What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2021-11-15 compared with 2021-08-17 · 245 added, 213 removed, 356 unchanged (56% of the section changed)

32 unchanged sentences

rental service for customers who desire to use our equipment for a limited time period.

Our acquisition of GTCL in February 2015 expanded

Our acquisition of GTC in February 2015 expanded

our global satellite-based infrastructure and business, which was first launched in December 2014 through the purchase of certain contracts.

64 unchanged sentences

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 six months ended June 30, 2021 and the year ended December 31, 2020 reflect this impact;

of operations for the nine months ended September 30, 2021 and the year ended December 31, 2020 reflect this impact;

however, we expect

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(“CBILS”) and the deferral of certain UK taxes.

of June 30, 2021, there were 50,000,000 shares of common stock authorized and 5,476,918 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 30,000 common stock upon the conversion of $30,000 of its convertible debt, at the

conversion rate of $1.00 per share.

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

at the conversion rate of $1.00 per share.

February 23, 2021, the Company issued an aggregate of 120,000 common stock upon the conversion of $150,000 of its convertible debt, at

the conversion rate of $1.25 per share.

February 23, 2021, the Company issued an aggregate of 1,000 common stock for services in the amount of $14,200.

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

conversion rate of $1.00 per share.

March 1, 2021, the Company issued an aggregate of 38,616 common stock upon the conversion of $48,270 of its convertible debt, at the

conversion rate of $1.25 per share.

Reverse Stock Split

March 24, 2021, the Company’s shareholders via majority shareholder consent authorized a stock split not to exceed 1 for 5 reverse

A definitive Information Statement relating to the shareholder consent was filed with the SEC on March 13, 2021.

Company’s Board of Directors subsequently approved a 1-for-5 reverse stock split.

The Company has filed a Certificate

of Change to its Amended and Restated Articles of Incorporation to effect a reverse stock split of its issued and outstanding common

stock, at a ratio of 1-for-5.

The effective time of the reverse stock split was 12:01 a.m.

subsequently approved a 1-for-5 reverse stock split.

The Company filed a Certificate of Change to its Amended and Restated Articles of

Incorporation to effect a reverse stock split of its issued and outstanding common stock, at a ratio of 1-for-5.

The effective time of

the reverse stock split was 12:01 a.m.

ET on May 28, 2021.

The Company’s

common stock began trading on a split-adjusted basis commencing upon market open on May 28, 2021.

The common stock has been

assigned a new CUSIP number, 68557F 209.

The warrants were assigned the CUSIP number, 68557F 118.

No fractional shares

of common stock will be issued as a result of the reverse stock split.

Stockholders of record who would otherwise be entitled to receive

a fractional share received a whole share.

May 20, 2021, the Company issued an aggregate of 29,800 common stock upon the conversion of $29,800 of its convertible debt, at

the conversion rate of $1.00 per share.

May 27, 2021, the Company issued an aggregate of 897,231 common stock upon the conversion of $1,156,377 of its convertible

debt, at a weighted average conversion rate of $1.28

The Company’s common stock began trading on a split-adjusted basis commencing

upon market open on May 28, 2021.

The common stock has been assigned a new CUSIP number, 68557F 209.

The warrants were assigned the CUSIP

number, 68557F 118.

No fractional shares of common stock were issued as a result of the reverse stock split.

Stockholders of record

who would otherwise be entitled to receive a fractional share received a whole share.

on the Nasdaq Capital Market

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Public Offering

May 28, 2021, Company, entered into an Underwriting Agreement with Maxim Group LLC (the “Underwriter”) pursuant to

which the Company agreed to issue and sell to the Underwriter in an underwritten public offering (the June Offering) 2,880,000

units consisting of one share of common stock and one warrant exercisable for one share of common stock at a public offering price of

$5.00 per unit (after giving effect to a 1-for-5 reverse stock split, discussed above) for aggregate gross proceeds of approximately

$14,400,000 before deducting underwriting discounts, commissions, and other offering expenses.

The common stock and warrants were immediately

separable and were issued separately.

The common stock and warrants began trading on the Nasdaq Capital Market, on May 28, 2021, under

the symbols “OSAT” and “OSATW,” respectively.

