10QSB

11/08/2005">

U.S. Securities and Exchange Commission

Washington, D.C.  20549

Form 10-QSB

(Mark One)

[ X]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2005

[  ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _____________ to ______________

Commission file number: 333-61424

US WIRELESS ONLINE, INC.

(Exact name of small business issuer as specified in its charter)

Nevada                                                                         82-0505220

(State or other jurisdiction of                                    (IRS Employer Identification No.)

                                                           incorporation or organization)

500 West Jefferson Street, Suite 2350

Louisville, Kentucky 40202

(Address of principal executive offices)

(502) 213-3717

 (Issuer’s telephone number)

Not Applicable

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

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 [  ]

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

Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under plan confirmed by a court.  Yes ____ No ____

APPLICABLE ONLY TO CORPORATE ISSUERS

The aggregate number of shares issued and outstanding of the issuer’s common stock as of September 30, 2005 was 93,054,870 shares of $0.001par value.

Transitional Small Business Disclosure Format (Check one):

Yes [  ] No [X]

1

FORM 10Q-SB

U.S. WIRELESS ONLINE, INC.

INDEX

		Page
PART I.	Financial Information
	Item 1.  Financial Statements Consolidated Balance Sheets (Assets) –September 30, 2005 (Unaudited) Consolidated Balance Sheets (Liabilities and Stockholders’ Equity) – September 30, 2005 (Unaudited) Consolidated Statements of Operations (Unaudited) - Three months ended September 30, 2005 and September 30, 2004 and nine months ended September 30, 2005 and September 30, 2004. Consolidated Statements of Cash Flows (Unaudited) - Nine months ended September 30, 2005 and September 30, 2004 Notes to financial statements (Unaudited) Item 2.  Management’s Discussion and Analysis of Financial Condition or Plan of Operation Item 3.  Controls and Procedures	3 4 5 6 7 9 11 18
PART II.	Other Information Item 1.  Legal Proceedings Item 2.  Changes in Securities Item 6.  Exhibits and Reports on Form 8-K	18 18 19 22
	Signatures	23

(Inapplicable items have been omitted)

2

PART I- FINANCIAL INFORMATION

ITEM 1. Financial Statements

In the opinion of management, the accompanying unaudited financial statements included in this Form 10-QSB reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the results of operations for the periods presented.  The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.

3

U.S. Wireless Online, Inc.

Consolidated Balance Sheets

ASSETS

	September 30,
	2005
	(unaudited)
Current Assets
Cash	$           523,347
Accounts Receivable	1,316,822
Other Receivable	122,290
Inventory	110,209
Undeposited Funds	6,910
Prepaid Expenses	198,578
Total Current Assets	2,278,156
Property & Equipment (Net)	6,052,478
Other Assets
Deposits	130,397
Other Assets	156,004
Goodwill	14,283,233
Total Other Assets	14,569,634
Total Assets	$      22,900,268

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

4

U.S. Wireless Online, Inc.

Consolidated Balance Sheets

LIABILITIES AND STOCKHOLDERS EQUITY

	September 30,
	2005
	(unaudited)
Current Liabilities
Accounts Payable	1,444,365
Accrued Expenses	289,346
Deferred Revenue	20,567
Short Term Debt	418,354
Current Portion of Long term debt	494,750
Total Current Liabilities	2,667,383
Long-Term Debt
Convertible Debentures	-
Credit Line	144,538
Notes Payable	5,161,718
Current Portion of Long Term Debt	(494,750)
Total Long Term Debt	4,811,507
Total Liabilities	7,478,890
Stockholders' Equity
Common Stock, Authorized 100,000,000 Shares, $.001
Par Value, Issued and Outstanding 93,054,870 shares	93,055
Preferred Stock, Authorized 5,000,000 Shares, $.001	5,000
Par Value, Issued and Outstanding 5,000,000 shares
Additional Paid in Capital	22,709,688
Retained Earnings (Deficit)	(7,386,365)
Total Stockholders' Equity	15,421,378
Total Liabilities and Stockholders' Equity	$     22,900,268

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

5

U.S. Wireless Online, Inc.

Consolidated Statement of Operations

(Unaudited)

	For the Three Months Ended		For the Nine Months Ended
	September 30,		September 30,
	2005	2004	2005	2004
Revenues	1,433,385	248,714	3,198,091	975,520
Cost of Sales	550,978	161,017	1,224,302	660,484
Gross Profit (Loss)	882,407	87,697	1,973,789	315,036
Operating Expenses
General & Administrative	1,414,608	251,334	3,300,230	963,048
Total Operating Expenses	1,414,608	251,334	3,300,230	963,048
Net Operating Income (Loss)	(532,201)	(163,637)	(1,326,441)	(648,012)
Other Income(Expense)
Gain on Settlement of Debt	411,635	-	688,542	-
Interest Expense	(44,986)	(14,300)	(98,944)	(42,990)
Total Other Income(Expense)	366,648	(14,300)	589,598	(42,990)
Net Income (Loss)	$   (165,552)	$    (177,937)	$    (736,843)	$    (691,002)
Net Income (Loss) Per Share	$          (0.00)	$           (0.01)	$           (0.01)	$           (0.04)
Weighted Average Common
Shares Outstanding	78,392,886	17,390,568	69,447,563	16,120,727

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

6

U.S. Wireless Online, Inc.

Consolidated Statement of Cash Flows

(Unaudited)

	For the Nine Months Ended
	September 30,
	2005	2004
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss)	$       (736,843)	$     (691,002)
Adjustments to Reconcile Net Loss to Net Cash
(Gain) Loss on Settlement of Debt:	(688,542)	-
Provided by Operations:
Depreciation & Amortization	461,617	287,378
Change in Assets and Liabilities
Gain on Sale of Equipment	-	(42,000)
Increase (Decrease) in  Bank Overdraft	(16,820)	(28,438)
(Increase) Decrease in Accounts Receivable	(1,180,864)	71,783
(Increase) Decrease in Deferred Revenue	(15,612)	1,731
(Increase) Decrease in Deposits and Prepaid Expenses	(302,886)	(19,294)
Increase (Decrease) in Accounts Payable/Accrued Expenses	391,950	148,695
Net Cash Provided(Used) by Operating Activities	(2,088,000)	(271,147)
CASH FLOWS FROM INVESTING ACTIVITIES:
Sale of Property and Equipment	-	77,159
Purchases of Property and Equipment	(941,704)	(31,264)
Net Cash Provided (Used) by Investing Activities	(941,704)	45,895
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment on Long Term Debt	(2,355,877)	(68,792)
Proceeds from Long Term Debt	3,549,163	318,248
Proceeds from Stock Issuances	2,359,765	-
Net Cash Provided(Used) by Financing Activities	3,553,052	249,456
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS	523,347	24,204
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD	-	-
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$         523,347	$         24,204

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

7

 U.S. Wireless Online, Inc.

