~development ~~requires~~costs, ~~management~~including todesigning, ~~make~~prototyping ~~estimates~~ and ~~assumptions~~testing ~~that~~of ~~affect~~product, are expensed when the ~~reported~~contracted ~~amounts~~work ofhas ~~assets~~been ~~and~~performed ~~liabilities~~or ~~and~~milestone ~~disclosure~~results ofhave ~~contingent~~been ~~assets~~achieved. ~~and~~Indirect ~~liabilities~~costs atare ~~the~~allocated ~~date~~based ofon ~~the~~percentage ~~financial~~usage ~~statements~~related ~~and~~to the ~~reported~~research ~~amounts~~and development. Research and development costs of ~~revenues~~$55,141 and ~~expenses~~$588,042 ~~during~~were incurred for the ~~reporting~~nine ~~period.~~months ~~Actual~~ended ~~results~~May ~~could~~31, ~~differ~~2019 ~~from~~and ~~those~~2018, ~~estimates~~respectively.

~~Fair~~Stock-Based ~~Value of Financial Instruments~~Compensation

~~The~~ASC ~~Company’s~~718, ”Compensation ~~financial~~- ~~instruments~~Stock ~~consist~~Compensation,” prescribes ~~primarily~~accounting ofand ~~cash,~~reporting ~~prepaid~~standards ~~expense,~~for ~~deferred~~all ~~financing~~share-based ~~cost,~~payment ~~accounts~~transactions ~~payable~~in ~~and~~which ~~accrued~~employee services are acquired. Transactions include incurring liabilities, ~~accrued~~or ~~expenses~~issuing or offering to issue shares, ~~convertible~~options ~~notes~~and other equity instruments such as employee stock ownership plans and ~~notes~~stock ~~payable~~appreciation rights. ~~The~~Share-based ~~carrying~~payments ~~amounts~~to employees, including grants of ~~such~~employee stock options, are recognized as compensation expense in the financial ~~instruments~~statements ~~approximate~~based on their ~~respective~~fair ~~estimated~~values. ~~fair~~That ~~value~~expense ~~due~~is recognized over the period during which an employee is required to provide services in exchange for the ~~short-term~~award, ~~maturities~~known ~~and~~as ~~approximate~~the ~~market~~requisite ~~interest~~service ~~rates~~period of(usually ~~these~~the ~~instruments~~vesting period).

~~The~~9 ~~Company~~Table adopted ASC Topic 820, Fair Value Measurements (“ASC Topic 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The standard provides a consistent definition of fair value which focuses on an exit price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard also prioritizes, within the measurement of fair value, the use of market-based information over entity specific information and establishes a three-level hierarchy for fair value measurements based on the nature of inputs used in the valuation of an asset or liability as of the measurement date.Contents

The ~~three-level~~Company ~~hierarchy~~accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, ”Equity - Based Payments to Non-Employees.” Measurement of share-based payment transactions with non-employees is based on the fair value ~~measurements~~of whichever is ~~defined~~more asreliably ~~follows~~measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

~~Level~~Stock-based 1compensation –incurred ~~inputs~~for to the ~~valuation~~nine ~~methodology~~months ~~are~~ended ~~quoted~~May ~~prices~~31, ~~(unadjusted)~~2019 ~~for~~and ~~identical~~2018, ~~assets~~respectively, orare ~~liabilities~~summarized inas ~~active markets; liabilities in active markets;~~follows:

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

	Nine Months Ended
	May 31,
	2019		2018

Stock options issued to employees, strategic service provider and consultants	$	8,542,442	$	22,047,376
Stock warrants issued to investors and consultants		-		19,404,490
Common stock issued to strategic service providers and consultants		20,654		2,826,960
Total	$	8,563,096	$	44,278,826

~~Level~~Recently 3Issued –Accounting ~~inputs to the valuation methodology are unobservable and significant to the fair value measurement~~Pronouncements

In August 2018, the Financial Accounting Standards Board issued ASU 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement.” The ~~following~~ASU ~~table~~modifies ~~summarizes~~the ~~fair~~disclosure ~~value~~requirements ~~measurements~~in byTopic ~~level~~820, at“Fair ~~February~~Value 28Measurement,” ~~2019~~by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty and ~~August~~adding ~~31,~~new ~~2018~~disclosure requirements, ~~measured~~such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. The Company is currently evaluating the effect, if any, that the ASU will have on aits ~~recurring~~financial ~~basis:~~statements.

February 28, 2019	Level 1		Level 2		Level 3		Total
Liabilities
Derivative Liabilities	$	-	$	-	$	4,090,702	$	4,090,702

In February 2016, the FASB issued ASU No. 2016-02 Leases (Topic 842) intended to improve financial reporting around leasing transactions. The ASU affects all companies and other organizations that lease assets such as real estate, airplanes, and manufacturing equipment. The ASU will require organizations that lease assets - referred to as “lessees”- to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. For public companies, the standard is effective for fiscal years beginning after December 15, 2018 and interim periods therein. Earlier adoption is permitted for any annual or interim period for which financial statements have not yet been issued. The Company will adopt this ASU beginning on September 1, 2019 and will utilize the modified retrospective transition approach, as prescribed within this ASU.

August 31, 2018	Level 1		Level 2		Level 3		Total
Liabilities
Derivative Liabilities	$	-	$	-	$	4,494,698	$	4,494,698

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

10NOTE ~~Table~~3 of– ~~Contents~~PREPAID EXPENSES

~~Research~~Prepaid expenses relate to prepayment made for future services in advance and ~~Development~~will ~~Expenses~~be expensed over time as the benefit of the services is received in the future, expected within one year.

WePrepaid ~~follow~~expenses ~~ASC~~consisted 730-10, ”Research and Development,” and expense research and development costs when incurred. Accordingly, third-party research and development costs, including designing, prototyping and testing of ~~product, are expensed when~~ the ~~contracted~~following ~~work~~at ~~has~~May ~~been performed or milestone results have been achieved. Indirect costs are allocated based on percentage usage related to the research and development. Research and development costs of $55~~31,~~141~~ ~~and $569,942 were incurred for the six months ended February 28,~~ 2019 and ~~2018~~August 31, ~~respectively.~~2018:

Stock-Based Compensation

	May 31,		August 31,
	2019		2018
Legal and regulatory fees	$	54,740	$	255,500
Marketing and branding		-		712,900
Rent expense		-		22,550
Professional fees		-		28,700
	$	54,740	$	1,019,650

~~ASC~~NOTE ~~718, ”Compensation~~4 -– ~~Stock~~ACCOUNTS ~~Compensation,” prescribes~~PAYABLE ~~accounting~~AND ~~and~~ACCRUED reporting standards for all share-based payment transactions in which employee services are acquired. Transactions include incurring liabilities, or issuing or offering to issue shares, options and other equity instruments such as employee stock ownership plans and stock appreciation rights. Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).LIABILITIES

~~The~~Accounts ~~Company~~payable ~~accounts for stock-based compensation issued to non-employees~~ and ~~consultants~~accrued inliabilities ~~accordance~~consisted ~~with the provisions~~ of ~~ASC 505-50, ”Equity - Based Payments to Non-Employees.” Measurement of share-based payment transactions with non-employees is based on~~ the ~~fair~~following ~~value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined~~ at ~~the~~May ~~earlier~~31, of2019 ~~performance~~and ~~commitment~~August ~~date~~31, ~~or performance completion date.~~2018:

Stock-based compensation incurred for the six months ended February 28, 2019 and 2018, respectively, are summarized as follows:

	May 31,		August 31,
	2019		2018
Trade Payables	$	8,528,896	$	4,796,784
Credit Card Payable		241,788		37,675
Other Payable		69,960		74,960
Total	$	8,840,644	$	4,909,419

	Six Months Ended
	February 28,
	2019		2018
Stock options issued to employees, strategic service provider and consultants	$	6,919,354	$	30,930,938
Stock warrants issued to investors and consultants		-		5,555,738
Common stock issued to strategic service providers and consultants		19,354		1,474,698
Total	$	6,938,708	$	37,961,374

Table of Contents

~~Recently~~NOTE ~~Issued~~5 ~~Accounting~~– ~~Pronouncements~~EQUITY

InAuthorized August 2018, the Financial Accounting Standards Board issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. The ASU modifies the disclosure requirements in Topic 820, Fair Value Measurement, by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements, such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. The Company is currently evaluating the effect, if any, that the ASU will have on its financial statements.Stock

~~Management~~The ~~has~~Company ~~considered~~is ~~all~~authorized ~~other~~to ~~recent~~issue ~~accounting~~an ~~pronouncements~~aggregate ~~issued.~~of ~~The~~5,000,000,000,000 ~~Company’s~~common ~~management~~shares ~~believes~~and ~~that~~10,000,000 ~~these~~shares ~~recent~~of ~~pronouncements~~preferred ~~will~~stock, ~~not~~each ~~have~~with a ~~material~~par ~~effect~~value of $0.001 per share. Each common share entitles the holder to one vote on any matter on which action of the ~~Company’s~~stockholders ~~unaudited~~of ~~interim~~the ~~financial~~corporation ~~statements~~is sought.

11Series ~~Table~~A ofConvertible ~~Contents~~Preferred stock

~~NOTE~~The 3Company –is ~~PREPAID~~authorized ~~EXPENSES~~to issue 1,000,000 shares of Series A Convertible Preferred Stock at a par value of $0.001 and a stated value equal to $1,150 per share.

~~Prepaid~~· ~~expenses~~The ~~relate~~Series A Convertible Preferred Stock ranks senior to ~~prepayment~~our ~~made~~common ~~for~~stock ~~future~~and ~~services~~other inclasses ~~advance~~of capital stock with respect to dividend and redemption. · Holders of the Series A Convertible Preferred Stock will only be ~~expensed~~entitled ~~over~~to ~~time~~receive any dividends on the Series A Preferred Stock when, as, and if the ~~benefit~~board of ~~the~~directors ~~services~~declares such dividends. · The Series A Convertible Preferred Stock is ~~received~~convertible ininto shares of common stock by dividing the ~~future~~stated value per share ($1,150) ~~expected~~by ~~within~~the ~~one~~lesser ~~year~~of $0.71 per share or 82.5% of the lowest volume weighted average price for our common stock as reported at the close of trading on the market reporting trade prices for the common stock during the five trading days ending on and including the day the notice of conversion is delivered. · A holder of Series A Convertible Preferred Stock has the same voting rights as a holder of common stock on a fully converted basis not to exceed the beneficial ownership limitation.

~~Prepaid~~On May 29, 2018, the Company issued 8,000 units for aggregate net proceeds of $6.7 million, after deducting underwriting discounts and other expenses of the offering. Each unit consisted of ~~the~~one ~~following~~share atof ~~February~~Series 28A Preferred Stock, ~~2019~~one Series 1 warrant to purchase one share of Series A Preferred Stock, one Series 2 warrant to purchase one share of Series A Preferred Stock and ~~August~~one 31Series 3 warrant to purchase one share of Series A Preferred Stock (“Series 1, ~~2018:~~2 and 3 warrants”). The Company also issued to the underwriter of the offering a warrant to purchase 640 units.

	February 28,		August 31,
	2019		2018
Legal and regulatory fees	$	29,933	$	255,500
Marketing and branding		-		712,900
Rent expense		-		22,550
Professional fees		-		28,700
	$	29,933	$	1,019,650

The Company determined that the Series A Convertible Preferred Stock qualifies for derivative accounting which led to no explicit limit to the number of shares to be delivered upon future settlement of the conversion options (See Note 8).

~~NOTE~~During the nine months ended May 31, 2019, 861 shares of Series A Convertible Preferred Stock were converted into 4,197,761,961 –shares ~~ACCOUNTS~~of ~~PAYABLE~~common ~~AND~~stock. ~~ACCRUED~~The ~~LIABILITIES~~corresponding derivative liability at the dates of conversion of $1,189,067 was credited to additional paid in capital.

~~Accounts~~As ~~payable~~of May 31, 2019 and ~~accrued~~August ~~liabilities~~31, ~~consisted~~2018, 1,097 and 1,048 shares of ~~the~~Series ~~following~~A atConvertible ~~February~~Preferred ~~28,~~Stock ~~2019~~were issued and ~~August 31~~outstanding, ~~2018:~~respectively.

	February 28,		August 31,
	2019		2017
Trade Payables	$	8,528,894	$	4,796,784
Credit Card Payable		67,856		37,675
Other Payable		69,960		74,960
Total	$	8,666,710	$	4,909,419

Warrants Exercisable into Preferred A Stock

~~NOTE~~Each 5warrant –is ~~EQUITY~~immediately exercisable into one share of Series A Convertible Preferred Stock at a price of $1,000 per share. On May 29, 2019, the Series 1, 2 and 3 warrant expired.

~~Authorized~~The ~~Stock~~below table summarizes warrant activity during the nine months ended May 31, 2019:

The Company is authorized to issue an aggregate of 5,000,000,000,000 common shares and 10,000,000 shares of preferred stock, each with a par value of $0.001 per share. Each common share entitles the holder to one vote on any matter on which action of the stockholders of the corporation is sought.

	Number of warrants									Weighted- Average Exercise Price
	Series 1			Series 2			Series 3			Series 1			Series 2			Series 3
Balances as of August 31, 2018		7,500			7,900			8,000		$	1,000		$	1,000		$	1,000
Granted		-			-			-			-			-			-
Exercised		-			(200	)		(710	)		1,000			1,000			1,000
Expired		(7,500	)		(7,700	)		(7,290	)		(1,000	)		(1,000	)		(1,000	)
Balances as of May 31, 2019		-			-			-		$	-		$	-		$	-

During the nine months ended May 31, 2019, 200 Series 2 warrants were exercised into 200 shares of Series A Convertible Preferred ~~stock~~Stock and 710 Series 3 warrants were exercised into 710 shares of Series A Convertible Preferred Stock for an aggregate net proceeds of $910,000.

~~The~~11 ~~Company~~Table ~~is authorized to issue 1,000,000 shares~~ of ~~Series A Convertible Preferred Stock at a par value of $0.001 and a stated value equal to $1,150 per share.~~Contents

·Common ~~The Series A Convertible Preferred Stock ranks senior to our common~~ stock and other classes of capital stock with respect to dividend and redemption. · Holders of the Series A Convertible Preferred Stock will only be entitled to receive any dividends on the Series A Preferred Stock when, as and if the board of directors declares such dividends. · The Series A Convertible Preferred Stock is convertible into shares of common stock by dividing the stated value per share ($1,150) by the lesser of $0.71 per share or 82.5% of the lowest volume weighted average price for our common stock as reported at the close of trading on the market reporting trade prices for the common stock during the five trading days ending on and including the day the notice of conversion is delivered. · A holder of Series A Convertible Preferred Stock has the same voting rights as a holder of common stock on a fully converted basis not to exceed the beneficial ownership limitation.

~~12 Table of Contents~~Issuances

OnDuring the nine months ended May 2931, ~~2018~~2019, the Company issued 84,~~000 units for aggregate net proceeds of $6.7 million~~526, ~~after deducting underwriting discounts and other expenses of the offering. Each unit consisted of one share of Series A Preferred Stock~~591,644 ~~one~~shares ~~Series 1 warrant to purchase one share~~ of ~~Series~~common ~~A Preferred Stock~~stock, ~~one~~as Series 2 warrant to purchase one share of Series A Preferred Stock and one Series 3 warrant to purchase one share of Series A Preferred Stock (“Series 1, 2 and 3 warrants”). The Company also issued to the underwriter of the offering a warrant to purchase 640 units.follows:

~~The~~· ~~Company~~71,284,919 ~~determined~~shares ~~that~~of ~~the~~common ~~Series~~stock Ato ~~Convertible~~strategic ~~Preferred~~service ~~Stock~~providers, ~~qualifies~~ for ~~derivative~~services ~~accounting~~valued ~~which~~at ~~led~~$20,655. to· no4,197,761,961 ~~explicit~~shares ~~limit~~of tocommon stock issued for the ~~number~~conversion of 861 shares toof beSeries ~~delivered~~A ~~upon~~Convertible ~~future~~Preferred ~~settlement~~Stock. · 257,544,764 shares of common stock issued upon the conversion ~~options~~of ~~(See~~convertible ~~Note~~notes 8)in aggregate principal amount of $34,075 and accrued interest of $13,112.

~~During~~As ~~the~~at ~~six~~May ~~months ended February 28~~31, 2019, ~~803~~and ~~shares~~August of31, ~~Series~~2018, Athe ~~Convertible~~Company ~~Preferred~~had ~~Stock were converted into 3~~4,~~385~~527,~~356~~275,~~656~~986 and 684,342 shares of common stock. ~~The~~issued ~~corresponding~~and ~~derivative liability at the dates of conversion of $1~~outstanding,~~107,827~~ ~~was credited to additional paid in capital~~respectively.

AsWarrants ofExercisable ~~February~~to ~~28,~~Common ~~2019, and August 31, 2018, 1,135 and 1,048 shares of Series A Convertible Preferred Stock were issued and outstanding, respectively.~~Shares

~~Warrants~~The ~~Exercisable~~below ~~into~~table ~~Preferred~~summarizes Athe ~~Stock~~activity of warrants exercisable for common shares during the nine months ended May 31, 2019:

Each warrant is immediately exercisable into one share of Series A Convertible Preferred Stock at a price of $1,000 per share. The Series 1 Warrants will expire on the 90-day anniversary of the issuance date. The Series 2 Warrants will expire on the six-month anniversary of the issuance date. The Series 3 Warrants will expire on the 12-month anniversary of the issuance date. During the three months ended November 30, 2018, the Company amended the expiry date of Series 1, 2 and 3 warrant to May 29, 2019.

	Number of Shares			Weighted- Average Exercise Price
Balances as of August 31, 2017		119		$	48,900
Granted		3,513			4,505
Exercised		(92	)		40,823
Forfeited		(231	)		46,862
Balances as of August 31, 2018		3,309		$	1,196
Granted		9			57,000
Exercised		-			-
Forfeited		-			-
Balances as of May 31, 2019		3,318		$	2,295

The ~~below~~fair ~~table~~value ~~summarizes~~of each warrant ~~activity~~on ~~during~~the date of grant is estimated using the ~~six~~Black-Scholes ~~months~~option ~~ended~~valuation ~~February~~model. ~~28,~~The ~~2019~~following ~~and~~weighted-average assumptions were used for options granted during the year ended August 31, 2018:

	Number of warrants								Weighted- Average Exercise Price
	Year Ended
	Series 1		Series 2			Series 3			Series 1		Series 2		Series 3
	August 31,
Balances as of August 31, 2018		7,500		7,900			8,000		$	1,000	$	1,000	$	1,000
	2018
Granted		-		-			-			-		-		-
Exercise price	$10.2 - $97,500
Exercised		-		(200	)		(690	)		1,000		1,000		1,000
Remaining contractual term	1.49 - 5 years
Forfeited		-		-			-			-		-		-
Expected average volatility	124%-354%
Balances as of February 28, 2019		7,500		7,700			7,310		$	1,000	$	1,000	$	1,000
Expected dividend yield	-
Risk-free interest rate	0.98% - 2.83%

The following table summarizes information relating to outstanding and exercisable warrants as of ~~February~~May 2831, 2019:

Warrants Outstanding	~~Warrants Outstanding~~					Warrants Exercisable				~~Warrants Exercisable~~
	Weighted Average				~~Weighted Average~~			~~Weighted~~				~~Weighted~~
Number	~~Number~~Remaining Contractual			Weighted Average	~~Remaining~~	Number		Weighted Average		~~Number~~		~~Average~~
of Shares	oflife ~~Shares~~(in years)			Exercise Price	~~life (in Months)~~	of Shares		Exercise Price		~~of Shares~~		~~Exercise Price~~
Series 1		7,500				2.96		$	1,000		7,500	$	1,000
3,318	2.14		$	2,295		3,318	$	2,295
Series 2		7,700				2.96		$	1,000		7,700	$	1,000
Series 3		7,310				2.96		$	1,000		7,310	$	1,000

~~During~~Aggregate intrinsic value is the ~~six~~sum ~~months~~of ~~ended~~the ~~February~~amounts ~~28,~~by ~~2019,~~which ~~200~~the ~~Series~~quoted 2market ~~warrants~~price ~~were~~of ~~exercised~~the ~~into~~Company’s ~~200~~stock ~~shares~~exceeded ofthe ~~Series~~exercise Aprice ~~Convertible~~of ~~Preferred~~the ~~Stock~~warrants ~~and~~at ~~690~~May ~~Series~~31, 32019 for those warrants ~~were~~for ~~exercised~~which ~~into~~the ~~690~~quoted ~~shares~~market price was in excess of ~~Series~~the Aexercise ~~Convertible~~price ~~Preferred~~(“in-the-money” ~~Stock~~warrants). ~~for~~As anof May 31, 2019, the aggregate ~~net~~intrinsic ~~proceeds~~value of warrants outstanding was approximately $~~890~~0 based on the closing market price of $0.0001 on May 31,~~000~~ 2019.