In addition, the Company granted the Underwriter a 45-day option

to purchase an additional 432,000 shares of common stock and/or warrants to purchase up to an aggregate of 432,000 shares of common stock,

in any combination thereof, at the public offering price per security, less the underwriting discounts and commissions, to cover over-allotments,

The June Offering closed on June 2, 2021.

In connection with closing

of the June Offering, the Underwriter partially exercised its overallotment option and purchased an additional 432,000 warrants at $0.01

per warrant for additional gross proceeds to the Company of $4,320.

On June 28, 2021, the Underwriter, upon the exercise in full of the

balance of its over-allotment option, purchased 432,000 additional shares of the common stock for additional gross proceeds to the Company

of $2,155,680.

We have issued to the Underwriter

warrants to purchase up to a total of 144,000 shares of common stock (5% of the shares of common stock included in the Units, excluding

the over-allotment, if any) (the “Underwriter Warrants”).

The Underwriter Warrants are exercisable at any time, and from

time to time, in whole or in part, during the period commencing 180 days from the effective date of the registration statement, and expire

five years from the effective date of the offering, which period is in compliance with FINRA Rule 5110(e).

The Underwriter Warrants are

exercisable at a per share price equal to $5.50 per share, or 110% of the public offering price per unit in the offering.

The Underwriter

Warrants have been deemed compensation by FINRA and are therefore subject to a 180-day lock-up pursuant to Rule 5110(e)(1) of FINRA.

The underwriter (or permitted assignees under Rule 5110(e)(2)) will not sell, transfer, assign, pledge, or hypothecate these warrants

or the securities underlying these warrants, nor will they engage in any hedging, short sale, derivative, put, or call transaction that

would result in the effective economic disposition of the warrants or the underlying securities for a period of 180 days from the effective

date of the registration statement.

In addition, the warrants provide for certain piggyback registration rights.

The piggyback registration

rights provided will not be greater than five years from the effective date of the registration statement in compliance with FINRA Rule

We will bear all fees and expenses attendant to registering the securities issuable on exercise of the Underwriter Warrants.

The exercise price and number of shares issuable upon exercise of the Underwriter Warrants may be adjusted in certain circumstances including

in the event of a stock dividend, extraordinary cash dividend or our recapitalization, reorganization, merger or consolidation.

the warrant exercise price or underlying shares will not be adjusted for issuances of shares of common stock at a price below the warrant

exercise price.

June 10, 2021, the Company issued 1,000 shares of common stock, for the exercise of 1,000 warrants, at an exercise price of $5.00, for

May 28, 2021, Company, entered into an Underwriting Agreement with Maxim Group LLC (the “Underwriter”) pursuant to which

the Company agreed to issue and sell to the Underwriter in an underwritten public offering (the June Offering) 2,880,000 units consisting

of one share of common stock and one warrant exercisable for one share of common stock at a public offering price of $5.00 per unit (after

giving effect to a 1-for-5 reverse stock split, discussed above) for aggregate gross proceeds of approximately $14,400,000 before deducting

underwriting discounts, commissions, and other offering expenses.

The common stock and warrants were immediately separable and were issued

The common stock and warrants began trading on the Nasdaq Capital Market, on May 28, 2021, under the symbols “OSAT”

and “OSATW,” respectively.

In addition, the Company granted the Underwriter a 45-day option to purchase an additional 432,000

shares of common stock and/or warrants to purchase up to an aggregate of 432,000 shares of common stock, in any combination thereof,

at the public offering price per security, less the underwriting discounts and commissions, to cover over-allotments, if any.

Offering closed on June 2, 2021.

connection with closing of the June Offering, the Underwriter partially exercised its overallotment option and purchased an additional

432,000 warrants at $0.01 per warrant for additional gross proceeds to the Company of $4,320.

On June 28, 2021, the Underwriter, upon

the exercise in full of the balance of its over-allotment option, purchased 432,000 additional shares of the common stock for additional

gross proceeds to the Company of $2,155,680.

have issued to the Underwriter warrants to purchase up to a total of 144,000 shares of common stock (5% of the shares of common stock

included in the Units, excluding the over-allotment, if any) (the “Underwriter Warrants”).

