UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 10-K/A

Amendment No. 2

 

(Mark One)

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended July 31, 2019

 

OR

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______ to ______

 

Commission file number 001-39052

 

TOGA LIMITED

(Exact name of registrant as specified in its charter)

 

NEVADA

 

98-0568153

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No)

 

515 S. Flower Street

18th Floor

Los Angeles, CA 90071

 

(949) 333-1603

(Address of principal executive offices, including zip code)

 

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

N/A

N/A

N/A

 

Securities registered pursuant to Section 12(g) of the Act:

 

Class A Voting Common Stock, par value $0.0001 per share

(Title of Class)

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES ☐ NO ☒

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. YES ☐ NO ☒

 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ☐ NO ☒

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YES ☐ NO ☒

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “non-accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

 

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

 

 

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.

 

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

 

Indicate by check mark whether the registrant is a shell company, (as defined in Rule 12b-2 in the Exchange Act). YES ☐ NO ☒

 

The aggregate market value of the registrant’s voting stock held by non-affiliates (based on the closing sale price of the registrant’s Class A Voting Common Stock, par value $0.0001 per share, as reported by the OTC Markets Group Inc.) was approximately $282,746,703 as of January 31, 2019.

 

As of January 28, 2021, the number of shares of the registrant’s Class A Voting Common Stock outstanding was 91,013,640, par value $0.0001 per share.

 

 

 

EXPLANATORY NOTE

   

This Amendment No. 2 to the Annual Report on Form 10-K (this “Amended Annual Report”) amends the Annual Report on Form 10-K of Toga Limited (the “Company”) for the year ended July 31, 2019 (the “Original Form 10-K”), filed on November 14, 2019 with the Securities and Exchange Commission (the “SEC”), and that first amendment to the Company’s Annual Report on Form 10-K for the year ended July 31, 2019, filed on June 12, 2020 with the SEC (“Amendment No. 1”, and collectively with the Original Form 10-K, the “Form 10-K”). This Amended Annual Report restates the Company’s financial statements in order to correct errors resulting from the improper timing of revenue recognition from PT. Toga International Indonesia (“PT Toga”), the Company’s wholly owned Indonesian subsidiary. In the course of preparing the Annual Report on Form 10-K for the annual period ended July 30, 2020, the Company’s management discovered that revenue recognition was occurring on the collection of proceeds rather than on the shipment of product. In addition, the related commissions expense is being restated to properly reflect these costs against the restated revenues, resulting in a prepaid commission asset balance for the portion of the commission expenses for which revenue recognition was deferred. A summary of the accounting impact of these adjustments to the Company’s consolidated financial statements as of and for the year ended July 31, 2019 is provided at “Note 10 Restatement of Financial Statements.”

  

This Amended Annual Report also amends and includes a summary of updates to the business description of the Company to include descriptions of the Company’s direct marketing line of business and the Company’s general services agreement with a related party, both of which comprise the majority of the Company’s revenue during the year ended July 31, 2019.

  

In order to provide the Company’s stockholders with a better understanding of the Company’s business, this Amended Annual Report also includes modifications and updates to Management’s Discussion and Analysis of Financial Condition and Results of Operations and other disclosures made in the Original Form 10-K to be accurate as of the date of filing this Amended Annual Report.

  

Finally, in accordance with Rule 12b-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company is also including with this Amendment No. 2 currently dated certifications of the Company’s Chief Executive Officer and Principal Financial Officer (attached as Exhibits 31.1, 31.2, 32.1, and 32.2).

  

 
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Toga Limited

Form 10-K

 

Table of Contents

 

PART I

 

4

 

Item 1.

Business

 

4

 

Item 1A.

Risk Factors

 

20

 

Item 2.

Properties

 

37

 

Item 3.

Legal Proceedings

 

39

 

Item 4.

Mine Safety Disclosures

 

39

 

 

 

 

 

 

PART II

 

40

 

Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 

40

 

Item 6.

Selected Financial Data

 

44

 

Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

44

 

Item 8.

Financial Statements and Supplementary Data

 

51

 

Item 9.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 

51

 

Item 9A.

Controls and Procedures

 

52

 

Item 9B.

Other Information

 

54

 

 

 

 

 

PART III

 

55

 

Item 10.

Directors, Executive Officers and Corporate Governance

 

55

 

Item 11.

Executive Compensation

 

62

 

Item 12.

Security Ownership of Certain Beneficial Owners and Management

 

67

 

Item 13.

Certain Relationships and Related Transactions, and Director Independence

 

69

 

Item 14.

Principal Accountant Fees and Services

 

73

 

 

 

 

 

PART IV

 

74

 

Item 15.

Exhibits, Financial Statement Schedules

 

74

 

Item 16.

Form 10-K Summary

 

78

 

 

 

 

 

 

Index to Consolidated Financial Statements

 

F-1

 

 

 

 

 

 

Signatures

 

S-1

 

 

 

 

 

 

Certifications

 

See Exhibits

 

 

 
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Table of Contents

 

CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS

 

Certain statements and information in this Amended Annual Report may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements concerning plans, objectives, goals, projections, strategies, future events, or performance, and underlying assumptions and other statements, which are not statements of historical facts. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” or other comparable terminology. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. Forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Forward-looking statements represent management’s beliefs and assumptions only as of the date of this Amended Annual Report. You should read this Amended Annual Report completely and with the understanding that our actual future results may be materially different from what we expect. Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

 

PART I

 

Item 1. Business.

 

General

 

Our Company

 

Toga Limited (“Toga,” the “Company,” “we,” “our,” or “us”) is a Nevada holding company with its corporate headquarters in Los Angeles, California that conducts its business through its subsidiaries, all of which operate exclusively in Asia. We have two lines of business. The first is our technology business, in which we are developing a social media app called “Yippi” or the “Yippi App.” The Yippi App is a mobile application with a focus on enabling people to connect and share with friends and family on the app. Our second business consists of products based on traditional, eastern wellness principles that we market and sell under our “Eostre” brand through a direct marketing network.

 

Corporate History

 

We were incorporated on October 23, 2003 pursuant to the laws of the State of Delaware under the name Fashionfreakz International Inc., which we later changed to Blink Couture, Inc. From 2003 until 2008, our principal business was the online retail marketing of trendy clothing and accessories produced by independent designers, with headquarters based in Canada. From 2008 until 2017, the Company’s business plan consisted of exploring potential targets for a business combination. On July 22, 2016, we changed our name to “Toga Limited.” In July 2018, we changed our state of incorporation to the State of Nevada.

 

 
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We have had two stock splits. On September 11, 2017, we effected a forward-split of all of the outstanding shares of our common stock, par value $0.0001 per share, at the rate of fifty shares for every one share (1:50). On June 5, 2019, we effected a reverse-split of all of the outstanding shares of the common stock at the rate of one share for every ten shares (10:1). For ease of reference, all share amounts and prices contained herein reflect the effect of the reverse stock split. On September 11, 2020, we filed Amended and Restated Articles of Incorporation (the “A&R Articles of Incorporation”) with the Secretary of State of the State of Nevada for the purpose of dividing and designating the 1,000,000,000 shares of the common stock into two classes, consisting of 500,000,000 shares of Class A voting common stock, par value $0.0001 per share (referred to herein as our “Common Stock”), and 500,000,000 shares of Class B non-voting common stock, par value $0.0001 per share (our “Class B Common Stock”), none of which are currently issued and outstanding.

 

Our principal executive offices are located at 515 South Flower Street, 18th Floor, Los Angeles, California 90071. Our telephone number is (949) 333-1603. Our internet address is https://togalimited.com/. Through a link on the “Investor Relations” section of our website, we make available the following filings as soon as reasonable practicable after they are electronically filed with or furnished to the SEC: (i) our Annual Reports on Form 10-K, (ii) our Quarterly Reports on Form 10-Q, (iii) our Current Reports on Form 8-K, and (iv) any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act. All such filings are available free of charge. Information contained on our website or that is accessible through our website should not be considered to be part of this Amended Annual Report.

 

Subsidiaries

 

In September 2017, we formed TOGL Technology Sdn. Bhd. (“TOGL Technology”), a wholly-owned subsidiary located in Malaysia. In May 2018, TOGL Technology opened a branch office in Taiwan. The Company suspended operations of its Taiwan branch in July 2020 due to the novel coronavirus (“COVID-19”). TOGL Technology offers technology and professional services to facilitate the use of technology by enterprises and end users. These services include software development, integration, maintenance, mobile services, and web applications. TOGL Technology also provides development of, and upgrades to, our mobile application, the Yippi App.

 

In November 2017, we formed PT Toga International Indonesia (“PT Toga Indonesia”), a majority-owned subsidiary located in Indonesia. We own a 95% interest in PT Toga Indonesia. The remaining portion is owned by three individuals who are employed by our subsidiaries. PT Toga Indonesia mainly sells health-related and facial products via retail stores or through direct selling independent sales agents that sell our “Eostre” branded products at exhibitions and healthy introduction seminars.

 

In January 2019, TOGL Technology, formed a wholly-owned subsidiary, Toga Vietnam Company Limited (“Toga Vietnam”), located in Vietnam. Toga Vietnam provides customer services support for Yippi users located in Vietnam.

 

In May 2019, TOGL Technology, formed a majority-owned subsidiary, PT TOGL Technology Indonesia (“PT TOGL Indonesia”), located in Indonesia. TOGL Technology owns a 67% interest in PT TOGL Indonesia. PT TOGL Indonesia provides technology and professional services to facilitate the use of technology by enterprises and end users. These services include software development, integration, maintenance, mobile services, and web applications.

 

In June 2019, TOGL Technology acquired 100% of the issued and outstanding shares of WGS Discovery Tours and Travel (M) Sdn. Bhd., a Malaysian based company (“WGS”). WGS manages our travel, hotel, and flight feature (“TogaGo”) offered through the Yippi App.

 

 
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Subsidiaries formed after July 31, 2019

 

In June 2020, Michael Toh Kok Soon (“Mr. Toh”), our Chief Executive Officer and Chairman, Roy Lim Jun Hao (“Mr. Lim”), TOGL Technology’s Deputy Executive Officer, and we collectively acquired 65% of the issued and outstanding shares of Eostre Bhd., a Malaysia corporation (“Eostre Bhd.”). We intend to acquire the remaining 35% of the issued and outstanding shares of Eostre Bhd. as described in more detail below under the section entitled “Eostre – Recent Changes to the Eostre Business.” Further, Eostre Bhd.’s business is discussed in detail below under the section entitled “Eostre.”

 

Yippi

 

Industry Overview

 

An “app” is a type of application software designed to run on a mobile device, such as a smartphone or tablet device. Over the last several years, mobile devices, including smartphones and tablets, have proliferated extensively around the world across a wide range of demographic groups.

 

As mobile devices have become more prevalent, the mobile apps industry has experienced corresponding growth in the number of apps published and the niches they serve, as well as the revenues they generate. We believe that there will continue to be an increase in the number of smartphones and tablets sold. In addition, Apple, Inc. (“Apple”), Samsung Group (“Samsung”), and other mobile device manufacturers have introduced new, larger, and more powerful smartphones and tablets that enable more complex apps and that allow app developers to create apps that are optimized for larger screen sizes and designed to take advantage of these devices’ advanced capabilities and functionality. We believe that the proliferation of, and technological developments, to, mobile devices will continue to drive growth in our industry for the foreseeable future.

 

Product and Market

 

The Yippi App is a mobile application with a social media messaging focus that enables users to discover new friends as well as connect with friends and family. The Yippi App also focuses on entertainment and security. Users download the Yippi App through the Apple App Store, Google Play, or the Amazon App Store. Similar to other social media mobile apps, the Yippi App allows users to post photos and videos, watch, like, and share live events, use a beauty camera to enhance photos, and generally connect with others through chat messaging and video calls. Our chat feature allows users to use a “secret chat” function that automatically deletes text messages, voice messages, or photos sent through chat messages. We also have other features to allow chat messages to be more interactive between users, such as our “whiteboard presentation” feature that allows up to 5 users to draw on a whiteboard within the chat message.

 

Finally, through Yippi, we also offer an in-app feature called TogaGo, which enables users to search for the best price for their travel needs on an array of hotel, cruise, and flights and book and purchase these accommodations. Currently, prices are comparable to major travel applications in the market, and with this feature we have bridged these two different applications into one comprehensive application. These extensions are essentially bridged within Yippi with a link to the target platform while the user is still logged into his or her Yippi account. We also maintain a website that allows users to access TogaGo.

 

 
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In addition to TogaGo, we also generate revenue from selling advertising, emoji stickers, and Yipps through our tipping feature called Yippi Star. As of December 1, 2020, we had 214,442 monthly active users and 120,412 daily active users on Yippi. We define a “monthly active user” as a registered user of the Yippi App who opens the Yippi App at least once during a 30-day period. We define a “daily active user” as a registered user of the Yippi App who opens the Yippi App at least once during a 24-hour period for a consecutive 30-day period.

 

The market for our Yippi App is characterized by rapid technological change, particularly in the technical capabilities of smartphones and tablets, and changing end-user preferences. Therefore, we will be required to continuously invest capital to innovate and modify our Yippi App and publish new applications. We cannot provide assurances that we will have adequate capital to modify our Yippi App or develop new applications.

 

Marketing Strategy

 

In an effort to increase our daily active users and monthly active users, our marketing strategy focuses on three areas: (i) Market Penetration; (ii) Yippi Publicity; and (iii) Market Development.

 

Market Penetration. Market Penetration focuses on engaging key opinion leaders and agencies to help increase our publicity and contests within Yippi. We also intend to engage in corporate branding on social media and increase our internet presence.

 

Yippi Publicity. Yippi Publicity focuses on corporate social responsibility (such as raising money for charitable causes), awareness campaigns (to increase daily active users or to increase users’ daily activity), and live concerts and music sharing (such as engaging Malaysian singers and exclusive content for the Yippi App). We intend to have monthly events broadcast through “YippiTV” (which is a function within the Yippi App for video streaming of these publicity events). We may utilize celebrity endorsements from the Philippines, Indonesia, and Malaysia.

 

We have also engaged in a series of branding campaigns, or sponsorships, with selected corporate entities in the Asian region, specifically Southeast Asia. For example, we have partnered with AirAsia Academy in cross-promotion and sponsorship of the academy players in badminton competitions since July 2018. We also sponsored the Panagbenga Flower Festival in the Philippines in February 2019, which festival was the marketing promotion that created brand awareness of the Yippi App throughout Asia.