13The ~~Table~~Company determined that the warrants qualify for derivative accounting as a result of ~~Contents~~the related issuances of convertible notes, which led to no explicit limit to the number of shares to be delivered upon future settlement of the conversion options.

~~Common~~12 ~~stock~~Table of Contents

~~Issuances~~NOTE 6 – STOCK COMPENSATION PLANS

~~During~~In the ~~six~~ordinary ~~months~~course ~~ended~~of ~~February 28~~business, ~~2019,~~ the Company ~~issued~~may 3issue stock options to employees,~~701,187,851~~ ~~shares~~officers and directors from time to time. Fair values of ~~common~~the stock option awards are based on the associated value of the services rendered, aswhere ~~follows:~~reasonably determinable.

·Equity ~~58,286,431~~Compensation ~~shares~~Not ofApproved ~~common~~by ~~stock~~Security to strategic service providers, for services valued at $19,354. · 3,385,356,656 shares of common stock issued for the conversion of 803 shares of Series A Convertible Preferred Stock. · 257,544,764 shares of common stock issued upon the conversion of convertible notes in aggregate principal amount of $34,075 and accrued interest of $13,112.Holders

AsDuring atthe ~~February~~nine 28months ended May 31, 2019 and the year ended August 31, 2018, ~~the~~options ~~Company~~to ~~had~~purchase ~~3,701,872,193~~0 and ~~684,342~~339 shares of our common stock, ~~issued~~respectively, ~~and~~had ~~outstanding~~been granted to our employees, ~~respectively~~officers and directors under equity compensation not approved by security holders.

~~Warrants~~Options ~~Exercisable~~issued tohad ~~Common~~the ~~Shares~~following terms:

The below table summarizes the activity of warrants exercisable for common shares during the six months ended February 28, 2019 and the year ended August 31, 2018:

		Year Ended
		August 31,
		2018
Exercise price		$15,000 - $97,500
Time to vest		On issuance – 4 years
Expiration after vesting		5 years

	Number of Shares			Weighted- Average Exercise Price
Balances as of August 31, 2017		119		$	48,900
Granted		3,513			4,505
Exercised		(92	)		40,823
Forfeited		(231	)		46,862
Balances as of August 31, 2018		3,309		$	1,196
Granted		6			57,000
Exercised		-			-
Forfeited		-			-
Balances as of February 28, 2019		3,315		$	2,245

2017 Equity Incentive Plan

On July 30, 2017, the Board of Directors of the Company approved, and on July 31, 2017 the stockholders of the Company approved, the Airborne Wireless Network 2017 Stock Option Plan (the “2017 Plan”). The 2017 Plan permits the Company to issue up to 334 shares of common stock upon exercise of options granted to selected employees, officers, directors, consultants and advisers. The options may be either “incentive stock options” (as such term is defined in the Internal Revenue Code of 1986) or options that are not intended to qualify as “incentive stock options” (these are referred to as “non-qualified options”). Incentive stock options may be granted only to employees. The 2017 Plan is administered by the Board or, at the discretion of the Board, a Board committee. The administrator determines who will receive options and the terms of the options, including the exercise price, expiration date, vesting and the number of shares. The exercise price of each stock option may not be less than the fair market value of ~~each~~the ~~warrant~~Common Stock on the date of grant, isalthough ~~estimated~~the ~~using~~exercise ~~the~~price ~~Black-Scholes~~of any incentive stock option ~~valuation~~granted ~~model~~to a 10% stockholder may not be less than 110% of the fair market value on the grant date. Options may be exercisable (“vest”) immediately or in increments based on time and/or performance criteria as determined by the administrator. The ~~following~~term ~~weighted-average~~of ~~assumptions~~any ~~were~~option ~~used~~may not exceed 10 years (five years for ~~options~~any incentive stock option granted ~~during~~to a 10% stockholder), and unless otherwise determined by the administrator, each option must terminate no later than three months after the termination of the optionee’s employment (one year ~~ended~~in ~~August~~the event of death or disability). Subject to a few minor exceptions, options may not be transferred other than by will or by the laws of descent and distribution. The 2017 Plan will expire on December 31, ~~2018:~~2026.

	Year Ended
	August 31,
	2018
Exercise price	$10.2 - $97,500
Remaining contractual term	1.49 - 5 years
Expected average volatility	124%-354%
Expected dividend yield		-
Risk-free interest rate	0.98% - 2.83%

On December 30, 2017, the Company granted options to directors (see below) to purchase an aggregate of 14 shares of our common stock at a price of $59,400 per share vesting immediately on December 31, 2017. The options expire December 29, 2022, unless such director ceases his or her service as a director prior the exercise or expiration of the option.

14As ~~Table~~ of ~~Contents~~May 31, 2019, there were 320 shares available for future grant under the 2017 Plan.

~~The~~Stock ~~following table summarizes information relating to outstanding and exercisable warrants as of February 28, 2019:~~Options

Warrants Outstanding

Warrants Exercisable

Weighted Average

Number

Remaining Contractual

Weighted Average

Number

Weighted Average

of Shares

life (in years)

Exercise Price

of Shares

Exercise Price

3,315

2.39

2,245

3,315

2,245

During the nine months ended May 31, 2019, the Company did not grant options and during the year ended August 31, 2018, the Company granted options with an aggregate fair value of $19,412,264, which are being amortized into compensation expense over the vesting period of the options as the services are being provided.

~~Aggregate~~The ~~intrinsic~~following ~~value~~ is ~~the~~a ~~sum~~summary of ~~the amounts by which the quoted market price of the Company’s~~ stock ~~exceeded~~option ~~the~~activity ~~exercise~~during ~~price of~~ the ~~warrants~~nine atmonths ~~February~~ended ~~28,~~May ~~2019 for those warrants for which the quoted market price was in excess of the exercise price (“in-the-money” warrants). As of February 28~~31, 2019, ~~the~~and ~~aggregate intrinsic value of warrants outstanding was approximately $0 based on~~ the ~~closing~~year ~~market~~ended ~~price~~August ~~of $0.0001 on February 28~~31, ~~2019.~~2018:

The Company determined that the warrants qualify for derivative accounting as a result of the related issuances of convertible notes, which led to no explicit limit to the number of shares to be delivered upon future settlement of the conversion options.

	Options Outstanding
	Number of Options			Weighted- Average Exercise Price		Fair Value on Grant Date			Intrinsic Value
Balances as of August 31, 2017		946		$	98,700	$	35,864,990			-
Granted		339			66,000		19,412,264			-
Exercised		-			-		-			-
Forfeited		(2	)		37,200		(67,894	)		-
Balances as of August 31, 2018		1,283		$	58,500	$	55,209,360		$	-
Granted		-			-		-			-
Exercised		-			-		-			-
Forfeited		-			-		-			-
Balances as of May 31, 2019		1,283		$	58,504	$	55,209,360		$	-

~~NOTE~~13 6Table –of ~~STOCK COMPENSATION PLANS~~Contents

InThe ~~the~~following ~~ordinary~~table ~~course~~summarizes ofinformation ~~business,~~relating ~~the~~to ~~Company~~exercisable ~~may issue~~ stock options toas ~~employees, officers and directors from time to time. Fair values~~ of ~~the~~May ~~stock option awards are based on the associated value of the services rendered~~31, ~~where reasonably determinable.~~2019:

Equity Compensation not approved by security holders

Options Exercisable
Number of Options	Weighted Average Exercise Price
968	$	53,222

~~During~~Aggregate intrinsic value is the ~~six~~sum ~~months~~of ~~ended~~the ~~February~~amounts ~~28,~~by ~~2019~~which ~~and~~the quoted market price of the ~~year~~Company’s ~~ended~~stock ~~August~~exceeded ~~31,~~the ~~2018,~~exercise price of the stock options toexercisable ~~purchase~~at 0May ~~and~~31, ~~339~~2019. ~~shares~~As of ~~our~~May ~~common stock~~31, ~~respectively~~2019, ~~had~~the ~~been~~aggregate ~~granted~~intrinsic tovalue ~~our~~of ~~employees,~~stock ~~officers~~options ~~and~~outstanding ~~directors under~~was ~~equity~~$0 ~~compensation~~based ~~not~~on ~~approved~~the byclosing ~~security~~market ~~holders~~price of $0.0001 on May 31, 2019.

~~Options~~Weighted-average ~~issued~~grant-date ~~had~~fair ~~the~~value ~~following~~for ~~terms~~non-vested stock options as of May 31, 2019 and August 31, 2018 were listed as follows:

	Year Ended
	Shares			Weighted-Average Grant Date Fair Value Per Share
	August 31,
Unvested, August 31, 2017		809		$	38,100
	2018
Granted		339			57,300
Exercise price	$15,000 - $97,500
Vested		(473	)		43,800
Time to vest	On issuance – 4 years
Forfeited		-			-
Expiration after vesting	5 years
Unvested, August 31, 2018		675		$	43,800
Granted		-			-
Vested		(360	)		64,021
Forfeited		-			-
Unvested, May 31, 2019		315		$	74,738

~~2017~~The ~~Equity~~fair ~~Incentive~~value ~~Plan~~of each option on the date of grant is estimated using the Black-Scholes option valuation model. The following weighted-average assumptions were used for options granted during the year ended August 31, 2018 and 2017:

On July 30, 2017, the Board of Directors of the Company approved, and on July 31, 2017 the stockholders of the Company approved, the Airborne Wireless Network 2017 Stock Option Plan (the “2017 Plan”). The 2017 Plan permits the Company to issue up to 334 shares of common stock upon exercise of options granted to selected employees, officers, directors, consultants and advisers. The options may be either “incentive stock options” (as such term is defined in the Internal Revenue Code of 1986) or options that are not intended to qualify as “incentive stock options” (these are referred to as “non-qualified options”). Incentive stock options may be granted only to employees. The 2017 Plan is administered by the Board or, at the discretion of the Board, a Board committee. The administrator determines who will receive options and the terms of the options, including the exercise price, expiration date, vesting and the number of shares. The exercise price of each stock option may not be less than the fair market value of the Common Stock on the date of grant, although the exercise price of any incentive stock option granted to a 10% stockholder may not be less than 110% of the fair market value on the grant date. Options may be exercisable (“vest”) immediately or in increments based on time and/or performance criteria as determined by the administrator. The term of any option may not exceed 10 years (five years for any incentive stock option granted to a 10% stockholder), and unless otherwise determined by the administrator, each option must terminate no later than three months after the termination of the optionee’s employment (one year in the event of death or disability). Subject to a few minor exceptions, options may not be transferred other than by will or by the laws of descent and distribution. The 2017 Plan will expire on December 31, 2026.

	Year Ended
	August 31,
	2018	2017
Expected term	3.59 - 5.98 years	4.59 - 6.43 years
Expected average volatility	175% - 176%	179% - 183%
Expected dividend yield	-	-
Risk-free interest rate	2.20% - 2.35%	1.17% - 2.25%

15The ~~Table~~total fair values of ~~Contents~~stock options that vested during the period ended May 31, 2019 and year ended August 31, 2018 were $16,515,235 and $18,112,430, respectively.

OnAs ~~December~~of 30May 31, ~~2017~~2019, ~~the~~there ~~Company~~was ~~granted~~$3,581,148 ~~options~~of tototal ~~directors~~unrecognized ~~(see~~compensation ~~below) to~~cost ~~purchase~~related anto ~~aggregate~~non-vested ~~of 14 shares of our common~~ stock atoptions ~~a price of $59,400 per share vesting immediately on December 31, 2017~~granted. The ~~options~~Company ~~expire~~expects ~~December~~to ~~29,~~recognize ~~2022,~~that ~~unless~~cost ~~such~~over ~~director~~a ~~ceases~~remaining ~~his~~weighted oraverage ~~her~~vesting ~~service~~period asof a0.50 ~~director~~years ~~prior~~as ~~the exercise or expiration~~ of ~~the~~May ~~option~~31, 2019.

As14 Table of ~~February 28, 2019, there were 320 shares available for future grant under the 2017 Plan.~~Contents

~~Stock~~NOTE ~~Options~~7 – CONVERTIBLE NOTES

~~During~~The ~~the~~Company ~~six~~had ~~months ended February 28, 2019,~~ the ~~Company~~following ~~did~~principal ~~not~~balances ~~grant~~under ~~options~~its ~~and~~convertible ~~during~~notes ~~the~~outstanding ~~year~~as ~~ended~~of ~~August~~May 31, ~~2018,~~2019 ~~the~~and ~~Company~~August ~~granted options with an aggregate fair value of $19~~31,~~412,264,~~ ~~which are being amortized into compensation expense over the vesting period of the options as the services are being provided.~~2018:

The following is a summary of stock option activity during the six months ended February 28, 2019 and the year ended August 31, 2018:

	May 31,			August 31,
	2019			2018
Convertible Notes - originated in October 2017	$	162,700		$	164,190
Convertible Notes - originated in December 2017		109,725			109,725
Convertible Notes - originated in January 2018		1,915			24,500
Convertible Notes - originated in March 2018		145,833			145,833
Convertible Notes - originated in April 2018		1,190,000			1,250,000
Convertible Notes - originated in May 2018		145,833			145,833
		1,756,006			1,840,081
Less debt discount and debt issuance cost		-			(863,852	)
		1,756,006			976,229
Less current portion of convertible notes payable		(1,756,006	)		976,229
Long-term convertible notes payable	$	-		$	-

	Options Outstanding
	Number of Shares			Weighted- Average Exercise Price		Fair Value on Grant Date			Intrinsic Value
Balances as of August 31, 2017		946		$	98,700	$	35,864,990		$	-
Granted		339			66,000		19,412,264			-
Exercised		-			-		-			-
Forfeited		(2	)		37,200		(67,894	)		-
Balances as of August 31, 2018		1,283		$	58,500	$	55,209,360		$	-
Granted		-			-		-			-
Exercised		-			-		-			-
Forfeited		-			-		-			-
Balances as of February 28, 2019		1,283		$	58,504	$	55,209,360		$	-

The Company recognized amortization expense related to the debt discount and deferred financing fees of $863,852 and $4,573,723 for the nine months ended May 31, 2019 and 2018, respectively, which is included in interest expense in the statements of operations.

~~The~~For ~~following~~the ~~table~~nine ~~summarizes~~months ~~information~~ended ~~relating~~May to31, ~~exercisable~~2019 ~~stock~~and ~~options~~2018, asthe interest expense on convertible notes was $150,307 and $182,093, respectively. As of ~~February~~May 2831, 2019: and August 31, 2018, the accrued interest payable was $204,352 and $67,157, respectively.

Options Exercisable
Number of Shares		Weighted Average Exercise Price
	968	$	53,222

During the nine months ended May 31, 2019, the Company repaid $50,000 on one of its April 2018 convertible notes.

Aggregate intrinsic value is the sum of the amounts by which the quoted market price of the Company’s stock exceeded the exercise price of the stock options exercisable at February 28, 2019. As of February 28, 2019, the aggregate intrinsic value of stock options outstanding was $0 based on the closing market price of $0.0001 on February 28, 2019.Conversion

16During ~~Table~~the nine months ended May 31, 2019, holders of ~~Contents~~certain of the convertible notes converted these notes with principal amounts of $34,075 and accrued interest of $13,112 into 257,544,764 shares of common stock. The corresponding derivative liability at the date of conversion of $122,122 was credited to additional paid in capital.

~~Weighted-average~~Convertible ~~grant-date~~Notes ~~fair~~– ~~value~~Issued ~~for~~during ~~non-vested~~the ~~stock~~year ~~options~~ended ~~as of February 28, 2019 and~~ August 31, 2018 ~~were listed as follows:~~

	Shares			Weighted-Average Grant Date Fair Value Per Share
Unvested, August 31, 2017		809		$	38,100
Granted		339			57,300
Vested		(473	)		43,800
Forfeited		-			-
Unvested, August 31, 2018		675		$	43,800
Granted		-			-
Vested		(360	)		64,000
Forfeited		-			-
Unvested, February 28, 2019		315		$	74,700

During the year ended August 31, 2018, the Company issued a total principal amount of $6,618,099 convertible notes for cash proceeds of $5,662,750, after deducting an original issuance discount of $629,099 and financing fees of $326,250. The convertible notes were also provided with a total of 53 common shares and warrants to purchase up to 25 shares of common stock at exercise prices ranging from $52,500 to $60,000 per share. The terms of convertible notes are summarized as follows:

~~The~~· ~~fair~~Term ~~value~~ranging offrom ~~each~~six ~~option~~months onto one year; · Annual interest rates ranging from 0% to 12%; · Convertible at the ~~date~~option of ~~grant~~the isholders ~~estimated~~either ~~using~~at ~~the~~issuance ~~Black-Scholes~~or ~~option~~180 ~~valuation~~days ~~model.~~from ~~The~~issuance; ~~following~~and ~~weighted-average~~· ~~assumptions~~Conversion ~~were~~prices ~~used~~are ~~for~~typically ~~options~~based ~~granted~~on ~~during~~55% or 70% of the ~~year~~lowest ~~ended~~trading ~~August~~prices ~~31,~~of ~~2018~~the ~~and~~Company’s ~~2017:~~shares during 20-25 days prior to the conversion.

	Year Ended
	August 31,
	2018			2017
Remaining contractual term	3.59 - 5.98 years			4.59 - 6.43 years
Expected average volatility	175% - 176		%	179% - 183		%
Expected dividend yield		-			-
Risk-free interest rate	2.20% - 2.35		%	1.17% - 2.25		%

NOTE 8 – DERIVATIVE LIABILITIES

The ~~total~~Company ~~fair~~analyzed ~~values~~the ofconversion ~~stock~~option ~~options~~for derivative accounting consideration under ASC 815, “Derivatives and Hedging,” and determined that ~~vested~~the ~~during~~convertible notes should be classified as a liability since the ~~period~~conversion ~~ended~~option ~~February~~becomes ~~28,~~effective ~~2019~~at ~~and~~issuance ~~year~~resulting ~~ended~~in ~~August~~there ~~31,~~being ~~2018~~no ~~were~~explicit ~~$16,515,235~~limit to the number of shares to be delivered upon settlement of the above conversion options. The Company accounts for warrants and ~~$18,112,430,~~Series ~~respectively~~A Convertible Preferred Stock as a derivative liability due to there being no explicit limit to the number of shares to be delivered upon settlement of all conversion options.