Notes to the Consolidated Financial Statements

September 30, 2005

GENERAL

U.S. Wireless Online, Inc. (the Company) has elected to omit substantially all footnotes to the financial statements for the nine months ended September 30, 2005 since there have been no material changes (other than indicated in other footnotes below) to the information previously reported by the Company in their Annual Report filed on Form 10-KSB for the fiscal year ended December 31, 2004.

UNAUDITED INFORMATION

The information furnished herein was taken from the books and records of the Company without audit. However, such information reflects all adjustments which are, in the opinion of management, necessary to properly reflect the results of the interim period presented.  The information presented is not necessarily indicative of the results from operations expected for the full fiscal year.

ACQUISITIONS

The Company completed four acquisitions during the three months ended March 31, 2005, three acquisitions during the three months ended June 30, 2005 and two acquisitions during the three months ended September 30, 2005.  The acquisitions and transaction values are summarized below and described in more detail in the Company’s periodic reports filed on Form 8-K during period.

On January 11, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the acquisition of all the issued and outstanding stock of MJS Holdings, Inc., (“MJS”), an Ohio Corporation, in exchange for 6,110,906 restricted shares of the Company’s restricted common stock, par value $0.001 per share and a promissory note in the amount of $916,636.

On January 17, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the acquisition of all outstanding membership interests of United Broadband Networks, LLC (“UBN”), a Kentucky limited liability company, in exchange for 2,266,667 restricted shares of the Company’s restricted common stock, par value $0.001 per share and a promissory note in the amount of $63,000.

On February 1, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the asset acquisition of Yireless1.NET, LLC, (“YYireless1”) a Pennsylvania limited liability company (“YY1”), in exchange for 1,527,759 restricted shares of the Company’s restricted common stock, par value $0.001 per share along with a demand promissory note in the amount of $22,760 without interest, cash in the amount of $34,080 and the assumption and payment of certain YY1 liabilities.

On March 2, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the acquisition of the assets and business of Air2Lan, Inc. (“A2L”) a Delaware Corporation, in exchange for 5,000,000 restricted shares of the Company’s Class A Preferred Stock, par value $0.001 per share.  The Class A Preferred Stock has 10 votes per share and has 10 to one conversion rights for shares of restricted common stock of the Company.

On April 15, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the acquisition of VoIPWorks, LLC, (“VPW”) an Ohio limited liability company, as a wholly-owned subsidiary in exchange for $10,000 cash plus restricted shares of US Wireless common stock, par value $0.001 per share, in an amount of shares equal to $80,000.  

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On April 29, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the acquisition of all the assets of Verge Wireless Networks, Inc., a Louisiana corporation (“Verge”).  Verge assets include all tangible property, prepaid items, warranties, books, records and supplier information, customer lists and files, contracts, leases and various other assets.  The purchase price, as determined by management, for the Verge assets was a total of $560,000 with $40,000 payable upon closing, $40,000 payable via a 12 month promissory note and $480,000 payable in restricted common stock of US Wireless at an average closing price of the five trading days immediately prior to the closing date of this transaction but not less than $0.17 per share or greater than $0.30 per share. As a condition of payment, fifty percent of the US Wireless shares must be held for a minimum of 12 months from the date of issuance and the balance must be held for a minimum of 24 months from the date of issuance.

On May 9, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the acquisition of iSkywire, LLC, and its related entities including iSkywire, Jeffersontown, Kentucky I, LLC; iSkywire, New Albany, Indiana I, LLC; iSkywire, Charlestown, Indiana I, LLC, (collectively “iSkywire”).  The Company acquired all of the membership interests of iSkywire in exchange for that amount of shares of US Wireless common stock equal to $200,000. 1,000,003 shares were issued in the exchange.  As a condition of payment, fifty percent of the shares must be held for a minimum of 12 months from the date of issuance and the balance must be held for a minimum of 24 months from the date of issuance.   In addition, the Company executed a promissory note in the amount of $70,000 and paid cash at closing of $30,000. The term of the Promissory Note is eighteen (18 ) months and is to be paid in equal monthly installments.  The first payment will be due at Closing and the subsequent payments will be due on the 1^st of every  calendar month.  

On August 22, 2005, in an arms length transaction not involving any affiliates or related parties, US Wireless Online, Inc. completed the acquisition of all the assets of DHR Technologies, Inc., d/b/a Skyline Broadband (“Skyline”).  Skyline assets include assets include wireless communication assets, all tangible property, prepaid items, warranties, books, records and supplier information, customer lists and files, contracts, leases and various other assets.  The purchase price, as determined by the Company’s management, for the Skyline assets was as follows:  Payment Structure:  A $250,000 Promissory Note to be paid over twelve equal monthly installments beginning on the closing date; $1,723,618.00 to be paid in common stock of $0.17 per share (the “Shares”).  50% of the Shares must be held for a minimum of 12 months from the date of issuance, subject thereafter only to limitations set for th in Rule 144, and 50% of the Shares must be held for a minimum of 24 months from the date of issuance.  Additional transaction details are provided on Form 8-K filed by the Company on August 24, 2005.

On August 26, 2005, in an arms length transaction not involving any affiliates or related parties, US Wireless Online, Inc. completed the acquisition of all the assets of IP Outlet, Inc. (“IP Outlet”).  IP Outlet assets include assets include wireless communication assets, all tangible property, prepaid items, warranties, books, records and supplier information, customer lists and files, contracts, leases and various other assets.  The purchase price, as determined by the Company’s management, for the IP Outlet assets was as follows:  Payment Structure:   $1,270,400.00 to be paid in common stock of $0.25 per share (the “Shares”).  50% of the Shares must be held for a minimum of 12 months from the date of issuance, subject thereafter only to limitations set forth in Rule 144, and 50% of the Shares must be held for a minimum of 24 months from the date of issuance. 