 

Market Development. Market Development focuses on contests within the Yippi App to connect users to each other and encourage content creation within the Yippi ecosystem. Beginning in May 2018, we have had and continue to have on-going weekly contests via the social function of the Yippi App. The contests encompass questions, quizzes, personal preferences, and favorite pictures, among others, all of which are intended to increase engagement among users through their participation of commenting and sharing on their social walls. The winners are picked based on the criteria of either most creative, most shares, or most “likes” earned. We also hold weekly contests based on the top downloaded “sticker” within the Yippi App, and the designer of the most downloaded sticker for that particular week wins $100. A sticker set may only win once in a month, and only verified sticker designers are eligible to win. Winners are from Malaysia, Indonesia, ROC Taiwan, and the Philippines. Since March 2020, we have held daily non-monetary contests ranking all live streams from Yippi users and awarding the “star of the day” to the Yippi users with the most points based on live stream unique views and rewards earned for each day. Users can create a live stream by live broadcasting to users through the Yippi App. The winner receives “Yellow Beans” (tokens) and a privilege badge (similar to a virtual trophy), with the achievements being unlocked in the winning user’s Yippi profile. Similar contests are held in the Yippi App for celebrations such as Mother’s Day (for the most likes on a photo or video submission) and National Day (for the most creative photo or video post).

 

 
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Scientific Advisory Council. In order to further our market development, in September 2019, we established a Scientific Advisory Council (the “Council”) consisting of Dr. Beverly Rubik, Prof. Dr. Konstantin Korotkov, Deputy Director of Saint-Petersburg Federal Research institute of Physical Culture, and Erick Wayne Thompson of Subtle Energy Sciences, LLC. The members of the Council were retained to provide product ideas and advice on technologies relating to energy, lifestyle and nutrition wellness, as well as to deliver keynote speeches and attend Company events. The members of the Council were each paid an annual fee of $36,000 with additional payments for each keynote presentation. As of the date of this Amended Annual Report, all agreements with the members have expired.

 

Target Market

 

The Yippi App is free for users and can be downloaded through the Apple App Store, Google Play, or the Amazon App Store. We are focused on increasing our users. Currently, our users are concentrated in Indonesia, Malaysia, China, Philippines, Vietnam, and Taiwan. The Yippi App is also available to users in the United States; however, the Toga Resonance Technology (“TRT”) feature within the Yippi App is not available to users in the United States.

  

Competition

 

We compete with companies that focus on mobile social engagement and advertising. Many of these companies, such as Apple; Facebook Inc. (“Facebook”), which owns and operates the applications Facebook, Instagram, and WhatsApp; Tencent Holdings, Ltd., which owns and operates the application WeChat; Snap Inc., which owns and operates the application Snapchat; Google, LLC (“Google”), which owns and operates YouTube; and Twitter, Inc. (“Twitter”), which owns and operates the social networking service known as Twitter, have significantly greater financial and human resources. Our competitors span from internet technology companies and digital platforms to traditional companies in print, radio, and television sectors to underlying technologies like default smartphone messaging. Additionally, our competition for engagement varies by region. The main bases on which we currently compete with competitors include engagement, partnerships, advertising, and talent.

   

We compete by attracting and retaining our users’ attention, both in terms of reach and engagement. We focus on constantly improving and expanding the Yippi App and related features, as described below under “New Product Development.”

 

Finally, we also compete for advertising revenue, especially with respect to video and other highly engaging formats. We believe our ability to compete depends primarily on our reach and ability to deliver a strong return on investment to our advertisers, which is driven by our advertising products, delivery and measurement capabilities, including application programming interfaces, and other tools. The industry in which we operate is changing rapidly and we find ourselves in competition with internet-based platforms, advertising networks, and traditional media.

 

New Yippi Product Development - Subsequent to July 31, 2019

 

Between January and July 31, 2020, we launched new features within the Yippi App to enhance our user experience, including, but not limited to, new TRT features which include relieving fatigue, relaxation and rejuvenation, and enhancements to live streaming, “yellow bean” social tokens, sticker artist profiles, social gamification, leaderboard, daily login reward, “Pong Pong” social networking, web instant messaging, text translation, eShop e-commerce, TogaGo user experience and “Go Cash” rewards points, and in-app Yipps purchasing through the Apple Appstore, Google Playstore, Alipay, and Huawei. “Go Cash” rewards points can be used as credits for users to receive discounts on future bookings made through TogaGo.

 

 
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We also have a number of new features and enhancements to current features in development that we plan to incorporate into the Yippi App in the future, including, but not limited to, eSports live streaming, mini videos, a portal to allow for journalists and blogger content updates, expanded travel features such as train service and airport transfers bookable through TogaGo, and other “mini-programs.” Mini-programs are “sub-applications” within the Yippi App ecosystem, which offer advanced features to users in e-commerce, task management, coupons/offers, brand page, or exclusive content from official accounts. These enhancements provide experiences that are built completely within the Yippi App, for a more complete user experience. Mini-programs are similar to separate applications but because the mini-programs are within the Yippi App, users do not need to separately download each mini-program; thus, the mini-programs do not use any additional storage space on the user’s device. Users may scan quick response, or QR, codes or input the names of the mini-programs in-app to launch them. The success of the mini-programs is dependent upon encouraging talented and independent developers to create these mini-programs that are powered by our Yipp App. We currently anticipate that our mini-programs will be publicly released in 2021. Our newest version of the Yippi App, “Yippi X” was unveiled in January 2021.

 

Yipps Agreements

 

We generate revenue from the sale of Yipps, which are the in-app credit that can be used for purchases, services and tipping within the Yippi App. We use third party entities to distribute Yipps to certain end users, pursuant to Yipps Agreements. Each Yipps Agreement provides that the company purchasing the Yipps can purchase them via a purchase order, for a price set by TOGL Technology, and then distribute the Yipps to their members / agents to be used in the Yippi App. TOGL Technology has the right to change the price of the Yipps from time to time.

 

In May 2019, TOGL Technology entered into Yipps Agreements with each of Agel Enterprise International Sdn. Bhd., Malaysian corporation (“Agel”), Toga Japan Co. Ltd., a Japanese company (“Toga Japan”), and ShenZhen DingShang Network Technology Co. Ltd., a Chinese company (“ShenZhen DingShang”), for the purchase and distribution of Yipps. However, because of COVID-19 pandemic, the Yipps Agreement with Agel was terminated in May 2020.

 

On March 1, 2020 (as amended on July 1, 2020), TOGL Technology entered into a Yipps Agreement with Success Fortune Trading Limited, a Hong Kong company (“Success Fortune”) for the purchase and distribution of Yipps that can be used by the Yippi App users.

 

On June 1, 2020, TOGL Technology entered into a Yipps Agreement with our newly acquired, partially-owned Malaysian subsidiary, Eostre Bhd., for the purchase and distribution of Yipps that can be used by the Yippi App users.

 

Eostre – Products Sold Through Our Direct Marketing Network

 

Recent Changes to the Eostre Business

 

We recently changed our business model for our Eostre business line by bringing the direct marketing sales activities in Asia under our newly acquired, partially-owned Malaysian subsidiary, Eostre Bhd. Beginning on June 1, 2020, independent sales agents in Malaysia and Japan can purchase our “Eostre” branded products directly from Eostre Bhd.

 

 
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Prior Business Structure; Eostre Trademark License Agreements

 

The recent changes to the business model of our Eostre business occurred because of the prolonged effect of the COVID-19 pandemic. Previously, from 2018 until May 31, 2020, we sold our “Eostre” branded products exclusively to independent sales agents in Malaysia, Japan, Taiwan, and Indonesia. We did not sell our products directly to consumers. These independent sales agents distributed our products through direct marketing networks in our principal markets. In Indonesia and Taiwan, we, through our subsidiaries, administered the sale of such products. Independent agents in Indonesia and Taiwan purchase products and earn commission through a point system. In Malaysia, the program for sales was administered by Agel, and, in Japan, by Toga Japan, an unaffiliated third party.

 

Agel and Toga Japan each engaged independent sales agents to sell our products through their respective direct marketing networks. At no time were any of the independent sales agents of Agel or Toga Japan employed by us. In order to sell our products, we granted Agel and Toga Japan certain licensing rights to use our “Yippi App” and “Eostre” trademarks for marketing purposes pursuant to, (i) in the case of Agel, a Trademark License Agreement dated April 1, 2018, as subsequently amended on August 1, 2019 (the “Agel License Agreement”) and (ii) in the case of Toga Japan, a Trademark License Agreement dated April 1, 2019, as subsequently amended on August 1, 2019 (the “Toga Japan License Agreement” and, together with the Agel License Agreement, the “License Agreements”). The License Agreements allowed Agel and Toga Japan to administer the sales programs. As consideration for the licenses, each of Agel and Toga Japan paid us a monthly fee in the amount of $20,000 USD. We also granted our subsidiaries operating in Taiwan and Indonesia licensing rights to use our “Yippi App” and “Eostre” trademarks for marketing purposes pursuant to a Trademark License Agreement dated September 1, 2018 with TOGL Technology’s Taiwan branch and a Trademark License Agreement dated August 1, 2019 with PT Toga Indonesia. As consideration for the licenses, each of TOGL Technology and PT Toga Indonesia paid us a monthly fee in the amount of $20,000 USD.

 

Because of the COVID-19 pandemic and the resulting inability of independent agents to engage with customers in person, neither Agel nor Toga Japan had been able to sell our Eostre products since February 2020. As a result, the License Agreements with Agel and Toga Japan were terminated in May 2020. Because of the COVID-19 pandemic, TOGL Technology’s Taiwan branch requested and received a reduction to the monthly royalty fee to $10,000 per month for each of April and May 2020, and the license agreement with TOGL Technology’s Taiwan branch was terminated in June 2020.

 

Acquisition of Eostre Bhd. - Subsequent to July 31, 2019

 

In connection with the termination of the License Agreements, we decided to operate the direct sales business in Malaysia and Japan ourselves, through our subsidiary, Eostre Bhd., instead of through unaffiliated, third-parties. We anticipate that in the future all independent agents in various jurisdictions throughout Asia will eventually purchase products directly from Eostre Bhd. As a result of this new business model, we (or our subsidiaries, as applicable), hired some of Agel’s former employees to assist us in the operation of our direct marketing sales activities.

 

In order to effectuate this new business model, we are acquiring 100% of the equity of Eostre Bhd. pursuant to two Stock Purchase Agreements, dated March 31, 2020, with Mr. Toh, Mr. Lim, and the two shareholders of Eostre Bhd. (the “Stock Purchase Agreements”), and some other related agreements (the “Acquisition”), for a purchase price of MYR 5 Million (approximately USD $1,250,000) (the “Purchase Price”). The Acquisition is subject to certain approvals by the relevant governmental authorities in Malaysia, which approvals are still being obtained by us.

 

 
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The Acquisition is expected to be completed in two phases to meet certain regulations under Malaysian law. In the first phase, (i) we acquired 20% of Eostre Bhd., consisting of 1,000,000 ordinary shares of stock; (ii) Mr. Toh and Mr. Lim acquired 20% (1,000,000 ordinary shares) and 25% (1,250,000 ordinary shares) of Eostre Bhd., respectively; and (iii) a current owner of Eostre Bhd. acquired the balance of 1,350,000 shares, which, combined with his current ownership of 400,000 ordinary shares, resulted in his owning 35% (1,750,000 ordinary shares) of Eostre Bhd. Mr. Toh, Mr. Lim, and the current owner of Eostre Bhd. are referred to herein as the “Individual Purchasers.”

 

We have deposited the Purchase Price directly into the bank account of Eostre Bhd., which will be controlled by us or our designees subsequent to the closing date of the first phase. Pursuant to the Stock Purchase Agreements, Mr. Toh, Mr. Lim, and the two original owners of Eostre Bhd. are not entitled to receive any profit in connection with the Acquisition. The Individual Purchasers executed demand notes in favor of us for their respective portions of the Purchase Price. Such demand notes bear interest at a rate of 4% per annum. In addition, the Individual Purchasers each executed a security and pledge agreement in favor of us pledging their shares in Eostre Bhd. as collateral, until such time as the second phase of the Acquisition is completed. The Individual Purchasers also granted irrevocable proxies to us to vote their shares in Eostre Bhd. until such time as the second phase of the Acquisition is completed. As such, we currently hold 100% voting control of Eostre Bhd.

 

In the second phase of the Acquisition, set to begin on February 21, 2021, the promissory notes issued by the Individual Purchasers will be cancelled and deemed paid in full, and the remaining 80% of the equity in Eostre Bhd. will be transferred to us. The second phase of the Acquisition is expected to close as soon as practicable after the six-month anniversary of the signing date of the Stock Purchase Agreements, based on the expected timing required to obtain the necessary approvals from the Malaysian Ministry of Trade.

 

At the time of the of completion of the first phase of the Acquisition, Eostre Bhd. was considered a shell entity with no current business or operations. Its sole asset is a direct selling license (the “License”) to operate a business in the “direct sales” space in Malaysia. Subject to the “Direct Sales and Anti-Pyramid Scheme Act 1933,” this License is a pre-requisite to operating a company in the direct sales space in Malaysia. The expiration date of the License is November 21, 2021; however, we anticipate that we will renew the License at such time. The License will allow us to operate the direct sales business directly, instead of through unaffiliated, third-parties.

 

Business in China

 

On June 1, 2020, we entered into a Collaboration Agreement (the “ShenZhen Yi Yi Collaboration Agreement”) with ShenZhen Yi Yi Technology Private Limited, a company registered in China (“ShenZhen Yi Yi”), for provision of certain services to us and our subsidiaries within the territory of the Peoples’ Republic of China (the “Territory”). The ShenZhen Yi Yi Collaboration Agreement memorialized the parties’ understanding with respect to the provisions of these services, which began in March 2020. Pursuant to the ShenZhen Yi Yi Collaboration Agreement, within the Territory, ShenZhen Yi Yi agreed to provide us with web hosting services, launch and release our apps, act as our exclusive proxy to promote our products and services, protect our trademarks, products and apps from unauthorized use, and make payments on behalf of the company to third-parties. The ShenZhen Yi Yi Collaboration Agreement grants ShenZhen Yi Yi a non-exclusive, non-sublicensable, and non-transferable right to use our trademarks. In consideration for the aforementioned services, we agreed to pay ShenZhen Yi Yi monthly consideration of RMB 200,000. Pursuant to a letter of authorization, dated March 1, 2020, which had the effect of amending the ShenZhen Yi Yi Collaboration Agreement, TOGL Technology granted ShenZhen Yi Yi the right to sell Yipps to users in the Territory, with 30% of the total amount of the selling price for such Yipps sold payable to ShenZhen Yi Yi as commission. In addition, on June 1, 2020, Eostre Bhd. also began collaborating with ShenZhen YiYi for the sale of Eostre Bhd.’s products in the Territory. This collaboration has not been memorialized in writing yet between Eostre Bhd. and ShenZhen YiYi.

