UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[ X ] Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended April 30, 2011

[   ] Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from __________ to __________

Commission file number 000-53799

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

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

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

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.

Yes [ X ] No [   ]

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

Yes [   ] No [   ] (Not applicable)

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

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

Yes [   ] No [ X ]

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: 78,350,217 common shares issued and outstanding as of June 14, 2011.

INDEX

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PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

While the information presented in the accompanying interim condensed consolidated financial statements for the quarter ended April 30, 2011 is unaudited, it includes all adjustments which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows for the interim period. These interim condensed consolidated financial statements follow the same accounting policies and methods of their application as our October 31, 2010 annual audited condensed consolidated financial statements. All adjustments are of a normal recurring nature. It is suggested that these interim condensed financial statements be read in conjunction with our October 31, 2010 annual audited consolidated financial statements.

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See Accompanying Notes to Consolidated Financial Statements

4

See Accompanying Notes to Condensed Consolidated Financial Statements

5

See Accompanying Notes to Condensed Consolidated Financial Statements

6

See Accompanying Notes to Consolidated Financial Statements

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Notes to Condensed Consolidated Financial Statements
For the Six Months Ended April 30, 2011 and 2010
(Unaudited)

Nexaira Wireless Inc. (“the Company”), formerly known as Technology Publishing, Inc. (“TPI”) was incorporated in the State of Nevada on March 19, 2007. The Company is headquartered in Vancouver, British Columbia Canada and its principal operations are located in San Diego, California. The Company develops and distributes 3G/4G wireless broadband routing solutions, as well as communications software to wireline and wireless carriers, Managed Service Providers (MSPs), Value Added Resellers (VARs) and distributors. The Company also provides customization services, marketing tools, provision and airtime activations based on individual customer needs. The Company is publicly traded on the Over-the-Counter Bulletin Board (OTCBB) under the symbol “NXWI” and can be found on the worldwide web at www.nexaira.com.

The accompanying interim condensed consolidated financial statements are unaudited, but in the opinion of management, contain all adjustments, which include normal recurring adjustments, necessary to present fairly the financial position as of April 30, 2011, and the results of operations and cash flows for the six months ended April 30, 2011 and 2010. The balance sheet as of October 31, 2010 is derived from the Company’s audited financial statements. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes thereto incorporated by reference in the Company's Annual Report on Form 10-K for the year ended October 31, 2010.

Certain information and footnote disclosures normally included in financial statements that have been prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission, although management of the Company believes that the disclosures contained in these financial statements are adequate to make the information presented therein not misleading. For further information, refer to the financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2010, as filed with the Securities and Exchange Commission.

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

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

The accompanying consolidated financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. The accompanying consolidated financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern. The Company has experienced a decline in revenues, and has negative cash flows from operations, negative working capital and capital deficits, which raise substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern and appropriateness of using the going concern basis is dependent upon, among other things, an additional cash infusion.

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Ongoing unfavorable economic conditions worldwide have led to a low level of liquidity in many financial markets and extreme volatility in the credit and equity markets available to the Company. The Company has obtained funds from both related and unrelated parties since its inception. Management believes this funding will continue, and is actively seeking new investors. Management believes the existing shareholders and prospective new investors will provide the additional cash needed to meet the Company’s obligations as they become due, and will allow the development of its core business. The Company has plans to raise up to $5 million by the third quarter of fiscal 2011 through equity and favorable debt financing.

If signs of improvement in the global economy do not progress as expected and the economic slowdown continues or worsens, the Company’s business, financial condition, cash flows and results of operations will be adversely affected. If that happens, the Company’s ability to access the capital or credit markets may worsen and it may not be able to obtain sufficient capital to satisfy or refinance all of its outstanding debt obligations as the obligations are required to be paid. If the Company is unable to achieve projected operating results and/or obtain the additional contemplated financing, management will be required to curtail growth plans and reduce development activities. The Company will be required to consider strategic and other alternatives, including, among other things, the sale of assets to generate funds, the negotiation of revised terms of its indebtedness, additional exchanges of its existing indebtedness obligations for new securities and additional equity offerings. The Company has retained financial advisors to assist it in considering these strategic, restructuring or other alternatives. There is no assurance that the Company will be successful in completing any of these alternatives. The Company’s failure to satisfy or refinance any of its indebtedness obligations as they come due, including through additional exchanges of new securities for existing indebtedness obligations or additional equity offerings, will result in a default and potential acceleration of its remaining indebtedness obligations and will have a material adverse effect on its business and continuance as a going concern.

Revenue Recognition

The Company’s revenues comprise of the following:

• distribution of third party mobile wireless broadband, modules and router solutions, as well as related accessories;

• the Company’s proprietary wireless router solutions that are integrated with the Company’s internally developed software that is essential to the functionality of the equipment; and

• customization services, marketing tools, provisioning and airtime activations based on individual customer needs.

The Company recognizes revenue, net of sales tax, in accordance with ASC 605-10, Revenue Recognition, when all four basic criteria are met: 1) there is evidence that an arrangement exists; 2) delivery has occurred; 3) the fee is fixed or determinable; and 4) collectability is reasonably assured. In addition, the Company does not recognize revenue until all customers’ acceptance criteria have been met. The criteria are usually met at the time of product shipment, except for shipments to distributors with rights of return. The portion of revenue from shipments to distributors subject to rights of return is deferred until the agreed upon percentage of return or cancellation privileges lapse. The Company considered ASC 985-605, Software Revenue Recognition applied to the revenue recognition of the Company’s newly developed products sold during the six months ended April 30, 2011 and 2010. The Company does not currently sell its proprietary router product and internally developed software separately, and no services are provided after the product is shipped. Therefore, normal ASC 605-10 revenue recognition guidance applies as noted above.

Computation of Income and Loss per Share

The Company computes income and loss per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the statements of operations. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive.

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Derivative Financial Instruments

The Company accounts for derivative instruments in accordance with the provisions of ASC 815-10, Derivatives Hedging, and its related literature. ASC 815-10 establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts and for hedging activities.

The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risk. Terms of convertible debt and equity instruments are reviewed to determine whether or not they contain embedded derivatives that are required under ASC 815-10 to be accounted for separated from the host contract, and recorded on the balance sheet at fair value. The fair value of derivative liabilities is required to be revalued at each reporting date, with the corresponding changes in fair value recorded in current period operating results.

Fair Value of Financial Instruments

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

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

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

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

As defined by ASC 820-10, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale, which was further clarified as the price that would be received to sell an asset or paid to transfer a liability (“an exit price”) in an orderly transaction between market participants at the measurement date.

