Data Call Technologies - Quarter Report: 2016 June (Form 10-Q)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________

FORM 10-Q
___________________

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2016

Commission file number 000-54696

DATA CALL TECHNOLOGIES, INC.
(Exact Name Of Registrant As Specified In Its Charter)

Nevada	30-0062823
(State of Incorporation)	(I.R.S. Employer Identification No.)

700 South Friendswood Drive, Suite E, Friendswood, TX	77546
(Address of Principal Executive Offices)	(ZIP Code)

Registrant's Telephone Number, Including Area Code: (866) 219-2025

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.

Large accelerated filer ¨

Accelerated filer ¨

Non-Accelerated filer ¨

Smaller reporting company x

On August 15, 2016, the Registrant had 144,976,421 shares of common stock outstanding.

TABLE OF CONTENTS

Item	Description	Page
____	_________	____
	PART I - FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS.	3
ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS AND RESULTS OF OPERATION.	14
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	18
ITEM 4.	CONTROLS AND PROCEDURES.	18

	PART II - OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS.	19
ITEM 1A.	RISK FACTORS.	19
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.	19
ITEM 3.	DEFAULT UPON SENIOR SECURITIES.	19
ITEM 4.	MINE SAFETY DISCLOSURE.	19
ITEM 5.	OTHER INFORMATION.	19
ITEM 6.	EXHIBITS.	19

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS Back to Table of Contents

Balance Sheets - June 30, 2016 (Unaudited) and December 31, 2015	4
Statements of Operations - Three and Six Months Ended June 30, 2016 and 2015 (Unaudited)	5
Statements of Cash Flows - Six Months Ended June 30, 2016 and 2015 (Unaudited)	6
Notes to Financial Statements	7

Data Call Technologies, Inc.
Balance Sheets
June 30, 2016 (Unaudited) and December 31, 2015
Table of Contents
		June 30, 2016
		(Unaudited)		December 31, 2015
Assets
Current assets:
Cash	$	72,292	$	85,810
Accounts receivable		71,790		56,846
Prepaid expenses		8,000		11,370
Total current assets		152,082		154,026

Property and equipment		128,573		128,573
Less accumulated depreciation and amortization		126,706		126,364
Net property and equipment		1,867		2,209

Other assets		800		800
Total assets	$	154,749	$	157,035

Liabilities and Stockholders' Equity

Current liabilities:
Accounts payable	$	20,566	$	18,684
Accounts payable - related party		6,037		3,767
Accrued salaries - related party		1,800		42
Accrued interest		21,991		21,741
Convertible short-term note payable to related party - in default		10,000		10,000
Deferred revenue - current		1,015		4,057
Short-term note payable to related party - in default		29,546		33,064
Total current liabilities		90,955		91,355

Total liabilities		90,955		91,355

Stockholders' equity:
Preferred stock, $0.001 par value. Authorized 10,000,000 shares:
Series A 12% Convertible - 800,000 shares issued and outstanding
at June 30, 2016 and December 31, 2015		800		800
Preferred stock, $0.001 par value. Authorized 1,000,000 shares:
Series B - 10,000 shares issued and outstanding
at June 30, 2016 and December 31, 2015		10		10
Common stock, $0.001 par value. Authorized 200,000,000 shares:
144,976,421 at June 30, 2016 and December 31, 2015		144,976		144,976
Additional paid-in capital		9,581,555		9,477,089
Accumulated deficit		(9,663,547)		(9,557,195)
Total stockholders' equity		63,794		65,680
Total liabilities and stockholders' equity	$	154,749	$	157,035

The accompanying notes are an integral part of these financial statements.

DATA CALL TECHNOLOGIES, INC.
Condensed Statements of Operations
Three and Six Months Ended June 30, 2016 and 2015 (Unaudited)
Back to Table of Contents
		Three Months		Three Months		Six Months		Six Months
		ended		ended		ended		ended
		June 30, 2016		June 30, 2015		June 30, 2016		June 30, 2015

Revenues
Sales	$	159,410	$	142,581	$	327,196	$	304,548
Cost of sales		35,406		35,493		77,452		70,138
Gross margin		124,004		107,088		249,744		234,410

Selling, general and administrative expenses		161,618		155,984		354,181		357,955
Depreciation and amortization expense		171		522		342		1,044
Total operating expenses		161,789		156,506		354,523		358,999

Other (income) expense
Interest income		(2)		(2)		(1,159)		(4)
Interest expense		1,366		1,366		2,732		2,732
Total expenses		163,153		157,870		356,096		361,727

Net loss before income taxes		(39,149)		(50,682)		(106,352)		(127,317)

Provision for income taxes		-		-		-		-
Net loss	$	(39,149)	$	(50,682)	$	(106,352)	$	(127,317)

Net income (loss) per common share - basic and diluted:
Net income (loss) applicable to common shareholders	$	(0.00)	$	(0.00)	$	(0.00)	$	(0.00)

Weighted average common shares:
Basic		144,976,421		144,844,553		144,976,421		138,865,924
Diluted		144,976,421		144,844,553		144,976,421		138,865,924

The accompanying notes are an integral part of these financial statements.

