What changed in this filing

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Item 1. Business

2023-04-17 compared with 2022-04-14 · 201 added, 220 removed, 135 unchanged (76% of the section changed)

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Company, which owned and operated a home center in League City, Texas, about 30 miles southeast of downtown Houston, Texas.

we ceased these operations, and the secured lenders took possession our assets.

we ceased these operations, and the secured lenders took possession of our assets.

We changed our name to “Dala Petroleum Corp.”

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Certificate of Incorporation with the State of Delaware, which removed all of the designations of our preferred stock from our Certificate

of Incorporation, while reserving our 50,000,000 authorized and unissued one mill ($0.01) par value shares of preferred stock for future

of Incorporation, while reserving our 50,000,000 authorized and unissued one cent ($0.01) par value shares of preferred stock for future

issuance as the Board of Directors may designate and approve.

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Effective December 18, 2017, we completed an Agreement

and Plan of Merger (the “KonaTel Merger Agreement”) with KonaTel, Inc., a Nevada corporation (the “KonaTel Nevada”),

under which KonaTel Nevada became our wholly owned subsidiary on the closing of the merger (the “KonaTel Nevada Merger”),

and we succeeded to the business operations of KonaTel Nevada.

and Plan of Merger (the “KonaTel Merger Agreement”) with KonaTel Nevada, under which KonaTel Nevada became our wholly owned

subsidiary on the closing of the merger (the “KonaTel Nevada Merger”), and we succeeded to the business operations of KonaTel

Effective February 7, 2018 (dated as of February 5,

2018), we entered into an Agreement for the Purchase and Sale of Membership Interest (the “PSMI”), with the transaction documents

being deposited in escrow on February 7, 2018, respecting the acquisition of 100% of the membership interest in IM Telecom, LLC, an Oklahoma

limited liability company, (doing business as “Infiniti Mobile”) (“IM Telecom” or “Infiniti Mobile), from

its sole owner, Trevan Morrow (“Mr.

The principal asset of IM Telecom, at that time, was a “Lifeline

Program” license of the Federal Communications Commission (“FCC”) (an FCC approved wireless Compliance Plan).

being deposited in escrow on February 7, 2018, respecting the acquisition of 100% of the membership interest in IM Telecom, doing business

as “Infiniti Mobile,” from its sole owner, Trevan Morrow (“Mr.

The principal asset of IM Telecom,

at that time, was a “Lifeline Program” license of the Federal Communications Commission (“FCC”) (an FCC approved

wireless Compliance Plan).

On August 9, 2018, we entered into an Asset Purchase

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other assets and liabilities.

Additional information on the Telecon Agreement can be accessed in Part IV, Item 15 hereof, under the heading

“Telecon Wireless Sale Current Report.”

Effective December 31, 2018, we completed an Agreement

and Plan of Merger with Apeiron Systems, Inc., a Nevada corporation (respectively, “Apeiron Systems” and the “Apeiron

Systems Merger Agreement”), under which Apeiron Systems became our wholly owned subsidiary on the closing of the merger (the “Apeiron

Systems Merger”).

We issued 7,000,000 shares of our common stock in exchange for all of the outstanding shares of common stock

of Apeiron Systems, to Apeiron Systems’ two (2) shareholders, Joshua Ploude (6,300,000 shares) and Vyacheslav Yanson (700,000 shares),

pro rata, in accordance with their respective equity interests in Apeiron Systems.

Closing conditions to the Apeiron Systems Merger Agreement

included, among other conditions, that the Apeiron Systems shareholders would have a $1.00 per share “Guaranteed Value” on

the KonaTel shares they received under the Apeiron

Systems Merger if the KonaTel shares do not trade

at or above $1.00 for ten (10) consecutive days during the period commencing on December 31, 2020, and ending December 31, 2021, on the

applicable trading market for our common stock during that period, and subject to such shares being continuously owned of record by the

Apeiron Systems shareholders, as outlined in Section 5.10 of the Apeiron Systems Merger Agreement.

This condition was fully satisfied

effective June 16, 2021.

See the Company’s 8-KA Current Report dated and filed with the SEC on that date and which is available

by Hyperlink in Part IV, Item 15.

and Plan of Merger with Apeiron Systems (the “Apeiron Systems Merger Agreement”), under which Apeiron Systems became our wholly

owned subsidiary on the closing of the merger (the “Apeiron Systems Merger”).