The reported fair values for financial instruments that use Level 2 and Level 3 inputs to determine fair value are based on a variety of factors and assumptions. Accordingly, certain fair values may not represent actual values of the Company’s financial instruments that could have been realized as of April 30, 2011 or that will be recognized in the future and do not include expenses that could be incurred in an actual settlement. The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, prepaids and other current assets, and other assets, accounts payable, accrued expenses, accrued interest, taxes payable, and other current liabilities, approximate their fair values because of the short maturity of these instruments. The Company’s notes payable to shareholders, long-term debt, and convertible note approximates the fair value of such instrument based upon management’s best estimate of interest rates that would be available to the Company for similar financial arrangements at April 30, 2011 and October 31, 2010. The Company’s embedded derivative liability measured at fair value on a recurring basis was determined using the following inputs:

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The fair value of the embedded derivative related to the issuance of the convertible note payable as of April 30, 2011 was $159,224. The Company’s stock price was $0.08, risk-free discount rate of 4.15% and volatility of 125% was used to obtain fair value, resulting in the change in fair value of $12,568 recorded as other income in the Company’s Consolidated Statements of Operations for the six months ended April 30, 2011.

The fair value of the derivative related to the price protection of warrants in connection with the issuance of common stock in a private placement as of April 30, 2011 was $126,021. The Company’s stock price was $0.08, risk-free discount rate of 1.01% and volatility of 125% was used to obtain fair value, resulting in the change in fair value of $37,787 recorded as other income in the Company’s Consolidated Statements of Operations for the six months ended April 30, 2011.

A reconciliation of the Company’s liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows:

Concentration of Credit Risk

The Company provides products and services to a variety of customers worldwide. Concentration of credit risk with respect to revenues and trade receivables is limited due to the geographic and industry dispersion of the Company’s customer base. The Company has not experienced significant credit losses on its customer accounts. A small number of customers has typically accounted for a large percentage of the Company’s annual revenues and trade accounts receivable. For the three months ended April 30, 2011, three customers accounted for 21%, 18% and 12% respectively, of the Company’s revenues. Two customers accounted for 30%, and 10%, respectively, of the Company’s revenues for the six months ended April 30, 2011. For the three months ended April 30, 2010, three customers accounted for 42%, 16% and 10%, respectively and three customers accounted for 40%, 15% and 11%, respectively, of the Company’s revenues for the six months ended April 30, 2010.

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Three customers accounted for19%, 17% and 10%, respectively, of trade accounts receivable as of April 30, 2011. As of April 30, 2010, two customers accounted for 40% and 17% of outstanding trade accounts receivable.

The Company relied on two suppliers to provide 89% of total inventory purchases for the three months ended April 30, 2011. For the Six months ended April 30, 2011, the Company relied on inventory purchases of 11%, 18% and 62% from three suppliers, respectively. The Company relied on one supplier to provide 82% of total inventory purchases for the three and six months ended April 30, 2010, respectively.

Research and Development Costs

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

Software Development Costs

The Company capitalizes software development costs in accordance with ASC 985-20, Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed. Software development costs consist of labor and overhead costs related to development of the Company’s suite of NexWare™ firmware for the Company’s suite of wireless routers. Software development costs are capitalized when technological feasibility and marketability of the related product has been established. On June 1, 2008, the Company established technological feasibility upon successful completion and testing of the Company’s first working router product pilot firmware program. Capitalized software costs are amortized on a product-by-product basis over five years, beginning when the product is available for general release to customers. As of April 30, 2011, software development costs in the amount of $837,230 includes $109,374 related to the development of NexWare™ Enterprise Pro product expected to be released in the second half of 2011. Accordingly, amortization has not begun on NexWare™ Enterprise Pro to date.

Intangible Assets

Intangible assets, consisting principally of patents and trademarks, are accounted for in accordance with ASC 350.30, Goodwill and Other Intangibles. Intangible assets that have finite lives are amortized using the straight-line method over their estimated useful lives of fifteen years. Amortization expense for the three months and six months ended April 30, 2011 was $6,153 and $12,313, respectively. Amortization expense for the three months and six months ended April 30, 2010 was $4,858 and $9,188, respectively.

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Depreciation expense for the three and six months ended April 30, 2011 totalled $33,329 and $66,979, respectively. For the three and six months ended April 30, 2010, depreciation expense $28,893 and $59,995, respectively.

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

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

As of April 30, 2011, shares reserved for the exercise of warrants totaled 12,062,723 and 15,000,000 shares are reserved for issuance upon the exercise of options granted under the Company’s Stock Option Plan, of which 9,672,917 are outstanding. In addition, 116,670 shares are reserved in connection with a consulting agreement entered into on March 22, 2010, and 1,000,000 shares are reserved for the convertible note payable agreement entered into on August 20, 2010. On February 25, 2011, the lender delivered a notice of conversion with respect to $10,000 of the principal amount of the note into 142,030 common shares and on March 22, 2011, the lender converted $20,000 of the principal amount of the note into 289,665 common shares. These were excluded from the calculation of diluted earnings per share as their effect was anti-dilutive.

As of April 30, 2010, shares reserved for conversion of the convertible debenture, and the exercise of warrants to purchase common stock totaled 0 and 16,129,064, respectively. 1,129,034 shares are reserved for issuance upon the exercise of stock options granted to a lender and 15,000,000 shares are reserved for issuance upon the exercise of options granted under the Company’s Stock Option Plan, of which 10,193,750 have been granted. These were excluded from the calculation of diluted earnings per share as their effect was anti-dilutive.

On January 13, 2011, the Company entered into a Debt Settlement and Subscription Agreement with a vendor. Under the terms of the agreement, the Company issued to the vendor 1,500,000 and 2,357,406 shares of common stock of the Company at a price of $0.10 and $0.20 per share, respectively, as full settlement of $150,000 and $471,481, respectively, of the outstanding debt and accrued interest thereon as of January 13, 2011. The Company recorded a gain on the settlement of this note payable of $231,016, which is included in gain on settlement of note payable and accounts payable in the Company’s Condensed Consolidated Statements of Operations.6

On August 20, 2010, the Company entered into a 10% Convertible Note Agreement with an investor for total proceeds of $400,000, less $8,500 debt issuance fees which is amortized over twelve months to July 31, 2011. The Convertible Note Agreement bears interest at 10% per annum and matures July 31, 2011. The note holder has the option after six months following the issuance date to convert the outstanding principal amount under the Convertible Note Agreement, together with unpaid interest thereon, into the Company’s common stock at a conversion price equal to the lesser of (i) $0.50 and (ii) 80% of the average of the three lowest daily dollar volume-weighted average sale price (“VWAPS”) for the Company’s common stock on any particular trading day during the twenty (20) consecutive trading days immediately preceding the applicable conversion date on which the Holder elects to convert all or part of the note. Total amortization expense in connection with the debt issuance costs for the six months ended April 30, 2011 is $4,447 and is included in interest and other expense in the Company’s Condensed Consolidated Statements of Operations.

