What changed in this filing

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Item 1. Business

2024-04-01 compared with 2023-04-17 · 203 added, 122 removed, 214 unchanged (60% of the section changed)

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under the laws of the State of Nevada on May 24, 1984.

A subsidiary in the name “Westcott Products Corporation” was

organized by us under the laws of the State of Delaware on June 24, 1986, for the purpose of changing our name and domicile to the State

On June 27, 1986, we merged with the Delaware subsidiary, with the survivor being Westcott Products Corporation, a Delaware

A subsidiary in the name “Westcott Products Corporation” was organized

by us under the laws of the State of Delaware on June 24, 1986, for the purpose of changing our name and domicile to the State of Delaware.

On June 27, 1986, we merged with the Delaware subsidiary, with the survivor being Westcott Products Corporation, a Delaware corporation.

At that time, all of our prior operations were conducted through Lee Building Products and T.

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 of our assets.

Kilgore & Company, which owned and

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

During 1990, we ceased these operations,

and the secured lenders took possession of our assets.

We changed our name to “Dala Petroleum Corp.”

on August 29, 2014;

and then to “KonaTel, Inc.” on February 5, 2018, following the closing of two respective mergers that

are discussed below.

On March 11, 2000, our Board of Directors began the

process of re-entering the development stage, and on June 2, 2014, we completed a merger with Dala Petroleum Corp., a Nevada corporation

(respectively, “Dala Nevada” and the “Dala Merger”).

Dala Nevada was wholly owned by Chisholm Partners II, LLC,

a Louisiana limited liability company (“Chisholm II”).

We operated as an early-stage oil exploration company focused on our

leased acreage acquired by Dala Nevada until 2016, when Chisholm II returned a total of 8,567,800 shares of the 10,000,000 shares of our

common stock exchanged under the Dala Merger to us for cancellation in exchange for our assignment of approximately 55,000 acres, more

or less, of our leased acreage or approximately 68.75% of our total holdings, to Chisholm II.

All of our remaining oil and gas leasehold

interests, comprising leases covering approximately 7,489 and 403 acres, more or less, expired in 2017 and 2018, respectively.

on August 29, 2014, after re-entering the development stage and the completion of a merger with our newly formed and wholly owned subsidiary,

Dala Acquisition Corp., a Nevada corporation (respectively, “Dala Acquisition” and the “Dala Merger”), on June

Dala Nevada was wholly owned by Chisholm Partners II, LLC, a Louisiana limited liability company (“Chisholm II”).

We operated as an early-stage oil exploration company focused on our leased acreage acquired in the Dala Merger until 2016, when Chisholm

II returned a total of 8,567,800 shares of the 10,000,000 shares of our common stock exchanged under the Dala Merger to us for cancellation

in exchange for our assignment of approximately 55,000 acres, more or less, of our leased acreage or approximately 68.75% of our total

leased acreage, to Chisholm II.

All of our remaining oil and gas leasehold interests, comprising leases covering approximately 7,489 and

403 acres, more or less, expired in 2017 and 2018, respectively.

On July 20, 2017, pursuant to a Common Stock Purchase

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issuance as the Board of Directors may designate and approve.

See Part IV, Item 15, Exhibit 3(i).

Effective December 18, 2017, we completed an Agreement

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, 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).

and Plan of Merger (the “KonaTel Merger Agreement”) with our newly formed wholly owned subsidiary, Dala Subsidiary Corp.,

a Nevada corporation (“Dala Nevada”), under which KonaTel, Inc., a Nevada corporation (“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 comprised of a full service cellular provider that delivered cellular products and services to individual and business

customers in various retail and wholesale markets nationwide through its sales network, and we changed our name to “KonaTel, Inc.”

on February 5, 2018.

Effective February 7, 2018, and 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,

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”),

which was an FCC approved wireless Compliance Plan.