DATA CALL TECHNOLOGIES INC.
Condensed Statements of Cash Flows
Six Months Ended June 30, 2016 and 2015 (Unaudited)
Back to Table of Contents
		Six Months		Six Months
		Ended		Ended
		June 30, 2016		June 30, 2015
Cash flows from operating activities:
Net loss	$	(106,352)	$	(127,317)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation		342		1,044
Stock-based compensation		103,836		134,536
Options expense		629		1,765
Changes in operating assets and liabilities:
Accounts receivable		(14,944)		38,236
Prepaid expenses		3,370		(8,790)
Accounts payable		1,883		(6,279)
Accounts payable - related party		2,270		(5,530)
Accrued expenses		250		250
Accrued expenses - related party		1,758		(5,461)
Deferred revenues		(3,042)		(3,042)
Net cash provided by (used in) operating activities		(10,000)		19,412

Cash flows from investing activities
Purchase of property and equipment		-		-
Net cash used in investing activities		-		-

Cash flows from financing activities:
Principal payment on borrowing from related party		(3,518)		(3,519)
Net cash used in financing activities		(3,518)		(3,519)

Net increase (decrease) in cash		(13,518)		15,893
Cash at beginning of year		85,810		58,741
Cash at end of period	$	72,292	$	74,634

Supplemental Cash Flow Information:
Cash paid for interest	$	2,482	$	2,482
Cash paid for interest	$	-	$	-

The accompanying notes are an integral part of these financial statements.

DATA CALL TECHNOLOGIES, INC.
Notes to Financial Statements
June 30, 2016
Back to Table of Contents

(1) Summary of Significant Accounting Policies

Organization, Ownership and Business

Data Call Technologies, Inc. (the "Company") was incorporated under the laws of the State of Nevada in 2002. The Company's mission is to integrate cutting-edge information delivery solutions that are currently deployed by the media, and put them within the control of retail and commercial enterprises. The Company's software and services put its clients in control of real-time advertising, news, and other content, including emergency alerts, within one building or 10,000, local or thousands of miles away.

The accompanying unaudited financial statements have been prepared in accordance with U. S. generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and six-month period ended June 30, 2016 are not indicative of the results that may be expected for the year ending December 31, 2016.

As contemplated by the Securities and Exchange Commission (SEC) under Rules of Regulation S-X, the accompanying financial statements and related footnotes have been condensed and do not contain certain information that will be included in the Company's annual financial statements and footnotes thereto. For further information, refer to the Company's audited consolidated financial statements and related footnotes thereto included in the Company's annual report on Form 10-K for the year ended December 31, 2015.

Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company considers all highly liquid investment instruments purchased with original maturities of three months or less to be cash equivalents. There were no cash equivalents as of June 30, 2016 or December 31, 2015.

Revenue Recognition

The Company recognizes revenues based on monthly fees for services provided to customers. Some customers prepay for annual services and the Company defers such amounts and amortizes them into revenues as the service is provided.

Accounts Receivable

Accounts receivable consist primarily of trade receivables. The Company provides an allowance for doubtful trade receivables equal to the estimated uncollectible amounts. That estimate is based on historical collection experience, current economic and market conditions and a review of the current status of each customer's trade accounts receivable. The allowance for doubtful trade receivables was $0 as of June 30, 2016 and December 31, 2015 as we believe all of our receivables are fully collectable.

Property, Equipment and Depreciation

Property and equipment are recorded at cost less accumulated depreciation. Upon retirement or sale, the cost of the assets disposed of and the related accumulated depreciation are removed from the accounts, with any resultant gain or loss being recognized as a component of other income or expense. Depreciation is computed over the estimated useful lives of the assets (3-5 years) using the straight-line method for financial reporting purposes and accelerated methods for income tax purposes. Maintenance and repairs are charged to operations as incurred.

Advertising Costs

The cost of advertising is expensed as incurred.

Research and Development

Research and development costs are expensed as incurred.

Product Development Costs

Product development costs consist of cost incurred to develop the Company's website and software for internal and external use. All product development costs are expensed as incurred.

Income Taxes

The Company is a taxable entity and recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to be in effect when the temporary differences reverse. The effect on the deferred tax assets and liabilities of a change in tax rates is recognized in income in the year that includes the enactment date of the rate change. A valuation allowance is used to reduce deferred tax assets to the amount that is more likely than not to be realized.

Use of Estimates

The preparation of financial statements in conformity with U. S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could vary from those estimates.

Beneficial Conversion Feature

Convertible debt includes conversion terms that are considered in the money compared to the market price of the stock on the date of the related agreement. The Company calculates the beneficial conversion feature and records a debt discount with the amount being amortized to interest expense over the term of the note.

Management's Estimates and Assumptions

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses. Actual results could differ from these estimates.

Stock-Based Compensation

We account for stock-based compensation in accordance with "FASB ASC 718-10." Stock-based compensation expense recognized during the period is based on the value of the portion of share-based awards that are ultimately expected to vest during the period. The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model. The fair value of restricted stock is determined based on the number of shares granted and the closing price of the Company's common stock on the date of grant. Compensation expense for all share-based payment awards is recognized using the straight-line amortization method over the vesting period.

Fair Value of Financial Instruments

The Company estimates the fair value of its financial instruments using available market information and appropriate valuation methodologies. However, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the Company estimates of fair value are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The use of different market assumption and/or estimation methodologies may have a material effect on the estimated fair value amounts. The interest rates payable by the Company on its notes payable approximate market rates. The Company believes that the fair value of its financial instruments comprising accounts receivable, notes receivable, accounts payable, and notes payable approximate their carrying amounts.

On January 1, 2009, the Company adopted an accounting standard for applying fair value measurements to certain assets, liabilities and transactions that are periodically measured at fair value. The adoption did not have a material effect on the Company's financial position, results of operations or cash flows. In August 2009, the FASB issued an amendment to the accounting standards related to the measurement of liabilities that are routinely recognized or disclosed at fair value. This standard clarifies how a company should measure the fair value of liabilities, and that restrictions preventing the transfer of a liability should not be considered as a factor in the measurement of liabilities within the scope of this standard. This standard became effective for the Company on October 1, 2009. The adoption of this standard did not have a material impact on the Company's financial statements. The fair value accounting standard creates a three level hierarchy to prioritize the inputs used in the valuation techniques to derive fair values. The basis for fair value measurements for each level within the hierarchy is described below with Level 1 having the highest priority and Level 3 having the lowest.