9

					Total	Cash	Notes	Debts	Total
	Shares		Closing	Stock	Stock	Paid at	Issued at	Paid at	Value
Company Name	Issued	Type	Date	Price ($)	Value ($)	Closing ($)	Closing ($)	Closing ($)	($)
MJS Holdings	6,111,906	Common	10-Jan-05	0.21	1,283,500		916,636		2,200,136
United Broadband Networks	2,266,667	Common	17-Jan-05	0.22	498,667		63,000		561,667
YYWireless1.NET	1,527,759	Common	1-Feb-05	0.29	443,050	34,080	22,760	175,503	675,393
Air2Lan	5,000,000	Preferred	2-Mar-05	0.19	9,500,000				9,500,000
VoIP Works	400,000	Common	15-Apr-05	0.20	80,000	10,000			90,000
Verge Wireless	2,637,363	Common	29-Apr-05	0.175	461,539	40,000	40,000		560,000
Iskywire	1,000,003	Common	15-May-05	0.20	200,000	30,000	70,000		300,000
Skyline Broadband	10,138,929	Common	22-Aug-05	0.17	1,723,618		250,000		1,973,618
IP Outlet	5,081,600	Common	26-Aug-05	0.25	1,270,400				1,270,400

COMMON STOCK

On January 3, 2005, U.S. Wireless converted $140,000 of debt into 1,625,000 shares of restricted common stock.  The shares were issued to two accredited investors for cancellation of the debt.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On January 3, 2005, U.S. Wireless issued 950,000 shares for services valued at 66,500.  The shares were issued to one investor for consulting services rendered.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On March 1, 2005, U.S. Wireless converted $159,657 of debt into 11,914,727 shares of restricted common stock.  The conversion price for the shares was set on November 17, 2004.  The shares were issued to three accredited investors for cancellation of the debt.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.  

10

On April 26, 2005, U.S. Wireless converted $21,080 of accounts payable into 124,000 shares of restricted common stock.  The shares were issued to two investors for cancellation of the debt.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On May 15, 2005, U.S. Wireless converted $10,000 of accounts payable into 50,000 shares of restricted common stock.  The shares were issued to four investors for cancellation of the debt.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On August 22, 2005, U.S. Wireless converted $296,382 of debt into 1,743,422 shares of restricted common stock.  The shares were issued to two investors for cancellation of the debt.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On September 16, 2005, U.S. Wireless converted $52,251 of accounts payable into 307,361 shares of restricted common stock.  The shares were issued to two investors.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

During the nine month period ending September 30, 2005, US Wireless sold a total of 20,257,613 restricted shares of common stock for a total of $2,359,765.  The shares were issued to accredited investors only. U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act to effect the transaction.  No commissions were paid.

ITEM 2. Management’s Discussion and Analysis or Plan of Operation

Safe Harbor for Forward-Looking Statements

When used in this report, the words “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “intend,” and similar expressions are intended to identify forward-looking statements within the meaning of Section 27a of the Securities Act of 1933 and Section 21e of the Securities Exchange Act of 1934 regarding events, conditions, and financial trends that may affect the Company’s future plans of operations, business strategy, operating results, and financial position.  Persons reviewing this report are cautioned that any forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties and that actual results may differ materially from those included within the forward-looking statements as a result of various factors.  Such factors are discussed under the “Item 2. Management’s D iscussion and Analysis of Financial Condition or Plan of Operations,” and also include general economic factors and conditions that may directly or indirectly impact the Company’s financial condition or results of operations.

11

Our History and Business

We were formed as a Nevada corporation under the name Llebpmac, Inc. on May 4, 1998.  On October 2, 2000, our shareholders approved a two for one forward split of our outstanding common stock.  On November 1, 2000, we changed our name to Cach Foods, Inc.  Cach Foods, Inc. became a public company on October 17, 2001. On May 12, 2003, we entered an agreement and plan of reorganization with US Wireless Online, Inc.  The agreement closed on May 19, 2003.  Prior to closing, the Company effected a 0.48 to one reverse split of the then 12,152,000 currently issued and outstanding shares into 5,832,960 shares.  Our former president and director then cancelled 3,820,000 post-split shares that he owned.  As a result of this series of transactions, 11,492,565 post-reverse split shares of Cach Foods common stock were exchanged for all of the issued and outstanding shares of US Wireless Online, Inc. making US Wireless Online, Inc. a wholly-owned subsidiary of Cach Foods.  

Pursuant to the Agreement, the former officers and directors of Cach Foods resigned and David M. Ragland, Doug Keeney, Dan Burke, Sr., and James D. Murphy became directors of the Company and the Company changed its name from Cach Foods, Inc. to US Wireless Online, Inc.

US Wireless Online incorporated in 2000 to offer high-speed, low cost Internet access to small and medium sized businesses.  After six months of development and beta testing, US Wireless Online inaugurated commercial service in Atlanta, Georgia on January 1, 2001.  In February 2001, US Wireless Online successfully bid for certain operating assets of SENETS, a Multiple Dwelling Unit (“MDU”) operator then undertaking reorganization under Chapter 11 of the US Bankruptcy Code.  US Wireless Online used these assets to upgrade the Atlanta network.  In May 2001, US Wireless Online successfully acquired the wireless operations of Darwin, Inc., a hybrid MDU/wireless operator in Kentucky then also undertaking reorganization under Chapter 11. Through the Darwin acquisition, US Wireless Online acquired markets in Kentucky and Ohio and acquired a carrier-grade Network Operations Center.

On August 31, 2004, Mr. David Ragland and Mr. James Murphy resigned as directors of U.S. Wireless and Mr. Daniel Burke, Sr. and Mr. Douglas Keeney stepped down as officers.  Rick E. Hughes was appointed to the Board of Directors and was named President, Chief Executive Officer, Chief Financial Officer and Secretary of U.S. Wireless.  Mr. Hughes’ appointment reflects a renewed commitment by U.S. Wireless to focus its efforts on increasing revenues and expanding its core business operations, namely the offering of wireless internet broadband access and related services to businesses.  Since his appointment, Mr. Hughes has directed the active pursuit and completion of several strategic business acquisitions outlined below.