The Underwriter Warrants are exercisable

at any time, and from time to time, in whole or in part, during the period commencing 180 days from the effective date of the registration

statement, and expire five years from the effective date of the offering, which period is in compliance with FINRA Rule 5110(e).

Underwriter Warrants are exercisable at a per share price equal to $5.50 per share, or 110% of the public offering price per unit in

the offering.

The Underwriter Warrants have been deemed compensation by FINRA and are therefore subject to a 180-day lock-up pursuant

to Rule 5110(e)(1) of FINRA.

The underwriter (or permitted assignees under Rule 5110(e)(2)) will not sell, transfer, assign, pledge,

or hypothecate these warrants or the securities underlying these warrants, nor will they engage in any hedging, short sale, derivative,

put, or call transaction that would result in the effective economic disposition of the warrants or the underlying securities for a period

of 180 days from the effective date of the registration statement.

In addition, the warrants provide for certain piggyback registration

The piggyback registration rights provided will not be greater than five years from the effective date of the registration statement

in compliance with FINRA Rule 5110(g)(8).

We will bear all fees and expenses attendant to registering the securities issuable on exercise

of the Underwriter Warrants.

The exercise price and number of shares issuable upon exercise of the Underwriter Warrants may be adjusted

in certain circumstances including in the event of a stock dividend, extraordinary cash dividend or our recapitalization, reorganization,

merger or consolidation.

However, the warrant exercise price or underlying shares will not be adjusted for issuances of shares of common

stock at a price below the warrant exercise price.

Agreement with Alibaba

July 13, 2021, the Company announced that its Global Telesat

Communications Limited (“GTC”) unit had entered into an agreement with Alibaba.com, the B2B (Business-to-Business)

e-commerce website owned and operated by Alibaba Group Holding Limited, also known as Alibaba Group (NYSE:

9988), a Chinese

multinational technology company specializing in e-commerce, retail, internet, and technology.

GTC will be a Gold-level Supplier on Alibaba.com ,

the world’s largest Business-to-Business (B2B) e-commerce website.

the agreement, GTC significantly expands its 24/7/365 e-commerce presence with the launch of its latest global storefront.

Orbsat expects

to launch its new storefront during the third quarter with an extensive range of satellite IoT and connectivity products.

include Orbsat’s specialized satellite tracking products, some of which operate using the Company’s many ground station-based

network processors, and can be used to track and monitor the location of cars, trucks, trailers, boats, containers, animals, and

other remote assets.

Orbsat’s full catalog of 500+ products and connectivity services will be available on Alibaba.com by the start

of the first quarter of 2022.

The Company will pay an annual fee of $5,999 under the agreement.

The agreement will continue on a

year-to-year basis.

Equity Issuances

On June 10, 2021, the Company

issued 1,000 shares of common stock, for the exercise of 1,000 warrants, at an exercise price of $5.00, for cash consideration of $5,000.

On July 6, 2021, the Company

issued 78,500 shares of common stock, for the exercise of 78,500 warrants, at an exercise price of $5.00, for cash consideration of $392,500.

On July 8, 2021, the Company

issued 425,000 shares of common stock, for the exercise of 425,000 warrants, at an exercise price of $5.00, for cash consideration of

On July 12, 2021, the Company

issued 2,000 shares of common stock, for the exercise of 2,000 warrants, at an exercise price of $5.00, for cash consideration of $10,000.

On July 13, 2021, the Company

issued 59,853 shares of common stock, for the exercise of 59,853 warrants, at an exercise price of $5.00, for cash consideration of $299,265.

July 14, 2021, the Company issued 278,555 shares of common stock, for the exercise of 278,555 warrants, at an exercise price of $5.00,

for cash consideration of $1,392,775.

July 15, 2021, the Company issued 5,000 shares of common stock in connection with the exercise of 5,000 options, for cash consideration

July 19, 2021, the Company issued 1,000 shares of common stock, for the exercise of 1,000 warrants, at an exercise price of $5.00, for

cash consideration of $5,000.