We issued 7,000,000 shares of our common

stock in exchange for all of the outstanding shares of common stock of Apeiron Systems, its two (2) shareholders, Joshua Ploude (6,300,000

shares) and Vyacheslav Yanson (700,000 shares), pro rata, in accordance with their respective equity interests in Apeiron Systems.

conditions to the Apeiron Systems Merger Agreement included, among other conditions, that the Apeiron Systems shareholders would have

a $1.00 per share “Guaranteed Value” on the KonaTel shares they received under the Apeiron Systems Merger, if the KonaTel

shares exchanged did not trade at or above $1.00 for ten (10) consecutive days during the period commencing on

December 31, 2020, and ending December 31, 2021, on the applicable trading market for our common stock during that period, and subject

to such shares being continuously owned of record by the Apeiron Systems shareholders, all as outlined in Section 5.10 of the Apeiron

Systems Merger Agreement.

This condition was fully satisfied effective June 16, 2021.

On April 14, 2020, our operating subsidiaries made

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All PPP loans were forgiven by the SBA in 2021.

On December 14, 2020, the shares of the Company’s

common stock were approved for up listing to the OTC Markets OTCQB® Venture Market (“OTCQB”).

OTCQB is a venture market

operated by the OTC Markets.

To be eligible for quotation on the OTCQB, companies must be current in their reporting obligations under

Section 13 or 15(d) of the Exchange Act and undergo an annual verification and management certification process.

Companies must also meet

a minimum bid price test and other financial conditions.

The OTC Markets is recognized by the SEC as a “Qualified Interdealer Quotation

System” (“IDQS”) under SEC Rule 15c2-11(e)(6);

and the OTCQB is an established public market that provides current public

information to investors that need to analyze, value and trade securities.

On December 14, 2020, the shares of our common stock

were approved for up listing to the OTC Markets OTCQB® Venture Market (“OTCQB Tier”).

OTCQB is a venture market operated

by the OTC Markets.

To be eligible for quotation on the OTCQB, companies must be current in their reporting obligations under Section

13 or 15(d) of the Exchange Act and undergo an annual verification and management certification process.

Companies must also meet a minimum

bid price test and other financial conditions.

The OTC Markets is recognized by the SEC as a “Qualified Interdealer Quotation System”

(“IDQS”) under SEC Rule 15c2-11(e)(6);

and the OTCQB is an established public market that provides current public information

to investors that need to analyze, value and trade securities.

On August 25, 2021, the Company filed a registration

statement with the SEC on Form S-8 to register 5,901,884 shares of its common stock underlying granted and unexercised employee incentive

stock options under its 2018 Incentive Stock Option Plan.

statement with the SEC on Form S-8 to register 5,901,884 shares of its common stock reserved for grant underlying the Company’s

2018 Incentive Stock Option Plan (year designation reflects a change to a calendar year end in 2017).

On June 14, 2022, we and our wholly owned

subsidiaries, Apeiron Systems and IM Telecom, entered into a Note Purchase Agreement (the “NPA”) with CCUR Holdings, Inc.,

a Delaware corporation (“CCUR”), as “Collateral Agent”;

and CCUR and Symbolic Logic, Inc., a Delaware corporation

(“Symbolic”), as “Purchasers,” along with a related Guarantee and Security Agreement (the “GSA”),

whereby the Company and its subsidiary companies pledged their assets (including the Company’s equity ownership of its subsidiaries)

to secure $3,150,000 (the “Principal Amount”) in debt financing payable in one (1) year (cannot be repaid prior to nine (9)

months), together with interest at the rate of 15% per annum (the “Interest Rate”), with two (2) successive six (6) month

optional extensions (the “Loan”).

For additional information on the NPA and related transactions, see our 8-K Current Report

dated June 14, 2022, and filed with the SEC on June 21, 2022, which is available by Hyperlink in Part IV, Item 15 hereof.

On July 7, 2022, the Company filed a registration

statement with the SEC on Form S-8 to register an additional 2,000,000 shares of its common stock reserved for grant underlying the Company’s

2018 Incentive Stock Option Plan.

On August 22, 2022, the Company filed a registration

statement with the SEC on Form S-8 to decrease its shares registered on Form S-8 by 1,500,000 shares;

and on March 20, 2023, filed a similar

amendment on Form S-8 to decrease the shares registered by 253,764 shares, leaving 6,148,120 remaining registered shares with 1,648,120

shares having been issued and 4,500,000 reserved shares for future issuance under granted or to be granted incentive stock options.