The Company determined that the VWAP contained certain price protection features and constituted an embedded derivative. Using the Monte Carlo Valuation Model, the fair value of the embedded derivative at April 30, 2011 was determined to be $159,223. The Company’s stock price on April 30, 2011 was $0.08, risk-free discount rate of 4.15% and volatility of 125% was used to obtain fair value as of April 30, 2011, resulting in the decrease in fair value for the three month period ended April 30, 2011 of $12,568 which was offset by an increase in the fair value of $17,177 for the three month period ended January 31, 2011 for a net increase of $4,609 which was recorded as other expense in the Company’s Condensed Consolidated Statements of Operations for the six months ended April 30, 2011. Accretion of the debt discount associated with the embedded derivative totaled $72,951 for the six months ended April 30, 2011 and is included in interest and other expense in the Company’s Condensed Consolidated Statements of Operations.

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Under the scope of ASC 815-10, the freestanding detachable warrants issued in connection with the issuance of the debt instrument are not considered to be derivative instruments. Under the Black-Scholes model, the Company determined the fair value of the warrants is $49,458, which is recorded as debt discount and to be accreted to interest expense over twelve months to July 31, 2011. Accretion of the debt discount associated with the warrants totaled $25,873 for the six months ended April 30, 2011 and is included in interest and other expense in the Company’s Condensed Consolidated Statements of Operations.

On February 25, 2011, the note holder executed a Form of Conversion Notice for conversion of $10,000, plus accrued interest thereon totaling $518, into 142,030 shares of common stock of the Company. On March 24, 2011, the note holder converted $20,000, plus accrued interest thereon totaling $21,172.60, into 289,665 shares of common stock.

On March 21, 2011, the Company entered into an amendment with the lender to extend the maturity date of the note payable from July 31, 2011 to October 31, 2011. In exchange for the extension, the Company issued a three-year warrant to purchase 333,333 shares of common stock with an exercise price of $0.15 per share. Using the Black-Scholes model, the Company determined the fair value of the warrants is $27,762, which is recorded as interest expense in the period in the Company’s Condensed Consolidated Statements of Operations.

Non-brokered Private Placements

On December 17, 2010, the Company closed a private placement of 8,600,000 shares of common stock at a purchase price of $0.10 per share for aggregate proceeds of $860,000. The Company issued 3,000,000 shares to two non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933, as amended (the “Act”) and 5,600,000 shares to nine U.S. persons pursuant to Rule 506 of Regulation D and/or Section 4(2).

Additionally, 1,400,000 warrants were issued as a placement fee and for ongoing investment banking and other financial advisory services to three U.S. persons pursuant to Rule 506 of Regulation D and/or Section 4(2). The warrants are exercisable at a strike price equal to US$0.28 per share until November 18, 2013.

On March 23, 2011, the Company closed a private placement consisting of 2,250,000 units at a purchase price of $0.10 per unit for aggregate gross proceeds of $225,000. Each Unit consists of one common share in the capital of the Company and one common share purchase warrant exercisable at a strike price of $0.15 per share at any time until March 23, 2014. The 2,250,000 units were issued to four U.S. persons pursuant to Rule 506 of Regulation D and/or Section 4(2).

The Company determined that the adjustment feature within the warrants require the Company to grant additional warrants to each warrant holder in the case that any future grants by the Company have an exercise price below $0.15 constituted a derivative. Using the Monte Carlo Valuation Model, the fair value of the derivative was determined to be $163,080 at the March 23, 2011 issuance date. At April 30, 201, the value was determined to be $126,020. The Company’s stock price on April 30, 2011 was $0.08, risk-free discount rate of 1.01% and volatility of 125% was used to obtain fair value as of April 30, 2011, resulting in the decrease in fair value of $37,787 recorded as other income in the Company’s Condensed Consolidated Statements of Operations for the six months ended April 30, 2011.

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Short Term Note Payable

On February 2, 2011, the Company entered into short-term promissory note agreement in the amount of $263,075 with an unrelated party, for working capital purposes. The promissory note agreement is due on demand and bears interest at 12% per annum.

Convertible Note Payable

On February 25, 2011, a convertible note holder delivered a notice of conversion with respect to $10,000 of the principal amount of a note, dated August 20, 2010, in the principal amount of $400,000 issued by the company to the note holder. Effective February 25, 2011, the $10,000, and $518 accrued interest thereon, were converted into 142,030 common shares of the Company’s stock at a conversion price of $0.074053 per share.

On March 22, 2011, the convertible note holder delivered a notice of conversion with respect to $20,000 of the principal amount of the note, dated August 20, 2010. Effective March 23, 2011, the $20,000, and $1,172.60 accrued interest thereon, were converted into 289,665 common shares of the Company’s stock at a conversion price of $0.0731 per share. See Note 9 – Convertible Note Payable.

Conversion of Short-Term Promissory Note Payable

On February 25, 2011, the Company entered into a debt settlement and subscription agreement with one investor whereby the Company agreed to issue 2,500,000 shares of the Company’s common stock in settlement of $250,000 of a $300,000 short-term promissory notes payable owing by us to the investor. The shares were issued at a price of $0.10 per share. On February 25, 2010 the Company issued the investor a note in the principal amount of $77,321with respect to the remaining principal plus interest payable on the debt as of that date.

Consulting Agreements

On February 24, 2011, the Company entered into a letter agreement with a financial advisor, whereby the advisor agreed to provide certain advisory services to the Company in consideration for the issuance of up to 1,800,000 shares of restricted common stock at a price of $0.10 per share, with the shares to be issued as follows: (a) 450,000 shares upon execution of the letter agreement; and (b) 150,000 shares at the end of each month starting on the last day of the fourth month through the twelfth month of the term of the agreement.

Also, on February 24, 2011, the Company entered into a consulting agreement , whereby the consultant has agreed to provide certain consulting services to the Company in consideration for the issuance of up to 1,800,000 shares of restricted common stock at a price of $0.10 per share, to be issued as follows: (a) 450,000 shares upon execution of the consulting agreement; and (b) 150,000 shares at the beginning of each month starting on the last day of the fourth month through the twelfth month of the term of the agreement.

On March 2, 2011, in connection with the entry into the letter agreements with the financial advisor and the consultant as described above, the Company issued an aggregate of 900,000 shares of common stock to four U.S. persons.

On April 18, 2011, the Company entered into a letter agreement with a financial consultant, whereby the consultant agreed to provide certain advisory services to the Company in consideration for a $10,000 monthly retainer and the issuance of 500,000 options to purchase shares of common stock at a price of $0.15 per share, with the shares to vest over 18 months. The fair value of the options earned as of April 30, 2011 was approximately $1,000. The remaining unvested and unearned options will be valued each reporting period in accordance with ASC 505 and recorded and compensation expense.

Shares Reserved for Future Issuance

The Company is required to reserve and keep available of its authorized, but unissued shares of common stock an amount sufficient to effect the conversion of the outstanding Convertible Note Payable, warrants, plus shares granted and available for grant under the Company’s stock option plans, and shares due in connection with consulting agreement. As of April 30, 2011, shares reserved for future issuance are comprised of the following:

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Stock Option Plan

The Company’s 2009 Stock Option Plan provides for the granting of equity awards, including restricted stock and incentive and nonqualified stock options to purchase up to 15,000,000 shares of the Company’s common stock, to employees, directors, officers and independent consultants of the Company.

