What changed in this filing

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Item 1. Business

2025-04-15 compared with 2024-04-01 · 206 added, 220 removed, 197 unchanged (68% of the section changed)

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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.

operated a home center in League City, Texas, about thirty (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, 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 Acquisition Corp., a Nevada corporation, on June 2, 2014 (respectively, “Dala Acquisition” 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 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.

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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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 cent ($0.01) par value shares of preferred stock for future

issuance as the Board of Directors may designate and approve.

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

as the Board of Directors may designate and approve.

Effective December 18, 2017, we completed an Agreement

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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 (“Telecon

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

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”) 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 Group LLC (the “OTC Markets”) OTCQB® Venture Market (“OTCQB Tier”).

on January 16, 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.” 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

On August 9, 2018, we entered

into an Asset Purchase 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, accounts receivable and a

customer list, among 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”), 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 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

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 (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.

To be eligible for quotations 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 and/or meet other compliance provisions of the OTC Markets contained in its “OTC Alternative Reporting Guidelines,”

which include, among other miscellaneous conditions, a minimum bid price of $0.01, a “public float” of not less than 10%

of the total outstanding shares and a minimum of fifty (50) beneficial shareholders.

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 (the 2018 year designation reflects our change to a calendar year end in 2017, following the closing

of the KonaTel Nevada Merger).

On June 14, 2022, we and

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 (to be repaid prior to nine (9) months), together with interest

at the rate of 15% per annum (the “Interest Rate”).

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

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 Section 9 – Financial Statements and Exhibits, Item 9.01, Part IV, Item 15 hereof, and are incorporated herein by reference.

The CCUR Loan was paid in full on or about January 23, 2024, which was the “Initial Closing Date” of our “Purchase Agreement”

with Excess Telecom, Inc., a Nevada corporation, which is discussed below.

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,

and an FCC 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.

As of December 31, 2024, this agreement continues to be under review by

On April 6, 2023, pursuant

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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.

with the SEC on April 17, 2023, which is Hyperlinked in Section 9 – Financial Statements and Exhibits, Item 9.01, 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,

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.

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 (the “ACP” [which ended on June 1, 2024, and has not been renewed by the United

States Congress]) , 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 Section 9 – Financial

Statements and Exhibits, Item 9.01, Part IV, Item 15, below, and is incorporated herein by reference.

On November 10, 2023, Apeiron

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

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

of wholesale cellular voice and 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.

Apeiron Systems provides 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,

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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.

Telecom Purchase Agreement” or the “Membership Interest Purchase Agreement”) with Excess Telecom, Inc., a Nevada

corporation (“Excess Telecom”), pursuant to which KonaTel conveyed 49% of its membership interest in IM

Telecom to Excess Telecom on the “Initial Closing Date” in consideration of the sum of $10,000,000, and if approved by

the FCC, will convey the remaining 51% of the membership interest in IM Telecom to Excess Telecom for the sum of $100 on the

“Final Closing.” If not approved by the FCC, KonaTel shall retain 51% of IM Telecom and Excess Telecom shall retain 49%

of IM Telecom;

and KonaTel shall have no obligation to refund any portion of the funds paid by Excess Telecom to KonaTel.

agreements were also executed by the parties at the Initial Closing Date of the Excess Telecom Purchase Agreement, including a

Management Service Agreement, a Master Distribution Agreement and an Amended and Restated Operating Agreement (collectively, the

“Transaction Documents”).

As of December 31, 2024, the approval of this agreement by the FCC is still

For additional information on these Transaction Documents, see our 8-K Current Report dated January 22, 2024, filed

with the SEC on January 30, 2024, which is Hyperlinked in in Section 9 – Financial Statements and Exhibits, Item 9.01, Part

IV, Item 15, below, and are incorporated herein by reference.

Subsequent to December 31, 2024

of Certain Provisions of the Excess Telecom Agreement

IM Telecom and Excess Telecom

have been working together to establish best practices in compliance and building an expanded ETC footprint in the United States.

to our approved Federal Compliance Plan, IM Telecom has increased its state-authorized ETC approvals and is now approved in forty (40)

Although these state approvals are complete, IM Telecom is currently awaiting FCC delivery of several Study Area Codes (“SACs”)

to begin operating in the additional states.