KonaTel Nevada was organized under the laws of the

State of Nevada on October 14, 2014, by its founder and then sole shareholder, D.

Sean McEwen, to conduct the business of a full-service

cellular provider that delivered cellular products and services to individual and business customers in various retail and wholesale

Sean McEwen, our current Chairman and CEO, to conduct

the business of a full-service cellular provider that delivered cellular products and services to individual and business customers in

various retail and wholesale markets.

Through its sales network, it provided these services nationwide.

In furtherance of its proposed business, on November 1, 2014,

it acquired most of the assets of Coast to Coast Cellular, Inc.

(“Coast to Coast”), including inventories, property, plant

and equipment and its customer list, all valued at approximately $950,000 net of liabilities in the approximate amount of $415,000;

on November 1, 2016, it acquired the assets of CS Agency LLC (“CS Agency”), consisting of contract rights related to the

cellular industry, in consideration of assuming liabilities of CS Agency in the approximate amount of $300,000.

With the completion of

the KonaTel Nevada Merger, we succeeded to the current and intended business operations of KonaTel Nevada.

On December 31, 2018, we acquired

Apeiron Systems (www.apeiron.io) (“Apeiron Systems” or “Apeiron”), which is also our wholly owned subsidiary.

Apeiron was organized in 2013 and is an international hosted services Communications Platform as a Service (“CPaaS”) provider

that designed, built, owns and operates its national private core network, supporting a suite of business communications services, all

accessible via proprietary Applications Programming Interfaces (“APIs”).

As an FCC licensed Internet Telephony Service Provider

(“ITSP”), Apeiron also holds an FCC numbering authority license.

Some of Apeiron’s hosted services include Voice over

IP (“VoIP”), cellular and Over-The-Top (“OTT”) telephony, SMS/MMS messaging and broadcast services, numbering

features, including Cloud IVRs, Voicemail, Fax, Call Recording and other services through local, toll-free and international phone numbers.

Supported by its national redundant network, Apeiron also provides public and private IP network services, including Multiprotocol Label

Switching (“MPLS”), Dedicated Internet and LTE Wireless WAN solutions.

In furtherance of its proposed

business, on November 1, 2014, it acquired most of the assets of Coast to Coast Cellular, Inc.

(“Coast to Coast”), including

inventories, property, plant and equipment and its customer list, all valued at approximately $950,000 net of liabilities in the approximate

amount of $415,000;

and on November 1, 2016, it acquired the assets of CS Agency LLC (“CS Agency”), consisting of contract

rights related to the cellular industry, in consideration of assuming liabilities of CS Agency in the approximate amount of $300,000.

With the completion of the KonaTel Nevada Merger, we succeeded to the current and intended business operations of KonaTel Nevada.

On December 31, 2018, we acquired Apeiron Systems

(www.apeiron.io).

Apeiron was organized in 2013 and is an international hosted services Communications Platform as a Service (“CPaaS”)

provider that designed, built, owns and operates its national private core network, supporting a suite of business communications services,

all accessible via proprietary Applications Programming Interfaces (“APIs”).

As an FCC licensed Internet Telephony Service

Provider (“ITSP”), Apeiron also holds an FCC numbering authority license.

Some of Apeiron’s hosted services include

Voice over IP (“VoIP”), cellular and Over-The-Top (“OTT”) telephony, SMS/MMS messaging and broadcast services,

numbering features, including Cloud IVRs, Voicemail, Fax, Call Recording and other services through local, toll-free and international

phone numbers.

Supported by its national redundant network, Apeiron also provides public and private IP network services, including Multiprotocol

Label Switching (“MPLS”), Dedicated Internet and LTE Wireless WAN solutions.

Apeiron’s cloud services include Information

Data Dips, Software-Defined Wide Area Networking (“SD-WAN”) and Internet of Things (“IoT”) data and device management.

Apeiron primarily distributes its services nationally through its website, its sales staff, independent sales agents, and Independent

Sales Organizations (“ISOs”).

Apeiron primarily distributes its services nationally through its website, its sales staff, independent sales agents and Independent Sales

Organizations (“ISOs”).