A summary of stock option activity in connection with the 2009 Stock Option Plan as of April 30, 2011 is as follows:

Stock based compensation expense included in selling, general and administrative expense for the three and six months ended April 30, 2011 totalled $49,673 and $99,434, respectively. Stock based compensation expense included in selling, general and administrative expense for the three and six months ended April 30, 2010 totalled $64,065 and $65,542, respectively. The amount of unearned stock-based compensation currently estimated to be expensed from now through fiscal 2012 related to unvested share-based payment awards at April 30, 2011 is $89,347.

On November 7, 2010, 1,129,034 stock options granted to a Lender and related party in November 2008 in connection with the Convertible Loan Agreement expired. On January 14, 2011, the Company granted 1,129,034 warrants to purchase 1,129,034 shares of the Company’s common stock at the exercise price of $0.20 per share, expiring on January 15, 2013. The Company recognized the fair value of the change under the Black-Scholes model totaling $81,615 effective December 17, 2010.

On January 14, 2011, the Board of Directors extended the expiry dates of warrants, issued in August 2009 in connection with the borrowing of funds for working capital purposes, from January 15, 2011 to January 15, 2013. The funds were provided by 0840386 B.C. Ltd. and/or its nominees, 0793296 B.C. Ltd, and 0885084 Alberta Inc., a company related to the Company’s Chief Executive Officer, Chief Financial Officer, and other third party investors.

The Company has evaluated subsequent events, as defined by ASC 855, “Subsequent Events,” through the date that the financial statements were issued.

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On May 16, 2011, Nexaira, Inc., the Company’s subsidiary, entered into a Loan Agreement with Centurion Credit Funding LLC (the ‘Lender”), pursuant to which the Lender provided a $300,000 bridge loan (the “Bridge Loan”) and up to a $2.2 million revolving purchase order financing loan (the “Revolving Loan”). The maturity date for the Bridge Loan is October 24, 2011 and the maturity date for the Revolving Loan is May 16, 2012. The Company executed the Loan Agreement solely in connection with the conversion provisions of the Loan Agreement, pursuant to which any obligations (including any accrued interest and fees) owing under the Loan Agreement are convertible into shares of the Company’s common stock at an conversion price equal to seventy (70) percent of the weighted average sale price per share over the thirty (30) day period prior to the conversion date.

Outstanding advances under the Bridge Loan and the Revolving Loan bear interest at the rate of 36% per annum. Following the occurrence and during the continuance of an event of default advances bear interest at the rate of 46% per annum.

The Revolving Loan provides for advances for inventory in an amount equal to the initial deposit required by a supplier in connection with the manufacture or supply of inventory (a “Deposit Revolving Advance”). Any outstanding balance of any Deposit Revolving Advance is due and payable on the earlier of receipt of funds from the applicable customer or 120 days after the making of such Deposit Revolving Advance. The Revolving Loan also provides for advances in an amount equal to the remaining amount due to a supplier for inventory manufactured or supplied by such supplier (a “Balance Revolving Advance”). Any outstanding balance of any Balance Revolving Advance shall be due and payable on the earlier of receipt of funds from the applicable customer or 60 days after the making of such Balance Revolving Advance.

Maturity of the Bridge Loan and the Revolving Loan may be accelerated if there is an event of default, as that term is defined in the Loan Agreement.

In connection with the Loan Agreement, the Company and its subsidiaries granted security over all of the Company’s assets and guaranteed repayment of all obligations owing under the Loan Agreement.

Also in connection with the Loan Agreement, the Company issued share purchase warrants to the Lender to acquire up to 15 million shares of common stock, 4 million of which are immediately exercisable and 11 million of which become exercisable as to 1 million per month beginning on June 16, 2011 provided that there remains unpaid amounts under the Loan Agreement. All warrants become immediately exercisable if there is an event of default, as that term is defined in the Loan Agreement. Upon repayment of all obligations under the Loan Agreement, all share purchase warrants that have not yet become exercisable will expire. All warrants will be exercisable for a period of three years from the date that such warrants become exercisable. The exercise price is equal to $0.10 subject to adjustment from time to time.

On May 16, 2010, the Company issued 350,000 warrants at an exercise price $0.15 per share to Reedland Capital Partners, as a commission in connection with the Loan Agreement.

On June 2, 2011, the Board of Directors authorized a non-brokered private placement offering of up to US $300,000 to US accredited investors. The Company will enter into US subscription agreements at US $0.10 per unit, each unit compromising one common share and common share purchase warrant exercisable into one common share at the exercise price of US $0.15 at any time within three years from closing date. The offering is expected to close on or before June 30, 2011. Of this offering, the Company has received proceeds of $100,000 for general working capital purposes as at June 14, 2011.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s discussion and analysis of financial condition and results of operations (“MD&A”) is provided as a supplement to the accompanying condensed consolidated financial statements and footnotes to help provide an understanding of our financial condition, changes in our financial condition and results of our operations. The MD&A is organized as follows:

• Caution concerning forward-looking statements. This section discusses how forward-looking statements made by us in the MD&A and elsewhere in this report are based on management’s present expectations about future events and are inherently susceptible to uncertainty and changes in circumstances.

• Company Overview. This section provides an introductory overview and context for the discussion and analysis that follows in the MD&A.

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• Results of operations. This section provides an analysis of our results of operations for the three months ended April 30, 2011 and 2010 and the six months ended April 30, 2011 and 2010. A brief description is provided of transactions and events that impact the comparability of the results being analyzed.

• Outstanding Share Data. This section provides the designation and number or principal amount of (a) each class and series of voting or equity securities for which there are securities outstanding; (b) each class and series of securities for which there are securities outstanding if the securities are convertible into, or exercisable or exchangeable for, voting or equity securities and (c) each class and series of voting or equity securities that are issuable on the conversion, exercise or exchange of outstanding securities.

• Financial condition and liquidity. This section provides an analysis of our cash position and cash flows, as well as a discussion of our financing arrangements and financial commitments.

