8-K
QS Energy, Inc. (QSEP)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event
reported): June 19, 2025
QS Energy, Inc.
(Exact Name of Registrant as Specified in Charter)
| Nevada | 0-29185 | 52-2088326 |
|---|---|---|
| (State or other jurisdiction<br><br> <br>of incorporation) | (Commission File <br><br>Number) | (IRS Employer <br><br>Identification No.) |
| 23902<br> FM 2978 | ||
| --- | --- | |
| Tomball, Texas | 77375 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (775) 300-7647
____________________________________________________________
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d- 2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e- 4(c)) |
Securities registered pursuant to Section 12(b) of the Exchange Act: None.
| Title of each Class | Trading Symbol | Name of each exchange on which registered |
|---|---|---|
| N/A | N/A | N/A |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240. 12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry
into a Material Definitive Agreement.
On June 19, 2025 (“Effective Date”), QS Energy, Inc. (the “Company”) entered into a distributor agreement (“Distribution Agreement”) with VIPS Petroleum (“Distributor”), a corporation organized under the laws of England and Wales.
The Distribution Agreement provides for the appointment of Distributor to serve as the Company’s exclusive distributor to promote, sell, and lease the Company’s Applied Oil Technology units (“AOT”) in the territories (“Territories”) of India, Indonesia, Liberia, Ghana, Nigeria, Malaysia, Singapore, Vietnam, Laos, Philippines, Australia, Bahrain, and Thailand for a period of twelve (12) months from the Effective Date.
The term (“Term”) of the Distribution Agreement is ten (10) years from the Effective Date, subject to earlier termination for cause, as follows: (i) either the Company or Distributor may terminate the Distribution Agreement upon 30 days’ written notice to the other of a material breach not cured within the notice period; and, (ii) the Company may terminate the Distribution Agreement without notice for Distributor’s non-payment, fraud, misrepresentation, or non-compliance with U.S. SEC [Securities and Exchange Commission] and FCPA [Foreign Corrupt Practices Act] regulations. The Term shall automatically renew for ten (10) years unless either party provides notice to the other of termination one (1) year prior to the initial Term’s expiration date.
The Distribution Agreement provides that Distributor may elect to purchase AOT units from the Company. For each AOT unit purchased by Distributor, Distributor shall pay the Company a purchase price of five million dollars ($5,000,000) (“Purchase Price”). Fifteen percent (15%) of the Purchase Price ($750,000) for each AOT unit shall be subject to a post-purchase rebate, payable by the Company to Distributor within one (1) business day following the Company’s confirmation of cleared Purchase Price funds. Alternatively, Distributor may elect a commission model whereby Distributor will receive a ten percent (10%) commission on gross revenue generated by sales of the AOT units to end users in the Territories.
Upon Company’s receipt of Distributor’s order for the purchase of AOT units, the Company will generate and send an invoice to Distributor in an amount equal to the Purchase Price multiplied by the number of AOT units ordered. The Company’s payment terms are due on receipt, except Distributor may request payment terms of net 30 days subject to Company’s approval and Distributor providing Company with proof of funds documentation.
In addition to the above compensation arrangement, subject to negotiation and the execution of an “Additional Revenue” addendum to the Distribution Agreement, the Company and Distributor will share additional revenue, if any, generated from sales and use of AOT units in the Territories.
The Distribution Agreement also provides that upon the Company’s receipt of payment of twenty-five million dollars ($25,000,000), representing Distributor’s payment for an initial order of five (5) AOT units, the Company will issue 25,000,000 shares of its common stock to Distributor subject to additional agreements between Company and Distributor setting forth the form and terms and conditions of such issuance.
The Distribution Agreement also contains terms and conditions, regarding, among others, Company product warranties, Company obligations, and Distributor obligations.
The above description of material terms and conditions of the Distribution Agreement is qualified in its entirety by reference to the Distribution Agreement, a copy of which is attached hereto as Exhibit 10.1, and incorporated herein by this reference.