Apeiron Systems is headquartered in Johnstown, Pennsylvania,

where it has customer service and software engineering resources staffed.

Additional development resources are staffed out of Los Angeles,

CA, as well as in Europe and Asia.

On February 5, 2018, we entered into a purchase agreement

to acquire IM Telecom (www.infinitimobile.com), doing business as Infiniti Mobile (“IM Telecom” or “Infiniti Mobile”).

On October 23, 2018, the FCC approved our acquisition of IM Telecom, and on January 31, 2019, we completed the purchase of IM Telecom.

to acquire IM Telecom (www.infinitimobile.com).

On October 23, 2018, the FCC approved our acquisition of IM Telecom, and on January 31,

2019, we completed the purchase of IM Telecom.

IM Telecom operates as a wholly owned subsidiary of KonaTel.

It is an FCC licensed Eligible Telecommunications Carrier (“ETC”)

and is one of twenty-two (22) original FCC licensed wireless cellular resellers to hold an FCC approved Lifeline Compliance Plan since

2012, of which approximately twelve (12) license holders remain active today.

The FCC has not approved (granted) a new wireless reseller

Lifeline Compliance Plan since 2012.

As a licensed ETC, IM Telecom is currently authorized to distribute Lifeline subsidized mobile voice/data

service in nine (9) states.

In addition to Lifeline, IM Telecom is also an FCC licensed Emergency Broadband Benefit (“EBB”)

provider, authorized to distribute EBB subsidized high-speed mobile data service in the forty-eight (48) contiguous states plus Washington

It is an FCC licensed Eligible

Telecommunications Carrier (“ETC”) and is one of twenty-two (22) original FCC licensed wireless cellular resellers to hold

an FCC approved Lifeline Compliance Plan since 2012, of which approximately twelve (12) license holders remain active today.

not approved (granted) a new wireless reseller Lifeline Compliance Plan since 2012.

As a licensed ETC, IM Telecom is currently authorized

to distribute Lifeline subsidized mobile voice/data service in ten (10) states, which are Vermont, South Carolina, Georgia, Maryland,

Kentucky, Wisconsin, Oklahoma, California, New York and Nevada.

In addition to Lifeline, IM Telecom is also an FCC licensed Affordable

Connectivity Program (“ACP”) provider, authorized to distribute ACP subsidized high-speed mobile data service in the fifty

(50) states plus Washington D.C.

and Puerto Rico.

EBB is expected to be replaced by the Affordable Connectivity Program (“ACP”) in 2022 under new terms

and conditions.

Lifeline is an FCC program that provides subsidized, fixed or mobile telecommunications services to low-income Americans.

EBB is an FCC program that provides subsidized

high-speed wireless data services to low-income Americans.

IM Telecom distributes Lifeline and EBB services under its Infiniti Mobile brand name through its website, sales staff, retail location

IM Telecom also offers non-Lifeline and non-EBB services throughout the United States.

Apeiron Systems is headquartered in Los Angeles, California.

It also has some management staff in Plano, Texas, customer service and software engineering resources staffed in Johnstown, Pennsylvania

and software engineering services staffed in Europe and Asia.

IM Telecom is headquartered in Plano, Texas, and operates a retail operation

in Tulsa, Oklahoma.

We are headquartered in Plano, Texas, shared with

IM Telecom’s offices.

Apeiron Systems has thirteen (13) full-time employees;

IM Telecom has four (4) full-time employees and two

(2) part-time employees;

and we have four (4) full-time employees.

Lifeline is an FCC program that provides subsidized, fixed or mobile telecommunications

services to low-income Americans.

ACP is an FCC program that provides subsidized high-speed wireless data services to low-income Americans.

IM Telecom distributes Lifeline and ACP services under its Infiniti Mobile brand name through its website, sales staff, retail locations

IM Telecom also offers non-Lifeline and non-ACP services throughout the United States.IM Telecom has a US-based customer support

center located in Atmore, Alabama.

IM Telecom is headquartered in Plano, Texas, and has

a warehouse operation in Tulsa, Oklahoma, and a customer service center in Atmore, Alabama.

We are headquartered in Plano, Texas.