AsThe 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 ~~February~~May 2831, 2019. The Black-Scholes model requires six basic data inputs: the exercise or strike price, ~~there~~time ~~was~~to $5expiration,~~204~~ the risk-free interest rate,~~235~~ ofthe ~~total~~current ~~unrecognized~~stock ~~compensation~~price, ~~cost~~the ~~related~~estimated tovolatility ~~non-vested~~of the stock ~~options~~price ~~granted.~~in ~~The~~the ~~Company~~future, ~~expects~~and the dividend rate. Changes to ~~recognize~~these ~~that~~inputs ~~cost~~could ~~over~~produce a ~~remaining~~significantly ~~weighted~~higher ~~average~~or ~~vesting~~lower ~~period~~fair ofvalue 0measurement.75 ~~years~~The asfair value of ~~February~~each 28convertible note and warrant is estimated using the Black-Scholes valuation model. The following weighted-average assumptions were used in May 31, 2019. and August 31, 2018:

NOTE 7 – CONVERTIBLE NOTES

	Nine Months Ended	Year Ended
	May 31, 2019	August 31,
	2019	2018
Expected term	0.08 - 0.35 years	0.10 - 5.00 years
Expected average volatility	0% - 582%	49% - 350%
Expected dividend yield	-	-
Risk-free interest rate	2.31%-2.52%	0.98% - 2.83%

~~The~~15 ~~Company~~Table ~~had the following principal balances under its convertible notes outstanding as~~ of ~~February 28, 2019 and August 31, 2018:~~Contents

	February 28,			August 31,
	2019			2018
Convertible Notes - originated in October 2017	$	162,700		$	164,190
Convertible Notes - originated in December 2017		109,725			109,725
Convertible Notes - originated in January 2018		1,915			24,500
Convertible Notes - originated in March 2018		145,833			145,833
Convertible Notes - originated in April 2018		1,190,000			1,250,000
Convertible Notes - originated in May 2018		145,833			145,833
		1,756,006			1,840,081
Less debt discount and debt issuance cost		(48,346	)		(863,852	)
		1,707,660			976,229
Less current portion of convertible notes payable		(1,707,660	)		976,229
Long-term convertible notes payable	$	-		$	-

The following table summarizes the derivative liabilities included in the balance sheet at May 31, 2019:

The Company recognized amortization expense related to the debt discount and deferred financing fees of $815,506 and $1,469,387 for the six months ended February 28, 2019 and 2018, respectively, which is included in interest expense in the statements of operations.

Fair Value Measurements Using Significant Observable Inputs (Level 3)
Balance - August 31, 2018	$	4,494,698
Addition of new derivative liabilities recognized upon issuance of convertible preferred stock		1,259,944
Derivative liabilities settled upon conversion of convertible notes		(122,122	)
Derivative liabilities settled upon conversion of convertible preferred stock		(1,189,068	)
Gain on change in fair value of the derivative liabilities		(405,720	)
Balance - May 31, 2019	$	4,037,732

17The ~~Table~~following oftable ~~Contents~~summarizes the loss on derivative liability included in the income statement for the nine months ended May 31, 2019 and 2018, respectively.

For the six months ended February 28, 2019 and 2018, the interest expense on convertible notes was $95,168 and $92,521, respectively. As of February 28, 2019 and August 31, 2018, the accrued interest payable was $149,213 and $67,157, respectively.

	Nine months ended
	May 31, 2019
	2019			2018
Addition of new derivative liabilities recognized as day one loss on derivatives from convertible notes	$	-		$	3,225,787
Addition of new derivative liabilities recognized upon issuance of convertible preferred stock		1,259,944			7,806,061
Addition of new derivative liabilities recognized as day one loss on derivatives from warrants		-			859,488
Loss (Gain) on change in fair value of the derivative liabilities		(405,720	)		(16,925,497	)
	$	854,224		$	(5,034,161	)

~~During~~NOTE ~~the~~9 ~~six~~– ~~months~~COMMITMENTS ~~ended~~AND ~~February 28, 2019, the Company repaid $50,000 on one of its April 2018 convertible notes.~~CONTINGENCIES

~~Conversion~~Anti-Dilution Agreements

~~During~~Pursuant to our agreement with Jet Midwest Group, LLC entered into in October 2016, in consideration of the ~~six~~services ~~months~~to ~~ended~~be ~~February~~provided 28by Jet Midwest Group, ~~2019~~LLC, ~~holders~~we issued to Jet Midwest Group, LLC 1,250,000 shares of ~~certain~~common stock representing 1.6% of ~~the~~our ~~convertible~~common ~~notes~~stock ~~converted~~outstanding ~~these~~at ~~notes~~that date. The agreement with ~~principal~~Jet ~~amounts~~Midwest Group, LLC provides full ratchet anti-dilution protection to Jet Midwest Group, LLC. As a result, each time we issue additional shares of ~~$34~~common stock or shares of another class or series of capital stock,~~075~~ we will issue to Jet Midwest Group, LLC without further consideration additional shares of our common stock or other class or series of capital stock so that Jet Midwest Group, LLC will continue to own 1.6% of the outstanding shares of common stock and ~~accrued~~each ~~interest~~other class or series of ~~$13~~capital stock. Through May 31,~~112~~ ~~into~~2019, ~~257~~we had issued 49 shares of common stock to Jet Midwest Group,~~544~~ LLC and were obligated to issue an additional 71,~~764~~295,802 shares of common stock. ~~The~~After ~~corresponding~~entering ~~derivative~~into ~~liability~~the atagreement with us, Jet Midwest Group, LLC sought protection from creditors under the ~~date~~bankruptcy code, which proceedings were subsequently dismissed. One of ~~conversion~~Jet Midwest Group, LLC’s creditors has claimed that shares of ~~$122~~our common stock to be issued under the anti-dilution right should be issued to it instead of Jet Midwest Group,~~122~~ ~~was~~LLC. ~~credited~~In light of this dispute and ongoing litigation between Jet Midwest Group, LLC and its creditors, the Company is evaluating its obligation to ~~additional~~continue ~~paid~~issuing inshares ~~capital~~to Jet Midwest Group, LLC.

~~Convertible~~Consulting ~~Notes – Issued during the year ended August 31, 2018~~agreement

~~During~~On ~~the~~July ~~year ended August~~ 31, ~~2018~~2017, the Company ~~issued~~engaged Brighton Capital, Ltd. (“Brighton”) for a ~~total~~three ~~principal~~(3) ~~amount~~year term to render strategic advisory services. Pursuant to our agreement with Brighton, in consideration of $6the services to be provided by Brighton,~~618,099~~ ~~convertible~~we ~~notes~~are ~~for~~to ~~cash~~issue ~~proceeds~~14 shares of ~~$5,662,750,~~common ~~after~~stock ~~deducting~~and an34 ~~original~~warrants ~~issuance~~over ~~discount~~a three-year term. We issued 2 shares of ~~$629~~common stock and 4 warrants upon execution of this agreement,~~099~~ and ~~financing~~are ~~fees~~to issue 1 shares of ~~$326~~common stock and 1 warrant per month for thirty-six (36) months,~~250~~ with the first issuance beginning August 1, 2017. ~~The~~Through ~~convertible~~May ~~notes~~31, ~~were~~2019, ~~also~~we ~~provided~~had ~~with~~issued a24 ~~total~~shares of 53 common ~~shares~~stock and 26 warrants to purchase upcommon stock to 25Brighton. ~~shares~~The ofwarrants, ~~common~~as ~~stock~~issued, atshall ~~exercise~~immediately ~~prices~~vest ~~ranging~~and ~~from~~have ~~$52,500~~a toterm of five (5) years with an exercise price of $6057,000 per share. The ~~terms~~warrants ofhave ~~convertible~~a ~~notes~~cashless ~~are~~exercise ~~summarized~~feature asthat ~~follows:~~can be utilized if the shares underlying the warrants cannot be resold under an effective registration statement filed with the Securities and Exchange Commission by March 1, 2018.

·16 ~~Term~~Table ~~ranging from six months to one year; · Annual interest rates ranging from 0% to 12%; · Convertible at the option~~ of the holders either at issuance or 180 days from issuance; and · Conversion prices are typically based on 55% or 70% of the lowest trading prices of the Company’s shares during 20-25 days prior to the conversion.Contents

~~NOTE 8 – DERIVATIVE LIABILITIES~~Other

~~The~~On ~~Company~~August ~~analyzed~~3, ~~the~~2016, ~~conversion~~we ~~option~~acquired ~~for~~from ~~derivative~~Apcentive, ~~accounting~~Inc. ~~consideration~~(“Apcentive”) ~~under~~all ~~ASC~~of ~~815~~Apcentive’s right, ~~“Derivatives~~title and ~~Hedging~~interest in and to U.S. Patent No. 6,” 285,878 B1 and ~~determined~~all ~~that~~related ~~the~~supporting ~~convertible~~materials, ~~notes~~continuations, ~~should~~amendments, beupdates ~~classified~~and ascontemplated aupdates ~~liability~~and ~~since~~amendments and the ~~conversion~~trademark ~~option~~“Infinitus ~~becomes~~Super ~~effective~~HighwaySM.” atIn ~~issuance~~consideration ~~resulting~~for inthe ~~there~~patent ~~being~~and nothe ~~explicit~~trademark, ~~limit~~we toissued ~~the~~a number of shares of our common stock to beApcentive ~~delivered~~and ~~upon~~agreed ~~settlement~~to pay Apcentive a future royalty equal to 1.5% of the ~~above~~net ~~conversion~~cash ~~options.~~we ~~The~~receive ~~Company~~from ~~accounts~~the ~~for~~promotion, ~~warrants~~marketing, sale, licensing, distribution and ~~Series~~other Aexploitation ~~Convertible~~of ~~Preferred~~the ~~Stock~~patent. asWe aare ~~derivative~~further ~~liability~~required ~~due~~to issue an additional 667 shares of common stock to ~~there~~Apcentive ~~being~~if nowe ~~explicit~~do ~~limit~~not spend, on matters relating to the ~~number~~patent and trademark, a cumulative total of ~~shares~~$8 tomillion beon ~~delivered~~or ~~upon~~before ~~settlement~~August 3, 2019. The purchase agreement requires that we spend at least $1 million on or before August 3, 2017 (which goal has been met), a total of ~~all~~at ~~conversion~~least ~~options~~$2 million on or before August 3, 2018 (which goal has been met) and a total of at least $5 million on or before August 3, 2019. As of May 31, 2019, the Company has not made a contingency for these events, but has expensed these costs, as incurred, which have exceeded the commitment.

~~The~~On ~~Company~~February ~~determined~~6, ~~our~~2019, ~~derivative~~the ~~liabilities~~Company towas benamed as a ~~Level~~defendant 3in ~~fair~~YA ~~value~~II ~~measurement~~PN, ~~and~~LTD. ~~used~~v. ~~the~~Airborne ~~Black-Scholes~~Wireless ~~pricing~~Network, ~~model~~in toa ~~calculate~~complaint ~~the~~filed ~~fair~~in ~~value~~the asSuperior Court of ~~February~~New 28Jersey, ~~2019.~~Hudson ~~The~~County, ~~Black~~Docket No.: HUD-~~Scholes~~L-00-557-19. On ~~model~~March ~~requires~~21, ~~six~~2019, ~~basic~~the ~~data~~Plaintiff ~~inputs:~~filed ~~the~~a ~~exercise~~request orfor ~~strike~~Entry ~~price,~~of ~~time~~Default toJudgment ~~expiration,~~in the ~~risk-free~~amount ~~interest~~of ~~rate~~$1,284,542. ~~the~~On ~~current~~March ~~stock~~26, ~~price~~2019, ~~the~~YA ~~estimated~~II ~~volatility~~PN ofobtained ~~the~~a ~~stock~~Final ~~price~~Judgment inagainst the ~~future,~~Company ~~and~~in the ~~dividend~~amount ~~rate.~~of ~~Changes~~$1,284,542, towhich ~~these~~is ~~inputs~~included ~~could~~in ~~produce~~the aoutstanding ~~significantly~~principal ~~higher~~balance orof ~~lower~~the ~~fair~~convertible ~~value~~note ~~measurement. The fair value~~ of ~~each~~$1,190,000 ~~convertible~~and accrued note ~~and~~interest ~~warrant~~of is$111,364 ~~estimated~~as ~~using~~of ~~the~~May ~~Black-Scholes~~31, ~~valuation model~~2019. The ~~following~~Company ~~weighted-average~~is ~~assumptions~~currently ~~were~~evaluating ~~used~~its inoptions ~~February~~and ~~28,~~alternative ~~2019~~ways ~~and~~to ~~August~~satisfy ~~31, 2018:~~it.

	Six months ended			Year Ended
	February 28,			August 31,
	2019			2018
Expected term	0.08 - 0.35 years			0.10 - 5.00 years
Expected average volatility	0% - 582		%	49% - 350		%
Expected dividend yield		-			-
Risk-free interest rate	2.31%-2.52		%	0.98% - 2.83		%

From time to time, the Company is involved in routine litigation that arises in the ordinary course of business. Management believes that the ultimate outcomes of the pending significant legal proceedings to which the Company is a party may have a material adverse effect on the Company’s financial position.

18Lease ~~Table of Contents~~Commitment

In June 2016, we signed a lease agreement that commenced on July 1, 2016 for our corporate office headquarters with approximately 1,500 square feet, at 4115 Guardian Street, Simi Valley, California 93063. The ~~following~~lease ~~table~~expired ~~summarizes~~on ~~the~~August ~~derivative~~31, ~~liabilities~~2017 ~~included~~and our monthly rent was $1,750 (plus HVAC charges), payable in equal monthly installments. In August 2017, the ~~balance~~lease ~~sheet~~was extended by two years commencing September 1, 2017 at ~~February~~$1,803 28per month (plus HVAC charges) for the first year and $1,857 ~~2019:~~per month (plus HVAC charges) for the second year.

Fair Value Measurements Using Significant Observable Inputs (Level 3)
Balance - August 31, 2018	$	4,494,698
Addition of new derivative liabilities recognized upon issuance of convertible preferred stock		1,232,065
Derivative liabilities settled upon conversion of convertible notes		(122,122	)
Derivative liabilities settled upon conversion of convertible preferred stock		(1,107,827	)
Gain on change in fair value of the derivative liabilities		(406,112	)
Balance - February 28, 2019	$	4,090,702

On February 1, 2018, the Company signed an operating lease for a residence to be used by our Chief Executive Officer, located in Moorpark, California. The lease term commenced on February 1, 2018 and expired on January 31, 2019. Our monthly rent is $4,510, payable in equal monthly installments. On February 1, 2018, the Company prepaid the $54,120, for the full term of the lease. As at May 31, 2019, we have fully expensed this amount.

~~The~~Total ~~following~~net ~~table~~rent ~~summarizes~~expense ~~the~~related ~~loss~~to onour ~~derivative~~operating ~~liability~~leases ~~included in the income statement~~ for the nine ~~six~~ months ended ~~February~~May 2831, 2019 and 2018, was $14,926 and $25,010, respectively.

	Six months ended
	February 28,
	2019			2018
Addition of new derivative liabilities recognized as day one loss on derivatives from convertible notes	$	-		$	282,093
Addition of new derivative liabilities recognized upon issuance of convertible preferred stock		1,232,065			-
Addition of new derivative liabilities recognized as day one loss on derivatives from warrants		-			859,488
Loss (Gain) on change in fair value of the derivative liabilities		(406,112	)		1,400,375
	$	825,953		$	2,541,956

Future minimum payments under the non-cancelable portion of our operating leases as of August 31, 2018 are as follows:

NOTE 9 – COMMITMENTS AND CONTINGENCIES

Year ending August 31,
2019	$	5,571
Thereafter		-
Total	$	5,571

~~Anti-Dilution~~NOTE ~~Agreements~~10 – RELATED PARTY TRANSACTIONS

~~Pursuant~~During tothe ~~our~~nine ~~agreement~~months ~~with~~ended ~~Jet~~May ~~Midwest Group~~31, ~~LLC entered into in October 2016~~2019, ~~in consideration of~~ the ~~services~~Company toborrowed ~~be provided by Jet Midwest Group~~$154,395 ~~LLC,~~from wea ~~issued~~shareholder tofor ~~Jet~~payments ~~Midwest Group, LLC 1,250,000 shares~~ of ~~common~~operating ~~stock representing 1~~expenses.6% ~~of our common stock outstanding at that date.~~ The ~~agreement~~loan with Jet Midwest Group, LLC provides full ratchet anti-dilution protection to Jet Midwest Group, LLC. As a result, each time we issue additional shares of common stock or shares of another class or series of capital stock, we will issue to Jet Midwest Group, LLC without further consideration additional shares of our common stock or other class or series of capital stock so that Jet Midwest Group, LLC will continue to own 1.6% of the outstanding shares of common stock and each other class or series of capital stock. Through February 28, 2019, we had issued 49 shares of common stock to Jet Midwest Group, LLC and were obligated to issue an additional 58,297,317 shares of common stock. After entering into the agreement with us, Jet Midwest Group, LLC sought protection from ~~creditors~~shareholder ~~under the bankruptcy code, which proceedings were subsequently dismissed. One~~ of ~~Jet Midwest Group~~$154,395 ~~LLC’s~~was ~~creditors~~forgiven ~~has claimed that shares of our common stock to be issued under the anti-dilution right should be issued to it instead of Jet Midwest Group, LLC. In light of this dispute~~ and ~~ongoing litigation between Jet Midwest Group, LLC and its creditors,~~ the Company isrecorded ~~evaluating~~it ~~its~~as ~~obligation~~additional topaid ~~continue~~in ~~issuing shares to Jet Midwest Group, LLC~~capital.

~~Consulting~~NOTE ~~agreement~~11 – SUBSEQUENT EVENTS

OnSubsequent ~~July 31, 2017, the Company engaged Brighton Capital, Ltd. (“Brighton”) for a three (3) year term~~ to ~~render~~May ~~strategic advisory services. Pursuant to our agreement with Brighton~~31, in2019 ~~consideration~~and ofthrough the ~~services~~date tothat bethese ~~provided~~financials bywere ~~Brighton, we are to issue 14 shares of common stock and 34 warrants over a three-year term. We~~ issued ~~2 shares of common stock and 4 warrants upon execution of this agreement~~, ~~and are to issue 1 shares of common stock and 1 warrant per month for thirty-six (36) months, with~~ the ~~first~~Company ~~issuance beginning August 1, 2017. Through February 28, 2019, we~~ had issued 21 shares of common stock and 23 warrants to purchase common stock to Brighton. The warrants, as issued, shall immediately vest and have a term of five (5) years with an exercise price of $57,000 per share. The warrants have a cashless exercise feature that can be utilized if the ~~shares~~following ~~underlying~~subsequent ~~the warrants cannot be resold under an effective registration statement filed with the Securities and Exchange Commission by March 1, 2018.~~events:

19The ~~Table~~Company issued 143,750,000 shares of ~~Contents~~common stock for the conversion of 10 shares of preferred stock.

~~Other~~Convertible note principal amount of $11,500 was converted into 191,666,666 shares of common stock.