• Critical accounting policies. This section discusses those accounting policies that are both considered important to our financial condition and operating results and require significant judgment and estimates on the part of management in their application.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q contains forward-looking statements. Forward-looking statements are projections of events, revenues, income, future economic performance or management’s plans and objectives for future operations. In some cases, you can identify forward-looking statements by the use of terminology such as “may”, “should”, “expect”, “plan”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or “continue” or the negative of these terms or other comparable terminology. Examples of forward-looking statements made in this quarterly report on Form 10-Q include statements about:

• Our future strategy discussed under the heading “Nexaira’s Business and Outlook”;

• Our belief that certain vertical sales channels may have an impact on our revenue plan;

• Our discussion regarding any future filings for patent protection;

• Our business plan for the next twelve months discussed under the heading “Plan of Operations”;

• Our ability to meet the demands from our growing customer base;

• Our encouragement by the positive trends established in terms of our month over month unit sales increases;

• Our intention to raise $5 million through equity financing by August 2011; and

• Our anticipated cash requirements for the next six and twelve months;

These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including:

• General economic and business conditions;

• We may not be able to obtain additional financing;

• We are dependent almost exclusively on outside capital;

• Our directors and officers have the ability to influence matters affecting our stockholders;

• Our financial results are subject to fluctuations;

• Our market share, revenues, and gross margin may decrease as a result of competition with new or established wireless communication companies;

• Our acquisition of additional assets and businesses may have a negative effect on our share price and results of operations;

• The loss of any of our significant customers could adversely affect our revenue and profitability;

• We are dependent on a single source supplier for some components, which increases the risk that we will be unable to obtain key materials required for our products;

• We rely on a limited number of third parties to manufacture our products, which increases the risk that we will be unable to obtain our products in a timely manner;

• Changing technology may reduce the value of our intellectual property;

• We may infringe on the intellectual property rights of others;

• Others may attempt to copy aspects of our products and technology without our permission;

• Exchange rates between the United States and Canada may affect our results of operations;

• We may be unable to retain our key employees;

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• Government regulations could increase our cost of doing business;

• Our efforts to restructure our business may be unsuccessful; and

• The risks in the section of this quarterly report entitled “Risk Factors”,

any of which may cause our company’s or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

While these forward-looking statements and any assumptions upon which they are based are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States and Canada, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

COMPANY OVERVIEW

We develop and deliver third and fourth generation (3G/4G) wireless routing solutions that offer speed, reliability and security for carriers, mobile operators, service providers, value added resellers (VARS) and enterprise customers. We believe our routing solutions are simple to install, yet provide the advanced management and business class features demanded by the most sophisticated users. We believe our wireless devices are ideal for secure high availability wireless applications acting as the primary router on wireless, digital subscriber lines (DSL), or cable networks or can be used to provide complete device and network redundancy in wide area network-failover/fail back applications.

When our company was formed in 2005, the key focus was to build an organization focused on wireless data communications technology and to develop key supplier and customer relationships.

In 2008, we initiated the development of a new wireless routing platform and for the first time in our history began writing our own proprietary firmware and software. We retooled our operations and processes to provide compelling 3G/4G wireless routing solutions that we believe are highly competitive in both function and price.

In March 2009, we announced the availability of our i3 GUI™ (patent pending) graphical user interface for our small office/home office (SOHO) and business class routers. We believe our i3 GUI quickly and effortlessly displays a comprehensive real time view of router status including auto-configuration results of internet wide area network (WAN) connections, which reduces customer support requirements and maintenance costs for service providers, carriers and managed virtual network operators.

During our last fiscal year we launched three new products: (i) our Business Class II high availability router (BCII); (ii) our High Availability network Adapter (HANA^TM); and (iii) our 3G/4G SOHO router. We believe that we have developed a highly robust and secure “adaptive wireless technology platform” that incorporates security functionality and management capability historically only found in wireline routing hardware which we believe is unique in the wireless industry. Unlike many of our competitors, we uniquely own and control all aspects of the processor design, firmware and software and can consistently and rapidly develop features and functions required by our customers. This not only improves speed to market but enables us to customize our routing software to meet the specific needs of customers in specialized and unique industry verticals such as ATMs, Kiosk and wireless CCTV security cameras.

Our development staff has engineered a family of proprietary wireless 3G/4G routers that we believe will outperform the competition at a lower price while maintaining significant gross margins. In parallel with this product development we believe we have built an experienced management team and Board of Directors. Our sales and operations are headquartered in San Diego and our corporate office is in Vancouver, British Columbia.

Nexaira’s Business and Outlook

We believe our product line will enable our customers to expeditiously connect to and manage secure high speed data connections rivaling traditional landline connectivity, with unmatched functionality, speed and ease of use all at a lower cost. Service providers have selected our routing solutions for their high availability WAN failover applications using a 3G or 4G cellular network to automatically “back up” or “stand in” when service from wireline networks is interrupted. As the marketplace continues to deploy our secure high availability wireless applications as primary access points, void of any wireline connection, we believe there is potential revenue and sales growth in this emerging market. Additionally, we believe that carriers and service providers can dramatically decrease their total cost of ownership (TCO), including management of their installed hardware base, by using our advanced firmware which may extend the shelf life of their customer premise equipment while providing critical device updates through simple downloads. We enable our customers to bring customized wireless broadband solutions to market more quickly and cost effectively than traditional wireline offerings such as DSL, cable or T-1s.

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

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

Future Strategy. We intend to:

Products and Services

Our highly customizable and secure routing solutions are designed to aggressively compete against both wireline and other wireless broadband data applications. By developing our own firmware and software and leveraging our deep understanding of wireline and wireless network security protocols we believe we have established our company as a progressive and innovative organization with the proven management capabilities to execute on an accelerated go-to-market strategy.

Powerful and Secure Software Tools

• Iconic images (similar to the iPhone) on the dashboard to improve customer confidence, ease of use, retention and use of router tools.

• Intuitive structure with simple and logical menu flow to accelerate customer understanding of router functions, minimize apprehension and providing a positive customer and user experience.

• Interactive and automated set-up wizard that displays auto-configuration results of the 3G or 4G connection and provides responsive functional tool tips, which minimizes user frustration and reduces product returns.

• The most advanced wireless features and performance in the industry such as self-provisioning and NexWare's proprietary tuning algorithm which optimizes cellular bandwidth making it easy for end-users to take advantage of broadband speeds without delays, costs or complexities associated with wireline installs.

• Universal Plug in Play (UPnP) automatically connects any 3G or 4G data card to any cellular network.

• Enterprise-grade networking management and security capabilities include auto-failover to a 3G or 4G wireless network to back up the primary wireline network.

• Virtual router redundancy protocol (VRRP) eliminates single point of failure by providing redundancy for the wireline network and router.

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• Virtual private networks (VPN) with internet protocol security (IPsec) pass-through and termination protocols provide business class security.

• Wi-Fi 802.11n 2x2 MIMO; statefull packet firewall technology; QOS (Quality of service) for business applications as well as support for General Routing Encapsulation (GRE).

• Wi-Fi scheduling and quality of service (QOS) provides the ability to segregate critical applications to ensure service quality.

BCII

The BCII includes security and network protocols for business customers who want to leverage the high availability aspects of the cellular networks for failover, primary access or remote/mobile locations but with the business class features traditionally found only on wireline products. The BCII extends enterprise or corporate networks over cellular broadband as well as supports traditional DSL, cable, T-1 or Ethernet, providing automatic failover with anti-flap and VRRP to ensure network stability. The BCII supports VPNs with IPSec termination allowing up to five simultaneous encrypted sessions.