Apeiron Systems

has eight (8) full-time employees;

IM Telecom has (23) full-time employees and two (2) part-time employees;

and we have four (4) full-time

Principal Products

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services, across our two wholly owned subsidiaries, Apeiron Systems and IM Telecom, include our CPaaS suite of services (SIP/VoIP, SMS/MMS),

wholesale and retail mobile voice and mobile data IoT services, wholesale voice termination services, and our ETC and EBB subsidized services

wholesale and retail mobile voice and mobile data IoT services, wholesale voice termination services, and our ETC and ACP subsidized services

for low-income Americans.

Except for our ETC Lifeline services distributed in up to nine (9) states and our EBB services distributed in

the forty-eight (48) contiguous states, Washington D.C.

and Puerto Rico, our Apeiron Systems’ products and services are available

worldwide and subject to U.S., international and local/national regulations.

Except for our ETC Lifeline services distributed in up to ten (10) states and our ACP services distributed in

the fifty (50) states, as well as Washington D.C.

and Puerto Rico, our Apeiron Systems’ products and services are available worldwide

and subject to U.S., international and local/national regulations.

We generate revenue from

two (2) primary sources, Hosted Services and Mobile Services:

· Our Hosted Services include a suite of hosted CPaaS services within the

Apeiron Systems’ cloud platform, including Cloud IVRs, Voicemail, Fax, Call Recording and other services provided with local, toll-free

and international phone numbers.

Apeiron also delivers public and private IP network services from its national redundant network backbone,

including MPLS, Dedicated Internet and LTE Wireless WAN solutions.

Additionally, Apeiron’s Cloud Services include Information Data

Dips, SD-WAN and IoT data and device management.

These Hosted Services are marketed nationally and internationally through the Apeiron

website, its sales staff, independent sales agents and ISOs.

· Our Mobile Services include retail and wholesale cellular voice/text/data

services and IoT mobile data services through our subsidiaries Apeiron Systems and IM Telecom.

Mobile voice/text/data and IoT mobile data

services are supported by a blend of reseller agreements with select national wireless carriers and national wireless wholesalers.

communications service reseller typically does not own the wireless network infrastructure over which services are provided to its customers.

Mobile voice/text/data and mobile data solutions are generally sold as traditional post-paid service plans that may include voice/text/data

or wireless data only plans.

Sometimes equipment is provided, which can include, but is not limited to, phones, tablets, modems, routers

and accessories.

Also included in our Mobile Services segment is the distribution of government subsidized mobile voice service and mobile

data service by IM Telecom under its Infiniti Mobile brand and FCC license to low-income American households that qualify for the FCC’s

Lifeline mobile voice service program and/or the FCC’s temporary EBB mobile data program, with EBB to eventually be replaced by

FCC’s ACP program in 2022.

Even though government programs like Lifeline have existed since 1985, these programs, along with newer

programs like the temporary EBB program and future ACP program, are subject to change and may have a material impact on our Mobile Services

business if changed, reduced or eliminated.

Our Hosted Services include a suite of hosted CPaaS services within Apeiron Systems’ cloud platform, including Cloud IVRs, Voicemail, Fax, Call Recording and other services provided with local, toll-free and international phone numbers.

Apeiron also delivers public and private IP network services from its national redundant network backbone, including MPLS, Dedicated Internet and LTE Wireless WAN solutions.

Additionally, Apeiron’s Cloud Services include Information Data Dips, SD-WAN and IoT data and device management, of which IoT provides device connectivity via wireless 4G/5G.

These Hosted Services are marketed nationally and internationally through the Apeiron website, its sales staff, independent sales agents and ISOs.

Our Mobile Services include retail and wholesale cellular voice/text/data services and IoT mobile data services through our subsidiaries Apeiron Systems and IM Telecom.

Mobile voice/text/data and IoT mobile data services are supported by a blend of reseller agreements with select national wireless carriers and national wireless wholesalers.

A wireless communications service reseller typically does not own the wireless network infrastructure over which services are provided to its customers.

Mobile voice/text/data and mobile data solutions are generally sold as traditional post-paid service plans that may include voice/text/data or wireless data only plans.

Sometimes equipment is provided, which can include, but is not limited to, phones, tablets, modems, routers and accessories.

Also included in our Mobile Services segment is the distribution of government subsidized mobile voice service and mobile data service by IM Telecom under its Infiniti Mobile brand and FCC license to low-income American households that qualify for the FCC’s Lifeline mobile voice service program and/or the FCC’s ACP mobile data program.