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.

Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

The following table presents the Company's Assets and Liabilities within the fair value hierarchy utilized to measure fair value on a recurring basis as of June 30, 2016 and December 31, 2015:

		(Level 1)		(Level 2)		(Level 3)
June 30, 2016	$	0	$	0	$	0
December 31, 2015	$	0	$	0	$	0

Recent Accounting Pronouncements

In September, 2015, the FASB issued ASU No. 2015-16, Business Combinations (Topic 805) ("ASU 2015-16"). Topic 805 requires that an acquirer retrospectively adjust provisional amounts recognized in a business combination, during the measurement period. To simplify the accounting for adjustments made to provisional amounts, the amendments in the Update require that the acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The acquirer is required to also record, in the same period's financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. In addition an entity is required to present separately on the face of the income statement or disclose in the notes to the financial statements the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. ASU 2015-16 is effective for fiscal years beginning December 15, 2015. The adoption of ASU 2015-016 is not expected to have a material effect on the Company's consolidated financial statements.

In August, 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date ("ASU 2015-14"). The amendment in this ASU defers the effective date of ASU No. 2014-09 for all entities for one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 31, 2016, including interim reporting periods with that reporting period.

In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2015-03, Interest-Imputation of Interest (Subtopic 835-30) ("ASU 2015-03"), which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs will continue to be reported as interest expense. It is effective for annual reporting periods beginning after December 15, 2016. Early adoption is permitted. The new guidance will be applied retrospectively to each prior period presented. The Company is currently in the process of evaluating the impact of adoption of ASU 2015-03 on its balance sheets

The Company has considered all new accounting pronouncements and has concluded that there are no new pronouncements that may have a material impact on results of operations, financial condition, or cash flows, based on current information.

(2) Related Party Transactions

During the third quarter of 2013, the Company issued unregistered shares as follows: (i) 1,000,000 restricted shares to Jim Tevis, the Company's CTO, in connection with the execution of a new 2 year consulting agreement. The restricted shares were valued at $0.0185 per share using the closing price of the stock on the date of grant. Total expense associated with the issuances is calculated at $18,500 to be recognized over the 2 year term of the agreement. The expense recognized in the six months ended June 30, 2016 was $Nil. The expense recognized in the six months ended June 30, 2015 was $4,587.

During the first quarter of 2013, the Company issued unregistered shares as follows: (i) 7,500,000 restricted shares to Tim Vance, the Company's CEO, in connection with the execution of a new 5 year employment agreement; and 7,500,000 restricted shares to Gary Woerz, the Company's newly designated CFO, in connection with the execution of a new 5 year employment agreement. The restricted shares were valued at $0.06 per share using the closing price of the stock on the date of grant. Total expense associated with the issuances is calculated at $900,000 to be recognized over the 5 year term of the agreements. The expense recognized in the second quarter of 2016 was $44,318 (2015: $44,318) and $88,636 for the six months ended June 30, 2016 (2015: $88,149). The January 2013 employment agreements calls for a 5 year term ending January 30, 2018, annual compensation of $85,000 per year for services as CEO, annual compensation of $52,000 per year for services as CFO, 500,000 options to the CEO and 400,000 options to the CFO in addition to the 7,500,000 restricted shares to each the CEO and CFO.

During the first quarter of 2014, the Company granted a total of 900,000 options for the purchase of up to 900,000 shares of common stock to Tim Vance, the Company's CEO, in connection with the execution of a new 5 year employment agreement and to Gary Woerz, the Company's newly designated CFO, in connection with the execution of a new 5 year employment agreement. The Company uses the Black-Scholes option valuation model to value stock options granted. The Black- Scholes model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. The model requires management to make estimates, which are subjective and may not be representative of actual results. The Company recorded $Nil (June 30, 2015: $524) in stock option compensation expense, in relation to these options for the six month period ended June 30, 2016. The Black-Scholes model calculations included stock price on date of measurement of $0.30, exercise price of $0.001, a term of 1.5 years, computed volatility of 348% and a discount rate of 0.27%. The January 2014 employment agreements calls for a 5 year term ending January 30, 2018, annual compensation of $85,000 per year for services as CEO, annual compensation of $52,000 per year for services as CFO, 500,000 options to the CEO and 400,000 options to the CFO in addition to the 7,500,000 restricted shares to each the CEO and CFO.

During the first quarter of 2015, the Company granted a total of 900,000 options for the purchase of up to 900,000 shares of common stock to Tim Vance, the Company's CEO, in connection with the execution of a new 5 year employment agreement and to Gary Woerz, the Company's newly designated CFO, in connection with the execution of a new 5 year employment agreement. The Company uses the Black-Scholes option valuation model to value stock options granted. The Black- Scholes model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. The model requires management to make estimates, which are subjective and may not be representative of actual results. The Company recorded $266 (June 30, 2015: $1,241) in stock option compensation expense, in relation to these options for the six month period ended June 30, 2016. The Black-Scholes model calculations included stock price on date of measurement of $0.0036, exercise price of $0.001, a term of 1.5 years, computed volatility of 251% and a discount rate of 0.33%. The January 2015 employment agreements calls for a 5 year term ending January 30, 2018, annual compensation of $85,000 per year for services as CEO, annual compensation of $52,000 per year for services as CFO, 500,000 options to the CEO and 400,000 options to the CFO in addition to the 7,500,000 restricted shares to each the CEO and CFO.