On17 ~~August~~Table ~~3, 2016, we acquired from Apcentive, Inc. (“Apcentive”) all~~ of Apcentive’s right, title and interest in and to U.S. Patent No. 6,285,878 B1 and all related supporting materials, continuations, amendments, updates and contemplated updates and amendments and the trademark “Infinitus Super HighwaySM.” In consideration for the patent and the trademark, we issued a number of shares of our common stock to Apcentive and agreed to pay Apcentive a future royalty equal to 1.5% of the net cash we receive from the promotion, marketing, sale, licensing, distribution and other exploitation of the patent. We are further required to issue an additional 667 shares of common stock to Apcentive if we do not spend, on matters relating to the patent and trademark, a cumulative total of $8 million on or before August 3, 2019. The purchase agreement requires that we spend at least $1 million on or before August 3, 2017 (which goal has been met), a total of at least $2 million on or before August 3, 2018 (which goal has been met) and a total of at least $5 million on or before August 3, 2019. As of February 28, 2019, the Company has not made a contingency for these events, but has expensed these costs, as incurred, which have exceeded the commitment.Contents

~~From~~Item ~~time to time, the Company is involved in routine litigation that arises in the ordinary course of business~~2. Management’s ~~believes~~Discussion ~~that~~and ~~the~~Analysis ~~ultimate outcomes~~ of ~~the~~Financial ~~pending~~Condition ~~significant~~and ~~legal~~Results ~~proceedings~~of ~~to which the Company is a party may have a material adverse effect on the Company's financial position.~~Operations

~~Lease~~Cautionary ~~Commitment~~Note Regarding Forward-Looking Statements

InThis ~~June~~quarterly ~~2016,~~report weon ~~signed~~Form a10-Q ~~lease~~contains ~~agreement~~forward-looking ~~that~~statements. ~~commenced~~All onstatements ~~July~~other 1than statements of historical or current facts contained in this quarterly report, ~~2016~~including ~~for~~statements regarding our ~~corporate~~future ~~office~~results ~~headquarters~~of ~~with~~operations ~~approximately~~and 1financial position,~~500~~ ~~square~~business ~~feet~~strategy, atproposed ~~4115~~new ~~Guardian~~products ~~Street~~and services, ~~Simi~~research ~~Valley~~and development costs, ~~California~~granting ~~93063.~~of ~~The~~regulatory ~~lease~~approvals, ~~expired~~timing onand ~~August~~likelihood 31of success, ~~2017~~plans and ~~our~~objectives ~~monthly~~of ~~rent~~management ~~was~~for ~~$1,750~~future ~~(plus~~operations ~~HVAC~~and ~~charges),~~future ~~payable~~results inof ~~equal~~anticipated ~~monthly~~products ~~installments~~and services, are forward-looking statements. InThese ~~August~~statements ~~2017,~~involve ~~the~~known ~~lease~~and ~~was~~unknown ~~extended~~risks, byuncertainties ~~two~~and ~~years~~other ~~commencing~~important ~~September~~factors 1,that ~~2017~~may atcause $1our actual results,~~803~~ ~~per~~performance ~~month~~or ~~(plus~~achievements ~~HVAC~~to ~~charges)~~be ~~for~~materially ~~the~~different ~~first~~from ~~year~~any ~~and~~future $1results,~~857~~ ~~per~~performance ~~month~~or ~~(plus~~achievements ~~HVAC~~expressed ~~charges)~~or ~~for~~implied by the ~~second~~forward-looking ~~year~~statements.

OnIn ~~February~~some 1cases, ~~2018,~~forward-looking ~~the~~statements ~~Company~~can ~~signed~~be anidentified ~~operating~~by ~~lease~~terms ~~for~~such aas ~~residence~~“may,” to“will,” be“should,” ~~used~~“expect,” by“plan,” ~~our~~“anticipate,” ~~Chief~~“could,” ~~Executive~~“would,” ~~Officer~~“intend,” ~~located~~“target,” in“project,” ~~Moorpark~~“contemplate,” ~~California~~“believe,” “estimate,” “predict,” “potential” or “continue” or the negative of these terms or other similar expressions. The ~~lease~~forward-looking ~~term~~statements ~~commenced~~in this quarterly report are only predictions. We have based these forward-looking statements largely on ~~February~~our 1,current ~~2018~~expectations and ~~expired~~projections onabout ~~January~~future ~~31,~~events ~~2019.~~and ~~Our~~financial ~~monthly~~trends ~~rent~~that iswe $4believe may affect our business,~~510,~~ ~~payable~~financial incondition ~~equal~~and ~~monthly~~results ~~installments~~of operations. OnThese ~~February~~forward-looking 1,statements ~~2018,~~speak ~~the~~only ~~Company~~as ~~prepaid~~of the ~~$54~~date of this quarterly report and are subject to a number of risks,~~120~~ and except as required by applicable law, ~~for~~we ~~the~~do ~~full~~not ~~term~~plan ofto ~~the~~publicly ~~lease.~~update Asor atrevise ~~February~~any 28forward-looking statements contained herein, ~~2019~~whether as a result of any new information, wefuture ~~have~~events, ~~fully~~changed ~~expensed~~circumstances ~~this~~or ~~amount~~otherwise.

~~Total~~Because ~~net~~forward-looking ~~rent~~statements ~~expense~~are ~~related~~inherently subject to ~~our~~risks ~~operating~~and ~~leases~~uncertainties, ~~for~~some ~~the six~~of ~~months~~which ~~ended~~cannot ~~February~~be 28predicted or quantified and some of which are beyond our control, ~~2019~~prospective investors should not rely on these forward-looking statements as predictions of future events. The events and ~~2018~~circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in, ~~was~~or ~~$10~~implied by,~~426~~ ~~and~~the ~~$25~~forward-looking statements due to a variety of factors,~~010~~ ~~respectively.~~including, but not limited to:

~~Future~~· ~~minimum~~our ~~payments~~financial ~~under~~performance, including our history of operating losses; · our ability to obtain additional funding to continue our operations; · our ability to successfully develop, implement and commercialize the ~~non-cancelable~~Infinitus ~~portion~~Super Highway (“Infinitus”); · our ability to enter into agreements with airlines that permit us to install our equipment on their aircraft; · our ability to enter into agreements with potential customers and purchasers; · changes in the regulatory environments of the United States and other countries in which we intend to operate; · our ~~operating~~ability ~~leases~~to asattract and retain key management and other personnel; · competition from new market entrants and new technologies; · our ability to identify and pursue development of appropriate products; and · risks, uncertainties and assumptions described under Section 1A. “Risk Factors” in our company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2018, ~~are~~and asin ~~follows:~~any subsequent filings we make with the Securities and Exchange Commission (the “SEC”) and under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this quarterly report.

Year ending August 31,
2019	$	11,142
Thereafter		-
Total	$	11,142

Table of Contents

~~NOTE~~Forward-looking 10statements –are ~~SUBSEQUENT~~expressly ~~EVENTS~~qualified in their entirety by this cautionary statement. The forward-looking statements included in this document are made as of the date of this document and we do not undertake any obligation to update forward-looking statements to reflect new information, subsequent events or otherwise, except as required by law. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. We qualify all of our forward-looking statements by these cautionary statements.

~~Subsequent~~As toused ~~February~~in ~~28,~~this ~~2019~~quarterly ~~and~~report, ~~through~~ the ~~date~~terms ~~that~~the ~~these~~“Company,” ~~financials~~“we,” ~~were~~“us” and ~~made~~“our” ~~available,~~refer ~~the~~to ~~Company~~Airborne ~~had~~Wireless ~~the~~Network, ~~following~~a ~~subsequent~~Nevada ~~events:~~corporation.

The Company ~~issued 449,981,061 shares of common stock for the conversion of 32 shares of preferred stock.~~

AnAirborne ~~investor exercised~~Wireless 20Network ~~units~~was offormed ~~Series~~as 3a ~~warrants~~Nevada ~~originally~~corporation ~~granted~~on inJanuary ~~conjunction~~5, ~~with~~2011 under the ~~Series~~name A“Ample-Tee” ~~Convertible~~to ~~Preferred~~engage ~~Stock~~in ~~into~~the 20business ~~shares~~ of ~~Series~~promoting, Amarketing, ~~Convertible~~selling ~~Preferred~~and ~~Stock~~distributing ~~for~~hard-to-find ~~net~~ergonomic ~~proceeds~~products offor ~~$20,000~~the physically disabled.

On ~~November~~October 1520, ~~2018~~2015, ~~the~~our ~~Company~~current ~~was~~President, ~~named~~Treasurer asand ~~a defendant in Neutron Media~~Secretary, ~~Inc~~J. v.Edwards ~~Airborne~~Daniels, ~~Wireless~~acquired ~~Network,~~control inof athe ~~complaint~~Company ~~filed~~by inpurchasing ~~the~~from ~~Superior~~Lawrence ~~Court~~Chenard, ofour ~~Ventura~~former ~~County~~president, ~~California~~2,803 ~~Case~~shares ~~No.:~~of ~~56-2018-00520023-CU-CL-VTA. On~~our ~~March~~common 8,stock ~~2019,~~for a ~~Request~~purchase ~~for~~price ~~Dismissal~~of ~~was~~$250,000 ~~filed~~(2,667 byof ~~the~~which ~~plaintiff~~shares ~~with~~were ~~the~~delivered ~~Ventura~~by ~~Superior~~Mr. ~~Court~~Daniels ~~and~~to the ~~complaint~~Company ~~was~~for ~~dismissed~~cancellation without ~~prejudice~~consideration in ~~the~~August ~~Neutron matter~~2016).

On ~~February~~May 619, ~~2019~~2016, ~~the~~we ~~Company~~changed ~~was~~our ~~named~~name asto ~~a defendant in YA II PN, LTD. v.~~ “Airborne Wireless Network,” into abetter ~~complaint~~align ~~filed~~our inname ~~the~~with ~~Superior~~our ~~Court~~intention ofto ~~New~~develop Jersey, Hudson County, Docket No.: HUD-L-00-557-19. On March 21, 2019, the Plaintiff filed a request for Entry of Default Judgment in the amount of $1,284,542. On March 26, 2019, YA II PN obtained a Final Judgement against the Company in the amount of $1,284,542. The Company is currently evaluating the judgment and ~~its~~deliver ~~options~~next ~~and~~generation ~~alternative~~global ~~ways to satisfy it~~connectivity.

On August 3, 2016, we acquired from Apcentive, Inc. (“Apcentive”) all of Apcentive’s right, title and interest in and to U.S. Patent No. 6,285,878 B1, which expired on September 20, ~~Table~~2018 and all related support materials, continuations, amendments, updates and contemplated updates and amendments and the trademark “Infinitus Super Highway.” In exchange for that patent and trademark, we issued to Apcentive a number of ~~Contents~~shares of our common stock and agreed to pay Apcentive a future royalty equal to 1.5% of the net cash we receive from the promotion, marketing, sale, licensing, distribution and other exploitation of that patent.

~~Item~~On 2August 24, 2018, we effected a 30,000-to-1 reverse split of our common stock. ~~Management'~~As a result of the reverse split, every 30,000 pre-split shares of the Company’s ~~Discussion~~common stock outstanding on the effective date of the reverse split were automatically combined into one new share of common stock without any action on the part of the holders, and ~~Analysis~~the number of ~~Financial~~outstanding ~~Condition~~shares orof ~~Plan~~common stock was reduced from approximately 8,888,443 to approximately 296,000 (subject to the rounding up of ~~Operation~~fractional shares). All historical share balances and share price-related data in this annual report have been adjusted based on the 30,000-to-1 reverse split ratio.

~~Cautionary~~We ~~Note~~are ~~Regarding~~an ~~Forward~~early-~~Looking~~stage ~~Statements~~company with the principal business strategy of developing, marketing and licensing a fully meshed, high-speed broadband airborne wireless network by linking aircraft in flight. We call this network the “Infinitus Super Highway.” To our knowledge, no fully meshed commercial broadband airborne network exists in the world today.

~~This~~We ~~quarterly~~expect ~~report~~that, onif ~~Form~~and ~~10-Q~~when ~~contains~~developed, Infinitus ~~forward-looking~~will ~~statements.~~provide ~~All~~a ~~statements~~broadband ~~other~~wireless ~~than~~communication ~~statements~~infrastructure ofby ~~historical~~using orand ~~current~~customizing ~~facts~~existing, ~~contained~~small, inlightweight, ~~this~~low-power ~~quarterly~~relay ~~report,~~station ~~including~~equipment ~~statements~~and ~~regarding~~antennae ~~our~~that ~~future~~will ~~results~~be ofinstalled ~~operations~~onboard ~~and~~aircraft. ~~financial~~Each ~~position,~~equipped ~~business~~aircraft ~~strategy,~~would ~~proposed~~have ~~new~~a ~~products~~broadband ~~and~~wireless ~~services,~~communication ~~research~~link ~~and~~to ~~development~~one ~~costs,~~or ~~granting~~more ofneighboring ~~regulatory~~aircraft ~~approvals,~~and/or ~~timing~~ground ~~and~~stations. ~~likelihood~~These ofaircraft ~~success,~~would ~~plans~~form ~~and~~a ~~objectives~~chain of ~~management~~seamless ~~for~~airborne ~~future~~repeaters ~~operations~~or ~~and~~routers ~~future~~providing ~~results~~broadband ofwireless ~~anticipated~~communication ~~products~~gateways ~~and~~along ~~services~~the entire flight path, ~~are~~essentially ~~forward-looking~~creating ~~statements.~~a ~~These~~digital ~~statements~~superhighway ~~involve~~in ~~known~~the ~~and~~sky. ~~unknown~~If ~~risks,~~a ~~uncertainties~~link ~~and~~was ~~other~~interrupted, ~~important~~the ~~factors~~signal ~~that~~would ~~may~~be ~~cause~~redirected ~~our~~to ~~actual~~the ~~results,~~next ~~performance~~participating aircraft or ~~achievements~~ground tostation bein ~~materially~~the ~~different~~chain ~~from~~-- ~~any~~in ~~future~~other ~~results~~words, ~~performance~~there orwould ~~achievements~~be ~~expressed~~multiple, orsimultaneous ~~implied~~data byconnections and thus the ~~forward-looking~~system ~~statements~~would not rely on a single link.

InWe ~~some~~intend ~~cases,~~to ~~forward-looking~~act ~~statements can be identified by terms such~~ as ~~“may,”~~a ~~“will,”~~wholesale ~~“should~~carrier,” ~~“expect,”~~licensing ~~“plan,”~~our ~~“anticipate,”~~bandwidth ~~“could~~to,” ~~“would,”~~among ~~“intend~~others,” ~~“target,”~~data ~~“project,”~~service ~~“contemplate,”~~providers ~~“believe,”~~(such ~~“estimate,”~~as ~~“predict,”~~major ~~“potential”~~telecommunications orcompanies ~~“continue”~~and ~~or the negative of these terms or~~ other ~~similar~~Internet ~~expressions.~~service ~~The~~providers) ~~forward-looking~~that ~~statements~~provide inbroadband ~~this~~services ~~quarterly~~to ~~report~~end ~~are~~users, ~~only~~to ~~predictions.~~government Weagencies ~~have based these forward-looking statements largely on our current expectations~~ and ~~projections~~to ~~about~~companies ~~future events and financial trends~~ that wedesire ~~believe~~a ~~may~~more ~~affect~~robust ~~our~~private ~~business,~~broadband ~~financial condition and results of operations~~network. ~~These~~We ~~forward-looking~~do ~~statements~~not ~~speak~~plan ~~only~~to aslicense ofor ~~the~~sell ~~date~~Infinitus ofdirectly ~~this quarterly report and are subject~~ to aconsumers. ~~number~~We ofanticipate ~~risks,~~that ~~and~~Infinitus ~~except~~will asenable ~~required~~our byfuture ~~applicable~~customers ~~law, we do not plan~~ to ~~publicly~~minimize ~~update~~their orinfrastructure ~~revise~~development ~~any~~time ~~forward-looking~~and ~~statements contained herein~~costs, ~~whether~~and asincrease athe ~~result~~reliability of ~~any~~their ~~new~~broadband ~~information,~~communications ~~future events, changed circumstances or otherwise~~systems.

~~Because~~19 ~~forward-looking~~Table ~~statements are inherently subject to risks and uncertainties, some~~ of which cannot be predicted or quantified and some of which are beyond our control, prospective investors should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in, or implied by, the forward-looking statements due to a variety of factors, including, but not limited to:Contents

·If ~~our~~we ~~financial~~can ~~performance,~~successfully ~~including~~complete ~~our~~the ~~history~~development of ~~operating~~Infinitus, ~~losses;~~which ·requires ~~our ability to obtain~~ additional ~~funding~~financing, Infinitus tocould ~~continue~~provide ~~our~~high-speed ~~operations;~~broadband ·Internet ~~our~~service ~~ability~~ to ~~successfully~~(i) ~~develop,~~supplement ~~implement~~or ~~and~~replace ~~commercialize~~current ~~the~~broadband ~~Infinitus~~networks, ~~Super Highway~~ (~~“Infinitus”~~ii); ·serve ~~our~~currently ~~ability~~underserved tomarkets, ~~enter~~such ~~into~~as ~~agreements~~maritime, ~~with~~rural ~~airlines~~and ~~that~~remote ~~permit~~locations, us(iii) togovernment ~~install~~agencies, ~~our~~including ~~equipment~~those onthat ~~their~~provide ~~aircraft;~~emergency ·or ~~our~~disaster ~~ability~~relief toservices, ~~enter~~(iv) ~~into~~companies ~~agreements~~seeking ~~with~~a ~~potential~~more ~~customers~~secure, ~~and~~reliable ~~purchasers;~~private ·data ~~changes~~network, in(v) ~~the~~customers ~~regulatory~~onboard ~~environments~~aircraft ~~of the United States and other countries~~ in ~~which~~flight weseeking ~~intend~~improved toInternet ~~operate;~~access ~~· our ability to attract~~ and ~~retain~~connectivity ~~key management~~ and ~~other~~(vi) ~~personnel;~~owners ~~· competition from new market entrants~~ and ~~new~~operators ~~technologies; · our ability to identify and pursue development~~ of ~~appropriate~~private ~~products;~~jets and ·small ~~risks~~aircraft owners, ~~uncertainties~~which ~~and assumptions described under Section 1A. “Risk Factors”~~ in ~~our~~turn, ~~company’s~~can ~~Annual~~provide ~~Report~~additional onaircraft ~~Form 10-K~~ for the ~~fiscal~~Infinitus ~~year~~network. ~~ended~~Infinitus ~~August~~could ~~31,~~also ~~2018,~~provide ~~and~~a inwireless ~~any~~broadband ~~subsequent~~network ~~filings~~that weis ~~make~~not ~~with~~vulnerable ~~the~~or ~~Securities~~susceptible ~~and~~to ~~Exchange~~single ~~Commission~~points ~~(the “SEC”) and under “Management’s Discussion and Analysis~~ of ~~Financial~~failure ~~Condition~~(as ~~and~~is ~~Results~~the ofcase ~~Operations”~~with ~~and~~current ~~elsewhere in this quarterly report~~networks).

~~Forward-looking~~Subject statements are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this document are made as of the date of this document and we do not undertake any obligation to ~~update~~our ~~forward-looking~~ability ~~statements~~ to ~~reflect~~obtain ~~new information~~capital, ~~subsequent events or otherwise, except as required by law. Moreover,~~ we ~~operate~~will incontinue anto ~~evolving~~develop ~~environment~~Infinitus. ~~New~~We ~~risk~~have ~~factors and uncertainties may emerge from time to time, and it is~~ not ~~possible~~licensed ~~for~~Infinitus ~~management~~ to ~~predict~~anyone ~~all~~or ~~risk~~generated ~~factors~~any ~~and~~revenue ~~uncertainties.~~from Weexternal ~~qualify~~customers ~~all~~during ofthe ~~our~~last ~~forward-looking~~three ~~statements~~fiscal ~~by these cautionary statements~~years.

21Our ~~Table~~principal ofexecutive ~~Contents~~office is located at 4115 Guardian Street, Suite C, in Simi Valley, California 93063 and our telephone number is (805) 583-4302. Our corporate website is www.airbornewirelessnetwork.com. Our fiscal year end is August 31.

AsRecent ~~used in this quarterly report, the terms the “Company”, “we”, “us” and “our” refer to Airborne Wireless Network, a Nevada corporation.~~Developments

The Company filed a claim with one of its insurance carriers for damages in shipment, which has been denied. The Company has requested reconsideration of the denial of the claim by the insurance carrier.