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

Agreement (the “Telecon Wireless Agreement”) with Telecon Wireless Resources, Inc., a New York corporation (the “Telecon

Agreement (the “Telecon Wireless Agreement”) with Telecon Wireless Resources, Inc., a New York corporation (“Telecon

Wireless”), whereby we sold various assets, including furniture, fixtures, equipment, account receivable and a customer list, among

other assets and liabilities.

other assets and liabilities, to Telecon Wireless.

Effective December 31, 2018, we completed an Agreement

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

loan applications to participate in the Small Business Administration’s (the “SBA”) Paycheck Protection Program (the

“PPP”) created under the “Cares Act” as a result of the COVID-19 pandemic.

On April 15, 2020, the loan applications

of Apeiron Systems, IM Telecom and KonaTel Nevada were approved and loan proceeds in the amounts of $101,800, $20,900 and $186,300, respectively,

were received.

We followed all prescribed loan forgiveness guidelines provided by our local bank and the SBA by using these loan proceeds

to fund employee payroll through the 60-day period ending on June 15, 2020.

All PPP loans were forgiven by the SBA in 2021.

and Plan of Merger with Apeiron Systems (the “Apeiron Systems Merger Agreement”) and under which we exchanged 7,000,000 shares

of our common stock for all of the outstanding shares of Apeiron Systems.

Apeiron Systems became our wholly owned subsidiary on the closing

of the merger (the “Apeiron Systems Merger”).

Apeiron Systems was organized in 2013 as a provider of a suite of real-time

business communications services that included voice, messaging, network connectivity and platform services.

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 reserved for grant underlying the Company’s

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

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

OTCQB is a venture market operated by 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

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.

On August 25, 2021, we filed a registration statement

with the SEC on Form S-8 to register 5,901,884 shares of our common stock reserved for grants underlying our 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

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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.

to secure $3,150,000 (the “Principal Amount”) in debt financing payable in one (1) year (to 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 “CCUR Loan”).

On June 1, 2023, we entered into a “First Amendment

to the NPA” with CCUR and Symbolic.

The purpose of the amendment was to add further growth capital to the Company in the form of

“Delayed Draw Notes” in an aggregate principal amount of up to $2,000,000;

and in consideration therefor, we provided additional

collateral for the NPA.

See our 8-K Current Report dated June 14, 2022, filed with the SEC on June 21, 2022, and our 8-KA Current

Report dated June 14, 2022, filed with the SEC on June 7, 2023, for additional information on the CCUR Loan.

These Current Reports are

available by Hyperlink in Part IV, Item 15 hereof, and are incorporated herein by reference.

On July 7, 2022, we filed a registration statement

with the SEC on Form S-8 to register an additional 2,000,000 shares of our common stock reserved for grants underlying our 2018 Incentive

Stock Option Plan.

On August 22, 2022, we filed an amendment to our registration

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

and on March 20, 2023, we filed

a similar amendment on Form S-8 to decrease our shares registered on Form S-8 by 253,764 shares, then leaving 6,148,120 remaining registered

shares, with 1,648,120 shares having been issued and 4,500,000 shares being reserved for future issuance under outstanding grants or to

be granted incentive stock options.

On January 24, 2023, we entered

into a non-material Membership Interest Purchase Agreement to acquire 100% of Tempo Telecom, LLC, a Georgia limited liability company,

an Eligible Telecommunications Carrier (“ETC”), authorized to provide Lifeline services in twenty-one (21) states (respectively,

the “Tempo Purchase Agreement” and “Tempo”), the closing of which is subject to the approval of the FCC and applicable

state and other governmental agencies, among other conditions.

On April 6, 2023, pursuant

to a Purchase of Contract Rights Agreement between the Company and Insight Mobile, Inc., a Delaware corporation (respectively, the “Insight

Mobile Agreement” and “Insight Mobile”), we and Insight Mobile executed and delivered an Assumption of Membership Interest

Purchase Agreement (the “Assignment Agreement”), which is being held in escrow by counsel for Insight Mobile (the “Escrow

Agent”) pending satisfaction of all conditions to the Closing of the Tempo Purchase Agreement, and whereby Insight Mobile has agreed

to pay us the “Purchase Price” of $4,500,000 for our “Contract Rights” under the Tempo Purchase Agreement.

additional information on the Insight Mobile Agreement and the Assignment Agreement, see our 8-K Current Report dated April 6, 2023, filed

with the SEC on April 17, 2023, which is Hyperlinked in Part IV, Item 15, below, and is incorporated herein by reference.

On December 8, 2023, we filed an additional

registration statement on Form S-8 to increase the number of shares of our common stock available for issuance under our 2018 Incentive

Stock Option Plan by 1,700,000 shares.

This amendment resulted in 7,848,120 registered shares equaling 1,748,120 shares issued and 6,100,000

reserved shares remaining for future issuance.

Effective December

18, 2023, we and IM Telecom, as the “Purchasers,” entered into an Installment Sale Agreement (the “Installment Sale

Agreement”) with ACP Financing VII Limited Liability Company, a Texas limited liability company (“ACP Financing”), as

the “Seller,” pursuant to which the Seller agreed to purchase new and refurbished cellular devices for distribution through

the Purchasers’ distribution network to Affordable Connectivity Program Federal Lifeline and California Lifeline eligible consumers,

such devices operating on 4G or better technology platforms or any such other consumer technology equipment upon the mutual agreement

of the Seller and the Purchasers (the “Devices”), and to sell the Devices

to the Purchasers.

It is intended that this Installment Sale Agreement will be utilized by KonaTel following the payment of all outstanding

amounts owed to ACP Financing.

For additional information on the Installment Sale Agreement, see our 8-K Current Report dated

December 18, 2023, filed with the SEC on December 22, 2023, which is Hyperlinked in Part IV, Item 15, below, and is incorporated herein

by reference.

On November 10, 2023, Apeiron

Systems entered into a five (5) year agreement with Viva-US Telecommunications, Inc.

(“Viva-US”), as the exclusive supplier

of wholesale cellular voice & data, messaging, international call termination, smart SIM (“Subscriber Identity Module”),

and other telecommunications services.

Apeiron Systems will provide these services through its CPaaS (“Communication Platform as

a Service”) cloud platform.

Viva-US is a US MVNO (“Mobile Virtual Network Operator”) and part of the Balesia Technologies,

group of companies operating MNOs (“Mobile Network Operator”) and MVNOs throughout North and South America, supporting

over three million customers in Bolivia, Mexico and Argentina.

Subsequent to December 31, 2023

Purchase Agreement Notice of Extension

On January 23, 2024, we exercised

our rights under Section 1.07 of the referenced Tempo Purchase Agreement regarding a “Notice of Extension” of Closing Condition-Governmental

Approvals, seeking an extension of 180 days for closing or such longer period as may be required to satisfy the required Governmental

Approvals to Closing.

Excess Purchase Agreement

and Related Agreements

On January 22,

2024 (the “Effective Date”), KonaTel and IM Telecom entered into a Membership Interest Purchase Agreement (the “Excess

Purchase Agreement”) with Excess Telecom, Inc., a Nevada corporation (“Excess”), pursuant to which KonaTel conveyed

49% of its Membership Interest in IM Telecom to Excess on the “Initial Closing Date”

in consideration of the sum of $10,000,000, and will convey the remaining 51% of the Membership Interest in IM Telecom to Excess for the

sum of $100.00 on the Final Closing.

The Final Closing is conditioned upon obtaining the necessary federal and state governmental approvals

for a change in control of IM Telecom (the “Approvals”), among other customary closing conditions.

In the event that Excess

is unable to procure the Approvals, Excess may, in its sole discretion, wait for the Approvals without any deadline or outside date;

assign its rights and interests under the Excess Purchase Agreement and related transaction documents to any third party.

If on or before

December 31, 2024, the ACP Connectivity Program is renewed by the United States Congress for a duration of greater than four (4) months

(the “ACP Renewal Condition”), Excess will pay KonaTel an additional sum of $5,000,000 (the “ACP Renewal Earnout).

ACP Connectivity Program is an FCC benefit program that helps ensure that low income households can afford broadband for various uses

(respectively, the “ACP Connectivity Program” or “ACP”).

The parties also entered into a Management Services Agreement

governing the management of the business of IM Telecom to be effective until the earlier of the Final Closing or ninety-nine (99) years

and whereby IM Telecom and Excess will be managing IM Telecom until final regulatory approval;

and a Master Distribution Agreement whereby

KonaTel, doing business as “Infiniti Mobile,” a tradename of IM Telecom that was excluded from the Excess Purchase Agreement,

will be a master distributor of IM Telecom’s wireless services, products, Lifeline services, ACP services to potential customers

and such other ancillary services relating to Lifeline and ACP services offered to KonaTel’s customers under the Licenses held by

IM Telecom (the “Services”), the term of which will commence upon the Final Closing and continue for a period of not less

than ten (10) years.

The current employees of IM Telecom will novate to employees of KonaTel’s under these agreements.

The CCUR Loan and the total liability of KonaTel under

the ACP Financing Installment Sale Agreement, which are referenced above, were paid in full on the Initial Closing Date of the Excess

Purchase Agreement.

The total payoff amount for the CCUR Loan was $3,681,660, inclusive of unpaid interest and legal fees.

The total payoff

amount under the ACP Finance Installment Sale Agreement was $1,462,345.

For additional information on the Excess Purchase

Agreement and related agreements, see our 8-K Current Report dated January 22, 2024, filed with the SEC on January 30, 2024, which is

Hyperlinked in Part IV, Item 15, below, and is incorporated herein by reference.

The referenced

Current Report and related agreements that are attached to this Current Report should be fully considered in reviewing the foregoing summary.

KonaTel Nevada was organized under the laws of the

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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.

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

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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.

As a licensed ETC, IM Telecom is also an FCC licensed

Affordable Connectivity Program (“ACP”) provider, authorized to distribute ACP subsidized high-speed Lifeline subsidized mobile

voice/data service in eleven (11) states, which are Vermont, South Carolina, Georgia, Maryland, Kentucky, Wisconsin, Oklahoma, California,

New York, Pennsylvania and Nevada.

In addition to Lifeline, IM Telecom is also an FCC approved ACP provider authorized to distribute ACP

subsidized high-speed mobile data service in the fifty (50) states, Washington D.C.

and Puerto Rico.

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.

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 and ISOs.

IM Telecom also offers non-Lifeline and non-ACP services throughout the United

IM Telecom has a US-based customer support center located in Atmore, Alabama.

IM Telecom is headquartered in Plano, Texas, and has

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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

Apeiron Systems has eight (8) full-time employees;

IM Telecom has (22) full-time employees and one (1) part-time employee;

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

Principal Products

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Our principal products and

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 ACP subsidized services

for low-income Americans.

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.

services, across two of our 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 ACP subsidized

services for low-income Americans.

Except for our ETC Lifeline services distributed in up to eleven (11) 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

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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.

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 any change, reduction or elimination may have a material impact on our Mobile Services business.

Distribution Methods of the Products or Services

We primarily distribute our

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.

Hosted Services through our website, sales staff, master distribution agreements and ISOs.

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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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.

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

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As a licensed

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

ETC, IM Telecom is currently authorized to distribute Lifeline subsidized mobile voice/data service in eleven (11) states.

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

Washington D.C.

and Puerto Rico.

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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.

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

Existing and Probable Government Regulation to Our Current and Intended

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We are also subject to the Sarbanes-Oxley Act of 2002.

Sarbanes/Oxley Act created a strong and independent accounting oversight board to oversee the conduct of auditors of public companies

The Sarbanes/Oxley Act created a strong and independent accounting oversight board to oversee the conduct of auditors of public companies

and strengthens auditor independence.

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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.

this information is forwarded to our shareholders.

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

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Number of Total Employees and Number of Full-Time

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

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

(35) employees;

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

thirty-four (34) full-time employees and one (1) part-time employee.

We have three (3) wholly owned subsidiaries:

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the SEC at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C.

You may also find all the reports

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 or in our website at konatel.com.

You may also find all of the reports 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 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