SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): Ferbruary 12, 2020
iQSTEL Inc.
(Exact name of registrant as specified in its charter)
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Nevada |
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000-55984 |
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45-2808620 |
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(State or other jurisdiction of incorporation) |
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(Commission File Number) |
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(I.R.S. Employer Identification No.) |
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300 Aragon Avenue, Suite 375 Coral Gables, FL 33134 |
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33134 |
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(Address of principal executive offices) |
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(Zip Code) |
Registrant’s telephone number, including area code: (954) 951-8191
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
SECTION 1 - REGISTRANT'S BUSINESS AND OPERATIONS
ITEM 1.01 - ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On February 12, 2020, we entered into a Memorandum of Understanding and Shareholders Agreement with Jesus Vega and our officer and director, Leandro Iglesias. The agreement concerns the formation of a joint venture named QGLOBAL SMS, LLC for the development of the wholesale SMS business.
Under the agreement, Mr. Vega will contribute to the joint venture by developing the international SMS business in the areas of wholesale and retail (person to person (PSP) and application to person (A2P)) as well as the sale of such services internationally. Mr. Vega will also contribute the entire volume of sales in the SMS business that he has in a company that he owns. He will assign all contracts with suppliers and customers, the lease contract for the Interconnection platform, as well as the personnel currently working in the aforementioned company. His current business has a monthly sales volume as of the end of January 2020 of $50,000.
Once QGLOBAL SMS, LLC reaches monthly sales of $50,000 for three consecutive months, provided the percentage of gross monthly margin is maintained above 12%, we are committed to invest $50,000 to prepay SMS providers, and an additional $200,000 to be used to pay SMS providers based on the amount of sales reached. We have also agreed to transfer the interconnection agreements for SMS signed by our subsidiary, Etelix.com USA, LLC, within 30 days of execution of the joint venture.
Mr. Iglesias has agreed to transfer to us his 50% interest in the already formed QGLOBAL SMS, LLC. Mr. Vega will transfer 1% of his interest for a total of 51% to us and 49% to Mr. Vega. QGLOBAL SMS, LLC will have 4 board members, which will include Mr. Iglesias, Italo Segnini, Mr. Vega and our CFO, Alvaro Quintana.
Mr. Vega will be entitled to a salary of $3,500 per month and bonuses as set forth in the agreement to be paid in shares of our common stock at a value of $1.30 per share.
We have been granted an option to purchase Mr. Vega’s interest in the joint venture after 18 months.
The foregoing description of the agreement is not complete and is qualified in its entirety by reference to the text of such document, which is filed as Exhibit 2.1 hereto and which is incorporated herein by reference.
SECTION 2 - FINANCIAL INFORMATION
ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS.
The disclosures set forth in Item 1.01 above are incorporated by reference into this Item 2.01.
SECTION 8 – OTHER EVENTS
ITEM 8.01 - OTHER EVENTS
On February 12, 2020, we issued a press release concerning the joint venture. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.
The information in Item 8.01 of this Current Report on Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.
SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01 - FINANCIAL STATEMENTS AND EXHIBITS.
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Exhibit No. |
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Description |
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Memorandum of Understanding and Shareholders Agreement, dated February 12, 2020 |
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Press Release, dated February 12, 2020 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
iQSTEL Inc.
/s/ Leandro Iglesias
Leandro Iglesias
Chief Executive Officer
Date February 19, 2020
iQSTEL, Inc. Executes Acquisition of Revenue Generating SMS-Carrier Assets; Forms New JV for SMS Business for Wholesale Carrier and Corporate Solutions
NEW YORK, NY -- (Marketwired) – 2/12/2020 - iQSTEL Inc. (OTC: IQST) today announced the execution of an acquisition agreement for an SMS Business. A new 51% owned JV is being created for this business acquisition.