~~Airborne~~20 ~~Wireless~~Table ~~Network was formed as a Nevada corporation on January 5, 2011 under the name “Ample-Tee” to engage in the business~~ of ~~promoting, marketing, selling and distributing hard to find ergonomic products for the physically disabled.~~Contents

OnInfinitus ~~October~~was originally based principally on a United States patent that we acquired in August 2016. The patent, which expired on September 20, ~~2015~~2018, ~~our~~gave ~~current~~the ~~President,~~holder ~~Treasurer~~the ~~and~~right ~~Secretary,~~to J.exclude ~~Edwards~~others ~~Daniels~~in the United States, ~~acquired~~commensurate ~~control~~with the scope of the ~~Company~~patent, byfrom ~~purchasing~~creating ~~from~~a ~~Lawrence~~fully ~~Chenard~~meshed, ~~our~~high-speed ~~former~~broadband ~~president,~~wireless ~~2,803~~network ~~shares~~by oflinking ~~our~~commercial ~~common~~aircraft ~~stock~~in ~~for~~flight. We also filed a ~~purchase~~patent ~~price~~application ofin ~~$250,000~~the (2United States on July 25,~~667~~ 2017 seeking rights to exclude others from using our method of synchronizing free space optic links between aircraft in flight, which ~~shares~~technology ~~were~~we ~~delivered~~believe bywill Mrbe instrumental in making Infinitus operate successfully. ~~Daniels~~The topatent ~~the~~application ~~Company~~was ~~for~~recently ~~cancellation~~rejected ~~without~~by ~~consideration~~the inU.S. ~~August~~Patent ~~2016)~~and Trademark Office.

OnResults ~~May~~of ~~19, 2016, we changed our name to “Airborne Wireless Network” to better align our name with our intention to develop and deliver next generation global connectivity.~~Operations

OnThe ~~August~~following 3,summary ~~2016,~~of weour ~~acquired~~results ~~from Apcentive, Inc. (“Apcentive”) all~~ of ~~Apcentive’s~~operations ~~right,~~should ~~title~~be ~~and~~read ~~interest~~ in ~~and~~conjunction towith U.S. Patent No. 6,285,878 B1, which expired on September 20, 2018 and all related support materials, continuations, amendments, updates and contemplated updates and amendments and the trademark “Infinitus Super Highway.” In exchange for that patent and trademark, we issued to Apcentive a number of shares of our ~~common~~financial ~~stock~~statements ~~and~~included ~~agreed~~elsewhere toin ~~pay~~this ~~Apcentive~~quarterly ~~a future royalty equal to 1~~report.~~5% of the net cash we receive from the promotion, marketing, sale, licensing, distribution and other exploitation of that patent.~~

OnTo ~~August 24~~date, ~~2018,~~ we ~~effected~~have anot ~~30,000-to-1~~earned reverse split of our common stock. As a result of the reverse split, every 30,000 pre-split shares of the Company’s common stock outstanding on the effective date of the reverse split were automatically combined into one new share of common stock without any ~~action~~revenues ~~on the part of the holders, and the number of outstanding shares of common stock was reduced~~ from ~~approximately 8,888,443 to approximately 296,000 (subject to the rounding up of fractional shares)~~operations. ~~All historical share balances and share price-related data in this annual report have been adjusted based on the 30,000-to-1 reverse split ratio.~~

WeNine ~~are~~Months anEnded ~~early-stage~~May ~~company with the principal business strategy of developing~~31, ~~marketing~~2019 and licensing a fully meshed, high-speed broadband airborne wireless network by linking aircraft in flight. We call this network the “Infinitus Super Highway.” To our knowledge, no fully meshed commercial broadband airborne network exists in the world today.2018

WeOur ~~expect~~operating ~~that,~~results iffor ~~and~~the ~~when~~nine ~~developed, Infinitus~~months ~~will~~ended ~~provide~~May a31, ~~broadband~~2019 ~~wireless communication infrastructure by using~~ and ~~customizing existing~~2018, ~~small, lightweight, low-power relay station equipment~~ and antennae that will be installed onboard aircraft. Each equipped aircraft would have a broadband wireless communication link to one or more neighboring aircraft and/or ground stations. These aircraft would form a chain of seamless airborne repeaters or routers providing broadband wireless communication gateways along the ~~entire~~changes ~~flight~~between ~~path,~~those ~~essentially~~periods ~~creating~~for ~~a digital superhighway in~~ the ~~sky.~~respective ~~If a link was interrupted~~items, ~~the~~are ~~signal~~summarized ~~would~~as be redirected to the next participating aircraft or ground station in the chain -- in other words, there would be multiple, simultaneous data connections and thus the system would not rely on a single link.follows:

We intend to act as a wholesale carrier, licensing our bandwidth to, among others, data service providers (such as major telecommunications companies and other Internet service providers) that provide broadband services to end users, to government agencies and to companies that desire a more robust private broadband network. We do not plan to license or sell Infinitus directly to consumers. We anticipate that Infinitus will enable our future customers to minimize their infrastructure development time and costs, and increase the reliability of their broadband communications systems.

	Nine Months Ended
	May 31,
Statement of Operations Data:	2019		2018			Changes

Revenue	$	-	$	-		$	-
Total operating expense		14,619,852		54,825,683			(40,205,831	)
Other expense (income)		1,876,002		(278,326	)		2,154,328
Net loss	$	16,495,854	$	54,547,357		$	(38,051,503	)

IfWe weincurred ~~can~~a ~~successfully~~net ~~complete~~loss ~~the development~~ of ~~Infinitus,~~$16.5 ~~which~~million ~~requires~~for ~~additional~~the ~~financing, Infinitus~~nine ~~could~~months ~~provide~~ended ~~high-speed~~May ~~broadband Internet service to (i) supplement or replace current broadband networks~~31, ~~(ii)~~2019 ~~serve currently underserved markets, such~~ as ~~maritime,~~compared ~~rural~~to ~~and~~a ~~remote~~net ~~locations,~~loss ~~(iii)~~of ~~government~~$54.5 ~~agencies,~~million ~~including~~for ~~those~~the ~~that~~same ~~provide~~period ~~emergency~~in or2018. ~~disaster~~The ~~relief~~decrease ~~services,~~in ~~(iv)~~net ~~companies~~loss ~~seeking~~was adue ~~more~~to ~~secure,~~decrease ~~reliable~~in ~~private~~operating ~~data~~expense ~~network,~~and ~~(v)~~other ~~customers~~expense. ~~onboard~~The ~~aircraft~~decrease in ~~flight~~operating ~~seeking~~expense ~~improved~~was ~~Internet~~mainly ~~access~~due ~~and~~to ~~connectivity~~the ~~and~~decrease ~~(vi)~~in ~~owners~~stock-based ~~and~~compensation ~~operators~~expense, ofresearch ~~private jets~~ and ~~small~~development, ~~aircraft~~management ~~owners~~fees, ~~which~~salaries inand ~~turn~~wages, ~~can~~travel ~~provide~~expense ~~additional~~and ~~aircraft~~professional ~~for the Infinitus network~~fees. ~~Infinitus~~The ~~could~~increase ~~also~~in ~~provide~~other aexpense ~~wireless~~relates ~~broadband~~primarily ~~network~~from ~~that~~an isincrease ~~not~~in ~~vulnerable~~loss oron ~~susceptible~~change toin ~~single~~fair ~~points~~value ofon ~~failure~~derivative ~~(as is the case with current networks)~~liabilities.

22We ~~Table~~currently have very limited capital resources and cash flows to support our operations. Until we obtain additional debt or equity financing, we will incur costs at a reduced level compared to prior-year periods, and our development of ~~Contents~~Infinitus and the Company’s business may be materially delayed or terminated.

We21 ~~are~~Table ~~currently~~of ~~continuing to develop Infinitus, and have not licensed Infinitus to anyone or generated any revenue from external customers during the last three fiscal years.~~Contents

Our ~~principal~~operating ~~executive~~expense ~~office~~for isthe ~~located~~nine atmonths ~~4115~~ended ~~Guardian~~May ~~Street~~31, ~~Suite~~2019 C,and ~~in Simi Valley~~2018, ~~California 93063~~ and ~~our~~the ~~telephone~~changes ~~number~~between isthose ~~(805)~~periods ~~583-4302.~~for ~~Our~~the ~~corporate~~respective ~~website~~items, isare ~~www.airbornewirelessnetwork.com.~~summarized ~~Our~~as ~~fiscal year end is August 31.~~follows:

Recent Developments

	Nine Months Ended
	May 31,
Operating Expense:	2019		2018		Changes

Marketing and branding	$	3,235,882	$	4,227,012	$	(991,130	)
Depreciation		9,372		7,345		2,027
General and administrative expenses		451,946		786,835		(334,889	)
Management fees		-		102,000		(102,000	)
Professional fees		2,003,068		4,049,113		(2,046,045	)
Research and development		55,141		588,042		(532,901	)
Salaries and wages		301,347		786,510		(485,163	)
Stock based compensation		8,563,096		44,278,826		(35,715,730	)
Total operating expense	$	14,619,852	$	54,825,683	$	(40,205,831	)

~~Although~~The ~~our~~largest ~~software~~component ~~platform~~of ~~has~~the ~~been~~operating ~~substantially~~expense ~~completed~~was $8.6 million of stock-based compensation expenses incurred during nine months ended May 31, we2019 ~~have~~compared ~~had~~to ~~several~~$44.3 ~~issues~~million of stock-based compensation expenses incurred for the same period in 2018. In the nine months ended May 31, 2019, stock compensation expense included: (i) $20,654 in connection with the ~~lasers~~issuance ~~manufactured~~of 71,284,910 ~~sold~~shares of common stock to Jet Midwest Group pursuant to our service agreement with that company; and ~~shipped~~(ii) by$8.5 ~~Mynaric~~million AGwith respect to employee stock options. In the nine months ended May 31, 2018, stock compensation expense included: (i) $2.0 million in connection with the issuance of 70 shares of common stock and ~~Mynaric~~$13.6 ~~Lasercom~~million ~~GmBH~~in connection with the issuance of 191 warrants to purchase shares to Air Lease Corporation pursuant to our marketing agreement with that company; (~~formerly~~ii) ~~known~~$316,252 asin ~~Vialight~~connection ~~Communications~~with ~~GmBH~~the issuance of 12 shares of common stock to Jet Midwest Group pursuant to our service agreement with that company; (iii) $128,800 in connection with the issuance of ~~Gilching~~3 ~~Germany.~~shares ~~The~~of ~~lasers~~common ~~are~~stock anand ~~integral~~$314,923 ~~component~~in connection with the issuance of ~~Infinitus~~8 warrants to purchase shares to Brighton Capital Ltd. pursuant to our consulting agreement with that company; (iv) $22 million with respect to employee stock options; (v) $5.5 million in connection with the issuance of 118 warrants to purchase shares to shareholders; (vi) $408,164 in connection with the issuance of 12 shares of common stock for services.

~~The~~Marketing ~~Company~~and ~~paid~~branding ~~Mynaric~~expenses ~~$1,134,706~~incurred ~~for~~relate ~~the~~to ~~lasers~~television onand ~~June~~print ~~20,~~advertising ~~2018~~for branding purposes. ~~The~~We ~~lasers~~believe ~~were~~that ~~damaged~~building ~~when~~recognition ~~received~~for byour ~~the~~brand ~~Company~~enhances inour ~~shipment~~reputation ~~due~~and ultimately our ability to, ~~among~~attract ~~things~~technology, ~~inadequate~~financial and ~~negligent~~other ~~packaging~~companies bywhich ~~Mynaric~~can ofpotentially ~~the~~assist ~~lasers.~~us ~~Mynaric~~in ~~refused~~developing toand ~~repair~~commercializing Infinitus. For the ~~lasers~~nine ~~despite,~~months ~~among~~ended ~~other~~May ~~things~~31, ~~the~~2019, ~~warranty~~we ~~Mynaric~~recorded ~~provided~~$3.2 tomillion ~~the~~in ~~Company~~marketing and branding expenses. The ~~Company~~majority ~~was~~of ~~required~~these toexpenses ~~pay~~reflect anthe ~~additional~~accrual ~~$120,000~~of tothe ~~Mynaric~~maximum ~~for~~amount ~~Mynaric~~we tomay ~~attempt~~owe tounder ~~repair~~a ~~the~~contract ~~lasers.~~with ~~Since~~a ~~the~~vendor ~~return~~to ofpurchase ~~the~~media ~~so-called~~time ~~repaired~~for ~~lasers~~our bymarketing ~~Mynaric,~~and ~~the~~branding ~~Company~~messages, ~~has~~although ~~been~~the ~~required~~amount towe ~~continually~~may ~~repair~~ultimately ~~the~~pay ~~lasers,~~to ~~while~~this ~~incurring~~vendor ~~additional~~is ~~costs~~uncertain and ~~significant~~in ~~delays~~dispute. ToOther ~~date,~~than ~~the~~this ~~lasers~~and ~~have~~other ~~never~~accruals, ~~functioned~~none asof ~~advertised~~which ~~and~~were asmaterial, ~~represented~~we ~~and~~did ~~warranted~~not byotherwise ~~Mynaric.~~incur ~~After~~any ~~exhaustive~~new ~~testing~~marketing and ~~related~~branding ~~efforts~~expenses, wewhereas, ~~have~~$4.2 ~~determined~~million ~~that~~was ~~the~~incurred ~~lasers~~by weour ~~purchased~~Company ~~from~~during ~~Mynaric~~the ~~are~~nine ~~beyond~~months ~~repair~~ended ~~and~~May ~~also~~31, ~~maybe~~2018. ~~inherently~~We ~~defective,~~expect ~~poorly~~to ~~manufactured,~~incur ~~not~~expenditures ~~manufactured~~on marketing and branding in ~~accordance~~future ~~with~~fiscal ~~specifications~~periods ~~provided~~if byand ~~Mynaric~~when cash flow is available, ~~are~~as ~~not~~we ~~suitable~~plan ~~for~~to ~~the~~continue ~~purpose~~to ~~intended~~develop Infinitus, ~~and~~however, ~~may~~until bewe ~~inherently~~obtain ~~dangerous.~~additional ~~Further~~or equity financing, ~~Mynaric~~we ~~failed~~will be unable to ~~provide~~continue ~~instructions~~spending oron ~~support~~marketing ~~for~~and ~~the~~branding ~~lasers~~efforts.

~~Even~~Professional ~~though~~fees ~~Mynaric~~include ~~has~~fees ~~sent engineers~~ to usconsultants, atinvestor ~~our~~relations ~~expense~~firms, ~~Mynaric~~and ~~has~~legal, ~~been~~accounting ~~unable~~and tocompliance ~~demonstrate~~professionals ~~that~~for ~~the~~our ~~lasers~~audit, ~~are~~SEC ~~repaired~~filings, ~~and~~securities ~~function~~offerings and ~~we have determined that we cannot continue with Mynaric’s lasers~~contracts. ~~Simultaneously~~During ~~with attempting to make~~ the ~~Mynaric~~nine ~~lasers~~months ~~try~~ended toMay ~~work~~31, we2019, ~~have~~professional ~~been~~fees ~~seeking~~were ~~alternative~~$2.0 ~~manufacturers~~million ~~and~~compared ~~are~~to ~~exploring those options~~$4.0 ~~The~~million ~~Company~~for ~~intends~~the tocomparative ~~seek~~period ~~either~~in a2018. ~~buyback~~The ofdecrease ~~those~~in ~~units~~professional ~~from~~fees ~~Mynaric~~were ormainly ~~intends~~due to ~~seek~~a ~~damages,~~decrease ~~including~~in ~~consequential~~consulting ~~damages,~~fees. ~~through~~We ~~legal~~expect ~~action~~to ~~against~~continue ~~Mynaric.~~to ~~The~~incur ~~delay~~professional infees ~~our~~at ~~development~~this ofcurrent ~~Infinitus~~level ~~and~~for the ~~Company’s~~foreseeable ~~potential~~future ~~success~~in isconnection ~~directly~~with ~~related~~capital-raising totransactions, ~~the~~regulatory ~~damaged~~compliance and ~~defective~~responses ~~lasers~~and ~~sold~~other torelated ~~the Company by Mynaric~~matters.

~~Infinitus~~Research ~~was~~and ~~originally~~development ~~based~~expenses ~~principally~~incurred onrelate ato ~~United~~the ~~States~~development ~~patent~~of ~~that~~Infinitus westarting ~~acquired~~ in August 2016. ~~The~~During ~~patent,~~the ~~which~~nine ~~expired~~months onended ~~September~~May 2031, ~~2018~~2019, ~~gave~~research ~~the~~and ~~holder~~development ~~the~~expense ~~right~~was $55,141, as compared to ~~exclude~~$588,042 ~~others~~during the same period in ~~the~~2018. ~~United~~The ~~States,~~decrease ~~commensurate~~in ~~with~~our ~~the~~research ~~scope~~and ofdevelopment ~~the~~spending ~~patent,~~during ~~from~~the ~~creating~~nine amonths ~~fully~~ended ~~meshed~~May 31, ~~high-speed~~2019 ~~broadband~~was ~~wireless~~due ~~network~~to byour ~~linking~~lack ~~commercial~~of ~~aircraft~~adequate incapital ~~flight.~~resources Weto ~~also~~support ~~filed~~our aoperations. ~~patent~~Had ~~application~~the inCompany ~~the~~had ~~United~~access ~~States~~to ongreater ~~July~~capital 25resources, ~~2017~~including ~~seeking~~cash ~~rights~~on tohand, ~~exclude~~during ~~others~~this ~~from~~period, ~~using~~the ~~our~~Company ~~method~~would ofhave ~~synchronizing~~spent ~~free~~a ~~space~~greater ~~optic~~amount ~~links~~on ~~between~~research ~~aircraft~~and indevelopment. ~~flight,~~Until ~~which technology~~ we ~~believe~~obtain ~~will~~additional bedebt ~~instrumental~~or inequity ~~making~~financing, ~~Infinitus~~we ~~operate~~will ~~successfully.~~be ~~The~~unable ~~patent~~to ~~application~~increase ~~was~~spending ~~recently~~on ~~rejected~~research byand ~~the~~development, ~~U.S.~~and ~~Patent~~unable ~~and~~to ~~Trademark~~prepare ~~Office,~~for ~~but~~our weplanned ~~believe~~two-plane ~~there~~test ~~are~~and ~~adequate~~the ~~grounds~~eventual ~~for~~20-plane ~~appeal~~test.

~~Results~~General ofand ~~Operations~~administrative expenses include office, shipping, entertainment, travel, insurance and other miscellaneous expenses. During the nine months ended May 31, 2019, general and administrative expenses decreased primarily from travel costs decreasing by $274,000 as compared to the same period in 2018.

~~The~~22 ~~following~~Table ~~summary~~ of ~~our results of operations should be read in conjunction with our financial statements included elsewhere in this quarterly report.~~Contents

ToOur ~~date~~other (income) expense for the nine months ended May 31, we2019 ~~have~~and ~~not~~2018, ~~earned~~and ~~any~~the ~~revenues~~changes ~~from~~between ~~operations.~~those periods for the respective items, are summarized as follows:

Six Months Ended February 28, 2019 and February 28, 2018

	Nine Months Ended
	May 31,
Other (Income) Expenses	2019		2018			Changes

Interest expense	$	1,021,778	$	4,755,835		$	(3,734,057	)
Change in fair value of derivative liabilities		854,224		(5,034,161	)		5,888,385
Total other (income) expense	$	1,876,002	$	(278,326	)	$	2,154,328

~~Our~~During ~~operating results for~~ the ~~six~~nine months ended ~~February~~May 2831, 2019, ~~and~~our ~~2018~~Company incurred $1.9 million in other expense which included a loss on change in fair value of derivative liabilities of $854,000 and ~~the~~interest ~~changes~~expense ~~between~~of ~~those~~$1.0 ~~periods~~million. ~~for~~The loss on change in fair value of derivative liabilities related to $1.3 million as a day one loss from the ~~respective~~addition ~~items~~of new derivative liabilities recognized upon issuance of convertible preferred stock and a gain of $406,000 ~~are~~in ~~summarized~~the change in the fair value of derivative liabilities, as ~~follows:~~calculated using Black-Scholes option model. The interest expense includes amortization of debt discount and interest incurred on convertible notes during the nine months ended May 31, 2019.