July 30, 2021, the Company issued 80,000 shares of common stock, for the exercise of 80,000 warrants, at an exercise price of $5.00,

for cash consideration of $400,000.

September 3, 2021, the Company issued 10,000 shares of common stock in connection with restricted stock awards, with a fair market value

of $5.35 per share, from the date of the award.

September 14, 2021, the Company issued 40,000 shares of common stock in connection with restricted stock awards, with a fair market value

of $5.35 per share, from the date of the award.

September 22, 2021, the Company issued a total of 12,437 common shares for the exercise of 14,200 options through a cashless exercise

using 2,763 options for the $1.00 exercise price and in connection with a 1,000 restricted stock award.

Resource Planning System (ERP)

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in the period incurred and 60% will be capitalized and depreciated over its useful life.

of Operations for the Three and Six Months Ended June 30, 2021, compared to the Three and Six Months Ended June 30, 2020

Sales for the six months ended June 30, 2021, consisted primarily of sales of satellite phones, tracking devices, accessories and

airtime plans.

For the six months ended June 30, 2021, revenues generated were $3,417,688 compared to $2,688,357 of revenues

for the six months ended June 30, 2020, an increase in total revenues of $729,331 or 27.14%.

Total net sales

for Global Telesat Communications Ltd.

were $2,398,012 for the six months ended June 30, 2021, as compared to $1,666,937 for the six

months ended June 30, 2020, an increase of $731,075 or 43.9%.

of Operations for the Three and Nine months Ended September 30, 2021, compared to the Three and Nine months Ended September 30, 2020

Net Sales for the nine months ended September 30, 2021, consisted primarily of sales of satellite phones, tracking devices, accessories

and airtime plans.

For the nine months ended September 30, 2021, revenues generated were $5,667,966 compared to $4,163,750 of revenues

for the nine months ended September 30, 2020, an increase in total revenues of $1,504,216 or 36.1%.

Total net sales for Global Telesat

Communications Limited were $3,897,254 for the nine months ended September 30, 2021, as compared to $2,667,144 for the nine months

ended September 30, 2020, an increase of $1,230,110 or 46.1%.

Total net sales for Orbital Satcom Corp.

were $1,018,776

for the six months ended June 30, 2021, as compared to $1,021,420, for the six months ended June 30, 2020, a decrease of $2,642 or

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.

sales for the three months ended June 30, 2021, consisted primarily of sales of satellite phones, tracking devices, accessories and airtime

For the three months ended June 30, 2021, revenues generated were $1,956,260 compared to $1,220,254 of revenues for the

three months ended June 30, 2020, a increase in total revenues of $736,005 or 60.3%.

were $1,770,712 for the nine months

ended September 30, 2021, as compared to $1,496,606, for the nine months ended September 30, 2020, an increase of $274,106 or 18.3%.

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.

sales for the three months ended September 30, 2021, consisted primarily of sales of satellite phones, tracking devices, accessories

and airtime plans.

For the three months ended September 30, 2021, revenues generated were $2,250,278 compared to $1,475,393 of revenues

for the three months ended September 30, 2020, an increase in total revenues of $774,885 or 52.5%.

Total net sales for Global Telesat

Communications Ltd.

were $1,392,322 for the three months ended June 30, 2021, as compared to $716,820 for the three months ended

June 30, 2020, an increase of $675,502 or 94.3%.

Communications Limited.

were $1,498,341 for the three months ended September 30, 2021, as compared to $1,003,875 for the three

months ended September 30, 2020, an increase of $494,466 or 49.3%.

Total net sales for Orbital Satcom Corp.

were $563,938 for the three months

ended June 30, 2021 as compared to $503,434, for the three months ended June 30, 2020, an increase of $60,504 or 12.0%.

During the six months ended June 30, 2021, cost of sales increased to $2,438,681 compared to $2,082,664, for

the six months ended June 30, 2020, an increase of $356,017 or 17.09%.

Gross profit margins during the six months ended June 30, 2021

were $751,937 for the three

months ended September 30, 2021 as compared to $471,518, for the three months ended September 30, 2020, an increase of $280,419 or 59.5%.

