| Transactions with Related Parties |
17. TRANSACTIONS WITH RELATED PARTIES
During the three months ended March 31, 2020 and 2019, related party transactions, other than compensation and similar arrangements in the ordinary course of business, were as follows:
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i.
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Unsecured convertible promissory notes and unsecured non-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 and the shares are beneficially owned by Mr. Calogero who is the Chief Executive Officer and a director of Kaleyra. Esse Effe is affiliated with a former director of the Company and which holds an interest in the Company. The outstanding amount due by the Company was $15.0 million plus $152,000 of accrued interest as of March 31, 2020 ($15.0 million plus $43,000 of accrued interest as of December 31, 2019). See Note 9 – Notes Payable – for additional information;
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ii.
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Unsecured promissory notes issued by the Company to the Sponsor and GigFounders, LLC. The outstanding amount due by the Company was $1.9 million. Accrued interest on these promissory notes amounted to $19,000 as of March 31, 2020 ($1.9 million and $5,000 of accrued interest as of December 31, 2019). See Note 9 – Notes Payable – for additional information;
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iii.
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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 $56,000 and zero in the three months ended March 31, 2020 and 2019;
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iv.
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Loans granted to Company’s directors and executive managers (at the reporting date, also Company’s stockholders) whose outstanding amount was $21,000 and $22,000 as of March 31, 2020 and December 31, 2019, respectively; and
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v.
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As of March 31, 2020 and December 31, 2019, the outstanding obligation for preference shares due to executive managers was $1,000 and $1.8 million, respectively. As mentioned above, in the three months ended March 31, 2020, as a result of a modification of the 2018 Solutions Infini Purchase Agreement, a significant portion of the liability for preference shares was reversed to the statement of operations. See Note 10 – Preference Shares Liabilities – for further details.
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The following table presents the expenses for transactions with related parties reported in the condensed consolidated statements of operations (in thousands):
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Three Months Ended March 31,
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2020
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2019
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Research and development
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$
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—
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$
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94
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General and administrative
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56
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94
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Financial income (expense), net
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122
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—
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