During the first quarter of 2016, the Company granted a total of 900,000 options for the purchase of up to 900,000 shares of common stock to Tim Vance, the Company's CEO, in connection with the execution of a new 5 year employment agreement and to Gary Woerz, the Company's newly designated CFO, in connection with the execution of a new 5 year employment agreement. The Company uses the Black-Scholes option valuation model to value stock options granted. The Black- Scholes model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. The model requires management to make estimates, which are subjective and may not be representative of actual results. The Company recorded $363 (June 30, 2015: $Nil) in stock option compensation expense, in relation to these options for the six month period ended June 30, 2016. The Black-Scholes model calculations included stock price on date of measurement of $0.0014, exercise price of $0.001, a term of 3 years, computed volatility of 105% and a discount rate of 1.01%. The January 2016 employment agreements calls for a 5 year term ending January 30, 2018, annual compensation of $85,000 per year for services as CEO, annual compensation of $52,000 per year for services as CFO, 500,000 options to the CEO and 400,000 options to the CFO in addition to the 7,500,000 restricted shares to each the CEO and CFO.

The Company issued a total of twelve million (12,000,000 restricted shares) of the Company's common stock as follows: six million restricted shares in the name of Timothy E. Vance and six million restricted shares in the name of Gary D. Woerz valued at $0.0038 based upon services provided by the Executive officers in improving the Company's financial condition and operations and the shares will be subject to a holding period of eighteen months prior to their availability for resale pursuant to the provisions of Rule 144, and the Company determined that the Employment Agreements between the Company and its Executive Officers be amended to adjust the exercise price form the lower of $0.03 to $0.0015 and that the expiration date of the options to be extended from January 31, 2018 to December 31, 2019. The company expensed $7,600 for the quarter ending June 30, 2016 and $7,600 for the quarter ending June 30, 2015. The company expensed $15,200 for the six month period ended June 30, 2016 and $15,200 for the six month period ended June 30, 2015. The total value of the 12,000,000 shares granted is $45,600.

During 2009, the Company received cash in the sum of $50,000 from a shareholder for a Convertible Note Payable at a 10% interest rate. On July 30, 2015, the Company entered into an amendment agreement for the previously convertible note. The amendment removed the prior conversion feature of the note and amended the due date to June 30, 2016. The remaining balance of the note as of June 30, 2016 and December 31, 2015 was $29,546 and $33,064, respectively. The interest for the note payable has been calculated annually and has been paid for the quarter ended June 30, 2016 and the year ended December 31, 2015.

As of June 30, 2016 and December 31, 2015, convertible notes payable to related party had a balance of $10,000. The note is past due and considered in default. The interest for the note payable has been calculated annually and has been accrued for the quarter ended June 30, 2016 and the year ended December 31, 2015.

As of June 30, 2016 and December 31, 2015, the total due to management for past accrued salaries is $1,800 and $42, respectively.

As of June 30, 2016 and December 31, 2015, the total due to management included in accounts payable is $6,037 and $3,767, respectively.

During the six month periods ended June 30, 2016 and June 30, 2015, the company repaid a total of $3,518 and $3,519, respectively, to related parties on various note payables.

(3) Capital Stock, Warrants and Options

The Company is authorized to issue up to 10,000,000 shares of Preferred Stock, $0.001 par value per share, of which 800,000 shares of Series A convertible preferred stock are outstanding at June 30, 2016 and December 31, 2015. The Preferred Stock may be issued in one or more series, the terms of which may be determined at the time of issuance by the Board of Directors, without further action by stockholders, and may include voting rights (including the right to vote as a series on particular matters), preferences as to dividends and liquidation, conversion, redemption rights and sinking fund provisions.

Each share of Series A Preferred Stock shall bear a preferential dividend of twelve percent (12%) per year and is convertible into a number shares of the Company's common stock, par value $0.001 per share ("Common Stock") based upon Fifty (50%) percent of the average closing bid price of the Common Stock During the ten (10) day period prior to the conversion. The Company has not declared or accrued any dividends and as of June 30, 2016 or December 31, 2015. Unaccrued and undeclared dividends were $2,400 and $4,800 as of June 30, 2016 and December 31, 2015, respectively.

During the quarter ended September 30, 2014 the Company amended its Articles of incorporation to authorize 1,000,000 shares of Series B Preferred Stock at a par value of $0.001 and issued 10,000 shares. The Series B shares were valued at $76,000 and were expensed during 2014. The Series B Preferred Stock may be issued to one or series by the terms of which may be and may include preferences as to dividends and liquidation, conversion, redemption rights and sinking fund provisions. The Series B Preferred Shares have the right to vote in the aggregate, on all shareholder matters votes equal to 51% of the total shareholder vote on any and all shareholder matters. The Series B Preferred Stock will be entitled to this 51% voting right no matter how many shares of common stock or other voting stock of Data Call Technology stock is issued and outstanding in the future.

During the first quarter of 2016, the Company granted a total of 900,000 options for the purchase of up to 900,000 shares of common stock to Tim Vance, the Company's CEO, in connection with the execution of a new 5 year employment agreement and to Gary Woerz, the Company's newly designated CFO, in connection with the execution of a new 5 year employment agreement. The Company uses the Black-Scholes option valuation model to value stock options granted. During the period ended March 31, 2015, the Company determined that the Employment Agreements between the Company and its Executive Officers be amended to adjust the exercise price form the lower of $0.03 to $0.0015 and that the expiration date of the options to be extended from January 31, 2018 to December 31, 2019. The Black- Scholes model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. The model requires management to make estimates, which are subjective and may not be representative of actual results. The Black-Scholes model calculations included stock price on date of measurement of $0.0014, exercise price of $0.001, a term of 3 years, computed volatility of 105% and a discount rate of 1.01%. Assumptions used to determine the fair value of the stock based compensation is as follows:

Exercise price	Total Options Outstanding	Weighted Average Remaining Life (Years)	Total Weighted Average Exercise Price	Options Exercisable
$0.001	900,000	2.69	$0.001	900,000

The Company recorded $363 (June 30, 2015: $Nil) in stock option compensation expense, in relation to these options for the six month period ended June 30, 2016. Total stock option compensation expense is calculated at $884.