During the nine months ended September 30, 2021, cost of sales increased to $4,195,823 compared to $3,159,593,

for the nine months ended September 30, 2020, an increase of $1,036,230 or 32.8%.

Gross profit margins during the nine months ended September

30, 2021 were 26.0% as compared to 24.1% for the comparable period in the prior year.

During the three months ended June 30, 2021, cost of sales

increased to $1,414,770 compared to $962,562, for the three months ended June 30, 2020, an increase of $452,208 or 46.98%.

margins during the three months ended June 30, 2021, were 27.69% as compared to 21.12% for the comparable period in the prior

As indicated by the results for the three and six months, our sales margins have increased by 6.57% and 6.12%, respectively.

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 second quarter ended June 30, 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 six months ended June 30, 2021 were $1,827,272, an increase of $841,096

or 85.29%, from total operating expenses for the six months ended June 30, 2020 of $986,177 .

During the three months ended September 30, 2021,

cost of sales increased to $1,757,142 compared to $1,076,929, for the three months ended September 30, 2020, an increase of $680,213

Gross profit margins during the three months ended September 30, 2021, were 21.9% as compared to 27.0% for the comparable

period in the prior year.

As indicated by the results for the three and nine months, our sales margins have (decreased) increased by

(5.1%) and 1.9%, respectively.

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 second quarter ended September 30, 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 nine months ended September 30, 2021 were $4,557,254, an increase of $2,698,242

or 145.14%, from total operating expenses for the nine months ended September 30, 2020 of $1,859,012 .

Total operating expenses

for the three months ended June 30, 2021 were $1,090,826, an increase of $643,890 or 144.07%, from total operating

expenses for the three months ended June 30, 2020 of $446,936 .

for the three months ended September 30, 2021 were $2,729,982, an increase of $1,857,147or 212.77%, from total operating expenses for

the three months ended September 30, 2020 of $872,835 .

Factors contributing to the decrease are described below.

general and administrative expenses were $443,696 and $304,171 for the six months ended June 30, 2021 and 2020, respectively,

general and administrative expenses were $962,892 and $486,984 for the nine months ended September 30, 2021 and 2020, respectively,

an increase of $475,908 or 97.73%.

Selling, general and administrative expenses were $282,006 and $146,965 for the

three months ended June 30, 2021 and 2020, respectively, an increase of $135,041 or 91.89%.

The increase, for the three

and six months ended June 30, 2021, is attributable to certain SG&A expenses such bank charges, credit card fees, Amazon fees,

and shipping charges that fluctuate with sales volatility.

wages and payroll taxes were $687,712 and $346,046 for the six months ended June 30, 2021 and 2020, respectively, an increase

of $341,666, or 98.73%.

Salaries, wages and payroll taxes were $479,538 and $150,404 for the three months ended June 30, 2021,

Selling, general and administrative expenses were $519,196 and $182,813 for the three months ended

September 30, 2021 and 2020, respectively, an increase of $336,383 or 184.00%.

The increase, for the three and nine months ended September

30, 2021, is attributable to certain variable expenses which are related to increase in sales such bank charges, credit card fees, Amazon

fees, and shipping charges that fluctuate with sales volatility, in combination with increased travel, medical and director and officer

insurance and auto expenses related to the increase in personnel, in addition to marketing and information technology expenses related

wages and payroll taxes were $1,178,267 and $542,675 for the nine months ended September 30, 2021 and 2020, respectively, an

increase of $635,592, or 117.12%.

Salaries, wages and payroll taxes were $490,555 and $196,629 for the three months ended September 30,

2021, and 2020, respectively, an increase of $293,926, or 149.48%.

The increase is a result of executive management adjusted salaries, increased

regular staff, and the payment of executive bonuses related to successful up-listing to Nasdaq approved by the board, for

the three and six months ended June 30, 2021.

fees were $548,916 and $191,665 for the six months ended June 30, 2021 and 2020, respectively, an increase of $357,251, or 186.39%.