 

 
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Industry Overview

 

Since the 1990s, the use of direct selling and network marketing sales channels has grown in popularity and general acceptance, including acceptance by prominent investors and capital investment groups who have invested in direct selling companies. In addition, many large corporations have diversified their marketing strategy by entering the direct selling arena. Several consumer-product companies have launched their own direct selling businesses with international operations and often accounting for the majority of their revenues. Consumers and investors are beginning to realize that direct selling provides unique opportunities and a competitive advantage in today’s markets. Businesses like us are able to quickly communicate and develop strong relationships with our customers, bypass expensive ad campaigns, and introduce products and services that would otherwise be difficult to promote through traditional distribution channels such as retail stores.

 

According to the worldwide direct sales data published by the World Federation of Direct Selling Association, in 2019, approximately 118 million global direct sellers collectively generated annual retail sales of $180.4 billion, of which approximately 44% of total annual sales, or $78.9 billion, are generated in the Asia/Pacific marketplace by approximately 68.4 million independent sales agents operating in the Asia/Pacific marketplace.

 

Products and Market

 

Beginning on June 1, 2020, we sell our Eostre products directly to independent sales agents, that then sell to their customers through direct marketing networks. Prior to June 1, 2020, we licensed the “Eostre” brand to Agel and Toga Japan, both of which had direct marketing networks in Malaysia and Japan. We also sold Eostre products directly to independent sales agents to sell within the agents’ own networks in Taiwan and Indonesia. We continue to rely on the revenues generated from our Eostre business to sustain the development of our Yippi App.

 

Our Eostre products are based on traditional, eastern wellness principles. We sell both physical products and digital products online (eostre.biz), through our “E-Booster” App, and through direct marketing networks. Our products include pendants (necklaces with crystals on them), home goods, personal care products (supplements, topical sprays, serums, and creams), and digital downloads. We offer the following physical products:

 

Product

 

Product Category

 

Available Markets

 

Manufactured

Eostre Energy Crystal Pendant

 

Pendant

 

Indonesia, Taiwan, Malaysia, and Japan

 

Korea

Eostre Quantum Disc

 

Pendant

 

Indonesia, Taiwan, Malaysia, and Japan

 

Korea

Eostre Vitality Pendant

 

Pendant

 

Indonesia and Malaysia

 

China

Eostre Sanare Sleep Mat

 

Home good

 

Indonesia and Malaysia

 

Korea

Eostre Life Force Diffuser (humidifier)

 

Home good

 

Indonesia and Malaysia

 

China

Eostre Ohrus (light)

 

Home good

 

Malaysia

 

China

Eostre Smart LED Desk Lamp

 

Home good

 

Available in Malaysia in September 2019, but since discontinued

 

China

Essential Young Serum

 

Personal care

 

Indonesia

 

Indonesia

Perfect Hydrating Spray

 

Personal care

 

Indonesia

 

Indonesia

Healthy 99

 

Personal care

 

Taiwan and Japan

 

Taiwan

Beauty 99

 

Personal care

 

Taiwan

 

Taiwan

Cadalobs Chlorella

 

Personal care

 

Taiwan

 

Taiwan

Toga Dammarane

 

Personal care

 

Taiwan

 

Taiwan

Dammarane Sapogenin

 

Personal care

 

Japan

 

Taiwan

 

 
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We also offer digital downloads and applications that use our “Toga-Resonance Technology” (“TRT”). TRT is part of our wellness program and is designed to be a solution for electric and magnetic field (“EFM”) radiation, or emissions from wireless products or powered items. For example, our “headache” program application includes soothing nature sounds with video and a digital image for a user to use as his or her phone wallpaper.

 

Our TRT digital downloads are available online at eostre.biz and through our Yippi App (for our non-U.S. users) and our “E-Booster” App (branded as “eT-RT” when delivered in connection with our Eostre brand), although such digital products are not available to users located in the United States. E-Booster is a digital wellness app that delivers wellness-focused digital downloads of images, audio, and videos to users’ electronic devices, which are also available for download on the eostre.biz website.

 

Marketing Strategy

 

We, and our subsidiaries, rely on our network of independent sales agents to sell our Eostre branded products in our various jurisdictions. The independent sales agents are eligible to receive compensation on a number of different levels, ranging from retaining profit from retail sales to bonuses, which may be achieved as each such agent becomes a leader of their own network.

 

Independent sales agents purchase points packages from the Company, which can be used to purchase packages of products to then be sold to end users. Independent sales agents also distribute points that they have purchased from the Company to other independent sales agents within their direct marketing networks (their down-line, as described below), who then also use such points to purchase packages of products and then sell such product to end users.

 

Enrolling new independent sales agents creates multiple levels in our direct selling structure. The independent sales agents that are enrolled by other independent sales agents within our network are referred to as “sponsored” independent sales agents, who may purchase product with their points packages solely for their own personal consumption, for resale, or both. Persons newly enrolled are assigned into network positions that can be “under” other independent sales agents, and thus they can be called “down-line” independent sales agents. If down-line independent sales agents also enroll new independent sales agents, they create additional levels within the structure, but their down-line independent sales agents remain in the same down-line network as the original independent sales agent that introduced them to our business.

 

While we provide informational brochures and other sales materials, independent sales agents are primarily responsible for enrolling and educating their new down-line sales agents with respect to products, the compensation plan and how to build a successful direct marketing network.

 

Independent sales agents are not required to enroll other sales agents as their down-line, and we do not pay any commissions for enrolling new independent sales agents. Enrollment in our direct marketing network is contingent upon an independent sales agent purchasing a points package. However, because of the financial incentives provided to those who succeed in building a direct marketing network that consumes and resells products, we believe that many of our independent sales agents attempt, with varying degrees of effort and success, to enroll additional sales agents in their respective direct marketing networks.

 

 
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Our Company policies and procedures establish the rules that independent sales agents must follow in each market. Independent sales agents’ presentations to customers must be consistent with, and limited to, the product claims and representations made in our literature. Independent sales agents are not entitled to use our trademarks or other intellectual property without our prior consent. If we are made aware of unapproved materials being used, we notify and direct the relevant independent sales agents to cease using such materials. We provide training materials to our independent sales agents to ensure compliance with our Company policies and to prevent unauthorized publications and/or sales practices from independent sales agents. An example of such a training and compliance presentation for independent sales agents was included in the Company’s Current Report on Form 8-K/A, filed on June 9, 2020, as Exhibits 99.1 (“The Importance of Optimization and Compliance”) and 99.2 (“A country we have national laws, at home we have house rules”).

 

In light of the current COVID-19 pandemic, we anticipate that Eostre Bhd.’s independent sales agents will primarily use e-commerce as their main sales channel. We intend to pursue paid marketing opportunities, such as Facebook ads with targeting marketing, and hiring product ambassadors to promote our products. In addition, we intend to pursue organic marketing strategies such as using social media accounts and search engine optimization to promote the products.

 

Target Market

 

Independent sales agents sell our products to wellness-minded consumers, typically adults between the ages of 20 and 80 years old, within their sales network. These consumers include both men and women, located in urban centers throughout Asia, including in Malaysia, China, Taiwan, Indonesia, and the Philippines.

 

Competition

 

We purchase white labeled products and brand them with the “Eostre” trademark. We then produce sales and marketing materials for such products. Because we own the Eostre brand, we have no competitors selling identically branded products without our authorization. However, we do not own the underlying intellectual property to the products that we sell, nor do we have exclusive rights to sell such products. We have competition risk in that we cannot ensure that we will continue to be able to source our products from our third-party suppliers, at competitive prices.

 

In addition, we are aware that those third-party suppliers sell the same white labeled products to other companies (with different branding applied), who compete directly or indirectly with us in our principal markets. Except for the “Eostre” product branding and marketing, we are aware of one such competitor who sells identical products (with the competitor’s own marketing and branding applied to the underlying product) to the Eostre Energy Crystal Pendant, Eostre Vitality Pendant, Eostre Quantum Disc, Eostre Ohrus, Eostre Life Force Diffuser, Essential Young Serum, and Perfect Hydrating Spray. This provides additional direct sales competition with respect to those products and provides competition for talent for those independent sales agents who may want to sell these or similar wellness products through a direct marketing network.

 

Furthermore, we have competition in each jurisdiction in which we operate with the entire market of other companies and individuals who sell health and wellness products, especially those that are in the business of selling natural products (including crystals, topical sprays, serums and cremes, home goods, supplements, and similar items) based on traditional, eastern wellness principles.

 

 
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Manufacturing

 

The Eostre products are manufactured by unaffiliated third-party companies, who ship finished products containing our Eostre branding. We receive fully manufactured products from the manufacturers, which we sell through wholesale distribution to independent sales agents who have their own respective direct marketing networks for selling the products.

 

Collaboration Agreements

 

From time to time, TOGL Technology enters into collaboration agreements with third parties to allow such parties to provide their services or sell their products on the Yippi App or in connection with Eostre products or the E-Booster App.

 

On May 1, 2020, we entered into a Supplier Agreement (the “Subtle Supplier Agreement”) with Subtle Energy Sciences, LLC, an Indiana limited liability company (“Subtle”), where Subtle agreed to provide us with an “Immunity” app developed by Subtle which included digital files, videos, audio files and images. Pursuant to the Subtle Supplier Agreement, we were granted the exclusive right to publish and market the app worldwide. We paid Subtle a one-time sum of $30,000 as consideration under the Subtle Supplier Agreement. In connection with the Subtle Supplier Agreement, we entered into a mutual agreement, dated May 15, 2020, with Dr. Anura Gnanasothi Kandasamy, a Malaysian individual (“Dr. Anura”), who agreed to act as Subtle’s agent under the Subtle Supplier Agreement and guarantee the delivery of Subtle’s obligations thereunder, including the delivery of a scientific report in connection with Subtle’s app, in exchange for a 10% commission from the total consideration payable under the Subtle Supplier Agreement. On June 1, 2020, we entered into a Collaboration Agreement (the “Subtle Collaboration Agreement”) with Subtle, for a period of two (2) years, which grants us the exclusive right in Asia and certain parts of the Middle East to market and sell Subtle’s products on our websites and mobile applications. We pay Subtle a monthly fee of the greater of 1% of gross sales of Subtle’s products or $16,000, per month. In connection with the Subtle Collaboration Agreement, we entered into a mutual agreement, dated June 1, 2020, with Dr. Anura, who agreed to act as Subtle’s agent under the Subtle Collaboration and guaranteed the delivery of a scientific report in connection with each of the 12 expected Subtle products to be delivered over the term of the Subtle Collaboration Agreement, in exchange for a 10% commission from the total consideration payable to Subtle under the Subtle Collaboration Agreement.

   

On June 1, 2020, TOGL Technology entered into a Collaboration Agreement (the “Redbox Collaboration Agreement”) with Redbox Holdings Berhad, a Malaysian company (“Redbox”). On November 16, 2020, TOGL Technology entered into an App Development and Services Agreement with Redbox (the “Redbox App Development Agreement”). Redbox provides karaoke entertainment to the public via rentable rooms at public spaces such as shopping malls, where the public can book a karaoke room to sing. Pursuant to the Redbox Collaboration Agreement, TOGL Technology allows end users to purchase Redbox’s products within the Yippi App, using Yipps as the form of payment. Redbox may also promote its product, including providing discounts or promotions within the Yippi App. Both parties also have agreed to collaborate to expand each party’s respective business. The Redbox Collaboration Agreement grants a non-exclusive, non-sublicensable, and non-transferable right to use our Yippi trademarks, and we have a reciprocal right to use Redbox’s trademarks. The trademarks are not to be used for any purpose other than the purpose of the Redbox Agreement without our, or Redbox’s, prior written consent, as applicable. Only Yipps can be used for paying for Redbox services or products, such as paying for karaoke rooms. Redbox pays TOGL Technology a portion of each transaction that utilized Yipps as the payment form. Each unit of Yipps is equivalent to RM 0.60, however, the value of each unit may be changed from time to time in the discretion of TOGL Technology. The initial term of the Redbox Collaboration Agreement expires on June 1, 2021 and automatically renews for an additional one-year term, unless either party provides notice to the other of its intention not to renew at least 30 days prior to the end of the initial term. Pursuant to the Redbox App Development Agreement, TOGL Technology provides development and servicing of a social karaoke app for Redbox, and, in exchange, Redbox will pay TOGL Technology RM 1,000,000.00 for such services, payable in installments upon completion of certain milestones as set forth in the Redbox App Development Agreement.

 

 
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On June 1, 2020, TOGL Technology entered into a Collaboration Agreement (the “Gintell Collaboration Agreement”) with Gintell Rest N Go Sdn Bhd, a Malaysian company (“Gintell RNG”). On July 21, 2020, TOGL Technology entered into a Yippi E-Shop Collaboration Agreement (the “Gintell E-Shop Agreement”) with Gintell Irest Sdn. Bhd., a Malaysian company and affiliate of Gintell RNG (“Gintell Irest” and, collectively with Gintell RNG, the “Gintell Companies”). On March 2, 2020, TOGL Technology also entered into a Sponsorship Agreement with Gintell Irest for the provision of certain of Gintell Irest’s products at two of our live streamed events broadcast on the Yippi App (the “Gintell Sponsorship Agreement”). The Gintell Companies are a healthcare retail chain store in Malaysia, which provides massage, exercise, and wellness products, such as massage chairs that are installed in public spaces and available for booking and use by customers in exchange for a fee. Pursuant to the Gintell Collaboration Agreement, TOGL Technology allows end users to purchase Gintell RNG’s products within the Yippi App, using Yipps as the form of payment. Pursuant to the Gintell E-Shop Agreement, Yippi users may also purchase Gintell Irest’s products through the Yippi App’s online E-Shop. The Gintell Companies may also promote its products, including providing discounts or promotions within the Yippi App. Both TOGL Technology and the Gintell Companies also have agreed to collaborate to expand each party’s respective business. Both the Gintell Collaboration Agreement and the Gintell E-Shop Agreement grant the Gintell Companies a non-exclusive, non-sublicensable, and non-transferable right to use our Yippi trademarks, and we have a reciprocal right to use the Gintell Companies’ trademarks. The trademarks are not to be used for any purpose other than this purpose without our, or the Gintell Companies’, prior written consent, as applicable. Yipps are intended to be the sole payment form accepted for Gintell RNG’s customers purchasing services or products, such as by using Yipps at a massage chair to redeem massage time and services. Under the Gintell Collaboration Agreement, Gintell RNG pays TOGL Technology a portion of each transaction that utilized Yipps as payment. Each unit of Yipps is equivalent to RM 0.60, however, the value of each unit may be changed from time to time in the discretion of TOGL Technology. Under the Gintell E-Shop Agreement, TOGL Technology may retain 15% from the sale of each of Gintell Irest’s products. The initial term of the Gintell Collaboration Agreement expires on June 1, 2021 and automatically renews for an additional one-year term, unless either party provides notice to the other of its intention not to renew at least 30 days prior to the end of the initial term. The Gintell E-Shop Agreement expired on January 21, 2020, and may be renewed by mutual written agreement of the parties. The Gintell Sponsorship Agreement expired on December 31, 2020 and the Company is in the process of renewing the agreement.