In 2005, as a result of the Company’s growth and recent acquisitions, US Wireless expanded its management team to include the following new officers and directors:

Name

Rick E. Hughes

Jack B. Dulworth

Thomas J. Busic

Michael D. Marlowe

David B. Latham

Jai P. Bhagat

12

Larry G. Townsend
Donald L. Perlyn
W. Glenn Hogan
Timothy Pisula Age
36
42
28
33
42
58
63
62
43
42 Positions
CEO, CFO and Director
President and Director
COO and Director
Chief Development Officer and Director
Director
Director
Director
Director
Director
Executive Vice President, Broadband Technology

On January 11, 2005 U.S. Wireless completed the acquisition of all the issued and outstanding stock of MJS Holdings, Inc., (“MJS”), an Ohio Corporation. MJS is now a wholly owned subsidiary of U.S. Wireless. As part of this transaction, the two sole shareholders of MJS were appointed officers of U.S. Wireless. Thomas J. Busic was appointed Chief Operating Officer and Sr. Vice President, Engineering and Michael Marlowe was appointed Chief Development Officer and Sr. Vice President, Marketing. MJS consists of two divisions. The first division, Bluemile Wireless (http://www.bluemilewireless.com) provides wireless internet broadband service to an area of approximately 700 square miles including Cincinnati, Columbus, Dayton, and surrounding areas. The second division, Instant Workplace (http://www.instantworkplace.com) is an Application Service Provider (ASP) with offices in Cleveland and Columbus.

On January 17, 2005, U.S. Wireless completed the acquisition of all outstanding membership interests of United Broadband Networks, LLC (“UBN”), a Kentucky limited liability company. UBN provides business class connectivity with high capacity data connections over a fixed wireless communications network and currently delivers service to over 500 square miles in Jefferson County, Kentucky and Southern Indiana.

On February 1, 2005, U.S. Wireless completed the acquisition of YYireless1.NET, LLC, (“YY1”), a Pennsylvania limited liability company. Consideration was paid to Digerati.biz, Inc., the sole member of YY1, which is owned and controlled by Mr. Timothy Pisula. As a result of the acquisition, Mr. Pisula, CEO of YY1, has joined the management team at U.S. Wireless as Executive Vice President of Broadband Technology. YY1 operates a state-of-the-art wireless broadband network in and around the Pittsburgh metropolitan area using three radio spectrums -- 900 MHz & 2.4 GHz for suburban applications and 5.3-5.8 GHz for high-density, commercial applications. Additionally, U.S.Wireless offers customer-engineered bandwidth and Metropolitan Area Network (MAN) solutions from 256 Kbps to 500 Mbps.

On March 3, 2005, U.S. Wireless completed the acquisition of the assets and business of Air2Lan, Inc. (“A2L”) a Delaware Corporation.  A2L provides broadband Internet access, wireless local area networks (WLAN), Wi-Fi roaming services, point-to-point connectivity, and value-added Internet services to businesses, residential complexes, hotels, and municipal governments.  A2L currently offers its services in Jackson, Mississippi; Memphis, Tennessee; Montgomery, Alabama; New Orleans and Monroe, Louisiana; and Houston, Texas.  Satellite markets include Vicksburg, Yazoo City, Greenville, Greenwood and Clarksdale in Mississippi; and West Memphis in Arkansas. A2L’s broadband solutions include VoIP, wireless video and security systems, and broadband mobility offerings.

On April 1, 2005, U.S. Wireless launched its own Voice over Internet Protocol (“VoIP”) service for small to medium sized businesses and institutions.  The Company’s soft switching platform was developed by Tekelec.  U.S. Wireless currently has switches located in Louisville, KY and Columbus, OH and has begun offering bundled services, which includes voice and data connectivity over a single wireless internet connection, in multiple markets.

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On April 15, 2005, US Wireless completed the acquisition of VoIPWorks, LLC, (“VPW”) an Ohio limited liability company, as a wholly-owned subsidiary.  VPW specializes in implementing voice and data technology solutions by utilizing strategic partners to provide its clientele with optimal equipment and service upgrades. Its experienced data and telecommunications professionals assist clients in evaluating the cost effectiveness, security, and reliability of their current telecom and data networks with available alternatives within their respective industries and/or markets.  VPW has been instrumental in the introduction of hosted VoIP solutions throughout the Midwest.  VPW’s services include: VoIPWorks Data & Telecommunications Audits, LAN Readiness Assessments, IPPBX, and IP VPN services that replace existing VPN or Frame Relay Networks.

On April 29, 2005, US Wireless completed the acquisition of all the assets of Verge Wireless Networks, Inc., a Louisiana corporation (“Verge”).  Verge assets include all tangible property, prepaid items, warranties, books, records and supplier information, customer lists and files, contracts, leases and various other assets.  Verge is a provider of broadband connectivity and solutions to municipalities, businesses, academic and medical institutions, convention centers, and the hospitality industry.  Verge provides municipal Wi-Fi “hot zones” in parts of Los Angeles, New Orleans and Baton Rouge.  It is also the wireless contractor for one of the largest broadband video security systems in the country, which allows the police department of a major municipality to coordinate video feeds from approximately 200 broadband-enabled wireless cameras.

On May 2, 2005, US Wireless entered a definitive agreement with Lightyear Network Solutions, LLC (“Lightyear”).  In exchange for preferred wholesale pricing and performance based equity participation, Lightyear will exclusively promote and sell US Wireless broadband connectivity service to its Business Class customers in US Wireless Online’s expanding network coverage area.  Under the terms of the agreement Lightyear has agreed to sell a minimum of 1,000 Business Class wireless broadband circuits during the first year of the contract, a minimum of 2,500 during the second year and a minimum of 4,000 during the third year.  Lightyear (www.lightyearcom.com) was founded in 1993 by J. Sherman Henderson, III as a national sales and marketing organization providing telecommunication services and solutions to both commercial and residential customers. In the course of normal business, Lightyear serves more than 150,00 0 customers nationwide generating annual revenue of over $80 million through an independent national sales force of Lightyear Agent Partners.