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Forward-Looking Statements
The Company cautions you that statements included in this Current Report on Form 8-K (including the exhibit hereto) that are not a description of historical facts are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negatives of these terms or other similar expressions. These statements are based on current expectations, estimates and projections about our business based in part on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may, and are likely to, differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including those set forth our periodic reports filed with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and the Registrant undertakes no obligation to revise or update this report to reflect events or circumstances after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit<br><br> <br>Number | Description |
|---|---|
| 10.1 | Distributor Agreement |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: June 25, 2025 | QS ENERGY, INC. |
|---|---|
| By: /s/ Cecil Bond Kyte | |
| Name: Cecil Bond Kyte | |
| Title: CEO and CFO |
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Exhibit 10.1
DISTRIBUTORAGREEMENT
This Distributor Agreement (the “Agreement”) is made and entered into as of this 19 day of June, 2025 (the “Effective Date”), by and between:
| 1. | QS Energy, Inc. (“Manufacturer”), a corporation organized under the laws of the State<br>of Nevada, listed on the OTC Markets under ticker symbol [QSEP], with its principal executive offices located at 23902 FM 2978, Tomball,TX 77375. |
|---|---|
| 2. | VIPS Petroleum (“Distributor”), a corporation organized under the laws of England and<br>Wales, with principal offices located at Ofsec, Salt Lane, Salisbury, Wiltshire, England, SP1 1DU. For each country that is onboarded,<br>VIPS Petroleum will be setting up a separate distribution company for each order. |
The parties agree as follows:
| 1. | APPOINTMENT AND SCOPE |
|---|---|
| 1.1 | Exclusive Distributor: Manufacturer hereby appoints Distributor as its exclusive distributor for the promotion, sale,<br>and lease of QS Energy’s Applied Oil Technology (AOT) Units within its assigned territories, subject to the terms and conditions<br>herein. |
| --- | --- |
| 1.2 | Products Covered: This Agreement applies to all AOT Units and related services, including but not limited to installation,<br>maintenance, and performance testing services. |
| --- | --- |
| 1.3 | Territorial Exclusivity: VIPS shall have exclusive distribution rights for AOT units in India, Indonesia, Liberia, Ghana, Nigeria, Malaysia, Singapore, Vietnam, Laos, Philippines, Australia, Bahrain, and Thailand for a period of twelve (12) months from the Effective Date, in alignment with the Collaboration Agreement. |
| --- | --- |
| 1.4 | No Right to Modify: Distributor shall not modify, alter, or reverse engineer the AOT Units without prior written consent of<br>the Manufacturer. Improvements will be memorialized via an engineering services agreement between QS Energy and VIPS. |
| --- | --- |
| 1.5 | Improvements: Distributor will work closely with the manufacturer to improve AOT units and these improvements will be co-credited<br>to both the manufacturer and distributor via a separate new or continuation in part patent. These improvements will be memorialized via<br>an engineering services agreement between QS Energy and VIPS. |
| --- | --- |
| 1.6 | Supply Chain: Distributor will work closely with the manufacturer to improve, expand, and enhance all aspects of the AOT supply<br>chain, including but not limited to AOT components. Improvements will be memorialized via an engineering services agreement between QS<br>Energy and VIPS. |
| --- | --- |
| 1.7 | Systems & Technology: Distributor will co-develop all aspects of the AOT technology stack, system, communications, data<br>and all other various IT requirements. Improvements will be memorialized via an engineering services agreement between QS Energy and VIPS. |
| --- | --- |
| 2. | TERM AND TERMINATION |
| --- | --- |
| 2.1 | Term: This Agreement shall commence on the Effective Date and remain in effect for ten (10) years, unless terminated<br>earlier under Section 2.2. |
| --- | --- |
| 2.2 | Termination for Cause: |
| --- | --- |
| ● | Either party may terminate this Agreement upon thirty (30) days’ written notice if the<br>other party materially breaches any provision and fails to cure within the notice period. |
| --- | --- |
| ● | Manufacturer may terminate immediately if Distributor engages in non-payment, fraud, misrepresentation,or non-compliance with U.S. SEC and FCPA regulations. |
| --- | --- |
| 2.3 | Effect of Termination: Upon termination, Distributor shall cease marketing and sales activities and return all confidential<br>information, marketing materials, and unused inventory to the Manufacturer. |
| --- | --- |
| 2.4 | Additional Revenue: The ten (10) year term on this agreement has no impact on any and all incremental revenue which is governed<br>by the details of the “additional revenue agreement/addendum” |
| --- | --- |
| 2.5 | Auto Renewal: The ten (10) year term on this agreement auto renews for ten (10) years unless either party provides notice of<br>contract termination one (1) year prior to the initial ten (10) contract end date. |
| --- | --- |
| 3. | REVENUE SHARING & PAYMENT TERMS & OTHER CONSIDERATIONS |
| --- | --- |
| 3.1 | Revenue Model Options: |
| --- | --- |
Distributor may choose between the following revenue models on a per-contract basis:
Commission Model
