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As Of Filer Filing For·On·As Docs:Size Issuer Filing Agent 4/14/23 iQSTEL Inc. 10-K 12/31/22 72:5.9M Edgar Einsteins, Inc./FA |
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
| i ☒ | ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| For the fiscal year ended i December 31, 2022 | |
| i ☐ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| For the transition period from _________ to ________ | |
| Commission file number: i 000-55984 |
| i IQSTEL Inc. | |
| (Exact name of registrant as specified in its charter) | |
| i Nevada | i 45-2808620 |
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.) |
|
i 300 Aragon Avenue, i Suite 375 i Coral Gables, i FL |
i 33134 |
| (Address of principal executive offices) | (Zip Code) |
|
Registrant’s telephone number: ( i 954) i 951-8191
|
|
| Securities registered under Section 12(b) of the Exchange Act: | |
| Title of each class | Name of each exchange on which registered |
| none | not applicable |
|
Securities registered under Section 12(g) of the Exchange Act:
| |
| Title of each class | |
| Common Stock, par value of $0.001 | |
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] i No [X]
Indicate by checkmark 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. i Yes [X] No [ ]
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). i Yes [X] No [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company.
| ☐ Large accelerated filer | ☐ Accelerated filer |
| ☒ i Non-accelerated Filer | i ☒ Smaller reporting company |
| i ☐ 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. [ ]
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. [ ]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter $57,089,985.82.
Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date common shares as of April 10, 2023.
|
PART IV
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| Item 15. | Exhibits, Financial Statement Schedules | 29 |
| Item 16. | Form 10-K Summary | 29 |
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PART I
Forward-Looking Statements
This Annual Report on Form 10-K contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements.” These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on our operations and future prospects on a consolidated basis include but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.
Company Description
iQSTEL Inc. (the “Company”) (OTC Pink: IQST) (www.iqstel.com) is a technology company offering a wide array of services to global telecommunications and technology industries with presence in 13 countries.
The Company has an extensive portfolio of products and services for its clients such as: SMS, VoIP, 4G & 5G international infrastructure connectivity, Cloud-PBX, OmniChannel Marketing, IoT services, blockchain and payment solutions. These services are grouped within four business divisions: Telecom, Fintech, Electric vehicles and Metaverse
The company operates its business through its wholly-owned subsidiary Etelix.com USA, LLC (“Etelix”) (www.etelix.com); and its majority-owned subsidiaries SwissLink Carrier AG (www.swisslink-carrier.com), QGlobal SMS (https://www.qglobalsms.com/), Smart Gas (http://iotsmartgas.com/) and ItsBChain (http://itsbchain.com/), Whisl Telecom LLC (www.whisl.com), and Smartbiz Telecom LLC (www.smartbiztel.com). The information contained on our websites is not incorporated by reference into this Annual Report, and such information should not be considered to be part of this Annual Report.
History
iQSTEL, formerly known as PureSnax International, Inc., was incorporated under the laws of the State of Nevada on June 24, 2011. PureSnax was previously a wellness brand focused on bringing healthy snacks and foods to consumers. On March 8, 2017, PureSnax exited a previous License Agreement with a Canadian snack food Licensor. From March of 2017 until its acquisition of Etelix.com USA, LLC, PureSnax was working to develop its own brand and its own products for manufacture, distribution, sales and marketing of various products within the health foods and snacks industry and to pursue related business opportunities. PureSnax acquired Etelix.com USA, LLC on June 25, 2018. The company left the healthy snacks and foods business to focus on the Telecommunications Business.
On August 30, 2018, PureSnax changed its name to “iQSTEL Inc.” and received a new CUSIP number: 46265G107, as well as a new trading symbol “IQST” in order to better resemble its new name. iQSTEL also changed the Standard Industrial Classification (SIC Code) to 4813, Telephone Communications, Except Radiotelephone.
On April 1, 2019, the Company entered into a Company Purchase Agreement (the “Purchase Agreement”) by and between the Company and the Ralf Kohler (the “Seller”), which agreement provides for the purchase of 51% of the equity and certain assets of SwissLink Carrier AG (“SwissLink”) (www.swisslink-carrier.com), a Swiss corporation, by the Company.
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On February 10, 2020, the Company entered into a Company Acquisition Agreement (the “Agreement”) with Jesus Vega regarding the acquisition of 51% of the shares in QGlobal, LLC (“QGlobal”). QGlobal is a company with the capacity to provide Short Messages (SMS), A2P and P2P messaging services.
On February 21, 2020, the Company entered into a Company Acquisition Agreement (the “Agreement”) with Miguel Scavo regarding the acquisition of 75% of the shares in ItsBchain, LLC (“ItsBchain”) a company specialized in the development of Blockchain applications for telecommunications.
On April 15, 2020, the Company entered into a Company Acquisition Agreement (the “Agreement”) with Francisco Bunt regarding the acquisition of 51% of the shares in loT Labs, LLC (“loT Labs”). The loT Labs’ principal business activity is the sale of SMS between USA and Mexico.
On November 12, 2020, the Company entered into partnership Agreement (the “Agreement”) with PAYMENT VIRTUAL MOBILE SOLUTIONS, LLC (PayVMS), a Delaware Corporation regarding the incorporation of Global Money One Inc, in which iQSTEL owns 75% of the shares and PayVMS owns the remaining 25%. Global Money One is a Fintech company with a complete infrastructure to provide top-up services, international remittances and prepaid debit cards.
On October 1, 2021, the Company entered into an agreement with Jesus Vega regarding the acquisition of the remaining 49% of the shares in QGlobal, LLC (“QGlobal”). By means of this transaction iQSTEL increased its ownership in QGlobal to 100%.
On May 13, 2022, the Company entered into a Company Acquisition Agreement regarding the acquisition of 51% of the shares in Whisl telecom LLC (“Whisl”).
On June 1, 2022, the Company entered into a Company Acquisition Agreement regarding the acquisition of 51% of the shares in Smartbiz Telecom LLC (“Smartbiz”).
Operating Subsidiaries
iQSTEL's mission is to serve basic human needs in today's modern world by making the necessary tools accessible regardless of race, ethnicity, religion, socioeconomic status, or identity. iQSTEL recognizes that in today’s modern world, the pursuit of the human hierarchy of needs (physiological, safety, relationship, esteem, and self-actualization) is marginalized without access to ubiquitous communications, the freedom of virtual banking, clean affordable mobility and information and content. iQSTEL has 4 Business Divisions delivering accessibly to the necessary tools in today's pursuit of basic human needs: 1) Telecommunications (communications). 2) Fintech (financial freedom). 3) Electric Vehicles (mobility). 4) Metaverse. (Information and content). The company continues to grow and expand its suite of products and services both organically and through mergers and acquisitions (M&A).
Our telecommunication business currently represents 100% of our revenues, while our other business lines are in a pre-revenue stage.
Telecom Subsidiaries for voice services:
Etelix.com USA LLC, a wholly owned subsidiary of iQSTEL Inc., is US based international telecom carrier founded in 2008 that provides telecom and technology solutions worldwide, with commercial presence in North America, Latin America, and Europe. Etelix provides International Long-Distance voice services for Telecommunications Operators (ILD Wholesale), and Submarine Fiber Optic Network capacity for internet (4G and 5G).
Etelix is interconnected to the most important players in the industry, with a very strong focus on Asian and Latin-American markets, among which it is worth mentioning: China Telecom, PCCW, Hutchinson Telecom, Vodafone India, KDDI, Airtel, Reliance, Viettel, TATA Communications, Flow Jamaica (Cable and Wireless Caribbean), Cable and Wireless Panama, Millicom (TIGO), Telefonica de España (Movistar), Telecom Italia (TIM), Portugal Telecom (MEU), Optimus (NOS), Belgacom (BICS), Deutsche Telekom, iBasis, Orbitel and Entel.
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An important milestone in the evolution of Etelix was in 2013, when the company become part of a consortium of major carriers for the upgrade of the Maya-1 submarine cable systems that runs from Hollywood, Florida to the city of Tolu in Colombia. This consortium is led by Orange Telecom and Orbitel, where Etelix participates with 10 Gbps of capacity. The bulk of this contract was sold to Millicom (Tigo Costa Rica). This capacity considerably enhanced Tigo’s ability to deploy world-class 4G services to its customers in Costa Rica.
SwissLink Carrier AG 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. The acquisition of Swisslink strengthened the Company’s presence in Europe putting us in a very competitive position to capture traffic to Asian and African countries. Africa continues to be the market with the higher contribution to margin and Asia concentrate one third of the termination traffic in the industry. Estimations show that more than 50% of the traffic terminating in Africa is originated from customers in Europe; while the corresponding percentage of traffic terminated in Asia is close to 40%. Based on these numbers the goal to expand the participation in the Asian and African traffic goes through establishing a strong presence in Europe.
Whisl Telecom LLC. Is a 51% owned subsidiary of iQSTEL Inc., acquired in May 2022. Whisl Telecom is an US based Company that provides high quality services and “out of the box” solutions to its customers. Whisl predominantly serves the Carrier-to-Carrier Global industry but also has network infrastructure to provide services to the retail end users (endpoints). Whisl Telecom is one of the few US carriers to have a significant Tier1 capacity (true capacity with high calls per second, CPS) to terminate calls with the highest quality.
With the acquisition of Whisl Telecom, iQSTEL incorporated to its telecom portfolio the following services: (1) US/Canada Inbound/Origination. (2) US/Canada DIDs. (3) US/Canada Toll Free Numbers. (4) Global DIDs and (5) Global Toll-Free Numbers.
Smartbiz Telecom LLC. Is a 51% owned subsidiary of iQSTEL Inc. acquired in June 2022. Smartbiz is an US based Company that provides international voice termination to niche markets. With this acquisition iQSTEL is expanding its telecommunication services offer to markets the company was not serving before.
With the combination of the technology capabilities of these four subsidiaries, iQSTEL has put together a complete portfolio of services for carriers and end user. These services include:
| • | International Voice Termination for carriers. | |
| • | US/Canada Inbound / Origination. | |
| • | Global DIDs. | |
| • | Global Toll-Free Numbers. | |
| • | PBX (Private Branch Exchange) for small businesses. | |
| • | SIP Trunking. |
The voice services represented in year 2022 42.50% of the total revenue of the company ($39,614,081 out of the total $93,203,532) while in year 2021 voice services represented 31.11% of the total revenue ($20,127,139 out from a total of $64,702,018).
Gross Margin in the voice services increased from 4.72% in year 2021 to 5.81% in year 2022. This is the result of the incorporation to our portfolio of product with higher gross margins. We expect this gross margin to increase in year 2023.
All our subsidiaries carried 2.7 billion minutes of voice during year 2022, compared to 670 million in year 2021. This represents an increase of 268% year over year.
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Telecom Subsidiaries for SMS services:
QGlobal SMS LLC is a 100% owned subsidiary of iQSTEL Inc. QGlobal SMS is a USA based company founded in 2020 specialized in international and domestic SMS termination. QGlobal SMS has commercial presence in Europe, USA and Latin America, with robust international interconnection with Tier-1 SMS Aggregators, guarantying to its customers high quality and low termination rates, in over more than 100 countries.
IoT Labs LLC is a 51% owned subsidiary of iQSTEL Inc. IoT Labs is a SMS service provider based in Austin, TX. Specialized in the SMS traffic exchange between US and Mexico.
The Company has entered into the SMS business in 2020 through the acquisition of QGlobal and IoT Labs. Both companies specialize in international and domestic SMS termination, with emphasis on the Applications to Person (A2P), Person to Person (P2P) and OmniChannel Marketing Services for several markets: Wholesale Carrier, Government, Corporate, Enterprise, Small and Medium Companies.
The Global A2P SMS Market is expected to grow at a CAGR of 4.1% to account for US$ 101 billion in 2030, according to Transparency Market Research. This market has experienced significant growth and adoption rate in the past few years and is expected to experience notable growth and adoption in years to come.
Our SMS services represented in year 2022 57.50% of the total revenue, while it was 68.89% in year 2021. Gross margin in the SMS business decreases in 2022 to 0.40% from 0.54% in year 2021. But it is important to remark that the gross margin of the products deployed by QGlobal SMS was 21%, being the main objective in the SMS segment to increase the sales of those services due to its huge gross margins.
Both companies, IoT Labs and QGlobal carried 8.5 billion SMS and short codes in year 2022 compared to 7.1 billion in year 2021. This represents an increment of 1.4 billion SMS year over year or 19.72%.
IoT Labs is also responsible for the development of our award-winning Internet of Things devices SmartGas and SmartTank. The SmartGas device is perfectly focused on retail households using traditional LP gas tanks, while the SmartTank device is more oriented for industrial purposes. The Company’s product is a sensor and control chip that can be mounted on gas tanks in less than one minute, that converts the gas tank into an IoT connected device through the Company’s proprietary web portal and phone apps, allowing for constant monitoring, alerting, and refilling through the Company’s gas partners. An important milestone to highlight is that the company has received the patent for the invention and development of these devices. We continue working closely with BASF Corporation to adapt the SmartTank device to their specifications. project that has suffered some delays due to limited inventories and the slowness of the global distribution chains of microchips. However, since the end of 2022 we have expanded the list of certified suppliers and at this time we have a minimum inventory of parts, pieces and finished products to start the marketing process of both devices.
New businesses subsidiaries:
ItsBchain LLC is a 75% owned subsidiary of iQSTEL Inc. ItsBchain is a blockchain technology developer and solution provider, with a strong focus on the telecom sector. The company has focused on the development of solutions aimed at using the blockchain ledger and smart contracts to enable more efficiency, quickness in execution and fraud-prevention in the telco industry. Specifically, the company has developed a solution that will enable users and carriers to transfer mobile phone numbers with just a few clicks, allowing users and carriers the ability to transfer retail users from one mobile carrier to another instantly.
The Company has done research covering 35 countries where number portability is mandatory by law. Those 35 countries have a total of 3.3 billion population and 4.0 billion of phone lines that can be ported from one carrier to another. It is estimated that an average of 5% of the total phone lines are ported every year.
Number portability is executed and supervised by a third independent party, who act as a data-base administrator and has the responsibility to guarantee all transactions requested by the customers will be completed and his/her phone number will be ported from Carrier A to Carrier B. In the countries under our analysis there are 11 different data-base administrators.
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In terms of dollar value, the number portability market in the countries under our analysis is estimated over $86 million per year. This is based in the actual cost carriers and/or customers have to pay to get the lines ported. Revenues of the Data Base Administrators comes from a monthly fee charged to all participant carriers, plus a fee for every transaction completed over the platform. The monthly fee and the transactions fee vary from country to country.
Our objective is to offer the market conformed by data-based administrators a solution a much more cost effective solution; which will not only reduce the operating cost, but that will also make the transactions to complete faster without any additional CAPEX.
Our mobile number portability solution is now being tested prior to its commercial release in June 2023.
Global Money One Inc. Is a 75% owned subsidiary of iQSTEL Inc. The company offers a complete Fintech ecosystem including a MasterCard Debit Card, US Bank Account (No SSN Needed), and a Mobile App/Wallet to manage Remittances and Mobile Top Up. Our focus is to provide immigrants access to reliable financial services that make it easier to manage their money and stay connected with their families back home.
All available services can be managed through our mobile App “GlobalMoneyOne” available for IOS and Android. A first non-commercial release of the Fintech suite was done in June 2022. Since that date all services have been tested including the known-your-customer (KYC) process for the issuance of debits cards, the settlement process with the issuer bank, the intermediary entities handling the remittances, and the intermediaries and cellular operators for the Top Up, as well as the proper training of our customer care agents.
According to a World Bank Migration and Development brief, remittances to low- and middle-income countries reached $626 billion in 2022. The brief also stated the remittances to Latin America and the Caribbean are estimated to have grown 9.3% in 2022 to $142 billion; with increments of 45% for Nicaragua, 20% for Guatemala, 15% for Mexico, and 9% for Colombia. Stronger employment of migrants from Latin America in the United States contributed to remittance flows. As a share of GDP, remittances exceed 20% in El Salvador, Honduras, Jamaica, and Haiti.
