Quarterly report pursuant to Section 13 or 15(d)

Transactions with Related Parties

v3.20.2
Transactions with Related Parties
9 Months Ended
Sep. 30, 2020
Related Party Transactions [Abstract]  
Transactions with Related Parties

17. TRANSACTIONS WITH RELATED PARTIES

During the three and nine months ended September 30, 2020 and 2019, related party transactions, other than compensation and similar arrangements in the ordinary course of business, were as follows:

 

i.

Unsecured convertible promissory notes, received by Esse Effe and Maya at the closing of the Business Combination, pursuant to the terms of the Stock Purchase Agreement. Maya is affiliated with Dario Calogero, who is the Chief Executive Officer and a director of Kaleyra. Esse Effe is affiliated with Dr. Emilio Hirsch, a director of the Company. The outstanding amount due by the Company was $7.5 million plus $186,000 of accrued interest as of September 30, 2020 ($7.5 million plus $22,000 of accrued interest as of December 31, 2019). In addition, an unsecured non-convertible promissory note in the principal amount of $6 million plus $105,000 in accrued interest held by Esse Effe was repaid in full on July 2, 2020. See Note 9 – Notes Payable – for additional information;

 

ii.

Legal services rendered by a partner of Studio Legale Chiomenti, that is a family member of a key manager of the Company. Costs incurred by the Company for the above services were $107,000 and $249,000 in the three and nine months ended September 30, 2020 (zero in the three and nine months ended September 30, 2019); and

 

iii.

As of September 30, 2020 and December 31, 2019, the outstanding obligation for preference shares due to executive managers was zero and $1.8 million, respectively. As mentioned above, in the three months ended March 31, 2020, as a result of a modification of the 2018 Solutions Infini Purchase Agreement, a significant portion of the liability for preference shares was reversed to the statement of operations. See Note 10 – Preference Shares Liabilities – for further details.

The following table presents the expenses for transactions with related parties reported in the condensed consolidated statements of operations (in thousands):

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Research and development

 

$

 

 

$

19

 

 

$

 

 

$

163

 

General and administrative

 

 

107

 

 

 

19

 

 

 

249

 

 

 

163

 

Financial expense, net

 

 

55

 

 

 

 

 

 

299