What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2021-05-17 compared with 2020-11-16 · 786 added, 1876 removed, 752 unchanged (78% of the section changed)

Financial Statements

Company’s unaudited financial statements for the nine months ended September 30, 2020 and for comparable periods in the

prior year are included below.

The financial statements should be read in conjunction with the notes to financial statements that

Company’s unaudited financial statements for the three months ended March 31, 2021 and for comparable periods in the prior

year are included below.

The financial statements should be read in conjunction with the notes to financial statements that follow.

CORP AND SUBSIDIARIES

1 unchanged sentence

CONSOLIDATED BALANCE SHEETS AS OF

September 30, 2020

March 31, 2021

December 31, 2020

13 unchanged sentences

current portion

Related party payable

Line of credit

Note payable Coronavirus loans–

current portion

Due to related party

Lease liabilities - current

Provision for income taxes

Stock subscription payable

Liabilities from discontinued operations

1 unchanged sentence

Long term liabilities:

Convertible debt, net of discount, unamortized, $1,051,382 and $635,333, respectively

Convertible debt, net of discount, unamortized, $924,199 and

$1,084,944, respectively

Note payable Coronavirus loans–

Lease liabilities –

2 unchanged sentences

Preferred Stock, $0.0001 par value;

3,333,333 shares authorized

3,333,333 shares authorized, 0 shares issued and outstanding

Common stock, ($0.0001 par value;

50,000,000 shares authorized, 3,564,299 shares issued and outstanding as of September 30, 2020 and 121,216 outstanding at December 31, 2019, respectively)

50,000,000 shares authorized, 6,177,203 shares issued and outstanding as of March 31, 2021 and 4,080,017 outstanding at December 31, 2020, respectively)

Additional paid-in capital

2 unchanged sentences

(13,878,553 )

Accumulated other comprehensive (income) loss

Accumulated other comprehensive income

Total stockholders’

4 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

COMPREHNSIVE LOSS

COMPREHENSIVE LOSS

Three Months Ended

September 30, 2020

Three Months Ended

September 30, 2019

Nine Months Ended

September 30, 2020

Nine Months Ended

September 30, 2019

March 31, 2021

March 31, 2020

Cost of sales

Operating expenses:

Selling and general administrative

Selling, general and administrative

Salaries, wages and payroll taxes

Stock based compensation

Professional fees

2 unchanged sentences

Loss before other expenses and income taxes

Other (income) expense

Change in fair value of derivative instruments, net

Gain on debt extinguishment

Interest earned

Interest expense

Foreign currency exchange rate variance

Total other (income) expense

Net loss before income (loss) tax expense

$ (1,100,451 )

$ (1,358,745 )

Provision for income taxes

Net income (loss)

Total other expenses

Comprehensive Income:

Net income (loss)

Foreign currency translation adjustments

Comprehensive income (loss)

$ (1,094,849 )

$ (1,378,585 )

NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS

Weighted number of common shares outstanding –

basic & diluted

Basic and diluted net (loss) per share

the accompanying notes to the unaudited condensed consolidated financial statements.

TRACKING CORP.

AND SUBSIDIARIES

ORBITAL TRACKING CORP.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Nine Months Ended September 30, 2020

December 31, 2019

common stock from convertible debt

Comprehensive

September 30, 2020

the Nine Months Ended September 30, 2019

Preferred Stock -

$0.0001 Par Value

Balance, December 31, 2018

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Comprehensive loss

Balance, September 30, 2019

accompanying notes to unaudited condensed consolidated financial statements.

AND SUBSIDIARIES

ORBITAL TRACKING CORP.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Three Months Ended September 30, 2020

Preferred Stock -

$0.0001 Par Value

Balance, June 30, 2020

Issuance common stock from convertible debt

Comprehensive loss

Balance, September 30, 2020

the Three Months Ended September 30, 2019

Preferred Stock -

$0.0001 Par Value

Balance, June 30, 2019

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Comprehensive loss

Balance, September 30, 2019

accompanying notes to unaudited condensed consolidated financial statements.

Net loss Per Share - Basic & Diluted

Weighted average common shares outstanding - Basic & Diluted

the accompanying notes to the unaudited condensed consolidated financial statements.

CORP AND SUBSIDIARIES

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Nine Months Ended September 30, 2020

Preferred Stock -

the Three Months Ended March 31, 2021

Preferred Stock - Series A

Preferred Stock - Series B

Preferred Stock - Series C

$0.0001 Par Value

4 unchanged sentences

Comprehensive loss

Balance, September 30, 2020

the Nine Months Ended September 30, 2019

Preferred Stock -

Balance, March 31, 2021

the Three Months Ended March 31, 2020

Preferred Stock - Series A

Preferred Stock - Series B

Preferred Stock - Series C

$0.0001 Par Value

2 unchanged sentences

Balance, December 31, 2019

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Comprehensive loss

Balance, September 30, 2019

accompanying notes to unaudited condensed consolidated financial statements.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Three Months Ended September 30, 2020

Preferred Stock -

$0.0001 Par Value

Balance, June 30, 2020

Issuance common stock from convertible debt

Comprehensive loss

Balance, September 30, 2020

the Three Months Ended September 30, 2019

Preferred Stock -

$0.0001 Par Value

Balance, June 30, 2019

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Exercise of options to common

Comprehensive loss

Balance, September 30, 2019

Balance, March 31, 2020

accompanying notes to unaudited condensed consolidated financial statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Nine Months Ended September 30, 2020

Preferred Stock -

the Three Months Ended March 31, 2021

Preferred Stock - Series D

Preferred Stock - Series E

Preferred Stock - Series F

$0.0001 Par Value

4 unchanged sentences

Comprehensive loss

Balance, September 30, 2020

the Nine Months Ended September 30, 2019

Preferred Stock -

Balance, March 31, 2021

the Three Months Ended March 31, 2020

Preferred Stock - Series D

Preferred Stock - Series E

Preferred Stock - Series F

$0.0001 Par Value

2 unchanged sentences

Balance, December 31, 2019

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Exercise of options to common

Comprehensive loss

Balance, September 30, 2019

Balance, March 31, 2020

accompanying notes to unaudited condensed consolidated financial statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Three Months Ended September 30, 2020

Preferred Stock -

the Three Months Ended March 31, 2021

Preferred Stock - Series G

Preferred Stock - Series H

Preferred Stock - Series I

$0.0001 Par Value

1 unchanged sentence

$0.0001 Par Value

Balance, June 30, 2020

Balance, December 31, 2020

Issuance common stock from convertible debt

Comprehensive loss

Balance, September 30, 2020

the Three Months Ended September 30, 2019

Balance, March 31, 2021

the Three Months Ended March 31, 2020

Preferred Stock -

4 unchanged sentences

$0.0001 Par Value

Balance, June 30, 2019

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Balance, December 31, 2019

Exercise of options to common

Comprehensive loss

Balance, September 30, 2019

Balance, March 31, 2020

accompanying notes to unaudited condensed consolidated financial statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Nine Months Ended September 30, 2020

Preferred Stock –

the Three Months Ended March 31, 2021

Preferred Stock - Series J

Preferred Stock - Series K

Preferred Stock - Series L

$0.0001 Par Value

4 unchanged sentences

Comprehensive loss

Balance, September 30, 2020

the Nine Months Ended September 30, 2019

Balance, March 31, 2021

the Three Months Ended March 31, 2020

Preferred Stock –

5 unchanged sentences

Balance, December 31, 2019

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Comprehensive loss

Balance, September 30, 2019

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Three Months Ended September 30, 2020

Preferred Stock –

$0.0001 Par Value

Balance, June 30, 2020

Issuance common stock from convertible debt

Comprehensive loss

Balance, September 30, 2020

the Three Months Ended September 30, 2019

Preferred Stock –

$0.0001 Par Value

Balance, June 30, 2019

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Exercise of options to common

Comprehensive loss

Balance, September 30, 2019

Balance, March 31, 2020

accompanying notes to unaudited condensed consolidated financial statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Nine Months Ended September 30, 2020

the Three Months Ended March 31, 2021

$0.0001 Par Value

3 unchanged sentences

Beneficial conversion feature of convertible debt

Issuance common stock for options exercised

Fair value of options granted

Stock based compensation

Comprehensive loss

Balance, September 30, 2020

Balance, March 31, 2021

$ (14,681,695 )

the Nine Months Ended September 30, 2019

the Three Months Ended March 31, 2020

$0.0001 Par Value

1 unchanged sentence

$ (11,115,178 )

Beneficial conversion feature of convertible debt

Common issued for post-split adjustments

Preferred shares converted to note payable

Preferred shares converted to common

Exercise of options to common

Comprehensive loss

Balance, September 30, 2019

$ (10,731,617 )

accompanying notes to unaudited condensed consolidated financial statements.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Three Months Ended September 30, 2020

$0.0001 Par Value

Balance, June 30, 2020

$ (11,373,472 )

Issuance common stock from convertible debt

Beneficial conversion feature of convertible debt

Issuance common stock for options exercised

Fair value of options granted

Stock based compensation

Comprehensive loss

Balance, September 30, 2020

$ (12,473,923 )

the Three Months Ended September 30, 2019

$0.0001 Par Value

Balance, June 30, 2019

$ (10,430,670 )

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Comprehensive loss

Balance, September 30, 2019

Balance, March 31, 2020

$ (11,400,038 )

3 unchanged sentences

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Nine Months Ended September 30, 2020

Comprehensive

Stockholders’

December 31, 2019

common stock from convertible debt

conversion feature of convertible debt

common stock for options exercised

value of options granted

based compensation

Comprehensive

September 30, 2020

the Nine Months Ended September 30, 2019

the Three Months Ended March 31, 2021

Comprehensive

2 unchanged sentences

Balance, December 31, 2020

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Comprehensive loss

Balance, September 30, 2019

accompanying notes to unaudited condensed consolidated financial statements.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’

the Three Months Ended September 30, 2020

Comprehensive

Stockholders’

Income (Loss)

Balance, June 30, 2020

Issuance common stock from convertible debt

Beneficial conversion feature of convertible debt

Issuance common stock for options exercised

Fair value of options granted

Stock based compensation

Comprehensive loss

Balance, September 30, 2020

the Three Months Ended September 30, 2019

Comprehensive gain

Balance, March 31, 2021

the Three Months Ended March 31, 2020

Comprehensive

1 unchanged sentence

Income (Loss)

Balance, June 30, 2019

Beneficial conversion feature of convertible debt

Preferred shares converted to note payable

Preferred shares converted to common

Balance, December 31, 2019

Issuance common stock from convertible debt

Exercise of options to common

Comprehensive loss

Balance, September 30, 2019

Balance, March 31, 2020

accompanying notes to unaudited condensed consolidated financial statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

THE NINE MONTHS ENDED

September 30, 2020

September 30, 2019

THE THREE MONTHS ENDED

March 31, 2021

March 31, 2020

CASH FLOWS FROM OPERATING ACTIVITIES:

$ (1,358,745 )

Adjustments to reconcile net loss to net cash used in operating activities:

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Depreciation expense

1 unchanged sentence

Amortization of right to use

Amortization of convertible debt, net

Stock based compensation

Fair value of options exercised

Fair value of options granted

Amortization of convertible debt discount

Change in fair value of derivative liabilities

Convertible debt issued for services

Gain on debt extinguishment

Change in operating assets and liabilities:

7 unchanged sentences

Contract liabilities

Net cash used in operating activities

Net cash (used in) provided by operating activities

CASH FLOWS FROM INVESTING ACTIVITIES:

3 unchanged sentences

Repayments of note payable, related party, net

Repayments from line of credit

Repayments from note payable

Repayments from convertible notes payable

Proceeds from note payable

Proceeds of convertible notes payable

Repayments of notes payable

Proceeds of convertible debt

Net cash provided by financing activities

Effect of exchange rate on cash

Net increase (decrease) in cash

Net (decrease) increase in cash

Cash beginning of period

4 unchanged sentences

Beneficial conversion feature on convertible debt

Long term debt issued in exchange for preferred stock

Conversion of convertible debt into common shares

11 unchanged sentences

to make the financial statements not misleading.

The unaudited financial statements for the nine months ending September 30, 2020,

The unaudited financial statements for the three months ending March 31, 2021,

are not necessarily indicative of the results for the remainder of the fiscal year.

30 unchanged sentences

(“Orbital Satcom”), a Nevada corporation was formed on November 14,

March 28, 2014, the Company merged with and into a wholly-owned subsidiary of the Company (“Great West”) solely for

the purpose of changing its state of incorporation to Nevada from Delaware (the “Reincorporation”), effecting a 1:150

reverse split of its common stock, and changing its name to Great West Resources, Inc.

in connection with the plans to enter into

the business of potash mining and exploration.

During late 2014, the Company abandoned its efforts to enter the potash mining

and exploration business.

All references in the audited consolidated financial statements and notes thereto have been retroactively

restated to reflect the reverse stock split of 1:150.

the effective date of the merger:

Each share of the Company’s common stock issued and outstanding immediately prior to the effective date changed and converted

into 1/150th fully paid and non-assessable shares of Great West common stock;

Each share of the Company’s Series A preferred stock issued and outstanding immediately prior to the effective date changed

and converted into 1/150th fully paid and non-assessable shares of the Great West Series A preferred stock;

Each share of the Company’s Series D preferred stock issued and outstanding immediately prior to the effective date changed

and converted into 1/150th fully paid and non-assessable shares of the Great West Series B preferred stock;

CORP AND SUBSIDIARIES

1 unchanged sentence

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

All options to purchase shares of the Company’s common stock issued and outstanding immediately prior to the effective date

changed and converted into equivalent options to purchase 1/150th of a share of Great West common stock at an exercise price of

$0.0001 per share;

All warrants to purchase shares of the Company’s common stock issued and outstanding immediately prior to the effective

date changed and converted into equivalent warrants to purchase 1/150th of a share of Great West common stock at 150 times the

exercise price of such converted warrants;

Each share of Great West common stock issued and outstanding immediately prior to the effective date were canceled and returned

to the status of authorized but unissued Great West common stock.

Telesat Communications Limited (“GTCL”) was formed under the laws of England and Wales in 2008.

2 unchanged sentences

to which GTCL became a wholly-owned subsidiary of the Company.

accounting purposes, this transaction was accounted for as a reverse acquisition and has been treated as a recapitalization of

the Company with GTCL considered the accounting acquirer, and the financial statements of the accounting acquirer became the financial

statements of the registrant.

The completion of the Share Exchange resulted in a change of control.

The Share Exchange was accounted

for as a reverse acquisition and re-capitalization.

The GTCL shareholders obtained approximately 39% of voting control on the

date of Share Exchange.

GTCL was the acquirer for financial reporting purposes and the Company was the acquired company.

The consolidated

financial statements after the acquisition include the balance sheets of both companies at historical cost, the historical results

of GTCL and the results of the Company from the acquisition date.

All share and per share information in the accompanying consolidated

financial statements and footnotes has been retroactively restated to reflect the recapitalization.

See Note 12 - Stockholders

August 19, 2019, we effected a reverse split in 1-for-15 ratio as applied to our common stock and preferred stock, as well as

the number of authorized shares for both classes.

As of December 31, 2019, we had 121,216 shares issued and outstanding post-split.

All share and per share, information in the accompanying consolidated financial statements and footnotes has been retroactively

restated to reflect the most recently completed reverse split.

See Note 12 - Stockholders Equity.

preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported

20 unchanged sentences

all means of collection have been exhausted and the potential for recovery is considered remote.

As of September 30, 2020, and

As of March 31, 2021, and 2020,

there is an allowance for doubtful accounts of $0 and $5,300, respectively.

10 unchanged sentences

carrying value of inventories is recorded to cost of goods sold.

expenses amounted to $1,784 and $18,596, at September 30, 2020 and December 31, 2019, respectively.

expenses amounted to $1,784 and $1,784, at March 31, 2021 and December 31, 2020, respectively.

Prepaid expenses include prepayments

18 unchanged sentences

relevant translation rates are as follows:

for the three and nine months ended September 30, 2020, closing rate at 1.2923 US$:

GBP, quarterly average rate at 1.293173 US$:

GBP and yearly average rate at 1.271713 US$:

GBP, for the three and nine months ended

September 30, 2019, closing rate at 1.269800 US$:

GBP, quarterly average rate at 1.293793 US$:

GBP and yearly average rate of

1.285336, for the year ended 2019 closing rate at 1.3262 US$:

for the three months ended March 31, 2021, closing rate at 1.3783 US$:

GBP, quarterly

average rate at 1.379068 US$:

GBP, for the three months ended March 31, 2020, closing rate at 1.245481 US$:

GBP, quarterly average

rate at 1.281097 US$:

GBP, for the year ended 2020 closing rate at 1.3665 US$:

GBP, average rate at 1.286618 US$:

61 unchanged sentences

liabilities is shown separately in the unaudited consolidated balance sheets as current liabilities.

At September 30, 2020 and

December 31, 2019, we had contract liabilities of $40,427 and $41,207, respectively.

At March 31, 2021 and December

31, 2020, we had contract liabilities of $31,547 and $36,704, respectively.

of Product Sales and Services

7 unchanged sentences

because the Company includes in revenue the related costs that the Company bills its customers.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

assets include customer contracts purchased and recorded based on the cost to acquire them.

15 unchanged sentences

management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows.

recorded an impairment charge of $0 and $50,000, during the nine months ended September 30, 2020 and for the year ended December

recorded an impairment charge of $0 and $0, during the three months ended March 31, 2021 and for the year ended December 31, 2020,

respectively.

18 unchanged sentences

Website development

expense for the three months ended September 30, 2020 and 2019 were $67,447 and $62,859, respectively.

Depreciation expense for

the nine months ended September 30, 2020 and 2019 were $199,242 and $184,484, respectively.

expense for the three months ended March 31, 2021 and 2020 were $67,450 and $65,254, respectively.

of long-lived assets

6 unchanged sentences

The Company did not consider it necessary to record any impairment

charges during the periods ended September 30, 2020 and September 30, 2019, respectively.

charges during the periods ended March 31, 2021 and March 31, 2020, respectively.

for Derivative Instruments

94 unchanged sentences

and development costs related to both present and future products are expensed in the period incurred.

On February 19, 2015, the

Company issued 444 of its common stock, par value $0.0001, at $112.61 per share, or $50,000, to a consultant as compensation for

the design and delivery of dual mode gsm/Globalstar Simplex tracking devices and related hardware and intellectual property.

the year ended December 31, 2019, the Company recorded an impairment charge of $50,000 for the above-mentioned other asset, due

to the delay in its launch to our existing product lines.

For the nine months ended September 30, 2020 and 2019, there were no

additional expenditures on research and development.

For the three months ended

March 31, 2021 and 2020, there were no expenditures on research and development.

per Common Share

7 unchanged sentences

are excluded.

following are dilutive common stock equivalents during the nine months ended:

September 30,

following are dilutive common stock equivalents during the quarter ended:

March 31, 2021

March 31, 2020

Convertible notes payable (1)

5,762,056 (1)

8,050,000 (2)

Stock Options

Stock Warrants

shares of our common stock issuable upon conversion of $1,152,411 of Convertible Notes Payable at a conversion rate of $0.20

per share, as of September 30, 2020, not accounting for 9.99% beneficial ownership limitations.

shares of our common stock issuable upon conversion of $805,000 of Convertible Notes Payable at a conversion rate of $0.10

per share, as of September 30, 2019, not accounting for 4.99% beneficial ownership limitations.

June 15, 2020, Orbsat Corp (the “Company”) and the holders of the majority convertible promissory notes sold by the

Company in the May 2019 private offering agreed to amend certain terms and provisions of the Note Purchase Agreement dated as

of May 13, 2019 (the “NPA”) and related convertible promissory notes (the “Notes”) consistent with the

terms of such instruments as follows, to amend Section 3(a) of the Notes to change the “Conversion Price”

per share to $0.20 per share;

to amend Section 4 the beneficial ownership limitation upon conversion of the Notes from 4.99% to

9.99%, as described further in Note 10.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

April 30, 2019, the Company exchanged preferred shares to promissory notes and is treated as extinguishment of preferred shares.

In accordance with ASC 260-10-S99, such extinguishment on preferred shares considered as redemptions of preferred shares and the

difference between the fair value of the consideration and the carrying amount of the preferred shares will adjust the net income

(loss) available to common stockholders in the calculation of earnings per shares.