 

 

On August 11, 2020, TOGL Technology entered into a Yippi E-Shop Collaboration Agreement (the “Ideahom E-Shop Agreement”) with Ideahom Global Enterprise, a Malaysian company (“Ideahom”). Ideahom sells household appliance products, kitchen products and electrical appliances. Pursuant to the Ideahom E-Shop Agreement, Yippi users may purchase the Ideahom’s products through the Yippi App’s online E-Shop. The Ideahom E-Shop Agreement grants a non-exclusive, non-sublicensable, and non-transferable right for us to use Ideahom’s trademarks for promotion and sales within the Yippi App with Ideahom’s prior written consent. As consideration for featuring Ideahom’s products in the Yippi App’s E-Shop, TOGL Technology may retain a certain percentage from the sale of each of Ideahom’s products. The Ideahom E-Shop Agreement will expire on February 10, 2021 and will not be renewed.

 

 
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Other Agreements

 

On June 1, 2020, TOGL Technology entered into a Talent Agency Appointment Agreement with De Top Entertainment, a Malaysian Company (“DTE Agency”), for services of Yumi Wong, an artist who works for DTE Agency, to be a promoting ambassador of the Yippi App and our other products and services. The agreement expires on May 31, 2021.

 

On July 1, 2020, TOGL Technology entered into a Research Grant Agreement (“Research Agreement”) with Universiti Telekom Sdn. Bhd., a Malaysian company (“UTSB”), which is the registered owner of Multimedia University, a private university that offers tertiary level education in multimedia and technology, among other subjects. TOGL Technology agreed to sponsor and fund a research project to be conducted by PhD postgraduate students attending UTSB to study the effects of extremely low frequency electric fields on cancer cells and normal cells (the “Project”). The Research Agreement expires on June 1, 2023. TOGL Technology agreed to provide RM 221,180 in three yearly installments of RM 118,580, RM 51,300, and RM 51,300 payable pursuant to certain milestones set forth in the Research Agreement. In exchange, TOGL Technology will own 90% of any intellectual property developed in connection with the Project, with UTSB owning the remaining 10%. TOGL Technology will be solely entitled to commercialize the intellectual property developed under the Project, and any profits derived from the commercialization will be divided in proportion to the parties’ respective ownership percentages of the intellectual property.

 

On January 1, 2020, we entered into a Service Agreement (the “SNA Service Agreement”) with Social Networking Association (“SNA”), whereby SNA agreed to present ten-minute multi-media presentations about us to 1,000 individuals over a period of 90 days. We agreed to pay SNA an aggregate of $30,000 in three installments of $10,000 payable on January 1, February 1, and March 1, 2020. SNA is directed by Jim Lupkin, a member of our Board. Mr. Lupkin was in charge of performing services on behalf of SNA under the SNA Service Agreement. Beginning in June 2020, Mr. Bratt, another member of our Board, was appointed the Executive Vice President and Chief Operating Officer of SNA.

    

Advertising Agreements

 

During the fiscal year ended July 31, 2020, we entered into agreements with six different companies to provide advertising services for them on our Yippi app. Pursuant to these agreements, we generated an aggregate of approximately $100,000 per month. As of January 29, 2021, five of these agreements are still in effect.

 

Intellectual Property

 

“Toga” Name

 

Historically, we have not sought any intellectual property protection with respect to “Toga,” nor have we attempted to stop third-parties from using the word “Toga” in their names. We are currently pursuing a trademark for our Company name in connection with our slogan, “TOGA We Build The Next Generation,” in Malaysia and the Philippines.

 

Yippi App

 

We are the registered owner of certain trademarks in Malaysia, Indonesia, and China, including, but not limited to the trademark “Yippi,” and the Yippi App “Duck” logo, and we are pursuing trademark registrations in additional jurisdictions. We have registered trademark for “TogaGo” in Malaysia and are pursuing trademark registrations in additional jurisdictions. We regard our marks as important to our business due to name recognition. We are not aware of any claims of infringement or challenges to our right to use any of our marks.

 

 
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Eostre

 

The product branding “Eostre” is owned by us. We have a registered trademark for “Eostre” in Malaysia and are pursuing trademark registrations in additional jurisdictions. Until May 31, 2020, we licensed the brand “Eostre” to third-party companies with direct marketing networks in Malaysia and Japan (as described above), while we sold branded products directly to independent sales agents to sell within the agents’ own networks in Taiwan and Indonesia. Since June 1, 2020, the Company only sells branded products directly to independent sales agents to sell within the agents’ own networks located throughout Asia, including in Malaysia, China, Taiwan, Indonesia and the Philippines.

 

On June 1, 2020, we entered into an intercompany agreement granting a non-exclusive, non-sublicensable, and non-transferrable license to our trademarks to our partially-owned subsidiary, Eostre Bhd. (the “Eostre Bhd. Intercompany Agreement”). Pursuant to the Eostre Bhd. Intercompany Agreement, Eostre Bhd. may use our trademarks on products that will be manufactured, sold, and/or distributed by Eostre Bhd., on marketing materials, and for events organized by Eostre Bhd. The term of the Eostre Bhd. Intercompany Agreement is one year, with the agreement automatically renewing for additional one-year terms, unless either party provides notice to the other of its intention to terminate the license agreement within 60 days before the beginning of the next term. In consideration for the license, Eostre Bhd. will pay us a fee of $20,000 on a monthly basis.

 

Governmental Regulation

 

We are subject to a variety of laws and regulations in the United States and other countries that involves matters central to our business, including but not limited to the Foreign Corrupt Practices Act (“FCPA”), laws regarding consumer protection, intellectual property, export, and national security. Many of these laws and regulations are still evolving and could be interpreted or applied in ways that could limit our business or require us to make certain fundamental and potentially detrimental changes to the products and services we offer. For example, laws relating to the liability of providers of online services for activities of their users and other third-parties are currently being tested by a number of claims, including actions based on invasion of privacy and other torts, unfair competition, copyright, and trademark infringement, and other theories based on the nature and content of the materials searched, the ads posted or the content provided by users. Furthermore, the introduction of new products or services in our existing markets and the expansion of our business to other countries may subject us to additional laws and regulations, among others resulting from the need to obtain additional licenses and approvals to conduct our businesses as envisioned.

 

Our Eostre and TRT products are not currently offered in the United States. Should we choose to do so, we will have to comply with all rules and regulations of the U.S. Food and Drug Administration (“FDA”). The processes by which regulatory approvals are obtained from the FDA and foreign regulatory authorities to market and sell a new product are complex, require a number of years, depend upon the type, complexity, and novelty of the product candidate, and involve the expenditure of substantial resources for research, development, and testing. In addition, if we were to market our products in additional foreign jurisdictions, we may be required to obtain separate regulatory approvals in each country. The approval procedure varies among countries and can involve additional testing, and the time required to obtain approval may differ from that required to obtain FDA approval.

 

 
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On January 4, 2018, the Federal Trade Commission (the “FTC”) issued “Business Guidance Concerning Multi-Level Marketing” a non-binding guidance in question-and-answer format clarifying the FTC’s enforcement position regarding multi-level marketing. The guidance focuses on the characteristics of multi-level marketing and delineates the factors that the FTC staff is likely to consider in assessing whether or not a compensation structure is unlawful. The FTC has broad enforcement authority under Section 5 of the Federal Trade Commission Act (the “FTC Act”) to prohibit “unfair and deceptive” acts and practices. While the FTC’s guidance regarding multi-level marketing does not have the force of law and is not binding on the FTC or a court, the FTC will rely on such guidance in order to determine whether a compensation structure is unfair or deceptive in violation of Section 5 of the FTC Act. As a result, the FTC could decide to investigate or bring an enforcement action regarding practices that we interpret to be in line with applicable law and/or FTC guidance. For example, the FTC has challenged the distributor compensation plans used by other multi-level-marketing companies over the last few years. The FTC obtained consent decrees with those companies requiring those companies to (i) discontinue using all, or certain components of, their compensation plans; and (ii) implement a compensation plan that received prior approval from the FTC.

 

In 2019, the FTC continued to challenge compensation plans and structures within the direct selling channel. In October 2019, following ongoing discussions with the FTC pertaining to an enforcement action, one of our competitors changed its business model from multi-level-marketing to direct-to-consumer as part of a stipulated order for permanent injunction. While consent decrees and orders entered into by our competitors are not binding on us, it does provide an insight into the FTC’s priorities regarding its interpretation and enforcement of regulations pertaining to the multi-level-marketing business model.

 

The FTC also scrutinizes and has challenged false and misleading claims made by multi-level-marketing programs about the health benefits of the products being sold and about the earnings people who participate in a multi-level marketing program have made under its broad Section 5 authority. Since March 2020, the FTC has sent numerous warning letters to multi-level marketers about health claims and income earning claims that the FTC believes are false and deceptive. We do not believe our Eostre business is subject to the laws of the United States; however, it is possible that our interpretation of the laws is incorrect.

 

Concentration of Customer Risk

 

In fiscal 2019, we had sales to one customer that comprised an aggregate of approximately 23% of our annual revenue. In fiscal 2018, we had sales to two customers that comprised an aggregate of approximately 88% of our annual revenue, with one customer at 45% of our sales and another customer at 43% of our sales.

 

In fiscal 2019, 96% of our net revenue was derived from sales outside of the U.S., with 51% of our foreign sales derived from customers in Malaysia and 45% in Indonesia. In fiscal 2018, 100% of our net revenue was derived from sales outside of the U.S., with 100% of our foreign sales derived from customers in Malaysia.

 

Employees

 

As of January 31, 2021, we had 158 employees, all full-time equivalent, with 2 in the United States, 153 located in Malaysia, 4 located in Indonesia, and 1 located in Vietnam. We also maintain a team of independent sales agents to sell Eostre branded products. Any employee additions or terminations over the next twelve months will be dependent upon our need during fiscal 2021. We have used and will continue utilizing part-time help, including interns, temporary employment agencies, and outside consultants, where appropriate, as required from time to time. None of our employees are represented by a labor union.

 

 
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Item 1A. Risk Factors.

 

There are numerous factors that affect our business and operating results, many of which are beyond our control. The following is a description of significant factors that might cause our future results to differ materially from those currently expected. The risks described below are not the only risks facing our Company. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also affect our business operations. If any of the following risks actually occur, our business, financial condition, results of operations, cash flows and/or our ability to pay our debts and other liabilities could suffer. As a result, the trading price and liquidity of our securities could decline, perhaps significantly, and you could lose all or part of your investment. The risks discussed below also include forward-looking statements and our actual results may differ substantially from those discussed in these forward-looking statements. See the section entitled “Cautionary Note Concerning Forward-Looking Statements.”

 

RISKS RELATED TO OUR BUSINESS AND OUR FINANCIAL CONDITION

 

We have never been profitable and may never achieve or sustain profitability.

 

We operate within two primary lines of business – our Yippi App business, which focuses on the development of a social media app, and our Eostre business, which focuses on the sale of products based on traditional, eastern wellness principles under our “Eostre” brand through a direct marketing network. We have a limited operating history. Currently, our primary focus is the development of the Yippi App and the attraction of active users, both of which require continuous and increasing expenses, however, we are also in the business of selling wellness products through a direct marketing platform, which depends largely on our ability to attract and retain a large active base of independent agents as well as customers. Currently, most of our revenue is generated by our Eostre business. Both business lines require significant salary and wages expenses, including commissions and incentives. We have never been profitable and we may never become profitable on a continuous basis in the foreseeable future. Further, we cannot be certain that our existing cash reserves will be sufficient to sustain our operations until we achieve profitability. As of July 31, 2019 and 2018, our cash and cash equivalents held in bank accounts totaled $15 million and $1.1 million respectively.

 

In the event that we require additional capital, our ability to raise such additional capital may be dependent upon various factors, including our past financial performance. The audited consolidated financial statements for the years ended July 31, 2019 and 2018, were prepared under the assumption that we would continue our operations as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Without additional funds from sales of equity instruments; traditional financing, such as loans; obtaining capital from management and significant stockholders; sales of our wellness products, and sales of advertising, emoji stickers, and special filters, effects and features for use with the Yippi App, we may exhaust our resources and may be unable to commence other portions of our operating plan.

 

We have incurred losses since our inception, have yet to achieve profitable operations and anticipate that we will continue to incur losses for the foreseeable future.

 

Our accumulated deficit as of July 31, 2019 is $24.6 million. We plan to continue to increase our expenses associated with the development of our social media business and our direct marketing business. There is no assurance we will be able to derive revenues from the exploitation of either of our business lines to successfully achieve positive cash flow or that either of our business lines will be successful. In addition, we expect to make significant investments in growing our business. These investments, while increasing our expenses, may not result in an increase in revenues or growth in our business. We cannot provide assurances that we will achieve profitable operations in the future. If we achieve profitability, we may be unable to sustain or increase profits on a quarterly or annual basis.

 

 
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We believe that long-term profitability and growth will depend on our ability to:

 

 

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develop and grow our social media business;

 

 

 

 

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develop and grow our direct marketing business; or

 

 

 

 

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engage in any alternative business.

 

Inability to successfully execute on any of the above, among other factors, could have a material adverse effect on our business, financial results, or operations.

 

We identified a material weakness in our internal control over financial reporting. If we do not adequately address this material weakness or if other material weaknesses or significant deficiencies in our internal control over financial reporting are discovered, our financial statements could contain material misstatements and our business, operations and stock price may be adversely affected.

 

As disclosed under “Item 9A. Controls and Procedures” of this report, our management has identified a material weakness in our internal control over financial reporting at July 31, 2019. Under standards established by the Public Company Accounting Oversight Board, a material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our financial statements will not be prevented or detected on a timely basis. Although no material misstatement of our historical financial statements was identified, the existence of this or one or more material weaknesses or significant deficiencies could result in material misstatements in our financial statements and we could be required to restate our financial statements. Further, significant costs and resources may be needed to remediate the identified material weakness or any other material weaknesses or internal control deficiencies. If we are unable to remediate, evaluate, and test our internal controls on a timely basis in the future, management will be unable to conclude that our internal controls are effective and our independent registered public accounting firm will be unable to express an unqualified opinion on the effectiveness of our internal controls. If we cannot produce reliable financial reports, investors may lose confidence in our financial reporting, the price of our common stock could be adversely impacted and we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which could negatively impact our business, financial condition and results of operations.

