Summary

  • iQSTEL says it closed the first financing tranche for its planned 51% purchase of Ultranet. The package includes up to $3 million of two-year secured notes at 18% annual interest and warrants for up to 420,000 common shares.
  • The notes pay interest monthly and repay 25% of principal every six months. The acquisition is still targeted for mid-Q1 2027; the amount actually funded in the first tranche is not disclosed.

“Non-convertible” sounds tidy. Then the footnote walks in carrying warrants. iQSTEL’s 26 October release says the notes used for its planned Ultranet acquisition cannot convert into shares. The same financing package includes pre-funded warrants to buy as many as 420,000 shares. One instrument avoids a conversion feature; another can still create shares through exercise. The distinction is right there in the capital structure, not in a public-relations adjective.

The financing also has a calendar. The two-year senior secured notes carry 18% annual interest, paid monthly. Principal is due in four equal semiannual instalments, each equal to 25% of the original principal. iQSTEL has closed the first tranche, but the release does not say how much was drawn. It gives a ceiling of up to $3 million, not a confirmed $3 million balance.

That repayment clock starts alongside an acquisition timetable that is not finished. iQSTEL expects to sign the share purchase agreement in November and targets closing in the middle of Q1 2027, subject to customary conditions. The June binding MOU set $17.6 million as consideration for 51% of Ultranet, with $3 million of initial cash due when the definitive purchase agreement is executed and the remainder split between later cash and earnings-linked payments. The new note ceiling matches the scale of that first scheduled payment. The public documents do not establish that the entire payment has already been funded.

The financing carries two separate obligations. A fixed interest bill and scheduled principal repayments put cash demands on the buyer; warrants provide a separate route to issue shares. The announced plan therefore has two financing surfaces: monthly cash costs and a possible increase in common shares. The release gives the warrant ceiling; the actual first-tranche amount, accrual start date and complete warrant exercise terms remain undisclosed.

The business expected to carry the debt service has not yet joined the group. iQSTEL says Ultranet produced $5.5 million of operating cash flow in 2025 and that its expected post-acquisition cash flow will fund principal payments. The same release says Ultranet’s reported operating cash flow excludes owner drawings that the company expects to stop after acquisition. Those are management’s forward-looking assumptions; the release gives no post-close cash-flow schedule showing what remains after the 18% interest, semiannual principal, working capital and integration needs.

The release reports Ultranet’s 2025 figures on a 100% basis: $130.9 million revenue, $5.0 million EBITDA and $4.6 million net income. iQSTEL intends to acquire 51%. Those figures describe the target’s past year; they do not show the cash that will be available to service this particular note. The company’s reported $9 million annualised adjusted EBITDA expectation is a forecast rather than a current consolidated result.

That is the useful test for the next filing. It should identify the first tranche’s actual principal, show when interest begins, set out the warrants’ exercise price and share terms, and connect the six-month repayment dates to the acquisition’s closing conditions. Until then, the headline has an unusually clear price—18%—and a less visible funding amount. The loan’s calendar is legible; the cash available to meet it is still a projection.

Sources: iQSTEL’s 26 October financing release; iQSTEL’s 3 June Form 8-K on the Ultranet MOU.

Reference checked: iQSTEL 2026 SEC filings.