The Electric Vehicle division (TuVolten) consist in an initiative to offer clean and affordable mobility through Electric Motorcycles, and Electric Mid Speed Cars. TuVolten is going to offer theirs EV Motorcycles and EV Cars in Spain, Portugal, USA, and some countries of Latin America. As recently announced, all previous electric motorcycle designs and tests have come together in a new electric motorcycle now rolling off the factory for the final validation tests under the European Union Standards E-Mark certification process. Once this certification is obtained, we will begin manufacturing the first units for sale to the public.
The Metaverse initiative, consist in a platform to offer our telecommunication carrier clients a white label solution enabling them to interact with their customers (end users, and enterprises) through the metaverse. The iQSTEL white label metaverse solution developed in partnership with GOTMY will be tailored to provide telecom carriers with a distinctive and immersive customer experience. In line with GOTMY’s mission to offer universally accessible experiential spaces, the iQSTEL solution for telecom carriers is intended to accommodate all mobile phone users, not just those with high-end VR headsets.
Regulations
Telecommunications services are subject to extensive government regulation in the United States of America. Any violations of the regulations may subject us to enforcement actions, including interest and penalties. The FCC has jurisdiction over all telecommunications common carriers to the extent they provide interstate or international communications services, including the use of local networks to originate or terminate such services.
Regulation of Telecom by the Federal Communications Commission
Telecommunication License
Anyone seeking to conduct telecommunications business where the telecommunication services will transpire between the United States of America and an international destination must obtain a license from the Federal Communications Commission (FCC). This particular license is named a Section 214 license, after the section in the Communications Act of 1934.
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Etelix.com USA, LLC was authorized by the Federal Communications Commission to provide facility-based services in accordance with section 63.18(e)(1) of the Commission’s rules; and also to provide resale services in accordance with section 63.18(e)(2) under license number ITC-214-20090625-00303.
Since Etelix has no other network infrastructure outside the United States of America, no other licenses are required for us to operate as an international carrier service provider.
Universal Service and Other Regulatory Fees and Charges
In 1997, the FCC issued an order, referred to as the Universal Service Order, which requires all telecommunications carriers providing interstate telecommunications services to contribute to universal service support programs administered by the FCC (known as the Universal Service Fund). These periodic contributions are currently assessed based on a percentage of each contributor’s interstate and international end user telecommunications revenues reported to the FCC. Etelix also contributed to several other regulatory funds and programs, most notably Telecommunications Relay Service and FCC Regulatory Fees (collectively, the Other Funds). Due to the manner in which these contributions are calculated, we cannot be assured that we fully recover from our customers all of our contributions.
In addition, based on the nature of our current business, we receive certain exemptions from federal Universal Service Fund contributions. Changes in our business could eliminate our ability to qualify for some or all of these exemptions. Changes in regulation may also have an impact on the availability of some or all of these exemptions. If even some of these exemptions become unavailable, they could materially increase our federal Universal Service Fund or Other Funds’ contributions and have a material adverse effect on the cost of our operations and, therefore, on our ability to continue to operate profitably, and to develop and grow our business. We cannot be certain of the stability of the contribution factors for the Other Funds. Significant increases in the contribution factor for the Other Funds in general and the Telecommunications Relay Service Fund in particular can impact our profitability. Whether these contribution factors will be stable in the future is unknown, but it is possible that we will be subject to significant increases.
Money Transmitter and Payment Instrument Laws and Regulations
The consumer payment services offerings, prepaid debit cards, remittances, Top Up, are industries heavily regulated. Accordingly, we, and the products and services that we offer in consumer payment services, are subject to a variety of federal and state laws and regulations, including:
| • | Banking laws and regulations; | |
| • | Money transmitter and payment instrument laws and regulations; | |
| • | Anti-money laundering laws;- | |
| • | Privacy and data security laws and regulations;- | |
| • | Consumer protection laws and regulations; | |
| • | Unclaimed property laws; and | |
| • | Card association and network organization rules. |
Employees
iQSTEL, including all subsidiaries, has 56 employees as of December 31, 2022.
Risks Relating to Business and Financial Condition
Our business, operating results or financial condition could be materially adversely affected by any of the following risks.
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Risk Factors Related to the Business of the Company
Because our auditor has issued a going concern opinion regarding our company, there is a risk associated with an investment in our company.
We have continually operated at a loss with an accumulated deficit of $24,504,395 as of December 31, 2022. We have not attained profitable operations and even though the company maintains a cash position very close to one third year's operating expenses, we dependent upon obtaining financing or generating revenue from operations to continue operations for the next twelve months. Our future is dependent upon our ability to obtain financing or upon future profitable operations. We reserve the right to seek additional funds through private placements of our common stock and/or through debt financing. Our ability to raise additional financing is unknown. We do not have any formal commitments or arrangements for the advancement or loan of funds. The Company has been qualified for a public offering of 10,000,000 shares of our common stock under a Form S-1. This offering is being conducted on a “best efforts” basis, which means that there is no guarantee that any minimum amount will be sold. For these reasons, our auditors stated in their report that they have substantial doubt we will be able to continue as a going concern. As a result, there is a risk that you could lose the entire amount of your investment in our company.
Our telecommunications line of business is highly sensitive to declining prices, which may adversely affect our revenues and margins.
The telecommunications industry is characterized by intense price competition, which has resulted in declines in both our average per-minute price realizations and our average per-minute termination costs.
A reduction of our prices to compete with any other offers in the market will not always guarantee an increase in the traffic, which may result in a reduction of revenue. If these trends in pricing continue or accelerate, it could have a material adverse effect on the revenues generated by our telecommunications businesses and/or our gross margins. The continued growth of Over-The-Top calling and messaging services, such as WhatsApp, Skype and Viber have adversely affected the use of traditional phone communications. We expect this IP-based service, which offers voice communications for free to continue to increase, which may result in increased substitution on our service offerings.
The termination of our carrier agreements or our inability to enter into new carrier agreements in the future could materially and adversely affect our ability to compete, which could reduce our revenues and profits.
We rely upon our carrier agreements in order to provide our telecommunications services to our customers. These carrier agreements are, in most cases for finite terms and, therefore, there can be no guarantee that these agreements will be renewed at all or on favorable terms to us. Our ability to compete would be adversely affected if our carrier agreements were terminated or we were unable to enter into carrier agreements in the future to provide our telecommunications services to our customers, which could result in a reduction of our revenues and profits.
Our customers could experience financial difficulties, which could adversely affect our revenues and profitability if we experience difficulties in collecting our receivables.
As a provider of international long-distance services, we depend upon sales of transmission and termination of traffic to other long-distance providers and the collection of receivables from these customers. The wholesale telecommunications market continues to feature many smaller, less financially stable companies. If weakness in the telecommunications industry or the global economy reduces our ability to collect our accounts receivable from our major customers our profitability may be substantially reduced. While our most significant customers, from a revenue perspective, vary from quarter to quarter, our twelve largest customers (2.97% of our total customer base) collectively accounted for 88% of total consolidated revenues in fiscal year 2022. However, this concentration of revenues does not increase our exposure to non-payment by our larger customers, since 57% of our revenue is prepaid.
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Natural disasters, terrorist acts, acts of war, pandemics, cyber-attacks or other breaches of network or information technology security may cause equipment failures or disrupt our operations.
Our inability to operate our telecommunications networks because of the events listed above, even for a limited period, may result in loss of revenue, significant expenses, which could have a material adverse effect on our results of operations and financial condition.
We could be harmed by network disruptions, security breaches, or other significant disruptions or failures of our IT infrastructure and related systems. To be successful, we need to continue to have available a high capacity, reliable and secure network for our and our customers’ use. As any other company, we face the risk of a security breach, whether through cyber-attacks, malware, computer viruses, sabotage, or other significant disruption of our IT infrastructure and related systems. There is a risk of a security breach or disruption of the systems we operate, including possible unauthorized access to our proprietary or classified information. We are also subject to breaches of our network resulting in unauthorized utilization of our services, which subject us to the costs of providing those services, which are likely not recoverable. The secure maintenance and transmission of our information is a critical element of our operations. Our information technology and other systems that maintain and transmit customer information may be compromised by a malicious third-party penetration of our network security, or impacted by advertent or inadvertent actions or inactions by our employees, or those of a third-party service provider or business partner. As a result, our or our customers’ information may be lost, disclosed, accessed or taken without the customers’ consent, or our services may be used without payment.
Although we make significant efforts to maintain the security and integrity of these types of information and systems, there can be no assurance that our security efforts and measures will be effective or that attempted security breaches or disruptions would not be successful or damaging, especially in light of the growing sophistication of cyber-attacks and intrusions. We may be unable to anticipate all potential types of attacks or intrusions or to implement adequate security barriers or other preventative measures. Certain of our business units have been the subject of attempted and successful cyber-attacks in the past. We have researched the situations and do not believe any material internal or customer information has been compromised.
We operate a global business that exposes us to currency, economic and regulatory risks.
Our revenue comes primarily from sales outside the U.S. and our growth strategy is largely focused on emerging markets. Our success delivering solutions and competing in international markets is subject to our ability to manage various risks and difficulties, including, but not limited to:
| • | our ability to effectively staff, provide technical support and manage operations in multiple countries; | |
| • | fluctuations in currency exchange rates; | |
| • | timely collecting of accounts receivable from customers located outside of the U.S.; | |
| • | trade restrictions, political instability, disruptions in financial markets, and deterioration of economic conditions; | |
| • | compliance with the U.S. Foreign Corrupt Practices Act, and other anti-bribery laws and regulations; | |
| • | variations and changes in laws applicable to our operations in different jurisdictions, including enforceability of intellectual property and contract rights; and | |
| • | compliance with export regulations, tariffs and other regulatory barriers. |
Tax Risks
We are subject to tax and regulatory audits which could result in the imposition of liabilities that may or may not have been reserved. We are subject to audits by taxing and regulatory authorities with respect to certain of our income and operations. These audits can cover periods for several years prior to the date the audit is undertaken and could result in the imposition of liabilities, interest and penalties if our positions are not accepted by the auditing entity.
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We may be unable to achieve some, all or any of the benefits that we expect to achieve from our plan to expand our operations.
In the future we may require additional financing for capital requirements and growth initiatives. Accordingly, we will depend on our ability to generate cash flows from operations and to borrow funds and issue securities in the capital markets to maintain and expand our business. We may need to incur debt on terms and at interest rates that may not be as favorable. If additional financing is not available when required or is not available on acceptable terms, we may be unable to operate our business as planned or at all, fund our expansion, successfully promote our business, develop or enhance our products and services, take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect on our business, financial condition and results of operations
Risks Relating to Our Securities
If a market for our common stock does not develop, stockholders may be unable to sell their shares.
Our common stock is quoted under the symbol “IQST” on the OTCQX operated by OTC Markets Group, Inc., an electronic inter-dealer quotation medium for equity securities. Even though we currently have an active trading market, there can be no assurance that it will be sustained.
The market price of our common stock is likely to be highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond our control.
Our stock price is subject to a number of factors, including:
| • | Technological innovations or new products and services by us or our competitors; | |
| • | Government regulation of our products and services; | |
| • | The establishment of partnerships with other telecom companies; | |
| • | Intellectual property disputes; | |
| • | Additions or departures of key personnel; | |
| • | Sales of our common stock; | |
| • | Our ability to integrate operations, technology, products and services; | |
| • | Our ability to execute our business plan; | |
| • | Operating results below or exceeding expectations; | |
| • | Whether we achieve profits or not; | |
| • | Loss or addition of any strategic relationship; | |
| • | Industry developments; | |
| • | Economic and other external factors; and | |
| • | Period-to-period fluctuations in our financial results. |
Our stock price may fluctuate widely as a result of any of the above. In addition, the securities markets have from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market price of our common stock.
Because we are subject to the “Penny Stock” rules, the level of trading activity in our stock may be reduced.
The Securities and Exchange Commission has adopted regulations which generally define "penny stock" to be any listed, trading equity security that has a market price less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exemptions. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer must also provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. In addition, the penny stock rules generally require that prior to a transaction in a penny stock, the broker-dealer make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for a stock that becomes subject to the penny stock rules which may increase the difficulty Purchasers may experience in attempting to liquidate such securities.
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We do not expect to pay dividends in the foreseeable future. Any return on investment may be limited to the value of our common stock.
We do not anticipate paying cash dividends on our common stock in the foreseeable future. The payment of dividends on our common stock will depend on earnings, financial condition and other business and economic factors affecting it at such time as the board of directors may consider relevant. If we do not pay dividends, our common stock may be less valuable because a return on your investment will occur only if our stock price appreciates.
Provisions in the Nevada Revised Statutes and our Bylaws could make it very difficult for an investor to bring any legal actions against our directors or officers for violations of their fiduciary duties or could require us to pay any amounts incurred by our directors or officers in any such actions.
Members of our board of directors and our officers will have no liability for breaches of their fiduciary duty of care as a director or officer, except in limited circumstances, pursuant to provisions in the Nevada Revised Statutes and our Bylaws as authorized by the Nevada Revised Statutes. Specifically, Section 78.138 of the Nevada Revised Statutes provides that a director or officer is not individually liable to the company or its stockholders or creditors for any damages as a result of any act or failure to act in his or her capacity as a director or officer unless it is proven that (1) the director’s or officer’s act or failure to act constituted a breach of his or her fiduciary duties as a director or officer and (2) his or her breach of those duties involved intentional misconduct, fraud or a knowing violation of law. This provision is intended to afford directors and officers protection against and to limit their potential liability for monetary damages resulting from suits alleging a breach of the duty of care by a director or officer. Accordingly, you may be unable to prevail in a legal action against our directors or officers even if they have breached their fiduciary duty of care. In addition, our Bylaws allow us to indemnify our directors and officers from and against any and all costs, charges and expenses resulting from their acting in such capacities with us. This means that if you were able to enforce an action against our directors or officers, in all likelihood, we would be required to pay any expenses they incurred in defending the lawsuit and any judgment or settlement they otherwise would be required to pay. Accordingly, our indemnification obligations could divert needed financial resources and may adversely affect our business, financial condition, results of operations and cash flows, and adversely affect prevailing market prices for our common stock.
The extent to which the coronavirus ("COVID-19") outbreak impacts our business, results of operations and financial condition will depend on future developments, which cannot be predicted.
The COVID-19 pandemic has caused and may continue to cause us to modify our business practices (including employee travel and employee work locations), and we may take further actions as may be required by government authorities or that we determine are in the best interests of our employees, customers and business partners. There is no certainty that such measures will be sufficient to mitigate the risks posed by the virus or otherwise be satisfactory to government authorities.
The COVID-19 pandemic and mitigation measures have caused, and may continue to cause, adverse impacts on global supply chains and economic conditions. These impacts could affect the development, deployment and maintenance, and the demand for our products and services, particularly the IoT SmartGas and SmartTank devices.
The extent to which the COVID-19 pandemic impacts our business, results of operations, cash flows and financial condition will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge concerning other strains of the virus and the actions to contain its impact.
The disclosures concerning our properties are contained in Item 1 Business above and incorporated herein by reference.
We have no current legal proceedings.
Item 4. Mine Safety Disclosures
Not applicable.
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PART II
Item 5. Market for Registrant’s Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information
Our common stock is quoted under the symbol “IQST” on the OTCQX operated by OTC Markets Group, Inc. Only a limited market exists for our securities. There is no assurance that a regular trading market will develop, or if developed, that it will be sustained. Therefore, a stockholder may be unable to resell his securities in our company.
