Business Context and Reporting Period
This Form 8-K filing by iQSTEL Inc. (Nasdaq: IQST) reports on events occurring on June 4, 2025, and June 6, 2025, with the report dated June 6, 2025. The filing addresses Item 3.02 regarding unregistered sales of equity securities.
Key Financial Metrics
The filing does not provide comprehensive financial statements, revenue, profit, cash flow, or margin data. Specific metrics related to the debt conversion event include:
- Notes Converted: $1,111,111.12 of principal and $90,277.78 of accrued interest.
- Shares Issued: 286,640 shares of common stock.
- Conversion Price: $4.20 per share (adjusted for a 1-for-80 reverse stock split).
- Remaining Debt: $2,690,058 principal and $189,093 accrued interest.
- Total Original Note Value: Increased to $5,000,000 in December 2024.
Material Changes
The primary material change is the partial conversion of secured convertible promissory notes into common stock. This transaction reduces the company's outstanding debt principal and accrued interest while increasing the number of outstanding shares. The conversion price reflects adjustments made following a 1-for-80 reverse stock split effected on May 2, 2025.
Guidance, Outlook, and Risks
The filing contains no forward-looking guidance, management commentary on future operations, or specific risk factors beyond the terms of the note conversion. Key contingencies include:
- Beneficial Ownership Limitation: Further conversion of the remaining debt is subject to a 9.99% beneficial ownership limitation based on shares outstanding immediately after the conversion.
- Exemption Reliance: The shares were issued under Section 3(a)(9) of the Securities Act of 1933.
Investor Verification Checklist
- Verify the total number of shares outstanding post-conversion to assess the 9.99% beneficial ownership cap on remaining debt.
- Confirm the impact of the 1-for-80 reverse stock split on historical share counts and per-share metrics.
- Review the full terms of the secured convertible promissory notes to understand interest accrual rates and maturity dates.
- Check subsequent filings for any further conversions or changes to the remaining $2.69 million principal balance.