	Six Months Ended
	February 28,
Statement of Operations Data:	2019		2018		Changes
Revenue	$	-	$	-	$	-
Total operating expense		12,673,841		44,349,428		(31,675,587	)
Other expense		1,738,977		4,103,864		(2,364,887	)
Net loss	$	14,412,818	$	48,453,292	$	(34,040,474	)

During the nine months ended May 31, 2018, our Company recognized $(278,326) in other (income) which included a net gain on change in fair value of derivative liabilities of $5.0 million and interest expense of $4.8 million. The gain on change in fair value of derivative liabilities related to $4.1 million as a day one loss in the fair value of warrants and convertible notes recorded as a derivative liability, $7.8 million as a day one loss from the addition of new derivative liabilities recognized upon issuance of convertible preferred stock and a gain of $16.9 million in the change in the fair value of derivative liabilities, as calculated using Black-Scholes option model. The interest expense includes amortization of debt discount and interest incurred on convertible notes issued during the nine months ended May 31, 2018.

23Three ~~Table~~Months ofEnded ~~Contents~~May 31, 2019 and 2018

WeOur ~~incurred~~operating aresults ~~net loss of $14.4 million~~ for the ~~six~~three months ended ~~February~~May 2831, 2019 asand ~~compared to a net loss of $48.5 million for the same period in~~ 2018., ~~The decrease in net loss was due to decrease in operating expense~~ and ~~other expense. The decrease in operating expense was mainly due to~~ the ~~decrease~~changes inbetween ~~stock-based~~those ~~compensation~~periods ~~expense, research and development, salaries and wages and professional fees. The decrease in other expense relates primarily from a decrease in loss on change in fair value on derivative liabilities~~ for the ~~six~~respective ~~months ended February 28~~items, ~~2019~~are ~~due~~summarized toas ~~the decline in market price of our common stock, and the decrease in note interest expense and amortization of debt discount from convertible notes.~~ follows:

We currently have very limited capital resources and cash flows to support our operations. Until we obtain additional debt or equity financing, we will incur costs at a reduced level compared to prior-year periods, and our development of Infinitus and the Company’s business may be materially delayed or terminated.

	Three Months Ended
	May 31,
Statement of Operations Data:	2019		2018			Changes

Revenue	$	-	$	-		$	-
Total operating expense		1,946,011		10,476,255			(8,530,244	)
Other expense (income)		137,025		(4,382,190	)		4,519,215	)
Net loss	$	2,083,036	$	6,094,065		$	(4,011,029	))

~~Our~~We ~~operating~~incurred ~~expense~~a net loss of $2.1 million for the ~~six~~three months ended ~~February~~May 2831, 2019 ~~and~~as compared to a net loss of $6.1 million for the same period in 2018,. The decrease in net loss was due to decrease in operating expense and other income. The decrease in operating expense was mainly due to the ~~changes~~decrease ~~between~~in ~~those~~stock-based ~~periods~~compensation expense, marketing and branding, professional fees, research and development, management fees and salaries and wages. The decrease in other income relates primarily from a decrease in gain on change in fair value on derivative liabilities for the ~~respective~~three ~~items,~~months ~~are~~ended ~~summarized~~May as31, ~~follows:~~2019.

	Six Months Ended
	February 28,
Operating Expense:	2019		2018		Changes
Marketing and branding	$	3,235,882	$	2,971,732	$	264,150
Depreciation		6,248		4,552		1,696
General and administrative expenses		244,521		320,032		(75,511	)
Management fees		-		42,000		(42,000	)
Professional fees		1,896,030		2,000,517		(104,487	)
Research and development		55,141		569,942		(514,801	)
Salaries and wages		297,311		479,279		(181,968	)
Stock based compensation		6,938,708		37,961,374		(31,022,666	)
Total operating expense	$	12,673,841	$	44,349,428	$	(31,675,587	)

Table of Contents

~~The~~Our ~~largest component of the~~ operating ~~expense was $6.9 million of stock-based compensation~~ expenses ~~incurred during six months ended February 28, 2019 compared to $38.0 million of stock-based compensation expenses incurred~~ for the ~~same~~three ~~period in 2018. In the six~~ months ended ~~February~~May 2831, 2019, ~~stock compensation expense included: (i) $19,354 in connection with the issuance of 58,286,425 shares of common stock to Jet Midwest Group pursuant to our service agreement with that company;~~ and ~~(ii) $6.9 million with respect to employee stock options. In the six months ended February 28,~~ 2018, stock compensation expense included: (i) $1 million in connection with the issuance of 20 shares of common stock to Air Lease Corporation pursuant to our marketing agreement with that company; (ii) $162,616 in connection with the issuance of 4 shares of common stock to Jet Midwest Group pursuant to our service agreement with that company; (iii) $90,400 in connection with the issuance of 6 shares of common stock and ~~$214,019 in connection with~~ the ~~issuance~~changes ofbetween 5those ~~shares~~periods offor ~~warrants to Brighton Capital Ltd. pursuant to our consulting agreement with that company; (iv) $31 million with respect to employee stock options; (v) $5.3 million in connection with~~ the ~~issuance~~respective ~~of 131 shares of replacement warrants to shareholders; and (vi) $208~~items,~~164~~ inare ~~connection~~summarized ~~with~~as ~~the issuance of 3 shares of common stock for services.~~ follows:

Marketing and branding expenses incurred relate to television and print advertising for branding purposes. We believe that building recognition for our brand enhances our reputation and ultimately our ability to attract technology, financial and other companies which can potentially assist us in developing and commercializing Infinitus. For the six months ended February 28, 2019, we recorded $3.2 million in marketing and branding expenses. The majority of these expenses reflect the accrual of the maximum amount we may owe under a contract with a vendor to purchase media time for our marketing and branding messages, although the amount we may ultimately pay to this vendor is uncertain and in dispute. Other than this and other accruals, none of which were material, we did not otherwise incur any new marketing and branding expenses, whereas, $2.9 million was incurred by our Company during the six months ended February 28, 2018. We expect to incur expenditures on marketing and branding in future fiscal periods if and when cash flow is available, as we plan to continue to develop Infinitus, however, until we obtain additional or equity financing, we will be unable to continue spending on marketing and branding efforts.

	Three Months Ended
	May 31,
Operating Expense:	2019		2018		Changes

Marketing and branding	$	-	$	1,255,280	$	(1,255,280	)
Depreciation and amortization		3,124		2,793		331
General and administrative expenses		207,426		466,803		(259,378	)
Management fees		-		60,000		(60,000	)
Professional fees		107,038		2,048,596		(1,941,558	)
Research and development		-		18,100		(18,100	)
Salaries and wages		4,036		307,231		(303,195	)
Stock based compensation		1,624,387		6,317,452		(4,693,064	)
Total operating expense	$	1,946,011	$	10,476,255	$	(8,530,244	)

24The ~~Table~~largest component of ~~Contents~~the operating expense was $1.6 million of stock-based compensation expenses incurred during three months ended May 31, 2019 compared to $6.3 million of stock-based compensation expenses incurred for the same period in 2018. In the three months ended May 31, 2019, stock compensation expense included: (i) $1,300 in connection with the issuance of 12,998,485 shares of common stock to Jet Midwest Group pursuant to our service agreement with that company; and (ii) $1.6 million with respect to employee stock options. In the three months ended May 31, 2018, stock compensation expense included: (i) $960,225 in connection with the issuance of 52 shares of common stock and $13.6 million in connection with the issuance of 191 warrants to purchase shares to Air Lease Corporation pursuant to our marketing agreement with that company; (ii) $153,636 in connection with the issuance of 244,983 shares of common stock to Jet Midwest Group pursuant to our service agreement with that company; (iii) $38,400 in connection with the issuance of 1 shares of common stock and $100,904 in connection with the issuance of 3 warrants to purchase shares to Brighton Capital Ltd. pursuant to our consulting agreement with that company; (iv) $4.7 million with respect to employee stock options; (v) $163,279 in connection with the issuance of 6 warrants to purchase shares to shareholders; (vi) $200,000 in connection with the issuance of 10 shares of common stock for services.

~~Professional~~Marketing ~~fees~~and ~~include~~branding ~~fees~~expenses incurred relate to ~~consultants,~~television ~~investor~~and ~~relations~~print ~~firms,~~advertising ~~and~~for ~~legal,~~branding ~~accounting~~purposes. ~~and~~We ~~compliance~~believe ~~professionals~~that building recognition for our ~~audit,~~brand ~~SEC~~enhances ~~filings~~our reputation and ultimately our ability to attract technology, ~~securities~~financial ~~offerings~~and other companies which can potentially assist us in developing and ~~contracts~~commercializing Infinitus. ~~During~~For the ~~six~~three months ended ~~February~~May 2831, 2019, ~~professional~~we ~~fees~~did ~~were~~not ~~$1.9~~spend ~~million~~marketing and branding, as compared to $21.03 million ~~for~~incurred by our Company during the ~~comparative~~three ~~period~~months inended May 31, 2018. ~~The~~We ~~decrease~~expect to incur expenditures on marketing and branding in ~~professional~~future ~~fees~~fiscal ~~were~~periods ~~mainly~~if ~~due~~and towhen acash ~~decrease~~flow inis ~~consulting~~available, ~~fees.~~as Wewe ~~expect~~plan to continue to ~~incur~~develop ~~professional~~Infinitus, ~~fees~~however, atuntil ~~this~~we ~~current~~obtain ~~level~~additional ~~for~~or ~~the~~equity ~~foreseeable~~financing, ~~future~~we inwill ~~connection~~be ~~with~~unable ~~capital-raising~~to ~~transactions,~~continue ~~regulatory~~spending ~~compliance~~on ~~and~~marketing ~~responses~~ and ~~other~~branding ~~related matters~~efforts.

~~Research~~Professional fees include fees to consultants, investor relations firms, and ~~development~~legal, ~~expenses~~accounting ~~incurred~~and ~~relate~~compliance toprofessionals ~~the~~for ~~development~~our ofaudit, ~~Infinitus~~SEC ~~starting~~filings, insecurities ~~August~~offerings ~~2016~~and contracts. During the ~~six~~three months ended ~~February~~May 2831, 2019, ~~research~~professional ~~and~~fees ~~development~~were ~~expense was~~ $55107,~~141,~~000 as compared to $~~570,000~~2.0 ~~during~~million for the ~~same~~comparative period in 2018. The decrease in ~~our~~professional ~~research~~fees ~~and~~were ~~development~~mainly ~~spending during the six months ended February 28, 2019 was~~ due to ~~our~~a ~~lack~~decrease ofin ~~adequate~~consulting ~~capital~~fees ~~resources~~and tolegal ~~support our operations~~fees. ~~Had~~We ~~the~~expect ~~Company~~to ~~had~~continue ~~access~~ to ~~greater~~incur ~~capital~~professional ~~resources,~~fees ~~including~~at ~~cash~~this oncurrent ~~hand,~~level ~~during~~for ~~this period,~~ the ~~Company~~foreseeable ~~would~~future ~~have~~in ~~spent~~connection awith ~~greater~~capital-raising ~~amount on research and development. Until we obtain additional debt or equity financing~~transactions, weregulatory ~~will~~compliance ~~be unable to increase spending on research~~ and ~~development,~~responses and ~~unable~~other torelated ~~prepare for our planned two-plane test and the eventual 20-plane test~~matters.

~~General~~Research and ~~administrative~~development expenses ~~include~~incurred ~~office,~~relate ~~shipping,~~to ~~entertainment,~~the ~~travel,~~development ~~insurance~~of ~~and~~Infinitus ~~other~~starting ~~miscellaneous~~in ~~expenses~~August 2016. During the ~~six~~three months ended ~~February~~May 2831, 2019, ~~general~~we ~~and~~did ~~administrative~~not ~~expenses~~spend ~~decreased~~on ~~primarily~~research ~~from~~and ~~travel~~development ~~costs~~expense, ~~decreasing~~as bycompared to $7618,000 asincurred ~~compared~~during to the same period in 2018. The decrease in our research and development spending during the three months ended May 31, 2019 was due to our lack of adequate capital resources to support our operations. Had the Company had access to greater capital resources, including cash on hand, during this period, the Company would have spent a greater amount on research and development. Until we obtain additional debt or equity financing, we will be unable to increase spending on research and development, and unable to prepare for our planned two-plane test and the eventual 20-plane test.

~~Our~~24 ~~other~~Table ~~(income)~~of ~~expense for the six months ended February 28, 2019 and 2018, and the changes between those periods for the respective items, are summarized as follows:~~Contents

	Six Months Ended
	February 28,
Other Expenses	2019		2018		Changes
Interest expense	$	913,024	$	1,561,908	$	(648,884	)
Change in fair value of derivative liabilities		825,953		2,541,956		(1,716,003	)
Total other expense	$	1,738,977	$	4,103,864	$	(2,364,887	)

General and administrative expenses include office, shipping, entertainment, travel, insurance and other miscellaneous expenses. During the three months ended May 31, 2019, general and administrative expenses decreased primarily from travel costs decreasing by $189,000 as compared to the same period in 2018.

~~During~~Our ~~the six months ended February 28, 2019, our Company incurred $1.7 million in~~ other ~~expense~~(income) ~~which included a loss on change in fair value of derivative liabilities of $826,000 and interest~~ expense offor ~~$913,000. The loss on change in fair value of derivative liabilities related to $1.2 million as a day one loss from~~ the ~~addition~~nine ofmonths ~~new~~ended ~~derivative~~May ~~liabilities~~31, ~~recognized~~2019 ~~upon issuance of convertible preferred stock~~ and ~~a gain of $406~~2018,~~000~~ inand the ~~change~~changes inbetween ~~the~~those ~~fair~~periods ~~value~~for ofthe ~~derivative~~respective ~~liabilities~~items, asare ~~calculated~~summarized ~~using~~as ~~Black-Scholes option model. The interest expense includes amortization of debt discount and interest incurred on convertible notes during the six months ended February 28, 2019.~~follows:

During the six months ended February 28, 2018, our Company incurred $4.1 million in other expenses which include loss on change in fair value of derivative liabilities of $2.5 million and Interest expense of $1.6 million. The loss on change in fair value of derivative liabilities related to $1,141,581 as a day one loss in the fair value of warrants and convertible notes recorded as a derivative liability and a loss of $1,400,375 in the change in the fair value of derivative liabilities, as calculated using Black-Scholes option model. The interest expense includes amortization of debt discount and interest incurred on convertible notes issued during the six months ended February 28, 2018.

	Three Months Ended
	May 31,
Other (Income) Expense	2019		2018			Changes

Interest expense	$	108,754	$	3,193,927		$	(3,085,173	)
Change in fair value of derivative liabilities		28,271		(7,576,117	)		7,604,388
Total other (income) expense	$	137,025	$	(4,382,190	)	$	4,519,215

25During ~~Table~~the three months ended May 31, 2019, our Company incurred $137,025 in other expense which included a loss on change in fair value of ~~Contents~~derivative liabilities of $28,271 and interest expense of $108,754. The loss on change in fair value of derivative liabilities related to $27,879 as a day one loss from the addition of new derivative liabilities recognized upon issuance of convertible preferred stock and a loss of $392 in the change in the fair value of derivative liabilities, as calculated using Black-Scholes option model. The interest expense includes amortization of debt discount and interest incurred on convertible notes during the three months ended May 31, 2019.

~~Three~~During ~~Months~~the ~~Ended~~three ~~February~~months 28ended May 31, ~~2019~~2018, our company recognized $4.4 million in other income which included a net gain on change in fair value of derivative liabilities of $7.6 million and ~~February~~interest 28expense of $3.2 million. The gain on change in fair value of derivative liabilities includes a day one loss in the fair value of warrants and convertible notes recorded as a derivative liability and a gain from the change in the fair value of derivative liabilities, as calculated using Black-Scholes option model. The interest expense includes amortization of debt discount and interest incurred on convertible notes during the three months ended May 31, 2018.

~~Our~~Liquidity ~~operating results for the three months ended February 28, 2019~~ and ~~2018,~~Capital ~~and the changes between those periods for the respective items, are summarized as follows:~~Resources

	Three Months Ended
	February 28,
Statement of Operations Data:	2019		2018		Changes
Revenue	$	-	$	-	$	-
Total operating expense		3,192,303		35,808,404		(32,616,101	)
Other expense		1,409,566		2,588,192		(1,178,626	)
Net loss	$	4,601,869	$	38,396,596	$	(33,794,727	)

The following table presents selected financial information as of and for the nine months ended May 31, 2019, and 2018:

We incurred a net loss of $4.6 million for the three months ended February 28, 2019 as compared to a net loss of $38.4 million for the same period in 2018. The decrease in net loss was due to decrease in operating expense and other expense. The decrease in operating expense was mainly due to the decrease in stock-based compensation expense, advertising and marketing, professional fees, research and development and salaries and wages. The decrease in other expense relates primarily from a decrease in loss on change in fair value on derivative liabilities for the three months ended February 28, 2019 due to the decline in market price of our common stock, and the decrease in note interest expense and amortization of debt discount from convertible notes.

	May 31,			August 31,
Balance Sheet Data:	2019			2018			Changes

Cash	$	11,514		$	155,988		$	(144,474	)
Working capital (deficiency)	$	(14,772,480	)	$	(9,271,865	)	$	(5,500,615	)
Total assets	$	91,492		$	1,210,248		$	(1,118,756	)
Total liabilities	$	14,838,734		$	10,447,503		$	4,391,231
Total stockholders’ equity (deficit)	$	(14,747,242	)	$	(9,237,255	)	$	(5,509,987	)

~~Our~~Because ~~operating~~we ~~expenses~~have ~~for~~not generated any revenues, we depend on proceeds from the ~~three~~sales ~~months~~of ~~ended~~securities ~~February~~and 28loans to finance our operations. As previously disclosed, ~~2019~~on ~~and~~May 29, 2018, we completed a public offering of 8,000 units consisting of 8,000 shares of our Series A Convertible Preferred Stock (the “Preferred Stock”) and 24,000 warrants to purchase additional shares of Preferred Stock from which we generated $6.7 million, after deducting underwriting discounts and other expenses of the ~~changes~~offering. ~~between~~Maxim ~~those~~Group ~~periods~~LLC ~~for~~was the ~~respective~~underwriter ~~items~~and four funds were the initial purchasers of the Preferred Stock and Warrants. If all of the warrants included in the offering were exercised, ~~are~~then ~~summarized~~the asCompany ~~follows:~~could have received additional gross proceeds of up to $24 million.