The SMS market is primarily made up of 3 areas: App-to-Person (A2P), Person-to-Person (P2P) and cloud-based services for corporate clients. The global market sees 5 billion people using SMS messaging according to SlickText. By 2025 that number is expected to hit 6 billion with the driving force of 5G deployment. China, USA, Japan and most of Europe are the dominant markets with Latin America close behind.
Mr. Iglesias, the Company’s CEO stated: “With this acquisition, iQSTEL now has the IT and carrier agreements to officially launch its SMS business. The acquisition is inclusive of current carrier contracts that currently generate approximately $600,000 per year, thus will be accretive to revenue from day 1. We expect that this additional technology will be cross-sold with iQSTEL’s current carrier base, and increased inventory, allowing for a projected annual revenue rate of $6 million within 9-12 months. The name of the new company will be QGlobal SMS.”
“The SMS market as a whole provides for an increased margin over VOIP services, thereby potentially providing for a strong return to the company. A2P (App-to-Person) continues to grow as this is the two factor authentication service that many people and companies (Microsoft, Facebook, banks, etc) are now using in addition to username/passwords. Security is an important component to the global economy and this acquisition allows iQSTEL Inc. (OTC: IQST) to not only benefit revenue wise, but to bring this added security layer to Latin America and other countries,” concluded Mr. Iglesias, the Company’s CEO.
Companies are shifting their communications from phone/voice and email to SMS as statistics show the majority of people prefer SMS over phone or email contact, in addition to responding faster. An added benefit is all phones support SMS for two factor authentication (A2P) bypassing any app compatibility issues. The A2P market is currently on the rise as seen in the MobileSquared chart.
About iQSTEL Inc.:
iQSTEL (OTC: IQST) www.iQSTEL.com is a technology company offering a wide array of services to the Telecommunications Industry. These include services to International Long-Distance Telecommunications Operators (ILD Wholesale), Retail and Corporate markets (ILD Retail), Submarine Fiber Optic Network capacity, Satellite Communications services, Mobile Virtual Network Operator (MVNO) services, Internet of Things (IoT) technology solutions, Data Center facilities capacity leasing, and Blockchain solutions for the Telecommunications industry.
About Etelix.com USA, LLC:
Etelix.com USA LLC www.etelix.com is wholly owned subsidiary of iQSTEL Inc. Etelix.com USA, LLC is a Miami, Florida-based international telecom carrier founded in 2008 that provides telecom and technology solutions worldwide, with commercial presence in North America, Latin America and Europe. Enabled by its 214-license granted by the Federal Communications Commission (FCC), Etelix provides International Long-Distance voice services for Telecommunications Operators (ILD Wholesale), and Submarine Fiber Optic Network capacity for internet (4G and 5G). Etelix was founded in 2008 and has been profitable since inception.
About SwissLink Carrier AG:
SwissLink Carrier AG www.swisslink-carrier.com is a 51% owned subsidiary of iQSTEL Inc. SwissLink Carrier AG is a Switzerland based international Telecommunications Carrier founded in 2015 providing international VoIP connectivity worldwide, with commercial presence in Europe, CIS and Latin America. SwissLink Carrier AG is a Swiss licensed Operator, having a domestic Interconnect with Swisscom, allowing their international Carrier Customers direct terminations via SwissLink into all Switzerland Fix & Mobile Networks. Since the takeover from Swissphone in November 2018 and the rename into SwissLink, they operate on a profitable level.
Safe Harbor Statement: Statements in this news release may be "forward-looking statements". Forward-looking statements include, but are not limited to, statements that express our intentions, beliefs, expectations, strategies, predictions or any other statements relating to our future activities or other future events or conditions. These statements are based on current expectations, estimates and projections about our business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may, and are likely to, differ materially from what is expressed or forecasted in forward-looking statements due to numerous factors. Any forward-looking statements speak only as of the date of this news release and iQSTEL Inc. undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this news release.
iQSTEL Inc.
IR US Phone: 646-740-0907, IR Email: investors@iqstel.com
Source: iQSTEL Inc.
www.iqstel.com ; www.swisslink-carrier.com and www.etelix.com