Professional fees were $256,034 and $76,776 for the three months ended June 30, 2021 and 2020, respectively, an increase of $179,258,

The increase during the three and six months ended June 30, 2021 as compared to the same period in 2020, is attributable

to an increase in board members, increased investor relations and other professional fees to assist in capital raising efforts

as well as up-listing to Nasdaq.

and amortization expenses were $146,948 and $144,295 for the six months ended June 30, 2021 and 2020, respectively, an increase

For the three and nine months ended September 30, 2021, the increase

is attributable to an increase in officers from two to six and an increase in overall personnel to support growth, as well as board approved

executive bonuses related to successful up-listing to Nasdaq for the nine months ended September 30, 2021.

based compensation were $1,321,564 and $130,400 for the three and nine months ended September 30, 2021 and 2020, respectively,

an increase of $1,191,164, or 913.47%.

The increase is directly related to employment agreements for two additional officers, during

the three months ended September 30, 2021.

fees were $869,127 and $480,961 for the nine months ended September 30, 2021 and 2020, respectively, an increase of $388,166,

Professional fees were $320,211 and $289,296 for the three months ended September 30, 2021 and 2020, respectively, an increase

of $30,915, or 10.7%.

Depreciation and amortization expenses were $73,248 and $72,791 for the three months ended June 30, 2021 and 2020,

respectively, an increase of $457 or 0.63%.

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.

The increase during the three and nine months ended September 30, 2021 as compared to the same period in

2020, is attributable to an increase in board members, increased investor relations and other professional fees to assist in capital

raising efforts as well as up-listing to Nasdaq.

and amortization expenses were $225,404 and $217,992 for the nine months ended September 30, 2021 and 2020, respectively, an

increase of $7,412 or 3.40%.

Depreciation and amortization expenses were $78,456 and $73,697 for the three months ended September 30,

2021 and 2020, respectively, an increase of $4,759 or 6.45%.

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

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Similarly, we are unable at this time to estimate the amount of the expected

Total Other (Income)

Our total other expense (income) were $1,413,271 compared to $(122,190) during the six months ended

June 30, 2021 and 2020, respectively, an increase of $1,535,461 or 1,256.62%.

Our total other expense was $909,058 compared

to income of $(215,810) during the three months ended June 30, 2021 and 2020, respectively.

The increase in the three

and six months ended June 30, 2021, as compared to the prior year, is attributable to increased in interest expense $940,907 and $1,461,601,

respectively, relating the beneficial conversion feature for the convertible debt.

net loss before income tax of $1,458,394 and $2,261,536 for the three and six months ended June 30, 2021 as compared to a net income of

$26,566 and a net loss of $258,294, for the three and six months ended June 30, 2020.

The increase in the loss is a result of the factors

as described above.

Comprehensive Gain (Loss) .

We recorded a loss for foreign currency translation adjustments for the three and six months ended June 30, 2021 of $14,345 and $12,734.

For the three and six months ended June 30, 2020 we recorded a gain of $5,602 and a loss of $8,866.

Other (Income) Expense .

Our total other expense (income) were $1,481,974 compared to $503,890 during the nine months ended

September 30, 2021 and 2020, respectively, an increase of $978,084 or 194.11%.

The increase in the nine months ended September 30, 2021,

as compared to the prior year, is attributable to;

increases in interest expense of $666,179, interest earned of $3,066 and exchange

rate fluctuations of $34,749 and decreases in gain from extinguishment of debt of $248,429 and other income of $31,793.

total other expense was $68,703 compared to $626,080 during the three months ended September 30, 2021 and 2020, respectively.

of $557,377 for the three months ended September 30, 2021, as compared to the prior year, is attributable to a decrease in interest expense

$639,075, an increase of exchange rate fluctuations of $84,509, offset by interest earned of $3,079.

We recorded net loss before income tax of $2,305,549 and $4,567,085 for the three and nine months ended September 30, 2021

as compared to a net loss of $1,100,451 and $1,358,745, for the three and nine months ended September 30, 2020.

The increase in the loss

is a result of the factors as described above.

Comprehensive

Income (Loss) .

We recorded a gain for foreign currency translation adjustments for the three and nine months ended

September 30, 2021 of $55,584 and $42,850.

For the three and nine months ended September 30, 2020 we recorded a

gain of $5,602 and a loss of $19,840.