	Three Months Ended
	February 28,
Operating Expense:	2019		2018		Changes
Advertising and marketing	$	4,499	$	1,882,452	$	(1,877,953	)
Depreciation and amortization		3,124		2,464		660
General and administrative expenses		87,321		205,290		(117,969	)
Management fees		-		42,000		(42,000	)
Professional fees		393,262		1,143,232		(749,970	)
Research and development		-		284,053		(284,053	)
Salaries and wages		75,717		250,064		(174,347	)
Stock based compensation		2,628,380		31,998,849		(29,370,469	)
Total operating expense	$	3,192,303	$	35,808,404	$	(32,616,101	)

Table of Contents

~~The~~A ~~largest~~total ~~component~~ of ~~the~~1,510 ~~operating~~warrants ~~expense~~were ~~was~~exercised, ~~$2.6~~and ~~million~~the ofCompany ~~stock-based~~received ~~compensation~~additional ~~expenses~~gross ~~incurred~~proceeds ~~during~~of ~~three~~$1,510,000. ~~months~~The ~~ended~~balance ~~February~~of ~~28,~~the ~~2019~~warrants ~~compared~~expired toon ~~$32.0~~May ~~million~~29, of2019 ~~stock-based~~and ~~compensation~~the ~~expenses~~Company ~~incurred~~does ~~for~~not ~~the~~envision ~~same~~any ~~period~~further inwarrants ~~2018~~being exercised. InThe ~~the~~Company ~~three~~received ~~months~~a ~~ended~~total ~~February~~of ~~28,~~$8.2 ~~2019,~~million ~~stock~~(instead ~~compensation~~of ~~expense~~the ~~included:~~contemplated ~~(i)~~ $~~1,205~~30.7 inmillion) ~~connection~~from ~~with~~ the ~~issuance of 12~~8,~~043,636~~000 shares of ~~common~~the ~~stock~~Preferred toStock ~~Jet~~and ~~Midwest~~1,510 ~~Group~~warrants ~~pursuant~~exercised. toThe ~~our~~four ~~service~~funds ~~agreement~~have ~~with~~converted ~~that~~approximately ~~company;~~7,202 ~~and~~shares ~~(ii)~~of ~~$2.6~~Preferred ~~million~~Stock ~~with~~and ~~respect~~1,211 toshares ~~employee~~of ~~stock~~Preferred ~~options.~~Stock Inconverted ~~the~~from ~~three~~warrants ~~months~~into ~~ended~~approximately ~~February~~4.2 ~~28,~~billion ~~2018,~~shares ~~stock~~of ~~compensation~~common ~~expense~~stock ~~included:~~and ~~(i)~~still ~~$848~~have 1,~~515~~097 inshares ~~connection~~of ~~with~~Preferred ~~the~~Stock ~~issuance~~convertible ofinto 16common shares of ~~common~~the ~~stock~~Company toas ~~Air~~of ~~Lease~~May ~~Corporation~~31, ~~pursuant~~2019. to(Based ~~our~~upon ~~marketing~~the ~~agreement~~current ~~with~~conversion ~~that~~price ~~company;~~at ~~(ii)~~May ~~$135~~31,~~762~~ in2019, ~~connection with~~ the ~~issuance~~balance of 3the ~~shares~~Preferred ofShares ~~common~~could ~~stock~~be toconverted ~~Jet~~into ~~Midwest~~an ~~Group~~additional ~~pursuant~~15.3 tobillion ~~our~~shares ~~service~~of ~~agreement~~common ~~with~~stock. ~~that~~In ~~company;~~essence, ~~(iii)~~the $~~51,900~~8.2 inmillion ~~connection with~~ the ~~issuance~~Company ofreceived 3from ~~shares~~the ofPreferred ~~common~~Stock ~~stock~~ and ~~$120,024~~exercised inWarrants ~~connection~~underwritten ~~with~~by ~~the~~Maxim ~~issuance~~Group ofLLC 3could ~~shares~~require ofthe ~~warrants~~Company to ~~Brighton~~issue ~~Capital Ltd~~19.5 ~~pursuant~~billion toshares ~~our~~of ~~consulting~~common ~~agreement~~stock ~~with~~or ~~that~~an ~~company;~~average ~~(iv)~~price of $250.0004 ~~million~~per ~~with~~share ~~respect~~of tocommon ~~employee~~ stock ~~options; (v) $5~~.2 ~~million~~On inthe ~~connection~~date ~~with~~of the ~~issuance~~closing of ~~117~~the ~~shares~~Preferred ofStock ~~replacement~~and ~~warrants~~Warrants tounderwritten ~~shareholders;~~by ~~and~~Maxim ~~(vi)~~Group ~~$208~~LLC,~~164~~ inthe ~~connection~~common ~~with~~stock of the ~~issuance~~Company ofclosed 3at ~~shares~~$7,000.00 ofand ~~common~~the ~~stock~~Company ~~for~~had ~~services~~3,498 Incommon shares outstanding.) During the ~~three~~nine months ended ~~February~~May 2831, ~~2017~~2019, ~~stock~~we ~~compensation~~generated ~~expense~~proceeds ~~attributed~~from toPreferred ~~$25~~Stock ~~million~~issued from ~~employee~~the ~~stock~~exercise ~~options~~of warrants of $910,000.

~~Marketing~~Because ~~and~~we ~~branding~~currently ~~expenses~~do ~~incurred~~not ~~relate~~generate torevenue, ~~television~~we ~~and~~must ~~print~~obtain ~~advertising~~additional ~~for~~financing ~~branding~~to ~~purposes~~continue operations at our current level. We ~~believe~~currently ~~that~~do ~~building~~not ~~recognition~~have ~~for~~enough ~~our~~cash ~~brand~~on ~~enhances~~hand to fund our ~~reputation~~contemplated ~~and~~two-plane ~~ultimately~~test and our ~~ability~~current tooperations. ~~attract~~We ~~technology,~~are ~~financial~~unsure ~~and~~that ~~other~~we ~~companies~~will ~~which~~be ~~can~~able ~~potentially~~to ~~assist~~secure usadditional inprivate ~~developing~~ and ~~commercializing~~public ~~Infinitus.~~financing ~~For~~in the ~~three~~future. ~~months~~We ~~ended~~can ~~February~~give ~~28,~~no ~~2019,~~assurance that we ~~recorded~~can ~~$4,500~~obtain inany ~~marketing~~additional ~~and~~financing, ~~branding~~or ~~expenses,~~if assuch ~~compared~~financing tois ~~$1.9~~available, ~~million~~that ~~incurred~~it bywould ~~our~~be ~~Company~~available ~~during~~on ~~the~~terms ~~three~~generally ~~months~~as ~~ended~~favorable ~~February~~as ~~28,~~terms ~~2018~~of recent financings. We ~~expect~~believe our ability to ~~incur~~secure ~~expenditures~~such onadditional ~~marketing~~funding ~~and~~has ~~branding~~been made more difficult by declines in ~~future~~the ~~fiscal~~trading ~~periods~~price ifof our common stock and ~~when~~the ~~cash~~drastic ~~flow~~increase isin ~~available,~~the asnumber weof ~~plan~~shares tooutstanding ~~continue~~resulting tofrom ~~develop~~conversions ~~Infinitus,~~of ~~however,~~the ~~until~~Preferred weStock ~~obtain~~by ~~additional~~the orholders ~~equity~~thereof ~~financing,~~at weconversion ~~will~~prices beunfavorable ~~unable~~to us due to ~~continue~~the ~~spending~~market-price-based onnature ~~marketing~~of ~~and~~the ~~branding~~conversion ~~efforts~~formula.

26Unless ~~Table~~we are able to raise additional capital or begin to generate sufficient revenues to finance operations as a going concern, we may experience liquidity and solvency problems. Such liquidity and solvency problems may force us to cease operations if additional financing is not available. In addition to our burn rate and ongoing research and development expenses, we anticipate expending significant funds in connection with a contemplated two-plane test utilizing two Cessnas (or equivalent planes) installed with Infinitus technology incorporating the free space optic links (lasers) underlying the Company’s patent application filed on July 25, 2017 (which was denied), and a larger airborne test involving up to 20 commercial aircraft, assuming that sufficient progress has been made in the relevant software and hardware development and that we are able to obtain additional funding. In light of ~~Contents~~the issues we recently experienced in connection with integrating the manufactured lasers into Infinitus, as well not having enough cash on hand to fund our current operations, we are currently unable to predict when, or if, the two-plane test will occur.

~~Professional~~The ~~fees~~following ~~include~~table ~~fees~~sets toforth ~~consultants,~~certain ~~investor~~information ~~relations~~about ~~firms, and legal, accounting and compliance professionals for~~ our ~~audit,~~cash ~~SEC~~flows ~~filings,~~during ~~securities offerings and contracts. During~~ the ~~three~~nine months ended ~~February~~May 2831, 2019, professional fees were $393,000 compared to $1.1 million for the comparative period in 2018. The decrease in professional fees were mainly due to a decrease in consulting fees. We expect to continue to incur professional fees at this current level for the foreseeable future in connection with capital-raising transactions, regulatory compliance and ~~responses and other related matters.~~2018:

Research and development expenses incurred relate to the development of Infinitus starting in August 2016. During the three months ended February 28, 2019, we did not spend on research and development expense, as compared to $284,000 incurred during the same period in 2018. The decrease in our research and development spending during the three months ended February 28, 2019 was due to our lack of adequate capital resources to support our operations. Had the Company had access to greater capital resources, including cash on hand, during this period, the Company would have spent a greater amount on research and development. Until we obtain additional debt or equity financing, we will be unable to increase spending on research and development, and unable to prepare for our planned two-plane test and the eventual 20-plane test.

	Nine Months Ended
	May 31,
Cash Flow Data:	2019			2018			Changes

Cash Flows used in Operating Activities	$	(1,158,869	)	$	(11,258,176	)	$	10,099,307
Cash Flows used in Investing Activities		-			(19,731	)		19,731
Cash Flows provided by Financing Activities		1,014,395			15,179,361			(14,164,966	))
Net Change in Cash	$	(144,474	)	$	3,901,454		$	(4,045,928	)

~~General~~Cash ~~and~~Flows administrative expenses include office, shipping, entertainment, travel, insurance and other miscellaneous expenses. During the three months ended February 28, 2019, general and administrative expenses decreased primarily from ~~travel~~Operating ~~costs decreasing by $96,000 as compared to the same period in 2018.~~Activities

~~Our~~We ~~other~~have ~~(income)~~not ~~expense~~generated ~~for~~positive cash flows from operating activities. For the ~~three~~nine months ended ~~February~~May 2831, ~~2018~~2019, ~~and~~net ~~2017~~cash flows used in operating activities were $1,158,869, consisting of a net loss of $16.5 million, offset by stock-based compensation of $8.6 million, amortization of debt discount of $863,852, net loss on change in fair value of derivative liabilities of $854,224, depreciation of $9,372, and ~~the~~was ~~changes~~decreased ~~between~~from ~~those~~a ~~periods~~net ~~for~~change ~~the~~in ~~respective~~operation ~~items~~assets and liabilities of $5.0 million. Unless and until we generate revenue from Infinitus, ~~are~~we ~~summarized~~expect asto ~~follows:~~continue to generate net losses.

	Three Months Ended
	February 28,
Other Expense	2019		2018		Changes
Interest expense	$	348,721	$	581,304	$	(232,583	)
Change in fair value of derivative liabilities		1,060,845		2,006,888		(946,043	)
Total other expense	$	1,409,566	$	2,588,192	$	(1,178,626	)

Table of Contents

~~During~~For the ~~three~~nine months ended ~~February~~May 2831, ~~2019~~2018, ~~our~~net ~~Company~~cash ~~incurred~~flows ~~$1.4~~used ~~million~~ in ~~other~~operating ~~expense~~activities ~~which~~were ~~included~~$11.3 amillion, ~~loss~~consisting onof ~~change~~a innet ~~fair~~loss ~~value~~ of ~~derivative liabilities of~~ $154.5 million,~~060,845~~ ~~and~~offset ~~interest~~by ~~expense~~stock-based compensation of $~~348,721~~44.3 ~~The~~million, ~~loss~~net gain on change in fair value of derivative liabilities ~~related~~of to $~~125~~5.0 million,~~455~~ asamortization aof ~~day~~debt ~~one~~discount ~~loss~~of ~~from~~$4.6 ~~the~~million, ~~addition~~depreciation of ~~new~~$7,345 ~~derivative~~and ~~liabilities~~an ~~recognized~~increase ~~upon~~in ~~issuance~~operating ofliabilities ~~convertible~~from ~~preferred~~accounts ~~stock~~payable and aaccrued ~~loss~~liabilities of $~~935~~523,~~390~~504 inand ~~the~~accrued ~~change~~interest ~~in the fair value~~ of ~~derivative liabilities~~$182,093, as well ~~calculated~~as ~~using~~an ~~Black-Scholes~~increase ~~option~~in ~~model.~~operating ~~The~~assets ~~interest~~from ~~expense~~prepaid ~~includes~~expenses ~~amortization~~ of ~~debt~~$1.2 ~~discount~~million. Unless and ~~interest~~until ~~incurred~~we ongeneral ~~convertible~~revenue ~~notes~~from ~~during~~Infinitus, ~~the~~we ~~three~~expect ~~months~~to ~~ended~~continue ~~February~~to ~~28,~~generate ~~2019~~net losses.

~~During~~Cash ~~the~~Flows three months ended February 28, 2018, our company incurred $2.6 million in other expenses which include loss on change in fair value of derivative liabilities of $2 million and Interest expense of $581,304. The loss on change in fair value of derivative liabilities includes a day one loss in the fair value of warrants and convertible notes recorded as a derivative liability and from ~~the~~Investing change in the fair value of derivative liabilities, as calculated using Black-Scholes option model. The interest expense includes amortization of debt discount and interest incurred on convertible notes issued during the three months ended February 28, 2018. Activities

~~Liquidity~~For ~~and~~the ~~Capital~~nine ~~Resources~~months ended May 31, 2019, we did not have investing activities.

~~The~~For ~~following table presents selected financial information as of and for~~ the ~~six~~nine months ended ~~February~~May 2831, ~~2019~~2018, we acquired $19,731 of office and ~~2018:~~computer equipment.

	February 28,			August 31,
Balance Sheet Data:	2019			2018			Changes
Cash	$	11,761		$	155,988		$	(144,227	)
Working capital (deficiency)	$	(14,572,591	)	$	(9,271,865	)	$	(5,300,726	)
Total assets	$	70,056		$	1,210,248		$	(1,140,192	)
Total liabilities	$	14,614,285		$	10,447,503		$	4,166,782
Total stockholders' equity (deficit)	$	(14,544,229	)	$	(9,237,255	)	$	(5,306,974	)

Cash Flows from Financing Activities

27For ~~Table~~the nine months ended March 31, 2019, net cash flows provided by financing activities was $1,014,395, consisting of ~~Contents~~proceed from related party advances of $154,395 and Preferred Stock issued from the exercise of warrants of $910,000, and was offset by repayment of convertible notes of $50,000.

~~Because~~Cash we have not generated any revenues, we depend on proceeds from the sales of securities and loans to finance our operations. As previously disclosed, on May 29, 2018, we completed a public offering of 8,000 units consisting of 8,000 shares of our Series A Convertible Preferred Stock (the “Preferred Stock”) and 24,000 warrants to purchase additional shares of Preferred Stock from which we generated $6.7 million, after deducting underwriting discounts and other expenses of the offering. If all of the warrants included in the offering were exercised, then the Company could have received additional gross proceeds of up to $24 million, although there can be no assurance that the warrants will be exercised in full, or at all. During the six months ended February 28, 2019, we generated proceeds from Preferred Stock issued from the exercise of warrants of $890,000. 22,490 warrants remain unexercised as of February 29, 2019. The warrants have an expiration date of May 29, 2019.Requirements

OnWe ~~March~~will 4require additional cash as we expand our business. Initially, ~~2019~~to carry out our business plan, we ~~received~~will ~~gross~~need ~~proceeds~~to ofraise ~~$20~~additional capital. There can be no assurance that we will be able to raise additional capital or,~~000~~ ~~from~~if ~~the~~we ~~exercise~~are ofable 20to ~~warrants~~raise ~~issued~~additional incapital, ~~our~~the ~~May~~terms ~~2018~~we ~~public~~be ~~offering~~acceptable ~~into~~to 20us. ~~shares~~Currently ofwe ~~Preferred~~do ~~Stock~~not have any inventory.

~~Because~~These weconditions ~~currently~~indicate doa ~~not~~material ~~generate~~uncertainty ~~revenue,~~that wecasts ~~must~~significant ~~obtain~~doubt ~~additional~~about ~~financing~~our ability to continue ~~operations~~as ata ~~our~~going ~~current level~~concern. We ~~currently~~require doadditional ~~not~~debt ~~have~~or ~~enough~~equity ~~cash~~financing ~~on hand~~ to ~~fund~~have ~~our~~the ~~contemplated~~necessary ~~two-plane~~funding ~~test, and we are unable~~ to ~~predict~~continue ~~for~~operations ~~how~~and ~~long~~meet our ~~cash on hand will fund our current operations~~obligations. We ~~unsure~~have ~~that~~continued ~~we will be able~~ to ~~secure~~adopt ~~additional private and public financing in~~ the ~~future.~~going Weconcern ~~can~~basis ~~give no assurance that we can obtain any additional financing, or if such financing is available, that it would be available on terms generally as favorable as terms~~ of ~~recent~~accounting ~~financings. We believe our ability to secure such additional funding has been made more difficult by recent declines~~ in ~~the~~preparing ~~trading price of~~ our ~~common~~financial stock and the drastic increase in the number of shares outstanding resulting from conversions of the Preferred Stock by the holders thereof at conversation prices unfavorable to us due to the market-price-based nature of the conversation formulastatements.

Unless we are able to raise additional capital or begin to generate sufficient revenues to finance operations as a going concern, we may experience liquidity and solvency problems. Such liquidity and solvency problems may force us to cease operations if additional financing is not available. In addition to our burn rate and ongoing research and development expenses, we anticipate expending significant funds in connection with a contemplated twoOff-~~plane~~Balance ~~test~~Sheet utilizing two Cessnas (or equivalent planes) installed with Infinitus technology incorporating the free space optic links (lasers) underlying the Company’s patent application filed on July 25, 2017, and a larger airborne test involving up to 20 commercial aircraft, assuming that sufficient progress has been made in the relevant software and hardware development and that we are able to obtain additional funding. In light of the issues we recently experienced in connection with integrating the manufactured lasers into Infinitus, we are currently unable to predict when, or if, the two-plane test will occur.Arrangements

~~The~~Our ~~following~~company ~~table~~does ~~sets~~not ~~forth~~have ~~certain~~any ~~information~~off-balance ~~about~~sheet arrangements that have, or are reasonably likely to have, a current or future effect on our ~~cash~~company’s ~~flows~~financial ~~during~~condition, ~~the~~revenues ~~six~~or ~~months~~expenses, ~~ended~~results ~~February~~of 28operations, ~~2019~~liquidity, ~~and~~capital ~~2018:~~expenditures or capital resources that are material to investors.

	Six Months Ended
	February 28,
Cash Flow Data:	2019			2018			Changes
Cash Flows used in Operating Activities	$	(984,227	)	$	(6,576,645	)	$	5,592,418
Cash Flows used in Investing Activities		-			(15,759	)		15,759
Cash Flows provided by Financing Activities		840,000			6,579,873			(5,739,873	)
Net Change in Cash	$	(144,227	)	$	(12,531	)	$	(131,696	)

Application of Critical Accounting Policies

~~Cash~~We ~~Flows~~have ~~from~~identified ~~Operating~~the ~~Activities~~policies below as critical to our business operations and the understanding of our results of operations. The impact on our business operations and any associated risks related to these policies are discussed throughout Management’s Discussion and Analysis of Financial Condition and Results of Operations when such policies affect our reported or expected financial results.

WeIn the ordinary course of business, we have ~~not~~made ~~generated~~a ~~positive~~number ~~cash~~of ~~flows~~estimates ~~from~~and ~~operating~~assumptions ~~activities.~~relating ~~For~~to the ~~six~~reporting ~~months~~of ~~ended~~results ~~February~~of ~~28,~~operations ~~2019,~~and ~~net~~financial ~~cash~~condition ~~flows~~in ~~used~~the preparation of our financial statements in ~~operating~~conformity ~~activities~~with ~~were~~accounting ~~$984,227,~~principles ~~consisting~~generally ofaccepted ain ~~net~~the ~~loss~~United ofStates ~~$14~~(“GAAP”).4 ~~million,~~We ~~offset~~base byour ~~stock-based~~estimates ~~compensation~~on ofhistorical ~~$6.9~~experience ~~million,~~and ~~amortization~~on ofvarious ~~debt~~other ~~discount~~assumptions ofthat ~~$815,506,~~we ~~net~~believe ~~loss~~are onreasonable ~~change~~under inthe ~~fair~~circumstances. ~~value~~The ofresults ~~derivative~~form ~~liabilities~~the ofbasis ~~$825,953,~~for ~~depreciation~~making judgments about the carrying values of ~~$6,248,~~assets and ~~was~~liabilities ~~decreased~~that are not readily apparent from aother ~~net~~sources. ~~change~~Actual inresults ~~operation~~could ~~assets~~differ significantly from those estimates under different assumptions and ~~liabilities~~conditions. We believe that the following discussion addresses our most critical accounting policies, which are those that are most important to the portrayal of ~~$4.8~~our ~~million.~~financial ~~Unless~~condition and ~~until~~results weof ~~generate~~operations ~~revenue~~and ~~from~~require ~~Infinitus~~our most difficult, wesubjective, ~~expect~~and tocomplex ~~continue~~judgments, often as a result of the need to ~~generate~~make ~~net~~estimates ~~losses~~about the effect of matters that are inherently uncertain.