 

If we are not able to maintain our “Yippi” brand, our “Eostre” brand, or further develop widespread awareness of either brand cost-effectively, our ability to expand our user base or customer base, as applicable, may be impaired, and our business may suffer.

 

We believe that developing and maintaining awareness of our brands in a cost-effective manner is critical to achieving widespread acceptance of our Yippi App and Eostre products, and attracting new users or customers, as applicable. Many of our new users or customers are referred by existing users or customers and, therefore, we strive to ensure that our users or customers are satisfied with our products and services and otherwise remain favorably inclined toward our Yippi App and Eostre products. Maintaining and enhancing our brands will depend largely on our ability to continue to provide simple, user-friendly, reliable, trustworthy, and innovative products and services, which we may not do successfully. Brand promotion activities may not generate consumer awareness or result in revenue and, even if they do, any revenue may not offset the expenses we incurred in building our brands.

 

 
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In addition, our brands can be harmed if our users, in the case of the Yippi App, or our customers, in the case of the Eostre products have a negative experience. Our Yippi App may contain undetected errors, “bugs,” flaws, corrupted data, outages, security breaches, negative media, or violations of laws. Our Eostre products may not perform as expected, or harm our customers. Maintaining and enhancing our brands may require us to make substantial investments and these investments may not be successful. We may also fail to adequately support the needs of our users or customer, which could erode confidence in our brands. If we fail to successfully promote and maintain the Yippi brand or Eostre brand, or if we incurred excessive expenses in this effort, our business, financial condition, and results of operations may be adversely affected and we may fail to achieve the widespread brand awareness that is critical for broad user adoption of our Yippi App or expanding sales of our Eostre products.

 

If we are unable to maintain a good relationship with Apple, Google, Amazon Web Services (“AWS”), Alibaba Cloud (Malaysia) Sdn. Bhd. (“Alibaba”), and any other third-party suppliers, it will negatively affect our operations and our business will suffer.

 

Apple’s “App Store” and Google’s “Google Play” are our primary distribution, marketing, and promotion platforms for our Yippi App, while we rely heavily on AWS and Alibaba for data storage purposes and also other third-party suppliers for our camera features. For instance, Hangzhou Xiangxin Technology Co. Ltd. one of our suppliers that provides us “Face Unity” special facial effect software, which includes avatars, animations, and beauty camera functions. We rely heavily on their support for these particular camera features. Hence, any deterioration in our relationship with Apple, Google, AWS, Alibaba, or other third-party suppliers would harm our business and adversely affect the value of our stock.

 

We are subject to Apple’s, Google’s, and AWS’ standard terms and conditions for application developers, which govern the promotion, distribution, and operation of mobile applications on their respective platforms. We are also subject to certain standard terms and conditions with AWS and Alibaba related to data storage purposes.

 

Our business would be harmed if:

 

 

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Apple, Google, AWS, or Alibaba discontinued or limited our access to any of their platforms;

 

 

 

 

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Apple or Google removed the Yippi App from either of their stores;

 

 

 

 

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Apple, Google, AWS, Alibaba, or any of our third-party suppliers terminate or seek to terminate our contractual relationships;

 

 

 

 

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Apple, Google, AWS, Alibaba, or any other third party suppliers modify their terms of service or other policies, including fees charged to, or other restrictions imposed on us, or if they changed how the personal information of their users is made available to application developers on their platform or shared by users from Apple’s, Google’s, AWS’ or Alibaba’s strong brand recognition and large user base.

 

If Apple, Google, AWS or Alibaba lose their market position or otherwise fall out of favor with internet users, we would need to identify alternative channels for marketing, promoting, and distributing the Yippi App, which would consume substantial resources and may not be effective. In addition, Apple, Google, AWS, and Alibaba have broad discretion to change their terms of service and other policies with respect to us, and those changes may be unfavorable to us. Therefore, we believe that maintaining successful partnerships with Apple, Google, AWS, Alibaba, and other third-party suppliers is critical to our success.

 

 
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We have limited experience in operating a direct sales network.

 

Prior to June 2020, we licensed the “Eostre” brand to Agel and Toga Japan, which had direct marketing networks in Malaysia and Japan, and sold “Eostre” branded products directly to independent sales agents to sell within the agents’ own networks in Taiwan and Indonesia. Beginning in June 2020, we brought this business in-house and now, through our partially-owned subsidiary, Eostre Bhd., operate direct marketing sales programs in Malaysia and Japan. We have limited experience in operating direct marketing sales programs. Our future growth and profitability will depend on the successful operation of this program and our ability to recruit and maintain sales agents that sell our Eostre products in these markets.

 

We may not obtain or maintain the necessary licenses and authorizations to operate our direct marketing business.

 

We are in the process of acquiring Eostre Bhd. for the sole purpose of obtaining the License to operate a business in the “direct sales” space in Malaysia. Subject to the “Direct Sales and Anti-Pyramid Scheme Act 1933,” this License is a pre-requisite to operating a company in the direct sales space in Malaysia. The expiration date of the License is November 21, 2021. We anticipate that we will renew the License at such time; however, we may not be able to obtain a renewal of the License at that time, or may only be able to do so at great cost.

 

In addition, in the future, we may be required to obtain and maintain licenses, authorizations, or permits in other jurisdictions in which we are currently conducting or desire to conduct our direct marketing business. We may not be able to obtain or maintain the necessary licenses, authorizations, or permits for our direct marketing business, or may only be able to do so at great cost. In addition, we may not be able to comply fully with the wide variety of laws and regulations applicable to the direct marketing industry, or fail to realize all of the applicable laws and regulations. Failure to comply with or to obtain the necessary licenses, permits, or authorizations, could result in restrictions on our ability to operate our direct marketing business, which could have a material adverse effect on our business.

 

Interruptions with the delivery of our third-party cloud-based systems, such as AWS’ or Alibaba’s, that we use in our operations, may adversely affect our business, operating results, and financial condition.

 

Our reputation and ability to attract, retain, and serve users depends on the reliable performance of the Yippi App. The Yippi App runs on a complex distributed system, or what is commonly known as cloud computing. We rely on the cloud services operated by Alibaba, an entity that we do not control and which would require significant time to replace. Alibaba may experience service disruptions, outages, and other performance problems, which could adversely affect our business. Further, Alibaba’s systems and operations, which are currently located in Hong Kong, and AWS’ systems and operations, which are currently located in South Korea, are vulnerable to damage or interruption from fires, floods, power losses, telecommunications failures, cyber-attacks, terrorist attacks, acts of war, human errors, break-ins and similar events beyond our control, which could negatively affect the Yippi App and our ability to provide services to our users.

 

Further, as the number of our users increases, and as our users generate and transmit increasing volumes of content, including photos, videos, and music, we have to rely on Alibaba to provide us with their cloud infrastructure to continue to reliably store and service such content. It is possible that Alibaba will be unable to accommodate these increased demands, which would harm our business and reputation. Further, any disruption or failure in the services we receive from Alibaba could harm our ability to handle existing or increased traffic and could seriously harm our business. We expect this dependence on third parties to continue for the foreseeable future.

 

 
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If Alibaba or other service providers are unable to sufficiently meet our needs, our business, financial condition, and results of operations may be harmed.

 

If we fail to retain current users or add new users, or if our users decrease their level of engagement with our Yippi App, our business would be seriously harmed.

 

The success of our Yippi App heavily depends on the size of our user base and the level of engagement of our users. Thus, our business performance will also become increasingly dependent on our ability to increase levels of user engagement in existing and new markets. As of December 31, 2020, we had 214,462 monthly active users (MAU) and 120,412 daily active users (DAU). Taking into consideration that the majority of our users range between 18 and 34 years old, this particular demographic is faster pace and less likely to be brand loyal. In addition, we are continuously subject to a highly competitive market in order to attract and retain our users’ attention. A number of factors could negatively affect user retention, growth, and engagement, including if:

 

 

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users increasingly engage with competing products instead of ours, particularly communication tools and other mobile applications with multiple features;

 

 

 

 

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we fail to introduce new and exciting products and services, or such products and services do not achieve a high level of market acceptance;

 

 

 

 

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we fail to accurately anticipate consumer needs, or we fail to innovate and develop new software and products that meet these needs;

 

 

 

 

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we fail to price our products competitively;

 

 

 

 

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we do not provide a compelling user experience because of the decisions we make regarding the type and frequency of advertisements that we display;

 

 

 

 

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we are unable to combat spam, bugs, malwares, viruses, hacking, or other hostile or inappropriate usage on our products;

 

 

 

 

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there are changes in user sentiment about the quality or usefulness of our existing products in the short-term, long-term, or both;

 

 

 

 

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there are increased user concerns related to privacy and information sharing, safety, or security;

 

 

 

 

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there are adverse changes in our products or services that are mandated by legislation, regulatory authorities, or legal proceedings;

 

 

 

 

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technical or other problems frustrate the user experience, particularly if those problems prevent us from delivering our products in a fast and reliable manner;

 

 

 

 

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we, our partners, or other companies in our industry are the subject of adverse media reports or other negative publicity, some of which may be inaccurate or include confidential information that we are unable to correct or retract; or

 

 

 

 

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we fail to maintain our brand image or our reputation is damaged.

 

Any decrease in user retention, growth, or engagement could render our products less attractive to users, advertisers, or partners, thereby reducing our revenues from them, which may have a material and adverse impact on our business, financial condition, and results of operations. In addition, there can be no assurance that we will succeed in developing products and services that eventually become widely accepted, that we will be able to timely release products and services that are commercially viable, or that we will establish ourselves as a successful player in a new business area. Our inability to do so would have an adverse impact on our business, financial condition, and results of operations.

 

 
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We have a limited operating history in the competitive and rapidly emerging market for our social media products and services, which make it difficult for us to assess our prospects and future financial results, which could increase the risk that we will not be successful.

 

We launched our Yippi messaging application in July 2017, and our other Yippi related products and services more recently. Our short operating history in the market makes it difficult to effectively assess our prospects and forecast our future financial results. Our growth depends on our Yippi App achieving significant popularity. Our Yippi App, and any mobile application we may develop in the future, requires significant engineering, marketing, and other resources to develop, launch, and sustain via regular upgrades. Our ability to successfully launch new mobile applications, sustain and expand the Yippi App, and expand and retain a user-base, largely will depend on our ability to:

 

 

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effectively respond to changing mobile application interests and preferences by enhancing Yippi globally;

 

 

 

 

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increase our number of users and user engagement and monetize our products and services;

 

 

 

 

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successfully compete with other companies, some of which have substantially greater resources and market share than us, that are currently in, or may in the future enter, our markets, or duplicate the features of our products and services;

 

 

 

 

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develop and deploy new features, products and services in a timely manner and the market acceptance of such offerings;

 

 

 

 

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cost-effectively manage and grow our operations;

 

 

 

 

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process, store, protect, and use personal data in compliance with governmental regulations, contractual obligations, and other obligations related to privacy and security; and

 

 

 

 

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defend ourselves against litigation and regulatory, intellectual property, privacy, or other claims.

 

Mobile malware, viruses, hacking attacks, and improper or illegal use of the Yippi App could harm our business and results of operations.

 

Mobile malware, viruses, and hacking attacks have become more prevalent in our industry, and may occur on our systems in the future. Any security breach caused by hacking, which involves efforts to gain unauthorized access to information or systems, or to cause intentional malfunctions or loss or corruption of data, software, hardware or other computer equipment, and the inadvertent transmission of computer viruses could harm our business, financial condition, and operating results. Any failure to detect such attack and maintain performance, reliability, security, and availability of products and technical infrastructure to the satisfaction of our users may also seriously harm our reputation and our ability to retain existing users and attract new users.

 

Our information technology systems are susceptible to a growing and evolving threat of cybersecurity risk. Any substantial compromise of our data security, whether externally or internally, or misuse of agent, customer, or employee data, could cause considerable damage to our reputation, cause the public disclosure of confidential information, and result in lost sales, significant costs, and litigation, which would negatively affect our financial position and results of operations. Although we maintain policies and processes surrounding the protection of sensitive data, which we believe to be adequate, there can be no assurances that we will not be subject to such claims in the future.

 

 
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If our security is compromised or if our products and services are subject to attacks that frustrates or thwarts our user’s ability to access the Yippi App, our products and services may be perceived as insecure and users may curtail or stop using our products and services.

 

Our products and services involve the storage and transmission of large amounts of users’ confidential information, such as a user’s name, address, phone number, date of birth, passport information, credit card information, and bank account information. Security breaches expose us to a risk of unauthorized access to this information and could lead to improper use or disclosure of such information, ensuing potential liability and litigation, any of which could damage our reputation and our brand and diminish our competitive position. We believe that we take reasonable steps to protect the security, integrity and confidentiality of the information we collect, use, store, and disclose, but there is no guarantee that inadvertent (e.g., software bugs or other technical malfunctions, employee error or malfeasance, or other factors) or unauthorized data access or use will not occur despite our efforts. Although we have not experienced any material security breaches to date, we may in the future experience attempts to breach the security of our systems. Techniques used to obtain unauthorized access to personal information, confidential information on the systems, and/or to sabotage systems change frequently and generally are not recognized until launched against a target. As a result, we may be unable to anticipate these techniques or to implement adequate preventative measures.

 

Maintaining the trust of our users is important to sustain our growth, retention, and user’s engagement. If an actual or perceived security breach occurs, the market perception of our security measures could be harmed and we could lose users and/or suffer other negative consequences to our business. Any failure to maintain the security of our infrastructure could result in loss of personal information and/or other confidential information, damage to our reputation and user relationships, early termination of our contracts and other business losses, indemnification of our users, financial penalties, litigation, regulatory investigations, and other significant liabilities. In the event of a major third-party security incident, we may incur losses in excess of their insurance coverage. Further, we do not have insurance currently, and certain incidents that we can experience may not be covered by any insurance that we may carry in the future.

 

There are low barriers to entry in the mobile application industry, and competition is intense.

 

The mobile application industry is highly competitive as we face significant domestic and international competitors that are more established, have greater financial resources and a larger user base. In addition to these major players, there are also smaller companies that may enter the sector and compete with the Yippi App.

 

Furthermore, we have limited experience in developing applications for mobile and other platforms and our ability to succeed on those platforms is uncertain. As we continue to devote resources to our Yippi App, we will face intense competition from both established companies and new-comers. Some of these current, emerging, and potential competitors have significant resources for developing applications, and have a more diversified set of revenue sources than we do and may be less severely affected by changes in consumer preferences, regulations, or other developments that may impact the market for mobile apps. As we introduce new products and our existing products evolve, or as other companies introduce new products and services, we may become subject to additional competition. Increased competition could result in loss of existing users or reduce our ability to acquire new users, both of which could harm our business. If we are unable to compete against our competitors in such intense circumstances, our user engagement may decrease, which could make us less attractive to users, advertisers, and will seriously harm our business.