With the deployment of the new 3G+ and 4G networks and NexWare^TM secure business class capabilities customers with remote locations can use these new high speed cellular networks as their primary network connection, saving both time and money. The BCII connects seamlessly with HSPA and HSPA + networks from AT&T, Bell and Rogers and Telus as well as 4G networks including Sprint and Clear’s WiMax and Verizon’s 4G LTE (Long Term Evolution). The BCII with XtremeSpeed™ technology optimizes the network connection to the Internet and corporate networks to maximize speed and throughput for business applications such as corporate email, interactive sessions and web access. The ability to interface to both high speed 3G and 4G networks allows businesses to use bandwidth intensive applications such as video conferencing, video surveillance and voice over IP (VoIP) all with advanced security, speed and business class functionality

HANA™

HANA (High Availability Network Adapter) provides our customers with access to the convenience and speed of the new high speed cellular networks for both existing and new business locations. HANA uniquely bundles all essential performance based cellular components including a directional antenna with 10dbi high gain (10x) for equipment rooms or noisy environments, an auto configurable network connection manager, and optional 3G/4G or dual mode modem for EVDO RevA, HSPA, HSPA+, WiMAX or LTE networks. All HANA products come in a ruggedized tamperproof enclosure and are also available with NEMA certification.

HANA provides immediate access to any cellular network for complete diversity to wired network infrastructure; industry standard VPN IPSec to ensure data security; IP address pass through to wireline router; router hardware redundancy via VRRP (Virtual Redundancy Routing Protocol); XtremeSpeed WAN optimization ensuring the fastest wireless connection; Wi-Fi 802.11n 2x2 MIMO; statefull packet firewall technology; QOS (Quality of service) for business applications as well as support for General Routing Encapsulation (GRE).

HANA has the ability to increase cellular coverage from IT closets by being placed in an optimum position for signal strength anywhere on the local area network (LAN) using power over the Ethernet (POE). In addition, HANA provides a secure and robust wireless connection acting as a primary network connection for companies with rural locations where wireline access is either unavailable or cost prohibitive, or where wireless signal strength is sub optimal.

SOHO

The new 3G/4G SOHO (Small Office Home Office) router is designed for the small office/home office market, the mobile worker and the road warrior. It provides instant and secure Wi-Fi service to a home or office without the need to run data cabling or subscribe to a wireline service.

The SOHO offers automated set-up with the i3 GUI, multiple user access to the Internet; 300 mbps speeds with 802.11n 2x2 MIMO Wi-Fi service; and a faster 3G/4G connection than using a data card on a laptop computer. The SOHO connects seamlessly with HSPA and HSPA + networks from AT&T, Bell and Rogers and Telus as well as 4G networks including Sprint and Clear’s WiMax and Verizon’s 4G LTE (Long Term Evolution). As a result, we believe that users will no longer be subjected to the long installation times, service area coverage or repair time related to traditional wireline networks. Nexaira’s SOHO router is easy to install and does not require technical support. We believe that the NexConnect® SOHO router is ideal for users that want ease of use, security and auto-connect capability without the difficulty typically associated with installing a wireline router.

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Any of our routers when connected to a WiMAX network will produce throughput speeds 200% - 500% faster than EVDO revA networks, depending on location. When connected to Verizon’s LTE network, throughput speeds can improve tenfold. Additionally we believe that when combined with the speed to market advantage of wireless and the ability to reduce the total cost of ownership – more carrier, service providers and enterprises will be going wireless.

We have spent approximately $2,775,000 over the last two years on research and development activities of which $1,059,869 has been capitalized as software development costs in accordance with ASC 985-20, Accounting for the Costs of Computer Software to be Sold, Leased, or Otherwise Marketed. Software development costs are capitalized when technological feasibility and marketability of the related product has been established. Capitalized software costs are amortized on a product-by-product basis, beginning when the product is available for general release to customers.

Marketing and Sales Activities

We are seeing opportunities developing in multiple verticals across many market segments. Some select verticals listed below are where we are focusing our sales and marketing efforts and we believe that based on early adoption of our products that any one of these verticals could contribute significantly to our revenue plan, if not all. Sales activities are currently underway in each of the following segments, which we believe validates our strategy:

Business Applications

Business Continuity – Existing wireline network customers of Tier One and Tier Two carriers want a 3G or 4G routing solution that ensures their services are not interrupted in the event of a device failure or failure of the wireline network which is a common occurrence today. In most cases alternative broadband services are not available and if so rarely in a diverse route. Wireless broadband provides a completely diverse route matching or exceeding wireline bandwidth throughput. Our software, NexWare, provides business class reliability based on industry standard protocols and processes used for years in sophisticated wireline networking equipment. NexWare’s use of these protocols allows it to work with existing wireline equipment to provide network availability previously only supported by routers many times its price. We are actively engaged with multiple managed service and value added service providers developing secure high availability and business continuity services no longer able to be met with expensive and antiquated dial backup solutions.

Wireline Replacement - We believe we can compete with traditional landline routing products and wireline services by offering higher function and lower cost than what service providers have available to choose from today. With the advent of 4G LTE from companies like Verizon we have realistically seen download speeds up to 22mbps with upload speeds up to 10 mbps, up to ten times faster than existing DSL services.

Small Medium Sized Enterprises (SMEs) – With over 27 million SMEs in the US alone, this vertical is made up of quick service retail (QSR) and small businesses needing quick and simple installations and reliability offered by the combination of Nexaira routing solutions and high speed wireless networks. Small business owners may have neither the time nor the patience to wait for scheduled installation, which traditionally could take several weeks. In addition, we believe the reduced cost and improved performance of HSPA and HSPA+ WiMAX and LTE networks will offer this segment a compelling alternative to wireline.

Emerging and Developing Markets – Emerging markets in Brazil, Russia, India, and China, Latin America, Mid Eastern and African countries are growing faster than in developed countries and have taken the approach that wireline solutions are no longer the optimal, cost effective or timely choice. Management believes many countries will, if they have not already, stop building copper or even fibre networks in metropolitan areas, instead electing to use wireless networks for their Internet and data access needs.

SOHO (Small Office Home Office)

With millions working from home or on the road in hotel rooms, often in small teams of people, data cards with a one to one relationship to the wireless carrier are cumbersome and ineffective. The SOHO user, when he or she combines a data card from any carrier in the country, can benefit from improved security and throughput speed at a lower price. One data card can serve the needs of many when connected with our router and it is more secure than a hotel lobby or coffee shop and one does not have to pay the often exorbident hotel rates for WiFi Internet access. US Government employees are strongly discouraged from connecting to their corporate email from unsecured WiFi hotspots. With the SOHO, we believe that they need not be concerned.