The following are the adjustment to the net

income (loss) available to common stockholders during the period ended:

Nine Months Ended September 30, 2020

Year Ended December 31, 2019

$ (1,358,745 )

$ (1,379,756 )

Preferred shares redemption adjustment

Net loss available to common shareholders

$ (1, 358,745 )

$ (1,177,832 )

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS

Weighted number of common shares outstanding –

basic & diluted

Loss applicable to common shareholders per share

4,368,486 and 7,936,740 shares of our common stock issuable upon conversion of $1,186,176 and $793,674 of Convertible Notes Payable

as of March 31, 2021 and 2020, not accounting for 4.99% beneficial ownership limitations.

Party Transactions

9 unchanged sentences

might be prevented from fully pursuing its own separate interests is also a related party.

Accounting Pronouncements

May 2016, the FASB issued ASU No.

2016-12, Revenue from Contracts with Customers (Topic 606):

Narrow-Scope Improvements and

Practical Expedient , which is to (1) clarify the objective of the collectability criterion for applying paragraph 606-10-25-7;

(2) permit an entity to exclude amounts collected from customers for all sales (and other similar) taxes from the transaction

(3) specify that the measurement date for noncash consideration is contract inception;

(4) provide a practical expedient

that permits an entity to reflect the aggregate effect of all modifications that occur before the beginning of the earliest period

presented when identifying the satisfied and unsatisfied performance obligations, determining the transaction price, and allocating

the transaction price to the satisfied and unsatisfied performance obligations;

(5) clarify that a completed contract for purposes

of transition is a contract for which all (or substantially all) of the revenue was recognized under legacy GAAP before the date

of initial application, and (6) clarify that an entity that retrospectively applies the guidance in Topic 606 to each prior reporting

period is not required to disclose the effect of the accounting change for the period of adoption.

The amendments of this ASU

are effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years.

impact as a result of adopting this ASU on the financial statements and related disclosures.

CORP AND SUBSIDIARIES

1 unchanged sentence

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 2016, the FASB issued ASU No.

2016-01, Financial Instruments —

Recognition and Measurement of Financial

Assets and Financial Liabilities.

The guidance affects the accounting for equity investments, financial liabilities under

the fair value option and the presentation and disclosure requirements of financial instruments.

The guidance is effective in

the first quarter of fiscal 2019.

Early adoption is permitted for the accounting guidance on financial liabilities under the fair

value option.

There was no impact as a result of adopting this ASU on the financial statements and related disclosures.

May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718 ) :

Scope of Modification Accounting

(ASU 2016-09), which provides guidance about which changes to the terms or conditions of a share-based payment award require

an entity to apply modification accounting in Topic 718, such as the repricing of share options, which would revalue those options

and the accounting for the cancellation of an equity award whether a replacement award or other valuable consideration is issued

in conjunction with the cancellation.

If not, the cancellation is viewed as a replacement and not a modification, with a repurchase

This pronouncement is effective for annual reporting periods beginning after December 15, 2017.

The Company adopted

this standard on January 1, 2018 and did not have a material impact on the Company’s financial statements.

July 2017, the FASB issued ASU No.

2017-11, Earnings Per Share, Distinguishing Liabilities from Equity and Derivatives and

Hedging , which changes the accounting and earnings per share for certain instruments with down round features.

The amendments

in this ASU are applied using a cumulative-effect adjustment as of the beginning of the fiscal year or retrospective adjustment

to each period presented and is effective for annual periods beginning after December 15, 2018, and interim periods within those

December 22, 2017 the SEC issued Staff Accounting Bulletin 118 (SAB 118), which provides guidance on accounting for the tax effects

of the Tax Cuts and Jobs Act (the “TCJA”).

SAB 118 provides a measurement period that should not extend beyond one

year from the enactment date for companies to complete the accounting under ASC 740.

In accordance with SAB 118, a company must

reflect the income tax effects of those aspects of the TCJA for which the accounting under ASC 740 is complete.

To the extent

that a company’s accounting for certain income tax effects of the TCJA is incomplete but for which they are able to determine

a reasonable estimate, it must record a provisional amount in the financial statements.

Provisional treatment is proper in light

of anticipated additional guidance from various taxing authorities, the SEC, the FASB, and even the Joint Committee on Taxation.

If a company cannot determine a provisional amount to be included in the financial statements, it should continue to apply ASC

740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the TCJA.

has applied this guidance to its consolidated financial statements.

Accounting Pronouncements

November 2018, the FASB amended Topic 842, Leases, by issuing ASU No.

13 unchanged sentences

24, 2019, when the Company entered into a three-year lease for its UK office and warehouse for annual rent of £25,536 or

GBP:USD using exchange rate close for the nine months ended September 30, 2020, GBP:USD 1.292300 or $33,000.

An entity may choose

to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements

as its date of initial application.

If an entity chooses the second option, the transition requirements for existing leases also

apply to leases entered into between the date of initial application and the effective date.

The entity must also recast its comparative

period financial statements and provide the disclosures required by the new standard for the comparative periods.

Consequently,

financial information will not be updated, and the disclosures required under the new standard will not be provided for dates

and periods before January 1, 2019.

September 30, 2020, the Company had current and long-term operating lease liabilities of $28,489 and $28,667, respectively, and

right of use assets of $59,906.

USD using exchange rate close for the three months ended March 31, 2021, for liability of 1.3783 or $35,196.

An entity may

choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial

statements as its date of initial application.

If an entity chooses the second option, the transition requirements for existing

leases also apply to leases entered into between the date of initial application and the effective date.

The entity must also

recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative

Consequently, financial information will not be updated, and the disclosures required under the new standard will not

be provided for dates and periods before January 1, 2019.

March 31, 2021, the Company had current and long-term operating lease liabilities of $30,385 and $14,725, respectively, and right

of use assets of $48,043.

accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected

7 unchanged sentences

accompanying consolidated financial statements are prepared assuming the Company will continue as a going concern.

30, 2020, the Company had an accumulated deficit of $12,473,923, positive working capital of $95,587 and net loss of $1,358,745

during the nine months ended September 30, 2020.

These factors raise substantial doubt about the Company’s ability to continue

as a going concern for one year from the issuance of the financial statements.

2021, the Company had an accumulated deficit of $14,681,695, negative working capital of $33,271 and net loss of $803,142 during

the three months ended March 31, 2021.

These factors raise substantial doubt about the Company’s ability to continue as

a going concern for one year from the issuance of the financial statements.

The ability of the Company to continue as a going

9 unchanged sentences

3 - INVENTORIES

September 30, 2020 and December 31, 2019, inventories consisted of the following:

September 30, 2020

March 31, 2021 and December 31, 2020, inventories consisted of the following:

March 31, 2021

December 31, 2020

1 unchanged sentence

Less reserve for obsolete inventory

the nine months ended September 30, 2020 and the year ended December 31, 2019, the Company did not make any change for reserve

for obsolete inventory.

the three months ended March 31, 2021 and the year ended December 31, 2020, the Company did not make any change for reserve for

obsolete inventory.

PREPAID EXPENSES

expenses amounted to $1,784 at September 30, 2020 and $18,596 at December 31, 2019, respectively.

Prepaid expenses include prepayments

in cash for accounting fees, prepayments in equity instruments, which are being amortized over the terms of their respective agreements,

as well as cost associated with certain contract liabilities.

The current portion consists of costs paid for future services which

will occur within a year.

expenses amounted to $1,784 at March 31, 2021 and at December 31, 2020.

Prepaid expenses include prepayments in cash for accounting

fees, prepayments in equity instruments, which are being amortized over the terms of their respective agreements, as well as cost

associated with certain contract liabilities.

The current portion consists of costs paid for future services which will occur

within a year.

5 - PROPERTY AND EQUIPMENT

September 30, 2020 and December 31, 2019, property and equipment, net of fully depreciated assets, consisted of the following:

September 30, 2020

March 31, 2021 and December 31, 2020, property and equipment, net of fully depreciated assets, consisted of the following:

March 31, 2021

December 31, 2020

4 unchanged sentences

Less accumulated depreciation

expense for the three months ended September 30, 2020 and 2019 were $67,447 and $62,859, respectively.

Depreciation expense for

the nine months ended September 30, 2020 and 2019 were $199,242 and $184,484, respectively.

expense was $67,450 and $65,254 for the three months ended March 31, 2021 and 2020, respectively.

INTANGIBLE ASSETS

12 unchanged sentences

(i) the rights and benefits granted to GTC under each of the Globalstar Contracts, subject to certain

exclusions, (ii) account and online access to the Globalstar Cody Simplex activation system, (iii) GTC’s existing customers

who are serviced pursuant to the Globalstar Contracts (only as to their business directly and exclusively related to the Globalstar

Contracts), and (iv) all of GTC’s rights and benefits directly and exclusively related to the Globalstar Contracts.

exclusions, (ii) account and online access to

the Globalstar Cody Simplex activation system, (iii) GTC’s existing customers who are serviced pursuant to the Globalstar

Contracts (only as to their business directly and exclusively related to the Globalstar Contracts), and (iv) all of GTC’s

rights and benefits directly and exclusively related to the Globalstar Contracts.

of customer contracts are included in depreciation and amortization.

For the nine months ended September 30, 2020 and 2019, the

Company amortized $18,750, respectively.

For the three months ended March 31, 2021 and 2020, the Company

amortized $6,250, respectively.

Future amortization of intangible assets is as follows:

2024 and thereafter

February 19, 2015, the Company issued 444 of its common stock, par value $0.0001, at $112.50 per share, or $50,000, to a consultant

as compensation for the design and delivery of dual mode gsm/Globalstar Simplex tracking devices and related hardware and intellectual

For the year ended December 31, 2019, the Company recorded an impairment charge of $50,000 for the above-mentioned other

asset, due to the delay in its launch to our existing product lines.

For the nine months ended September 30, 2020 and 2019, there

were no additional expenditures on research and development.

the three months ended March 31, 2021 and 2020, there were no additional expenditures on research and development.

7 - ACCOUNTS PAYABLE AND ACCRUED OTHER LIABILITIES

payable and accrued other liabilities consisted of the following:

September 30, 2020

March 31, 2021

December 31, 2020

3 unchanged sentences

Accrued wages & payroll liabilities

Property tax payable

VAT liability & sales tax payable

6 unchanged sentences

is paid monthly, has an interest rate of 9.72%, with late payment penalty interest of 11.72%.

For the nine months ended September

For the three months ended March

31, 2021 and 2020, the Company recorded interest expense of $0 and $467, respectively.

The short-term line of credit balance as

of September 30, 2020 and December 31, 2019, was $4,798 and $24,483, respectively.

of March 31, 2021 and December 31, 2020, was $0 and $0.

CORP AND SUBSIDIARIES

16 unchanged sentences

The Company may prepay the Notes at any time.

the fiscal year ended December 31, 2019, the Company repaid $46,422 of the notes, leaving a balance of $121,848 as long-term notes

For the three months ended September 30, 2020 and 2019, the Company recorded interest of $1,843 and $1,843, respectively.

For the nine months ended September 30, 2020 and 2019, the Company recorded interest in relation to the note of $5,488 and $3,065,

respectively.

As of September 30, 2020, the company reclassified the note from long term to short term, resulting in current portion

of notes payable of $121,848.

the periods ended March 31, 2021 and December 31, 2020, the Company repaid $60,643 and $0 of the notes, leaving a balance of $58,255

and $121,848, respectively as short-term notes payable.

For the three months ended March 31, 2021, the Company recorded interest

in relation to the note of $1,594.

CORP AND SUBSIDIARIES

3 unchanged sentences

notes payable –

May 14, 2019 (the “Issue Date”), the Company entered into a Note Purchase Agreement (the “NPA”) by and

among the Company and the lenders set forth on the lender schedule to the NPA (the “Lenders”), as amended by that

certain Amendment to Note Purchase Agreement (the “Amendment,”

and, together with the NPA, the “Agreement”)

by and among the Company and the Lenders.

In total, pursuant to the Agreement, the Company issued an aggregate principal amount

of $805,000 of its convertible promissory notes (the “Notes”).

Notes bear interest at a rate of 6% per annum, simple interest, and mature on the third anniversary of the Issue Date (the “Maturity

Date”), to the extent that the Notes and the principal amounts and any interest accrued thereunder (the “Indebtedness”)

have not been converted into shares of common stock of the Company.

Interest on the Notes will accrue on a simple interest, non-compounded

basis and will be added to the principal amounts on the Maturity Date or such earlier date as may be due upon an Event of Default

(as defined below), at which time all Indebtedness will be due and payable, unless earlier converted into Conversion Shares (as

defined below).

In the event that any amount due under the Notes is not paid as and when due, such amounts will accrue interest

at the rate of 12% per year, simple interest, non-compounding, until paid.

The Company may not pre-pay or redeem the Notes other

than as required by the Agreement.

The Notes are general, unsecured obligations of the Company.

The proceeds of the Notes will

be used to repay certain outstanding indebtedness of the Company and for general corporate purposes.

For the three months ended

September 30, 2020, the Company recorded simple interest expense of $11,191 and $0, respectively.

For the nine months ended September

30, 2020 and 2019, the Company recorded simple interest expense of $34,452 and $87,779, respectively.

holders of the Notes (the “Holders”) have an optional right of conversion.

A Holder may elect to convert its Note,

and all of the Indebtedness outstanding as of such time, into the number of fully paid and non-assessable shares of Common Stock

(the “Conversion Shares”) as determined by dividing the Indebtedness by $0.10, subject to certain adjustments, but

excluding adjustment for a reserve stock split of no more than 1:20 contemplated by the Company at the Issue Date.

right of conversion is subject to a beneficial ownership limitation of 4.99% of the number of shares of Common Stock outstanding

immediately after giving effect to the issuance of shares of Common Stock issuable upon conversion.

Agreement contains customary representations and warranties and customary affirmative and negative covenants.

These covenants

include, among other things, certain limitations on the ability of the Company to:

(i) pay dividends on its capital stock;

make distributions in respect of its capital stock;

(iii) acquire shares of capital stock;

and, (iv) sell, lease or dispose of

Pursuant to the Agreement, the Holders are granted demand registration rights and pre-emptive rights as set forth in the

The Agreement includes customary events of default, including, among others:

(i) non-payment of amounts due thereunder,

(ii) non-compliance with covenants thereunder, (iii) bankruptcy or insolvency (each, an “Event of Default”).

the occurrence of an Event of Default, a majority of the Holders may accelerate the maturity of the Indebtedness.

June 15, 2020, Orbsat Corp (the “Company”) and the holders of the majority convertible promissory notes sold by the

Company in the May 2019 private offering agreed to amend certain terms and provisions of the Note Purchase Agreement dated as

of May 13, 2019 (the “NPA”) and related convertible promissory notes (the “Notes”) consistent with the

terms of such instruments as follows:

amend Section 2 of the Notes to allow the Company to pre-pay or redeem such Notes, with mutual consent of the parties to the

amend Section 3(a) of the Notes to change the “Conversion Price”

from $0.10 per share to $0.20 per share;

amend Section 4 the beneficial ownership limitation upon conversion of the Notes from 4.99% to 9.99%;

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

amend Section 6.1 of the NPA to add “Most Favored Nation”

provision such that for a period beginning on the closing

date and ending two years thereafter, if the Company issues any common stock or securities convertible into or exercisable

for shares of common stock or modify any of the foregoing which may be outstanding to any person or entity at a price per

share or conversion or exercise price per share which shall be less than $0.20 per share, the “Lower Price Issuance”,

then the Company will issue such additional units such that the subscriber/lender, will hold that number of units in total

had subscriber/lender purchased the units with the purchase price equal to the lower price issuance common stock issued or

issuable by the Company, notwithstanding anything herein or in any other agreement to the contrary, the Company should only

be required to make a single adjustment with respect to any lower price issuance regardless of the existence of multiple bases;

6.2(b) of the NPA to waive a negative covenant to allow the Company to issue up to 100,000 shares of its common stock as compensation

for services to various service providers, consultants, etc.;

6.2(c) of the NPA to waive a negative covenant to allow the Company to put into place an employee stock option plan, or a

similar plan, to grant equity in the Company to its officers, directors and employees.

comparison to the fair market value of the common stock on May 14, 2019, and the fixed effective conversion rate of $0.10 per

common share, the lesser amount of the conversion feature or debt was $805,000 and presented a beneficial conversion feature.

Thus, the Company recorded a discount on the debt of $805,000 with a corresponding increase to additional paid in capital.

the year ended December 31, 2019, we amortized the discount on the debt, to interest expense of $169,668, resulting in a balance

of unamortized discount notes payable of $635,333.

June 15, 2020, the change in conversion price from $0.10 to $0.20, resulted in a difference in the carrying value of the balance

of the note payable.

Under ASC 470-50-40-13, if it is determined that the original and new debt instruments are substantially

different, the new debt instrument shall be initially recorded at fair value, and that amount shall be used to determine the debt

extinguishment gain or loss to be recognized and the effective rate of the new instrument.

The original debt had a carrying value

of $269,262 as of June 15, 2020, the fair value of the amended debt was $0 ($792,932 principle netted with the $792,392 note payable

discount), which resulted a gain from the extinguishment of debt $269,262.

Further, as of June 30, 2020, the Company recorded

a beneficial conversion feature of the amended note of $17,041, resulting in a balance of unamortized discount notes payable of

$775,892 as of June 30, 2020.

For the three months ended September 30, 2020, the Company amortized the discount on the debt, to

interest expense of $348,563, resulting in a balance of unamortized discount notes payable of $427,329.

August 21, 2020, Orbsat Corp (the “Company”) entered into a Note Purchase Agreement (the “NPA2”) by and

among the Company and certain lenders set forth on the lender schedule to the NPA2 (the “Lenders”).

Pursuant to the

terms of the NPA2, the Company sold an aggregate principal amount of $933,000 of its convertible promissory notes (the “Notes”).

The Notes are general, unsecured obligations of the Company and bear simple interest at a rate of 6% per annum, and mature on

the third anniversary of the date of issuance (the “Maturity Date”), to the extent that the Notes and the principal

amounts and any interest accrued thereunder have not been converted into shares of the Company’s common stock.

that any amount due under the Notes is not paid as and when due, such amounts will accrue interest at the rate of 12% per year,

simple interest, non-compounding, until paid.

The Company may not pre-pay or redeem the Notes other than as required by the Agreement.

The Note holders have an optional right of conversion such that a Noteholder may elect to convert his Note, in whole or in part,

outstanding as of such time, into the number of fully paid and non-assessable shares of the Company’s common stock as determined

by dividing the outstanding indebtedness by $0.20, subject to certain adjustments.

This optional right of conversion is subject

to a beneficial ownership limitation of 9.99% of the number of shares of the Company’s common stock outstanding immediately

after giving effect to the share issuance upon conversion.

The holders of the Notes are granted demand registration rights and

pre-emptive rights.

In addition, the NPA2 includes customary events of default, including, among others:

(i) non-payment of amounts

due thereunder, (ii) non-compliance with covenants thereunder, (iii) bankruptcy or insolvency.

Upon the occurrence of an event

of default, a majority of the Holders may accelerate the maturity of the Indebtedness.

The closing of this offering took place

on August 21, 2020.

comparison to the fair market value of the common stock on August 21, 2020, and the fixed effective conversion rate of $0.20 per

common share, the lesser amount of the conversion feature or debt was $898,918 and presented a beneficial conversion feature.

Thus, the Company recorded a discount on the debt of $898,918 with a corresponding increase to additional paid in capital.

the three months ended, the Company amortized the discount on the debt, to interest expense of $274,865, resulting in a balance

of unamortized discount notes payable of $624,053.

the nine months ended September 30, 2020, the Holders converted a total of $585,589 of the convertible debt to common stock into

2,988,283 common shares, 120,676 at the conversion rate of $0.10 per share and 2,867,607 common shares at the conversion rate

of $0.20 per share.

The balance of the convertible notes at September 30, 2020, net of unamortized discount of $1,051,382,

2021 Financing

March 5, 2021, the Company entered into a Note Purchase Agreement (the “March 2021 NPA”) by and between the Company and one

individual accredited investor (the “Lender”).

Pursuant to the terms of the March 2021 NPA, the Company sold a convertible

promissory note with a principal amount of $350,000 (the “March 2021 Note”).

The March 2021 Note is a general, unsecured

obligation of the Company and bears simple interest at a rate of 7% per annum, and matures on the third anniversary of the date of issuance

(the “Maturity Date”), to the extent that the March 2021 Note and the principal amount and any interest accrued thereunder

have not been converted into shares of the Company’s common stock.

In the event that any amount due under the March 2021 Note is

not paid as and when due, such amount will accrue interest at the rate of 12% per year, simple interest, non-compounding, until paid.