 

The global wellness industry is highly competitive and such competition could harm our business.

 

The global wellness industry is fragmented and highly competitive. We compete for independent sales agents with other direct marketing companies both within and outside the wellness industry. Many of our competitors have greater name recognition and financial resources, which may give them a competitive advantage. Our competitors may also be able to devote greater resources to marketing, promotional, and pricing campaigns that may influence our continuing and potential independent agents and our preferred customers to buy products from our competitors rather than from us. Such competition could adversely affect our business and current market share.

 

 
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If we are unable to attract and retain independent agents for our direct marketing business, our business may suffer.

 

Our future success depends upon our ability to attract and retain a large active base of independent agents and customers for our direct marketing business. We rely on our non-employee independent agents to market and sell our products to customers to generate growth and to attract new independent agents who are interested in building a business. Our ability to increase sales depends on our ability to increase the number of customers in each of our markets around the world. Our success will also depend on our ability to retain and motivate our existing independent agents and attract new independent agents. We cannot give any assurances that the number of our independent agents will continue at their current levels or increase in the future. Several factors affect our ability to attract and retain independent agents and preferred customers, including:

 

 

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on-going motivation of our independent agents;

 

 

 

 

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general economic conditions;

 

 

 

 

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significant changes in the amount of commissions paid;

 

 

 

 

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public perception and acceptance of the wellness industry;

 

 

 

 

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public perception and acceptance of direct marketing business;

 

 

 

 

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public perception and acceptance of our business and our products, including any negative publicity;

 

 

 

 

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the limited number of people interested in pursuing direct marketing as a business;

 

 

 

 

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our ability to provide proprietary quality-driven products that the market demands; and

 

 

 

 

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competition in recruiting and retaining independent agents.

 

The loss of key high-level leaders of our independent agents could negatively impact our agent growth and our revenue.

  

As of July 31, 2020, we had approximately 112,429 active independent agents. As of July 31, 2019 we had approximately 8,838 active independent agents working with PT Toga.  These high-level independent agents are important in maintaining and growing our revenue. As a result, the loss of a high-level independent agent or a group of leading agents in the independent agent’s networks of downlines, whether by their own choice or through disciplinary actions by us for violations of our policies and procedures, could negatively impact our growth and our revenue with respect to our independent agents.

   

The loss of key management personnel could adversely affect our business.

 

We depend on the continued services of our executive officers and senior management team as they work closely with both our employees and independent agents. Such executive officers and senior management team are also responsible for our day-to-day operations. Our success depends in part on our ability to retain our executive officers, to compensate our executive officers at attractive levels, and to continue to attract additional qualified individuals to our management team. We do not believe that any of our senior executive officers are planning to leave or retire in the near term; however, we cannot assure that our senior executive officers or members of our senior management team will remain with us. The loss or limitation of the services of any of our executive officers or members of our senior management team, including our regional and country managers, or the inability to attract additional qualified management personnel, could have a material adverse effect on our business, financial condition, results of operations, or independent agent relations.

 

To date, we have not obtained directors’ and officers’ liability (“D&O”) insurance. Without adequate D&O insurance, the amounts we would pay to indemnify its officers and directors should they be subject to legal action based on their service to us could have a material adverse effect on our financial condition, results of operations, and liquidity. Furthermore, our lack of adequate D&O insurance may make it difficult for us to retain and attract talented and skilled directors and officers, which could adversely affect our business.

 

 
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If we are unable to protect our intellectual property rights, our business could suffer.

 

Our primary intellectual property rights are our trademarks, primarily “Yippi” and “Eostre.” In addition, we have entered into collaboration agreements and confidentiality agreements with certain of our software programmers, employees, suppliers, manufacturers, directors, officers, consultants, and other third-parties to help protect our proprietary rights. However, these only afford limited protection, and unauthorized parties may attempt to copy aspects of our mobile application features and functionality, or to use information that we consider proprietary or confidential. Further, with respect to mobile applications, the features and functionality can be easily republicated; thus, it may be difficult to protect. With respect to our Eostre products, we use white-labeled products that are then branded with our trademarked name “Esotre.” Other companies can, and currently do, use the same white-labeled products and market these products under their own name.

 

We consult with outside legal counsel to help ensure that we protect our proprietary rights, to the extent possible and feasible. However, our business, profitability, and growth prospects could be adversely affected if we fail to receive adequate protection of our proprietary rights.

 

We could be required to cease certain activities and/or incur substantial costs as a result of any claim of infringement of another party’s intellectual property rights.

 

Some of our competitors may own technology patents, copyrights, trademarks, trade secrets, and website content, which they may use to assert claims against us. As we face increasing competition and as litigation becomes a more common way to resolve disputes, we face a higher risk of being the subject of intellectual property infringement claims. We cannot assure you that we will not become subject to claims that we have misappropriated or misused other parties’ intellectual property rights. Any claim or litigation alleging that we have infringed or otherwise violated intellectual property or other rights of third parties, with or without merit, and whether or not settled out of court or determined in our favor, could be time-consuming and costly to address and resolve, and could divert the time and attention of our management and technical personnel.

 

The results of any intellectual property litigation to which we might become a party may require us to do one or more of the following:

 

 

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cease making, selling, offering, or using technologies or products that incorporate the challenged intellectual property;

 

 

 

 

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make substantial payments for legal fees, settlement payments, or other costs or damages;

 

 

 

 

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obtain a license, which may not be available on reasonable terms, to sell or use the relevant technology; or

 

 

 

 

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redesign technology to avoid infringement.

 

If we are required to make substantial payments or undertake any of the other actions noted above as a result of any intellectual property infringement claims against us, such payments or costs could have a material adverse effect upon our business and financial results.

 

 
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Our businesses are subject to a variety of laws and regulations in the United States and other foreign laws, many of which are subject to change and uncertain interpretation and could result in claims, changes to our business practices, or otherwise harm our business.

 

We are subject to a variety of laws and regulations in the United States and other countries that involves matters central to our business, including but not limited to the FCPA, laws regarding consumer protection, intellectual property, export, and national security. Many of these laws and regulations are still evolving and could be interpreted or applied in ways that could limit our business or require us to make certain fundamental and potentially detrimental changes to the products and services we offer. For example, laws relating to the liability of providers of online services for activities of their users and other third-parties are currently being tested by a number of claims, including actions based on invasion of privacy and other torts, unfair competition, copyright, and trademark infringement, and other theories based on the nature and content of the materials searched, the ads posted, or the content provided by users. Furthermore, the introduction of new products or services in our existing markets and the expansion of our business to other countries may subject us to additional laws and regulations, among others resulting from the need to obtain additional licenses and approvals to conduct our businesses as envisioned.

 

Our Eostre products are not currently offered in the United States. Should we choose to do so, we will have to comply with all rules and regulations of the FDA. The processes by which regulatory approvals are obtained from the FDA and foreign regulatory authorities to market and sell a new product are complex, require a number of years, depend upon the type, complexity, and novelty of the product candidate, and involve the expenditure of substantial resources for research, development, and testing. In addition, if we were to market our products in additional foreign jurisdictions, we may be required to obtain separate regulatory approvals in each country. The approval procedure varies among countries and can involve additional testing, and the time required to obtain approval may differ from that required to obtain FDA approval.

 

If we are not able to comply with these laws or regulations or if we become liable under these laws or regulations, we could be directly harmed, and we may be forced to implement new measures to reduce our exposure to this liability. This may require us to expend substantial resources or to modify our Yippi App or our Eostre products, which would harm our business, financial condition, and results of operations. In addition, the increased attention focused upon liability issues as a result of lawsuits and legislative proposals could harm our reputation or otherwise impact the growth of our business. Any costs incurred as a result of this potential liability could harm our business and operating results.

 

We may experience fluctuations in our quarterly operating results due to a number of factors, which make our future results difficult to predict.

 

Our revenue and other operating results could vary significantly from quarter-to-quarter due to a variety of factors, many of which are outside our control. In addition, we have a limited operating history with the current scale of our business, which makes it difficult to predict our future revenue or results of operations. Our financial condition and results of operations can be influenced by numerous factors, which may include the following:

 

 

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our ability to maintain and grow our user base and user engagement;

 

 

 

 

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the development of new products and services by us;

 

 

 

 

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our ability to attract and retain advertisers in a particular period;

 

 

 

 

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the diversification and growth of revenue sources beyond current advertising; and

 

 

 

 

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increases in marketing, sales, and other operating expenses that we may incur to grow and expand our operations and to remain competitive.

 

We base our current and future expense levels on our internal operating plans and forecasts, and some of our operating costs are to a large extent fixed in the near term. As a result, we may not be able to reduce our costs quickly enough to compensate for an unexpected shortfall in revenue and, even a small shortfall in revenue, could adversely affect financial results for that quarter.

 

 
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Because substantially all of our executive officers, directors, and assets are located outside the United States, primarily in Malaysia, investors may experience difficulties in attempting to effect service of process and to enforce judgments based upon U.S. federal securities laws against us and our officers and directors.

 

While we are organized under the laws of State of Nevada, almost all of our executive officers and our directors are non-U.S. residents and our operations and assets are located outside the United States (primarily in Malaysia). Consequently, it may be difficult for investors to effect service of process on our officers and our directors in the United States and to enforce in the United States judgments obtained in United States courts against any of them based on the civil liability provisions of the United States securities laws, enforce United States judgments in a Malaysian court based on the civil liability provisions of the United States securities laws, or bring an original action against them in a Malaysian court to enforce liabilities based upon the United States federal securities laws. Since all our assets will be located outside the United States, it may be difficult or impossible for investors located in the United States to collect a judgment against us.

 

Our user metrics with respect to the Yippi App may be subject to inherent uncertainties in measurement, and real or perceived inaccuracies in such metrics may severely harm our reputation and negatively affect our business.

 

We use our internal company data to calculate our Yippi App monthly active users and daily active users for the evaluation of growth trends, performance, and to make strategic decisions, but these metrics have not been verified by an independent third party. While these numbers are based on what we reasonably believe to be the estimates of our active users for the applicable period of measurement, there are inherent challenges in measuring how our products and services are used across large online and mobile populations globally. For example, there might be several accounts created by the same individual utilizing different usernames, which may cause inaccuracy in the data collected. Some of our demographic data may be incomplete or inaccurate due to the incorrect or inadequate information given by the users when registering for Yippi account. These errors or inaccuracies in our metrics or data could result in incorrect business decisions and inefficiencies.

 

We regularly review and seek to address these technical issues by adjusting our processes for calculating our internal metrics to improve their accuracy. Our measures of user growth and user engagement may differ from estimates published by third parties or from similarly-titled metrics of our competitors due to differences in methodology. If advertisers, platform partners, or prospective investors do not perceive our user, geographic, or other demographic metrics to be accurate representations of our user base or user engagement, or if we discover material inaccuracies in our user metrics, our reputation may be harmed and platform partners and advertisers may be less willing to allocate their budgets or resources to our products and services, which may negatively affect our business.

 

We generate some revenue from advertising. The failure to attract new advertisers, the loss of advertisers, or a reduction in spending by our advertisers could harm our business.

 

We derive some revenues from advertising on our Yippi App. Although we have and continue to try to establish longer-term advertising commitments with advertisers, most of our advertisers do not have long-term advertising commitments with us. In addition, advertisers may view some of our products as experimental and unproven; thus, our efforts to establish long-term commitments may not succeed.

  

 
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We rely heavily on our ability to collect and disclose data and metrics in order to attract new advertisers and retain existing advertisers. Any restriction, whether by law, regulation, policy, or other reason, on our ability to collect and disclose data that our advertisers find useful would impede our ability to attract and retain advertisers. Our advertising revenue could be seriously harmed by many other factors, including:

 

 

·

a decrease in the number of active users on Yippi App;

 

 

 

 

·

our inability to create new products that sustain or increase the value of our advertisements;

 

 

 

 

·

our inability to increase the relevance of targeted advertisements shown to users;

 

 

 

 

·

adverse legal developments relating to advertising, including changes mandated by legislation, regulation, or litigation;

 

 

 

 

·

our inability to increase advertisers’ demand and inventory; and

 

 

 

 

·

difficulty and frustration from advertisers who may need to reformat or change their advertisements to comply with our guidelines.

 

The occurrence of any of these or other factors could result in a reduction in demand for advertisements, which may reduce the prices we receive for our advertisements or cause advertisers to stop advertising with us altogether, either of which would negatively affect our business, financial condition and results of operations.

 

The requirements of being a public company may strain our resources, result in more litigation, and divert management’s attention.

 

We are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall Street Reform and Consumer Protection Act and other applicable securities rules and regulations. Complying with these rules and regulations have caused us and will continue to cause us to incur additional legal and financial compliance costs, make some activities more difficult, be time-consuming or costly, and continue to increase demand on our systems and resources. The Exchange Act requires, among other things, that we file annual, quarterly, and current reports with respect to our business and operating results. Further, by complying with public disclosure requirements, our business and financial condition are more visible, which we believe may result in increased threatened or actual litigation, including by competitors and other third parties. Compliance with these additional requirements may also divert management’s attention from operating our business. Any of these may adversely affect our operating results.

 

Foreign government initiatives to restrict access to the Yippi App could seriously harm our business.

 

Foreign data protection, privacy, consumer protection, content regulation, and other laws and regulations are often more restrictive than those in the United States. Foreign governments may censor Yippi in their countries, restrict access to Yippi from their countries entirely, impose laws on us that require data localization, or impose other restrictions that may affect their citizens’ ability to access Yippi for an extended period of time or even indefinitely. If foreign governments think we are violating their laws, or for other reasons, they may seek to restrict access to Yippi, which would give our competitors an opportunity to penetrate geographic markets that we cannot access. As a result, our user growth, retention, and engagement may be seriously harmed, and we may not be able to maintain or grow our revenue as anticipated and our business could be seriously harmed. For example, access to Google, which currently powers most of our infrastructure, is restricted in China, and we do not know if we will be able to enter the market in a manner acceptable to the Chinese government.

 

 
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If government regulations regarding our direct marketing business change or are interpreted or enforced in a manner adverse to our business, we may be subject to new enforcement actions and material limitations regarding our overall business model.