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 June 30, 2021, we had a cash balance of $14,415,649.

At September 30, 2021, we had a cash balance of $17,138,644.

Our working capital is a positive $17,768,275

at June 30, 2021.

Our current assets at June 30,

2021 increased $14,932,625 or 1,088% from December 31, 2020 and included cash, accounts receivable, VAT receivable, prepaid expenses,

unbilled revenue, inventory and other current assets.

current liabilities at June 30, 2021 increased $670,065 or 44.18% 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.

June 30, 2021, the Company had an accumulated deficit of $16,140,089, positive working capital of approximately $14,118,502

and net loss of approximately $2,261,536 during the six months ended June 30, 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 $567,022 and net loss of $2,763,375, during the year ended December 31, 2020.

As of the date of this report,

the Company’s existing cash resources and existing borrowing availability are sufficient to support planned operations for the

next 12 months.

As a result, management believes that the Company’s existing financial resources are sufficient to continue operating

activities for at least one year past the issuance date of the financial statements.

at September 30, 2021.

current assets at September 30, 2021 increased $17,640,784 or 1,285% from December 31, 2020 and included cash, accounts receivable,

VAT receivable, prepaid expenses, unbilled revenue, inventory and other current assets.

current liabilities at September 30, 2021 decreased $271,549 or 18% 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

September 30, 2021, the Company had an accumulated deficit of $18,445,638, positive working capital of approximately $17,768,275

and net loss of approximately $4,567,085 during the nine months ended September 30, 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 $144,055 and net loss of $2,763,375, during the year ended December 31, 2020.

As of the date of this report, the Company’s

existing cash resources and existing borrowing availability are sufficient to support planned operations for the next 12 months.

result, management believes that the Company’s existing financial resources are sufficient to continue operating activities for

at least one year past the issuance date of the financial statements.

financial statements have been prepared by management in accordance with GAAP and this basis assumes that the Company will continue as

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These financial statements do not include any adjustments that may result from the outcome of this uncertainty.

cash flows used by operating activities for the six months ended June 30, 2021 amounted to $1,270,837 and were primarily attributable

to our net loss of $2,261,536, total amortization expense of $12,500 and depreciation of $134,448, amortization of discount on

debt of $1,425,365, amortization of right to use of $15,476 gain on extinguishment of debt of $20,832, stock based compensation

of $14,200 and net change in assets and liabilities of $590,459, primarily attributable to an increase in accounts receivable

of $158,079, an increase in inventory of $790,536, an increase in unbilled revenue of $10,171, an increase in VAT receivable

of $279,215, an increase in other current assets of $3,664, increase in accounts payable of $662,022, an increase in contract liabilities

cash flows used by operating activities for the nine months ended September 30, 2021 amounted to $2,997,644 and were primarily

attributable to our net loss of $4,567,085, total amortization expense of $18,750 and depreciation of $206,654, amortization of discount

on debt of $1,425,365, amortization of right to use of $24,948 gain on extinguishment of debt of $20,832, stock based compensation of

$1,321,564 and net change in assets and liabilities of $1,421,208, primarily attributable to an increase in accounts receivable

of $132,808, an increase in inventory of $621,487, an increase in unbilled revenue of $22,353, an increase in VAT receivable of

$446,657, an increase in other current assets of $728, decrease in accounts payable of $168,557, an increase in contract liabilities

of $4,252, a decrease in lease liabilities of $24,898, and an increase in provision for income taxes of $37,603.

cash flows provided by operating activities for the six months ended June 30, 2020 amounted to $47,890 and were primarily attributable

to our net loss of $258,294, total amortization expense of $12,500 and depreciation of $131,795, amortization of discount on debt of

$128,702 gain on extinguishment of debt of $269,261 and net change in assets and liabilities of $283,285, primarily attributable to a

decrease in accounts receivable of $91,738, a decrease in inventory of $7,877, decrease in prepaid expenses of $14,506, a decrease in

unbilled revenue of $11,114, a decrease in right of use of $19,163, a decrease in other current assets of $72,392, increase in accounts

cash flows provided by operating activities for the nine months ended September 30, 2020 amounted to $504,800 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, stock based compensation of $130,400, stock issued for services of $62,750, amortization on right to use of $23,773, 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.