The Company may not pre-pay or redeem the March 2021 Note other than as required by the Agreement.

The Noteholder have an optional right

of conversion such that a Noteholder may elect to convert his March 2021 Note, in whole or in part, outstanding as of such time, into

the number of fully paid and non-assessable shares of the Company’s common stock as determined by dividing the indebtedness under

the March 2021 Note price equal to the lesser of (a) $1.50 per share, and (b) a 30% discount to the price of the common stock in the

qualified transaction.

Following an event of default, the conversion price shall be adjusted to be equal to the lower of:

applicable conversion price or (ii) the price per share of 85% of the lowest traded price for the Company’s common stock during

the 15 trading days preceding the relevant conversion.

In addition, subject to the ownership limitations, if a qualified transaction

is completed, without further action from the Noteholder, on the closing date of the qualified transaction, 50% of the principal amount

of this March 2021 Note and all accrued and unpaid interest shall be converted into Company common stock at a conversion price equal

to the 30% discount to the offering price in such qualified transaction, which price shall be proportionately adjusted for stock splits,

stock dividends or similar events.

A “Qualified Transaction”

refers the completion of the public offering of the Company’s

securities stock with gross proceeds of at least $10,000,000 pursuant to which the Company’s securities become registered pursuant

to Section 12(b) of the Securities Exchange Act of 1934, as amended, or a merger with a company listed on the Nasdaq or Canadian stock

exchanges, as amended.

The Noteholder is granted registration rights and pre-emptive rights.

In addition, the March 2021 NPA includes

customary events of default, including, among others:

(i) non-payment of amounts due thereunder, (ii) non-compliance with covenants thereunder,

(iii) bankruptcy or insolvency.

The Company’s issuance of the March 2021 Note under the terms of the March 2021 NPA was made pursuant

to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”) in reliance on Section

4(a)(2) of the Securities Act as a transaction by an issuer not involving a public offering.

The investor in the March 2021 Note is an

“accredited investor”

as such term is defined in Rule 501(a) of Regulation D under the Securities Act.

There were no discounts

or brokerage fees associated with this offering.

The Company used the offering proceeds for working capital and general corporate purposes.

As of March 31, 2021, the balance of the March 2021 Note is $350,000 which could convert into approximately 233,333 shares of common

balances of the Company’s convertible notes payable consist of the following:

March 31, 2021

December 31, 2020

May 2019 Notes

August 2020 Notes

December 2020 Notes

March 2021 Notes

Debt Discount

the three months ended March 31, 2021 and 2020, we amortized the discount on the debt, to interest expense of $501,164 and $74,837.

the three months ended March 31, 2021 and 2020, the Holders converted a total of $458,091 and $11,315 of the convertible debt

to 2,092,186 and 113,260 shares of common shares.

CORP AND SUBSIDIARIES

5 unchanged sentences

and has a term of 2 years, of which the first 6 months are deferred at an interest rate of 1%.

As of September 30, 2020,

the Company has recorded $13,020 as current portion of notes payable and $7,812 as notes payable long term.

April 20, 2020, the Board of Directors of Orbsat Corp (the “Company”), approved for its wholly owned UK subsidiary,

Global Telesat Communications LTD (“GTC”), to apply for a Coronavirus Interruption Loan, offered by the UK government,

for an amount up to £250,000.

On July 16, 2020 (the “Issue Date”), GTC, entered into a Coronavirus Interruption

Loan Agreement (“Debenture”) by and among the Company and HSBC UK Bank PLC (the “Lender”) for an amount

of £250,000, or USD$313,875 at an exchange rate of GBP:USD of 1.2555.

The Debenture bears interest at a rate of 3.99% per

annum over the Bank of England Base Rate (0.1% as of July 16, 2020), payable monthly on the outstanding principal amount of the

The Debenture has a term of 6 years from the date of drawdown, July 15, 2026, the “Maturity Date”.

first repayment of £4,166.67 (exclusive of interest) will be made 13 month(s) after July 16, 2020.

Voluntary prepayments

are allowed with 5 business days’

written notice and the amount of the prepayment is equal to 10% or more of the Limit or,

if less, the balance of the debenture.

The Debenture is secured by all GTC’s assets as well as a guarantee by the UK government,

with the proceeds of the Debenture are to be used for general corporate and working capital purposes.

The Debenture includes customary

events of default, including, among others:

(i) non-payment of amounts due thereunder, (ii) non-compliance with covenants thereunder,

(iii) bankruptcy or insolvency (each, an “Event of Default”).

Upon the occurrence of an Event of Default, the Debenture

becomes payable upon demand.

As of March 31, 2021, the Company has

recorded $19,096 as current portion of notes payable and $1,736 as notes payable long term.

In May 2021, the Company applied for forgiveness

of the full amount due on the PPP loan.

April 20, 2020, the Board of Directors the Company, approved for its wholly owned UK subsidiary, Global Telesat Communications LTD (“GTC”),

to apply for a Coronavirus Interruption Loan, offered by the UK government, for an amount up to £250,000.

On July 16, 2020 (the

“Issue Date”), GTC, entered into a Coronavirus Interruption Loan Agreement (“Debenture”) by and among the Company

and HSBC UK Bank PLC (the “Lender”) for an amount of £250,000, or USD$344,575 at an exchange rate of GBP:USD of 1.3783.

The Debenture bears interest beginning July 16, 2021, at a rate of 3.99% per annum over the Bank of England Base Rate (0.1% as of July

16, 2020), payable monthly on the outstanding principal amount of the Debenture.

The Debenture has a term of 6 years from the date of

drawdown, July 15, 2026, the “Maturity Date”.

The first repayment of £4,167 (exclusive of interest) will be made 13

month(s) after July 16, 2020.

Voluntary prepayments are allowed with 5 business days’

written notice and the amount of the prepayment

is equal to 10% or more of the limit or, if less, the balance of the debenture.

The Debenture is secured by all GTC’s assets as

well as a guarantee by the UK government, with the proceeds of the Debenture are to be used for general corporate and working capital

The Debenture includes customary events of default, including, among others:

(i) non-payment of amounts due thereunder, (ii)

non-compliance with covenants thereunder, (iii) bankruptcy or insolvency (each, an “Event of Default”).

Upon the occurrence

of an Event of Default, the Debenture becomes payable upon demand.

As of March 31, 2021, the Company has recorded $51,686 as current

portion of notes payable and $292,889 as notes payable long term.

12 - STOCKHOLDERS’

March 28, 2014, in connection with the Reincorporation (see Note 1), all share and per share values for all periods presented

in the accompanying condensed consolidated financial statements are retroactively restated for the effect of the Reincorporation.

March 5, 2016, the Company shareholders voted in favor of an amendment to its Articles of Incorporation to increase the total

number of shares of authorized capital stock to 800,000,000 shares consisting of (i) 750,000,000 shares of common stock and (ii)

50,000,000 shares of preferred stock from 220,000,000 shares consisting of (i) 200,000,000 shares of common stock and (ii) 20,000,000

shares of preferred stock.

March 28, 2014, in connection with the Reincorporation (see Note 1), all share and per share values for all periods presented in the

accompanying condensed consolidated financial statements are retroactively restated for the effect of the Reincorporation.

March 5, 2016, the Company shareholders voted in favor of an amendment to its Articles of Incorporation to increase the total number

of shares of authorized capital stock to 800,000,000 shares consisting of (i) 750,000,000 shares of common stock and (ii) 50,000,000

shares of preferred stock from 220,000,000 shares consisting of (i) 200,000,000 shares of common stock and (ii) 20,000,000 shares of

preferred stock.

March 8, 2018, we conducted a reverse split of our common stock at a ratio of 1 for 150.

All share and per share information in

the accompanying condensed consolidated financial statements and footnotes has been retroactively restated to reflect the reverse

July 24, 2019, the Company filed a Certificate of Change (the “Certificate of Change”) with the Nevada Secretary of

The Certificate of Change provides for (i) a 1-for-15 reverse split (the “Reverse Split”) of the Company’s

common stock, $0.0001 par value per share, and the Company’s preferred stock, $0.0001 par value per share, (ii) a reduction

in the number of authorized shares of common stock in direct proportion to the Reverse Split (i.e.

from 750,000,000 shares to

50,000,000 shares), and (iii) a reduction in the number of authorized shares of preferred stock in direct proportion to the Reverse

from 50,000,000 shares to 3,333,333 shares).

All share and per share information in the accompanying

condensed consolidated financial statements and footnotes has been retroactively restated to reflect the reverse split.

July 24, 2019, the Company filed a Certificate of Change (the “Certificate of Change”) with the Nevada Secretary of State.

The Certificate of Change provides for (i) a 1-for-15 reverse split (the “Reverse Split”) of the Company’s common stock,

$0.0001 par value per share, and the Company’s preferred stock, $0.0001 par value per share, (ii) a reduction in the number of

authorized shares of common stock in direct proportion to the Reverse Split (i.e.

from 750,000,000 shares to 50,000,000 shares), and

(iii) a reduction in the number of authorized shares of preferred stock in direct proportion to the Reverse Split (i.e.

from 50,000,000

shares to 3,333,333 shares).

No fractional shares will be issued in connection with the Reverse Split.

Stockholders who otherwise would be entitled to receive fractional shares of common stock or preferred stock, as the case may

be, will have the number of post-Reverse Split shares to which they are entitled rounded up to the nearest whole number of shares.

No stockholders will receive cash in lieu of fractional shares.

Stockholders who otherwise would

be entitled to receive fractional shares of common stock or preferred stock, as the case may be, will have the number of post-Reverse

Split shares to which they are entitled rounded up to the nearest whole number of shares.

No stockholders will receive cash in lieu of

fractional shares.

The Reverse Split was approved by FINRA on August 19, 2019.

2 unchanged sentences

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

authorized capital of the Company consists of 50,000,000 shares of common stock, par value $0.0001 per share and 3,333,333 shares

of preferred stock, par value $0.0001 per share, as of September 30, 2020.

of September 30, 2020, there were 3,333,333 shares of Preferred Stock authorized.

December 5, 2017, pursuant to the approval of our board of directors and a majority of the shareholders in each class, we amended

the Certificates of Designation for our Series C, D, E, H, I, J, and K Preferred Stock.

The amendments changed the conversion

rights of these classes of preferred stock such that the Maximum Conversion as defined in each such Certificate of Designation

was increased from 4.99% to 9.99% of our outstanding shares of common stock.

May 20, 2019, following the approval on May 14, 2019, of the board of directors the Company and a majority of the shareholders

of the Series E preferred stock, the Company filed an Amended and Restated Certificate of Designations for the Company’s

Series E preferred stock.

The amendments had the effect of changing the conversion rights such that the 9.99% blocker was eliminated.

July 12, 2019, pursuant to the approval of our board of directors and a majority of the shareholders in each class, we amended

the Certificates of Designation for our Series E, I and L Preferred Stock.

The amendments had the effect of authorizing the Company’s

Board to require the conversion of the Series E, I and L preferred stock into common stock of the Company at the then-applicable

conversion ratio, without the approval of any holders of Series E, I and L preferred stock.

on July 12, 2019, the Company filed Certificates of Withdrawal of Certificate of Designations for the Company’s Series A,

B, C, D, F, G, H and J preferred stock, pursuant to which the Series A, B, C, D, F, G, H and J preferred stock was cancelled.

July 15, 2019, the Company filed a Certificate of Withdrawal of Certificate of Designations (the “Series K Certificate”)

for the Company’s Series K preferred stock, pursuant to which the Series K preferred stock was cancelled.

July 18, 2019, the Company filed Certificates of Withdrawal of Designations for the Company’s Series E, I and L preferred

stock, pursuant to which the Series E, I and L preferred stock was cancelled.

of September 30, 2020, there were no shares of Series A, B, C, D, E, F, G, H, I, J, K and L convertible preferred stock authorized,

and no shares issued and outstanding.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

of September 30, 2020, there were 50,000,000 shares of common stock authorized and 3,564,299 shares issued and outstanding.

January 30, 2020, the Company issued an aggregate of 18,147 common stock upon the conversion of $1,815 of its convertible debt,

at the conversion rate of $0.10 per share.

January 31, 2020, the Company issued an aggregate of 18,147 common stock upon the conversion of $1,815 of its convertible debt,

at the conversion rate of $0.10 per share.

February 10, 2020, the Company issued an aggregate of 25,421 common stock upon the conversion of $2,542 of its convertible debt,

at the conversion rate of $0.10 per share.

February 11, 2020, the Company issued an aggregate of 23,580 common stock upon the conversion of $2,358 of its convertible debt,

at the conversion rate of $0.10 per share.

February 18, 2020, the Company issued an aggregate of 13,192 common stock upon the conversion of $1,319 of its convertible debt,

at the conversion rate of $0.10 per share.

authorized capital of the Company consists of 50,000,000 shares of common stock, par value $0.0001 per share and 3,333,333 shares of

preferred stock, par value $0.0001 per share, as of March 31, 2021.

of March 31, 2021, there were 3,333,333 shares of Preferred Stock authorized.

of March 31, 2021, there were no shares of Series A, B, C, D, E, F, G, H, I, J, K and L convertible preferred stock authorized, and no

shares issued and outstanding.

of March 31, 2021, there were 50,000,000 shares of common stock authorized and 6,177,203 shares issued and outstanding.

February 19, 2021, the Board of Directors of the Company unanimously adopted an amendment to the Company’s Articles of Incorporation

to effect a reverse stock split at a ratio of (i) no less than 1-for-2 shares of Common Stock, and (ii) no more than 1-for-5 shares of

Common Stock, the exact ratio to be determined in the sole discretion of the Board of Directors, at any time before August 31, 2021.

The Board of Directors has obtained (by written consent) the approval of the Company’s stockholders who, in the aggregate, own

2,686,337 shares of Common Stock, or 63.5% of the outstanding shares of Common Stock of the Company prior to the Reverse Split Action.

January 12, 2021, the Company issued an aggregate of 150,000 common stock upon the conversion of $30,000 of its convertible debt, at

the conversion rate of $0.20 per share.

February 23, 2021, the Company issued an aggregate of 401,446 common stock upon the conversion of $80,289 of its convertible debt,

at the conversion rate of $0.20 per share.

March 9, 2020, the Company issued an aggregate of 10,305 common stock upon the conversion of $1,031 of its convertible debt, at

the conversion rate of $0.10 per share.

April 17, 2020, the Company issued an aggregate of 7,046 common stock upon the conversion of $705 of its convertible debt, at

the conversion rate of $0.10 per share.

April 22, 2020, the Company issued an aggregate of 370 common stock upon the conversion of $37 of its convertible debt, at the

conversion rate of $0.10 per share.

June 22, 2020, the Company issued an aggregate of 13,437 common stock upon the conversion of $2,687 of its convertible debt, at

February 23, 2021, the Company issued an aggregate of 600,000 common stock upon the conversion of $150,000 of its convertible debt, at

the conversion rate of $0.25 per share.

July 8, 2020, the Company issued an aggregate of 1,095 common stock upon the conversion of $219 of its convertible debt, at the

conversion rate of $0.20 per share.

July 16, 2020, the Company’s Board of Directors approved and the Company entered into a 12-month consulting agreement (“Consulting

Agreement”) with an unrelated third-party for capital raising advisory services and business growth and development services,

with the term renewable upon mutual consent of the parties.

Upon signing of the Consulting Agreement, the Company agreed to issue

20,000 restricted shares of its common stock to the consultant (the “Consulting Shares”), 5,000 additional restricted

shares of common stock to be issued quarterly until the consultant may receive cash compensation for its services, which will

be determined, upon completion of certain milestones, by the Company’s CEO.

July 23, 2020, the Company issued an aggregate of 2,342 common stock upon the conversion of $468 of its convertible debt, at the

conversion rate of $0.20 per share.

August 26, 2020, the Company issued an aggregate of 586,000 common stock upon the conversion of $117,200 of its convertible debt,

at the conversion rate of $0.20 per share.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 1, 2020, the Company issued an aggregate of 148,424 common stock upon the conversion of $29,685 of its convertible debt,

at the conversion rate of $0.20 per share.

September 2, 2020, the Company issued an aggregate of 21,753 common stock upon the conversion of $4,351 of its convertible debt,

at the conversion rate of $0.20 per share.

September 8, 2020, the Company issued an aggregate of 167,998 common stock upon the conversion of $33,600 of its convertible debt,

at the conversion rate of $0.20 per share.

September 10, 2020, the Company issued an aggregate of 572,285 common stock upon the conversion of $114,457 of its convertible

debt, at the conversion rate of $0.20 per share.

September 11, 2020, the Company issued an aggregate of 75,000 common stock upon the conversion of $15,000 of its convertible debt,

at the conversion rate of $0.20 per share.

September 14, 2020, the Company issued an aggregate of 331,472 common stock upon the conversion of $66,294 of its convertible

debt, at the conversion rate of $0.20 per share.

September 15, 2020, the Company issued an aggregate of 67,647 common stock upon the conversion of $13,529 of its convertible debt,

at the conversion rate of $0.20 per share.

September 16, 2020, the Company issued an aggregate of 151,373 common stock upon the conversion of $30,275 of its convertible

debt, at the conversion rate of $0.20 per share.

September 17, 2020, the Company issued an aggregate of 165,985 common stock upon the conversion of $33,197 of its convertible

debt, at the conversion rate of $0.20 per share.

September 21, 2020, the Company issued an aggregate of 28,901 common stock upon the conversion of $5,780 of its convertible debt,

at the conversion rate of $0.20 per share.

September 22, 2020, the Company issued an aggregate of 275,026 common stock upon the conversion of $55,005 of its convertible

February 23, 2021, the Company issued an aggregate of 5,000 common stock for services in the amount of $14,200.

March 1, 2021, the Company issued an aggregate of 747,658 common stock upon the conversion of $149,532 of its convertible

debt, at the conversion rate of $0.20 per share.

September 30, 2020, the Company issued an aggregate of 216,199 common stock upon the conversion of $43,240 of its convertible

March 1, 2021, the Company issued an aggregate of 193,082 common stock upon the conversion of $48,270 of its convertible

debt, at the conversion rate of $0.25 per share.

Incentive Plan

June 14, 2018, our Board of Directors approved the 2018 Incentive Plan (the “Plan”).

The 2014 Equity Incentive Plan

was closed and superseded by the 2018 Incentive Plan.

The purpose of the Plan is to provide a means for the Company to continue

to attract, motivate and retain management, key employees, consultants and other independent contractors, and to provide these

individuals with greater incentive for their service to the Company by linking their interests in the Company’s success

with those of the Company and its shareholders.

An Award may also be granted to any consultant, agent, advisor or independent

contractor for bona fide services rendered to the Company or any Related Company that;

are not in connection with the offer and

sale of the Company’s securities in a capital raising transaction, and do not directly or indirectly promote or maintain

a market for the Company’s securities.

The Plan shall be administered by the Board or its Compensation Committee and may

grant Options designated as Incentive Stock Options or Nonqualified Stock Options.

The Plan provides that up to a maximum of 66,667

shares of the Company’s common stock (subject to adjustment) are available for issuance under the Plan.

Subject to earlier

termination in accordance with the terms of the Plan and the instrument evidencing the Option, the maximum term of an Incentive

Stock Option shall not exceed ten years, and in the case of an Incentive Stock Option granted to a Ten Percent Stockholder, shall

not exceed five years.

Any portion of an Option that is not vested and exercisable on the date of a Participant’s Termination

of Service shall expire on such date.

In the event of a Change in Control;

all outstanding Awards, other than Performance Shares

and Performance Units, shall become fully and immediately exercisable, and all applicable deferral and restriction limitations

or forfeiture provisions shall lapse, immediately prior to the Change in Control and shall terminate at the effective time of

the Change in Control;

provided, however, that with respect to a Change in Control that is a Company Transaction, such Awards

shall become fully and immediately exercisable, and all applicable deferral and restriction limitations or forfeiture provisions

shall lapse, only if and to the extent such Awards are not converted, assumed or replaced by the Successor Company.

CORP AND SUBSIDIARIES

1 unchanged sentence

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

exercise price of an Incentive Stock Option shall be at least 100% of the Fair Market Value of the Common Stock on the Grant Date,

and in the case of an Incentive Stock Option granted to a Participant who owns more than 10% of the total combined voting power

of all classes of the stock of the Company or of its parent or subsidiary corporations (a “Ten Percent Stockholder”),

shall not be less than 110% of the Fair Market Value of the Common Stock on the Grant Date.