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Speciality Verticals and M2M

Many installations currently exist that can take advantage of wireless networks connected using a Nexaira router, especially those applications that are difficult to reach with a wireline connection. One example is video survellence. Demand is ever increasing for CCTV cameras to be “networked” to allow for future viewing, but many installations cannot be reached with wireline connections or would be cost prohibitive even if they were. The market is also moving away from existing analog (dial-up) connections to IP Video connections using the Internet. According to IPMarketVideo.info IP video surveillance product sales will increase by 200% between 2010 and 2012, significantly disrupting and overtaking analog CCTV sales. Britain by all accounts has just 1% of the world’s population but accounts for over 20% of CCTV sales with an install base of more than 4.2 million. Another area where Nexaira routers are built directly into the device is ATMs. With over 500,000 ATM’s in North America alone, and an industry motivated to find a better solution because of the high cost and poor reliability of analog circuits or GPRS 2G radio signals, we believe a significant opportunity exists to migrate these existing devices to secure high speed wireless connections using Nexaira routers. We have developed a specific solution to replace the function of the dial-up modem and analog circuit, without changing any of the other components in the ATM itself, while proving a faster more secure and more reliable wireless connections – at lower cost.

Competition

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

The competition is divided into two distinct categories:

Intellectual Property

We have filed trademark applications and secured trademark registrations in the United States and Canada for various aspects of our product portfolio, including:

NexWare^TM for use in association with our computer firmware that provides auto-configuration for cellular wireless devices including routers, modules and modems;

NexWave^TM for use in association with our high gain cellular antenna product;

NexConnect® for use in association with our family of computer networking hardware products;

XtremeSpeed® for use in association with communication software and NexWare^TM wireless algorithm optimization; i3 GUI^TM our NexWare^TM Iconic Graphical User Interface, for use in association with communication software for providing Internet access;

HANA^TM for use in association with our family of high availability network adapters;

NEXAIRA®; and

Nexaira Wireless™.

We have patents pending related to our i3 GUI™ technology, and are in the process of evaluating the efficacy of filing for patent protection on other intellectual property.

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Employees

Our operations are headquartered in San Diego, California and our corporate office is in Vancouver, British Columbia. We have twenty-two employees, including consultants.

Corporate History

We were incorporated in the State of Nevada on March 19, 2007 under the name of Technology Publishing, Inc. On June 1, 2007, we entered into a share purchase agreement whereby we acquired all of the issued and outstanding shares of Westside Publishing Ltd. We divested Westside Publishing Ltd. effective October 28, 2009 as consideration for the cancellation of 40.8 million shares of our restricted common stock. Also on October 30, 2009, 20 million restricted common shares held by a former officer and director, were surrendered for cancellation under a return to treasury order.

On September 29, 2009, we completed the acquisition of Nexaira Wireless (BC) Ltd. (“Nexaira BC”), its California subsidiary and its security holders, whereby we agreed to acquire all of the issued and outstanding common shares in the capital of Nexaira BC in consideration for the issuance of 15,489,262 restricted common shares on the basis of 1.75 shares of our common stock for every one Nexaira BC share.

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

We believe our wireless devices are ideal for secure high availability wireless applications acting as the primary router on wireless or wireline networks or they can be used to provide complete device and network redundancy in failover/fail back applications and when connecting remote M2M devices such as ATMs and CCTV cameras.

Plan of Operations

As highlighted in our October 31, 2010 annual audited consolidated financial statements, 2009 and 2010 was a period of significant change for us. Shifting from being a reseller of data cards for the wireless industry, in May 2010 we launched our first proprietary wireless routers that interface easily with the 3G and 4G wireless networks of Verizon, Sprint and AT&T as well as HSPA+ networks of Bell, Rogers and Telus. We re-aligned our operations as we exited from marginally profitable product lines and focused on developing our procurement and supply systems to support sales growth of our new products. During this time we were successful in raising enough working capital from investors to sustain operations and position us for growth in our emerging business. With a focus on designing, developing and distributing our own products – specifically wireless routing solutions which include firmware and software developed in house - we began selling our products in June of 2010. After months of testing, field trials, customer driven enhancements and modifications, we believe that we not only understand the customer requirements and the market verticals but have better control on the business and the challenges facing it. Being less dependent on the commodity based distribution business, we have now commercialized our proprietary routing solutions in an attempt to increase and broaden our revenue streams and gross margins. Our planned revenue growth and return to profitability is expected to come as a result of (1) the introduction of our innovative wireless router products and solutions (2) marketing and sales of our suite of products catering to the growing 3G/4G wireless business segment (3) expansion of our sales and operations team focused on the wireless marketplace and (4) the capability of securing a continuous stream of router hardware components to meet current and future sales demand. This, of course, is dependent on our ability to attract and raise new growth and working capital.

Over the next twelve months, as part of our overall business strategy and success in raising capital to fund our growth plans, we intend to continue to develop new markets, add new customers, strengthen our business relationships with strategic vendors and continue to be innovative in developing software and firmware to meet our customers’ needs. We also intend to continue to strengthen our management by attracting seasoned executives with sales, marketing, finance and technical expertise from the wireless and wireline industries.

Our go-to-market strategy will focus on the following key areas:

• Working with wireless carriers to package WAN failover solutions to merchants experiencing service interruptions associated with wireline network failure.

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• Continuing to build wireline and wireless carrier relationships with the goal of expanding relationships to approximately 300 carriers worldwide in five years.

• Continuing to identify and respond to our customers’ needs by introducing new product designs and solutions for 3G and 4G next generation networks,

• Engaging in business discussions with strategic partners in emerging nations where wireline infrastructure is not available.

• Establishing and developing relationships with manufacturers, VARS, distributors and managed service providers in North America.

• Leveraging customizable software and firmware to create new applications to enter new vertical markets.

We believe that we have established a strong foundation of IP (Intellectual Property), industry relationships, quality assurance methodologies and proprietary enabling technology, NexWare^TM, which can be readily adapted to meet the needs of specific partners and markets. Our objectives over the next 6 months are to continue to build value inside the business and move our company to a more profitable stage of growth. To support this growth, we believe we require approximately $5 million to drive our new business model, launch our new products, meet our customers’ needs and increase shareholder value. We have signed agreements with financial advisors and consultants to assist us in raising the necessary capital.

We intend to use financing raised to launch our sales and marketing campaign, procure router hardware components and provide the necessary working capital to allow management to achieve profitability from operations, which we believe will increase shareholder value.

RESULTS OF OPERATIONS

THREE AND SIX MONTHS ENDED APRIL 30, 2011 COMPARED TO APRIL 30, 2010

To ensure that we positioned our company for the future growth forecasted in the wireless 3G/4G sector, we turned our attention away from being solely dependent on the manfuacturers we represented towards designing and developing our own products – specifically 3G/ 4G wireless routing firmware and hardware. This focus on developing and marketing our own line of products has impacted our revenues when compared to the same period in 2010. After 18 months of testing, field trials, customer driven enhancements and modifications, we believe that we not only understand the customer requirements and the market verticals but have better control on the business and the challenges facing it.