During the first quarter of 2015, the Company granted a total of 900,000 options for the purchase of up to 900,000 shares of common stock to Tim Vance, the Company's CEO, in connection with the 2013 5 year employment agreement and to Gary Woerz, CFO, in connection with the execution of the 2013 5 year employment agreement. The Company uses the Black-Scholes option valuation model to value stock options granted. During the period ended March 31, 2015, the Company determined that the Employment Agreements between the Company and its Executive Officers be amended to adjust the exercise price form the lower of $0.03 to $0.0015 and that the expiration date of the options to be extended from January 31, 2018 to December 31, 2019. The change in value from the lower exercise price and extended expiration date was considered immaterial. The Black- Scholes model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. The model requires management to make estimates, which are subjective and may not be representative of actual results. The Black-Scholes model calculations included stock price on date of measurement of $0.0036, exercise price of $0.001, a term of 1.5 years, computed volatility of 251% and a discount rate of 0.33%. Assumptions used to determine the fair value of the stock based compensation is as follows:

Exercise price	Total Options Outstanding	Weighted Average Remaining Life (Years)	Total Weighted Average Exercise Price	Options Exercisable
$0.001	900,000	1.07	$0.001	900,000

The Company recorded $266 (June 30, 2015: $1,241) in stock option compensation expense, in relation to these options for the six month period ended June 30, 2016. Total stock option compensation expense is calculated at $3,039.

During the first quarter of 2014, the Company granted a total of 900,000 options for the purchase of up to 900,000 shares of common stock to Tim Vance, the Company's CEO, in connection with the 2013 5 year employment agreement and to Gary Woerz, CFO, in connection with the execution of the 2013 5 year employment agreement. The Company uses the Black-Scholes option valuation model to value stock options granted. During the period ended March 31, 2015, the Company determined that the Employment Agreements between the Company and its Executive Officers be amended to adjust the exercise price form the lower of $0.03 to $0.0015 and that the expiration date of the options to be extended from January 31, 2018 to December 31, 2019. The change in value from the lower exercise price and extended expiration date was considered immaterial. The Black- Scholes model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. The model requires management to make estimates, which are subjective and may not be representative of actual results. The Black-Scholes model calculations included stock price on date of measurement of $0.003, exercise price of $0.001, a term of 1.5 years, computed volatility of 256% and a discount rate of 0.34%. Assumptions used to determine the fair value of the stock based compensation is as follows:

Exercise price	Total Options Outstanding	Weighted Average Remaining Life (Years)	Total Weighted Average Exercise Price	Options Exercisable
$0.001	900,000	0.89	$0.001	900,000

The Company recorded $Nil (June 30, 2015: $524) in stock option compensation expense, in relation to these options for the six month period ended June 30, 2016. Total stock option compensation expense is calculated at $2,877.

The Company is authorized to issue up to 200,000,000 shares of Common Stock of which 144,976,421 are issued and outstanding at June 30, 2016 and December 31, 2015.

(4) Property and Equipment

Major classes of property and equipment together with their estimated useful lives, consisted of the following:

	Years		June 30, 2016		December 31, 2015
Equipment	3-5	$	96,236	$	96,236
Office furniture	7		21,681		21,681
Leasehold improvements	3		10,656		10,656
			128,573		128,573
Less accumulated depreciation and amortization			126,706		126,364
Net property and equipment		$	1,867	$	2,209

(5) Shareholder Notes Payable

Repayments on shareholder notes payable during the six month period ended June 30, 2016 totaled $3,518 (2015: $3,519).

(6) Subsequent Events and Contingencies

The Company has evaluated subsequent events from the date on the balance sheet through the date these financial statements are being filed with the Securities and Exchange Commission. No material events or transactions have occurred during this subsequent event reporting period which required recognition or disclosure in the financial statements.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS AND RESULTS OF OPERATION Back to Table of Contents

Some of the statements contained in this quarterly report of Data Call Technologies, Inc., Nevada corporation (hereinafter referred to as "we", "us", "our", "Company" and the "Registrant") discuss future expectations, contain projections of our plan of operation or financial condition or state other forward-looking information. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. They use of words such as "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. From time to time, we also may provide forward-looking statements in other materials we release to the public.

Data Call Technologies, Inc. ("Data Call," or the "Company") was incorporated under the laws of the State of Nevada as Data Call Wireless on April 4, 2002. On March 1, 2006, we changed our name to Data Call Technologies, Inc.

Our mission is to integrate cutting-edge information/content delivery solutions currently deployed by the media and make this content rapidly available to and within the control of our retail and commercial clients. The Company's software and services put its clients in control of real-time, news, and other content, including emergency alerts, displayed within one building to thousands of local, regional, and national clients, through Digital Signage and Kiosk networks.

Our business plan is to focus on growing our client base by continued offering of real-time information/content, seeking to continually improve the delivery, security, and variety of information/content to the Digital Signage and Kiosk community.

Overview

What Is Digital Signage?