The following tables set forth the range of high and low bid information for our common stock for the each of the periods indicated as reported by the OTCQX. These quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.
| Fiscal Year Ending December 31, 2022 | ||||||||||
| Quarter Ended | High $ | Low $ | ||||||||
| December 31, 2022 | 0.37 | 0.16 | ||||||||
| September 30, 2022 | 0.40 | 0.22 | ||||||||
| June 30, 2022 | 0.71 | 0.32 | ||||||||
| March 31, 2022 | 1.03 | 0.45 | ||||||||
| Fiscal Year Ending December 31, 2021 | ||||||||||
| Quarter Ended | High $ | Low $ | ||||||||
| December 31, 2021 | 1.05 | 0.39 | ||||||||
| September 30, 2021 | 0.73 | 0.35 | ||||||||
| June 30, 2021 | 1.07 | 0.44 | ||||||||
| March 31, 2021 | 2.00 | 0.15 | ||||||||
On April 10, 2023, the last sales price per share of our common stock was $0.1467.
Penny Stock
The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a market price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that: (a) contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading; (b) contains a description of the broker's or dealer's duties to the customer and of the rights and remedies available to the customer with respect to a violation of such duties or other requirements of the securities laws; (c) contains a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread between the bid and ask price; (d) contains a toll-free telephone number for inquiries on disciplinary actions; (e) defines significant terms in the disclosure document or in the conduct of trading in penny stocks; and (f) contains such other information and is in such form, including language, type size and format, as the SEC shall require by rule or regulation.
The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with (a) bid and offer quotations for the penny stock; (b) the compensation of the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and (d) a monthly account statement showing the market value of each penny stock held in the customer's account.
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In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written acknowledgment of the receipt of a risk disclosure statement, a written agreement as to transactions involving penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements may have the effect of reducing the trading activity for our common stock. Therefore, stockholders may have difficulty selling our securities.
Holders of Our Common Stock
As of April 10, 2023, we had 164,176,688 shares of our common stock issued and outstanding, held by approximately 73 stockholders of record at our transfer agent, with additional stockholders holding our shares in street name.
Dividends
We currently intend to retain future earnings for the operation of our business. We have never declared or paid cash dividends on our common stock, and we do not anticipate paying any cash dividends in the foreseeable future.
In the event that a dividend is declared, common stockholders on the record date are entitled to share ratably in any dividends that may be declared from time to time on the common stock by our board of directors from funds legally available.
There are no restrictions in our articles of incorporation or bylaws that restrict us from declaring dividends. The Nevada Revised Statutes, however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend:
| 1. | We would not be able to pay our debts as they become due in the usual course of business; or |
| 2. | Our total assets would be less than the sum of our total liabilities, plus the amount that would be needed to satisfy the rights of stockholders who have preferential rights superior to those receiving the distribution. |
Securities Authorized for Issuance under Equity Compensation Plans
We do not have an equity compensation plan.
Recent Sales of Unregistered Securities
During the year ended December 31, 2022, the Company issued 14,118,153 shares of common stock, valued at fair market value on issuance as follows:
| · | 2,000,000 shares issued for cash of $1,000,000 |
| · | 5,066,667 shares for acquisitions of Whisl and Smartbiz valued at $1,550,000 |
| · | 550,000 shares for asset acquisition valued at $357,500 |
| · | 240,000 shares for compensation to our directors valued at $107,600 |
| · | 161,367 shares for settlement of debt valued at $80,674 |
| · | 6,100,119 shares for exercise of warrants for $400,000 |
These securities were issued pursuant to Section 4(2) of the Securities Act and/or Rule 506 promulgated thereunder. The holders represented their intention to acquire the securities for investment only and not with a view towards distribution. The investors were given adequate information about us to make an informed investment decision. We did not engage in any general solicitation or advertising. We directed our transfer agent to issue the stock certificates with the appropriate restrictive legend affixed to the restricted stock.
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Item 6. Selected Financial Data
Not required under Regulation S-K for “smaller reporting companies.”
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Results of Operations for the Years Ended December 31, 2022 and 2021
Net Revenue
Our net revenue for the year ended December 31, 2022 was $93,203,532 as compared with $64,702,018 for the year ended December 31, 2021. These numbers reflect an increase of 44% year over year on our consolidated Revenues.
When looking at the numbers by subsidiary, we have the following breakout for the years ended December 31, 2022 and 2021:
| Subsidiary |
Revenue Year Ended |
Revenue Year Ended | ||||||
| Etelix.com USA, LLC | 22,301,110 | 15,445,161 | ||||||
| SwissLink Carrier AG | 4,705,031 | 4,681,978 | ||||||
| QGlobal LLC | 350,050 | 666,887 | ||||||
| IoT Labs LLC | 53,239,401 | 43,907,992 | ||||||
| Whisl | 4,318,762 | - | ||||||
| Smartbiz | 8,289,178 | - | ||||||
| 93,203,532 | 64,702,018 | |||||||
The continued growth of our revenue is the result of the development of our business strategy, which includes the strengthening of our commercial and operating activities and new acquisitions.
If net revenues continue growing at a similar rate for the next twelve months, we believe that the company will reach a total consolidated revenue of approximately $105 million by December 31, 2023.
Cost of Revenue
Our total cost of sales for the year ended December 31, 2022 was $91,412,016 as compared with $63,168,303 for the year ended December 31, 2021.
When looking at the numbers by subsidiary, we have the following breakout for the years ended December 31, 2021 and 2020:
| Subsidiary |
Cost of revenue Year Ended |
Cost of revenue Year Ended | ||||||
| Etelix.com USA, LLC | 23,360,923 | 15,080,687 | ||||||
| SwissLink Carrier AG | 3,949,751 | 3,986,334 | ||||||
| QGlobal LLC | 243,493 | 563,528 | ||||||
| IoT Labs LLC | 52,842,202 | 43,537,754 | ||||||
| Whisl | 2,760,807 | - | ||||||
| Smartbiz | 8,254,840 | - | ||||||
| 91,412,016 | 63,168,303 | |||||||
Our cost of revenues consists of direct charges from vendors that the Company incurs to deliver services to its customers. These costs primarily consist of usage charges for calls and SMS terminated in our vendor’s networks.
The behavior in the costs shows a logical correlation with the behavior of the revenue commented above. We have reached a higher volume of sales and every additional unit sold (minutes and SMS) has its corresponding termination cost.
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Gross Margin
Our gross margin, which is simply the difference between our revenues and our cost of sales, discussed above, increased from $1,533,715 in 2021 to $1,791,516 in 2022; represented an increase of 17% year over year
Operating Expenses
Operating expenses for the year ended December 31, 2022 were $4,983,176, as compared with $4,517,632 for the year ended December 31, 2021. The detail by major category is reflected in the table below.
| Years Ended December 31 | ||||||||
| 2022 | 2021 | |||||||
| Salaries, Wages and Benefits | $ | 1,662,192 | $ | 1,160,021 | ||||
| Technology | 291,348 | 218,053 | ||||||
| Professional Fees | 901,082 | 441,490 | ||||||
| Legal and Regulatory | 511,598 | 106,001 | ||||||
| Travel & Events | 93,769 | 23,117 | ||||||
| Public Cost | 31,750 | 42,674 | ||||||
| Allowance for Doubtful Accounts | 34,376 | - | ||||||
| Depreciation and Amortization | 120,117 | 91,474 | ||||||
| Advertising | 617,559 | 977,334 | ||||||
| Bank Services and Fees | 37,950 | 117,886 | ||||||
| Office, Facility and Other | 324,167 | 392,117 | ||||||
| Commissions Financial Expenses | 239,550 | - | ||||||
| Insurances | 10,118 | - | ||||||
| Subtotal | 4,875,576 | 3,570,167 | ||||||
| Stock-based compensation | 107,600 | 947,464 | ||||||
| Total Operating Expenses | $ | 4,983,176 | $ | 4,517,631 | ||||
Operating Expenses by subsidiary are as follow:
| Years Ended December 31, | ||||||||||||
| 2022 | 2021 | Difference | ||||||||||
| iQSTEL | $ | 1,762,904 | $ | 2,906,114 | $ | (1,143,210 | ) | |||||
| Etelix | 472,291 | 339,354 | 132,937 | |||||||||
| SwissLink | 767,069 | 784,052 | (16,983 | ) | ||||||||
| ItsBchain | 22,693 | 2,396 | 20,297 | |||||||||
| QGlobal | 202,933 | 106,803 | 96,130 | |||||||||
| Global Money One | 157,382 | 175,324 | (17,942 | ) | ||||||||
| IoT Labs | 264,091 | 203,588 | 60,503 | |||||||||
| Whisl | 821,979 | - | 821,979 | |||||||||
| Smartbiz | 511,834 | - | 511,834 | |||||||||
| $ | 4,983,176 | $ | 4,517,631 | $ | 465,545 | |||||||
The increment in the overall Operating Expenses is due to the new additions of Whisl and Smartbiz, totaling $1,333,813. This was partially offset by the $868,298 reduction in Operating Expenses by the remaining companies most significantly by iQSTEL, whose expenses were reduced by $1,143,210.
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Other Expenses
We had other expenses of $2,674,101 for the year ended December 31, 2022, as compared with other expenses of $880,085 for the year ended December 31, 2021. The increase in Other Expenses in 2022 compared to 2021 is due to the Change in fair value of derivative liabilities of $(2,650,369) for the year ended December 31, 2022 from a positive $317,080 for the year ended December 31, 2021.
Net Loss
We finished the year ended December 31, 2022 with a loss of $5,865,761 as compared to a loss of $3,864,001 during the year ended December 31, 2021. The amount of year 2022 is highly impacted by the $(2,650,369) change in fair value of the derivative liabilities .
Liquidity and Capital Resources
As of December 31, 2022 we had total current assets of $6,436,590, compared with current liabilities of $6,451,679, resulting in a negative working capital of $15,089 and a current ratio of approximately 0.99 to 1.
Following is a table with summary data from the consolidated statement of cash flows for the year ended December 31, 2022 and 2021, as presented.
| 2022 | 2021 | |||||||
| Net cash used in operating activities | $ | (1,765,060 | ) | $ | (3,152,181 | ) | ||
| Net cash used in investing activities | (2,001,506 | ) | (511,348 | ) | ||||
| Net cash provided by financing activities | 1,767,982 | 6,250,980 | ||||||
| Effect of exchange rate changes on cash | (6,840 | ) | (5,954 | ) | ||||
| Net change in cash and cash equivalents | $ | (2,005,424) | $ | 2,581,497 | ||||
Our operating activities used $1,765,060 in the year ended December 31, 2022, as compared with $3,152,181 used in operating activities in the year ended December 31, 2021. Our cash flow from operations varies depending on our operating results and the timing of operating cash receipts and payments, specifically trade accounts receivable and trade accounts payable. Our negative operating cash flows in 2022 and 2021 is largely the result of our net loss for the years.
Investing activities used $2,001,506 for the year ended December 31, 2022, as compared with $511,348 used in investing activities for the year ended December 31, 2021. Our negative investing cash flow for 2022 is largely due to the acquisition of Whisl and Smartbiz of $1,889,132 and the purchase of $112,074 of equipment.
Financing activities provided $1,767,982 for the year ended December 31, 2022, as compared to $6,250,980 provided for the year ended December 31, 2021. Our positive financing cash flow in 2022 was largely the result of the $1,100,000 from the issuance of new common stock, $400,000 from the exercise of stock options and $500,000 from the issuance of common stock purchase options.
Based upon our current financial condition, we do not have sufficient cash to operate our business at the current level for the next twelve months. We intend to fund operations through increased sales and debt and/or equity financing arrangements, which may be insufficient to fund expenditures or other cash requirements. The Company has received the qualification of an Offering Statement under Form S-1 for the sale of up to 10,000,000 common stocks. This offering is being conducted on a “best efforts” basis, which means that there is no guarantee that any minimum amount will be sold. We also plan to seek additional financing in a private equity offering to secure funding for operations. There can be no assurance that we will be successful in raising additional funding. If we are not able to secure additional funding, the implementation of our business plan will be impaired. There can be no assurance that such additional financing will be available to us on acceptable terms or at all.
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Inflation
Although our operations are influenced by general economic conditions, we do not believe that inflation had a material effect on our results of operations during the twelve-month period ended December 31, 2022.
Critical Accounting Policies
A “critical accounting policy” is one which is both important to the portrayal of a company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.
Our accounting policies are discussed in detail in the footnotes to our financial statements included in this Annual Report on Form 10-K for the year ended December 31, 2022; however, we consider our critical accounting policies to be those related to the allowance for doubtful accounts, valuation of assets, significant estimates in the valuation of financial instruments and income taxes. Management bases its estimates and judgments on historical experience and other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. See the Consolidated Financial Statements in this Annual Report for a complete discussion of our significant accounting policies.
Off Balance Sheet Arrangements
As of December 31, 2022, there were no off-balance sheet arrangements.
Recently Issued Accounting Pronouncements
We do not expect the adoption of these or other recently issued accounting pronouncements to have a significant impact on our results of operation, financial position or cash flow.
Item 8. Financial Statements and Supplementary Data
Index to Financial Statements Required by Article 8 of Regulation S-X:
|
Audited Financial Statements:
| |
| F-1 | Report of Independent Registered Public Accounting Firm (PCAOB ID i 1013); |
| F-3 | Consolidated Balance Sheets as of December 31, 2022 and 2021; |
| F-4 | Consolidated Statements of Operations for the years ended December 31, 2022 and 2021; |
| F-5 | Consolidated Statement of Stockholders’ Deficit for the years ended December 31, 2022 and 2021; |
| F-6 | Consolidated Statements of Cash Flows for the years ended December 31, 2022 and 2021; and |
| F-7 | Notes to Consolidated Financial Statements. |
| 18 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and Board of Directors
iQSTEL, Inc.
Coral Gables, FL
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of iQSTEL, Inc. (the “Company”) as of December 31, 2022 and 2021, the related consolidated statements of operations, changes in stockholders’ equity (deficit), and cash flows for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America.
Going Concern Uncertainty – See Also Critical Audit Matters Section Below
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the consolidated financial statements, the Company has suffered recurring losses from operations and does not have an established source of revenues sufficient to cover its operating costs, which raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 3. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Revenue Recognition
Critical Audit Matter Description
The Company recognizes revenue upon transfer of control of promised services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those services.
Significant judgment is exercised by the Company in determining revenue recognition for customer agreements, and include the pattern of delivery (i.e., timing of when revenue is recognized) for each distinct performance obligation.
The related audit effort in evaluating management’s judgments in determining revenue recognition for customer agreements required a high degree of auditor judgment.
How the Critical Audit Matter was Addressed in the Audit
Our principal audit procedures related to the Company’s revenue recognition for customer agreements included the following:
| • | We gained an understanding of internal controls related to revenue recognition. | ||
| • | We evaluated management’s significant accounting policies for reasonableness. | ||
| • | We selected a sample of revenues recognized and performed the following procedures: | ||
| Ο | Obtained and read contract source documents for each selection and other documents that were part of the agreement, if applicable. | ||
| Ο | Assessed the terms in the customer agreement and evaluated the appropriateness of management’s application of their accounting policies, along with their use of estimates, in the determination of revenue recognition conclusions. | ||
| Ο | We tested the mathematical accuracy of management’s calculations of revenue and the associated timing of revenue recognized in the financial statements. | ||
| Ο | We confirmed significant customer balances. | ||
Going Concern
Critical Audit Matter Description
As described further in Note 3 to the consolidated financial statements, the Company has suffered recurring losses from operations and does not have an established source of revenues sufficient to cover its operating costs. The ability of the Company to continue as a going concern is dependent on executing its business plan and ultimately to attain profitable operations. Accordingly, the Company has determined that these factors raise substantial doubt as to the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. Management intends to continue to fund its business by way of public or private offerings of the Company’s stock or through loans from private investors, in order satisfy the Company’s obligations as they come due for at least one year from the financial statement issuance date. However, the Company has not concluded that these plans alleviate the substantial doubt related to its ability to continue as a going concern.