As of December 31, 2018, Mr.

Phipps, is a Ten Percent Stockholder.

The determination of more than 10% ownership shall be made in accordance with Section 422

To the extent the aggregate Fair Market Value (determined as of the Grant Date) of Common Stock with respect to which

a Participant’s Incentive Stock Options become exercisable for the first time during any calendar year (under the Plan and

all other stock option plans of the Company and its parent and subsidiary corporations) exceeds $100,000, such portion in excess

of $100,000 shall be treated as a Nonqualified Stock Option.

June 14, 2018, we issued 18,333 new stock options to our executives and directors under the 2018 Incentive Plan.

All options issued

have an exercise price of $22.50 per share, with the exception of David Phipps, a Ten Percent Stockholder, whose exercise price

is $24.00, vest in equal quarterly instalments starting July 1, 2018 over the next two years and expire on July 1, 2021.

year ended December 31, 2018, the amount of vested options was 4,583.

On July 1, 2018, 2,292 options were fully vested and valued

on the vesting date at approximately $20.70 per option or a total of $47,422 using a Black-Scholes option pricing model with the

following assumptions:

strike price of 22.50 stock price of $20.70 per share (based on the market price at close on July 1, 2018)

volatility of 718%, expected term of 3 years, and a risk-free interest rate of 2.69%.

On October 1, 2018, an additional 2,292

options were fully vested and valued on the vesting date at approximately $20.70 per option or a total of $47,422 using a Black-Scholes

option pricing model with the following assumptions:

stock price of $20.70 per share (based on the market price close at grant

date on June 14, 2018) volatility of 607%, expected term of 3 years, and a risk-free interest rate of 2.64%.

In reference to this

grant, the company recorded stock-based compensation of $81,698 for the year ended December 31, 2018.

December 18, 2018, the Company cancelled the unvested portion of options previously granted on June 14, 2018, under the 2018 Incentive

Plan totaling 13,750.

The grants cancelled will be returned to the Plan.

number of options cancelled to our officers and directors were as follows:

David Phipps, President, CEO, and Director

Theresa Carlise, CFO

Hector Delgado, Director

addition, we cancelled options to purchase a total of (5,000) shares to two key employees.

December 18, 2018, we issued 55,417 new stock options to our executives and directors under the 2018 Incentive Plan.

issued have an exercise price of $2.25 per share, with the exception of David Phipps, a Ten Percent Stockholder, whose exercise

price is $2.55, are fully vested and expire on December 17, 2023.

The options were valued on the grant date at approximately $2.25

per option or a total of $124,674 using a Black-Scholes option pricing model with the following assumptions:

strike price of $2.25

stock price of $2.25 per share (based on the market price at close on December 17, 2018) volatility of 773%, expected term of

5 years, and a risk-free interest rate of 2.69%.

January 18, 2019, David Phipps exercised 21,667 options via a cashless exercise.

Additionally, on January 18, 2019, two employees

exercised 18,333 options through a cashless exercise.

The Company withheld newly acquired shares pursuant to the exercise of the

The amount of common stock issued is calculated by using [Number of Options Exercising] minus [Exercise Price]

* [Number of Options Exercising] divided by [Prior Close OSAT Market Price].

As a result of the exercise 21,619

shares of common stock were issued.

Incentive Plan

August 21, 2020, the Company’s Board of Directors approved and adopted the Company’s 2020 Equity Incentive Plan (the

“2020 Plan”).

The purpose of the 2020 Plan is to provide a means for the Company to continue to attract, motivate

and retain management, key employees, directors and consultants.

The 2020 Plan provides that up to a maximum of 2,250,000 shares

of the Company’s common stock, subject to adjustment, are available for issuance under the 2020 Plan.

A copy of the 2020

Plan is filed as Exhibit 10.2 to this Form 8-K and is incorporated by reference herein.

the adoption of the 2020 Plan, the Board approved issuances of certain stock options to its executives, directors and employees

under the 2020 Plan.

Specifically, the stock options issued to David Phipps, CEO (400,000), Theresa Carlise, former CFO (71,000)

and Hector Delgado, a Board member (21,000), all have an exercise price of $0.20 per share, respectively, fully vest upon issuance

and expire on August 20, 2030.

In addition, the Board approved additional 160,000 stock options to the Company’s 7 key employees,

on the same terms as those issued to the Company’s officers and director.

August 25, 2020, David Phipps exercised 400,000 options via a cashless exercise.

Additionally, on August 25, 2020, two employees

exercised 110,000 options through a cashless exercise.

The Company withheld newly acquired shares pursuant to the exercise of

The amount of common stock issued is calculated by using [Number of Options Exercising] minus [Exercise Price]

* [Number of Options Exercising] divided by [Prior Close OSAT Market Price].

As a result of the exercise 408,000

shares of common stock were issued.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Issued Outside of Plan

February 19, 2015, the Company issued to Mr.

Rector, the former Chief Executive Officer, Chief Financial Officer and director

of the Company, a seven-year option to purchase 956 shares of common stock as compensation for services provided to the Company.

The options have an exercise price of $112.50 per share, were fully vested on the date of grant and shall expire in February 2022.

The 956 options were valued on the grant date at approximately $112.50 per option or a total of $107,500 using a Black-Scholes

option pricing model with the following assumptions:

stock price of $112.50 per share (based on the sale of common stock in a

private placement), volatility of 380%, expected term of 7 years, and a risk-free interest rate of 1.58%.

In connection with the

stock option grant, the Company recorded stock-based compensation for the year ended December 31, 2015 of $107,500, respectively.

December 28, 2015, the Company issued Ms.

Carlise, Chief Financial Officer, a ten-year option to purchase 222 shares of common

stock as compensation for services provided to the Company.

The options have an exercise price of $112.50 per share, were fully

vested on the date of grant and shall expire in December 2025.

The 222 options were valued on the grant date at approximately

$2,925.29 per option or a total of $650,000 using a Black-Scholes option pricing model with the following assumptions:

of 2,925.29 per share (based on the closing price of the Company’s common stock of the date of issuance), volatility of

992%, expected term of 10 years, and a risk-free interest rate of 1.05%.

In connection with the stock option grant, the Company

recorded stock-based compensation for the year ended December 31, 2015 of $650,000, respectively.

on December 28, 2015, the Company issued Mr.

Delgado, its Director, a ten-year option to purchase 89 shares of common stock as

compensation for services provided to the Company.

The options have an exercise price of $112.50 per share, were fully vested

on the date of grant and shall expire in December 2025.

The 89 options were valued on the grant date at approximately $2,925.73

per option or a total of $260,000 using a Black-Scholes option pricing model with the following assumptions:

stock price of $2,925.73

per share (based on the closing price of the Company’s common stock of the date of issuance), volatility of 992%, expected

term of 10 years, and a risk-free interest rate of 1.05%.

In connection with the stock option grant, the Company recorded stock-based

compensation for the year ended December 31, 2015 of $260,000, respectively.

December 16, 2016, the Company issued options to Mr.

Phipps, to purchase up to 4,444 shares of common stock.

The options were

issued outside of the Company’s 2014 Equity Incentive Plan and are not governed by the 2014 Plan.

The options have an exercise

price of $122.50 per share, vest immediately, and have a term of ten years.

The 4,444 options were valued on the grant date at

approximately $42.75 per option or a total of $190,000 using a Black-Scholes option pricing model with the following assumptions:

stock price of $42.75 per share (based on the closing price of the Company’s common stock of the date of issuance), volatility

of 872%, expected term of 10 years, and a risk-free interest rate of 1.0500%.

In connection with the stock option grant, the Company

recorded stock-based compensation for the year ended December 31, 2016 of $190,000, respectively.

May 26, 2017, the Company issued 2,222 options to Mr.

Phipps, 1,667 options to Theresa Carlise, 556 options to Hector Delgado,

its Director and 8,889 options to certain employees of the Company.

The employees are the adult children of our Chief Executive

The options were issued outside of the Company’s 2014 Equity Incentive Plan and are not governed by the 2014 Plan.

The options have an exercise price of $122.50 per share, vest immediately, and have a term of ten years.

The 13,333 options were

valued on the grant date at approximately $45.00 per option or a total of $600,000 using a Black-Scholes option pricing model

with the following assumptions:

stock price of $45.00 per share (based on the closing price of the Company’s common stock

of the date of issuance), volatility of 736%, expected term of 10 years, and a risk-free interest rate of 1.30%.

In connection

with the stock option grant, for the years ended December 31, 2017, the Company recorded stock-based compensation of $600,000.

For the year ended December 31, 2019 and 2018 the Company recorded stock-based compensation of $219,518 and $0, respectively.

the adoption of the 2020 Plan, the Board approved issuances of certain stock options to its executives, directors and employees

under the 2020 Plan.

Specifically, the stock options issued to David Phipps, CEO (400,000), Theresa Carlise, CFO (71,000)

and Hector Delgado, a Board member (21,000), all have an exercise price of $0.20 per share, respectively, fully vest upon issuance

and expire on August 20, 2030.

In addition, the Board approved additional 160,000 stock options to the Company’s 7 key employees,

on the same terms as those issued to the Company’s officers and director.

The Company uses the Black-Scholes Model to

calculate the fair value of its options.

The valuation result generated by this pricing model is necessarily driven by the value

of the underlying common stock incorporated into the model.

Management determined the expected volatility was 496.13%, a risk

free rate of interest between 0.13%, and contractual lives of the options of ten years.

In connection with the stock option

grant, for the three months ended September 30, 2020, the Company recorded a charge for the fair value of options granted of $130,400.

options outstanding at September 30, 2020, as disclosed in the below table, have approximately $276,212 of intrinsic value at

the end of the period.

summary of the status of the Company’s outstanding stock options and changes during the three months ended March 31, 2021 is as

Average Exercise

at January 1, 2021

outstanding at March 31, 2021

exercisable at March 31, 2021

summary of the status of the Company’s outstanding warrants and changes during the three months ended March 31, 2021 is as follows:

Average Exercise

at January 1, 2021

outstanding and exercisable at March 31, 2021

of March 31, 2021, and December 31, 2020, there were 4,000 warrants outstanding, respectively.

13 - RELATED PARTY TRANSACTIONS

of March 31, 2021, the accounts payable due to related party includes advances for inventory and services due to David Phipps of $91,334,

accrued director fees of $5,000 due to Hector Delgado and accrued salary and expenses due to Thomas Seifert of $10,500.

Total related

party payments due as of March 31, 2021 and December 31, 2020 are $101,834 and $102,060, respectively.

Those related party payable

are non-interest bearing and due on demand.

Company’s UK subsidiary, GTCL has an over-advance line of credit with HSBC, for working capital needs.

The over-advance limit is

£25,000 or $34,163 at an exchange rate of 1.3665, with interest at 5.50% over Bank of England’s base rate or current rate

of 6.25% variable.

The advance is guaranteed by David Phipps, the Company’s Chief Executive Officer.

The Company has an American

Express account for Orbital Satcom Corp.

and an American Express account for GTCL, both in the name of David Phipps who personally guarantees

the balance owed.

CORP AND SUBSIDIARIES

1 unchanged sentence

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

summary of the status of the Company’s outstanding stock options and changes during the nine months ended September 30,

2020 is as follows:

Balance at January 1, 2020

Balance outstanding at September 30, 2020

Options exercisable at September 30, 2020

summary of the status of the Company’s outstanding warrants and changes during the nine months ended September 30, 2020

is as follows:

Average Exercise

Balance at January 1, 2020

Balance outstanding and exercisable at September 30, 2020

of September 30, 2020, and December 31, 2019, there were 4,000 warrants outstanding, respectively.

13 - RELATED PARTY TRANSACTIONS

of September 30, 2020, the accounts payable due to related party includes advances for inventory and services due to David Phipps

of $24,062, accrued director fees of $5,000 due to Hector Delgado, Director and expenses due to Theresa Carlise of $3,120.

related party payments due as of September 30, 2020 and December 31, 2019 are $32,182 and $51,071, respectively.

Those related

party payable are non-interest bearing and due on demand.

Company employs three individuals who are related to Mr.

Phipps, of which earned gross wages totaling $58,149 and $46,116 for

the nine months ended September 30, 2020 and 2019, respectively.

Phipps, of which earned gross wages totaling $19,699 and $24,741 for the three

months ended March 31, 2021 and 2020, respectively.

14 - COMMITMENTS AND CONTINGENCIES

March 11, 2020, the World Health Organization announced that infections of the novel Coronavirus (COVID-19) had become pandemic,

and on March 13, the U.S.

President announced a National Emergency relating to the disease.

There is a possibility of continued

widespread infection in the United States and abroad, with the potential for catastrophic impact.

National, state and local authorities

have required or recommended social distancing and imposed or are considering quarantine and isolation measures on large portions

of the population, including mandatory business closures.

These measures, while intended to protect human life, are expected to

have serious adverse impacts on domestic and foreign economies of uncertain severity and duration.

Some economists are predicting

the United States will soon enter a recession.

The sweeping nature of the coronavirus pandemic makes it extremely difficult to

predict how the Company’s business and operations will be affected in the longer run, but we expect that it may materially

affect our business, financial condition and results of operations.

The extent to which the coronavirus impacts our results will

depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge

concerning the severity of the coronavirus and the actions to contain the coronavirus or treat its impact, among others.

the coronavirus outbreak has begun to have indeterminable adverse effects on general commercial activity and the world economy,

and our business and results of operations could be adversely affected to the extent that this coronavirus or any other epidemic

harms the global economy generally and/or the markets in which we operate specifically.

Any of the foregoing factors, or other

cascading effects of the coronavirus pandemic that are not currently foreseeable, could materially increase our costs, negatively

impact our revenues and damage the Company’s results of operations and its liquidity position, possibly to a significant

The duration of any such impacts cannot be predicted.

The Company may incur

significant delays and/or expenses in addition to, impairing its ability to secure additional financing, relating to the worldwide

COVID-19 (coronavirus) pandemic.

It is presently unknown whether and to what extent the Company’s supply chains may be affected

if the pandemic persists for an extended period of time.

The Company may incur significant delays or expenses relating to such

events outside of its control, which could have a material adverse impact on its business, operating results and financial condition.

The Company’s reliance on securing additional capital for its public company expenses may be impaired due to the effect

March 2020, the World Health Organization declared the outbreak of a novel coronavirus (“COVID-19”) a global pandemic prompting

government-imposed quarantines, suspension of in-person attendance of academic programs, and cessation of certain travel and business

The success of our business depends on our global operations, including our supply chain and consumer demand, among other things.

As a result of COVID-19, we have experienced shortages in inventory due to manufacturing issues, a reduction in the volume of sales in

some parts of our business, such as rental sales and direct website sales, and a reduction in personnel due to lockdown related issues.

Our results of operations for the year ended December 31, 2020 reflect this impact;

however, we expect that this trend may continue and

the full extent of the impact is unknown.

In recent months, some governmental agencies in the US and Europe, where we produce the largest

percentage of our sales, have lifted certain restrictions.

However, if customer demand continues to be low, our future equipment sales,

subscriber activations and sales margin will be impacted.

We have implemented several measures to minimize the impact on our operations

and sustain our liquidity position, including receiving support through the US payroll protection program loan (“PPP”), a

low interest, fixed rate loan provided under the UK’s Coronavirus Business Interruption Loan (“CBILS”) and the deferral

of certain UK taxes.

Company may incur significant delays and/or expenses in addition to, impairing its ability to secure additional financing, relating to

the worldwide COVID-19 (coronavirus) pandemic.

It is presently unknown whether and to what extent the Company’s supply chains may

be further affected if the pandemic persists for an extended period of time.

The Company may incur significant delays or expenses relating

to such events outside of its control, which could have a material adverse impact on its business, operating results and financial condition.

The Company’s reliance on securing additional capital for its public company expenses may be impaired due to the effect on the

financial markets.

The inability to obtain appropriate financing, may affect its compliance requirements as a public

The Company has been using its working capital from its operating subsidiaries, to support its public company expenses.

The continued drain on its working capital have forced the Company to incur cutbacks, which may affect its future operating revenue

as well as, its ability to continue operations.

June 14, 2018, the Company entered into a two (2) year Employment Agreement (the “Phipps Agreement”) with Mr.

with an automatic one (1) year extension.

Under the Phipps Agreement, Mr.

Phipps will serve as the Company’s Chief Executive

Officer and President and will receive an annual base salary equal to the sum of $170,000 and £48,000 to be paid through

our operating subsidiary, GTCL.

For the year ended December 31, 2018, the £48,000 equivalent to USD is $62,219 and the yearly

conversion rate is 1.296229.

The Phipps Agreement provides for a performance bonus based on exceeding our annual revenue goals

and on our ability to attract new investment.

The Phipps Agreement also provides for medical plan coverage, an auto allowance,

paid vacation, and discretionary stock grants and option awards.

In the event of termination without cause, termination as a result

of a change in control, or resignation with good reason (as defined in the Phipps Agreement), Mr.

Phipps will be entitled to a

severance equal to twice his base salary, the immediate vesting of all unvested options, and other benefits.

The Phipps Agreement

terminates and supersedes the Original Phipps Agreement (as defined below) and any subsequent amendments, effective as of the

June 14, 2018.

the Company had a two-year Executive Employment Agreement with Mr.

Phipps, effective January 1, 2016 (the “Original Phipps

Agreement”).

Under the Original Phipps Agreement, Mr.

Phipps agreed to serve as the Company’s Chief Executive Officer

and President and received an annual base salary equal to the sum of $144,000 and £48,000, or $61,833 at the yearly conversion

rate of 1.288190.

Phipps was also eligible for bonus compensation in an amount equal to up to fifty (50%) percent of his then-current

base salary if the Company meets or exceeds criteria adopted by the Compensation Committee, if any, or Board and equity awards

as may be approved in the discretion of the Compensation Committee or Board.

On January 1, 2018, the Original Phipps Agreement

automatically renewed for another year.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

on June 14, 2018, we entered into a new Employment Agreement (“Carlise Agreement”) with our Chief Financial Officer,

Theresa Carlise.

The Carlise Agreement is for a period of two (2) years, with an automatic one (1) year extension.

Carlise’s

base salary is $150,000 per year.

The Carlise Agreement provides for performance bonuses based on exceeding our annual revenue

goals and on our ability to attract new investment.

The Carlise Agreement also provides for medical plan coverage, an auto allowance,

paid vacation, and discretionary stock grants and option awards.

In the event of termination without cause, termination as a result

of a change in control, or resignation with good reason (as defined in the Carlise Agreement), Ms.

Carlise will be entitled to

a severance equal to twice her base salary, the immediate vesting of all unvested options, and other benefits.

The Carlise Agreement

terminates and supersedes the Original Carlise Agreement (as defined below) and any subsequent amendments, effective as of the

June 14, 2018.

to June 14, 2018, the Company had a one-year agreement with Ms.

Carlise, as its Chief Financial Officer, Treasurer and Secretary

(the “Original Carlise Agreement”).

The Original Carlise Agreement provided for an annual compensation of $140,000

as well as medical benefits.

The Original Carlise Agreement was effective December 1, 2016 and had an automatic renewal clause

pursuant to which the Original Carlise Agreement renews itself for another year, if not cancelled by the Company previously.

Original Carlise Agreement had been automatically extended for an additional term of one year on December 1, 2017.

to the base salary of $140,000 annually, Ms.

Carlise was eligible to receive an annual cash bonus if the Company meets or exceeds

criteria adopted by the Compensation Committee of the Board of Directors and shall be eligible for grants of awards under stock

option or other equity incentive plans of the Company.

March 13, 2020, the Company and David Phipps and Theresa Carlise, the Company’s Chief Executive Officer and Chief Financial

Officer, respectively, executed waivers of the provisions in their respective employment agreement requiring prior written notice

of non-renewal to the other party.

As a result, their respective employment terms with the Company will not be automatically extended

as set forth in such employment agreements and will terminate as of June 14, 2020.

August 13, 2020, the Company’s Board approved and authorized the continued employment of David Phipps and Theresa Carlise,

as the Company’s Chief Executive Officer and Chief Financial Officer, respectively, for a 30-day period, commencing as of

August 14, 2020 and terminating on September 13, 2020, which employment term may be extended as agreed by the Company and the

respective executive officers on the substantially the same compensation and other material terms during the period of the continued

employment as those set forth in their previous employment agreements.

As previously disclosed, in March 2020, the Company and

above-referenced executive officers executed waivers of the provisions in their respective employment agreement requiring prior

written notice of non-renewal to the other party.