LED and LCD displays are continually replacing printed marketing materials such as signs and placards, as well as the old-fashioned whiteboard, for product and corporate branding, marketing and assisted selling. The appeal of instantly updating product videos and promotional messages on one or a thousand remotely located displays is driving the adoption of this exciting marketing tool. Digital Signage presentations are typically comprised of repeating loops of information used to brand, market or sell the owner's products and services. But once viewed, this information becomes repetitive and the viewer tunes it out, resulting in low retention of the client's message. As digital signage "comes of age," the dynamic characteristics of the digital signage presentations has taken center-stage requiring fresh, relevant and updated dynamic content.

Digital Signage Comes of Age

We believe that the Digital Signage industry is "coming of age" and that Data Call through multiple industry relationships has been engaged in the business for more than a decade. Our company has virtually been there from the start and is in in a prime position to enjoy and benefit from our industry's growth. A few short years ago, a business wanting to derive commercial benefit from use of digital signage was often confronted with a myriad of hardware and software companies, all offering their own version of what digital signage should be. Typical customers for digital signage were most-often offered the hardware for digital signage but without the full package of content with which to build and tailor their systems for their target customer base.

Those early digital signage customers often had to deal with the fact that their digital signage hardware vendors lacked the know-how to provide them with the "do's and don'ts" of content development. However, from our inception, Data Call recognized that our competitors and their typical customers lacked a key component which includes the offering of a comprehensive content package.

Recently, as the cost of platforms supporting content management infrastructure and displays have fallen significantly, digital signage has become more accessible to a wider range of potential users while the growing Kiosk market has cross-pollinated with Digital Signage. Companies in our industry have come to understand as we have understood almost since our inception in 2002, that the benefit that Data Call provides to our customers, in the form of ongoing content development (dynamic content) is expected to continue to provide our customers with desirable services. Content needs to stay fresh. Data Call has automated this process for their subscribers. As the cost of deployment has decreased, Data Call has continued to focus, as well as other providers have only begun focusing, on offering "attention-grabbing content" as a means of drawing target customers' attention to the core message of clients, thereby keeping their target customers engaged throughout Digital Signage and Kiosk presentations.

The Need for Speed-Active Content

Active and dynamic content is the integral part of digital signage presentations that must be constantly updated with timely and relevant information in order to attract and retain target customers to the product and service offered by clients. For instance, a typical presentation may contain ten 15-second loops that provide the primary message of the presentation, but the active dynamic content, such as that provided by Data Call, is updated with new information throughout the day. Those seeking to add active and dynamic content to their digital signage presentations are advised to employ Data Call's integrated content rather than attempting to "cut and paste" broadcast content of others into their digital signage presentation.

Our clients, by integrating Data Call's active content as a meaningful component of their digital signage presentations, can provide the entertainment and information content necessary to enhance the target customer's information retention without disrupting the core message of the presentation. Information categories provided by Data Call include news, weather, sports, financial data and the latest traffic alerts, among others. With such a broad range of offerings, our clients have access to the active and dynamic content they need, regardless of the target customers and market they are addressing.

Our Business Opportunities

Our many opportunities for client development in the digital signage industry are growing virtually exponentially. While many companies in our industry have traditionally outsourced all or part of their content creation, Data Call serves as a provider of dynamic active content to clients on a tailored basis. Whether a client desires general entertainment information for customers, such as news, sports, stock market quotes, etc. or location-specific content, such as local weather, traffic, product sales and specials, etc., our research has validated our long-held assumption that dynamic content draws and retains our clients' target viewers to their digital signage and keeps them engaged throughout the presentation.

Since our inception, management has developed strong relationships working with the leaders in digital signage. Collaborative efforts successfully created the data formats and means of communication to facilitate the delivery of our dynamic content more easily and efficiently by our clients for integration into their hardware and software products, setting industry standards.

Partners, Not Customers

Data Call's approach to our clients is to build long-lasting partnerships by creating client relationships that we believe are unique in the digital signage industry. We do this because we understand that each client has its own content requirement. In developing dynamic content for individual digital signage clients, we have identified three content-related factors: (i) reliability; (ii) objectivity; and (iii) ease of implementation. To address the reliability requirement, we have elected to enter into license arrangements with the leading providers of news, weather, sports and financial information, among other client-desired content rather than either: (i) downloading and repackaging content sourced from the Internet (which may be illegal); or (ii) pulling RSS feeds (which may come and go at the provider's whim). Licensing data from these premier providers has also served us by satisfying the second criteria, objectivity. Because it is commonly recognized that Internet content may often be unreliable, unverifiable and biased, we have determined that we could not simply use unfiltered Internet content for delivery to our clients. To achieve ease of implementation, our licensing of data facilitates the ease of delivery to and implementation and use by our client/partners. Data Call has understood that it's Digital Signage and Kiosk clients needed more complete service than to endeavor the sourcing of active content from multiple vendors. As a result, our flexible content packages permit our clients to do "one stop shopping" for all of their dynamic content requirements by a single sublicense from us. Ease of implementation also would require that the multiple formats of all Data Call's data providers be distilled into a single, usable format.

We enable our clients to receive customized dynamic content which may be displayed in a multitude of ways (banners, tickers, scrolls or artistically integrated with the overall presentations). We have created and produced multiple sets of common data layouts in the industry-standard XML (extensible markup language) format inclusive of MRSS. With the advent of HTML5, even more delivery methods have been made available to our clients, many of whom have found these new formats to be easily integrated into their products. Nevertheless, we have also produced customized data formats to the exact and specific requirements of our clients/partners, which, we believe ensures a higher level of reliability and ease of integration.

