Shareholders' Equity

9 Months Ended

Sep. 30, 2018

Equity [Abstract]

Shareholders' Equity

NOTE 14 – SHAREHOLDERS’ EQUITY

Common Stock

On June 2, 2014, the Company issued 10,000,000 shares of its common stock to Chisholm II in exchange for oil and natural gas assets recorded at $1,898,947.

As discussed above, the Company completed a reverse-merger with Dala Nevada, with Dala Nevada being the acquirer for financial reporting purposes. At the date of that Merger, the Company had 2,500,000 shares of common stock outstanding. The total amount of shares issued and outstanding post-Merger, as of December 31, 2014, was 12,500,000 shares of common stock.

On November 17, 2014, one of the Company’s shareholders of Series A 6% Convertible Preferred Stock, Chienn Consulting Company, converted 17 shares of its Series A 6% Convertible Preferred Stock into 24,286 shares of the Company’s common stock.

As part of the PCA executed in May 2016 (see NOTE 2), 9,597,800 shares of common stock were returned to the Company and recorded in treasury and were returned to the authorized but unissued shares of the Company.

On July 19, 2017, the Company issued 12,100,000 shares of common stock to M2.

On July 25, 2017, the Company issued 250,000 shares of our common stock as compensation and for a general release. We issued 50,000 shares to Daniel Ryweck for his service on our board of directors, and 200,000 to our attorney, Leonard W. Burningham, Esq., for certain of his legal services in the change of control involving M2 and pursuant to his Engagement Letter.

As discussed above, the Company completed a reverse-merger with KonaTel Nevada, with KonaTel Nevada being the acquirer for financial reporting purposes. At the date of the KonaTel Nevada Merger, the Company issued 13,500,000 shares of common stock to D. Sean McEwen, who was then the sole shareholder of KonaTel Nevada. At the date of the KonaTel Nevada Merger, 12,100,000 shares were owned by M2 (Messrs. Mark Savage and Matthew Atkinson were members of M2 and collectively owned approximately 65.2% of M2, which equated to an indirect beneficial ownership of approximately 3,950,000 shares of our common stock each), and with Mr. Atkinson being the sole Manager of M2, he was also the then beneficial owner of all of M2’s shares of our common stock; and 1,692,286 shares, which were owned by public shareholders. On April 24, 2018, the 12,100,000 shares of our common stock that were acquired by M2 under the Common Stock Purchase Agreement referenced above were distributed to its members, pro rata, in accordance with their respective membership interests.

On March 8, 2018, we issued 4,750,000 shares of our common stock in a private placement to “accredited investors” at $0.20 per share for an aggregate amount of $950,000. On April 16, 2018, we issued 1,000,000 shares of our common stock in a private placement to “accredited investors” at $0.20 per share for an aggregate amount of $200,000.

During the nine months period ended September 30, 2018, the Company recorded vested options expense of $454,434.

Also, see NOTE 2 above.

Stock Compensation

The Company offered stock option outstanding equity awards to directors and key employees. Options vested in tranches and do not expire for five years. During the nine months period ended September 30, 2018, the Company recorded vested options expense of $454,434.

The following table represents stock option activity as of and for the nine months ended September 30, 2018:

	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Life	Aggregate Intrinsic Value
Options Outstanding – December 31, 2017	3,925,000	$	0.21	4.2	$	-
Granted	150,000	$	0.33	4.4
Exercised
Forfeited
Options Outstanding – September 30, 2018	4,075,000	$	0.22	4.2	$	-
Options Vested and Expected to Vest, September 30, 2018	4,075,000	$	0.22	4.2	$	-
Exercisable and Vested, September 30, 2018	1,698,750	$	0.25	4.2	$	-