As a result, their respective employment terms with the Company were not automatically

extended as set forth in such employment agreements and terminated as of June 13, 2020.

As previously disclosed on June 13, 2020,

the Company renewed their respective agreements for 30 days, commencing on June 14 through July 13, 2020.

Also, as previously

disclosed on July 13, 2020, the Company renewed their respective agreements for 30 days, commencing on July 14 through August

September 11, 2020, the Company’s Board approved and authorized the continued employment of David Phipps and Theresa Carlise,

as the Company’s Chief Executive Officer and Chief Financial Officer, respectively, for a 30-day period, commencing as of

September 14, 2020 and terminating on October 13, 2020, which employment term may be extended as agreed by the Company and the

respective executive officers on substantially the same compensation and other material terms during the period of the continued

employment as those set forth in their previous employment agreements.

As previously disclosed, in March 2020, the Company and

above-referenced executive officers executed waivers of the provisions in their respective employment agreement requiring prior

written notice of non-renewal to the other party.

As a result, their respective employment terms with the Company were not automatically

extended as set forth in such employment agreements and terminated as of June 13, 2020.

As previously disclosed on June 13, 2020,

the Company renewed their respective agreements for 30 days, commencing on June 14 through July 13, 2020.

As previously disclosed

on July 13, 2020, the Company renewed their respective agreements for another 30 days, commencing on July 14 through August 13,

As previously disclosed on August 14, 2020, the Company renewed their respective agreements for another 30 days, commencing

on August 14 through September 13, 2020.

The inability to obtain appropriate financing, may affect its compliance requirements as a public company.

Company has been using its working capital from its operating subsidiaries, to support its public company expenses.

The continued drain

on its working capital have forced the Company to incur cutbacks, which may affect its future operating revenue as well as, its ability

to continue operations.

March 11, 2021, the Company’s Board of Directors approved and adopted the terms and provisions of employment agreements for David

Phipps, the Company’s Chief Executive Officer, and Thomas Seifert, the Company’s Chief Financial Officer.

initial term of Mr.

Phipps’

employment is one year commencing on March 11, 2021 which term will be automatically extended for additional

one-year terms thereafter unless terminated by the Company or the executive by written notice.

CEO’s annual base compensation is

an aggregate of $180,000 payable by the Company and £50,000 (or approximately $70,000) payable through the Company’s wholly

owned subsidiary, Global Telesat Communications Ltd., subject to periodic review and modification by the Board upon occurrence of material

events relating to the Company’s financial and business performance, including, without limitation, the Company’s listing

of its capital stock on a national securities exchange.

Phipps also receives additional compensation in the form of an automobile

allowance of $1,500 per month and private family medical insurance.

In addition, Mr.

Phipps will be entitled to receive an annual cash

bonus in an amount equal to up to 150% of his base salary if the Company meets or exceeds performance criteria to be adopted by the Compensation

Committee of the Board, once established, and any other additional bonuses as may be determined by the Board.

Phipps is entitled

to receive various other benefits if and to the extent available to the employees of the Company.

The employment agreement may be terminated

based on death or disability of the executive, for cause or without good reason, for cause or with good reason, and as a result of the

change of control of the Company.

The employment agreement also contains certain provisions that are customary for agreements of this

nature, including, without limitation, non-competition and non-solicitation covenants, indemnification provisions, etc.

CORP AND SUBSIDIARIES

1 unchanged sentence

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 14, 2020, the Board of Directors (the “Board”) of Orbsat Corp (the “Company”) effected the following

changes to the Company’s executive management:

extended David Phipps’

(the Company’s Chief Executive Officer) employment with the Company for another 30-day period,

commencing on October 14, 2020, with his respective compensation and other material terms during the such term to remain substantially

the same as those set forth in the previous extensions to his employment agreement;

continued, following the October 16, 2020 expiration of Theresa Carlise’s CFO employment agreement with the Company, to

retain her services on a non-exclusive basis as the Company’s Comptroller to facilitate the CFO transition, for cash compensation

of $2,000/week.

Carlise will be so engaged at the pleasure of the Board and her engagement may be terminated upon one week’s

advance notice;

to appoint Thomas Seifert as the Company’s Chief Financial Officer for a period of 12 months commencing on October 19, 2020,

for cash compensation of $7,500/month, and such additional equity compensation as the Board may determine in the future, subject

to periodic review and adjustment by the Board in its sole discretion.

He will also be eligible to receive various other benefits

if and to the extent available to the employees of the Company.

November 12, 2020, the Company’s Board approved and authorized the continued employment of David Phipps, as the Company’s

Chief Executive Officer, for a 90-day period, commencing as of November 13, 2020, which employment term may be extended as agreed

by the Company and the executive officer on substantially the same compensation and other material terms during the period of

the continued employment as those set forth in his previous employment agreement.

As previously disclosed, in March 2020, the

Company and above-referenced executive officer executed a waiver of the provisions in his employment agreement requiring prior

written notice of non-renewal to the other party.

As a result, his employment terms with the Company were not automatically extended

as set forth in such employment agreement and terminated as of June 13, 2020.

As previously disclosed on June 13, 2020, the Company

renewed his agreement for 30 days, commencing on June 14 through July 13, 2020.

As previously disclosed on July 13, 2020, the

Company renewed his agreement for another 30 days, commencing on July 14 through August 13, 2020.

As previously disclosed on August

14, 2020, the Company renewed his agreement for another 30 days, commencing on August 14 through September 13, 2020.

As previously

disclosed on October 14, 2020, the Company renewed his agreement for another 30 days, commencing on October 14 through November

On November 12, 2020, the Company renewed his agreement for another 90 days, commencing November 13, 2020.

May 13, 2019, the Company entered into two consulting agreements (each, a “Consulting Agreement”

and together, the

“Consulting Agreements”) with unrelated third parties to provide capital raising advisory services and business growth

and development services, each for a term of nine months.

In exchange for such services, each consultant will receive (i) a Note

in the amount of $44,000 issued pursuant to the Agreement, (ii) a Note in the amount of $12,500 with a maturity of three years

bearing interest at a rate of 6% per annum with an optional right of conversion, (iii) payment of a retainer ranging from $10,000

to $30,000, and (iv) monthly payments ranging from $5,000 to $10,000 for nine months.

On August 29, 2019, one of the consulting

agreements was extended for another three months to expire on February 13, 2020 and the other was extended on September 1, 2019

for another two months and expired on January 13, 2020.

For the nine months ended September 30, 2020 and 2019, the Company recorded

professional fees of $16,290 and $0, respectively, relating to the Consulting Agreements.

July 24, 2019, a three-year lease was signed for 2,660 square feet for £25,536 annually, for our facilities in Poole, England

for £2,128 per month, or $2,706 per month at the yearly average conversion rate of 1.271713, or $2,822 using exchange rate

close at December 31, 2019 of 1.3262.

initial term of Mr.

Seifert’s employment is one year commencing on March 11, 2021 which term will be automatically extended for

additional one-year terms thereafter unless terminated by the Company or the executive by written notice.

CFO’s annual base compensation

is $150,000 payable by the Company, subject to periodic review and modification by the Board’s Compensation Committee.

will be entitled to receive an annual cash bonus in an amount equal to up to 150% of his base salary if the Company meets or exceeds

performance criteria to be adopted by the Compensation Committee of the Board, once established, and any other additional bonuses as

may be determined by the Board.

Seifert also receives additional compensation in the form of an automobile allowance of $750 per

month and $1,000 per month to purchase individual medical insurance.

Seifert is entitled to receive various other benefits if and

to the extent available to the employees of the Company.

The employment agreement may be terminated based on death or disability of the

executive, for cause or without good reason, for cause or with good reason, and as a result of the change of control of the Company.

The employment agreement also contains certain provisions that are customary for agreements of this nature, including, without limitation,

non-competition and non-solicitation covenants, indemnification provisions, etc.

July 24, 2019, a three-year lease was signed for 2,660 square feet for £25,536 annually, for our facilities in Poole, England for

£2,128 per month, or $2,717 per month at the yearly average conversion rate of 1.276933, or $2,738 using exchange rate close at

December 31, 2020 of 1.286618.

The lease has been renewed until July 23, 2022.

leases do not require any contingent rental payments, impose any financial restrictions, or contain any residual value guarantees.

Variable expenses generally represent the Company’s share of the landlord’s operating expenses.

The Company does not

have any leases classified as financing leases.

expenses generally represent the Company’s share of the landlord’s operating expenses.

The Company does not have any leases

classified as financing leases.

March 31, 2021, the Company had current and long-term operating lease liabilities of $30,385 and $14,725, respectively, and right of

use assets of $48,043.

rent expense for the three months ended March 31, 2021 and 2020 were $6,384 and $8,075, respectively.

time to time, the Company may become involved in litigation relating to claims arising out of our operations in the normal course of

The Company is not currently involved in any pending legal proceeding or litigation and, to the best of our knowledge, no governmental

authority is contemplating any proceeding to which the Company is a party or to which any of the Company’s properties is subject,

which would reasonably be likely to have a material adverse effect on the Company’s business, financial condition and operating

CORP AND SUBSIDIARIES

1 unchanged sentence

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

rate implicit in each lease is not readily determinable, and we therefore use our incremental borrowing rate to determine the

present value of the lease payments.

The weighted average incremental borrowing rate used to determine the initial value of right

of use (ROU) assets and lease liabilities during the year ended December 31, 2019 was 6.00%, derived from borrowing rate, as obtained

from the Company’s current lenders.

Right of use assets for operating leases are periodically reduced by impairment losses.

We use the long-lived assets impairment guidance in ASC Subtopic 360-10, Property, Plant, and Equipment –

Overall, to determine

whether an ROU asset is impaired, and if so, the amount of the impairment loss to recognize.

As of December 31, 2019, we have

not recognized any impairment losses for our ROU assets.

monitor for events or changes in circumstances that require a reassessment of one of our leases.

When a reassessment results in

the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset

unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero.

In that case, the amount of the

adjustment that would result in a negative ROU asset balance is recorded in profit or loss.

September 30, 2020, the Company had current and long-term operating lease liabilities of $28,489 and $28,667, respectively, and

right of use assets of $59,906.

minimum lease payments under these leases are as follows, in thousands, (unaudited):

Years Ending December 31,

Remainder of 2020

Total undiscounted future non-cancellable minimum lease payments

Imputed interest

Present value of lease liabilities

Weighted average remaining term

the Company’s financial statements for periods prior to January 1, 2019, the Company accounts for leases under ASC 840,

and provides for rent expense on a straight-line basis over the lease terms.

Net rent expense for the nine months ended September

30, 2020 and 2019 were $12,091 and $23,214, respectively.

time to time, the Company may become involved in litigation relating to claims arising out of our operations in the normal course

The Company is not currently involved in any pending legal proceeding or litigation and, to the best of our knowledge,

no governmental authority is contemplating any proceeding to which the Company is a party or to which any of the Company’s

properties is subject, which would reasonably be likely to have a material adverse effect on the Company’s business, financial

condition and operating results.

15 - CONCENTRATIONS

accounted for 60.1% and 57.6% of the Company’s revenues during the nine months ended September 30, 2020 and 2019, respectively.

For the three months ended September 30, 2020 and 2019, Amazon accounted for 64.9% and 63.6% of the Company’s revenues.

No other customer accounted for 10% or more of the Company’s revenues for either period.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

following table sets forth information as to each supplier that accounted for 10% or more of the Company’s purchases for

the nine months ended September 30, 2020 and 2019.

September 30, 2020

September 30, 2019

Network Innovations

Cygnus Telecom

following table sets forth information as to each supplier that accounted for 10% or more of the Company’s purchases for

the three months ended September 30, 2020 and 2019.

September 30, 2020

September 30, 2019

Network Innovations

Cygnus Telecom

Satcom Global

following table sets forth revenue as to each geographic location, for the nine months ended September 30, 2020 and 2019:

September 30, 2020

September 30, 2019

North America

South America

Asia & Pacific

Australia & Oceanic

following table sets forth revenue as to each geographic location, for the three months ended September 30, 2020 and 2019:

September 30, 2020

September 30, 2019

North America

South America

Asia & Pacific

Australia & Oceanic

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

accounted for 53.6% and 56.6% of the Company’s revenues during the three months ended March 31, 2021 and 2020, respectively.

other customer accounted for 10% or more of the Company’s revenues for either period.

following table sets forth information as to each supplier that accounted for 10% or more of the Company’s purchases for the three

months ended March 31, 2021 and 2020.

following table sets forth revenue as to each geographic location, for the three months ended March 31, 2021 and 2020:

16 - SUBSEQUENT EVENTS

October 14, 2020, the Board of Directors (the “Board”) of Orbsat Corp (the “Company”) effected the following

changes to the Company’s executive management:

extended David Phipps’

(the Company’s Chief Executive Officer) employment with the Company for another 30-day period,

commencing on October 14, 2020, with his respective compensation and other material terms during the such term to remain substantially

the same as those set forth in the previous extensions to his employment agreement;

continued, following the October 16, 2020 expiration of Theresa Carlise’s CFO employment agreement with the Company, to

retain her services on a non-exclusive basis as the Company’s Comptroller to facilitate the CFO transition, for cash compensation

of $2,000/week.

Carlise will be so engaged at the pleasure of the Board and her engagement may be terminated upon one week’s

advance notice;

to appoint Thomas Seifert as the Company’s Chief Financial Officer for a period of 12 months commencing on October 19, 2020,

for cash compensation of $7,500/month, and such additional equity compensation as the Board may determine in the future, subject

to periodic review and adjustment by the Board in its sole discretion.

He will also be eligible to receive various other benefits

if and to the extent available to the employees of the Company.

November 3, 2020, the Company issued an aggregate of 30,305 common stock upon the conversion of $6,061 of its convertible debt,

at the conversion rate of $0.20 per share.

November 5, 2020, the Company issued an aggregate of 129,241 common stock upon the conversion of $25,848 of its convertible debt,

at the conversion rate of $0.20 per share.

November 6, 2020, the Company issued an aggregate of 56,700 common stock upon the conversion of $11,340 of its convertible debt,

at the conversion rate of $0.20 per share.

November 11, 2020, the Company issued an aggregate of 100,000 common stock upon the conversion of $20,000 of its convertible debt,

at the conversion rate of $0.20 per share.

November 12, 2020, the Company’s Board approved and authorized the continued employment of David Phipps, as the Company’s

Chief Executive Officer, for a 90-day period, commencing as of November 13, 2020, which employment term may be extended as agreed

by the Company and the executive officer on substantially the same compensation and other material terms during the period of

the continued employment as those set forth in his previous employment agreement.

As previously disclosed, in March 2020, the

Company and above-referenced executive officer executed a waiver of the provisions in his employment agreement requiring prior

written notice of non-renewal to the other party.

As a result, his employment terms with the Company were not automatically extended

as set forth in such employment agreement and terminated as of June 13, 2020.

As previously disclosed on June 13, 2020, the Company

renewed his agreement for 30 days, commencing on June 14 through July 13, 2020.

As previously disclosed on July 13, 2020, the

Company renewed his agreement for another 30 days, commencing on July 14 through August 13, 2020.

As previously disclosed on August

14, 2020, the Company renewed his agreement for another 30 days, commencing on August 14 through September 13, 2020.

As previously

disclosed on October 14, 2020, the Company renewed his agreement for another 30 days, commencing on October 14 through November

On November 12, 2020, the Company renewed his agreement for another 90 days, commencing November 13, 2020.

On November 13, 2020,

the Company issued an aggregate of 194,472 common stock upon the conversion of $38,894 of its convertible debt, at the conversion

rate of $0.20 per share.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

following information should be read in conjunction with the condensed consolidated financial statements and the notes thereto

contained elsewhere in this report.

Statements made in this Item 2, “Management’s Discussion and Analysis and Plan

of Financial Condition and Results of Operations,”

and elsewhere in this quarterly report on Form 10-Q that do not consist

of historical facts, are “forward-looking statements.”

Statements accompanied or qualified by, or containing words

such as “may,”

following information should be read in conjunction with the condensed consolidated financial statements and the notes thereto contained

elsewhere in this report.

Statements made in this Item 2, “Management’s Discussion and Analysis and Plan of Financial Condition

and Results of Operations,”

and elsewhere in this quarterly report on Form 10-Q that do not consist of historical facts, are “forward-looking

statements.”

Statements accompanied or qualified by, or containing words such as “may,”

“will,”

13 unchanged sentences

and “assume”

constitute forward-looking

statements, and as such, are not a guarantee of future performance.

The statements involve factors, risks and uncertainties, the

impact or occurrence of which can cause actual results to differ materially from the expected results described in such statements.

Risks and uncertainties can include, among others, fluctuations in general business cycles and changing economic conditions;

product demand and industry capacity;

constitute forward-looking statements, and as such, are not a guarantee of future performance.

The statements

involve factors, risks and uncertainties, the impact or occurrence of which can cause actual results to differ materially from the expected

results described in such statements.

Risks and uncertainties can include, among others, fluctuations in general business cycles and

changing economic conditions;

changing product demand and industry capacity;

increased competition and pricing pressures;

advances in technology that can reduce the

demand for the Company’s products, as well as other factors, many or all of which may be beyond the Company’s control.

Consequently, investors should not place undue reliance upon forward-looking statements as predictive of future results.

disclaims any obligation to update the forward-looking statements in this report.

should read the following information in conjunction with our financial statements and related notes contained elsewhere in this

You should consider the risks and difficulties frequently encountered by early-stage companies, particularly those engaged

in new and rapidly evolving markets and technologies.

Our limited operating history provides only a limited historical basis to

assess the impact that critical accounting policies may have on our business and our financial performance.

encourage you to review our periodic reports filed with the SEC and included in the SEC’s EDGAR database, including the

Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on March 30, 2020, and the Company’s

subsequent public filings with the SEC.

technology that can reduce the demand for the Company’s products, as well as other factors, many or all of which may be beyond

the Company’s control.

Consequently, investors should not place undue reliance upon forward-looking statements as predictive of

future results.

The Company disclaims any obligation to update the forward-looking statements in this report.

should read the following information in conjunction with our financial statements and related notes contained elsewhere in this report.

You should consider the risks and difficulties frequently encountered by early-stage companies, particularly those engaged in new and

rapidly evolving markets and technologies.

Our limited operating history provides only a limited historical basis to assess the impact

that critical accounting policies may have on our business and our financial performance.

encourage you to review our periodic reports filed with the SEC and included in the SEC’s EDGAR database, including the Annual

Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 22, 2021, and the Company’s subsequent

public filings with the SEC.

are a provider of satellite-based hardware, airtime and related services both in the United States and internationally.

equipment and airtime for use on all of the major satellite networks including Globalstar, Inmarsat, Iridium and Thuraya and operate

a short-term rental service for customers who desire to use our equipment for a limited time period.

Our acquisition of GTCL in

February 2015 expanded our global satellite-based infrastructure and business, which was first launched in December 2014 through

the purchase of certain contracts.

of June 30, 2020, there were 50,000,000 shares of common stock authorized and 255,329 shares issued and outstanding.

January 30, 2020, the Company issued an aggregate of 18,147 common stock upon the conversion of $1,815 of its convertible debt,

at the conversion rate of $0.10 per share.

January 31, 2020, the Company issued an aggregate of 18,147 common stock upon the conversion of $1,815 of its convertible debt,

at the conversion rate of $0.10 per share.

February 10, 2020, the Company issued an aggregate of 25,421 common stock upon the conversion of $2,542 of its convertible debt,

at the conversion rate of $0.10 per share.

February 11, 2020, the Company issued an aggregate of 23,580 common stock upon the conversion of $2,358 of its convertible debt,

at the conversion rate of $0.10 per share.

February 18, 2020, the Company issued an aggregate of 13,192 common stock upon the conversion of $1,319 of its convertible debt,

at the conversion rate of $0.10 per share.

February 19, 2020, the Company issued an aggregate of 4,468 common stock upon the conversion of $446 of its convertible debt,

at the conversion rate of $0.10 per share.

March 9, 2020, the Company issued an aggregate of 10,305 common stock upon the conversion of $1,031 of its convertible debt, at

We sell equipment

and airtime for use on all of the major satellite networks including Globalstar, Inmarsat, Iridium and Thuraya and operate a short-term

rental service for customers who desire to use our equipment for a limited time period.

Our acquisition of GTCL in February 2015 expanded

our global satellite-based infrastructure and business, which was first launched in December 2014 through the purchase of certain contracts.