How the Critical Audit Matter was Addressed in the Audit
We determined the Company’s ability to continue as a going concern is a critical audit matter due to the estimation and uncertainty regarding the Company’s available capital and the risk of bias in management’s judgments and assumptions in their determination. Our audit procedures related to the Company’s assertion on its ability to continue as a going concern included the following, among others:
| · | We performed testing procedures such as analytical procedures to identify conditions and events that indicate that there could be substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time. |
| · | We reviewed and evaluated management's plans for dealing with adverse effects of these conditions and events. |
| · | We inquired of Company management and reviewed company records to assess whether there are additional factors that contribute to the uncertainties disclosed. |
| · | We assessed whether the Company’s determination that there is substantial doubt about its ability to continue as a going concern was adequately disclosed. |
We have served as the Company's auditor since 2020.
| F-1 |
iQSTEL INC
Consolidated Balance Sheets
| December 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash | $ | i 1,329,389 | $ | i 3,334,813 | ||||
| Accounts receivable, net | i 4,209,125 | i 2,540,515 | ||||||
| Inventory | i 26,124 | — | ||||||
| Due from related parties | i 326,324 | i 424,086 | ||||||
| Prepaid and other current assets | i 545,628 | i 267,110 | ||||||
| Total Current Assets | i 6,436,590 | i 6,566,524 | ||||||
| Property and equipment, net | i 401,021 | i 409,382 | ||||||
| Intangible assets | i 99,592 | i 99,592 | ||||||
| Goodwill | i 5,172,146 | i 1,537,742 | ||||||
| Deferred tax assets | i 440,135 | i 446,402 | ||||||
| TOTAL ASSETS | $ | i 12,549,484 | $ | i 9,059,642 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current Liabilities | ||||||||
| Accounts payable | i 2,254,636 | i 1,474,595 | ||||||
| Accrued and other current liabilities | i 2,482,352 | i 307,049 | ||||||
| Due to related parties | i 26,613 | i 26,613 | ||||||
| Loans payable - net of discount of $ i 0 and $ i 7,406 | i 94,342 | i 315,450 | ||||||
| Loans payable - related parties | i 235,949 | i 239,308 | ||||||
| Derivative liabilities | i 1,357,787 | — | ||||||
| Total Current Liabilities | i 6,451,679 | i 2,363,015 | ||||||
| Loans payable, non-current | i 108,150 | i 119,295 | ||||||
| Employee benefits, non-current | i 154,238 | i 156,434 | ||||||
| TOTAL LIABILITIES | i 6,714,067 | i 2,638,744 | ||||||
| Stockholders' Equity | ||||||||
| Preferred stock: authorized; par value | ||||||||
| Series A Preferred stock:
designated;
par value, shares issued and outstanding, respectively | i 10 | i 10 | ||||||
| Series B Preferred stock:
designated;
par value, shares issued and outstanding | i 21 | i 21 | ||||||
| Series C Preferred stock: designated; par value, shares issued and outstanding | — | — | ||||||
| Common stock:
authorized;
par value and shares issued and outstanding, respectively | i 161,595 | i 147,477 | ||||||
| Additional paid in capital | i 31,136,120 | i 25,842,982 | ||||||
| Accumulated deficit | ( i 24,504,395 | ) | ( i 18,536,921 | ) | ||||
| Accumulated other comprehensive loss | ( i 33,557 | ) | ( i 36,658 | ) | ||||
| Equity attributed to stockholders of iQSTEL Inc. | i 6,759,794 | i 7,416,911 | ||||||
| Deficit attributable to noncontrolling interests | ( i 924,377 | ) | ( i 996,013 | ) | ||||
| TOTAL STOCKHOLDERS' EQUITY | i 5,835,417 | i 6,420,898 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | i 12,549,484 | $ | i 9,059,642 | ||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-2 |
iQSTEL INC
Consolidated Statements of Operations
| Years Ended | ||||||||
| December 31, | ||||||||
| 2022 | 2021 | |||||||
| Revenues | $ | i 93,203,532 | $ | i 64,702,018 | ||||
| Cost of revenue | i 91,412,016 | i 63,168,303 | ||||||
| Gross profit | i 1,791,516 | i 1,533,715 | ||||||
| Operating expenses | ||||||||
| General and administration | i 4,983,176 | i 4,517,631 | ||||||
| Total operating expenses | i 4,983,176 | i 4,517,631 | ||||||
| Operating loss | ( i 3,191,660 | ) | ( i 2,983,916 | ) | ||||
| Other income (expense) | ||||||||
| Other income | i 118,871 | i 4,426 | ||||||
| Other expenses | ( i 112,962 | ) | i 2,684 | |||||
| Interest expense | ( i 29,641 | ) | ( i 675,481 | ) | ||||
| Change in fair value of derivative liabilities | ( i 2,650,369 | ) | i 317,080 | |||||
| Loss on settlement of debt | — | ( i 528,794 | ) | |||||
| Total other expense | ( i 2,674,101 | ) | ( i 880,085 | ) | ||||
| Net loss before provision for income taxes | ( i 5,865,761 | ) | ( i 3,864,001 | ) | ||||
| Income taxes | — | — | ||||||
| Net loss | ( i 5,865,761 | ) | ( i 3,864,001 | ) | ||||
| Less: Net income (loss) attributable to noncontrolling interests | i 101,713 | ( i 26,228 | ) | |||||
| Net loss attributed to stockholders of iQSTEL Inc. | $ | ( i 5,967,474 | ) | $ | ( i 3,837,773 | ) | ||
| Comprehensive income (loss) | ||||||||
| Net loss | $ | ( i 5,865,761 | ) | $ | ( i 3,864,001 | ) | ||
| Foreign currency adjustment | i 6,080 | i 74,849 | ||||||
| Total comprehensive loss | $ | ( i 5,859,681 | ) | $ | ( i 3,789,152 | ) | ||
| Less: Comprehensive income attributable to noncontrolling interests | i 104,692 | i 10,448 | ||||||
| Net comprehensive loss attributed to stockholders of iQSTEL Inc. | $ | ( i 5,964,373 | ) | $ | ( i 3,799,600 | ) | ||
| Basic and diluted loss per common share | $ | ( i 0.04 | ) | $ | ( i 0.03 | ) | ||
| Weighted average number of common shares outstanding - Basic and diluted | i 151,850,443 | i 135,383,893 | ||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-3 |
iQSTEL INC
Consolidated Statements of Changes in Stockholders’ Equity (Deficit)
For the years ended December 31, 2022 and 2021
| Series A Preferred Stock | Series B Preferred Stock | Common Stock | |||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Additional Paid in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total | Non Controlling Interest | Total Stockholders’ Deficit | ||||||||||||||||||||||||||||||||||||
| Balance - December 31, 2020 | i 10,000 | $ | i 10 | — | $ | — | i 118,133,432 | $ | i 118,133 | $ | i 13,267,261 | $ | ( i 14,699,148 | ) | $ | ( i 74,831 | ) | $ | ( i 1,388,575 | ) | $ | ( i 1,006,461 | ) | $( i 2,395,036) | |||||||||||||||||||||||
| Preferred stock issued for conversion of common stock | — | — | i 21,000 | i 21 | ( i 21,000,000 | ) | ( i 21,000 | ) | i 20,979 | — | — | — | — | — | |||||||||||||||||||||||||||||||||
| Common stock issued for cash and subscription receivable | — | — | — | — | i 41,562,500 | i 41,563 | i 6,394,687 | — | — | i 6,436,250 | — | i 6,436,250 | |||||||||||||||||||||||||||||||||||
| Common stock issued for settlement of debt | — | — | — | — | i 2,230,394 | i 2,230 | i 2,054,300 | — | — | i 2,056,530 | — | i 2,056,530 | |||||||||||||||||||||||||||||||||||
| Common stock issued for service | — | — | — | — | i 195,000 | i 195 | i 284,505 | — | — | i 284,700 | — | i 284,700 | |||||||||||||||||||||||||||||||||||
| Common stock issued for compensation | — | — | — | — | i 1,320,000 | i 1,320 | i 1,036,248 | — | — | i 1,037,568 | — | i 1,037,568 | |||||||||||||||||||||||||||||||||||
| Common stock issued for forbearance of debt | — | — | — | — | i 250,000 | i 250 | i 49,675 | — | — | i 49,925 | — | i 49,925 | |||||||||||||||||||||||||||||||||||
| Common stock issued for conversion of debt | — | — | — | — | i 6,080,632 | i 6,081 | i 416,214 | — | — | i 422,295 | — | i 422,295 | |||||||||||||||||||||||||||||||||||
| Common stock payable | — | — | — | — | — | — | i 52,161 | — | — | i 52,161 | — | i 52,161 | |||||||||||||||||||||||||||||||||||
| Related party debt to equity swap | — | — | — | — | — | — | i 1,647,150 | — | — | i 1,647,150 | — | i 1,647,150 | |||||||||||||||||||||||||||||||||||
| Cancellation of common stock | — | — | — | — | ( i 1,294,600 | ) | ( i 1,295 | ) | ( i 88,809 | ) | — | — | ( i 90,104 | ) | — | ( i 90,104) | |||||||||||||||||||||||||||||||
| Resolution of derivative liabilities | — | — | — | — | — | — | i 708,611 | — | — | i 708,611 | — | i 708,611 | |||||||||||||||||||||||||||||||||||
| Foreign currency translation adjustments | — | — | — | — | — | — | — | — | i 38,173 | i 38,173 | i 36,676 | i 74,849 | |||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | ( i 3,837,773 | ) | — | ( i 3,837,773 | ) | ( i 26,228 | ) | ( i 3,864,001) | ||||||||||||||||||||||||||||||||
| Balance - December 31, 2021 | i 10,000 | $ | i 10 | i 21,000 | $ | i 21 | i 147,477,358 | $ | i 147,477 | $ | i 25,842,982 | $ | i 18,536,921 | ) | $ | ( i 36,658 | ) | $ | i 7,416,911 | $ | ( i 996,013 | ) | $ i 6,420,898 | ||||||||||||||||||||||||
| Common stock issued for cash | — | — | — | — | i 2,000,000 | i 2,000 | i 998,000 | — | — | i 1,000,000 | — | i 1,000,000 | |||||||||||||||||||||||||||||||||||
| Common stock issued for acquisitions of subsidiaries | — | — | — | — | i 5,066,667 | i 5,067 | i 1,544,933 | — | — | i 1,550,000 | ( i 33,056 | ) | i 1,516,944 | ||||||||||||||||||||||||||||||||||
| Common stock issued for asset acquisition | — | — | — | — | i 550,000 | i 550 | i 356,950 | — | — | i 357,500 | — | i 357,500 | |||||||||||||||||||||||||||||||||||
| Common stock issued for compensation | — | — | — | — | i 240,000 | i 240 | i 107,360 | — | — | i 107,600 | — | i 107,600 | |||||||||||||||||||||||||||||||||||
| Common stock issued for settlement of debt | — | — | — | — | i 161,367 | i 161 | i 80,513 | — | — | i 80,674 | — | i 80,674 | |||||||||||||||||||||||||||||||||||
| Common stock issued for warrant exercises | — | — | — | — | i 6,100,119 | i 6,100 | i 393,900 | — | — | i 400,000 | — | i 400,000 | |||||||||||||||||||||||||||||||||||
| Common stock payable | — | — | — | — | — | — | i 18,900 | — | — | i 18,900 | — | i 18,900 | |||||||||||||||||||||||||||||||||||
| Resolution of derivative liabilities upon exercise of warrants | — | — | — | — | — | — | i 1,792,582 | — | — | i 1,792,582 | — | i 1,792,582 | |||||||||||||||||||||||||||||||||||
| Foreign currency translation adjustments | — | — | — | — | — | — | — | — | i 3,101 | i 3,101 | i 2,979 | i 6,080 | |||||||||||||||||||||||||||||||||||
| Net (loss) income | — | — | — | — | — | — | — | ( i 5,967,474 | ) | — | ( i 5,967,474 | ) | i 101,713 | ( i 5,865,761) | |||||||||||||||||||||||||||||||||
| Balance - December 31, 2022 | i 10,000 | $ | i 10 | i 21,000 | $ | i 21 | i 161,595,511 | $ | i 161,595 | $ | i 31,136,120 | $ | ( i 24,504,395 | ) | $ | ( i 33,557 | ) | $ | i 6,759,794 | $ | ( i 924,377 | ) | $ | i 5,835,417 | |||||||||||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-4 |
iQSTEL INC
Consolidated Statements of Cash Flows
| Years Ended | ||||||||
| December 31, | ||||||||
| 2022 | 2021 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | ( i 5,865,761 | ) | $ | ( i 3,864,001 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Stock-based compensation | i 126,500 | i 1,284,325 | ||||||
| Bad debt expense | i 34,376 | i — | ||||||
| Write-off of due from related party | — | i 10,148 | ||||||
| Depreciation and amortization | i 120,117 | i 91,474 | ||||||
| Amortization of debt discount | i 7,407 | i 450,771 | ||||||
| Change in fair value of derivative liabilities | i 2,650,369 | ( i 317,080 | ) | |||||
| Loss on settlement of debt | — | i 528,794 | ||||||
| Prepayment and default penalty | — | i 122,020 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | ( i 799,533 | ) | ( i 39,862 | ) | ||||
| Inventory | ( i 26,124 | ) | — | |||||
| Prepaid and other current assets | ( i 23,728 | ) | ( i 91,066 | ) | ||||
| Due from related party | i 96,863 | — | ||||||
| Accounts payable | ( i 265,511 | ) | ( i 1,231,946 | ) | ||||
| Accrued and other current liabilities | i 2,179,965 | ( i 95,758 | ) | |||||
| Net cash used in operating activities | ( i 1,765,060 | ) | ( i 3,152,181 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Acquisitions of subsidiaries, net of cash acquired | ( i 1,889,132 | ) | ( i 60,000 | ) | ||||
| Purchase of property and equipment | ( i 112,074 | ) | ( i 153,183 | ) | ||||
| Purchase of intangible assets | — | ( i 77,717 | ) | |||||
| Payment of loan receivable - related party | ( i 1,000 | ) | ( i 220,674 | ) | ||||
| Collection of amounts due from related parties | i 700 | i 226 | ||||||
| Net cash used in investing activities | ( i 2,001,506 | ) | ( i 511,348 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds from loans payable | — | i 600,000 | ||||||
| Repayments of loans payable | ( i 232,018 | ) | ( i 344,483 | ) | ||||
| Repayment of loans payable - related parties | — | ( i 90,787 | ) | |||||
| Proceeds from common stock issued | i 1,100,000 | i 6,336,250 | ||||||
| Proceeds from exercise of warrants | i 400,000 | — | ||||||
| Proceeds from issuance of common stock purchase options | i 500,000 | — | ||||||
| Repayment of convertible notes | i — | ( i 250,000 | ) | |||||
| Net cash provided by financing activities | i 1,767,982 | i 6,250,980 | ||||||
| Effect of exchange rate changes on cash | ( i 6,840 | ) | ( i 5,954 | ) | ||||
| Net change in cash | ( i 2,005,424 | ) | i 2,581,497 | |||||
| Cash, beginning of period | i 3,334,813 | i 753,316 | ||||||
| Cash, end of period | $ | i 1,329,389 | $ | i 3,334,813 | ||||
| Supplemental cash flow information | ||||||||
| Cash paid for interest | $ | i 3,333 | $ | i 126,818 | ||||
| Cash paid for taxes | $ | — | $ | — | ||||
| Non-cash transactions: | ||||||||
| Common stock payable | $ | i 18,900 | i 52,161 | |||||
| Common stock issued for asset acquisition | $ | i 357,500 | $ | — | ||||
| Common stock issued for acquisitions of subsidiaries | $ | i 1,550,000 | $ | — | ||||
| Common stock issued for conversion of debt | $ | — | $ | i 422,295 | ||||
| Common stock issued for exercise of cashless warrants | $ | i 3,790 | $ | — | ||||
| Resolution of derivative liabilities upon exercise of warrants | $ | i 1,792,582 | $ | i 708,611 | ||||
| Related party debt forgiveness | $ | — | $ | i 1,647,150 | ||||
| Common stock issued for settlement of debt | $ | i 80,674 | $ | i 2,056,530 | ||||
| Common stock issued for forbearance of debt | $ | — | $ | i 49,925 | ||||
| Preferred stock issued for conversion of common stock | $ | — | $ | i 21 | ||||
| Subscription receivable | $ | — | $ | i 100,000 | ||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-5 |
iQSTEL INC
Notes to the Consolidated Financial Statements
i
NOTE 1 -ORGANIZATION AND DESCRIPTION OF BUSINESS
i
Organization and Operations
iQSTEL Inc. (“iQSTEL”, “we”, “us”, or the “Company”) was incorporated under the laws of the State of i Nevada on i June 24, 2011 under the name of B-Maven Inc. The Company changed its name to PureSnax International, Inc. on September 18, 2015; and more recently it changed its name to iQSTEL Inc. on August 7, 2018.