Market demand, opportunity and technology converge at a single point in time, and Data Call is there. Our integrity continues to build our business. Digital signage platforms are evolving to meet mass market requirements, costs for hardware and software are falling to the point of becoming commodities and the markets for digital signage are clarifying through historical trial and error.

Business Operations

In August of 2013, we announced the release of our Direct Lynk Media (DLMedia) product. The DLMedia product encapsulates the Direct Lynk Messenger product with major enhancements and options that allow the client to select and include in their feed images relative to the news feeds. Also in the release, both Weather and Traffic image products have been enhanced considerably. Other additions included within the release bring more value to the company's clients and create more interest from new and existing clients.

The current types of data and information, for which a client is able to subscribe to through the Direct Lynk System include:

-	Headline News top world and national news headlines;
-	Business News top business headlines;
-	Financial Highlights world-based financial indicators ;
-	Entertainment News top entertainment headlines;
-	Health/Science News top science/health headlines;
-	Quirky News Bits latest off-beat news headlines;
-	Sports Headlines top sports headlines
-	Latest Sports Lines - latest sports odds for NFL, NBA, NHL, NCAA Football and NCAA Basketball;
-	National Football League latest game schedule and in-game updates;
-	National Basketball Association - latest game schedule and in-game updates;
-	Major League Baseball - latest game schedule and in-game updates;
-	National Hockey League - latest game schedule and in-game updates;
-	NCAA Football - latest game schedule and in-game updates;
-	NCAA Men's Basketball - latest game schedule and in-game updates;
-	Professional Golf Association top 10 leaders continuously updated throughout the four-day tournament;
-	NASCAR top 10 race positions updated every 20 laps throughout the race;
-	Major league soccer;
-	Traffic Mapping;
-	Animated Doppler Radar and Forecast Maps;
-	Listings of the day's horoscopes;
-	Listings of the birthdays of famous persons born on each day;
-	Amber alerts;
-	Listings of historical events which occurred on each day in history; and
-	Localized Traffic and Weather Forecasts.

We currently offer our Direct Lynk Messenger and DLMedia services to our clients and other potential customers through the Internet. Both DLM Services are Digital Signage products and real-time information services which provides a wide range of up-to-date information for display. Both DLM services are able to work concurrently with customers' existing digital signage systems. The Direct Lynk Messenger product is slowly becoming a legacy product with the DLMedia product in the forefront.

The Digital Signage and Kiosk industry is still a relatively new and since our inception in 2002 we have come to understand that it provides an exciting method for advertisers, including our clients, to promote, inform, educate, and entertain their customers regarding their business products and services. Through Digital Signage, businesses can use a single display or a complex, networked series of flat screen LED, LCD and even combined as video walls as display devices to market their products and services directly at their facilities and elsewhere to their customers and patrons in real time. Additionally, because Digital Signage advertising takes place in real time, businesses can change their marketing efforts literally from moment to moment and over the course of a day or such other period as they may determine.

We believe that the ability of our clients to display in real-time the information and content we deliver better allows our clients companies to tailor their products, services and advertising to individual and target-group customers, thereby advertising and offering, for example, inventory and sales discounts that may be designed to appeal to those individual customers and target customer groups, increasing sales and revenues. We believe that the benefits of on-site, real-time Digital Signage displays compared to regular print or video advertising are substantial and include, among other advantages, being able to immediately change digitally-displayed images/advertisements depending on our client's customers own situation, not simply being restricted by in-store print circulars produced days, weeks or even months in advance, which may become stale or obsolete prior to or shortly after publication and dissemination.

We specialize in allowing clients to create their own Digital Signage dynamic content feeds which are delivered online directly to their chosen, electronic digital display devices at their various facilities. The only requirements our clients must have are: (i) a supported, third-party Digital Signage and/or Kiosk equipment solution, or similar device, which receives the data from our servers online; and (ii) an Internet connection. Our Direct Lynk System is supported by various, readily available third-party systems, varying in costs from inexpensive monthly cloud-based licenses to much more extensive and expensive content management/playback systems. Our Direct Lynk Systems allow customers to select from the pre-determined data and information subscriptions of those described above. We enable our clients to also select location specific content they wish to receive based on how and where their Digital Signage network is configured.

During the first quarter of fiscal 2014, we released our "Playlist-Ready" content products, enhancing our ability to further accommodate our current clients and appease new prospects. One product within the "Above the Fold" line has received a high level of acceptance at the industry trade shows, most recently at the Digital Signage Expo held in Las Vegas in March 2016. All of our products and services can be viewed on our website: datacalltech.com.

Results of Operations

The following discussion should be read in conjunction with our financial statements.

During the last twelve months, the Company has implemented cost management measurements to review monthly expenditures. We will continue these efforts to streamline operations, as we focus on increasing sales and gross revenues over the next twelve months. We do not currently have any plans to increase our monthly expenditures or number of employees. We currently offer our Direct Lynk Messenger and DLMedia services to our clients and other potential customers through the Internet. Both DLM Services are Digital Signage products and real-time information services which provides a wide range of up-to-date information for display. Both DLM services are able to work concurrently with customers' existing digital signage systems. The Direct Lynk Messenger product is slowly becoming a legacy product with the DLMedia product in the forefront.

We continually add subscribers for our technology throughout and intend to build and increase such subscribers moving forward.

Three Months Ended June 30, 2016 Compared to Three Months Ended June 30, 2015

Our revenues for the three months ended June 30, 2016 were $159,410, compared to $142,581 for the three-month period ended June 30, 2015, representing an increase of $16,829 or approximately 11.8%. The increase in revenues was mainly due to additional sales and marketing efforts.