 

Direct marketing business models are always subject to extensive governmental regulations, including foreign, federal, and state regulations. The FTC has issued certain guidance focusing on regulation of multi-level marketing related businesses. Although we currently do not operate a multi-level marketing program in the United States, we may be subject to similar regulation in the countries in which we do business. Any change in legislation and regulations could affect our business. Furthermore, significant penalties could be imposed on us for failure to comply with various statutes or regulations. Violations may result from:

 

 

·

ambiguity in statutes;

 

 

 

 

·

regulations and related court decisions;

 

 

 

 

·

the discretion afforded to regulatory authorities and courts interpreting and enforcing laws;

 

 

 

 

·

new regulations affecting our business; and

 

 

 

 

·

changes to, or interpretations of, existing regulations affecting our business.

 

While we prioritize ensuring that our business and compensation model are compliant, and that any product or income related claims are truthful and non-deceptive, we cannot be certain that the FTC or similar regulatory body in another country will not modify or otherwise amend its guidance, laws, or regulations or interpret in a way that would render our current practices inconsistent with the same.

 

Our success partially depends on our ability to hire and retain mobile application developers. If we are unable to do so, or if the developing process stops or is delayed for any reason, we may not deliver our products within the Yippi App to our customers on time, which may seriously harm our business.

 

We have limited experience developing our products within the Yippi App. Our ability to hire and retain experienced developers to build such products is crucial. Experienced developers could, at times, be in short supply, we may be unable to hire sufficient number of developers, or the market compensation payable to such experienced developers could be significant. Delays and other developer problems could impair the release of our in-app products and, ultimately, our brand. This may lead to unsatisfied customers and users and increase costs to us, which could seriously harm our business.

 

We may face lawsuits or incur liabilities in the future in connection with our businesses.

 

In the future, we may face lawsuits or incur liabilities in connection with our businesses. For example, we could face claims relating to information that is published or made available on the Yippi App. In particular, the nature of our business exposes us to claims related to defamation, intellectual property rights, rights of publicity and privacy, and personal injury torts. We might not be able to monitor or edit the vast majority of the content that appears on the Yippi App. This risk is enhanced in certain jurisdictions outside the United States where our protection from liability for third-party actions may be unclear and where we may be less protected under local laws than we are in the United States.

 

We could also be subject to lawsuits or liabilities based on actions of our independent sales agents. Our independent sales agents could engage in misconduct, violate our policies and procedures, or engage in other conduct that leads to litigation, complains, enforcement actions, and inquiries by various foreign regulatory authorities.

 

 
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Finally, even though it is unlikely given the countries we do business in, we could face financial liability from product liability claims if the use of our Eostre products results in significant loss or injury. We can make no assurances that we will not be exposed to any substantial future product liability claims. Such claims may include claims that our products contain contaminants, that we provide our independent agents and consumers with inadequate instructions regarding product use, or that we provide inadequate warnings concerning side effects of our products. Product liability insurance is uncommon in the jurisdictions that we do business in; therefore, a substantial future product liability claim could adversely affect our overall future financial condition.

 

Any such claims would result in us incurring significant costs investigating and defending such claims and, if we are found liable, significant damages. We could also face fines or orders restricting or blocking our services in particular geographies as a result of content hosted on our services. If any of these events occur, our business could be seriously harmed.

 

Our international operations are subject to political economic and social uncertainties, which may cause our business to suffer.

 

We currently sell our Eostre products in Malaysia to independent agents located throughout Asia and Southeast Asia. Our Yippi App is currently available around the world (however, the TRT feature within the Yippi App is not available to users in the United States). Our international operations could experience changes in legal and regulatory requirements, as well as difficulties in adapting to new foreign cultures and business customs. If we do not adequately address such issues, our international markets may not meet growth expectations. Our international operations and future expansion plans are subject to political, economic, and social uncertainties, including:

 

 

·

inflation;

 

 

 

 

·

the renegotiation or modification of various agreements;

 

 

 

 

·

increases in custom duties and tariffs;

 

 

 

 

·

changes and limits in export controls;

 

 

 

 

·

complex U.S. and foreign laws, treaties and regulations, including without limitation, tax laws, the FCPA, and similar anti-bribery and corruption acts and regulations in many of the markets in which we operate;

 

 

 

 

·

trademark availability and registration issues;

 

 

 

 

·

changes in exchange rates;

 

 

 

 

·

changes in taxation;

 

 

 

 

·

wars, civil unrest, acts of terrorism and other hostilities;

 

 

 

 

·

political, economic, and social conditions;

 

 

 

 

·

the effects of COVID-19;

 

 

 

 

·

changes to trade practice laws or regulations governing direct selling and marketing;

 

 

 

 

·

increased government scrutiny surrounding direct selling and marketing;

 

 

 

 

·

changes in the perception of direct marketing; and

 

 
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The risks outlined above could adversely affect our ability to sell advertising, products, obtain international customers, or to operate our international business profitably, which would have a negative impact on our overall business and results of operations. Furthermore, any negative changes in our distribution channels may force us to invest significant time and money related to our distribution and sales to maintain our position in certain international markets.

   

Currency exchange rate fluctuations could reduce our overall profits.

 

For the years ended July 31, 2019 and July 31, 2018, we recognized 96% and 100%, respectively, of net sales in markets outside of the United States. In preparing our consolidated financial statements, we are required to translate certain financial information from foreign currencies to the United States dollar using either the spot rate or the weighted-average exchange rate. If the United States dollar changes relative to applicable local currencies, there is a risk our reported sales, operating expenses, and net income could significantly fluctuate. For example, in fiscal 2019, we had a foreign exchange gain of $123,234 and in fiscal 2018, we had a foreign exchange loss of $53,996. There can be no assurance that foreign currency fluctuations will not have a material adverse effect on our business, assets, financial condition, liquidity, results of operations, or cash flows. We are not able to predict the degree of exchange rate fluctuations, nor can we estimate the effect any future fluctuations may have upon our future operations. To date, we have not entered into any hedging contracts or participated in any hedging or derivative activities.

 

Our financial condition, results of operations, cash flows, and performance may be adversely impacted or disrupted by public health epidemics, including the COVID-19 global health pandemic.

 

An outbreak of respiratory illness caused by COVID-19 emerged in late 2019 and has spread globally, including Malaysia, our Company’s principal place of operations. In March 2020, the World Health Organization declared the outbreak of COVID-19 as a pandemic based on the rapid increase in global exposure. COVID-19 continues to spread throughout the world.

 

On March 19, 2020, a Movement Control Order (the “MCO”) was issued by the Malaysian Prime Minister, which reduced movement within Malaysia, closed all offices within the country that were non-essential, cancelled all non-essential travel and limited travel from outsiders deemed as non-essential. Eventually, the MCO was lifted as of June 9, 2020, and certain safe-distance and other controlling protocols (the Recovery Movement Control Order or “RMCO”) were put into place, which are now in effect until December 31, 2020. As of January 26, the RMCO has been extended to March 31, 2021.

 

Our offices in Malaysia closed as a result of the MCO, and our office-based employees located both in Malaysia and in the United States have been working remotely since the middle of March. Travel remains restricted to limit the risk of our employees coming in contact with COVID-19. In addition, as a result of COVID-19, we have terminated all agreements with Agel, formerly one of our largest customers. (See “Related Party Transactions” for additional information.) COVID-19 also resulted in a significant decrease in revenue being generated by TogaGo during fiscal 2020, the suspension of operations of our Taiwan branch office, and our customer service suffering.

 

 
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If the pandemic continues and conditions worsen, it could further negatively impact our business, results of operations, financial condition and liquidity in numerous ways, including, but not limited, to:

 

 

·

We may have interruptions in our business due to illness among our employees. Through January 31, 2021, we have not had any of our employees contract COVID-19. Should we have a significant number of our employees contract COVID-19, it could have a further negative impact on our ability to serve customers in a timely fashion.

 

 

 

 

·

Our revenue has declined with respect to certain of our lines of business. We have been impacted by the MCO in regards to TogaGo revenue. With the MCO, travel was restricted and customers were not using the Yippi App for travel and hotel bookings. This resulted in a significant decrease in TogaGo revenue in the year ended July 31, 2020.

 

 

 

 

·

Further, while we have not yet experienced any interruption to our normal materials and supplies process, it is impossible to predict whether COVID-19 will cause future interruptions and delays. We currently rely on our manufacturer, which is located in South Korea to manufacture our “Eostre” products. To date, the manufacturing of our Eostre products have not been adversely affected by COVID-19. However, the COVID-19 pandemic, and the governmental or regulatory actions taken in response to the pandemic, may interfere with our ability to have our products manufactured in a timely manner, or at all, in the future. As noted above, as a result of COVID-19, Agel terminated business operations and we are in the process of acquiring Eostre Bhd. This has resulted in a significant change to our Eostre business model as we have begun to sell directly to independent sales agents in Malaysia and Japan through our partially owned subsidiary, Eostre Bhd.

 

These and other impacts of the COVID-19 pandemic, or other pandemics or epidemics, could have the effect of heightening many of the other risks described in this Amended Annual Report under the “Risk Factors” section. We might not be able to predict or respond to all impacts on a timely basis to prevent near- or long-term adverse impacts to our results. The severity, magnitude and duration of the COVID-19 pandemic is uncertain, rapidly changing, and hard to predict. We do not yet know the full extent of potential delays or impacts on our business, our results of operations, or financial condition or the global economy as a whole. However, these effects could have an adverse impact on our liquidity, capital resources, operations and business and those of the third parties on which we rely, and such impact could be material.

 

The restatement of certain of our historical consolidated financial statements may have an adverse effect on us.

 

We have restated certain items on our consolidated financial statements for prior periods and are continuing to do so. On November 19, 2020, the Audit Committee of the Board of Directors of Toga Limited (the “Company”) concluded, after discussion with the Company’s management, that the Company’s consolidated financial statements for the (i) year ended July 31, 2019, (ii) interim period ended April 30, 2019, (iii) interim period ended October 31, 2019, (iv) interim period ended January 31, 2020, and (v) interim period April 30, 2020 (collectively, the “Non-Reliance Periods”) should no longer be relied upon due to errors in the consolidated financial statements and should be restated. Similarly, press releases, earnings releases, and investor presentations or other communications describing the Company’s consolidated financial statements and other related financial information covering the Non-Reliance Periods should no longer be relied upon. In addition, the audit report of Pinnacle Accountancy Group of Utah (“Pinnacle”) included in the Company’s Annual Report on the Original Form 10-K, for the year ended July 31, 2019, should no longer be relied upon.

 

 
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In connection with the preparation of the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, 2020 (the “2020 Form 10-K”), the Company’s management became aware that the Company’s consolidated financial statements for the Non-Reliance Periods contained errors related to revenue recognition for one or more of the Company’s subsidiaries engaged in the Company’s direct sales business. In such instances, the Company improperly recognized the cash proceeds from sales of membership packages to its independent agents as revenues, rather than as deferred revenue. In accordance with Accounting Standards Codification 606, Revenues from Contracts with Customers, the proceeds should have been recognized as revenue upon the satisfaction of the subsidiary’s performance obligations, which would have been the time of shipment of inventory to such independent agents. This resulted in an overstatement of revenue and an understatement of deferred revenue.

 

The Company is working to complete the restatement of its financial statements for the Non-Reliance Periods. The Company has determined to file amendments to (i) each of the Quarterly Reports on Form 10-Q for the interim periods covered by the Non-Reliance Periods and (ii) the 2019 Form 10-K. Accordingly, investors and others should rely only on the financial information and other disclosures regarding the Non-Reliance Periods once the Company restates its consolidated financial statements and not rely on any previously issued or filed registration statements or reports, earning press releases, investor presentations or other communications related thereto covering the Non-Reliance Periods.

 

Management is assessing the effect of the restatements on the Company’s internal control over financial reporting and its disclosure controls and procedures. The Company expects to report one or more material weaknesses following completion of its investigation of the cause of these restatements. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. The existence of one or more material weaknesses precludes a conclusion by management that a company’s disclosure controls and procedures and internal control over financial reporting are effective. In addition, the Audit Committee, the Board of Directors, and management have begun evaluating appropriate remediation actions. For example, commencing in January 2021, management intends to implement a new Enterprise Resource Planning (ERP) system with more oversight and control of the Company’s subsidiaries’ financial reporting processes by key members of management.

 

Based on the restatements described above, our management concluded that our system of internal control over financial reporting was not effective during the Non-Reliance Periods, which resulted in the restatements described above. Management had identified internal control deficiencies which, in management’s judgment, represented material weakness in internal control over financial reporting. Specifically, management identified that due to the limited resources of the company and adequate staffing within the accounting department, segregation of duties had been identified as a weakness in internal control, as was the US GAAP qualifications of the accounting staff. In January 2020 we engaged an external consulting firm to assist with the design and implementation of our internal process, including those internal controls over financial reporting. Due to the COVID-19 pandemic, the lockdowns instituted by local governments and travel restrictions in each of the countries for our subsidiaries, including but not limited to, our international operation headquarters in Kuala Lumpur, Malaysia and our corporate offices in Los Angeles California, we have not been able to implement these internal controls as of January 28 2021.

 

 
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Based on the discovery of the errors relating to the restatements described above, our management concluded that our internal control over financial reporting was not effective during the Non-Reliance Periods. Management had identified internal control deficiencies which, in management’s judgment, represented material weakness in internal control over financial reporting. The control deficiencies generally related to the limited resources of the company and adequate staffing within the accounting department, segregation of duties had been identified as a weakness in internal control, as was the US GAAP qualifications of the accounting staff. In January 2020 we engaged an external consulting firm to assist with the design and implementation of our internal process, including those internal controls over financial reporting. Due to the COVID-19 pandemic, the lockdowns instituted by local governments and travel restrictions in each of the countries for our subsidiaries, including but not limited to, our international operation headquarters in Kuala Lumpur, Malaysia and our corporate offices in Los Angeles California, we have not been able to implement these internal controls as of January 28, 2021.

 

As a result of the events described above, we may become subject to a number of significant risks, which could have an adverse effect on our business, financial condition and results of operations, including: we may be subject to potential civil litigation, including shareholder class action lawsuits and derivative claims made on behalf of us, and regulatory proceedings or actions, the defense of which may require us to devote significant management attention and to incur significant legal expense and which litigation, proceedings or actions, if decided against us, could require us to pay substantial judgments, settlements or other penalties.

 

Item 2. Properties.