Net cash flows used in investing

activities were $27,248 and $26,159 for the six months ended June 30, 2021 and 2020, respectively.

During the six months ended June 30,

2021 and June 30, 2020, we purchased property and equipment of $27,248 and $26,159, respectively.

cash flows provided by financing activities were $14,997,706 for the six months ended June 30, 2021 and were for, proceeds

a convertible note payable of $350,000, related party payable of $114,981, the June Offering, of $14,649,573, proceeds of warrant exercise of $5,000 which was offset by repayments of notes payable for $121,848.

cash flows provided by financing activities were $225,201 and $602,691, for the six months ended June 30, 2020 and 2019, respectively.

Net cash flows provided by financing activities were $225,201 for the six months ended June 30, 2020 and were for proceeds from related

party payable of $58,917, proceeds from convertible notes payable of $157,500, proceeds from note payable provided by the US Payroll

Protection Program (“PPP”) of $20,832 and offset by repayments of line of credit for $12,048.

cash flows used in investing activities were $95,598 and $30,752 for the nine months ended September 30, 2021 and 2020, respectively.

During the nine months ended September 30, 2021 and September 30, 2020, we purchased property and equipment of $95,598 and $30,752, respectively.

cash flows provided by financing activities were $19,466,289 for the nine months ended September 30, 2021 and were for, proceeds

a convertible note payable of $350,000, related party payable of $34,238, the June Offering, of $14,649,573, proceeds of warrant

exercise of $4,629,540 which was offset by repayments of notes payable for $121,848, proceeds of options exercised of $5,000,

payments of coronavirus interruption loan of $11,189 and repayments to related party payable of $69,025.

cash flows provided by financing activities were $1,296,333 for the nine months ended September 30, 2020 and were for

proceeds from convertible notes payable of $958,000, proceeds from note payable of $343,907, proceeds from exercise of options

of $33,000, offset by repayments to related party payable of $18,889 and repayments of line of credit for

Sheet Arrangements

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been exhausted and the potential for recovery is considered remote.

As of June 30, 2021, and 2020, there is an allowance for doubtful

accounts of $15,782 and $14,155, respectively.

As of September 30, 2021, and December 31, 2020, there is

an allowance for doubtful accounts of $15,782 and $15,596, respectively.

are valued at the lower of cost or net realizable value, using the first-in first-out cost method.

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

For the six months ended June 30, 2021 and 2020, there

were no additional expenditures on research and development.

For the nine months ended September 30, 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 accounts of one of the Company’s subsidiaries, GTC, is maintained using

the appropriate local currency, Great British Pound, as the functional currency.

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relevant translation rates are as follows:

for the six months ended June 30, 2021, closing rate at 1.382800 US$:

GBP, quarterly average

rate at 1.397146 US$:

for the three and nine months ended September 30, 2021, closing rate at 1.342642 US$:

GBP, quarterly average rate at 1.3784972 US$:

GBP and yearly average rate at 1.3853499 US$:

GBP, for the six months ended June 30, 2020, closing rate at 1.245481

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

GBP, average rate at 1.286618

GBP and yearly average rate of 1.271713.

For the year ended December 31, 2020 closing rate at 1.260983 US$:

GBP, average rate

at 1.260983 US$:

Recognition and Unearned Revenue

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

At June 30, 2021, we had contract

At September 30, 2021, we had contract

liabilities of approximately $40,956.

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The Company did not consider it necessary to record any impairment charges during the periods

ended June 30, 2021 and December 31, 2020, respectively.

ended September 30, 2021 and December 31, 2020, respectively.

value of financial instruments

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USD using exchange rate close

for the six months ended June 30, 2021, for liability of 1.3828 or $35,311.

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.

June 30, 2021, the Company had current and long-term operating lease liabilities of $30,484 and $6,703, respectively, and right of use

for the nine months ended September 30, 2021, for liability of 1.3828 or $35,311.

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, 2021, the Company had current and long-term operating lease liabilities of $27,801 and $0, respectively, and right of use

assets of $30,658.

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis