What changed in this filing

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Item 1A. Risk Factors

2024-04-01 compared with 2023-04-17 · 150 added, 204 removed, 400 unchanged (47% of the section changed)

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ensure the long-term successful operation of our business or the execution of our business plan.

We have a limited operating history, having commenced

our current business operations in November of 2014, and our wireless marketing technology and solutions are an evolving business offering.

As a result, investors have a limited track record by which to evaluate our future performance.

We commenced our current business operations in November

of 2014, and our wireless marketing technology and solutions are an evolving business offering.

Our prospects must be considered in light

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integration of potential evolving offerings of products and acquisitions.

Our business strategy may be unsuccessful, and we

may be unable to address the risks we face in a cost-effective manner, if at all.

If we are unable to successfully accomplish these tasks,

our business will be harmed, and we may fail.

For the year end December 31, 2022, we reported gross revenues of $20,023,340,

cost of revenues of $15,033,733, operating expenses of $7,544,292, other income and expenses of ($397,675) and a net loss of ($2,952,360).

We anticipate additional revenue and net income growth in 2023, further reducing our accumulated deficit balance.

Our business strategy may be unsuccessful, and

we may be unable to address the risks we face in a cost-effective manner, if at all.

If we are unable to successfully accomplish these

tasks, our business will be harmed, and we may fail.

For the year end December 31, 2023, we reported gross

revenues of $18,223,745, cost of revenues of $14,850,105, operating expenses of $6,494,243, other income and expenses of ($820,224) and

a net loss of ($3,940,827).

For the prior year ended December 31, 2022, we reported

gross revenues of $20,023,340, cost of revenues of $15,033,733, operating expenses of $7,544,292, other income and expenses of ($397,675)

and net income of $622,986.

and net loss of ($2,952,360).

For the year ended December 31, 2023, we had $12,352,

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and planned business operations.

Considering there are approximately 7,300,000 current Lifeline users and approximately 38,000,000 eligible Lifeline customers (according to USAC), this would be a draconian move;

Considering there are approximately 7,300,000 current Lifeline users and approximately 38,000,000 eligible Lifeline customers (according to Universal Service Administrative Company, a governmental body that administers the “Universal Service Fund” of the FCC [“USAC”]), this would be a draconian move;

however, it is a possibility.

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The impact of negative governmental changes and negative national carrier pricing have been outlined above.

In addition to those two risks, an interruption to the supply of low-cost phones and/or a reduction of Lifeline and ACP agents (no access to or not enough access to agents) would have a negative impact on Lifeline and/or ACP.

Adequate equipment financing and available cash resources to pay up-front compensation payments (sometimes required) is critical to facilitate Lifeline, ACP, B2B and retail sales, and the lack of these resources would have a negative impact on our business.

The increase in the number of resellers of services

and products that we provide by any national carrier could saturate the markets and market segments of our targeted customers, which could

The increase in the number of resellers of services and

products that we provide by any national carrier could saturate the markets and market segments of our targeted customers, which could

affect our business adversely.

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like PWG and Telispire.

If one of these aggregators vacated the market, such action could strand many resellers of these services,

like us, and could substantially reduce our current and anticipated revenues from our IoT or cellular service.

If one of these aggregators vacated the market, such action could force the transition of services to other providers,

and could substantially reduce our current and anticipated revenues from our IoT or cellular service.

A wireless reseller could gain a significant price

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was not available to us would allow that particular reseller to “undercut” all other resellers.

This scenario could

also apply to a national wireless carrier acquiring a reseller then allowing that reseller to operate with special wholesale pricing not

available to other resellers.

This scenario has happened in the past with Cricket Communications, Inc.

and Ultra Mobile, resellers

that were acquired by a national carrier.

This scenario could also apply

to a national wireless carrier acquiring a reseller then allowing that reseller to operate with special wholesale pricing not available

to other resellers.

Any such event could have a substantial adverse impact on our business and revenues.

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equity or debt financing.

Adequate funds for our operations,

whether from financial markets, collaborative or other arrangements, may

Adequate funds for our operations, whether from financial markets, collaborative or other arrangements, may

not be available when needed or on terms attractive to us.

If adequate funds are not available, our plans to operate

our business maybe adversely affected, and we could be required to curtail our activities significantly and/or cease operations.

If adequate funds are not available, our plans to operate our business may

be adversely affected, and we could be required to curtail our activities significantly and/or cease operations.

We will be unable to implement our business plan if

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could dissolve, reduce or restrict any wholesale program, agent program or reseller program.

This includes both voice and data IoT,

which would adversely affect our business.

This includes both voice and data IoT, which

would adversely affect our business.

We, like all voice and data resellers, are dependent

on the FCC licensed national carriers to provide services that can be resold for a profit.

The wireless carriers own/control their

respective network (towers) and provide the wireless service.

Resellers do not own their own network and are dependent on the national

carriers to provide a reseller program.

These carriers could eliminate a reseller program or implement new policies that could reduce

profit margins making any applicable program unprofitable.

They could also implement market restorations reducing markets we could

sell into, which would have a direct adverse effect on our current and future prospects.

on the FCC licensed national carriers to provide services that can be resold for profit.

The wireless carriers own/control their respective

network (towers) and provide the wireless service.

Resellers do not own network and are dependent on the national carriers to provide

a reseller program.

These carriers could eliminate a reseller program or implement new policies that could reduce profit margins,

making any applicable program unprofitable.

They could also implement market restorations reducing markets we could sell into, which would

have a direct adverse effect on our current and future prospects.

Similarly, one of these national carriers could reduce

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is unable to make enough profit to sustain operations.

This has happened in the past with Verizon until Verizon’s wholesale

(reseller) division finally reduced wholesale prices.

We may be unable to meet our current or future obligations

or to adequately exploit existing or future opportunities if we cannot raise sufficient capital.

or to adequately develop existing or future opportunities if we cannot raise sufficient capital.

If we are unable to obtain any required

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results and financial condition.

Most of our contracts are terminable by our customers

following limited notice and without early termination payments or liquidated damages due from them.

In addition, each stage of a project

often represents a separate contractual commitment, at the end of which the customer may elect to delay or not to proceed to the next

stage of the project.

We cannot assure you that one or more of our customers will not terminate a material contract or materially reduce

the scope of any large project.

The delay, cancellation or significant reduction in the scope of a large project or a number of projects

could have a material adverse effect on our business, operating results, and financial condition.

Most of our contracts are terminable by our

customers following limited notice and without early termination payments or liquidated damages due from them.

In addition, each

stage of a project often represents a separate contractual commitment, at the end of which the customer may elect to delay or not to

proceed to the next stage of the project.

We cannot assure you that one or more of our customers will not terminate a material

contract or materially reduce the scope of any large project.

The delay, cancellation or significant reduction in the scope of a

large project or a number of projects could have a material

adverse effect on our business, operating

results and financial condition.

Our industry is characterized by frequent technological

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themselves and may circumvent other applications’ efforts to block or remove them.

The ability to provide customers with a superior

interactive marketing technology experience is critical to our success.

If our efforts to combat these malicious applications fail, or

if our products and services have actual or perceived vulnerabilities, there may be claims based on such failures and our reputation may

be harmed, which would damage our business and financial condition and our ability to continue our business.

We face risks relating to Cyberattack.

If our efforts to combat these malicious applications

fail, or if our products and services have actual or perceived vulnerabilities, there may be claims based on such failures and our reputation

may be harmed, which would damage our business and financial condition and our ability to continue our business.

We face risks relating to Cyberattacks.

Our business operations are dependent upon secure

information technology systems and telecommunications networks.

Breaches of these systems and networks through cyberattack or other

unauthorized access may have numerous negative effects on our business, including lost sales and damage to customer relationships;

on our operations;

Breaches of these systems and networks through cyberattack or other unauthorized

access may have numerous negative effects on our business, including lost sales and damage to customer relationships;

disruptions on our

reputational harm and negative publicity;

lost trust from our customers, partners and employees;

lawsuits resulting

from the compromise of sensitive customer or employee information;

lawsuits resulting from the

compromise of sensitive customer or employee information;

costs of mitigation;

and remediation and security enhancement expenses.

and remediation and security

enhancement expenses.

See Part I, Item 1C, below.

We compete with other companies that have substantially

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We may be unable to retain

our employees or to attract, assimilate and retain other highly qualified employees who could migrate to other employers who offer competitive

or superior compensation packages.

our employees or to attract, assimilate and retain other highly qualified employees who could migrate to other employers who may offer

competitive or superior compensation packages.

Unpredictability in financing markets could impair

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Our reliance on information management and transaction

systems to operate our business exposes us to cyber incidents and hacking of our sensitive information if our outsourced service provider

systems to operate our business exposes us to cyber incidents and hacking of our sensitive information if our outsourced service providers

experiences a security breach.

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system disruptions could adversely affect our ability to effectively manage operations or reliably report results.

Cyberattacks against

companies have occurred and will continue to occur and have increased in frequency, scope and potential harm in recent years.

date, we have not been subject to cyberattacks, that, individually or in the aggregate, have been material to our operations, the preventative

actions we take to reduce the risks associated with cyberattacks may be insufficient to stop or mitigate the effects of a cyberattack

in the future.

See Part I, Item 1C, Cybersecurity.

Because our technology, products, platforms and

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and related software services to correct errors and defects.

In the future, there may be additional errors and defects in our software

that may adversely affect our services.

We may not have in place adequate reporting, tracking, monitoring and quality assurance procedures

to ensure that we can detect errors in our software in a timely manner.

If we are unable to efficiently and cost-effectively correct errors

or other problems that may be identified, or if there are unidentified errors that allow persons to improperly access our services, we

could experience loss of revenues and market share, damage to our reputation, increased expenses and legal actions by our customers and

our business may fail.

In the future, there may be additional errors and defects in our

software that may adversely affect our

We may not have in place adequate reporting, tracking, monitoring and quality assurance

procedures to ensure that we can detect errors in our software in a timely manner.

If we are unable to efficiently and cost-effectively

correct errors or other problems that may be identified, or if there are unidentified errors that allow persons to improperly access our

services, we could experience loss of revenues and market share, damage to our reputation, increased expenses and legal actions by our

customers and our business may fail.

We may have insufficient network or server capacity

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a material adverse effect on our business, financial condition and results of operations.

Our business operations could be impacted by the current

world health crisis.

On January 30, 2020, the World Health Organization

declared the coronavirus (the “Covid-19”) outbreak a “Public Health Emergency of International Concern,” and on

March 10, 2020, declared it to be a pandemic.

Actions taken around the world to help mitigate the spread of the coronavirus included restrictions

on travel and quarantines in certain areas, and forced closures for certain types of public places and businesses.

The coronavirus and

actions taken to mitigate it have had and are expected to continue to have an adverse impact on the economies and financial markets of

many countries, including the geographical areas in which we operate.

While it is unknown how long these conditions will last and what

the complete financial affect will be on us, to date, and as a result of actions taken by management to mitigate a material impact to

our financial statements or our operational results, we are not currently experiencing a material impact to our financial statements or

our results of operations;

however, a pandemic typically results in social distancing, travel bans and quarantines, which may result in

limited access to our facilities, customers, management, support staff and professional advisors.

These, in turn, may not only impact

our operations, financial condition and demand for our services, but our overall ability to react timely to mitigate the impact of this

Given our small staff, if a key member of our team were disabled by COVID-19, it could have a material negative impact on

our business.

Also, it may substantially hamper our efforts to provide our investors with timely information and to comply with

our filing obligations under the Exchange Act with the SEC.

If this pandemic were to last a prolonged period of time, we could see a decline

in revenue due to the closure of customer businesses, which could then impact our ability to pay our short-term debts.

Our concentration

of revenue from a small group of Apeiron Systems’ customers makes it reasonably possible that we are vulnerable to the risk of a

long-term severe impact.

Our dependence on certain suppliers to provide equipment to be distributed or sold to our customers could also

be impacted if inventory shortages occur due to import or export restrictions resulting from the pandemic.

General global market and economic conditions may have an adverse impact

on our operating performance and results of operations.

See Part I, Item 1C, Cybersecurity.

Our business operations could be impacted by public health crises.

We are subject to risks related to public health crises,

such as the 2020 COVID-19 pandemic, which impacted our operations.

Actions taken around the world to help mitigate the spread of the coronavirus

included restrictions on travel and quarantines in certain areas, and forced closures for certain types of public places and businesses.

The coronavirus and actions taken to mitigate it have had and are expected to continue to have an adverse impact on the economies and

financial markets of many countries, including the geographical

areas in which we operate.

While it is unknown how

long these conditions will last and what the complete financial affect will be on us, to date, and as a result of actions taken by management

to mitigate a material impact to our financial statements or our operational results, we are not currently experiencing a material impact

to our financial statements or our results of operations;

however, a pandemic typically results in social distancing, travel bans and

quarantines, which may result in limited access to our facilities, customers, management, support staff and professional advisors.

These, in turn, may not only impact our operations, financial condition and demand for our services, but our overall ability to react

timely to mitigate the impact of this event.

Given our small staff, if a key member of our team were disabled by COVID-19 or some other

similar crisis, it could have a material negative impact on our business.

Also, it may substantially hamper our efforts to provide our

investors with timely information and to comply with our filing obligations under the Exchange Act with the SEC.

If any pandemic were

to last a prolonged period of time, we could see a decline in revenue due to the closure of customer businesses, which could then impact

our ability to pay our short-term debts.

Our concentration of revenue from a small group of Apeiron Systems’ customers makes it

reasonably possible that we are vulnerable to the risk of a long-term severe impact.

Our dependence on certain suppliers to provide equipment

to be distributed or sold to our customers could also be impacted if inventory shortages occur due to import or export restrictions resulting

from any pandemic.

General global market and economic conditions may

have an adverse impact on our operating performance and results of operations.

Our business has been and could continue to be affected

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Flat or worsening economic conditions may harm our operating results and financial condition.

The Russian invasion of Ukraine may disrupt global telecommunications

While we do not have any direct exposure to Russia,

Belarus or Ukraine through our operations, employee base, investments or sourcing of goods and services, third party companies with whom

we do business may use Ukraine-based software developers.

These relationships may be affected by the global geopolitical disruptions

caused by the Russian invasion of Ukraine in February 2022.

We also face the risk that the invasion and ongoing war may result in

disruptions to national and international telecommunications networks, either through cyberattacks by state actors or others, physical

damage to the networks themselves or due to interruptions in the supply chain for the materials and services necessary to maintain them.

The likelihood and the potential size and scope of any such damage or disruptions is difficult to predict.

However, they may have

significant negative effects on the Company’s future business and results of operations.

Rising inflation may negatively affect our operating

During 2021 and 2022, global economic conditions have

deteriorated, with significantly increased inflation and the risks of further inflation and recession in 2023 and beyond.

unfavorable economic conditions may lead to decreased demand for our products or services in the future, especially by our lower-income

customers, which would have a negative effect on our business and results of operations.

In particular, inflation could affect the

price of equipment for the services provided in our Lifeline Program.

The ongoing Russian invasion of Ukraine and related sanctions on

Russia may also lead to higher prices for commodities used in the production of telephones and other technologies used in the global telecommunications

industry, which may result in decreased demand for our products and services.

To the extent that we are unable to increase the prices

of our goods and services in response to increased costs, our operating margins will be compressed.

Economic, political

and market conditions may adversely affect our business, financial condition and operating results.

Our business,

financial condition and operating results are sensitive to changes in general economic conditions, including interest rates, consumer

credit conditions, consumer debt levels, consumer confidence, unemployment rates, economic growth, energy costs, rates of inflation (or

concerns about deflation), supply chain disruptions, impacts of current geopolitical conflict or instability, such as the Ukraine-Russia

and Israel-Hamas wars, and further escalations thereof, and other macroeconomic factors.

These unfavorable economic conditions may lead to

decreased demand for our products or services in the future, especially by our lower-income customers, which would have a negative effect

on our business and results of operations.

In particular, inflation could affect the price of equipment for the services provided

in our Lifeline Program.

Ongoing global conflicts and sanctions could lead to higher prices for commodities used in the production of

telephones and other technologies used in the global telecommunications industry, which may result in decreased demand for our products

and services.

To the extent that we are unable to increase the prices of our goods and services in response to increased costs, our operating

margins will be compressed.

Supply chain disruptions could adversely affect

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Supply chain dislocations resulting from global geopolitical

and public health issues such as the Russian invasion of Ukraine, the COVID-19 pandemic and other causes may have a material adverse impact

on our business and results of operations.

Such disruptions may increase our costs of doing business, including through significant

increases in the price of our products and their components and materials and the related costs of shipment, including equipment used

in the Lifeline Program.

Supply chain disruptions may also adversely affect our access to suppliers, manufacturers, customers and

vendors and may impair our ability to perform contracted services.

Delays in our ability to meet our obligations as a result of

supply chain issues may negatively affect our reputation, our relationships with customers and our ability to deliver products and services.

and public health issues such as the Ukraine-Russia and Israel-Hamas wars, any resurgence in the COVID-19 health crises and other causes

may have a material adverse impact on our business and results of operations.

Such disruptions may increase our costs of doing business,

including significant increases in the price of our products and their components and materials and the related costs of shipment, including

equipment used in the Lifeline Program.

Supply chain disruptions may also adversely affect our access to suppliers, manufacturers, customers

and vendors and may impair our ability to perform contracted services.

Delays in our ability to meet our obligations as a result of supply

chain issues may negatively affect our reputation, our relationships with customers and our ability to deliver products and services.

The markets in which we operate are rapidly emerging,

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We have incurred and expect to continue to incur

costs associated with becoming and continuing as a public company, including, but not limited to, legal, accounting, filing and other

related costs and expenses.

Failure to comply with the applicable securities laws could result in private or governmental legal action

against us or our officers and directors, which could have a detrimental impact on our business and financial condition, the value of

our common stock and the ability of our shareholders to resell their common stock.

costs associated with continuing as a public company, including, but not limited to, legal, accounting, filing and other related costs

and expenses.

Failure to comply with the applicable securities laws could result in private or governmental legal action against us or

our officers and directors, which could have a detrimental impact on our business and financial condition, the value of our common stock

and the ability of our shareholders to resell their common stock.

We do not intend to pay dividends on our common

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for research, development and the furtherance of our business plan and our technologies, products, services and platform, and accordingly,

it is highly unlikely that you will receive any dividends from us in the near future, if ever.

it is highly unlikely that shareholders will receive any dividends from us in the near future, if ever.

We do not intend to provide guidance about future events in the foreseeable

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OTC Markets will post adverse warnings on its website about such failures, which, unless such failures are corrected by us, could have

an additional adverse impact on the viability of any market that may develop for our common stock.

Other adverse warnings of the OTC Markets

under their current and future policies could similarly have an adverse effect on any market for our common stock, and there is no assurance

that we will be able to satisfy comments or concerns of the OTC Markets, if any are expressed.

an additional adverse impact on the viability of any “established trading market” that may develop for our common stock.

adverse warnings of the OTC Markets under their current and future policies could similarly have an adverse effect on any market for our

common stock, and there is no assurance that we will be able to satisfy comments or concerns of the OTC Markets, if any are expressed.

If an active market for our common stock develops,

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announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, joint ventures or capital raises.

Our common stock is subject to the “penny

stock” rules of the SEC, which may make it more difficult for shareholders to sell our common stock.

The SEC has adopted Rule 15g-9, which established

the definition of a “penny stock,” for the purposes relevant to us, as any equity security that has a market price of less

than $5.00 per share, subject to certain exceptions.

For any transaction involving a penny stock, unless exempt, the rules require that

a broker or dealer approve a person’s account for transactions in penny stocks, and the broker or dealer receive from the investor

a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.

In order to approve a person’s account for transactions

in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person and make a

reasonable determination that the transactions in penny stocks are suitable for that person and that the person has sufficient knowledge

and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.

The broker or dealer must also deliver, prior to any

transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which, in highlight form

sets forth the basis on which the broker or dealer made the suitability determination, and that the broker or dealer received a signed,

written agreement from the investor prior to the transaction.

Generally, brokers may be less willing to execute

transactions in securities subject to the “penny stock” rules.

This may make it more difficult for investors to dispose of

the Company’s common stock if and when such shares are eligible for sale and may cause a decline in the market value of its stock.

Because of increased regulatory efforts of governmental

and quasi-governmental agencies regarding the trading of securities that are deemed to be penny stocks, the cost and expense of depositing

and inducing a broker-dealer to effect sales of these shares is very costly, which can be in excess of value of the shares sought to be

sold, and often includes requirements of legal opinions of both the selling shareholder’s counsel and the broker-dealer’s

counsel, both at the expense of the selling shareholder.

Currently, broker-dealers require legal opinions of

shareholders of almost all over-the-counter stocks to deposit and sell these shares, and all of these legal opinions are required to be

paid for by the shareholder;

and often, two (2) legal opinions are required, one (1) from the shareholder’s legal counsel and one

(1) from the broker-dealer’s legal counsel.

This policy has been required of mostly all low-priced over-the-counter traded securities,

regardless of whether the shares have been registered with the SEC, or whether there is no “restrictive” legend on the stock

certificate representing the shares and always if the shares are designated as “restricted securities.” Larger, national broker-dealers

will generally not even trade these securities.

The high cost of these types of legal opinions is often more than the value of the shares

sought to be sold, and the process can take two (2) to three (3) weeks or more.

Accordingly, shareholders with limited shares of low-priced

stocks will be unable to economically sell their shares, regardless of whether an “established trading market” for the shares

exists, and if they could sell their shares, the required selling process may inhibit their ability to sell the shares when they desire

to sell their shares.

Because we became public by means of a reverse

acquisition, we may not be able to attract the attention of brokerage firms.

Because we became public through a “reverse

acquisition,” securities analysts of brokerage firms may not provide coverage of us since there is little incentive to brokerage

firms to recommend the purchase of our common stock.

Moreover, no assurance can be given that brokerage firms will want to conduct capital

raises on our behalf, presently or in the future.

Our investors’ ownership in the Company may

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in the Company.

Directors, executive officers, principal shareholders and affiliated

entities own a significant percentage of our capital stock, and they may make decisions that our shareholders do not consider to be in

their best interests.

Directors, executive officers, principal shareholders

and affiliated entities own a significant percentage of our capital stock, and they may make decisions that our shareholders do not consider

to be in their best interests.

As of the date of this Annual Report, D.

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by reason of his personal holdings.

This percentage does not include certain vested non-compensatory stock options which he owns and that

can be exercised within sixty (60) days of the date of this Annual Report, all of which options are described under the caption “Security

This percentage includes certain vested non-compensatory stock options which he owns and that can

be exercised within sixty (60) days of the date of this Annual Report, all of which options are described under the caption “Security

Ownership of Certain Beneficial Owners and Management” in Part III, Item 12 hereof.

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If we cannot provide reliable financial reports or prevent fraud, we may not

be able to manage our business as effectively as would be possible with an effective control system in place.

We have not performed an

in-depth analysis to determine if historical undiscovered failures of internal controls exist and may in the future discover areas of

our internal controls that need improvement.

be able to manage our business as effectively as would be possible with an

effective control system in place.

We have not performed

an in-depth analysis to determine if historical undiscovered failures of internal controls exist and may in the future discover areas

of our internal controls that need improvement.

We are continually in the process of evaluating our

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loss of confidence could have a substantial negative affect on the trading price of our common stock.

UNRESOLVED STAFF COMMENTS

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 1A. Risk Factors