ITEM 1.01 - ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On February 12, 2020, we entered into a Memorandum of Understanding and Shareholders Agreement with Jesus Vega and our officer and director, Leandro Iglesias. The agreement concerns the formation of a joint venture named QGLOBAL SMS, LLC for the development of the wholesale SMS business.
Under the agreement, Mr. Vega will contribute to the joint venture by developing the international SMS business in the areas of wholesale and retail (person to person (PSP) and application to person (A2P)) as well as the sale of such services internationally. Mr. Vega will also contribute the entire volume of sales in the SMS business that he has in a company that he owns. He will assign all contracts with suppliers and customers, the lease contract for the Interconnection platform, as well as the personnel currently working in the aforementioned company. His current business has a monthly sales volume as of the end of January 2020 of $50,000.
Once QGLOBAL SMS, LLC reaches monthly sales of $50,000 for three consecutive months, provided the percentage of gross monthly margin is maintained above 12%, we are committed to invest $50,000 to prepay SMS providers, and an additional $200,000 to be used to pay SMS providers based on the amount of sales reached. We have also agreed to transfer the interconnection agreements for SMS signed by our subsidiary, Etelix.com USA, LLC, within 30 days of execution of the joint venture.
Mr. Iglesias has agreed to transfer to us his 50% interest in the already formed QGLOBAL SMS, LLC. Mr. Vega will transfer 1% of his interest for a total of 51% to us and 49% to Mr. Vega. QGLOBAL SMS, LLC will have 4 board members, which will include Mr. Iglesias, Italo Segnini, Mr. Vega and our CFO, Alvaro Quintana.
Mr. Vega will be entitled to a salary of $3,500 per month and bonuses as set forth in the agreement to be paid in shares of our common stock at a value of $1.30 per share.
We have been granted an option to purchase Mr. Vega’s interest in the joint venture after 18 months.
The foregoing description of the agreement is not complete and is qualified in its entirety by reference to the text of such document, which is filed as Exhibit 2.1 hereto and which is incorporated herein by reference.