On May 9, 2005, US Wireless completed the acquisition of iSkywire, LLC, and its related entities including iSkywire, Jeffersontown, Kentucky I, LLC; iSkywire, New Albany, Indiana I, LLC; iSkywire, Charlestown, Indiana I, LLC, (collectively “iSkywire”).  ISkywire is a wireless broadband internet company that owns and operates state-of-the-art broadband wireless networks in Louisville, KY and southern Indiana and has provided cost-effective, reliable high-speed internet access to commercial customers since January 2002.

On June 9, 2005, U.S. Wireless and Aperto Networks, a leading WiMAX-class broadband wireless systems provider announced that U.S. Wireless had begun deployment of Aperto 5.8 GHz WiMAX-class PacketWave systems within its 3,000 square-mile network.  

On August 22, 2005, U.S. Wireless completed the acquisition of all the assets of DHR Technologies, Inc., d/b/a Skyline Broadband (“Skyline”).  Founded in 2000 and headquartered in Fort Myers, FL, Skyline Broadband (website: www.slbb.com) has recently purchased several competitors and created one of the largest independent Internet Service Provider Networks in Southwest Florida. The company offers a variety of broadband Internet options as well as web-hosting and network security services. Skyline currently has approximately 600 commercial and SOHO wireless broadband customers representing approximately 4,400 users, over 10,000 hosted domains and approximately 2,000 non-wireless Internet access customers.

On August 26, 2005, U.S. Wireless acquired all of the assets of IPOutlet.  Located in Columbus, Ohio, IPOutlet's data center encompasses 26,000 square feet. The facility serves as a primary location, disaster recovery site, and secondary location for its many corporate customers. Access to the facility is available via key card and PIN security systems 24/7/365, with all entry and exit points monitored via closed circuit television.

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The facility is equipped with state-of-the-art environmental and power resources, including thirteen 20-Ton HVAC units configured for N+1 redundancy, 3,000 amps of AC power, true online Uninterruptible Power Supply (UPS), Transient Voltage Surge Protection (TVSS) and a one megawatt standby generator capable of seven days run time on current load without refueling.  IPOutlet offers co-location services, high-capacity broadband connectivity, IP traffic engineering, security services, infrastructure management services, web hosting, disaster recovery services, Virtual Private Networking (VPN) and other customized business solutions.

Management believes these acquisitions will help U.S. Wireless achieve increased economies of scale and be positioned to accelerate growth organically in existing markets by expanding its wireless broadband Internet footprint. U.S. Wireless also intends to leverage its prominence in the broadband wireless industry to pursue additional strategic acquisitions.

By leveraging its carrier-grade Network Operations Centers and existing wireless broadband network infrastructure, U.S. Wireless Online intends to expand the geographic scope of its wireless service offerings, along with its revenue base, by providing premium broadband service options and broadband-dependent applications and services (such as VoIP, security systems and video services) through direct sales, channel sales partnerships and acquisitions within the emerging and highly fragmented wireless broadband industry. US Wireless is currently engaged in discussions with multiple potential channel sales partners and acquisition candidates.

Products

U.S. Wireless, core business is the provision of high-speed, wireless Internet access and related applications and services for businesses. During the fiscal year ended December 31, 2004 and before the subsequent acquisitions outlined above, U.S. Wireless’ services were provided to businesses in, Kentucky, Ohio, Georgia and Indiana.  As of September 30, 2005, U.S. Wireless provides services to expanded areas in Alabama, Arkansas, Kentucky, Louisiana, Ohio, Pennsylvania, Tennessee, Texas, Indiana, Mississippi and Georgia.

Spanning approximately 3,000 square miles across an eleven state region, the Company owns and operates one of the largest broadband wireless Internet networks in the nation.  The Company's carrier-grade Network Operations Center (NOC), comprehensive network architecture, and quality of service has resulted in thousands of corporate, municipal, institutional, and multi-tenant residential customers.  

U.S. Wireless utilizes advanced wireless technology in the license exempt spectrum bands to provide high speed, high quality Internet connectivity to its customers. Utilization of this spectrum provides the Company with a significant cost advantage over service providers that utilize licensed spectrum. The Federal Communications Commission has allocated over 900 MHz of license exempt spectrum for broadband wireless Internet services, providing abundant bandwidth for very high capacity and interference free Internet services.  License-exempt radio frequency (RF) equipment now incorporates "smart radio" technologies which mitigate interference.  The Company also uses licensed spectrum for wireless point-to-point and backhaul links.   

Along with providing broadband wireless Internet connectivity, the Company is also involved in the development and implementation of a comprehensive array of broadband Internet solutions. These solutions include voice over Internet protocol (VoIP), wireless video monitoring and security systems, local and metropolitan area mobility, virtual private networking, and network system design and installation. This comprehensive Internet solutions set provides high margin revenues, solidifies customer relationships and increases customer retention. Further, each of these solutions drives demand for the Company's core broadband wireless Internet service.

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U.S. Wireless has developed and is implementing a two pronged strategic business model. First, U.S. Wireless is focused on organic growth and operating profitability in the current markets it serves. We believe the implementation of disciplined business processes will allow us to realize significant economies of scale and expense reductions resulting from our recent acquisitions.

Additionally, we expect revenue growth in each market through product launches of our Internet solutions, bundling services and solutions, implementation of vertical market sales, and further expansion of our VoIP offering and related services.

The second strategic thrust will be a continued aggressive pursuit of complimentary and accretive acquisitions. The wireless Internet service provider industry remains highly fragmented, and at current valuations, acquisitions provide an economical vehicle for growth.

Results of operations for the three month periods ended September 30, 2005 and 2004:

Revenues  for  US  Wireless  for the three-month period ended September 30, 2005 were $1,433,385 with  a  cost  of  sales  of  $550,978 resulting in a gross profit of $882,407.  Revenues for the three-month period ended September 30, 2004 were $248,714 with a cost of sales of $161,017 and a resulting gross profit of $87,697. Compared to the results for the same period in 2004, during the period ended September 30, 2005 our revenue increased by 476%, cost of sales increased by 242% and resulting gross profit increased by 906%.  The increase in revenue, cost of sales and gross profit is primarily attributable to acquisitions completed in 2005.