~~For~~27 ~~the~~Table ~~six months ended February 28, 2018, net cash flows used in operating activities were $6,576,645, consisting~~ of a net loss of $48,453,292, offset by stock-based compensation of $37,961,374, loss on change in fair value of derivative liabilities of $2,541,956, amortization of debt discount of $1,469,387, depreciation of $4,552 and an increase in operating liabilities from accounts payable and accrued liabilities of $270,561 and accrued interest of $92,521, as well as an increase in operating assets from prepaid expenses of $463,704. Unless and until we general revenue from Infinitus, we expect to continue to generate net losses. Contents

28The ~~Table~~material estimates for our Company are that of ~~Contents~~income tax valuation allowance recorded for deferred tax assets and stock-based compensation. We recorded stock-based compensation for options and warrants issued and the fair value of embedded conversion options that are convertible into a variable amount of shares. The fair values of options, warrants, and embedded conversion options are determined using the Black-Scholes option pricing model. We have no historical data on the accuracy of these estimates. The estimated sensitivity to change is related to the various variables of the Black-Scholes option pricing model stated below. The specific quantitative variables are included in the notes to the financial statements. The estimated fair value of options is recognized as expense on the straight-line basis over the options’ vesting periods. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option pricing model with the expected life, dividend yield, expected volatility, and risk-free interest rate weighted-average assumptions used for options and warrants granted. Expected volatility for 2019 and 2018 was estimated using our common stock for convertible notes and the average historical volatility of three public companies offering services similar to ours for warrants and stock options. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the grant date. The expected life of options is based on the life of the instrument on the grant date.

~~Cash~~Basis ~~Flows~~of ~~from~~Accounting ~~Investing~~and ~~Activities~~Going Concern

~~For~~Our unaudited condensed financial statements have been prepared on the ~~six~~accrual ~~months~~basis ~~ended~~of ~~February~~accounting ~~28,~~in ~~2019~~conformity with GAAP. In addition, the accompanying unaudited condensed financial statements have been prepared assuming that we ~~did~~will ~~not~~continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. We generated accumulated losses of approximately $130 million through May 31, 2019 and have ~~investing~~insufficient ~~activities~~working capital and cash flows to support operations. These factors raise substantial doubt about our ability to continue as a going concern. The unaudited condensed financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from this uncertainty.

~~For~~Research ~~the six months ended February 28, 2018, we acquired $15,759 of office~~ and ~~computer~~Development ~~equipment.~~Expenses

~~Cash~~We ~~Flows~~follow ~~from~~ASC ~~Financing~~730-10, ~~Activities~~”Research and Development,” and expense research and development costs when incurred. Accordingly, third-party research and development costs, including designing, prototyping and testing of product, are expensed when the contracted work has been performed or milestone results have been achieved. Indirect costs are allocated based on percentage usage related to the research and development. Research and development costs of $55,141 and $588,042 were incurred for the nine months ended May 31, 2019 and 2018, respectively.

~~For the six months ended February 28, 2019, net cash flows provided by financing activities was $840,000, consisting of proceeds from Preferred~~ Stock-Based ~~issued from the exercise of warrants of $890,000, and was offset by repayment of convertible notes of $50,000.~~Compensation

~~For~~ASC ~~the~~718, ~~six~~“Compensation ~~months~~- ~~ended~~Stock ~~February~~Compensation,” 28prescribes accounting and reporting standards for all share-based payment transactions in which employee services are acquired. Transactions include incurring liabilities, ~~2018~~or issuing or offering to issue shares, ~~net~~options ~~cash~~and ~~flows~~other ~~provided~~equity byinstruments ~~financing~~such ~~activities~~as ~~was~~employee $6stock ownership plans and stock appreciation rights. Share-based payments to employees,~~579,873,~~ ~~consisting~~including grants of ~~proceeds~~employee ~~from~~stock options, are recognized as compensation expense in the ~~issuance~~financial ofstatements ~~convertible~~based ~~notes~~on oftheir ~~$3,907,750~~fair ~~and~~values. ~~proceeds~~That ~~from~~expense is recognized over the ~~issuance~~period ofduring ~~common~~which ~~stock~~an ~~from~~employee ~~share~~is ~~subscriptions~~required ofto ~~$1,079,999~~provide ~~and~~services ~~exercises~~in ofexchange ~~warrants~~for ofthe $1award,~~592,124~~ known as the requisite service period (usually the vesting period).

~~Off~~Our ~~Balance~~Company ~~Sheet~~accounts ~~Arrangements~~for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, “Equity - Based Payments to Non-Employees.” Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

~~Our company does not have any off~~Stock-~~balance~~based ~~sheet~~compensation ~~arrangements~~of ~~that have~~$8,563,096 orand ~~are reasonably likely to have~~$44,278,826 awere ~~current~~incurred orfor ~~future~~the ~~effect~~nine onmonths ~~our~~ended ~~company’s~~May ~~financial condition~~31, ~~revenues~~2019 orand ~~expenses~~2018, ~~results of operations, liquidity, capital expenditures or capital resources that are material to investors~~respectively.

~~Application~~28 Table of ~~Critical Accounting Policies~~Contents

WeRecent ~~have~~accounting identified the policies below as critical to our business operations and the understanding of our results of operations. The impact on our business operations and any associated risks related to these policies are discussed throughout Management’s Discussion and Analysis of Financial Condition and Results of Operations when such policies affect our reported or expected financial results.pronouncements

InManagement ~~the~~has ~~ordinary~~considered ~~course~~all ofrecent business, we have made a number of estimates and assumptions relating to the reporting of results of operations and financial condition in the preparation of our financial statements in conformity with accounting ~~principles~~pronouncements ~~generally accepted in the United States (“GAAP”)~~issued. WeManagement ~~base~~believes ~~our estimates on historical experience and on various other assumptions~~ that wethese ~~believe~~recent ~~are~~pronouncements ~~reasonable~~will ~~under the circumstances. The results form the basis for making judgments about the carrying values of assets and liabilities that are~~ not ~~readily~~have ~~apparent~~a ~~from~~material ~~other~~effect ~~sources.~~on ~~Actual results could differ significantly from those estimates under different assumptions and conditions. We believe that the following discussion addresses~~ our ~~most~~Company’s ~~critical accounting policies, which are those that are most important to the portrayal of our~~ financial condition and results of operations and require our most difficult, subjective, and complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertainstatements.

The material estimates for our Company are that of income tax valuation allowance recorded for deferred tax assets and stock-based compensation. We recorded stock-based compensation for options and warrants issued and the fair value of embedded conversion options that are convertible into a variable amount of shares. The fair values of options, warrants, and embedded conversion options are determined using the Black-Scholes option pricing model. We have no historical data on the accuracy of these estimates. The estimated sensitivity to change is related to the various variables of the Black-Scholes option pricing model stated below. The specific quantitative variables are included in the notes to the financial statements. The estimated fair value of options is recognized as expense on the straight-line basis over the options’ vesting periods. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option pricing model with the expected life, dividend yield, expected volatility, and risk-free interest rate weighted-average assumptions used for options and warrants granted. Expected volatility for 2019 and 2018 was estimated using our common stock for convertible notes and the average historical volatility of three public companies offering services similar to ours for warrants and stock options. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the grant date. The expected life of options is based on the life of the instrument on the grant date.

29 Table of Contents

Basis of Accounting and Going Concern

Our unaudited condensed financial statements have been prepared on the accrual basis of accounting in conformity with GAAP. In addition, the accompanying unaudited condensed financial statements have been prepared assuming that we will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. We generated accumulated losses of approximately $128 million through February 28, 2019 and have insufficient working capital and cash flows to support operations. These factors raise substantial doubt about our ability to continue as a going concern. The unaudited condensed financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from this uncertainty.

Research and Development Expenses

We follow ASC 730-10, ”Research and Development,” and expense research and development costs when incurred. Accordingly, third-party research and development costs, including designing, prototyping and testing of product, are expensed when the contracted work has been performed or milestone results have been achieved. Indirect costs are allocated based on percentage usage related to the research and development. Research and development costs of $55,141 and $569,942 were incurred for the six months ended February 28, 2019 and 2018, respectively.

Stock-Based Compensation

ASC 718, “Compensation - Stock Compensation,” prescribes accounting and reporting standards for all share-based payment transactions in which employee services are acquired. Transactions include incurring liabilities, or issuing or offering to issue shares, options and other equity instruments such as employee stock ownership plans and stock appreciation rights. Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).

Our Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, “Equity - Based Payments to Non-Employees.” Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

Stock-based compensation of $6,938,708 and $37,961,374 were incurred for the three months ended February 28, 2019 and 2018, respectively.

Recent accounting pronouncements

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

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not required for smaller reporting companies.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods prescribed by the SEC’s rules and forms and that such information required to be disclosed by us in reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer as appropriate to allow timely decisions regarding required disclosure. Management, with the participation of our Chief Executive Officer and Chief Financial Officer, performed an evaluation of the effectiveness of our disclosure controls and procedures as of ~~February~~May 2831, 2019. Based on that evaluation, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that, as a result of the previously reported material weaknesses in our internal control over financial reporting described below, our disclosure controls and procedures were not effective as of ~~February~~May 2831, 2019.

30 Table of Contents

Material Weaknesses in Internal Control Over Financial Reporting and Remediation Measures

As previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2018, management identified the following material weaknesses in our internal control over financial reporting:

(1)	Management override of controls;

(2)	absent or inadequate segregation of duties within a significant account or process;

(3)	inadequate design of monitoring controls used to assess the design and operating effectiveness of the entity’s internal control over time.

The Company continues to work on remediation measures for the above weaknesses. However, the material weaknesses will not be considered fully remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively. We are committed to continuing to improve our internal control processes and will continue to diligently and vigorously review our financial reporting controls and procedures. As management continues to evaluate and work to improve internal control over financial reporting, the Company may decide to take additional measures to address control deficiencies or decide to modify, or in appropriate circumstances not to complete, certain of the remediation measures described above.

Changes in Internal Control Over Financial Reporting

Except as related to the material weaknesses and remedial measures described above, there have been no changes in the Company’s internal control over financial reporting that occurred during the fiscal quarter ended ~~February~~May 2831, 2019 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we may become involved in various legal proceedings that arise in the ordinary course of business, including actions related to our intellectual property. Although the outcomes of these legal proceedings cannot be predicted with certainty, Management believes that the ultimate outcomes of the pending significant legal proceedings to which the Company is a party may have a material effect on our business, financial condition or results of operations.

On January 2, 2018, the Company, J. Edward Daniels, the Company’s transfer agent and certain other individuals were named as defendants in a lawsuit filed in the United States District Court - Central District of California captioned The Alliance for Education, Inc. v. Airborne Wireless Network, Inc. et al., Case No. 2:18-cv-20. The second amended complaint makes conversion claims against the Company and Mr. Daniels, and a breach of fiduciary duty claim against Mr. Daniels, alleging that the defendants wrongfully deprived the plaintiff of certain stock certificates representing shares of the Company’s common stock, and seeks monetary and punitive damages, a judicial declaration regarding the ownership of the share certificates at issue, an injunction that the certificates at issue be returned or reissued to the plaintiff and costs and attorneys’ fees. The outcome of this lawsuit is uncertain. The Company believes that the claims asserted are without merit. On April 11, 2019, the parties entered into a Confidential Settlement Agreement and Release. On June 24, 2019, the Court dismissed the action.

On October 17, 2018, GT Legal Corp., as assignee of Troy Gould PC, the Company’s corporate counsel prior to August 2017, filed a complaint against the Company in the Superior Court of California County of Los Angeles, Case No.: 18STCV01578, for breach of contract for unpaid legal fees. Troy Gould PC is seeking $71,960.50 in unpaid legal fees plus daily interest of $19.72 per day. On February 13, 2019, the Company and GT Legal Corp. entered into a Confidential Settlement Agreement and Release. The Company believes that the claims asserted were without merit. On May 28, 2019, GT Legal Corp. filed a Request for Dismissal with Prejudice.

On November 15, 2018, the Company was named as a defendant in Neutron Media, Inc. v. Airborne Wireless Network, in a complaint filed in the Superior Court of Ventura County, California, Case No.: 56-2018-00520023-CU-CL-VTA. Neutron Media, Inc., the plaintiff, seeks money damages in connection with the alleged breach by the Company of an advertising package contract. The contract at issue provides that in exchange for payment, the plaintiff would provide the Company a 30-second spot looping a minimum of three times per hour, for a total of 90 seconds per hour, airing 20 hours per day, from 6:00 am to 2:00 am, over an 89-day period, on The 1500 Broadway Spectacular, a 56 foot-by-29 foot viewing space. Neutron Media, Inc. alleges that it performed all conditions of the contract, but that the Company had breached the agreement by failing to provide payment. On March 8, 2019, a Request for Dismissal was filed by the plaintiff with the Ventura Superior Court and the complaint was dismissed without prejudice. The Company believes that the claims asserted were without merit.

32On ~~Table~~February 6, 2019, the Company was named as a defendant in YA II PN, LTD. v. Airborne Wireless Network, in a complaint filed in the Superior Court of ~~Contents~~New Jersey, Hudson County, Docket No.: HUD-L-00-557-19. YA II PN, LTD., the plaintiff, seeks monetary damages for the alleged breach of a debenture issued by the Company to YA II PN, LTD. in the amount of $1,264,964 plus interest, fees and costs including attorney’s fees. The debenture was issued by the Plaintiff in the amount of $1,250,000 on or about April 9, 2018. On March 21, 2019, the Plaintiff filed a request for Entry of Default Judgment in the amount of $1,284,542. On March 26, 2019, YA II PN obtained a Final Judgement against the Company in the amount of $1,284,542, which is included in the outstanding principal balance of the convertible note of $1,190,000 and accrued note interest of $111,364 as of May 31, 2019. The Company is currently evaluating its options and alternative ways to satisfy it.

On February 6, 2019, the Company was named as a defendant in YA II PN, LTD. v. Airborne Wireless Network, in a complaint filed in the Superior Court of New Jersey, Hudson County, Docket No.: HUD-L-00-557-19. YA II PN, LTD., the plaintiff, seeks monetary damages for the alleged breach of a debenture issued by the Company to YA II PN, LTD. in the amount of $1,264,964 plus interest, fees and costs including attorney’s fees. The debenture was issued by the Plaintiff in the amount of $1,250,000 on or about April 9, 2018. On March 21, 2019, the Plaintiff filed a request for Entry of Default Judgment in the amount of $1,284,542. On March 26, 2019, YA II PN obtained a Final Judgement against the Company in the amount of $1,284,542.

Item 1A. Risk Factors

Not required for smaller reporting companies.

Table of Contents

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

During the ~~three~~nine months ended ~~February~~May 2831, 2019, the Company ~~did~~issued ~~not~~4,526,591,644 ~~have~~shares ~~unregistered sales~~ of common ~~equity.~~stock, as follows:

	·	71,284,919 shares of common stock to strategic service providers, for services valued at $20,655.

	·	4,197,761,961 shares of common stock issued for the conversion of 861 shares of Series A Convertible Preferred Stock.

	·	257,544,764 shares of common stock issued upon the conversion of convertible notes in aggregate principal amount of $34,075 and accrued interest of $13,112.

In addition, during the nine months ended May 31, 2019, 200 Series 2 warrants were exercised into 200 shares of Series A Convertible Preferred Stock and 710 Series 3 warrants were exercised into 710 shares of Series A Convertible Preferred Stock for an aggregate net proceeds of $910,000.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not Applicable.

Item 5. Other Information

None.

3331 Table of Contents

Item 6. Exhibits

Exhibit		~~INCORPORATED~~INCORPORATEDBY BY REFERENCE
Number	Exhibit Description	Form	Exhibit	Filing Date
3.1	Amended and Restated Articles of Incorporation, effective as of July 31, 2017	8-K	3.1	08/01/2017
3.2	Certificate of Amendment to Articles of Incorporation, filed June 18, 2018	8-K	3.1	06/20/2018
3.3	Certificate of Amendment to Articles of Incorporation, filed June 28, 2018	8-K	3.1	06/29/2018
3.4	Certificate of Change, filed August 22, 2018	8-K	3.1	08/24/2018
3.5	Certificate of Designation for Series A Convertible Preferred Stock	8-K	3.1	05/29/2018
3.6	Amended and Restated Bylaws effective as of July 30, 2017	8-K	3.2	08/01/2017
10.1	Exercise Agreement, dated as of October 17, 2018, between Airborne Wireless Network and Sabby Volatility Warrant Master Fund, Ltd.	8-K	10.1	10/17/2018
10.2	Exercise Agreement, dated as of October 17, 2018, between Airborne Wireless Network and Ionic Ventures LLC	8-K	10.2	10/17/2018
10.3	Lock-up Agreement, dated as of October 17, 2018, between Airborne Wireless Network and Sabby Volatility Warrant Master Fund, Ltd.	8-K	10.3	10/17/2018
10.4	Lock-up Agreement, dated as of October 17, 2018, between Airborne Wireless Network and Ionic Ventures LLC	8-K	10.4	10/17/2018
10.5	Lock-up Agreement, dated as of October 17, 2018, between Airborne Wireless Network and Anson Funds Management LP	8-K	10.5	10/17/2018
10.6	Lock-up Agreement, dated as of October 17, 2018, between Airborne Wireless Network and Hudson Bay Master Fund Ltd.	8-K	10.6	10/17/2018
10.7	Lock-up Agreement, dated as of October 17, 2018, between Airborne Wireless Network and YA II PN, Ltd.	8-K	10.7	10/17/2018
10.8	Exercise Agreement, dated as of December 17, 2018, between Airborne Wireless Network and Sabby Volatility Warrant Master Fund, Ltd.	8-K	10.1	12/18/2018
10.9	Lock-up Agreement, dated as of December 12, 2018, between Airborne Wireless Network and Anson Funds Management LP	8-K	10.2	12/18/2018
10.10	Lock-up Agreement, dated as of December 12, 2018, between Airborne Wireless Network and Hudson Bay Master Fund Ltd.	8-K	10.3	12/18/2018
10.11	Lock-up Agreement, dated as of December 12, 2018, between Airborne Wireless Network and Ionic Ventures LLC	8-K	10.4	12/18/2018
10.12	Lock-up Agreement, dated as of December 13, 2018, between Airborne Wireless Network and YA II PN, Ltd.	8-K	10.5	12/18/2018
31.1*	Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer
31.2*	Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer
32.1*	Section 1350 Certification of Chief Executive Officer
32.2*	Section 1350 Certification of Chief Financial Officer
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document

~~_________~~______

* Filed herewith.

† Management contract or plan.

3432 Table of Contents

SIGNATURES

Pursuant to the requirements 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.

	~~AIRBORNE WIRELESS NETWORK~~	AIRBORNE WIRELESS NETWORK
Dated: April 9, 2019	By:	/s/ Michael J. Warren
		(Registrant)
Dated: July 10, 2019		/s/ Michael J. Warren
		Michael J. Warren
		Chief Executive Officer
		(Principal Executive Officer)
Dated: April 9, 2019	By:	/s/ Kevin L. Spence
Dated: July 10, 2019		/s/ Kevin L. Spence
		Kevin L. Spence
		Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

3533

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