March 2020, the World Health Organization declared the outbreak of a novel coronavirus (“COVID-19”) a global pandemic prompting

government-imposed quarantines, suspension of in-person attendance of academic programs, and cessation of certain travel and business

The United States has entered a recession as a result of the COVID-19 pandemic, which may prolong and exacerbate the negative

impact on us.

Although we expect the availability of vaccines and various treatments with respect to COVID-19 to have an overall positive

impact on business conditions in the aggregate over time, the exact timing of these positive developments is uncertain.

In December 2020,

the United States began distributing two vaccines that, in addition to other vaccines under development, are expected to help to reduce

the spread of the coronavirus that causes COVID-19 once they are widely distributed.

If the vaccines prove less effective than currently

understood by the scientific community and the United States Food and Drug Administration, or if there are problems with the acceptance,

availability, timing or other difficulties with widely distributing the vaccines, the pandemic may last longer, and could continue to

impact our business for longer, than we currently expect.

In response to COVID-19, governmental authorities have implemented numerous

measures to try to contain the virus, such as travel bans and restrictions, prohibitions on group events and gatherings, shutdowns of

certain businesses, curfews, shelter in place orders and recommendations to practice social distancing.

Although many governmental measures

have had specific expiration dates, some of those measures have already been extended more than once, and there is considerable uncertainty

regarding the duration of such measures and the implementation of any potential future measures, especially if cases increase across

the United States, with the potential for additional challenges resulting from the emergence of new variants of COVID-19, some of which

may be more transmissible than the initial strain.

Such measures have impacted, and may continue to affect, our workforce, operations,

suppliers and customers.

We reduced the size of our workforce following the onset of COVID-19 and may need to take additional actions

to further reduce the size of our workforce in the future;

such reductions incur costs, and we can provide no assurance that we will

be able to rehire our workforce in the event our business experiences a subsequent recovery.

We took steps to curtail our operating expenses

and conserve cash.

We may elect or need to take additional remedial measures in the future as the information available to us continues

to develop, including with respect to our workforce, relationships with our third-party vendors, and our customers.

There is no certainty

that the remedial measures we have implemented to date, or any additional remedial steps we may take in the future, will be sufficient

to mitigate the risks posed by COVID-19.

Further, such measures could potentially materially adversely affect our business, financial

condition and results of operations and create additional risks for us.

Any escalation of COVID-19 cases across many of the markets we

serve could have a negative impact on us.

Specifically, we could be adversely impacted by limitations on our employees to perform their

work due to illness caused by the pandemic or local, state, or federal orders requiring our stores to close or employees to remain at

limitation of carriers to deliver our product to customers;

product shortages;

limitations on the ability of our customers to conduct

their business and purchase our products and services;

and limitations on the ability of our customers to pay us in a timely manner.

These events could have a material, adverse effect on our results of operations, cash flows and liquidity.

ultimate magnitude of COVID-19, including the full extent of the material negative impact on our financial and operational results, will

depend on future developments, such as the duration and severity of the pandemic, the extent of any additional increases in cases across

the United States, and the related length of its impact on the global economy, as well as the timing and availability of effective medical

treatments and vaccines, which remain uncertain and cannot be predicted at this time.

The resumption of our normal business operations

may be delayed or constrained by lingering effects of COVID-19 on our customers, suppliers and/or third-party service providers.

the extent to which our mitigation efforts are successful, if at all, is not currently ascertainable.

Due to the daily evolution of the

COVID-19 pandemic and the responses to curb its spread, we cannot predict the full impact of the COVID-19 pandemic on our business and

results of operations, but our business, financial condition, results of operations and cash flows have already been materially adversely

impacted, and we anticipate they will continue to be adversely affected by the COVID-19 pandemic and its negative effects on global economic

Any recovery from the COVID-19 pandemic and related economic impact may also be slowed or reversed by a variety of factors,

such as any increase in COVID-19 infections.

Even after the COVID-19 pandemic has subsided, we may continue to experience adverse impacts

to our business as a result of its national and, to some extent, global economic impact, including the current recession and any recession

that may occur in the future.

success of our business depends on our global operations, including our supply chain and consumer demand, among other things.

of COVID-19, we have experienced shortages in inventory due to manufacturing issues, a reduction in the volume of sales in some parts

of our business, such as rental sales and direct website sales, and a reduction in personnel due to lockdown related issues.

of operations for the year ended December 31, 2020 reflect this impact;

however, we expect that this trend may continue and the full

extent of the impact is unknown.

In recent months, some governmental agencies in the US and Europe, where we produce the largest percentage

of our sales, have lifted certain restrictions.

However, if customer demand continues to be low, our future equipment sales, subscriber

activations and sales margin will be impacted.

We have implemented several measures to minimize the impact on our operations and sustain

our liquidity position, including receiving support through the US payroll protection program loan (“PPP”), a low interest,

fixed rate loan provided under the UK’s Coronavirus Business Interruption Loan (“CBILS”) and the deferral of certain

Recent Events

of March 31, 2021, there were 50,000,000 shares of common stock authorized and 6,177,203 shares issued and outstanding.

February 19, 2021, the Board of Directors of the Company unanimously adopted an amendment to the Company’s Articles of Incorporation

to effect a reverse stock split at a ratio of (i) no less than 1-for-2 shares of Common Stock, and (ii) no more than 1-for-5 shares of

Common Stock, the exact ratio to be determined in the sole discretion of the Board of Directors, at any time before August 31, 2021.

The Board of Directors has obtained (by written consent) the approval of the Company’s stockholders who, in the aggregate, own

2,686,337 shares of Common Stock, or 63.5% of the outstanding shares of Common Stock of the Company prior to the Reverse Split Action.

January 12, 2021, the Company issued an aggregate of 150,000 common stock upon the conversion of $30,000 of its convertible debt, at

the conversion rate of $0.20 per share.

April 17, 2020, the Company issued an aggregate of 7,046 common stock upon the conversion of $705 of its convertible debt, at

February 23, 2021, the Company issued an aggregate of 401,446 common stock upon the conversion of $50,289 of its convertible debt, at

the conversion rate of $0.20 per share.

April 22, 2020, the Company issued an aggregate of 370 common stock upon the conversion of $37 of its convertible debt, at the

conversion rate of $0.10 per share.

June 22, 2020, the Company issued an aggregate of 13,437 common stock upon the conversion of $2,687 of its convertible debt, at

February 23, 2021, the Company issued an aggregate of 600,000 common stock upon the conversion of $150,000 of its convertible debt, at

the conversion rate of $0.25 per share.

of June 30, 2020, there were no shares of Series A, B, C, D, E, F, G, H, I, J, K and L Convertible Preferred Stock authorized,

and no shares issued and outstanding.

July 8, 2020, the Company issued an aggregate of 1,095 common stock upon the conversion of $219 of its convertible debt, at the

February 23, 2021, the Company issued an aggregate of 5,000 common stock for services in the amount of $14,200.

March 1, 2021, the Company issued an aggregate of 860,740 common stock upon the conversion of $172,148 of its convertible debt, at the

conversion rate of $0.20 per share.

July 16, 2020, the Company’s Board of Directors approved and the Company entered into a 12-month consulting agreement (“Consulting

Agreement”) with an unrelated third-party for capital raising advisory services and business growth and development services,

with the term renewable upon mutual consent of the parties.

Upon signing of the Consulting Agreement, the Company agreed to issue

20,000 restricted shares of its common stock to the consultant (the “Consulting Shares”), 5,000 additional restricted

shares of common stock to be issued quarterly until the consultant may receive cash compensation for its services, which will

be determined, upon completion of certain milestones, by the Company’s CEO.

July 23, 2020, the Company issued an aggregate of 2,342 common stock upon the conversion of $468 of its convertible debt, at the

March 1, 2021, the Company issued an aggregate of 80,000 common stock upon the conversion of $20,000 of its convertible debt, at the

conversion rate of $0.25 per share.

August 26, 2020, the Company issued an aggregate of 586,000 common stock upon the conversion of $117,200 of its convertible debt,

at the conversion rate of $0.20 per share.

September 1, 2020, the Company issued an aggregate of 148,424 common stock upon the conversion of $29,685 of its convertible debt,

at the conversion rate of $0.20 per share.

September 2, 2020, the Company issued an aggregate of 21,753 common stock upon the conversion of $4,351 of its convertible debt,

at the conversion rate of $0.20 per share.

September 8, 2020, the Company issued an aggregate of 167,998 common stock upon the conversion of $33,600 of its convertible debt,

at the conversion rate of $0.20 per share.

September 10, 2020, the Company issued an aggregate of 572,285 common stock upon the conversion of $114,457 of its convertible

debt, at the conversion rate of $0.20 per share.

September 11, 2020, the Company issued an aggregate of 75,000 common stock upon the conversion of $15,000 of its convertible debt,

at the conversion rate of $0.20 per share.

September 14, 2020, the Company issued an aggregate of 331,472 common stock upon the conversion of $66,294 of its convertible

debt, at the conversion rate of $0.20 per share.

September 15, 2020, the Company issued an aggregate of 67,647 common stock upon the conversion of $13,529 of its convertible debt,

at the conversion rate of $0.20 per share.

September 16, 2020, the Company issued an aggregate of 151,373 common stock upon the conversion of $30,275 of its convertible

debt, at the conversion rate of $0.20 per share.

September 17, 2020, the Company issued an aggregate of 165,985 common stock upon the conversion of $33,197 of its convertible

debt, at the conversion rate of $0.20 per share.

September 21, 2020, the Company issued an aggregate of 28,901 common stock upon the conversion of $5,780 of its convertible debt,

at the conversion rate of $0.20 per share.

September 22, 2020, the Company issued an aggregate of 275,026 common stock upon the conversion of $55,005 of its convertible

debt, at the conversion rate of $0.20 per share.

September 30, 2020, the Company issued an aggregate of 216,199 common stock upon the conversion of $43,240 of its convertible

debt, at the conversion rate of $0.20 per share.

had net cash used by operations of $471,793 during the nine months ended September 30, 2020.

At September 30, 2020, we had a working

capital of $98,191.

Additionally, at September 30, 2020, we had an accumulated deficit of $12,450,262 and stockholder’s

had net cash used by operations of $459,764 during the three months ended March 31, 2021.

At March 31, 2021, we had negative working

capital of approximately $33,271.

Additionally, at March 31, 2021, we had an accumulated deficit of $14,681,695 and stockholder’s

equity of $576,368.

These matters and our expected needs for capital investments required to support operational growth raise

substantial doubt about our ability to continue as a going concern.

Our condensed consolidated financial statements do not include

any adjustments to reflect the possible effects on recoverability and classification of assets or the amounts and classification

of liabilities that may result from our inability to continue as a going concern.

Company may incur significant delays and/or expenses in addition to, impairing its ability to secure additional financing, relating

to the worldwide COVID-19 (coronavirus) pandemic.

Beginning in late 2019, there have been reports of the COVID-19 (coronavirus)

outbreak originating in China, prompting government-imposed quarantines, closures of certain travel and businesses, which outbreak

evolved into a worldwide pandemic in March 2020.

It is presently unknown whether and to what extent the Company’s supply

chains may be affected if the pandemic persists for an extended period of time.

The Company may incur significant delays or expenses

relating to such events outside of its control, which could have a material adverse impact on its business, operating results

and financial condition.

The Company’s reliance on securing additional capital for its public company expenses may be impaired

due to the effect on the U.S.

financial markets.

The inability to obtain appropriate financing, may affect its compliance requirements

as a public company.

The Company has been using its working capital from its operating subsidiaries, to support its public company

The continued drain on its working capital have forced the Company to incur cutbacks, which may affect its future operating

revenue as well as, its ability to continue operations.

April 1, 2020, the Company’s UK based subsidiary, GTCL furloughed 6 employees.

Under the “Corona Virus Job Retention

Scheme”, the furloughed employees will be paid through the Company, reimbursable in an amount equal to 80% of the employees’

wages thru the UK government until June 30, 2020.

The Company has recorded the reimbursement of the 80% of wages, in the amount

of $32,333, in salaries, in its statement of operations for the nine months ended September 30, 2020.

On May 4, 2020, the Bournemouth,

Christchurch and Poole Council, has awarded a grant of £25,000 to GTCL, under its COVID-19 relief scheme, “Retail,

Leisure and Hospitality Relief”.

The grant is not a loan and is not to be repaid and is reflected as other income on the

Company’s statement of operations.

Additionally, on May 5, 2020, the Bournemouth, Christchurch and Poole Council, waived

the 2020 business rates for the period starting April 1, 2020 thru March 31, 2021, of approximately £13,224 or $17,101,

at the quarterly average exchange rate at September 30, 2020 of 1.293173.

May 8, 2020, Orbsat Corp was approved for the Payroll Protection Program (“PPP”) loan.

The loan is for $20,832 and

has a term of 2 years, of which the first 6 months are deferred at an interest rate of 1%.

As of September 30, 2020, the Company

has recorded $13,020 as current portion of notes payable and $7,812 as notes payable long term.

April 20, 2020, the Board approved for its wholly owned UK subsidiary, Global Telesat Communications LTD (“GTC”),

to apply for a Coronavirus Interruption Loan, offered by the UK government, for an amount up to £250,000.

On July 16, 2020

(the “Issue Date”), GTC, entered into a Coronavirus Interruption Loan Agreement (“Debenture”) by and among

the Company and HSBC UK Bank PLC (the “Lender”) for an amount of £250,000, or USD$313,875 at an exchange rate

of GBP:USD of 1.2555.

The Debenture bears interest at a rate of 3.99% per annum over the Bank of England Base Rate (0.1% as of

July 16, 2020), payable monthly on the outstanding principal amount of the Debenture.

The Debenture has a term of 6 years from

the date of drawdown, July 15, 2026, the “Maturity Date”.

The first repayment of £4,166.67 (exclusive of interest)

will be made 13 month(s) after July 16, 2020.

Voluntary prepayments are allowed with 5 business days’

written notice and

the amount of the prepayment is equal to 10% or more of the Limit or, if less, the balance of the debenture.

The Debenture is

secured by all GTC’s assets as well as a guarantee by the UK government, with the proceeds of the Debenture are to be used

for general corporate and working capital purposes.

The Debenture includes customary events of default, including, among others:

(i) non-payment of amounts due thereunder, (ii) non-compliance with covenants thereunder, (iii) bankruptcy or insolvency (each,

an “Event of Default”).

Upon the occurrence of an Event of Default, the Debenture becomes payable upon demand.

Company anticipates that the continued demands for working capital needed to support its operation and therefore anticipates engaging

in various capital raising efforts and cost-cutting measures, including, without limitation, temporary or permanent cutbacks to

its personnel, curtailing portion(s) of its operations, etc., which measures are likely to adversely affect the Company’s

future operations, revenue as well as its ability to continue its current operations.

Even if we raise sufficient capital through

equity or debt financing, strategic alliances or otherwise, there can be no assurances that the revenue or capital infusion will

be sufficient to enable us to sustain our business to a level where it will be profitable or generate positive cash flow.

Management’s

plan to alleviate the substantial doubt about the Company’s ability to continue as a going concern include attempting to

improve its business profitability, its ability to generate sufficient cash flow from its operations to meet its operating needs

on a timely basis, obtain additional working capital funds through debt and equity financings to eliminate inefficiencies in order

to meet its anticipated cash requirements.

However, there can be no assurance that these plans and arrangements will be sufficient

to fund the Company’s ongoing capital expenditures, working capital, and other requirements.

If we are unable to achieve

these goals, our business would be jeopardized and the Company may not be able to continue.

June 15, 2020, the Company’s Board approved and authorized continued employment of David Phipps and Theresa Carlise, as

the Company’s Chief Executive Officer and Chief Financial Officer, respectively, for a 30-day period, commencing as of June

14, 2020, which employment term may be extended as agreed by the Company and the respective executive officers on the substantially

the same compensation and other material terms during the period of the continued employment as those set forth in their previous

employment agreements.

As previously disclosed, in March 2020, the Company and above-referenced executive officers executed waivers

of the provisions in their respective employment agreement requiring prior written notice of non-renewal to the other party.

a result, their respective employment terms with the Company were not automatically extended as set forth in such employment agreements

and terminates as of June 14, 2020.

On July 13, 2020, the Board extended their respective employments for another 30-day period.

On August 13, 2020 and on September 11, 2020, the Board resolved to negotiate and, when prepared, enter into executive employment

agreements David Phipps as the Company’s CEO and Theresa Carlise, the Company’s CFO, on substantially the same compensation

and other material terms as those set forth in their previous employment agreements.

October 14, 2020, the Board effected the following changes to the Company’s executive management:

extended David Phipps’

(the Company’s Chief Executive Officer) employment with the Company for another 30-day period,

commencing on October 14, 2020, with his respective compensation and other material terms during the such term to remain substantially

the same as those set forth in the previous extensions to his employment agreement;

continued, following the October 16, 2020 expiration of Theresa Carlise’s CFO employment agreement with the Company, to

retain her services on a non-exclusive basis as the Company’s Comptroller to facilitate the CFO transition, for cash compensation

of $2,000/week.

Carlise will be so engaged at the pleasure of the Board and her engagement may be terminated upon one week’s

advance notice;

to appoint Thomas Seifert as the Company’s Chief Financial Officer for a period of 12 months commencing on October 19, 2020,

for cash compensation of $7,500/month, and such additional equity compensation as the Board may determine in the future, subject

to periodic review and adjustment by the Board in its sole discretion.

He will also be eligible to receive various other benefits

if and to the extent available to the employees of the Company.

of Operations for the Three and Nine Months Ended September 30, 2020 compared to the Three and Nine Months Ended September 30,

Sales for the three and nine months ended September 30, 2020 consisted primarily of sales of satellite phones, tracking devices,

locator beacons, accessories and airtime plans.

For the three months ended September 30, 2020, revenues generated were $1,475,393

compared to $1,746,525 of revenues for the three months ended September 30, 2019, a decrease in total revenues of $271,132 or

Total sales for Global Telesat Communications Ltd.

were $1,002,872 for the three months ended September 30, 2020, as compared

to $1,103,619 for the three months ended September 30, 2019, a decrease of $100,747 or 9.1%.

Total sales for Orbital Satcom Corp.

were $472,521 for the three months ended September 30, 2020 as compared to $642,906, for the three months ended September 30,

2019, a decrease of $170,385 or 26.5%.

the nine months ended September 30, 2020, revenues generated were $4,163,750 compared to $4,453,906 of revenues for the nine months

ended September 30, 2020 and 2019, a decrease in total revenues of $290,156 or 6.5%.

These matters and our expected needs for capital investments required to support operational growth raise substantial

doubt about our ability to continue as a going concern.

Our consolidated financial statements do not include any adjustments to reflect

the possible effects on recoverability and classification of assets or the amounts and classification of liabilities that may result

from our inability to continue as a going concern.

of Operations for the Three Months Ended March 31, 2021 compared to the Three Months Ended March 31, 2020

Net Sales for the three months ended March 31, 2021, consisted primarily of sales of satellite phones, tracking devices, accessories

and airtime plans.

For the three months ended March 31, 2021, revenues generated were $1,461,428 compared to $1,468,103 of revenues for

the three months ended March 31, 2020, a decrease in total revenues of $6,675 or 0.5%.

Total sales for Global Telesat Communications

were $2,677,039 for the nine months ended September 30, 2020, as compared to $3,128,211 for the nine months ended September

30, 2019, a decrease of $451,172 or 14.4%.

The Company attributes this decrease to reduced recreational consumer demand

as a result of lockdown measures imposed across Europe during much of the quarter.

Total sales for Orbital Satcom Corp.

were $1,486,711

for the nine months ended September 30, 2020 as compared to $1,325,695, for the nine months ended September 30, 2019, an increase

of $161,016 or 12.5%.

The Company attributes the increases in revenue to new product lines and significant increases in US e-commerce

sales, offset by the decrease in exchange rates from GBP:

During the three months ended September 30, 2020, cost of revenues decreased to $1,076,929 compared to

$1,366,008, for the three months ended September 30, 2019, a decrease of $289,079 or 21.2%.

Gross profit margins during the three

months ended September 30, 2020 were 27.0% as compared to 21.8% for the comparable period in the prior year.

During the nine months

ended September 30, 2020, cost of revenues decreased to $3,159,593 compared to $3,553,351, for the nine months ended September

30, 2019, a decrease of $393,758 or 11.1%.

Gross profit margins during the nine months ended September 30, 2020 were 24.1% as

compared to 20.2% for the comparable period in the prior year.

As indicated by the results for the three and nine months ending

September 30, 2020, our profit margins have increased by 5.2% and 3.9%.

However, we cannot be certain that we can

maintain the increased margin levels.