The Company has been engaged in the business of telecommunication services as a wholesale carrier of voice, SMS and data for other telecom companies around the World with 404 active interconnection agreements with mobile companies, fixed line companies and other wholesale carriers.
/ i
Acquisitions
On May 13, 2022, we entered into a Company Acquisition Agreement regarding the acquisition of i 51% of the shares in Whisl telecom LLC (“Whisl”).
On June 1, 2022, we entered into a Company Acquisition Agreement regarding the acquisition of i 51% of the shares in Smartbiz Telecom LLC (“Smartbiz”).
Both acquisitions are detailed in Note 4.
/ i
COVID-19
A novel strain of coronavirus (COVID-19) was first identified in December 2019, and subsequently declared a global pandemic by the World Health Organization on March 11, 2020. As a result of the outbreak, many companies experienced disruptions in their operations and in markets served. The Company has instituted some and may take additional temporary precautionary measures intended to help ensure the well-being of its employees and minimize business disruption. The Company considered the impact of COVID-19 on the assumptions and estimates used and determined that there were no material adverse impacts on the Company’s results of operations and financial position at December 31, 2022. The full extent of the future impacts of COVID-19 on the Company’s operations is uncertain. A new prolonged outbreak could have a material adverse impact on financial results and business operations of the Company, including the timing and ability of the Company to collect accounts receivable and the ability of the Company to continue to provide high quality services to its clients. The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of April 14, 2023, the date of issuance of this Annual Report on Form 10-K. These estimates may change, as new events occur, and additional information is obtained.
/ i
NOTE 2 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
i
Basis of Presentation
The consolidated financial statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial statements have been prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) of the United States of America. The Company’s fiscal year end is December 31.
i
Consolidation Policy
The consolidated financial statements of the Company include the accounts of the Company and its owned subsidiaries, Etelix.com USA, LLC (“Etelix”), SwissLink Carrier AG (“Swisslink”), ITSBCHAIN, LLC (“ItsBchain”), QGLOBAL SMS, LLC (“QGlobal”), IoT Labs, LLC (“IoT Labs”), Global Money One Inc (“Global Money One”), Whisl Telecom LLC (“Whisl”) and Smartbiz Telecom LLC (“Smartbiz”). All significant intercompany balances and transactions have been eliminated in consolidation.
| F-6 |
i
Use of Estimates
The preparation of the consolidated financial statements in conformity with GAAP in the United States of America 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. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.
i
Business Combinations
In accordance with ASC 805-10, “Business Combinations”, the Company accounts for all business combinations using the acquisition method of accounting. Under this method, assets and liabilities, including any remaining non-controlling interests, are recognized at fair value at the date of acquisition. The excess of the purchase price over the fair value of assets acquired, net of liabilities assumed, and non-controlling interests is recognized as goodwill. Certain adjustments to the assessed fair values of the assets, liabilities, or non-controlling interests made subsequent to the acquisition date, but within the measurement period, which is up to one year, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded in income. Any cost or equity method interest that the Company holds in the acquired company prior to the acquisition is re-measured to fair value at acquisition with a resulting gain or loss recognized in income for the difference between fair value and the existing book value. Results of operations of the acquired entity are included in the Company’s results from the date of the acquisition onward and include amortization expense arising from acquired tangible and intangible assets.
i
Foreign Currency Translation and Re-measurement
The Company translates its foreign operations to U.S. dollars in accordance with ASC 830, “Foreign Currency Matters”.
The functional currency and reporting currency of Etelix, QGlobal, ItsBchain, IoT Labs, Whisl, Smartbiz and Global Money One is the U.S. dollar, while SwissLink’s functional currency is the Swiss Franc (“CHF”).
SwissLink translates their records into U.S. dollars as follows:
| • | Assets and liabilities at the rate of exchange in effect at the balance sheet date |
| • | Equities at historical rate |
| • | Revenue and expense items at the average rate of exchange prevailing during the period |
Adjustments arising from such translations are included in accumulated other comprehensive income (loss) in stockholders’ equity.
i
Cash and Cash Equivalents
Cash and cash equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three months from inception, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value. The Company had i i no / cash equivalents at December 31, 2022 and 2021.
/ i
Accounts Receivable and Allowance for Uncollectible Accounts
Substantially all of the Company’s accounts receivable balance is related to trade receivables. Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable. The Company reviews its allowance for doubtful accounts daily and past due balances over 60 days and a specified amount are reviewed individually for collectability. Account balances are charged off after all means of collection have been exhausted and the potential for recovery is considered remote. During the years ended December 31, 2022 and 2021, the Company recorded bad debt expense of $ i 34,376 and $ i 0, respectively.
| F-7 |
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Inventory
Inventories, consisting of smart gas parts, are primarily accounted for using the first-in-first-out (“FIFO”) method of accounting. Inventories are measured at the lower of cost and net realizable value. The Company estimates the net realizable value of inventories based on an assessment of expected sales prices.
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Long-Lived Assets
Long-lived assets are evaluated for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test is based on a comparison of the undiscounted future cash flows to the recorded value of the asset. If impairment is indicated, the asset is written down to its estimated fair value.
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Fixed Assets
Fixed assets, consisting of telecommunications equipment and software, are recorded at cost reduced by accumulated depreciation and amortization. Depreciation and amortization expense is recognized over the assets’ estimated useful lives of i 3 years for computers and laptops; i 5 years for telecommunications equipment and switches; and i 5 years for software using the straight-line method. Major additions and improvements are capitalized as additions to the property and equipment accounts, while replacements, maintenance and repairs that do not improve or extend the life of the respective assets are expensed as incurred. Estimated useful lives are periodically reviewed and, when appropriate, changes are made prospectively. When certain events or changes in operating conditions occur, asset lives may be adjusted and an impairment assessment may be performed on the recoverability of the carrying amounts.
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Impairment of tangible and intangible assets
Tangible and intangible assets (excluding goodwill) are assessed at each reporting date for indications that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the asset's recoverable amount. The asset's recoverable amount is the higher of an asset's or cash-generating unit's fair value less costs of disposal and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or a group of assets exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or the group of assets.
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Goodwill
We allocate goodwill to reporting units based on the reporting unit expected to benefit from the business combination. We evaluate our reporting units on an annual basis and, if necessary, reassign goodwill using a relative fair value allocation approach. Goodwill is tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. These events or circumstances could include a significant change in the business climate, legal factors, operating performance indicators, competition, or sale or disposition of a significant portion of a reporting unit.
Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit. The fair value of each reporting unit is estimated primarily through the use of a discounted cash flow methodology. This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital.
The estimates used to calculate the fair value of a reporting unit change from year to year based on operating results, market conditions, and other factors. Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment for each reporting unit.
| F-8 |
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Retirement Benefit Costs
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due. Payments made to state-managed retirement benefit schemes are dealt with as payments to defined contribution schemes where the Company’s obligations under the schemes are equivalent to those arising in a defined contribution retirement benefit scheme.
For defined benefit schemes, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains and losses are recognized in full in the period in which they occur. They are recognized outside the income statement and are presented in other comprehensive income. Past service cost is recognized immediately in the income statement in the period in which it occurs.
The retirement benefit obligation recognized in the balance sheet represents the present value of the defined obligation as adjusted for unrecognized past service cost, and as reduced by the fair value of the scheme assets. Any asset resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in future contributions to the scheme.
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The Company has adopted ASC 260, ”Earnings per Share” which requires presentation of basic earnings per share on the face of the statements of operations for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic earnings per share computation. In the accompanying financial statements, basic loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the year. Diluted earnings per share is computed by dividing net income by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options and warrants unless the result would be antidilutive. Dilutive potential common shares include outstanding Series B Preferred stock, and it was excluded from the computation of diluted net loss per share as the result was anti-dilutive for the years ended December 31, 2022 and 2021.
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Concentrations of Credit Risk
The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents and related party payables. The Company places its cash and cash equivalents with financial institutions of high creditworthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits.
During the year ended December 31, 2022 12 customers represented i 88% of our revenue compared to 7 customers representing i 88% of our revenue for the year ended December 31, 2021. For the years ended December 31, 2022 and 2021, i 57% and i 68% of the revenue comes from customers under prepayment conditions which means there is no credit or bad debt risk on that portion of the customers portfolio.
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Financial Instruments
The Company follows ASC 820, “Fair Value Measurements and Disclosures,” which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:
Level 1
Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
| F-9 |
Level 2
Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
Level 3
Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.
The carrying values of our financial instruments, including, cash; accounts receivable; prepaid and other current assets; accounts payable; accrued liabilities and other current liabilities; and due from/to related parties approximate their fair values due to the short-term maturities of these financial instruments.
Transactions involving related parties cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated. It is not, however, practical to determine the fair value of amounts due to related parties due to their related party nature.
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Derivative Financial Instruments
The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. We evaluate all of our financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, the Company used a Black Scholes valuation model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date.
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Income Taxes
The Company uses the liability method of accounting for income taxes. Under the liability method, deferred tax assets and liabilities are determined based on differences between financial reporting and the tax basis of assets, liabilities, the carry forward of operating losses and tax credits, and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. An allowance against deferred tax assets is recorded when it is more likely than not that such tax benefits will not be realized.
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Related Parties
The Company follows ASC 850, “Related Party Disclosures,” for the identification of related parties and disclosure of related party transactions (see Note 13).
| F-10 |
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Revenue Recognition
The Company recognizes revenue from telecommunication services in accordance with ASC 606, “Revenue from Contracts with Customers.”
The Company recognizes revenue related to monthly usage charges and other recurring charges during the period in which the telecommunication services are rendered, provided that persuasive evidence of a sales arrangement exists, and collection is reasonably assured. Management considers persuasive evidence of a sales arrangement to be a written interconnection agreement. The Company’s payment terms vary by client.
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Cost of revenue
Costs of revenue represent direct charges from vendors that the Company incurs to deliver services to its customers. These costs primarily consist of usage charges for calls terminated in vendors networks.
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Lease
The Company leases office space for corporate and network monitoring activities and to house telecommunications equipment.
In accordance with ASC 842, “Leases,” we determine if an arrangement is a lease at inception.
The office lease meets the definition of a short-term lease because the lease term is 12 months or less. Consequently, consistent with Company’s accounting policy election, the Company does not recognize the right-of-use asset and the lease liability arising from this lease.
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Recent Accounting Pronouncements
In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments Credit Losses —Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 requires a financial asset (or group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected, which includes the Company’s accounts receivable. This ASU is effective for the Company for reporting periods beginning after December 15, 2022. The Company is currently assessing the potential impact that the adoption of this ASU will have on its consolidated financial statements.
In June 2022, the FASB issued ASU 2022-03, ASC Subtopic “Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions.” These amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments in this update are effective for public business entities for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2023. Early adoption is permitted. The Company is currently assessing the impact of the adoption of this standard on its consolidated financial statements.
The Company has reviewed all other recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on our financial statements.
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NOTE 3 - GOING CONCERN
The Company's consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has suffered recurring losses from operations and does not have an established source of revenues sufficient to cover its operating costs. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
| F-11 |
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish its business plan and eventually attain profitable operations.
During the next year, the Company's foreseeable cash requirements will relate to continual development of the operations of its business, maintaining its good standing in the industry and continuing its marketing efforts. The Company may experience a cash shortfall and be required to raise additional capital.
Historically, the Company has relied upon funds from its stockholders. Management may raise additional capital through future public or private offerings of the Company's stock or through loans from private investors, although there can be no assurance that it will be able to obtain such financing. The Company's failure to do so could have a material and adverse effect upon its operations and its stockholders.
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NOTE 4 - ACQUISITIONS
On May 13, 2022, we entered into a Company Acquisition Agreement (Purchase Agreement) with US Acquisitions, LLC, a California limited liability company (Seller) concerning the contemplated sale by Seller and the purchase by us of i 51% of the membership interests Seller held in Whisl, a Texas limited liability company. Whisl provides local US termination for Voice through its FCC license of VoIP Service number 832742; and is in the process to obtain a C-Lec FCC License over next 12 months. Whisl is one of the premier Intermediate Voice Providers in the USA. It has been a carrier since 2017 with billions of minutes traversing its network and provides its customers with multiple levels of Redundancy, Diversity, and Disaster Recovery for their applications and ability to make changes to underlying carrier configuration in real time. Whisl offers a single carrier solution for Voice Global services, and its customers benefit from hundreds of interconnection agreements that the company has cultivated since its inception. Pursuant to the Purchase Agreement, the closing of the purchase of the i 51% membership interests was $ i 1,800,000, which consisted of $ i 1,250,000 in cash and $ i 550,000 in our restricted common stock to Seller, which amounts to shares of common stock.
On June 1, 2022, we entered into a Purchase Agreement for the purchase of i 51% of the membership interests in Smartbiz, a Florida Corporation which provides telecommunication services, dedicated to VoIP business for wholesale and retail markets. The purchase price for the acquisition was $ i 1,800,000, which consisted of $ i 800,000 in cash and $ i 1,000,000 in our common stock to the seller, which amounts to shares of common stock.
Smartbiz and Whisl have been included in our consolidated results of operations since the acquisition dates.
The following table summarizes the fair value of the consideration paid by the Company:
Whisl
i
| May 13, | |||||
| Fair Value of Consideration: | 2022 | ||||
| Cash | $ | i 1,250,000 | |||
| shares of common stock | i 550,000 | ||||
| Total Purchase Price | $ | i 1,800,000 | |||
Smartbiz
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| June 1, | |||||
| Fair Value of Consideration: | 2022 | ||||
| Cash | $ | i 800,000 | |||
| shares of common stock | i 1,000,000 | ||||
| Total Purchase Price | $ | i 1,800,000 | |||
An additional 754,684 shares of common stock were issued to the seller in December 2022 in accordance with the terms of the purchase agreement.
| F-12 |
The following table summarizes the identifiable assets acquired and liabilities assumed upon acquisition of Smartbiz and Whisl and the calculation of goodwill:
Whisl
i /
Smartbiz
i /
Unaudited combined proforma results of operations for the year ended December 31, 2022 and 2021 as though the Company acquired Smartbiz and Whisl on January 1, 2021, are set forth below:
i| Years Ended | ||||||||
| December 31, | ||||||||
| 2022 | 2021 | |||||||
| Revenues | $ | i 103,353,405 | $ | i 77,483,732 | ||||
| Cost of revenues | i 101,717,011 | i 74,237,359 | ||||||
| Gross profit | i 1,636,394 | i 3,246,373 | ||||||
| Operating expenses | i 5,762,097 | i 6,102,433 | ||||||
| Operating loss | ( i 4,125,703 | ) | ( i 2,856,060 | ) | ||||
| Other expense | ( i 2,674,101 | ) | ( i 880,112 | ) | ||||
| Net Loss | $ | ( i 6,799,804 | ) | $ | ( i 3,736,172 | ) | ||
| F-13 |
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NOTE 5 – PREPAID AND OTHER CURRENT ASSETS
Prepaid and other current assets at December 31, 2022 and 2021 consisted of the following:
i| December 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Subscription receivable | $ | — | $ | i 100,000 | ||||
| Other receivable | i 120,139 | i 143,187 | ||||||
| Prepaid expenses | i 26,600 | i 23,320 | ||||||
| Advance payment | i 21,000 | — | ||||||
| Tax receivable | i 389 | i 603 | ||||||
| Deposit for acquisition of asset | i 357,500 | — | ||||||
| Security deposit | i 20,000 | — | ||||||
| Total prepaid and other current assets | $ | i 545,628 | $ | i 267,110 | ||||
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NOTE 6 – PROPERTY AND EQUIPMENT
Property and equipment at December 31, 2022 and 2021 consisted of the following:
i| December 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Telecommunication equipment | $ | i 317,958 | $ | i 258,871 | ||||
| Telecommunication software | i 640,566 | i 618,125 | ||||||
| Other equipment | i 99,126 | i 108,805 | ||||||
| Total property and equipment | i 1,057,650 | i 985,801 | ||||||
| Accumulated depreciation and amortization | ( i 656,629 | ) | ( i 576,419 | ) | ||||
| Total property and equipment | $ | i 401,021 | $ | i 409,382 | ||||
Depreciation expense for the years ended December 31, 2022 and 2021 amounted to $ i 120,117 and $ i 91,474, respectively.
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NOTE 7 –LOANS PAYABLE
Loans payable at December 31, 2022 and 2021 consisted of the following:
| December 31, | December 31, | Interest | ||||||||||||
| 2022 | 2021 | Term | rate | |||||||||||
| Bridge Loan | $ | — | $ | i 222,222 | i Note was issued on November 1, 2020 and due on January 30, 2022 | i 18.0 | % | |||||||
| Martus | i 94,342 | i 100,634 | i Note was issued on October 23, 2018 and due on January 3, 2023 | i 5.0 | % | |||||||||
| Swisspeers AG | — | i 9,605 | i Note was issued on April 8, 2019 and due on October 4, 2022 | i 7.0 | % | |||||||||
| Darlene Covid19 | i 108,150 | i 109,690 | i Note was issued on April 1, 2020 and due on March 31, 2025 | i 0.0 | % | |||||||||
| Total | i 202,492 | i 442,151 | ||||||||||||
| Less: Unamortized debt discount | — | ( i 7,406 | ) | |||||||||||
| Total loans payable | i 202,492 | i 434,745 | ||||||||||||
| Less: Current portion of loans payable | ( i 94,342 | ) | ( i 315,450 | ) | ||||||||||
| Long-term loans payable | $ | i 108,150 | $ | i 119,295 | ||||||||||
| F-14 |
Loans payable - related parties at December 31, 2022 and 2021 consisted of the following:
i /
During the years ended December 31, 2022 and 2021, the Company borrowed from third parties totaling $ i 0 and $ i 600,000, which includes original issue discount and financing costs of $ i 0 and $ i 66,666 and repaid the principal amount of $ i 232,018 and $ i 344,483, respectively.
During the years ended December 31, 2022 and 2021, the Company recorded interest expense of $ i 22,234 and $ i 191,281 and recognized amortization of discount, included in interest expense, of $ i 7,407 and $ i 78,481, respectively.
During the year ended December 31, 2021, a $ i 1,647,150 (CHF 1,518,909) related party loan was forgiven and the Company recorded it as additional paid in capital.
During the year ended December 31, 2021, the Company settled loans payable of $ i 1,516,667 by issuing shares of common stock valued at $ i 2,056,530. As a result, the Company recorded loss on settlement of debt of $539,863.
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NOTE 8 - CONVERTIBLE LOANS
At December 31, 2022 and 2021, there were no convertible loans.
During the years ended December 31, 2022 and 2021, the Company recorded interest expense of $ i 0 and $ i 33,429 and recognized amortization of discount, included in interest expense, of $ i 0 and $ i 372,290, respectively.
During the years ended December 31, 2022 and 2021, the Company repaid notes of $ i 0 and $ i 250,000 and accrued interest of $ i 0 and $ i 6,027, respectively.
Conversion
During the year ended December 31, 2021, the Company converted notes with principal amounts and accrued interest of $ i 422,295 into shares of common stock. The corresponding derivative liability at the date of conversion of $ i 708,611 was settled through additional paid in capital.
Settlement
During the year ended December 31, 2021, the Company recorded gain on settlement of debt of $11,069.
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NOTE 9 – WARRANTS
On April 5, 2022, we entered into a Common Stock Purchase Option Agreement with Apollo Management Group, Inc (Holder) to subscribe for and purchase from the Company, shares of Common Stock with an exercise price per share of ; and an initial exercisable date on i September 30, 2022. The purchase price of this option was . The Company determined that the warrants had a fixed monetary value with a variable number of shares at inception and categorized the warrants as a liability in the accompanying consolidated financial statements.
| F-15 |
i The Holder and the Company agreed that the Holder had the right and the obligation to exercise, on a cashless basis, $1,000,000 of the Options not later than October 15, 2022. Thereafter, the Holder shall undertake to exercise not less than (i) $ i 400,000 of the Options on a “cash basis” not later than the later of (y) November 14, 2022 or (z) the date on which there is an effective registration statement permitting the issuance of the Option Shares to or resale of the Option Shares by the Holder and (ii) an additional $ i 400,000 of the Options on a “cash basis” not later than the latest of (x) thirty (30) days following the exercise of the Option under subsection (i), above, (y) December 14, 2022, or (z) the date on which there is an effective registration statement permitting the issuance of the Option Shares to or resale of the Option Shares by the Holder. From and after the occurrence of the three above-referenced exercises, each additional exercise of Options hereunder shall be in an amount not less than $200,000 and exercised only on a cash basis. /
i The Holder’s obligation to exercise each specified portion of this option on the specific dates above is subject to the volume-weighted average price (“VWAP”, market value), being not less than $0.20 per share on the relevant option exercise date. Adjusted option shares at VWAP of $0.20 shall be 48,000,000 shares.
A summary of activity regarding warrants issued as follows:
i
| Warrants Outstanding | ||||||||||||
| Weighted Average | Weighted Average Remaining | |||||||||||
| Warrants | Exercise Price | Contractual life (in years) | ||||||||||
| Outstanding, December 31, 2021 | $ | — | ||||||||||
| Granted | i 1.49 | |||||||||||
| Increase in number of warrants by VWAP | i 0.17 | |||||||||||
| Exercised | ( | ) | ||||||||||
| Forfeited/canceled | ||||||||||||
| Outstanding, December 31, 2022 | $ | i 0.75 | ||||||||||
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NOTE 10 – DERIVATIVE LIABILITIES
Fair Value Assumptions Used in Accounting for Derivative Liabilities
ASC 815 requires we assess the fair market value of derivative liabilities at the end of each reporting period and recognize any change in the fair market value as other income or expense.
The Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of December 31, 2022. The Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of warrants is estimated using the Black-Scholes valuation model.
For the years ended December 31, 2022 and 2021, the estimated fair values of the liabilities measured on a recurring basis are as follows:
i
| Years ended | |||||||
| December 31, | |||||||
| 2022 | 2021 | ||||||
| Expected term | i 0.75 – i 1.49 years | i 0.16 - i 1.18 years | |||||
| Expected average volatility | i 83% - i 152% | i 145% - i 241% | |||||
| Expected dividend yield | — | — | |||||
| Risk-free interest rate | - | - | |||||
| F-16 |
The following table summarizes the changes in the derivative liabilities during the years ended December 31, 2022 and 2021:
i
| Fair Value Measurements Using Significant Observable Inputs (Level 3) | |||
| Balance - December 31, 2020 | $ | i 1,025,691 | |
| Settled on issuance of common stock | ( i 708,611 | ) | |
| Change in fair value of the derivative | ( i 317,080 | ) | |
| Balance - December 31, 2021 | $ | — | |
| Addition of new derivatives recognized as cash received | i 500,000 | ||
| Addition of new derivatives recognized as loss on derivatives | i 943,833 | ||
| Settled on issuance of common stock | ( i 1,792,582 | ) | |
| Change in fair value of the warrants | i 1,706,536 | ||
| Balance - December 31, 2022 | $ | i 1,357,787 | |
The following table summarizes the change in fair value of derivative liabilities included in the income statement for the years ended December 31, 2022 and 2021, respectively.
i
| Years ended | ||||||||
| December 31, | ||||||||
| 2022 | 2021 | |||||||
| Addition of new derivatives recognized as loss on derivatives | $ | i 943,833 | $ | — | ||||
| Revaluation of derivative liabilities | i 1,706,536 | ( i 317,080 | ) | |||||
| Change in fair value of derivative liabilities | $ | i 2,650,369 | $ | ( i 317,080 | ) | |||
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NOTE 11 – STOCKHOLDERS’ EQUITY
The Company’s authorized capital consists of shares of common stock with a par value of per share.
Series A Preferred Stock
i On November 3, 2020, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock entitled Series A Preferred Stock, consisting of up shares, par value . Under the Certificate of Designation, holders of Series A Preferred Stock will participate on an equal basis per-share with holders of our common stock in any distribution upon winding up, dissolution, or liquidation. Holders of Series A Preferred Stock are entitled to vote together with the holders of our common stock on all matters submitted to stockholders at a rate of 51% of the total vote of stockholders. /
The rights of the holders of Series A Preferred Stock are defined in the relevant Certificate of Designation filed with the Nevada Secretary of State on November 3, 2020
As of December 31, 2022 and 2021, shares of Series A Preferred Stock were issued and outstanding.
| F-17 |
Series B Preferred Stock
i On November 11, 2020, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock entitled Series B Preferred Stock, consisting of up shares, par value . Under the Certificate of Designation, holders of Series B Preferred Stock will receive a liquidation preference of $81 per share in any distribution upon winding up, dissolution, or liquidation of the Company before junior security holders, as provided in the designation. Holders of Series B Preferred Stock are entitled to receive as, when, and if declared by the Board of Directors, dividends in kind at an annual rate equal to twenty four percent (24%) of $81 per share for each of the then outstanding shares of Series B Preferred Stock, calculated on the basis of a 360-day year consisting of twelve 30-day months. Holders of Series B Preferred Stock do not have voting rights but may convert into common stock after twelve months from the issuance date, at a conversion rate of one thousand (1,000) shares of Common Stock for every one (1) share of Series B Preferred Stock. Upon conversion, the shares are subject to a one-year restriction on sales into the market of no more than 5% previous month’s stock liquidity. /
During the year ended December 31, 2021, shares of common stock were converted into shares of Series B Preferred Stock by our management.
As of December 31, 2022 and 2021, shares of Series B Preferred Stock were issued and outstanding.
Series C Preferred Stock
i On January 7, 2021, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock entitled Series C Preferred Stock, consisting of up shares, par value . Under the Certificate of Designation, holders of Series C Preferred Stock will rank junior to the Series B Preferred Stock, but on par with common stock and Series A Preferred Stock in any distribution upon winding up, dissolution, or liquidation of the company, as provided in the designation. The holders of shares of Series C Preferred Stock have no dividend rights except as may be declared by the Board in its sole and absolute discretion, out of funds legally available for that purpose. Holders of Series C Preferred Stock do not have voting rights but may convert into common stock after twenty four months from the issuance date, at a conversion rate of one thousand (1,000) shares of Common Stock for every one (1) share of Series C Preferred Stock. Upon conversion, the shares are subject to a one-year restriction on sales into the market of no more than 5% previous month’s stock liquidity. /
The rights of the holders of Series C Preferred Stock are defined in the relevant Certificate of Designation filed with the Nevada Secretary of State on January 7, 2021.
As of December 31, 2022 and 2021, Series C Preferred Stock was issued or outstanding.
Common Stock
During the year ended December 31, 2022, the Company issued shares of common stock, valued at fair market value on issuance as follows:
| · | shares issued for cash of $ i 1,000,000 |
| · | shares for acquisitions of Whisl and Smartbiz valued at $ i 1,550,000 |
| · | shares for asset acquisition valued at $ i 357,500 |
| · | shares for compensation to our directors valued at |
| · | shares for settlement of debt valued at $ i 80,674 |
| · | shares for exercise of warrants for $ i 400,000 |
During the year ended December 31, 2021, the Company issued shares of common stock, valued at fair market value on issuance as follows;
| · | shares issued for cash of $ i 6,536,250, of which $ i 100,000 was recorded as subscription receivable as of December 31, 2021. The Company received the on January 3, 2022. |
| · | shares, valued at $ i 2,056,530, issued for settlement of debt of $ i 1,516,667 |
| · | shares for services valued at $ i 284,700 |
| · | shares issued to our management for compensation valued at |
| · | shares for forbearance of debt valued at $ i 49,925 |
| · | shares issued for conversion of debt of $ i 422,295 |
During the year ended December 31, 2021, the Company terminated a placement agent and advisory services agreement with a FINRA member dated September 22, 2020, and cancelled shares of common stock, which was issued for those services. The termination agreement allowed the FINRA member to retain i 400,000 shares of the Company’s common stock in connection with the services.
As of December 31, 2022 and 2021, and shares of common stock were issued and outstanding, respectively.
| F-18 |
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NOTE 12 – PROVISION FOR INCOME TAXES
The Company provides for income taxes under ASC 740, “Income Taxes.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax basis of assets and liabilities and the tax rates in effect when these differences are expected to reverse. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.
The components of the Company’s deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income tax amount recorded as of December 31, 2022 and 2021, are as follows:
i| December 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Net Operating loss carryforward | $ | i 15,540,294 | $ | i 12,332,310 | ||||
| Effective tax rate | i 21 | % | i 21 | % | ||||
| Deferred tax asset | i 3,263,462 | i 2,589,785 | ||||||
| Foreign taxes | ( i 7,118 | ) | ( i 7,242 | ) | ||||
| Less: valuation allowance | ( i 2,816,209 | ) | ( i 2,136,141 | ) | ||||
| Net deferred tax asset | $ | i 440,135 | $ | i 446,402 | ||||
As of December 31, 2022, the Company has approximately $ i 15,540,000 of net operating losses (“NOL”) generated to December 31, 2022 carried forward to offset taxable income in future years which expire commencing in fiscal 2022. NOLs generated in the United States for tax years prior to December 31, 2017, can be carried forward for twenty years, whereas NOLs generated after December 31, 2017 can be carried forward indefinitely in USA, and can be carried forward for 7 years in Switzerland. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the assessment, management has established a full valuation allowance against all of the deferred tax assets relating to NOLs for every period because it is more likely than not that all of the deferred tax assets will not be realized other than those recorded at SwissLink, because the Company anticipates utilizing the NOLs prior to their expiration.
Utilization of the NOL carry forwards may be subject to an annual limitation due to ownership change limitations that may have occurred or that could occur in the future, as required by Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”). These ownership changes may limit the amount of the NOL carry forwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an “ownership change” as defined by Section 382 of the Code results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain stockholders.
Tax returns for the years ended 2016 through 2022 are subject to review by the tax authorities.
/ i
NOTE 13 - RELATED PARTY TRANSACTIONS
Due from related party
During the year ended December 31, 2021, the Company loaned $ i 220,674 to our CEO and applied to due to CEO of $ i 8,004.
During the year ended December 31, 2021, the Company wrote off due from related party of $ i 10,148.
During the years ended December 31, 2022 and 2021, the Company loaned $ i 1,000 and $ i 220,674 to a related party and collected $ i 700 and $ i 226, respectively.
As of December 31, 2022 and 2021, the Company had due from related parties of $ i 326,324 and $ i 424,086, respectively. The loans are unsecured, non-interest bearing and due on demand.
| F-19 |
Due to related parties
During the years ended December 31, 2022 and 2021, the Company repaid $ i 0 and $ i 90,787, respectively, to the CEO and CFO of the Company.
As of December 31, 2022 and 2021, the Company had amounts due to related parties of $ i i 26,613 / . The amounts are unsecured, non-interest bearing and due on demand.
Debt to Equity Swap
During the year ended December 31, 2021 the Company recorded a debt to equity swap of $ i 1,647,150 as additional paid in capital.
Employment agreements
During the years ended December 31, 2022 and 2021, the Company recorded management salaries of $ i 576,000 and $ i 558,000, respectively, and stock-based compensation bonuses of and , respectively.
As of December 31, 2022 and 2021, the Company recorded and accrued management salaries of $ i 79,628 and $ i 92,229, respectively.
/ i
NOTE 14 – COMMITMENTS AND CONTINGENCIES
Leases and Long-term Contracts
The Company has not entered into any long-term leases, contracts or commitments. The Company leases facilities which the term is i 12 months. For the years ended December 31, 2022 and 2021, the Company incurred rent expense of $ i 73,865 and $ i 37,823, respectively.
Advisory service
On March 3, 2020, we appointed Oscar Brito as an advisor to our Board of Directors and agreed to pay him $ i 5,000 per month for such services. Mr. Brito acted as an advisor to our Board of Directors. On February 11, 2021, the Company paid $ i 12,600 and the service was terminated.
On January 4, 2021, the Company terminated a placement agent and advisory services agreement with a FINRA member dated September 22, 2020, and cancelled shares of common stock, which was issued for those services. The termination agreement allowed the FINRA member to retain i 400,000 shares of the Company’s common stock in connection with the services.
/ i
NOTE 15 - SEGMENT
At December 31, 2022 and 2021, the Company operates in one industry segment, telecommunication services, and two geographic segments, USA and Switzerland, where current assets and equipment are located.
Operating Activities
The following table shows operating activities information by geographic segment for the years ended December 31, 2022 and 2021:
i
| F-20 |
Year ended December 31, 2022
NOTE 15 - SEGMENT - Schedule of Operating Activities by Geographic Segment
Year ended December 31, 2021
Asset Information
The following table shows asset information by geographic segment as of December 31, 2022 and 2021:
| December 31, 2022 | USA | Switzerland | Elimination | Total | ||||||||||||
| Assets | ||||||||||||||||
| Current assets | $ | i 6,496,354 | $ | i 1,172,889 | $ | ( i 1,232,653 | ) | $ | i 6,436,590 | |||||||
| Non-current assets | $ | i 11,646,662 | $ | i 650,794 | $ | ( i 6,184,562 | ) | $ | i 6,112,894 | |||||||
| Liabilities | ||||||||||||||||
| Current liabilities | $ | i 5,967,729 | $ | i 1,716,603 | $ | ( i 1,232,653 | ) | $ | i 6,451,679 | |||||||
| Non-current liabilities | $ | — | $ | i 262,388 | $ | — | $ | i 262,388 | ||||||||
| December 31, 2021 | USA | Switzerland | Elimination | Total | ||||||||||||
| Assets | ||||||||||||||||
| Current assets | $ | i 5,783,859 | $ | i 997,216 | $ | ( i 214,551 | ) | $ | i 6,566,524 | |||||||
| Non-current assets | $ | i 4,468,491 | $ | i 609,189 | $ | ( i 2,584,562 | ) | $ | i 2,493,118 | |||||||
| Liabilities | ||||||||||||||||
| Current liabilities | $ | i 1,070,972 | $ | i 1,506,594 | $ | ( i 214,551 | ) | $ | i 2,363,015 | |||||||
| Non-current liabilities | $ | — | $ | i 275,729 | $ | — | $ | i 275,729 | ||||||||
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NOTE 16 – SUBSEQUENT EVENTS.
Subsequent to December 31, 2022 and through the date that these financials were made available, the Company had the following subsequent events:
Subsequent to December 31, 2022, the Company issued i 2,941,177 shares for exercise of warrants and received .
/
| F-21 |
Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
There were no changes or disagreements with our accountants on accounting and financial disclosure.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
As required by Rule 13a-15 under the Securities Exchange Act of 1934, we have carried out an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this annual report, being December 31, 2022. This evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer.
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our company’s reports filed under the Securities Exchange Act of 1934 is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Based upon that evaluation, including our Chief Executive Officer and Chief Financial Officer, we have concluded that our disclosure controls and procedures were ineffective as of the end of the period covered by this annual report.
Management’s Annual Report on Internal Control over Financing Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934). Management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2022 based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. As a result of this assessment, management concluded that, as of December 31, 2022, our internal control over financial reporting was not effective. Our management identified the following material weaknesses in our internal control over financial reporting, which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines.
We plan to take steps to enhance and improve the design of our internal control over financial reporting. During the period covered by this annual report on Form 10-K, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we hope to implement the following changes during our fiscal year ending December 31, 2023: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out in (i) and (ii) are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.
This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our independent registered public accounting firm pursuant to an exemption for non-accelerated filers set forth in Section 989G of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
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Inherent Limitations
Our management, including our Chief Executive Officer and Chief Financial Officer, do not expect that our disclosure controls and procedures will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdown can occur because of simple error or mistake. In particular, many of our current processes rely upon manual reviews and processes to ensure that neither human error nor system weakness has resulted in erroneous reporting of financial data.
Changes in Internal Controls over Financial Reporting
There were no changes in our internal control over financial reporting during the three month period ended December 31, 2022, which were identified in conjunction with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting..
None
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
None
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PART III
Item 10. Directors, Executive Officers and Corporate Governance
The following information sets forth the names, ages, and positions of our current directors and executive officers.
| Name | Age | Positions and Offices Held | ||||
| Leandro Iglesias | 58 | President, Chairman, Chief Executive Officer and Director | ||||
| Alvaro Quintana Cardona | 52 | Chief Operating Officer, Chief Financial Officer and Director | ||||
| Juan Carlos Lopez Silva | 56 | Chief Commercial Officer | ||||
| Raul Perez | 72 | Director | ||||
| Jose Antonio Barreto | 64 | Director | ||||
| Italo Segnini | 58 | Director | ||||
Set forth below is a brief description of the background and business experience of each of our current executive officers and directors.
Before founding Etelix in year 2008, where he has acted as President and CEO, Mr. Iglesias was the International Business Manager at CANTV/Movilnet (the Venezuelan biggest telecommunications services provider). He held this position between January 2003 and July 2008, while the company was under the control of Verizon. Previous to his position in Cantv/Movilnet Mr. Iglesias was Executive Vice President and responsible of the Latin America marketing division of American Internet Communications (August 1998 – December 2002). Leandro Iglesias has developed a career for more than 20 years in the telecommunications industry with a particular emphasis in the international long-distance traffic business, submarine cables, satellite communications and international roaming services. He is Electronic Engineer graduate from Universidad Simon Bolivar and graduated from the Management Program at IESA Business School. He also holds an MBA from Universidad Nororiental Gran Mariscal de Ayacucho.
Aside from that provided above, Mr. Iglesias does not hold and has not held over the past five years any other directorships in any company with a class of securities registered pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940.
We believe that Mr. Iglesias is qualified to serve on our Board of Directors because of his wealth of experience in the telecom industry.
Alvaro Quintana has developed a career of more than twenty years of experience in the telecommunication industry with particular focus on regulatory affairs, strategic planning, value added services and international interconnection agreements. Before joining Etelix in year 2013 as Chief Operation Officer and Chief Financial Officer, Mr. Quintana acted between June 2004 and May 2013 as Interconnection and Value-Added Services Manager at Digitel (a mobile service provider in Venezuela, formerly a Telecom Italia Mobile subsidiary). He holds a Bachelor Degree in Business Administration and a Specialist Degree in Economics, both from the Universidad Catolica Andres Bello. He also holds a Master in Telecommunications from the EOI Business School in Spain.
Aside from that provided above, Mr. Cardona does not hold and has not held over the past five years any other directorships in any company with a class of securities registered pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940.
We believe that Mr. Quintana is qualified to serve on our Board of Directors because of his wealth of experience in the telecom industry.
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Juan Carlos Lopez Silva
Juan Carlos Lopez Silva is an Engineer graduated from Universidad de Los Andes, with a Master degree in Project Management from the Pontificia Universidad Javeriana; and MBA from EADA Business School; with more than 20 years of experience in project management, negotiation, business development and management on international companies. Previous to joining Etelix in August 2011 as Chief Commercial Officer, Juan Carlos was International Carrier Relations Manager at Colombia Telecomunicaciones S.A. Esp. a subsidiary of Telefonica of Spain, between September 2003 and June 2011.
Aside from that provided above, Mr. Silva does not hold and has not held over the past five years any other directorships in any company with a class of securities registered pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940.
Raul A Perez
From December 1, 2014 to present, Mr. Perez serves as CFO of Deerbrook Family Dentistry, PC, Dental Practice in Humble, Texas. From November 1, 2017 to January 31, 2019, he served as Senior Accountant to Principrin School, PC, Day Care in Houston, Texas.
Mr. Perez has been in finance for more than 40 years, starting in 1970 as analyst in treasury and finance departments and progressively assuming different positions up to corporate treasurer for large corporations. He served for Sudamtex of Venezuela, C.A for 5 years and Polar Brewery in Caracas, Venezuela for 10 year. Beginning in 2000, he accepted a position as a Director of the Security and Exchange Commission of Venezuela to have the surveillance of Venezuelan stock market participants. Also, in 2004 he completed the requirements and received his certification as a Venezuelan Investment Advisor. Later, as an independent contractor for three years, he was selected as the Corporate Compliance Officer for an especially important stock market broker dealer in Venezuela, Activalores Casa de Bolsa, in which he developed the Compliance Unit and manuals required by local and international anti money laundering laws. He also taught Advanced Institute of Finance (IAF) in Caracas being a professor of Corporate Finance and Managerial Accounting for 5 years.
Mr. Perez has a Bachelor’s degree in accounting (1976), and MBA Finance (1982), gave me the overall knowledge of finance and how to plan, start up, run, and control a business.
We have selected Mr. Perez to serve as an independent director because of his education, skills and experience in finance and his regulatory history.
Jose Antonio Barreto
From 2006 to the present, Mr. Barreto has been Chief Business Development Officer of Xpectra Remote Management / Mexico. There he was in charge of directing all aspects of account development and sales effort to close specific private and government opportunities and developing strategic accounts in Mexico and the LATAM region. From 2020 to present, he has been an advisor to our Board of Directors.
Mr. Barreto has more than 30 years of experience working in telecommunications and technology companies. He has been directly responsible of leading the business development and operational in several telecommunication and technology companies’ acquisition activity, with the responsibility of leading the technical, operation and financial analysis. Over the last 14 years, Jose Antonio has been the North and Central American leader, spanning from Mexico to Panama, in the development of commercial processes in the technology security field, artificial intelligence, Internet of Things (IoT) platforms, as well as cutting edge technology solutions and software systems.
He studied Electronic Engineering at the Universidad Simón Bolivar followed by a Master of Science Degree in Electrical and Computer Engineering at Rice University. He also completed the Master in Telecommunications Management offered by Universidad Simon Bolivar and the Telecom SudParis Institute.
We have selected Mr. Barreto to serve as an independent director because of his education, skills and experience in technology companies.
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Italo R. Segnini
From March 2020 to the present, Mr. Segnini has been serving as Global Carrier Partnership Director of Sierra Wireless. From June 2019 to February 2020, he served as an Independent Telecom Consultant. From 2017 to 2019, he served as Director of International Carrier Business for Televisa Telecom. From 2012 to 2019, he served as Director International Carrier Business for Millicom.
Mr. Segnini is a long time Telecommunicaction industry professional who has had high level positions at Global Tier Ones for more than 20 years, Telefonica, Millicon and Televisa, Sierra Wireless to mention a few. Mr. Segnini has extensive executive experience in the Telecom areas like Voice, A2P, SMS, Data, Roaming, Mobility Services, B2B, MNO, MVNO, IoT, Interconnection, etc., and a solid business performance record spanning multiple functions including International commercial negotiations, management, sales, business development, sales, regulatory and operations. Italo R. Segnini holds a Juris Doctor degree from the Andres Bello Catholic University, a Telecommunication Masters Degree from Madrid Pontificia Comillas University and an MBA from IESA Business School
Term of Office
Our Directors are appointed for a one-year term to hold office until the next annual general meeting of our stockholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board, subject to their respective employment agreements.
Significant Employees
We have no significant employees other than our officers and directors.
Family Relationships
There are no family relationships between or among the directors, executive officers or persons nominated or chosen by us to become directors or executive officers.
Involvement in Certain Legal Proceedings
During the past 10 years, none of our current directors, nominees for directors or current executive officers has been involved in any legal proceeding identified in Item 401(f) of Regulation S-K, including:
1. Any petition under the Federal bankruptcy laws or any state insolvency law filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he or she was a general partner at or within two years before the time of such filing, or any corporation or business association of which he or she was an executive officer at or within two years before the time of such filing;
2. Any conviction in a criminal proceeding or being named a subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);
3. Being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him or her from, or otherwise limiting, the following activities:
i. Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;
ii. Engaging in any type of business practice; or
iii. Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws;
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4. Being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any type of business regulated by the Commodity Futures Trading Commission, securities, investment, insurance or banking activities, or to be associated with persons engaged in any such activity;
5. Being found by a court of competent jurisdiction in a civil action or by the SEC to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;
6. Being found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;
7. Being subject to, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:
i. Any Federal or State securities or commodities law or regulation; or
ii. Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or
iii. Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
8. Being subject to, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
Director Independence
The Board of Directors reviews the independence of our directors on the basis of standards adopted by the NASDAQ Stock Market (“NASDAQ”). As a part of this review, the Board of Directors considers transactions and relationships between our company, on the one hand, and each director, members of the director’s immediate family, and other entities with which the director is affiliated, on the other hand. The purpose of such a review is to determine which, if any, of such transactions or relationships were inconsistent with a determination that the director is independent under NASDAQ rules. As a result of this review, the Board of Directors has determined that none of our directors is an “independent director” within the meaning of applicable NASDAQ listing standards.
Committees of the Board
Our full board serves the functions that would normally be served by a separately-designated Nominating Committee, and.
Company has an Audit Committee with a financial expert on the Board and a majority of independent members.
Company has a Compensation Committee with a majority of independent members.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our directors and executive officers and persons who beneficially own more than ten percent of a registered class of the Company’s equity securities to file with the SEC initial reports of ownership and reports of changes in ownership of common stock and other equity securities of the Company. Officers, directors and greater than ten percent beneficial stockholders are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. To the best of our knowledge based solely on a review of Forms 3, 4, and 5 (and any amendments thereof) received by us, no persons have failed to file, on a timely basis, the identified reports required by Section 16(a) of the Exchange Act during fiscal year ended December 31, 2022. Following the year end, all of the Form 3s were filed late for incoming management of Etelix.com USA LLC.
Code of Ethics
Company has a code of ethics.
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Item 11. Executive Compensation
The table below summarizes all compensation awarded to, earned by, or paid to our former or current executive officers for the fiscal years ended December 31, 2022 and 2021.
|
Name and principal Position |
Year | Salary ($) |
Bonus ($) |
Stock Awards ($) |
Option Awards ($) |
All Other Compensation ($) (1)(2) |
Total ($) |
|
President, CEO and Director |
2022 2021 |
204,000 174,000 |
- 419,024 |
- - |
- - |
- - |
204,000 593,024 |
|
Alvaro Quintana Treasury, Secretary and Director |
2022 2021 |
144,000 159,088 |
- 337,674 |
- - |
- - |
- - |
144,000 496,762 |
|
Juan Carlos López Chief Commercial Officer |
2022 2021 |
120,000 80,000 |
- 244,050 |
- - |
- - |
- - |
120,000 324,050 |
On May 2, 2019, the Company entered into Employment Agreements with the following persons: (i) Leandro Iglesias as President, CEO and Chairperson of the Company’s Board of Directors with an annual salary of $168,000 with an annual bonus of 3% of our net income; (ii) Juan Carlos Lopez Silva as Chief Commercial Officer with an annual salary of $120,000 with an annual bonus of 3% of our net income; and Alvaro Quintana Cardona as Chief Operating Officer and Chief Financial Officer with an annual salary of $144,000 with an annual bonus of 3% of our net income. The Employment Agreements have a term of 36 months, are renewable automatically for 24-month periods, unless the Company gives written notice at least 90 days prior to termination of the initial 36-month term. The Company shall have the right to terminate any of the employment agreements at any time without prior notice, but in that event, the Company shall pay these persons salaries and other benefits they are entitled to receive under their respective agreements for three years. The above executive officers agreed to two year non-compete and non-solicit restrictive covenants with the Company. If any of the executive officers are terminated for cause they shall forfeit any rights to severance.
On November 1, 2020, our board of directors approved amended employments in favor of our Chief Executive Officer, Leandro Iglesias, our Chief Financial Officer, Alvaro Quintana, and our Chief Commercial Officer, Juan Carlos Lopez Silva.
The amended employment agreement in favor of Mr. Iglesias extended the term of employment from 36 months to 60 months. The now five year employment agreement with Mr. Iglesias provides that we will compensate him with a salary of $17,000 monthly and he is eligible for quarterly bonus of 250,000 shares of our common stock. If we do not have the cash available, the agreement provides that Mr. Iglesias may convert his accrued salary/bonus into shares of our common stock or newly created Series A Preferred Stock. For common shares, the amount of accrued salary to be converted into shares must be determined by considering the average price per share of the Company’s common stock on the OTC Markets during the last 10 days and applying a discount of 25%.” For Series A Preferred Shares, the amount of accrued salary to be converted into shares is the per share conversion price for common shares multiplied by ten US Dollars ($10). Mr. Iglesias has a further right to convert any common shares under his control into Series A Preferred shares at any time at a rate of ten (10) common shares for each Series A Preferred share.
The amended employment agreement in favor of Mr. Quintana extended the term of employment from 36 months to 60 months. The now five year employment agreement with Mr. Quintana provides that he is eligible for quarterly bonus of 200,000 shares of our common stock. If we do not have the cash available, the agreement provides that Mr. Quintana may convert his accrued salary/bonus into shares of our common stock or newly created Series A Preferred Stock. For common shares, the amount of accrued salary to be converted into shares must be determined by considering the average price per share of the Company’s common stock on the OTC Markets during the last 10 days and applying a discount of 25%.” For Series A Preferred Shares, the amount of accrued salary to be converted into shares is the per share conversion price for common shares multiplied by ten US Dollars ($10). Mr. Quintana has a further right to convert any common shares under his control into Series A Preferred shares at any time at a rate of ten (10) common shares for each Series A Preferred share.
The amended employment agreement in favor of Mr. Silva extended the term of employment from 36 months to 60 months. Mr. Silva is eligible for quarterly bonuses of 150,000 shares of our common stock. If we do not have the cash available, the agreement provides that Mr. Iglesias may convert his accrued salary/bonus into shares of our common stock at the average price of our common stock during the last 10 days after applying a discount of 25%.
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Option Grants
We have not granted any options or stock appreciation rights to our named executive officers or directors since inception. We do not have any stock option plans.
Compensation of Directors
All Directors shall receive reimbursement for reasonable travel expenses incurred to attend Board and committee meetings.
Effective on July 1, 2021 and thereafter, all Directors shall be compensated monthly up to 4,000 shares of common stock cash of $1,000 for their service as Directors. The Chairman and Secretary of the Board shall receive an additional $2,000 per month in addition to the Director compensation.
In lieu of the cash compensation set forth above, each Director may elect to receive shares of the Corporation's Common Stock equal to the total cash compensation divided by the average market value of the Company's Common Stock during the last 10 trading days and applying a discount of 25%.
Pension, Retirement or Similar Benefit Plans
There are no arrangements or plans in which we provide pension, retirement or similar benefits to our directors or executive officers. We have no material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at the discretion of the board of directors or a committee thereof.
Compensation Committee
The Company have a compensation committee of the board of directors. This committee is constituted by independent members of the Board and participates in the consideration of executive officer and director compensation.
Indebtedness of Directors, Senior Officers, Executive Officers and Other Management
None of our directors or executive officers or any associate or affiliate of our company during the last two fiscal years is or has been indebted to our company by way of guarantee, support agreement, letter of credit or other similar agreement or understanding currently outstanding.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table sets forth, as of March 24, 2022, certain information as to shares of our voting stock owned by (i) each person known by us to beneficially own more than 5% of our outstanding voting stock, (ii) each of our directors, and (iii) all of our executive officers and directors as a group.
Unless otherwise indicated below, to our knowledge, all persons listed below have sole voting and investment power with respect to their shares of voting stock, except to the extent authority is shared by spouses under applicable law. Unless otherwise indicated below, each entity or person listed below maintains an address of 300 Aragon Avenue, Suite 375, Coral Gables, FL 33134.
The number of shares beneficially owned by each stockholder is determined under rules promulgated by the SEC. The information is not necessarily indicative of beneficial ownership for any other purpose. Under these rules, beneficial ownership includes any shares as to which the individual or entity has sole or shared voting or investment power and any shares as to which the individual or entity has the right to acquire beneficial ownership within 60 days through the exercise of any stock option, warrant or other right. The inclusion in the following table of those shares, however, does not constitute an admission that the named stockholder is a direct or indirect beneficial owner.
| 26 |
| Common Stock | ||||||||
| Name of Beneficial Owner |
Number of Shares Owned (1) |
Percent of Class (2) | ||||||
| Leandro Iglesias | 542,932 | 0.3307 | % | |||||
| Alvaro Quintana Cardona | 1,121,842 | 0.6833 | % | |||||
| Juan Carlos Lopez Silva | 925,497 | 0.5637 | % | |||||
| Raul Perez | 8,000 | 0.005 | % | |||||
| Jose Antonio Barreto | 8,000 | 0.005 | % | |||||
| Italo Segnini | 8,000 | 0.005 | % | |||||
| All Directors and Executive Officers as a Group (6 persons) | 2,614,271 | 1.5924 | % | |||||
| Series A Preferred Stock | ||||||||
| Name of Beneficial Owner |
Number of Shares Owned (1) |
Percent of Class (3) |
||||||
| Leandro Iglesias | 7,000 | 70.00 | % | |||||
| Alvaro Quintana Cardona | 3,000 | 30.00 | % | |||||
| Juan Carlos Lopez Silva | — | — | ||||||
| Raul Perez | — | — | ||||||
| Jose Antonio Barreto | — | — | ||||||
| Italo Segnini | — | — | ||||||
| All Directors and Executive Officers as a Group (6 persons) | 10,000 | 100.00 | % | |||||
(1) Unless otherwise indicated, each person or entity named in the table has sole voting power and investment power (or shares that power with that person’s spouse) with respect to all shares of voting stock listed as owned by that person or entity.
(2) Pursuant to Rules 13d-3 and 13d-5 of the Exchange Act, beneficial ownership includes any shares as to which a shareholder has sole or shared voting power or investment power, and also any shares which the shareholder has the right to acquire within 60 days, including upon exercise of common shares purchase options or warrants. The percent of class is based on 164,176,688 voting shares as of April 10, 2023.
(3) Pursuant to Rules 13d-3 and 13d-5 of the Exchange Act, beneficial ownership includes any shares as to which a shareholder has sole or shared voting power or investment power, and also any shares which the shareholder has the right to acquire within 60 days, including upon exercise of common shares purchase options or warrants. The percent of class is based on 10,000 voting shares as of April 10, 2023.
| 27 |
Item 13. Certain Relationships and Related Transactions, and Director Independence
Other than described below or the transactions described under the heading “Executive Compensation” (or with respect to which such information is omitted in accordance with SEC regulations), there have not been, and there is not currently proposed, any transaction or series of similar transactions to which we were or will be a participant in which the amount involved exceeded or will exceed the lesser of $120,000 or one percent of the average of our total assets at year-end for the last two completed fiscal years, and in which any director, executive officer, holder of 5% or more of any class of our capital stock or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest.
Due from related party
During the years ended December 31, 2022 and 2021, the Company loaned $1,000 and $220,674 to a related party and collected $700 and $226, respectively.
As of December 31, 2022 and 2021, the Company had due from related parties of $326,324 and $424,086, respectively. The loans are unsecured, non-interest bearing and due on demand.
Due to related parties
During the years ended December 31, 2022 and 2021, the Company repaid $0 and $90,787, respectively, to the CEO and CFO of the Company.
As of December 31, 2022 and 2021, the Company had amounts due to related parties of $26,613. The amounts are unsecured, non-interest bearing and due on demand.
Dept to Equity Swap
During the year ended December 31, 2021 the Company recorded a debt-to-equity swap to a related party of $1,647,150 as additional paid in capital.
Item 14. Principal Accounting Fees and Services
Below are tables of Audit Fees (amounts in US$) billed by our auditors in connection with the audits of the Company’s annual financial statements for the years ended:
| Financial Statements for the Year Ended December 31 |
Audit Services | Audit Related Fees | Tax Fees | Other Fees | |||||||||||||
| 2021 | $ | 136,297 | $ | 29,500 | $ | 0 | $ | 0 | |||||||||
| 2022 | $ | 180,710 | $ | 1,717 | $ | 0 | $ | 0 | |||||||||
| 28 |
PART IV
Item 15. Exhibits, Financial Statements Schedules
| (a) Financial Statements and Schedules |
The following financial statements and schedules listed below are included in this Form 10-K.
Financial Statements (See Item 8)
| (b) Exhibits |
| 1. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on June 28, 2018. | |
| 2. | Incorporated by reference to the Company’s Registration Statement on Form S-1 filed with the US Securities and Exchange Commission on August 18, 2011. | |
| 3. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on August 31, 2018. | |
| 4. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on March 30, 2020. | |
| 5. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on February 25, 2020. | |
| 6. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on February 19, 2020. | |
| 7. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on February 13, 2020. | |
| 8. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on January 6, 2020. | |
| 9. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on December 11, 2019. | |
| 10. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on May 6, 2019. | |
| 11. | Incorporated by reference to the Company’s Form 8-K filed with the US Securities and Exchange Commission on April 4, 2019. |
None
| 29 |
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| IQSTEL Inc. | |
| By: | /s/ Leandro Iglesias |
|
Chief Executive Officer, Principal Executive Officer | |
| April 14, 2023 |
| By: | /s/ Alvaro Quintana Cardona |
| Alvaro Quintana Cardona | |
| Title: | Chief Operating Officer, Chief Financial Officer, Principal Financial Officer and Principal Accounting Officer |
| Date: | April 14, 2023 |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By: | /s/ Leandro Iglesias |
|
Chief Executive Officer, Principal Executive Officer | |
| April 14, 2023 |
| By: | /s/ Alvaro Quintana Cardona |
| Alvaro Quintana Cardona | |
| Title: | Chief Operating Officer, Chief Financial Officer, Principal Financial Officer and Principal Accounting Officer |
| Date: | April 14, 2023 |
| 30 |
| This ‘10-K’ Filing | Date | Other Filings | ||
|---|---|---|---|---|
 | ||||
| 3/31/25 | ||||
| 12/31/23 | ||||
| 12/15/23 | ||||
| Filed on: | 4/14/23 | |||
| 4/10/23 | ||||
| 1/3/23 | ||||
| For Period end: | 12/31/22 | NT 10-K | ||
| 12/15/22 | ||||
| 12/14/22 | 8-K | |||
| 11/14/22 | 10-Q, 8-K | |||
| 10/15/22 | ||||
| 10/4/22 | ||||
| 9/30/22 | 10-Q | |||
| 6/30/22 | 10-Q | |||
| 6/1/22 | ||||
| 5/13/22 | 8-K | |||
| 4/5/22 | ||||
| 3/31/22 | 10-Q, NT 10-K | |||
| 3/24/22 | ||||
| 1/30/22 | ||||
| 1/3/22 | ||||
| 12/31/21 | 10-K, NT 10-K | |||
| 10/1/21 | ||||
| 9/30/21 | 10-Q, 8-K | |||
| 7/1/21 | ||||
| 6/30/21 | 10-Q | |||
| 3/31/21 | 10-Q, NT 10-K | |||
| 2/11/21 | ||||
| 1/7/21 | 8-K | |||
| 1/4/21 | 8-K | |||
| 1/1/21 | ||||
| 12/31/20 | 10-K, NT 10-K | |||
| 11/12/20 | 8-K | |||
| 11/11/20 | 8-K | |||
| 11/3/20 | 8-K | |||
| 11/1/20 | 8-K | |||
| 9/22/20 | ||||
| 4/15/20 | 10-K, 8-K | |||
| 4/1/20 | ||||
| 3/30/20 | 253G3, 8-K | |||
| 3/11/20 | ||||
| 3/3/20 | ||||
| 2/25/20 | 8-K | |||
| 2/21/20 | 8-K | |||
| 2/19/20 | 8-K | |||
| 2/13/20 | 8-K | |||
| 2/10/20 | ||||
| 1/6/20 | 8-K | |||
| 12/11/19 | 8-K, CORRESP | |||
| 5/6/19 | 8-K | |||
| 5/2/19 | ||||
| 4/8/19 | ||||
| 4/4/19 | 8-K, UPLOAD | |||
| 4/1/19 | 8-K | |||
| 1/31/19 | ||||
| 10/23/18 | ||||
| 8/31/18 | 8-K | |||
| 8/30/18 | 8-K | |||
| 8/7/18 | ||||
| 6/28/18 | 8-K | |||
| 6/25/18 | 8-K | |||
| 12/31/17 | 10-Q, NT 10-Q | |||
| 11/1/17 | ||||
| 3/8/17 | ||||
| 9/18/15 | ||||
| 12/1/14 | ||||
| 8/18/11 | S-1 | |||
| 6/24/11 | ||||
| List all Filings | ||||
As Of Filer Filing For·On·As Docs:Size Issuer Filing Agent 3/30/20 iQSTEL Inc. 8-K:1,2,5,8 3/02/19 4:9.1M Action Edgar Fil… Svc/FA 2/25/20 iQSTEL Inc. 8-K:1,2,8,9 2/21/20 3:6.3M Action Edgar Fil… Svc/FA 2/19/20 iQSTEL Inc. 8-K:1,2,8,9 2/19/20 3:7.8M Action Edgar Fil… Svc/FA 2/13/20 iQSTEL Inc. 8-K:1,2,9 2/11/20 2:2.3M Action Edgar Fil… Svc/FA 1/06/20 iQSTEL Inc. 8-K:1,2,8,912/12/19 12:13M Action Edgar Fil… Svc/FA 12/11/19 iQSTEL Inc. 8-K:1,2,9 12/11/19 3:59M Action Edgar Fil… Svc/FA 5/06/19 iQSTEL Inc. 8-K:1,5,9 5/03/19 5:23M Action Edgar Fil… Svc/FA 4/04/19 iQSTEL Inc. 8-K:1,9 4/01/19 2:8.1M Action Edgar Fil… Svc/FA 8/31/18 iQSTEL Inc. 8-K:5,9 8/30/18 2:692K Action Edgar Fil… Svc/FA 6/28/18 iQSTEL Inc. 8-K:1,2,3,5 6/25/18 8:35M Action Edgar Fil… Svc/FA 8/18/11 iQSTEL Inc. S-1 8/17/11 10:937K Action Edgar Fil… Svc/FA |