Even though government programs like Lifeline have existed since 1985, these programs, along with newer programs like the ACP program, are subject to change and may have a material impact on our Mobile Services business if changed, reduced or eliminated.

Distribution Methods of the Products or Services

We primarily distribute our

Hosted Services through our website, sales staff, independent sales agents and ISOs.

We primarily distribute our Mobile Services through

our website, sales staff, retail location, independent sales agents and ISOs.

In early 2021, we increased our Mobile Service online marketing

effort and by the end of 2021, online mobile service distribution increased by approximately 320% compared to 2020 online distribution.

Hosted Services through our website, sales staff, master distribution agreements and ISOs (independent sales agents).

We primarily distribute

our Mobile Services through our website, sales staff, retail locations and ISOs.

Since 2021, we have continued to increase our Mobile

Service online marketing efforts to supplement alternative distribution channel growth.

Sources and Availability of Raw Materials

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wireless carrier.

Carriers can include Verizon, T-Mobile, Sprint, and AT&T.

Carriers can include Verizon, T-Mobile and AT&T.

Wholesalers can include Prepaid Wireless Group (“PWG”)

and Telispire.

Wireless resellers like us traditionally do not own

the wireless infrastructure over which services are provided.

Wireless resellers, like us, traditionally do not

own the wireless infrastructure over which services are provided.

We purchase services from the following sources:

Verizon voice, text and data service.

Telispire, through a contract

with us, has set per unit pricing for voice, text, and data wireless services.

Pricing per unit is in the form of a monthly recurring

charge (“MRC”) that may or may not include minutes of use, text units or data units.

Additional data units are available for

AT&T voice, text or data service and AT&T IoT service

under a contract with us, has set “unit based” pricing for voice, text, and data and IoT wireless services.

Pricing per unit

is in the form of an MRC that may or may not include minutes of use, text units or data units.

Additional data units are available for

Verizon voice, text and data services are provided through master distribution partners of Verizon.

The contract we hold with distribution partners has set per unit pricing for voice, text and data wireless services.

Pricing per unit is in the form of a monthly recurring charge (“MRC”) that may or may not include minutes of use, text units or data units.

Additional data units are available for purchase;

AT&T voice, text or data service and

AT&T IoT service under a contract with us, has set “unit based” pricing for voice, text, and data and IoT wireless services.

Pricing per unit is in the form of an MRC that may or may not include minutes of use, text units or data units.

Additional data units

are available for purchase;

Verizon Wireless VPP, a Verizon IoT product:

Verizon VPP, also through a

contract with us, has set per unit pricing for IoT wireless services.

Pricing per unit is in the form of an MRC that includes data units

with defined over plan use pricing;

Sprint voice, text or data service.

Sprint, through a contract with

us, has set pricing for bundled voice, text and data wireless services.

Pricing bundles are in the form of an MRC that include minutes

of use, text units or data units.

Bundled plans include unlimited talk, text and a set amount of data.

Larger data plans are available

for purchase for consumers requiring larger data packages;

· Prepaid Wireless Group (“PWG”):

T-Mobile voice, text or data

Lifeline service.

PWG, through a contract with us, has set pricing for bundled voice, text and data wireless services.

Pricing bundles

are in the form of an MRC that include minutes of use, text units or data units.

Larger data plans are available for purchase for consumer

requiring larger voice and data packages.

Verizon VPP, also through a contract with us, has set per unit pricing for IoT wireless services.

Pricing per unit is in the form of an MRC that includes data units with defined over plan use pricing;

T-Mobile voice, text or data Lifeline services are provided through master distribution partners of T-Mobile.

The contract we hold has set pricing for bundled voice, text and data wireless services.

Pricing bundles are in the form of an MRC that include minutes of use, text units or data units.

Larger data plans are available for purchase for consumer requiring larger voice and data packages.

Patents, Trademarks, Licenses, Franchises,

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licensed ETC and is one of the original twenty-two (22) FCC licensed wireless cellular resellers to hold an FCC approved wireless Lifeline

Compliance Plan in the United States since 2012, of which approximately twelve (12) license holders remain active today.

Compliance Plan in the United States (as of 2012), of which approximately twelve (12) license holders remain active today.