	Revenue	COGS	Gross Profit
Q3 2005	1,433,385	550,978	882,407
Q3 2004	248,714	161,017	87,697
Increase (Decrease)	1,184,671	389,961	794,710
% Change	476%	242%	906%

Operating expenses and general and administrative expenses during the three-month period ended September 30, 2005 were $1,233,437 before depreciation and amortization (totaling $181,171 during the period) and $1,414,608 after depreciation and amortization resulting in a net operating loss of $351,030 before depreciation and amortization and $532,201 after depreciation and amortization.  Interest expense during the period was $44,986.  A net gain on settlement of debt of $411,635 was realized during period.  As a result of the foregoing, we realized a net loss of $165,552 during the three-month period ended September 30, 2005.  Operating expenses and general and administrative expenses during the three-month period ended September 30, 2004 were $ 251,334 resulting in a net operating loss of $163,637 including depreciation and amortization.  Interest expense during the period was $14,300. As a result of the foregoing, we realized a net loss of $177,937 during the three-month period ended September 30, 2004.  Compared to the results for the same period in 2004, during the period ended September 30, 2005 our operating and general and administrative expenses increased by 463%, interest expense increased by 215% and our net loss decreased by 7%.  The increase in operating and general and administrative charges is primarily attributable to expenses related to acquisitions completed in 2005.  

	SG&A	Interest Expense	Net Loss
Q3 2005	1,414,608	44,986	165,552
Q3 2004	251,334	14,300	177,937
Increase (Decrease)	1,163,274	30,686	(12,385)
% Change	463%	215%	-7%

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All revenues during the three-month period ended September 30, 2005 were derived from the Company’s business of providing wireless broadband connectivity solutions and related applications and services.  

Results of operations for the nine month periods ended September 30, 2005 and 2004:

Revenues for US Wireless for the nine-month period ended September 30, 2005 were $3,198,091 with a cost of sales of $1,224,302 resulting in a gross profit of $1,973,789.  Revenues for the nine-month period ended September 30, 2004 were $975,520 with a cost of sales of $660,484 and a resulting gross profit of $315,036.

Operating expenses and general and administrative expenses during the nine-month period ended September 30, 2005 were $2,838,613 before depreciation and amortization (totaling $461,617 during the period) and $3,300,230 after depreciation and amortization resulting in a net operating loss of $864,824 before depreciation and amortization and $1,326,441 after depreciation and amortization.  Interest expense during this period was $98,994.  A gain on settlement of debt of $688,542 was realized during period.  As a result of the foregoing, we realized a net loss of $736,843 during the nine-month period ended September 30, 2005. Operating expenses and general and administrative expenses during the nine-month period ended September 30, 2004 were $963,048 and resulted in a net operating loss for the period of $648,012. Interest expense during the nine-month period ended September 30, 2004 was $42,990.  As a result, our net loss for the nine-month period was $691,002.

Liquidity and Capital Resources:

At September 30, 2005, total assets were $22,900,268. Total current assets were $2,278,156 consisting of $523,347 in cash, $1,316,822 in accounts receivable, $110,209 in inventory, $6,910 in un-deposited funds, $198,578 in prepaid expenses and $122,290 in other receivables.  We also had property and equipment valued at $6,052,478. Other assets consisted of deposits of $130,397, $14,283,223 in goodwill and other assets of $156,004.  At December 31, 2004, total assets were $642,548 consisting of $195,958 in current assets, $408,501 in property and equipment and other assets  of $38,089.

Total liabilities at September 30, 2005 were $7,478,890.  Current liabilities were $2,667,383 consisting of $1,444,365 in accounts payable, $289,346 in accrued expenses, $20,567 in deferred revenue, $418,354 in short term debt and $494,750 in current portion of long term debt.  Other liabilities at September 30, 2005 consisted of credit lines balance of $144,538 and $4,666,968 in notes payable.  Total liabilities at December 31, 2004 were $2,993,136 consisting of $2,883,513 in current liabilities and $109,623 in long-term debt.

Management believes that we have sufficient cash and anticipated accounts receivable on hand to meet our immediate operating expenses.  However, we will require additional funding to continue to expand our business and reduce our liabilities.  We propose to fund these capital needs via the sale of common stock.   However, we cannot guarantee that we will generate sufficient proceeds on acceptable terms to meet our capital needs.  If we require additional capital, we may seek advances from officers or shareholders,  or  explore  other  debt  financing  strategies.

ITEM 3. Controls and Procedures

(a) Evaluation of disclosure controls and procedures. Based on the evaluation of our disclosure controls and procedures (as defined in Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) required by Securities Exchange Act Rules 13a-15(b) or 15d-15(b), our Chief Executive Officer/Chief Financial Officer has concluded that as of the end of the period covered by this report, our disclosure controls and procedures were effective.

(b) Changes in internal controls. There were no changes in our internal control over financial reporting that occurred during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

ITEM 1.  Legal Proceedings

On July 2, 2003, Enterasys Networks, Inc. filed a complaint against U.S. Wireless in the United States District Court for the Western District of Kentucky, Louisville Division.  The case is Enterasys Networks, Inc. v. U.S. Wireless Online, Inc., Civil Action No. 3:03CV-405-H.  Enterasys is seeking $181,844.40 plus interest at 8% from November 30, 2001, along with court costs and attorney’s fees.  The claim arises from a dispute concerning a convertible note payable.  In September of 2003, U.S. Wireless filed an answer and counterclaim, denying all allegations and seeking damages.  Enterasys has filed a motion to dismiss the U.S. Wireless counterclaim.  The dispute has not been resolved. U.S. Wireless intends to continue vigorously defending itself in this action and anticipates that it will either settle the litigation or prevail in court.