Revenues

Revenues for the three months ended April 30, 2011 were $247,558 compared to $525,053 for the three months ended April 30, 2010, a decrease of $277,495 or 53%. Total revenues for the six months ended April 30, 2011 amounted to $539,058 compared to $1,031,391 for the same period in 2010, a decrease of $492,333. The decline in revenues in the quarter and six months ended April 30, 2011 was attributable in part to our decision to focus our resources on marketing our own line of products and move away from our dependence on the sale of non-Nexaira products such as data cards and modules, which for the same period in 2010 amounted to $438,175 and $296,956, respectively. A key contributing factor to the decrease in router sales in our second quarter was the lack of inventory on hand to meet customer orders. With the completion of a $2.2 million purchase order financing line announced May 16, 2011, we anticipate that this purchase order financing will enable our company to acquire inventory as needed to meet the demand of our suite of products from our growing customer base. On a more positive trend, our router revenue for the six months ended April 30, 2011 increased from $263,519 in 2010 to $384,615, up $121,096 or 46% during the same period in 2010. More importantly, Nexaira router sales as a percentage of total sales represented 71% for the six months ended April 30, 2011 compared to only representing 25% of total sales for the same period in 2010.

Although the sales ramp has not materialized as quickly as we anticipated, we are encouraged by the positive trend being established in terms of our month over month unit sales increases and the increasing number of sales leads and deals. We are signing new contracts in the business application, small office/home office and specialty and machine to machine vertical markets. We believe the raising of additional working capital will allow our company to augment its sales and marketing resources required to support our planned future revenue growth.

Cost of Product Sales

Cost of product revenues before amortization expense of $55,267 for the three months ended April 30, 2011 amounted to $159,781 or 64.5% of revenues compared to $464,777 or 88.5% of revenues for the same period in 2010. This overall decrease is attributable in part to lower revenues for the same period in 2010. The higher cost of product revenues as a percentage of revenues reflects the liquidation of modules during the second quarter. Total cost of revenues amounted to $215,048 for the three months ended April 30, 2011 as compared to $506,022 for the same period in 2010 and includes non cash expenses of $55,267and $41,245, respectively, relating to the amortization of router tooling costs and capitalized research and development costs.

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Gross Profit

Overall gross profit for the three and six months ended April 30, 2011 was $32,510 and $110,402, respectively, or 13% and 20%, respectively, of total revenues from the sale of Nexaira routers, accessories and other manufacturer’s products that have lower margins. This compares to overall gross profit of $19,031 and $137,776, respectively, or 4% and 13%, respectively, of total revenues for the three months and six months ended April 30, 2010. The lower gross profit for the current quarter was impacted as a result of liquidating $52,500 in legacy module products at 15% margin. More significant is that the gross profit on Nexaira product router sales, excluding amortization expense of $109,904 which is a non-GAAP measurement, for the six months ended April 30, 2011 amounted to $172,948 or 45% on router revenues of $384,615 The gross profit on router product sales, excluding amortization expense which is a non-GAAP measurement, for the same period in 2010 amounted to $53,161 or 20 % on router revenues of $263,519. This increase in gross profit over the six months of 2010 shows the positive impact of introducing our higher margin product line launched and marketed in fourth quarter of 2010 after receiving certification in May/June 2010.

Research and Development

Research and development totaled $139,608 and $193,157 for the three months ended April 30, 2011 and 2010, respectively, for a total decrease of $53,549. For the six months ended April 30, 2011, research and development totaled $291,864 and $421,876, respectively, for a total decrease of $130,012. This decrease reflects a temporary re-allocation of resources from strict research and development activities to building functions, features and enhancements into our commercial ready products and working collaboratively with our current and potential customers in the Specialty Channels in the Machine to Machine verticals. This collaborative work includes on-site field testing, resolution of hardware issues and sales, marketing and engineering support. We continue to believe that investments in research and development will drive innovation which is critical to our future growth in revenues and customers and our ability to compete effectively in the marketplace.

We capitalize software development costs in accordance with ASC 985-20, Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed. Software development costs consist of labor and overhead costs related to development of our suite of NexWare™ firmware for our suite of wireless routers. Software development costs are capitalized when technological feasibility and marketability of the related product has been established. On June 1, 2008, we established technological feasibility upon successful completion and testing of our first working router product pilot firmware program. Capitalized software costs are amortized on a product-by-product basis over five years, beginning when the product is available for general release to customers. As of April 30, 2011, software development costs amounted to $837,230 which includes $109,374 related to the development of NexWare™ Enterprise Pro products expected to be released in the second half of 2011. Accordingly, amortization has not begun on this product to date.

Selling, General and Administrative

Selling, general and administrative expenses amounted to $744,892 for the three months ended April 30, 2011compared to $953,622 for the same period in 2010, for a decrease of $208,730. For the six months ended April 30, 2011, selling, general and administrative expenses amounted to $1,598,109 compared to $1,882,933 for the same period in 2010, for a total decrease of $284.824. The quarterly and six month decrease in selling, general and administrative expenses is a result of cost cutting measures, including a reduction in the work force and a reduction in legal and audit fees incurred during the same period in 2010. Included in selling, general and administrative expenses for the six months ended April 30, 2011 is $49,673 for stock compensation expense compared to $65,542 for the same period in 2010.

Loss from Operations

For the three months ended April 30, 2011, our net loss from operations was $851,989, compared to $1,127,748 in the same period in 2010. Our loss from operations amounted to $1,779,570 for the six months ended April 30, 2011 compared to a loss of $2,167,033 for the same period in 2010.

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Interest and Other Income

On January 13, 2011, we entered into a Debt Settlement and Subscription Agreement with a vendor. The transaction was recorded as a gain on settlement of note payable totaling $231,016. The remainder was primarily attributed to settlement of disputed accounts payable to our benefit.

For the three and six month period ended April 30, 2011, the Company recorded a gain of $35,979 on the increase in the decrease in fair value of the derivative related to warrants issued in connection with a private placement and an extension of the maturity date of a convertible note payable.

Interest and Other Expense

Interest expense for the three months ended April 30, 2011 amounted to $111,809 compared to $37,894 for the same period in 2010. Interest and other expense for the six months ended April 30, 2011 amounted to $358,115 compared to $140,559 for the six months ended April 30, 2010. The $358,115 is attributed to the increase in short term borrowings from a number of lenders and related parties during 2011 for general working capital purposes compared to the same period in 2010.

Net Loss

Net loss after interest, other income and income taxes amounted to $927,819 for the three months ended April 30, 2011 compared to $1,164,502 for the same period in 2010. Net loss after interest, other income and income taxes amounted to $1,848,936 for the six months ended April 30, 2011 compared to $2,307,252 for the same period in 2010. As our line of routers continues to gain acceptance in the marketplace, we believe our company’s losses will decrease over the next three quarters.

OUTSTANDING SHARE DATA

Common Shares

Total authorized share capital: 600,000,000 common shares @ U.S. $0.001 par value

COMMON SHARES

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

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

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

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

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

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

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

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

• our ability to attract and retain skilled technical employees;

• the availability of critical components from third parties;

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

• our ability to manufacture products at an acceptable price and quality.

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