As a licensed

ETC, IM Telecom is currently authorized to distribute Lifeline subsidized mobile voice/data service in nine (9) states.

ETC, IM Telecom is currently authorized to distribute Lifeline subsidized mobile voice/data service in ten (10) states.

IM Telecom is

also an FCC licensed EBB carrier, authorized to distribute EBB subsidized mobile data services in the forty-eight (48) contiguous states

and Washington D.C.

also an FCC licensed ACP carrier, authorized to distribute ACP subsidized mobile data services in the fifty (50) states as well as Washington

and Puerto Rico.

Infiniti Mobile also offers non-Lifeline and non-EBB services.

Infiniti Mobile also offers non-Lifeline and non-ACP services.

We hold a United States Patent

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The telecommunications industry is highly competitive.

Our primary cellular competitors include other resellers and national carriers, such as AT&T, Verizon, Sprint, and T-Mobile.

national cellular carriers are facility-based, are significantly larger than us and enjoy trade name and trademark public recognition,

as well as greater resources, scale, and competitive advantages, among other substantial factors, as compared to us.

In addition, our

cellular competitors also include numerous smaller regional carriers, existing MVNOs and ETCs, such as Metro PCS, Cricket Wireless, TracFone

Wireless, QLink Wireless, TruConnect, and Assurance Wireless, many of which offer or may offer cellular, mobile data, Lifeline and EBB

services along with no-contract postpaid and prepaid service plans.

Our CPaaS competitors include, but are not limited to, Twilio, Plivo,

Bandwidth, Thinq, VoIP Innovations, Telnyx, Coredial, Vonage/Nexmo, CLX Comm, Genband Kandy, Tropo, Telestax, 2600Hz, and Signal Wire.

Competitive factors within the telecommunications industry include pricing, market saturation, service and product offerings, customer

experience, network investment and quality, development and deployment of technologies, and regulatory changes.

Some competitors have

shown a willingness to use aggressive pricing as a source of differentiation.

Other competitors have sought to add ancillary services,

like mobile video, to enhance their offerings.

Taken together, the competitive factors we face continue to put pressure on margins as

companies compete to retain their current customer base and continue to add new developments, many proprietary or patented, and customers.

Our primary cellular competitors include other resellers and national carriers, such as AT&T, Verizon and T-Mobile.

These national

cellular carriers are facility-based, are significantly larger than us and enjoy trade name and trademark public recognition, as well

as greater resources, scale and competitive advantages, among other substantial factors, as compared to us.

In addition, our cellular

competitors also include numerous smaller regional carriers, existing MVNOs and ETCs, such as Metro PCS, Cricket Wireless, TracFone Wireless,

QLink Wireless, TruConnect and Assurance Wireless, many of which offer or may offer cellular, mobile data, Lifeline and ACP services,

along with no-contract postpaid and prepaid service plans.

Our CPaaS competitors include, but are not limited to, Twilio, Plivo, Bandwidth,

Thinq, VoIP Innovations, Telnyx, Coredial, Vonage/Nexmo, CLX Comm, Genband Kandy, Tropo, Telestax, 2600Hz and Signal Wire.

factors within the telecommunications industry include pricing, market saturation, service and product offerings, customer experience,

network investment and quality, development and deployment of technologies and regulatory changes.

Some competitors have shown a willingness

to use aggressive pricing as a source of differentiation.

Other competitors have sought to add ancillary services, like mobile video,

to enhance their offerings.

Taken together, the competitive factors we face continue to put pressure on margins as companies compete to

retain their current customer base and continue to add new developments, many proprietary or patented, and customers.

Need for any Governmental Approval of Principal

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In 1985, during the Reagan administration, the FCC established the Lifeline

Assistance program through generic powers afforded the FCC under Communications Act of 1934.

Assistance program through generic powers afforded the FCC under the Communications Act of 1934.

Cellular service was added to the Lifeline

program in 2009.

Approximately nineteen (19) ETCs hold an FCC approved wireless reseller Lifeline Compliance Plan, but only about twelve

(12) are active today.

The FCC has not approved any new wireless reseller Lifeline Compliance Plans since 2012.

Approximately one-half

of our future gross revenues may come from government subsidized mobile voice and mobile data service.

Approximately nineteen (19) of the original twenty-two (22) ETCs still hold an FCC approved wireless reseller Lifeline

Compliance Plan, but only about twelve (12) are active today.