Beginning in the fourth quarter of 2004, management began attempting to contact and negotiate settlements with numerous vendors and other debt holders.  These liabilities were incurred prior to the appointment of the current management team and several involve balances that are disputed by the Company.  The settlement of these liabilities is an ongoing process that has been expanded to include certain liabilities incurred by Air2Lan, Inc.  These liabilities are reflected in the Company’s financial statements and, as they are discounted and/or written off, result in Other Income recorded on the Company’s Statement of Operations as a Gain on Settlement of Debt.  As a result of this process, certain creditors have filed lawsuits against U.S. Wireless for amounts that are strongly disputed by the Company.  To date these suits have been settled out of court.  U.S. Wireless intends to continue to vigorousl y defend itself in such actions and anticipates that it will either settle the litigation or prevail in court.

ITEM 2.  Changes in Securities

Pursuant to the May 19, 2003 Agreement and Plan of Reorganization between U.S. Wireless, Inc. and Cach Foods, Inc., Cach issued 13,472,846 shares of common stock in exchange for 49,442,170 shares of U.S. Wireless common stock representing all of the issued and outstanding shares of U.S. Wireless. The shares were issued in a private transaction without registration in reliance of the exemption provided by Section 4(2) of the Securities Act. No broker was involved and no commissions were paid on the transactions.

During 2004, U.S.Wireless issued 10,285,714 shares of common stock to settle $230,500 of notes payable and accrued interest. The shares were issued in a private transaction without registration in reliance of the exemption provided by Section 4(2) of the Securities Act. No broker was involved and no commissions were paid on the transactions.

On August 26, 2004, U.S. Wireless issued warrants to purchase 2,250,000 shares of the Company’s restricted common stock at an exercise price of $0.35 per share and expires August 26, 2007.  The warrants were issued in consideration of forgiving default on an outstanding note and agreement to negotiate a stock settlement. U.S.Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction and no commissions were paid.

On September 26, 2004, U.S. Wireless issued warrants to purchase 2,250,000 shares of the Company’s restricted common stock at an exercise price of $0.35 per share and expires September 26, 2007.  The warrants were issued in consideration of forgiving default on an outstanding note and agreement to negotiate a stock settlement. U.S.Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction and no commissions were paid.

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During 2004, the U.S. Wireless issued warrants in conjunction with an amended promissory note to purchase 275,000 shares of the Company’s restricted common stock at an exercise price of $0.50 per share.  The warrants are for a ten year period. U.S.Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction and no commissions were paid.

U.S. Wireless issued warrants to purchase 500,000 shares of the Company’s restricted common stock at an exercise price of $0.35 per share and expires August 26, 2007.  The warrants were issued in consideration of forgiving default on an outstanding note and agreement to negotiate a stock settlement. U.S.Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction and no commissions were paid.

On January 3, 2005, U.S. Wireless converted $140,000 of debt into 1,625,000 shares of restricted common stock.  The shares were issued to two accredited investors for cancellation of the debt.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On January 3, 2005, U.S. Wireless issued 950,000 shares for services valued at 66,500.  The shares were issued to one investor for consulting services rendered.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On January 11, 2005, in an arms length transaction not involving any affiliates or related parties, U.S. Wireless completed the acquisition of all the issued and outstanding stock of MJS Holdings, Inc., (“MJS”), an Ohio Corporation, in exchange for 6,110,906 restricted shares of U.S. Wireless restricted common stock, par value $0.001 per share. U.S.Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction and no commissions were paid.

On January 17, 2005, in an arms length transaction not involving any affiliates or related parties, U.S. Wireless completed the acquisition of all outstanding membership interests of United Broadband Networks, LLC (“UBN”), a Kentucky limited liability company, in exchange for 2,266,667 restricted shares of U.S. Wireless restricted common stock, par value $0.001 per share. U.S.Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction and no commissions were paid.

On February 1, 2005, in an arms length transaction not involving any affiliates or related parties, U.S. Wireless completed the asset acquisition of Yireless1.NET, LLC, (“YYireless1”) a Pennsylvania limited liability company (“YY1”), in exchange for 1,527,759 restricted shares of U.S. Wireless restricted common stock, par value $0.001 per share. U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction and no commissions were paid.

On February 2, 2005, U.S. Wireless sold an aggregate of $1,500,000 in 8% callable secured convertible notes representing the principal on up to $3,000,000 in notes due January 25, 2008. The notes are convertible into shares of Common Stock, pursuant to a Securities Purchase Agreement. Warrants to purchase an aggregate of 3,000,000 shares of common stock issued pursuant to the Securities Purchase Agreement for the 8% callable secured convertible notes were also issued on February 2, 2005. The Notes and Warrants were issued to a limited number of accredited investors and therefore the transactions were exempt from registration under Section 4(2) of the Securities Act, as transactions not involving any public offering and no commissions were paid.

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On March 2, 2005, in an arms length transaction not involving any affiliates or related parties, U.S. Wireless completed the acquisition of the assets and business of Air2Lan, Inc. (“A2L”) a Delaware Corporation, in exchange for 5,000,000 restricted shares of U.S. Wireless Class A Preferred Stock, par value $0.001 per share. U.S.Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction and no commissions were paid.