We expect our cost of revenues as compared with sales growth to continue to increase during

fiscal 2020 and beyond, as we expand our operations and begin generating additional revenues under our current business.

to the extent costs will so increase, we are unable at this time to estimate the amount of the expected increases.

Total operating expenses for the three months ended September 30, 2020, were $872,835, an increase of

$289,799 or 49.7%, from total operating expenses for the three months ended September 30, 2019, of $583,036 .

Total operating

expenses for the nine months ended September 30, 2020, were $1,859,012, an increase of $149,014 or 8.7%, from total operating

expenses for the nine months ended September 30, 2019, of $1,709,998 .

Factors contributing to the decrease are described

general and administrative expenses were $182,813 and $210,600 for the three months ended September 30, 2020 and 2019,

respectively, a decrease of $27,787 or 13.2%.

Selling, general and administrative expenses were $486,984 and $522,352 for the

nine months ended September 30, 2020 and 2019, respectively, a decrease of $35,368 or 6.8%.

The increase for the nine months ended

September 30, 2020, are attributable to certain SG&A expenses that fluctuate with sales volatility, offset by an increase

in Amazon fees as a percentage of sales and a decrease in administrative expenses.

wages and payroll taxes were $196,629 and $176,762, for the three months ended September 30, 2020 and 2019, respectively,

an increase of $19,867, or 11.2%.

Salaries, wages and payroll taxes were $542,675 and $536,504, for the nine months ended September

30, 2020 and 2019, respectively, an increase of $6,171 or 1.1%.

The decrease is a result of the Company’s UK subsidiary,

GTCL, reduction in staff, furloughed as part of the UK Coronavirus Job Retention Scheme.

The Company furloughs employees and pays

their full compensation and receives 80% of the paid wages through a grant as provided by the UK government, for the nine months

ended September 30, 2020.

fees were $289,296 and $126,565 for the three months ended September 30, 2020 and 2019, respectively, an increase of $162,731,

Professional fees were $480,961 and $447,908 for the nine months ended September 30, 2020 and 2019, respectively, an

were $1,013,435 for the three months ended March 31, 2021, as compared to $953,820 for the three months ended March 31, 2020, an

increase of $59,615 or 6.3%.

The increase during the three and nine months ended September 30, 2020 as compared to the same period

in 2019, is attributable to professional fees, see Note 14, Commitments and Contingencies, of which agreements expired on February

and amortization expenses were $73,697 and $69,109 for the three months ended September 30, 2020 and 2019, respectively,

Total sales for Orbital Satcom Corp.

were $447,993 for the three months ended March 31, 2021 as compared

to $514,283, for the three months ended March 31, 2020, a decrease of $66,290 or 12.9%.

The Company attributes the changes in revenue

to new product lines and significant increases in US Amazon sales, offset by the change in exchange rates from GBP:USD.

During the three months ended March 31, 2021, cost of sales decreased to $1,023,911 compared to $1,120,102,

for the three months ended March 31, 2020, a decrease of $96,191 or 8.6%.

Gross profit margins during the three months ended March 31,

2021 were 29.9% as compared to 23.7% for the comparable period in the prior year.

As indicated by the results for the quarter, our sales

margins have increased by 6.2%.

However, we cannot be certain that we can maintain the increased margin levels.

The increase is primarily

due to a greater percentage of high margin sales in the first quarter ended March 31, 2021 as compared to the same period in 2020,

as well to as an increase in margins on certain sales that resulted from customers bearing value added tax (VAT) that was previously

borne by the Company.

Total operating expenses for the three months ended March 31, 2021 were $736,446, an increase of $197,205 or

36.6%, from total operating expenses for the three months ended March 31, 2020 of $539,241 .

Factors contributing to the decrease

are described below.

general and administrative expenses were $161,690 and $157,206 for the three months ended March 31, 2021 and 2020, respectively,

an increase of $4,484 or 2.9%.

Depreciation and amortization expenses were $217,992 and $203,234 for the nine months ended September

The increase, for the three months ended March 31, 2021, is attributable to certain SG&A expenses

that fluctuate with sales volatility.

wages and payroll taxes were $208,174 and $195,642 for the three months ended March 31, 2021 and 2020, respectively, an increase

of $12,532, or 6.4%.

The increase is a result of an increase in staff and part time employees, for the three months ended March 31, 2021.

fees were $292,882 and $114,889 for the three months ended March 31, 2021 and 2020, respectively, an increase of $177,993, or

The increase during the three months ended March 31, 2021 as compared to the same period in 2020, is attributable to professional

fees related to the potential listing of the Company’s common stock on the Nasdaq Capital Market.

and amortization expenses were $73,700 and $71,504 for the three months ended March 31, 2021 and 2020, respectively, an increase

of $2,196 or 3.1%.

The increase was primarily attributable to the addition of fixed assets offset by fully amortized assets, as compared

to the same period in the prior year.

expect our expenses in each of these areas to continue to increase during fiscal 2021 and beyond as we expand our operations and begin

generating additional revenues under our current business.

Similarly, we are unable at this time to estimate the amount of the expected

Other Expense .

Our total other expenses were $504,213 compared to $93,620 during the three months ended March 31, 2021

and 2020, respectively, an increase of $410,593 or 438.6%.

The increase was primarily attributable to the addition of fixed

assets, from the year ended December 31, 2019 of $70,194, and $30,758 for the nine months ended September 30, 2020, offset by

fully amortized assets, as compared to the same period in the prior year.

expect our expenses in each of these areas to continue to increase during fiscal 2020 and beyond as we expand our operations and

begin generating additional revenues under our current business.

Similarly, we are unable at this time to estimate the amount

of the expected increases.

Other (Income) Expense .

Our total other (income) expense was $626,080 compared to $98,440 during the three months

ended September 30, 2020 and 2019, respectively, an increase in other expense of $527,640 or 536%.

Our total other (income) expense

was $503,890 compared to $186,006 during the nine months ended September 30, 2020 and 2019, respectively, an increase of other

expense of $317,884 or 170.9%.

The increase is attributable to extinguishment of debt of $269,261, other income of $31,793, interest

expense $797,807 offset by interest earned of $80 and foreign currency exchange variance of $7,217.

We recorded a net loss before income tax of $1,100,451 for the three months ended September 30, 2020 as compared

to a net loss of $300,959, for the three months ended September 30, 2019.

For the nine months ended September 30, 2020, we recorded

a net loss before income tax of $1,358,745 as compared to a net loss of $995,449 for the nine months ended September 30, 2019.

The increase is attributable to an increase in interest expense related to

non-cash charges associated with the Company’s convertible notes payable offset by foreign currency exchange variance.

We recorded net loss before income tax of $803,142 for the three months ended March 31, 2021 as compared to a net loss

of $284,860, for the three months ended March 31, 2020.

The increase in the loss is a result of the factors as described above.

Comprehensive

We recorded a gain (loss) for foreign currency translation adjustments for the three and nine months ended

September 30, 2020 and 2019, of $5,602 and $(494), and $(19,840) and $(893), respectively.

The fluctuations of the increase/decrease

are primarily attributed to the decrease recognized due to exchange rate variances.

Gain (Loss) .

We recorded a gain for foreign currency translation adjustments for the three months ended March 31, 2021

of $1,611 and a loss of $9,194 for the three months ended March 31, 2020.

and Capital Resources

is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise

operate on an ongoing basis.

At September 30, 2020, we had a cash balance of $817,013.

Our working capital is $95,587 at September

current assets at September 30, 2020 increased 82% from December 31, 2019 and included cash, accounts receivable, prepaid expenses,

unbilled revenue, right of use, inventory and other current assets.

current liabilities at September 30, 2020 increased 3.8% from December 31, 2019 and included our accounts payable, due to related

party, provision for income taxes, contract liabilities, current portion of notes payable, lease liabilities and other liabilities

in the ordinary course of our business.

September 30, 2020, the Company had an accumulated deficit of $12,473,923, positive working capital of $95,587 and net loss of

$1,358,745 during the nine months ended September 30, 2020.

These factors raise substantial doubt about the Company’s ability

to continue as a going concern for one year from the issuance of the financial statements.

The ability of the Company to continue

as a going concern is dependent upon obtaining additional capital and financing.

Management intends to attempt to raise additional

funds by way of a public or private offering.

While the Company believes in the viability of its strategy to raise additional

funds, there can be no assurances to that effect.

is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate

on an ongoing basis.

At March 31, 2021, we had a cash balance of $559,282.

Our working capital is a negative $33,271 at March 31, 2021.

current assets at March 31, 2021 increased 13.5% from December 31, 2020 and included cash, accounts receivable, prepaid expenses, unbilled

revenue, right of use, inventory and other current assets.

current liabilities at March 31, 2021 increased 4.9% from December 31, 2020 and included our accounts payable, due to related party,

provision for income taxes, contract liabilities, lease liabilities and other liabilities in the ordinary course of our business.

March 31, 2021, the Company had an accumulated deficit of $14,681,695, negative working capital of approximately $33,271

and net loss of approximately $803,142 during the three months ended March 31, 2021.

For the year ended December 31, 2020, the auditors’

opinion contained a going concern paragraph, which stated that the Company had an accumulated deficit of $13,878,553, negative working

capital of $144,058 and net loss of $2,763,375 during the year ended December 31, 2020.

These factors raise substantial doubt about the

Company’s ability to continue as a going concern for one year from the issuance of the audited financial statements.

of the Company to continue as a going concern is dependent upon obtaining additional capital and financing.

Management intends to attempt

to raise additional funds by way of a public or private offering.

While the Company believes in the viability of its strategy to raise

additional funds, there can be no assurances to that effect.

Without additional capital, we will be unable to achieve our business objectives,

and may be forced to curtail our operations, reduce headcount, and/or temporarily cease our operations until requisite capital

The consolidated financial statements do not include any adjustments relating to classification of assets and liabilities

that might be necessary should the Company be unable to continue as a going concern.

cash flows provided by operating activities for the nine months ended September 30, 2020 amounted to $471,800 and were primarily

attributable to our net loss of $1,358,745, total amortization expense of $18,750 and depreciation of $199,242, amortization of

discount on debt of $752,130, fair value of options granted of $130,400, gain on extinguishment of debt of $269,261 and

net change in assets and liabilities of $63,839, primarily attributable to a decrease in accounts receivable of $81,739, an increase

in inventory of $135,648, decrease in prepaid expenses of $16,812, a decrease in unbilled revenue of $877, a decrease in other

current assets of $57,800, decrease in accounts payable of $61,747, a decrease in contract liabilities of $780, a decrease in

lease liabilities of $21,562, and a decrease in provision for income taxes of $1,330.

cash flows used in operating activities for the nine months ended September 30, 2019 amounted to $603,183 and were primarily attributable

and may be forced to curtail our operations, reduce headcount, and/or temporarily cease our operations until requisite capital is secured.

The consolidated financial statements do not include any adjustments relating to classification of assets and liabilities that might

be necessary should the Company be unable to continue as a going concern.

cash flows used by operating activities for the three months ended March 31, 2021 amounted to $459,764 and were primarily attributable

to our net loss of $803,142, total amortization expense of $6,250 and depreciation of $67,450, amortization of discount on debt

of $211,330, change in fair value of derivative liability of $69,677, amortization of right of use of $2,196, gain on debt extinguishment

of $134,677, long term debt issued for services of $113,000 and net change in assets and liabilities of $66,939, primarily attributable

to an increase in accounts receivable of $74,915, an increase in inventory of $179,186, increase in prepaid expenses of $35,789,

decrease in unbilled revenue of $19,087, an increase in other current assets of $39,505, increase in accounts payable of $217,680,

an increase in contract liabilities of $25,356 and an increase in provision for income taxes of $333.

cash flows used in investing activities were $30,752 and $51,414, for the nine months ended September 30, 2020 and 2019, respectively.

During the nine months ended September 30, 2020 and 2019, we purchased property and equipment of $30,752 and $51,414, respectively.

cash flows provided by financing activities were $1,263,333 and $601,944, for the nine months ended September 30, 2020 and 2019,

respectively.

Net cash flows provided by financing activities were $1,263,333 for the nine months ended September 30, 2020 and

were for proceeds from convertible notes payable of $958,000, proceeds from note payable provided by the US Payroll Protection

Program (“PPP”) of $20,832, proceeds from note payable of $323,075 and offset by repayments to related party payable

of $18,888 and repayments of line of credit for $19,685.

cash flows provided by financing activities were $601,944 for the nine months ended September 30, 2019 and were for proceeds from

convertible notes payable of $757,000, repayments of convertible notes payable of $87,778, repayments of amounts owed to related

parties of $20,856 and repayments of notes payable of $46,422.

of $501,164, stock based compensation of $14,200 and net change in assets and liabilities of $253,249, primarily attributable to an increase

in accounts receivable of $94,176, an increase in inventory of $239,490, an increase in unbilled revenue of $2,067, a decrease in right

of use of $7,563, an increase in other current assets of $19,195, increase in accounts payable of $114,261, a decrease in contract liabilities

of $5,157, a decrease in lease liabilities of $7,589, and an increase in provision for income taxes of $164.

cash flows provided by operating activities for the three months ended March 31, 2020 amounted to $64,712 and were primarily attributable

to our net loss of $284,860, total amortization expense of $6,250 and depreciation of $65,254, amortization of discount on debt of $74,837

and net change in assets and liabilities of $191,292, primarily attributable to a decrease in accounts receivable of $72,045, an increase

in inventory of $77,686, decrease in prepaid expenses of $12,652, a decrease in unbilled revenue of $5,368, a decrease in right of use

of $11,939, a decrease in other current assets of $76,609, increase in accounts payable of $120,709, a decrease in contract liabilities

of $5,136, a decrease in lease liabilities of $11,939, and a decrease in provision for income taxes of $1,330.

cash flows used in investing activities were $459 and $10,933 for the three months ended March 31, 2021 and 2020, respectively.

the three months ended March 31, 2021 and March 31, 2020, we purchased property and equipment of $459 and $10,933, respectively.

cash flows provided by financing activities were $289,131 for the three months ended March 31, 2021 and were for proceeds from a convertible

note payable of $350,000 which was offset by repayments of notes payable for $60,643 and related party note payable for $226.

cash flows provided by financing activities for the three months ended March 31, 2020 were $13,130 for the three months ended March 31,

2020 and were for proceeds from a related party payable of $20,536 which was offset by repayments of notes payable for $7,226.

Sheet Arrangements

do not currently have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect

on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures

or capital resources that are material to our stockholders.

company has not entered into any transaction, agreement or other contractual arrangement with an entity unconsolidated with us

under which we have:

obligation under a guarantee contract, although we do have obligations under certain sales arrangements including purchase

obligations to vendors

do not currently have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our

financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or

capital resources that are material to our stockholders.

company has not entered into any transaction, agreement or other contractual arrangement with an entity unconsolidated with us under

which we have

obligation under a guarantee contract, although we do have obligations under certain sales arrangements including purchase obligations

retained or contingent interest in assets transferred to the unconsolidated entity or similar arrangement that serves as credit,

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obligation, including a contingent obligation, under a contract that would be accounted for as a derivative instrument, or

obligation, including a contingent obligation, arising out of a variable interest in an unconsolidated entity that is held

by us and material to us where such entity provides financing, liquidity, market risk or credit risk support to, or engages

in leasing, hedging or research and development services with us.

obligation, including a contingent obligation, arising out of a variable interest in an unconsolidated entity that is held by us

and material to us where such entity provides financing, liquidity, market risk or credit risk support to, or engages in leasing,

hedging or research and development services with us.

Accounting Policies and Estimates

accounting estimates are those that management deems to be most important to the portrayal of our financial condition and results

of operations, and that require management’s most difficult, subjective or complex judgments, due to the need to make estimates

about the effects of matters that are inherently uncertain.

We have identified our critical accounting estimates which are discussed

preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported

amounts of assets and liabilities as of the date of the statements of financial condition, and revenues and expenses for the years

accounting estimates are those that management deems to be most important to the portrayal of our financial condition and results of

operations, and that require management’s most difficult, subjective or complex judgments, due to the need to make estimates about

the effects of matters that are inherently uncertain.

We have identified our critical accounting estimates which are discussed below.

preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts

of assets and liabilities as of the date of the statements of financial condition, and revenues and expenses for the years then ended.

Actual results may differ significantly from those estimates.

Significant estimates made by management include, but

are not limited to, the assumptions used to calculate stock-based compensation, derivative liabilities and common stock issued

for services.

Significant estimates made by management include, but are not limited to,

the assumptions used to calculate stock-based compensation, derivative liabilities and common stock issued for services.

of Presentation and Principles of Consolidation

consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States

of America (“US GAAP”).

The consolidated financial statements of the Company include the Company and its wholly-owned

subsidiaries, Orbital Satcom Corp.

consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America

(“US GAAP”).

The consolidated financial statements of the Company include the Company and its wholly-owned subsidiaries,

Orbital Satcom Corp.

and Global Telesat Communications Ltd.

All material intercompany balances and transactions

have been eliminated in consolidation.

receivable and allowance for doubtful accounts

Company has a policy of reserving for questionable accounts based on its best estimate of the amount of probable credit losses

in its existing accounts receivable.

The Company periodically reviews its accounts receivable to determine whether an allowance

is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account

may be in doubt.

Account balances deemed to be uncollectible are offset against sales and relieved from accounts receivable, after

all means of collection have been exhausted and the potential for recovery is considered remote.

As of September 30, 2020, and

2019, there is an allowance for doubtful accounts of $15,749 and $0, respectively.

All material intercompany balances and transactions have been eliminated

in consolidation.

Company has a policy of reserving for questionable accounts based on its best estimate of the amount of probable credit losses in its

existing accounts receivable.

The Company periodically reviews its accounts receivable to determine whether an allowance is necessary

based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt.

balances deemed to be uncollectible are offset against sales and relieved from accounts receivable, after all means of collection have

been exhausted and the potential for recovery is considered remote.

As of March 31, 2021, and 2020, there is an allowance for doubtful

accounts of $0 and $5,300, respectively.

are valued at the lower of cost or net realizable value, using the first-in first-out cost method.

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usage to their estimated net realizable value.

The Company estimates the net realizable value of such inventories based on analysis

and assumptions including, but not limited to, historical usage, expected future demand and market requirements.

A change to the

carrying value of inventories is recorded to cost of goods sold.

for Derivative Instruments

are required to be recorded on the balance sheet at fair value.

These derivatives, including embedded derivatives in the Company’s

structured borrowings, are separately valued and accounted for on the Company’s balance sheet.

Fair values for exchange

traded securities and derivatives are based on quoted market prices.

Where market prices are not readily available, fair values

are determined using market-based pricing models incorporating readily observable market data and requiring judgment and estimates.

Company did not identify any assets or liabilities that are required to be presented on the consolidated balance sheets at fair

value in accordance with the accounting guidance.

The carrying amounts reported in the balance sheet for cash, accounts payable,

and accrued expenses approximate their estimated fair market value based on the short-term maturity of the instruments.

The Company estimates the net realizable value of such inventories based on analysis and

assumptions including, but not limited to, historical usage, expected future demand and market requirements.

A change to the carrying

value of inventories is recorded to cost of goods sold.

and Development

Company accounts for research and development costs in accordance with the Accounting Standards Codification subtopic 730-10,

Research and Development (“ASC 730-10”).

Under ASC 730-10, all research and development costs must be charged to expense

Company accounts for research and development costs in accordance with the Accounting Standards Codification subtopic 730-10, Research

and Development (“ASC 730-10”).

Under ASC 730-10, all research and development costs must be charged to expense as incurred.

Accordingly, internal research and development costs are expensed as incurred.

Third-party research and development

costs are expensed when the contracted work has been performed or as milestone results have been achieved.

Company-sponsored research

and development costs related to both present and future products are expensed in the period incurred.

On February 19, 2015, the

Company issued 444 of its common stock, par value $0.0001, at $112.61 per share, or $50,000, to a consultant as compensation for

the design and delivery of dual mode gsm/Globalstar Simplex tracking devices and related hardware and intellectual property.

the year ended December 31, 2019, the Company recorded an impairment charge of $50,000 for the above-mentioned other asset, due

to the delay in its launch to our existing product lines.

For the nine months ended September 30 30, 2020 and 2019, there were

no additional expenditures on research and development.

Third-party research and development costs are expensed

when the contracted work has been performed or as milestone results have been achieved.

Company-sponsored research and development costs

related to both present and future products are expensed in the period incurred.