The FCC has not approved any new wireless reseller Lifeline Compliance

Plans since 2012.

We expect our future gross revenues to mainly come from government subsidized mobile voice and mobile data services.

Existing and Probable Government Regulation to Our Current and Intended

The FCC has a number of complex requirements and proceedings

The FCC has several complex requirements and proceedings

that affect our operations and that could increase our costs or diminish our revenues.

For example, the FCC has rules regarding provision

of 911 and E-911 services, porting telephone numbers, roaming, disabilities access, privacy and cyber security, consumer protection, and

of 911 and E-911 services, porting telephone numbers, roaming, disabilities access, privacy and cybersecurity, consumer protection, and

the universal service and Lifeline programs, including eligibility, reimbursement and program requirements.

Many of these and other issues

are being considered in ongoing

proceedings, and we cannot predict whether or how

such actions will affect our business, financial condition, or results of operations.

Our ability to provide services and generate revenues

could be harmed by adverse regulatory action or changes to existing laws and regulations.

In addition, regulation of companies that offer

competing services can impact our business indirectly.

are being considered in ongoing proceedings, and we cannot predict whether or how such actions will affect our business, financial condition

or results of operations.

Our ability to provide services and generate revenues could be harmed by adverse regulatory action or changes

to existing laws and regulations.

In addition, regulation of companies that offer competing services can impact our business indirectly.

Smaller Reporting Company

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13 of the Exchange Act, and we are subject to the disclosure requirements of Regulation S-K of the SEC, as a “smaller reporting

company.” That designation will relieve us of some of the informational requirements of Regulation S-K and Article 8

of Regulation S-X of the SEC.

company.” That designation relieves us of some of the informational requirements of Regulation S-K and Article 8 of Regulation

S-X of the SEC.

Emerging Growth Company

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of the fifth anniversary of our initial registered public offering.

During our “emerging growth company” designation we did

not utilize any financial statement waivers as a result of that designation.

During our emerging growth company designation, we did not utilize

any financial statement waivers available to us as a result of that designation.

Sarbanes/Oxley Act

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creates guidelines for audit committee members’

appointment, compensation and oversight of the work of public companies’ auditors;

appointments, compensation and oversight of the work of public companies’ auditors;

management assessment of our internal controls;

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to a written consent will require us to provide our shareholders with the information outlined in Schedules 14A or 14C of Regulation 14;

preliminary copies of this information must be submitted to the SEC at least 10 days prior to the date that definitive copies of this

information are forwarded to our shareholders.

preliminary copies of this information must be submitted to the SEC at least ten (10) days prior to the date that definitive copies of

this information are forwarded to our shareholders.

We are required to file annual reports on Form 10-K

and quarterly reports on Form 10-Q with the SEC on a regular basis, and are required to timely disclose certain material events (e.g.,

changes in corporate control;

acquisitions or dispositions of a significant amount of assets other than in the ordinary course of business;

and bankruptcy) in a Current Report on Form 8-K.

entry into a definitive material agreement, changes in corporate control, acquisitions or dispositions of a significant amount of assets

other than in the ordinary course of business, bankruptcy and receivership filings and the sale of in excess of five percent (5%) of our

outstanding securities, among various other material matters) in a Current Report on Form 8-K.

See SEC Form 8-K for a more complete description

of the type of material events required to be disclosed.

Number of Total Employees and Number of Full-Time

Across our companies, we have a total of twenty-three

Across our companies, we have a total of thirty-seven

(37) employees;

twenty-one (21) full-time employees and two (2) part-time employees.

We have three (3) wholly owned operating subsidiaries:

KonaTel, Inc., a Nevada corporation;

IM Telecom, LLC (d/b/a Infiniti Mobile) an Oklahoma limited liability company;

thirty-five (35) full-time employees and two (2) part-time employees.

We have three (3) wholly owned subsidiaries:

and Apeiron Systems.

Inc., a Nevada corporation.

Our subsidiary KonaTel, Inc., a Nevada corporation, has remained inactive since the start of 2021.

Our subsidiary KonaTel Nevada, has remained inactive since early 2021.

Additional Information

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or registration statements that we have previously filed electronically with the SEC at its Internet site at www.sec.gov in the Edgar

Archives of the SEC.

Archives of the SEC or in our website at konatel.com.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business