| ● | 10% Commission Model: Distributor may opt to receive a 10% commission on gross revenue from specific<br>contracts in alignment with the Collaboration Agreement. |
|---|
OR
MSRP + Rebate Model:
| ● | Manufacturer shall invoice the Distributor at the full Manufacturer Suggested Retail Price (MSRP) of<br>$5,000,000 USD per unit. Distributor shall remit full payment of $5,000,000 per unit. Upon confirmation of cleared funds, QS Energy will<br>process a post-sale rebate 15% of the MSRP ($750,000 per unit) to Distributor within one (1) business day. The rebate shall be treated<br>as a marketing rebate or contra-revenue transaction for financial reporting purposes, in compliance with GAAP. The gross revenue recognized<br>per unit will remain $5,000,000. |
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| --- | | 3.2 | Additional Revenue: | | --- | --- | | | The parties shall share additional<br>revenue generated from sales above and beyond unit sales, i.e., incremental barrels, etc. Each agreement and order with each region will<br>have a custom arrangement between the Distributor and the Manufacturer for additional revenue. These terms will be negotiated and memorialized<br>by executing an “Additional Revenue” addendum to this agreement. | | 3.3 | Order Process & Payment Terms: | | --- | --- | | ● | Orders (Exhibit B) | | --- | --- | | ○ | Order placed via phone or electronic message or a PO between VIPS and QS Energy. | | --- | --- | | ○ | QS Energy will issue an Invoice to VIPS via email for review, approval and payment. | | ○ | Order processing<br>starts after payment is received and cleared. | | ● | Payments (Exhibit A) | | --- | --- | | ○ | Standard payment terms are net zero. Orders will expire in 24 hours after the order is placed if the<br>order is paid for. | | --- | --- | | ○ | The distributor can request a change in payment terms (ie, net 30) on a per order basis subject to approval<br>by the manufacturer which will be based on the distributor providing proof of funds documentation. | | 3.4 | Currency & Exchange Rates: | | --- | --- | | ● | All transactions shall be conducted in U.S. Dollars (USD). | | --- | --- | | ● | The distributor assumes all currency exchange risks related to foreign transactions. | | --- | --- | | 3.5 | Additional Consideration (Equity) | | --- | --- | | ● | VIPS will be issued 25 Million shares of QSEP after QSEP receives a payment for an order of (5) units<br>at $5 Million USD per unit. | | --- | --- | | ● | VIPS will provide the proper information to QSEP to receive the shares. | | --- | --- | | ● | Details require additional agreements as outlined in the collaboration agreement below via section 4.<br>“Consideration & Rights”. | | --- | --- |
| 4. | COMPLIANCE & REGULATORY REQUIREMENTS |
|---|---|
| 4.1 | SEC Compliance: Manufacturer, as a publicly traded entity, shall ensure compliance with: |
| --- | --- |
| ● | Securities Act of 1933 and Securities Exchange Act of 1934. |
| --- | --- |
| ● | GAAP/IFRS financial reporting. |
| --- | --- |
| ● | Full and fair disclosure of material business terms. |
| --- | --- |
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| --- | | 4.2 | FCPA & Anti-Corruption: | | --- | --- | | ● | Distributors shall not offer or accept bribes or unlawful incentives. | | --- | --- | | ● | The distributor shall maintain accurate records of all transactions related to this Agreement. | | --- | --- | | 4.3 | Export Control: Manufacturer and Distributor shall comply with U.S. Export Administration Regulations (EAR) and Office ofForeign Assets Control (OFAC) sanctions. | | --- | --- | | 5. | PERFORMANCE & SUPPORT | | --- | --- | | 5.1 | Manufacturer’s Obligations: | | --- | --- | | ● | Provide Distributor with marketing materials, technical training, and installation support. | | --- | --- | | ● | Confirm AOT Units meet minimum performance standards. | | --- | --- | | ● | Travel to distributor and end<br>user as needed. | | 5.2 | Distributor’s Obligations: | | --- | --- | | ● | Actively market, sell, and lease AOT Units. | | --- | --- | | ● | Provide post-sale customer and installation support and performance monitoring (wholesale model<br>only) | | --- | --- | | ● | Maintain proper sales documentation and reporting to the Manufacturer. | | --- | --- | | ● | Travel to<br>customers as needed. | | 6. | WARRANTIES & LIABILITY | | --- | --- | | 6.1 | Manufacturer Warranty: | | --- | --- | | ● | Manufacturer warrants that the AOT Units are free from material and workmanship defects for twelve(12) months from installation or (18) months from shipment whichever is shorter. | | --- | --- | | ● | Warranty claims must be reported within 30 days of defective discovery and submitted via email<br>to QS Energy. | | --- | --- | | ● | To process warranty claims equipment must be sent to a QS Energy approved site for evaluation. | | --- | --- | | ● | QS Energy has (10) days to approve or deny the warranty claim. | | --- | --- | | ● | If equipment qualifies for a warranty, the manufacturer will elect to repair or replace the equipment<br>at their sole option. | | --- | --- | | 6.2 | Limitation of Liability: | | --- | --- | | ● | Manufacturer’s liability is limited to direct damages, not exceeding total paymentsreceived under this Agreement. | | --- | --- | | ● | Neither party shall be liable for consequential, incidental, special, or punitive damages. | | --- | --- |
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| 7.1 | Arbitration: |
| --- | --- |
| ● | Any disputes shall be resolved through binding arbitration under the United States of America’s<br>rules. |
| --- | --- |
The arbitration shall take place in Tomball, TX, and be conducted in English.