For the three months ended March 31, 2021 and 2020,

there were no additional expenditures on research and development.

Currency Translation

Company’s reporting currency is U.S.

The accounts of one of the Company’s subsidiaries, GTCL, is maintained

using the appropriate local currency, Great British Pound, as the functional currency.

All assets and liabilities are translated

The accounts of one of the Company’s subsidiaries, GTCL, is maintained using

the appropriate local currency, Great British Pound, as the functional currency.

All assets and liabilities are translated into U.S.

Dollars at balance sheet date, shareholders’

equity is translated at historical rates and revenue and expense

accounts are translated at the average exchange rate for the year or the reporting period.

The translation adjustments are reported

as a separate component of stockholders’

equity is translated at historical rates and revenue and expense accounts are translated

at the average exchange rate for the year or the reporting period.

The translation adjustments are reported as a separate component of

stockholders’

equity, captioned as accumulated other comprehensive (loss) gain.

Transaction gains

and losses arising from exchange rate fluctuations on transactions denominated in a currency other than the functional currency

are included in the statements of operations.

Transaction gains and losses arising from exchange

rate fluctuations on transactions denominated in a currency other than the functional currency are included in the statements of operations.

relevant translation rates are as follows:

for the three and nine months ended September 30, 2020, closing rate at 1.2923 US$:

GBP, quarterly average rate at 1.2932 US$:

GBP and yearly average rate at 1.2717 US$:

GBP, for the three and nine months ended

September 30, 2019, closing rate at 1.2698 US$:

GBP, quarterly average rate at 1.2938 US$:

GBP and yearly average rate of 1.2853,

for the year ended 2019 closing rate at 1.3262 US$:

for the three months ended March 31, 2021, closing rate at 1.3783 US$:

GBP, quarterly average

rate at 1.379068 US$:

GBP, for the three months ended March 31, 2020, closing rate at 1.245481 US$:

GBP, quarterly average rate at 1.281097

GBP, for the year ended 2020 closing rate at 1.3665 US$:

GBP, average rate at 1.286618 US$:

the three and nine months ended September 30, 2020, Global Telesat Communications LTD, (GTCL) represents 66.2% and 63.9% of total

company sales and as such, currency rate variances have an impact on results.

the three months ended September 30, 2020, the net effect on revenues were impacted by the differences in exchange rate from quarterly

average exchange of 1.2938 to 1.2853.

Had the quarterly average rate remained at 1.2938, sales for the three months ended September

30, 2020 would have been higher by $2,304.

GTCL comparable sales in GBP, its home currency, decreased 22.0% or £271,079,

from £1,233,770 to £962,692, for the three months ended September 30, 2020 as compared to September 30, 2019.

the nine months ended September 30, 2020, the net effect on revenues were impacted by the differences in exchange rate from yearly

average exchange of 1.2853 to 1.2717.

Had the yearly average rate remained at 1.2583, sales for the nine months ended September

30, 2020 would have been higher by $4,369.

GTCL comparable sales in GBP, its home currency, decreased 10.3% or £321,284,

from £3,116,839 to £2,795,555, for the nine months ended September 30, 2020 as compared to September 30, 2019.

the nine months ended September 30, 2019, GTCL represented 70.2% of total company sales and as such, currency rate variances have

an impact on results.

For the nine months ended September 30, 2019 the net effect on revenues were impacted negatively by the

differences in exchange rate from yearly average exchange rate of 1.35130 to 1.27327.

Had the yearly average rate remained, sales

would have been higher by $191,712.

GTCL comparable sales in GBP, its home currency, increased 3.7% or £86,535, from £2,370,301

to £2,456,836 for the nine months ended September 30, 2019 as compared to September 30, 2018.

Recognition and Unearned Revenue

Company recognizes revenue from satellite services when earned, as services are rendered or delivered to customers.

sales revenue is recognized when the equipment is delivered to and accepted by the customer.

Only equipment sales are subject

Historically, the Company has not incurred significant expenses for warranties.

Equipment sales revenue

is recognized when the equipment is delivered to and accepted by the customer.

Only equipment sales are subject to warranty.

Historically,

the Company has not incurred significant expenses for warranties.

Company’s customers generally purchase a combination of our products and services as part of a multiple element arrangement.

The Company’s assessment of which revenue recognition guidance is appropriate to account for each element in an arrangement

can involve significant judgment.

Company’s assessment of which revenue recognition guidance is appropriate to account for each element in an arrangement can involve

significant judgment.

This assessment has a significant impact on the amount and timing of revenue recognition.

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which we expect to receive in exchange for those goods or services.

To determine revenue recognition for arrangements that the

Company determines are within the scope of ASC 606, we perform the following five steps:

To determine revenue recognition for arrangements that the Company

determines are within the scope of ASC 606, we perform the following five steps:

(i) identify the contract(s) with a customer;

(ii) identify the performance obligations in the contract;

(ii) identify

the performance obligations in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction

price to the performance obligations in the contract;

(iv) allocate the transaction price to the performance

obligations in the contract;

and (v) recognize revenue when (or as) we satisfy a performance obligation.

The five-step model is applied to contracts when it is probable that we will collect the consideration we are entitled to in exchange

for the goods or services transferred to the customer.

At contract inception, once the contract is determined to be within the

scope of ASC 606, we assess the goods or services promised within each contract and determine those that are performance obligations

and assess whether each promised good or service is distinct.

We then recognize revenue in the amount of the transaction price

that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The five-step model is applied

to contracts when it is probable that we will collect the consideration we are entitled to in exchange for the goods or services transferred

to the customer.

At contract inception, once the contract is determined to be within the scope of ASC 606, we assess the goods or services

promised within each contract and determine those that are performance obligations and assess whether each promised good or service is

We then recognize revenue in the amount of the transaction price that is allocated to the respective performance obligation

when (or as) the performance obligation is satisfied.

recognize revenue in accordance with Accounting Standards Codification (“ASC”) 606, ):

Narrow-Scope Improvements

and Practical Expedient , which is to (1) clarify the objective of the collectability criterion for applying paragraph 606-10-25-7;

(2) permit an entity to exclude amounts collected from customers for all sales (and other similar) taxes from the transaction

(3) specify that the measurement date for noncash consideration is contract inception;

(4) provide a practical expedient

that permits an entity to reflect the aggregate effect of all modifications that occur before the beginning of the earliest period

presented when identifying the satisfied and unsatisfied performance obligations, determining the transaction price, and allocating

the transaction price to the satisfied and unsatisfied performance obligations;

(5) clarify that a completed contract for purposes

of transition is a contract for which all (or substantially all) of the revenue was recognized under legacy GAAP before the date

of initial application, and (6) clarify that an entity that retrospectively applies the guidance in Topic 606 to each prior reporting

period is not required to disclose the effect of the accounting change for the period of adoption.

The amendments of this ASU

are effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years.

impact as a result of adopting this ASU on the financial statements and related disclosures.

Narrow-Scope Improvements and Practical

Expedient , which is to (1) clarify the objective of the collectability criterion for applying paragraph 606-10-25-7;

(2) permit an

entity to exclude amounts collected from customers for all sales (and other similar) taxes from the transaction price;

(3) specify that

the measurement date for noncash consideration is contract inception;

(4) provide a practical expedient that permits an entity to reflect

the aggregate effect of all modifications that occur before the beginning of the earliest period presented when identifying the satisfied

and unsatisfied performance obligations, determining the transaction price, and allocating the transaction price to the satisfied and

unsatisfied performance obligations;

(5) clarify that a completed contract for purposes of transition is a contract for which all (or

substantially all) of the revenue was recognized under legacy GAAP before the date of initial application, and (6) clarify that an entity

that retrospectively applies the guidance in Topic 606 to each prior reporting period is not required to disclose the effect of the accounting

change for the period of adoption.

The amendments of this ASU are effective for fiscal years beginning after December 15, 2017, and interim

periods within those fiscal years.

There was no impact as a result of adopting this ASU on the financial statements and related disclosures.

Company provides product warranties with varying lengths of time and terms.

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in nature and do not cover anything beyond ensuring that the product is functioning as intended.

Based on the guidance in ASC

606, assurance-type warranties do not represent separate performance obligations.

The Company also sells separately priced maintenance

service contracts which qualify as service-type warranties and represent separate performance obligations.

The Company has historically

experienced a low rate of product returns under the warranty program.

Based on the guidance in ASC 606, assurance-type

warranties do not represent separate performance obligations.

The Company also sells separately priced maintenance service contracts

which qualify as service-type warranties and represent separate performance obligations.

The Company has historically experienced a low

rate of product returns under the warranty program.

variety of technical services can be contracted by our customers for a designated period of time.

The service contracts allow

customers to call the Company for technical support, replace defective parts and to have onsite service provided by the Company’s

third-party contract service provider.

The Company records revenues for contract services at the amount of the service contract,

but such amount is deferred at the beginning of the service term and amortized ratably over the life of the contract.

Company believes that its products and services can be accounted for separately as its products and services have value to the

Company’s customers on a stand-alone basis.

When a transaction involves more than one product or service, revenue is allocated

to each deliverable based on its relative fair value;

otherwise, revenue is recognized as products are delivered or as services

are provided over the term of the customer contract.

The service contracts allow customers

to call the Company for technical support, replace defective parts and to have onsite service provided by the Company’s third-party

contract service provider.

The Company records revenues for contract services at the amount of the service contract, but such amount

is deferred at the beginning of the service term and amortized ratably over the life of the contract.

Company believes that its products and services can be accounted for separately as its products and services have value to the Company’s

customers on a stand-alone basis.

When a transaction involves more than one product or service, revenue is allocated to each deliverable

based on its relative fair value;

otherwise, revenue is recognized as products are delivered or as services are provided over the term

of the customer contract.

liabilities is shown separately in the condensed consolidated balance sheets as current liabilities.

At September 30, 2020 and

2019, we had contract liabilities of approximately $118,449 and $45,057.

At December 31, 2019, we had contract liabilities of

approximately $41,207.

At March 31, 2021, we had contract

liabilities of approximately $31,547.

At December 31, 2020, we had contract liabilities of approximately $36,704.

and Equipment

and equipment are carried at historical cost less accumulated depreciation.

Depreciation is based on the estimated service lives

of the depreciable assets and is calculated using the straight-line method.

Expenditures that increase the value or productive

capacity of assets are capitalized.

Fully depreciated assets are retained in the property and equipment, and accumulated depreciation

accounts until they are removed from service.

When property and equipment are retired, sold or otherwise disposed of, the asset’s

carrying amount and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations.

Repairs and maintenance are expensed as incurred.

Depreciation is based on the estimated service lives of the

depreciable assets and is calculated using the straight-line method.

Expenditures that increase the value or productive capacity of assets

are capitalized.

Fully depreciated assets are retained in the property and equipment, and accumulated depreciation accounts until they

are removed from service.

When property and equipment are retired, sold or otherwise disposed of, the asset’s carrying amount and

related accumulated depreciation are removed from the accounts and any gain or loss is included in operations.

Repairs and maintenance

are expensed as incurred.

estimated useful lives of property and equipment are generally as follows:

Office furniture and fixtures

Computer equipment

Rental equipment

Website development

furniture and fixtures

of long-lived assets

Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount

of the assets may not be fully recoverable, or at least annually.

The Company recognizes an impairment loss when the sum of expected

undiscounted future cash flows is less than the carrying amount of the asset.

The amount of impairment is measured as the difference

between the asset’s estimated fair value and its book value.

The Company did not consider it necessary to record any impairment

charges during the periods ended September 30, 2020 and December 31, 2019, respectively.

Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the

assets may not be fully recoverable, or at least annually.

The Company recognizes an impairment loss when the sum of expected undiscounted

future cash flows is less than the carrying amount of the asset.

The amount of impairment is measured as the difference between the asset’s

estimated fair value and its book value.

The Company did not consider it necessary to record any impairment charges during the periods

ended March 31, 2021 and December 31, 2020, respectively.

value of financial instruments

Company adopted FASB ASC 820, “Fair Value Measurements and Disclosures”, for assets and liabilities measured at fair

value on a recurring basis.

ASC 820 establishes a common definition for fair value to be applied to existing US GAAP that require

the use of fair value measurements which establishes a framework for measuring fair value and expands disclosure about such fair

value measurements.

Company adopted FASB ASC 820, “Fair Value Measurements and Disclosures”, for assets and liabilities measured at fair value

on a recurring basis.

ASC 820 establishes a common definition for fair value to be applied to existing US GAAP that require the use of

fair value measurements which establishes a framework for measuring fair value and expands disclosure about such fair value measurements.

820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction

between market participants at the measurement date.

Additionally, ASC 820 requires the use of valuation techniques that maximize

the use of observable inputs and minimize the use of unobservable inputs.

Additionally, ASC 820 requires the use of valuation techniques that maximize the

use of observable inputs and minimize the use of unobservable inputs.

These inputs are prioritized below:

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Observable market-based inputs or unobservable inputs that are corroborated by market data

Unobservable inputs for which there is little or no market data, which require the use of the reporting entity’s own

Company did not identify any other assets or liabilities that are required to be presented on the consolidated balance sheets

at fair value in accordance with the accounting guidance.

The carrying amounts reported in the balance sheet for cash, accounts

payable, and accrued expenses approximate their estimated fair market value based on the short-term maturity of the instruments.

Unobservable inputs for which there is little or no market data, which require the use of the reporting entity’s own assumptions.

following table presents a reconciliation of the derivative liability measured at fair value on a recurring basis using significant unobservable

input (Level 3) from January 1, 2020 to March 31, 2021:

at January 1, 2020

in fair value included in earnings

at March 31, 2020

in fair value included in earnings

at March 31, 2021

Company did not identify any other assets or liabilities that are required to be presented on the consolidated balance sheets at fair

value in accordance with the accounting guidance.

The carrying amounts reported in the balance sheet for cash, accounts payable, and

accrued expenses approximate their estimated fair market value based on the short-term maturity of the instruments.

cost relating to share-based payment transactions are recognized in the financial statements.

The cost is measured at the grant

date, based on the calculated fair value of the award, and is recognized as an expense over the employee’s requisite service

period (generally the vesting period of the equity award).

The cost is measured at the grant date,

based on the calculated fair value of the award, and is recognized as an expense over the employee’s requisite service period (generally

the vesting period of the equity award).

Accounting Pronouncements

May 2016, the FASB issued ASU No.

2016-12, Revenue from Contracts with Customers (Topic 606):

Narrow-Scope Improvements and

Practical Expedient , which is to (1) clarify the objective of the collectability criterion for applying paragraph 606-10-25-7;

(2) permit an entity to exclude amounts collected from customers for all sales (and other similar) taxes from the transaction

(3) specify that the measurement date for noncash consideration is contract inception;

(4) provide a practical expedient

that permits an entity to reflect the aggregate effect of all modifications that occur before the beginning of the earliest period

presented when identifying the satisfied and unsatisfied performance obligations, determining the transaction price, and allocating

the transaction price to the satisfied and unsatisfied performance obligations;

(5) clarify that a completed contract for purposes

of transition is a contract for which all (or substantially all) of the revenue was recognized under legacy GAAP before the date

of initial application, and (6) clarify that an entity that retrospectively applies the guidance in Topic 606 to each prior reporting

period is not required to disclose the effect of the accounting change for the period of adoption.

The amendments of this ASU

are effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years.

impact as a result of adopting this ASU on the financial statements and related disclosures.

CORP AND SUBSIDIARIES

ORBITAL TRACKING CORP.

TO CONSOLIDATED FINANCIAL STATEMENTS

January 2016, the FASB issued ASU No.

2016-01, Financial Instruments —

Recognition and Measurement of Financial

Assets and Financial Liabilities.

The guidance affects the accounting for equity investments, financial liabilities under

the fair value option and the presentation and disclosure requirements of financial instruments.

The guidance is effective in

the first quarter of fiscal 2019.

Early adoption is permitted for the accounting guidance on financial liabilities under the fair

value option.

There was no impact as a result of adopting this ASU on the financial statements and related disclosures.

May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718 ) :

Scope of Modification Accounting

(ASU 2016-09), which provides guidance about which changes to the terms or conditions of a share-based payment award require

an entity to apply modification accounting in Topic 718, such as the repricing of share options, which would revalue those options

and the accounting for the cancellation of an equity award whether a replacement award or other valuable consideration is issued

in conjunction with the cancellation.

If not, the cancellation is viewed as a replacement and not a modification, with a repurchase

This pronouncement is effective for annual reporting periods beginning after December 15, 2017.

The Company adopted

this standard on January 1, 2018 and did not have a material impact on the Company’s financial statements.

July 2017, the FASB issued ASU No.

2017-11, Earnings Per Share, Distinguishing Liabilities from Equity and Derivatives and

Hedging , which changes the accounting and earnings per share for certain instruments with down round features.

The amendments

in this ASU are applied using a cumulative-effect adjustment as of the beginning of the fiscal year or retrospective adjustment

to each period presented and is effective for annual periods beginning after December 15, 2018, and interim periods within those

December 22, 2017, the SEC issued Staff Accounting Bulletin 118 (SAB 118), which provides guidance on accounting for the tax effects

of the Tax Cuts and Jobs Act (the “TCJA”).

SAB 118 provides a measurement period that should not extend beyond one

year from the enactment date for companies to complete the accounting under ASC 740.

In accordance with SAB 118, a company must

reflect the income tax effects of those aspects of the TCJA for which the accounting under ASC 740 is complete.

To the extent

that a company’s accounting for certain income tax effects of the TCJA is incomplete but for which they are able to determine

a reasonable estimate, it must record a provisional amount in the financial statements.

Provisional treatment is proper in light

of anticipated additional guidance from various taxing authorities, the SEC, the FASB, and even the Joint Committee on Taxation.

If a company cannot determine a provisional amount to be included in the financial statements, it should continue to apply ASC

740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the TCJA.

has applied this guidance to its consolidated financial statements.

November 2018, the FASB amended Topic 842, Leases, by issuing ASU No.

2 unchanged sentences

Topic 842 with ASU No.

2018-01, Land Easement Practical Expedient

for Transition to Topic 842;

2018-01, Land Easement Practical Expedient for

Transition to Topic 842;

2018-10, Codification Improvements to Topic 842, Leases;

2018-11, Targeted Improvements.

The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability

on the balance sheet for all leases with a term longer than 12 months.

Leases will be classified as finance or operating, with

classification affecting the pattern and classification of expense recognition in the income statement.

The new standard was effective

for us on January 1, 2019, however the Company did not have any leases that met the criteria as established above, until July

24, 2019, when the Company entered into a three year lease for its UK office and warehouse for annual rent of £25,536 or

USD using exchange rate close for the nine months ended September 30, 2020, for liability of GBP:USD 1.292300 or $33,000.

An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in

the financial statements as its date of initial application.

If an entity chooses the second option, the transition requirements

for existing leases also apply to leases entered into between the date of initial application and the effective date.

must also recast its comparative period financial statements and provide the disclosures required by the new standard for the

comparative periods.

Consequently, financial information will not be updated, and the disclosures required under the new standard

will not be provided for dates and periods before January 1, 2019.

September 30, 2020, the Company had current and long-term operating lease liabilities of $28,489 and $28,667, respectively, and

right of use assets of $59,906.

accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected

to have a material impact on the consolidated financial statements upon adoption.

The Company does not discuss recent pronouncements

that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or

The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the

balance sheet for all leases with a term longer than 12 months.

Leases will be classified as finance or operating, with classification

affecting the pattern and classification of expense recognition in the income statement.

The new standard was effective for us on January

1, 2019, however the Company did not have any leases that met the criteria as established above, until July 24, 2019, when the Company

entered into a three-year lease for its UK office and warehouse for annual rent of £25,536 or GBP:

USD using exchange rate close

for the three months ended March 31, 2021, for liability of 1.3783 or $35,196.

An entity may choose to use either (1) its effective date

or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application.

an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date

of initial application and the effective date.

The entity must also recast its comparative period financial statements and provide the

disclosures required by the new standard for the comparative periods.

Consequently, financial information will not be updated, and the

disclosures required under the new standard will not be provided for dates and periods before January 1, 2019.

March 31, 2021, the Company had current and long-term operating lease liabilities of $30,385 and $14,725, respectively, and right of

use assets of $48,043.

accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have

a material impact on the consolidated financial statements upon adoption.

The Company does not discuss recent pronouncements that are

not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

a smaller reporting company, as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange

Act”), we are not required to provide the information required by this Item.

a smaller reporting company, as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”),

we are not required to provide the information required by this Item.

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-Q

Item 1. Financial Statements