On March 1, 2005, U.S.Wireless converted $159,657 of debt into 11,914,727 shares of restricted common stock.  The conversion price for the shares was set on November 17, 2004.  The shares were issued to three accredited investors for cancellation of the debt.  U.S.Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On April 15, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the acquisition of VoIPWorks, LLC, (“VPW”) an Ohio limited liability company, as a wholly-owned subsidiary in exchange for $10,000 cash plus restricted shares of US Wireless common stock, par value $0.001 per share, in an amount of shares equal to $80,000.  Pursuant to this agreement the Company issued 400,000 shares of restricted common stock.  The shares were issued to two accredited investors.  U.S.Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On April 26, 2005, U.S. Wireless converted $21,080 of accounts payable into 124,000 shares of restricted common stock.  The shares were issued to two investors for cancellation of the debt.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On April 29, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the acquisition of all the assets of Verge Wireless Networks, Inc., a Louisiana corporation (“Verge”).  Verge assets include all tangible property, prepaid items, warranties, books, records and supplier information, customer lists and files, contracts, leases and various other assets.  The purchase price, as determined by management, for the Verge assets was a total of $560,000 with $40,000 payable upon closing, $40,000 payable via a 12 month promissory note and $480,000 payable in restricted common stock of US Wireless at an average closing price of the five trading days immediately prior to the closing date of this transaction but not less than $0.17 per share or greater than $0.30 per share. As a condition of payment, fifty percent of the US Wireless shares must be held for a minimum of 12 months fr om the date of issuance and the balance must be held for a minimum of 24 months from the date of issuance.   Pursuant to this agreement the Company issued 2,637,363 shares of restricted common stock.  The shares were issued to two accredited investors.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On May 9, 2005, in an arms length transaction not involving any affiliates or related parties, the Company completed the acquisition of iSkywire, LLC, and its related entities including iSkywire, Jeffersontown, Kentucky I, LLC; iSkywire, New Albany, Indiana I, LLC; iSkywire, Charlestown, Indiana I, LLC, (collectively “iSkywire”).  The Company acquired all of the membership interests of iSkywire in exchange for that amount of shares of US Wireless common stock equal to $200,000. 1,000,003 shares were issued in the exchange.  As a condition of payment, fifty percent of the shares must be held for a minimum of 12 months from the date of issuance and the balance must be held for a minimum of 24 months from the date of issuance.   In addition, the Company executed a promissory note in the amount of $70,000 and paid cash at closing of $30,000. The term of the Promissory Note is eighteen (18) months and is to be paid in equal monthly installments.  The first payment will be due at Closing and the subsequent payments will be due on the 1^st of every  calendar month.  Pursuant to this agreement the Company issued 1,000,000 shares of restricted common stock.  The shares were issued to two accredited investors.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

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On May 15, 2005, U.S. Wireless converted $10,000 of accounts payable into 50,000 shares of restricted common stock.  The shares were issued to four investors for cancellation of the debt.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On August 22, 2005, in an arms length transaction not involving any affiliates or related parties, US Wireless Online, Inc. completed the acquisition of all the assets of DHR Technologies, Inc., d/b/a Skyline Broadband (“Skyline”).  Skyline assets include assets include wireless communication assets, all tangible property, prepaid items, warranties, books, records and supplier information, customer lists and files, contracts, leases and various other assets.  The purchase price, as determined by the Company’s management, for the Skyline assets was as follows:  Payment Structure:  A $250,000 Promissory Note to be paid over twelve equal monthly installments beginning on the closing date; $1,723,618.00 to be paid in common stock of $0.17 per share (the “Shares”).  50% of the Shares must be held for a minimum of 12 months from the date of issuance, subject thereafter only to limitations set for th in Rule 144, and 50% of the Shares must be held for a minimum of 24 months from the date of issuance.  10,138,929 shares of restricted common stock were issued in the transaction.  There were no commissions paid.

On August 26, 2005, in an arms length transaction not involving any affiliates or related parties, US Wireless Online, Inc. completed the acquisition of all the assets of IP Outlet, Inc. (“IP Outlet”).  IP Outlet assets include assets include wireless communication assets, all tangible property, prepaid items, warranties, books, records and supplier information, customer lists and files, contracts, leases and various other assets.  The purchase price, as determined by the Company’s management, for the IP Outlet assets was as follows:  Payment Structure:   $1,270,400.00 to be paid in common stock of $0.25 per share (the “Shares”).  50% of the Shares must be held for a minimum of 12 months from the date of issuance, subject thereafter only to limitations set forth in Rule 144, and 50% of the Shares must be held for a minimum of 24 months from the date of issuance.  5,081,600 shares of restricted common stock were issued in the transaction.  There were no commissions paid.

On August 22, 2005, U.S. Wireless converted $296,382 of debt into 1,743,422 shares of restricted common stock.  The shares were issued to two investors for cancellation of the debt.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

On September 16, 2005, U.S. Wireless converted $52,251 of accounts payable into 307,361 shares of restricted common stock.  The shares were issued to two investors.  U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act and Regulation D, Rule 506 to effect the transaction.  There were no commissions paid.

During the nine month period ending September 30, 2005, US Wireless sold a total of 20,257,613 restricted shares of common stock for a total of $2,359,765.  The shares were issued to accredited investors only. U.S. Wireless relied on an exemption from registration pursuant to Section 4(2) of the Securities Act to effect the transaction.  No commissions were paid.

ITEM 6.  Exhibits and Reports on Form 8-K

Exhibit #  

Title

Location

Exhibit 31  

Certification of Chief Executive Officer and Chief Financial           

Attached

Officer pursuant to Section 302 of the Sarbanes- Oxley Act of 2002

Exhibit 32

Certification of Chief Executive Officer and Chief Financial

Attached

Officer pursuant to Section 906 of the Sarbanes- Oxley Act of 2002*

21

*The Exhibit attached to this Form shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to liability under that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

 (b)  Reports on Form 8-K:

The following reports were filed on Form 8-K for the quarter for which this report is filed.

Form

Date

Description

8-K

August 24, 2005

Item 2.01  Completion of Acquisition or Disposition of Assets

Item 5.02  Departure of Directors or Principal Officers

Item 9.01  Financial Statements and Exhibits

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SIGNATURES

In accordance with the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

US WIRELESS ONLINE, INC.

Date: November 14, 2005

/s/ Rick E. Hughes          

Rick E. Hughes

CEO and CFO

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EX-31

Exhibit 31

Certification Pursuant to pursuant to Rule 13a-14(a) or Rule 15d-14(a)

of the Securities Exchange Act of 1934, as amended

I, Rick E. Hughes Chief Executive Officer and Chief Financial Officer of US Wireless Online, Inc. (the "Company"), certify that:

1. I have reviewed this quarterly report on Form 10-QSB of the Company;

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

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

4. As the registrant's certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and I have:

a)

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

b)

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)

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

d)

disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the  registrant's internal control over financial reporting.

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

a)

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

b)

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

/s/ Rick E. Hughes                                 

Rick E. Hughes

President, Chief Executive Officer and

Chief Financial Officer

Date: November 14, 2005

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of US Wireless Online, Inc. a Nevada corporation (the “Company”), on Form 10-QSB for the quarterly period ending September 30, 2005 as filed with the Securities and Exchange Commission (the “Report”), I, Rick E. Hughes, Chief Executive Officer and Chief Financial Officer of the Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350), that to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ Rick E. Hughes                               

Rick E. Hughes

President, Chief Executive Officer and

Chief Financial Officer

Date: November 14, 2005