Costs of sales for the three months ended June 30, 2016 were $35,406 compared to $35,493 for the three-month period ended June 30, 2015, cost of sales for the quarter were basically flat. These costs are related to the licensing and royalty expense required to provide enhanced subscription services.

Gross margins for the three months ended June 30, 2016 were $124,004 compared to $107,088 as of June 30, 2015, or 77.8% for the three-month period ended June 30, 2016 as compared to 75.1% for the three month period ending June 30, 2015.

Selling, General and Administrative expenses for the three months ended June 30, 2016 were $161,618 compared to $155,984 for the three-month period ended June 30, 2015, representing an increase of $5,634 from the same period in the prior year. The increase in SG&A expenses is mainly due to an increase in personnel. Net loss for the three months ended June 30, 2016 was $39,149 compared to a net loss of $50,682 for the three-month period ended June 30, 2015. The Company's net loss was significantly lower for the second quarter of 2016 due to increased operational efficiencies and the increase in new sales. The Company has calculated that net income from operations for the second quarter of 2016 would have been $12,989 if the non-cash items (expense for stock for services and options which totaled $52,138) were added back to the current net loss.

Six months Ended June 30, 2016 Compared to Six months Ended June 30, 2015

Our revenues for the six months ended June 30, 2016 were $327,196, compared to $304,548 for the six-month period ended June 30, 2015, representing an increase of $22,648 or approximately 7.4%. The increase in revenues was mainly due to additional sales and marketing efforts.

Costs of sales for the six months ended June 30, 2016 were $77,452, compared to $70,138 for the same period of the prior year. This increase was due the costs related to the licensing and royalty expense required to provide the subscription services and the additional cost associated with the increase in revenue.

Gross margins for the six months ended June 30, 2016 were $249,744 compared to $234,410 as of June 30, 2015, or 76.3% for the six month period ended June 30, 2016 as compared to 77.0% for the six month period ending June 30, 2015.

Selling, General and Administrative expenses for the six months ended June 30, 2016 were $354,181 compared to $357,955 for the six month period ended June 30, 2015, representing a decrease of $3,774 from the same period in the prior year. The decrease in SG&A expenses is mainly due to managements ongoing efforts to increase operational efficiencies. Net loss for the six months ended June 30, 2016 was $106,352 compared to a net loss of $127,317 for the six month period ended June 30, 2015. The Company's net loss was significantly lower for the second quarter of 2016 due to increased operational efficiencies and the increase in new sales. The Company has calculated that net loss from operations for the six month period ended June 30, 2016 would have been $1,887 if the non-cash items (expense for stock for services and options which totaled $104,465) were added back to the current net loss.

Liquidity and Capital Resources

As of June 30, 2016, we had total current assets of $152,082, consisting of $72,292 in cash, $71,790 in accounts receivable and $8,000 in prepaid expenses and had total current liabilities of $90,955 consisting or $26,603 in accounts payable, $23,791 in accrued expenses, $1,015 in deferred revenues and $39,546 in short-term notes payable and convertible notes payable.

At June 30, 2016, we had a positive working capital of $61,127 and an accumulated deficit since inception of $9,663,547.

We had net cash used by operating activities of $10,000 during the six-month period ended June 30, 2016, which was mainly due to a net loss of $106,352, stock for services and options expense of $104,465, a decrease in accounts receivable of $14,944, offset by an increase in accounts payable of $4,153, an increase in accrued expenses of $2,008, depreciation expense of $342 and a decrease in deferred revenue of $3,042.

We had no investing activities during the six-month period ended June 30, 2016. We used $3,518 in our financing activities during the six months ended June 30, 2016 for the repayment of a shareholder notes payable.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Back to Table of Contents

A smaller reporting company, as defined by Item 10 of Regulation S-K, is not required to provide the information required by this item.

ITEM 4. CONTROLS AND PROCEDURES Back to Table of Contents

Evaluation of disclosure controls and procedures.

As of June 30, 2016, the Company's chief executive officer and chief financial officer conducted an evaluation regarding the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act. Based upon the evaluation of these controls and procedures, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this report. Management has identified corrective actions for the weakness and has begun implementation during the fourth quarter of 2016.

Changes in internal controls.

During the quarterly period covered by this report, no changes occurred in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS Back to Table of Contents

None.

ITEM 1A. RISK FACTORS Back to Table of Contents

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, "Item 1. Description of Business, subheading Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2015, which could materially affect our business, financial condition or future results. The risks described in our Annual Report on Form 10-K is not the only risks facing our company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS Back to Table of Contents

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES Back to Table of Contents

None.

ITEM 4. MINE SAFETY DISCLOSURE Back to Table of Contents

None.

ITEM 5. OTHER INFORMATION Back to Table of Contents

None.

ITEM 6. EXHIBITS Back to Table of Contents

(a) The following documents are filed as exhibits to this report on Form 10-Q or incorporated by reference herein. Any document incorporated by reference is identified by a parenthetical reference to the SEC filing that included such document.

Exhibit No.	Description
31.1	Certification of CEO pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of CFO pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of CEO pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of CFO pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned.

DATA CALL TECHNOLOGIES INC.

By: /s/ Timothy E. Vance
Timothy E. Vance
Chief Executive Officer and Chairman
(Principal Executive Officer)
Date: August 15, 2016

By: /s/ Gary Woerz
Gary Woerz
Chief Financial Officer
(Principal Financial and Principal Accounting Officer)
Date: August 15, 2016

Pursuant to the requirements of the Securities Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By: /s/ Timothy E. Vance
Timothy E. Vance
Chairman
(Principal Executive Officer)
Date: August 15, 2016

By: /s/ John Schafer
Director
Date: August 15, 2016