In furtherance of this process, certain of the initial Transaction Documents have been restated

by signature dated March 4, 2025, but effective as of the date or dates set forth at the beginning of each of the referenced Transaction

Documents and copies of which accompany our 8-KA Current Report dated January 22, 2024, filed with the SEC on March 10, 2025, which is

Hyperlinked in in Section 9 – Financial Statements and Exhibits, Item 9.01, Part IV, Item 15, below, and is incorporated herein

by reference.

KonaTel Nevada was organized under the laws of the

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various retail and wholesale markets.

Through its sales network, it provided these services nationwide.

Through its sales network, it provides these services nationwide.

In furtherance of its proposed

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

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.

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

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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).

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.

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

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.

California, as well as in Europe and Asia.

On February 5, 2018, we entered into a purchase

agreement 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 currently operates as a 51% owned subsidiary of KonaTel.

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 or granted a new wireless reseller Lifeline Compliance Plan since 2012.

licensed ETC, IM Telecom is also an FCC licensed Affordable Connectivity Program (the “ACP” or the “ACP

Program”) 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

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.

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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

ACP was an FCC program that provided subsidized

high-speed wireless data services to low-income Americans, which expired on June 1, 2024.

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 States.

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

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We are headquartered in Plano, Texas.

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

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

Systems has nine (9) full-time employees;

IM Telecom has fifteen (15) full-time employees;

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

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Our principal products and

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

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

services, provided through Apeiron Systems and IM Telecom, include our CPaaS suite of services (SIP/VoIP, SMS/MMS, POTS Replacement),

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 forty (40) states/territories and our ACP services,

which until the termination of the ACP Program on June 1, 2024, had been 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

We generate revenue from

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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.

Our Mobile Services include retail and wholesale cellular voice/text/data services and IoT mobile data services through 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.

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

and as referenced above, the ACP Program terminated on June 1, 2024, and has not been renewed by Congress.

Distribution Methods of the Products or Services

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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, data and IoT wireless services.

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, 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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Concessions, Royalty Agreements or Labor Contracts

Our wholly owned subsidiary, IM Telecom, is an FCC

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 (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 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.

Our 51% owned subsidiary, IM Telecom, is an FCC 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 (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 up to forty (40) states.

Although the ACP

program officially ended in June of 2024, 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 D.C.

and Puerto Rico.

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

Infiniti Mobile also offers non-Lifeline and non-ACP

IM Telecom intends to maintain the designation with anticipation that the program, or one similar, will be restarted.

We hold a United States Patent

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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.

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.

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.

Need for any Governmental Approval of Principal

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On October 23, 2018, the FCC approved our acquisition

of IM Telecom, an FCC licensed wireless Lifeline carrier.

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

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) 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

of IM Telecom.

In 1985, during the Reagan administration, the FCC established the Lifeline Assistance program through generic powers afforded

the FCC under the Communications Act of 1934.

Cellular service was added to the Lifeline program in 2009.

The FCC has not approved any

new wireless reseller Lifeline Compliance Plans since 2012.

Existing and Probable Government Regulation to Our Current and Intended

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 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.

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 the provision 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 has and could continue to be harmed by adverse regulatory action or changes to existing laws and regulations.

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

Smaller Reporting Company

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Number of Total Employees and Number of Full-Time

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

(35) employees;

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

We have three (3) wholly owned subsidiaries:

and Apeiron Systems.

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

(28) full-time employees and no part-time employees.

We have two (2) wholly owned subsidiaries:

KonaTel Nevada and Apeiron Systems;

and we currently own 51% of IM Telecom, with the remaining 49% being owned by Excess Telecom,

which, if our Excess Telecom Purchase Agreement is approved by the FCC, Excess Telecom will own 100% of IM

Telecom, subject to existing related Transaction Documents.

Our subsidiary, KonaTel Nevada, has remained inactive since early

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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