| 7.2 | Governing Law: |
|---|---|
| ● | This Agreement shall be governed by the laws of the State of TX, USA, in alignment with the Collaboration<br>Agreement. |
| --- | --- |
| 8. | MISCELLANEOUS |
| --- | --- |
| 8.1 | Confidentiality: Both parties shall maintain strict confidentiality of all proprietary business information. |
| --- | --- |
| 8.2 | Non-Assignment: Neither party may assign this Agreement without prior written consent. |
| --- | --- |
| 8.3 | Entire Agreement: This Agreement supersedes all prior agreements and constitutes the entire understanding between the<br>parties. |
| --- | --- |
Company Primary Contact Information
| Entity | Name | Address | Email/Phone |
|---|---|---|---|
| VIPS Petroleum | John McCleod Jr.<br><br> <br><br><br> <br>CEO | 6919 West Broward<br><br> <br><br><br> <br>Blvd #261 Plantation FL 33317 | jmccleod@vipspetroleum.com<br><br> <br>571-575-6050 |
| QS Energy Inc | Todd Dunphy<br><br> <br><br><br> <br>Head of Biz Dev | 23902 FM 2978<br><br> <br><br><br> <br>Tomball, TX 77375 | todd.dunphy@qsenergy.com<br><br> <br>281-627-4886 |
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.
QS Energy, Inc.
| By: | /s/ Cecil Bond Kyte |
|---|---|
| Name: | Cecil Bond Kyte |
| Date: | 6/19/2025 |
| Title: | Chief Executive Officer |
VIPS Petroleum
| By: | /s/ John A McCleod Jr |
|---|---|
| Name: | John A McCleod Jr |
| Date: | 6/19/2025 |
| Title: | Chief Executive Officer |
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Exhibit A
| A-1 |
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Exhibit B
SampleOrder Form/Letter
June 29, 2025
From:
VIPS Petroleum
Ofsec, Salt Lane
Salisbury, Wiltshire England, SP1 1DU
To:
QS Energy, Inc.
Attn: Todd Dunphy
23902 FM 2978
Tomball, TX 77375
Official Orderfor (5) AOT Units – Net Zero Payment Terms
Dear Mr. Dunphy,
Pursuant to the Distributor Agreement entered into between VIPS Petroleum and QS Energy, dated June 20, 2025, this letter shall serve as our official order for five (5) AppliedOil Technology (AOT) units.
Please find below the details of the order:
Order Details
| ● | Product: | Applied Oil Technology (AOT) Unit |
|---|---|---|
| ● | Sale Type: | Wholesale |
| ● | Quantity: | 5 Units |
| ● | Unit Price (MSRP): | $5,000,000 USD |
| ● | Total Order Value: | $25,000,000 USD |
| ● | Payment Terms: | Net Zero – full payment to be made net<br>zero |
| ● | Revenue Model Selected: | MSRP + Rebate Model |
○ 15% post-sale rebate per unit ($750,000), totaling $3,750,000
○ Rebate to be processed by QS Energy within one (1) business day after receipt of cleared funds
| B-1 |
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We request that QS Energy issue a formal invoice for the above order. Upon receipt of the invoice and confirmation of wire instructions, VIPS Petroleum will remit payment in full in accordance with the agreement.
We appreciate your partnership and look forward to initiating the manufacturing and delivery process.
Included in this order will be one (1) unitof the AOT v 2.99 that will be assembled and shipped to VIPS for zero cost. This unit is expected to be shipped within 45 days of thisorder,
Sincerely,
John McCleod Jr.
Chief Executive Officer
VIPS Petroleum
jmccleod@vipspetroleum.com
+1 (571) 575-6050
https://vipspetroleum.com/
| B-2 |
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