 

Our properties consist primarily of leased office and commercial office space we own in Selangor, Malaysia. Our corporate headquarters are located in Los Angeles, California and our other office facilities in Selangor and Kuala Lumpur, Malaysia, Jakarta, Indonesia; Ho Chi Minh City, Vietnam; and Mesa, Arizona. The following schedule presents the approximate square footage of our facilities as of January 31, 2021 (some of which are no longer in use as of the date of this Amended Annual Report):

   

 
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Location

 

Square Feet or Other

 

Commitment and Use

Los Angeles, California

 

200

 

Leased; corporate headquarters

Irvine, California

 

29,850

 

Leased office space (terminated in August 2020)

Las Vegas, Nevada

 

Virtual Office

 

Leased; virtual office space (terminated in July 2020)

Kuala Lumpur, Malaysia

 

1,433

 

Leased office space

Kuala Lumpur, Malaysia

 

9 persons

 

Leased office space

Taichung City, Taiwan

 

5,195

 

Leased office space (terminated in July 2020)

Jakarta, Indonesia

 

3,767

 

Leased office space

Jakarta, Indonesia

 

2,352

 

Leased office space

Selangor, Malaysia

 

41,688

 

Owned; principal business operations

Ho Chi Minh City, Vietnam

 

Virtual Office

 

Leased; virtual office space

Mesa, Arizona

 

1 person

 

Leased

 

We consider our properties adequate for our current needs. With respect to our leased properties, we do not anticipate any difficulties in negotiating renewals as leases expire or in finding other satisfactory space, if current premises become unavailable.

 

On August 20, 2020, we entered into a two-year lease for approximately 200 square feet of office space located at 515 South Flower Street, Los Angeles, California 90071. The monthly lease payment is $1,682. The lease ends on August 31, 2022. Prior to this, we maintained our corporate headquarters in Irvine, California.

 

On August 28, 2019, we entered into a lease for approximately 7,850 square feet of office space located at 2575 McCabe Way, Irvine, California, 92614. The monthly lease payment was approximately $9,383. The lease ended on August 31, 2020. We did not renew.

 

On July 18, 2018, we entered into a one-year lease for virtual office space located at Center 1057, 3960 Howard Hughes Parkway, Las Vegas, Nevada, 89169. The lease is for $269 per month, and automatically renews for one-year terms unless cancelled in accordance with the terms and conditions of the lease. The lease terminated on July 31, 2020.

 

On July 26, 2018, we entered into a tenancy agreement for approximately 1,433 square feet of office space located at Unit 35.04, Level 35, Menara Standard Chartered, 30, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia. The monthly lease amount is approximately USD $2,518. The lease was for a two-year term, expiring on July 31, 2020. On June 22, 2020, TOGL Technology entered into a Business Centre Service Agreement for office space for nine people located at MYS – Menara AIA Sentral, Level 3 – 5, Menara AIA Sentral, No. 30 Jalan Sultan Ismail, Kuala Lumpur, Malaysia. The monthly lease payment was approximately USD $1,214. The lease ended on October 31, 2020.

 

On May 20, 2018, we entered into an Office Lease Agreement for approximately 5,195 square feet of office space located at 5th and 6th, 21st Floor, No. 6, Lane 256, Section 2, Xitun Road, Xitun District, Taichung City, Taiwan. The monthly lease payment is USD $2,274. The lease had a two-year term.

 

 
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On June 24, 2019, PT Toga Indonesia entered into a Tenancy Agreement for approximately 3,767 square feet of office space located on the 8th Floor, Unit D, Jalan Jenderal Sudirman Kaveling 60 Jakarta, Indonesia, locally known as the Menara Sudirman building. The monthly lease amount is approximately $8,633. The lease expires on July 31, 2021.

 

On December 10, 2018, PT Toga Indonesia entered into Amendment No. 1 to Office Space Lease Agreement for approximately 2,352 square feet of office space located at Plaza Asia, Unit C, Second Floor, JI. Jenderal Sudirman Kaveling 59, Jakarta, Indonesia 12190. PT Toga Indonesia transferred its rights under the lease to PT TOGL Indonesia on July 15, 2019. The monthly lease payment is approximately USD $3,079, and the lease expired on January 31, 2021.

 

On April 25, 2019, Toga Vietnam entered into an Office Service Agreement for co-working and virtual office space located at 33 Le Duan Street, District 1, 11th Floor, Ho Chi Minh City, Vietnam. The monthly lease payment is approximately USD $1,536. The agreement originally terminated on May 31, 2020; however, it was renewed for an additional one-year term, expiring on May 31, 2021.

 

On June 15, 2020, we entered into an Office Agreement for an office located at 2266 South Dobson Road, Suite 200, Mesa, Arizona 85202. The monthly fees are approximately $567. The agreement is month-to-month.

 

On October 17, 2018, TOGL Technology entered into two Sale and Purchase Agreements (the “First Mammoth Agreements”) with Mammoth Empire Estate Sdn. Bhd., a Malaysian corporation (“Mammoth”), for the purchase of 30,705 square feet of space located in the Empire Damansara building. The Empire Damansara building consists of 30 floors and a total of 303,000 useable square feet. The 30,705 square feet of space purchased is comprised of 7,524 square feet on the ground floor of the Empire Damansara, and all of the 28th, 29th, and 30th floors (the 30th floor is the rooftop terrace). Pursuant to the First Mammoth Agreements, we entered into a Subscription Agreement with Mammoth dated November 29, 2018 for the purchase of 470,477 shares of our Common Stock for an aggregate purchase price of approximately $3,999,049 remitted by Mammoth in the form of legal title to those certain portions of real property. As of January 28, 2021, legal title has not been passed to us, however the bank serving as the bridging financier for the property has disclaimed its interest in such property in favor of TOGL, and the shares have been issued pursuant to the First Mammoth Agreements as of March 5, 2019.

 

On July 29, 2019, TOGL Technology entered into two Sale and Purchase Agreements (the “Second Mammoth Agreements”) with Mammoth, for the purchase of additional real estate located in the Empire Damansara. The Second Mammoth Agreements relate to the acquisition of an additional 11,614 square feet of space in the Empire Damansara. This additional space is located on the Level Basement 1 and Level Basement 3 of the building. Pursuant to the Second Mammoth Agreements, we entered into a Subscription Agreement with Mammoth dated July 29, 2019 for the purchase of an aggregate of 118,174 shares of our Common Stock for an aggregate purchase price of approximately $1,418,087, valued at $12.00 per share, which was the closing price of the shares on July 29, 2019 as reported by the OTC Markets Group Inc.’s (“OTCM”) Pink Open Market (“OTC Pink”). Mammoth agreed to pay the purchase price in the form of legal title to those certain portions of real estate set forth in the Mammoth Agreements. As of January 28, 2021, legal title has not been passed to us and no shares have been issued pursuant to the Second Mammoth Agreements. We are still awaiting the bank serving as the bridging financier to disclaim its interest in such property in favor of TOGL.

 

On June 1, 2020, TOGL Technology entered into two Tenancy Agreements with Eostre Bhd. related to the approximately 11,614 square feet in total built up area of Level Basement 1 and Level Basement 3, SOHO 2, Empire Damansara, No. 2, Jalan PJU 8/8A, Damansara Perdana, PJU 8, Petaling Jaya, 47820 Selangor Darul Ehsan. The monthly lease payments are approximately USD $14,648. The term of the agreements are three years, terminating on May 31, 2023; however, the parties can extend for another three-year renewal term at a revised lease amount.

   

Item 3. Legal Proceedings.

 

We currently have no legal proceeding to which we are a party to or to which our property is subject to and, to the best of our knowledge, no adverse legal activity is anticipated or threatened.

 

Item 4. Mine Safety Disclosures.

 

Not applicable.

 

 
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PART II

 

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

 

Market Information

 

Our Common Stock is quoted on the OTC Pink under the symbol “TOGL.” There is currently a limited trading market in our shares of Common Stock.

 

Set forth below are the range of high and low closing bid prices for the periods indicated as reported by the OTC Pink. The market quotations reflect inter-dealer prices, without retail mark-up, mark-down, or commissions and may not necessarily represent actual transactions.

 

Quarter Ended

 

High Bid

 

 

Low Bid

 

Fourth Quarter 2018 (May 1, 2018 – July 31, 2018)

 

$ 6.70

 

 

$ 4.50

 

First Quarter 2019 (August 1, 2018 – October 31, 2018)

 

$ 8.60

 

 

$ 5.40

 

Second Quarter 2019 (November 1, 2018 – January 31, 2019)

 

$ 8.60

 

 

$ 4.30

 

Third Quarter 2019 (February 1, 2019 – April 30, 2019)

 

$ 9.368

 

 

$ 7.80

 

Fourth Quarter 2019 (May 1, 2019 – July 31, 2019)

 

$ 12.50

 

 

$ 9.10

 

First Quarter 2020 (August 1, 2019 – October 31, 2019)

 

$ 15.454

 

 

$ 8.00

 

Second Quarter 2020 (November 1, 2019 – January 31, 2020)

 

$ 14.42

 

 

$ 11.10

 

Third Quarter 2020 (February 1, 2020 – April 30, 2020)

 

$ 13.65

 

 

$ 4.00

 

Fourth Quarter 2020 (May 1, 2020 – July 31, 2020)

 

$ 12.90

 

 

$ 4.10

 

First Quarter 2021 (August 1, 2020 – October 31, 2020)

 

$ 14.00

 

 

$ 7.90

 

Second Quarter 2021 (November 1, 2020 – January 31, 2021) (1)

 

 

11.05

 

 

 

2.00

 

 

(1) Through January 29, 2021

 

On January 29, 2021, the closing bid price of our Common Stock as reported by the OTC Pink was $8.00 per share.

 

 
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Holders

 

As of January 28, 2021, we estimate there were approximately 5,295 holders of record. As of January 28, 2021, 91,013,640 shares of our Common Stock were issued and outstanding.

   

Dividends

 

We have never declared or paid any cash dividends on our Common Stock and do not intend to pay any cash dividends in the foreseeable future. We currently intend to retain all future earnings in order to finance the operation and expansion of our business. In addition, the payment of dividends, if any, in the future, is within the discretion of our Board and will depend on our earnings, capital requirements, financial conditions, and other relevant factors as our Board may consider. The Nevada Revised Statutes (“NRS”) prohibits us from declaring dividends, where, after giving effect to the distribution of the dividend:

 

 

·

we would not be able to pay our debts as they become due in the usual course of business; or

 

 

 

 

·

our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of stockholders who have preferential rights superior to those receiving the distribution, unless otherwise permitted under our A&R Articles of Incorporation.

 

Securities Authorized for Issuance under Equity Compensation Plans

 

The following table summarizes certain information regarding our equity compensation plans as of July 31, 2020:

 

Plan category

 

Number of
securities to be
issued upon exercise
of outstanding
options, warrants
and rights
(a)

 

 

Weighted-average
exercise price of
outstanding options,
warrants and rights
(b)

 

 

Number of securities
remaining available for
future issuance under
equity compensation plans
(excluding securities
reflected in column (a))
(c)

 

Equity compensation plans approved by security holders

 

 

-

 

 

 

-

 

 

 

-

 

Equity compensation plans not approved by security holders

 

 

-

 

 

$ -

 

 

 

10,000,000 (1)

Total

 

 

-

 

 

$ -

 

 

 

10,000,000 (1)

  

 

(1)

Represents the number of shares authorized for issuance under the A&R Incentive Plan (as defined below) as of January 31, 2021. The A&R Incentive Plan was adopted by our stockholders after the end of our 2020 fiscal year.

  

 
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On June 10, 2020, our Board adopted and approved a Long-Term Incentive Plan (the “Plan”). Our Board subsequently amended and restated the Plan on July 14, 2020 (the “A&R Incentive Plan”), which became effective upon stockholder approval on September 9, 2020. The purpose of the A&R Incentive Plan is to foster our growth and success by providing a means to attract, motivate, and retain key employees, directors, and contractors (“Participants”) through awards of stock options, stock appreciation rights, restricted stock awards, unrestricted stock awards, and restricted stock units (collectively, “Awards”).

 

Under the terms of the A&R Incentive Plan, Awards to purchase up to 10,000,000 shares of our Common Stock (the “Shares”) may be granted to eligible Participants. The A&R Incentive Plan will continue to be effective for a term of ten (10) years from the date the A&R Incentive Plan was approved by our stockholders, unless terminated earlier pursuant to the terms of the A&R Incentive Plan. The A&R Incentive Plan is administered by our Board, or any committee of directors designated by our Board and their respective delegates, as described in the A&R Incentive Plan.

 

The A&R Incentive Plan provides that the aggregate number of the Shares subject to Awards granted under the A&R Incentive Plan during any fiscal year to any one Participant cannot exceed 100,000 Shares, or if an Award is settled in cash, the maximum amount of any cash award allocable to any one employee during a single fiscal year cannot exceed the then-current fair market value of such Shares.

 

The A&R Incentive Plan provides that the aggregate number of the Shares that may be issued under the A&R Incentive Plan through incentive stock options (intended to qualify as such within the meaning of Section 422 of the Internal Revenue Code, the “Incentive Stock Options”) cannot exceed one hundred percent (100%) of the maximum aggregate number of the Shares that may be subject to or delivered under Awards granted under the A&R Incentive Plan, as the same may be amended from time to time under the terms of the A&R Incentive Plan. Notwithstanding the designation “Incentive Stock Option” in an option agreement, if and to the extent that the aggregate fair market value of the Shares with respect to which the Incentive Stock Options are exercisable for the first time by the recipient during any calendar year (under all our plans and any of our subsidiaries’ plans) exceeds U.S. $100,000, such options will be treated as nonqualified stock options under the A&R Incentive Plan. The A&R Incentive Plan also provides that the aggregate fair market value (computed as of the date of grant in accordance with applicable financial accounting rules) of all Awards granted to any non-employee director of the Company during any single calendar year cannot exceed two thousand (2,000) Shares, or if an Award is settled in cash, the maximum amount of cash award allocable to any one non-employee director during a single fiscal year cannot exceed the then-current fair market value of such number of Shares.

 

Options granted under the A&R Incentive Plan become exercisable and expire as determined by our Board or committee, as applicable. The stockholders approved and adopted the A&R Incentive Plan at a special meeting of the stockholders held on September 9, 2020.

 

Recent Sales of Unregistered Securities

 

Except as set forth below, during our fiscal years ended July 31, 2020 and 2019, all sales of equity securities that were not registered under the Securities Act were previously reported in a Quarterly Report on Form 10-Q or in a Current Report on Form 8-K.

 

 
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Employee Stock Bonus Agreements

 

On April 1, 2018, we entered into Employee Stock Bonus Agreements with 29 of our employees, pursuant to which we agreed to issue to such employees an aggregate of 348,953 shares of our restricted Common Stock. The shares vested, subject to the terms and conditions of the various agreements, on April 1, 2019. The shares were subsequently issued on May 28, 2019. Of the 348,953 shares: 50,700 shares were issued to Mr. Toh; 4,819 shares were issued to Mr. Lim; 38,588 shares were issued to Mr. Ng; and 75,000 shares were issued to Mr. Tan. The 348,953 shares had a value of $3,210,377 based on the closing price of our Common Stock on the May 28, 2019, as reported by the OTCM. The shares of our Common Stock were issued in as a bonus to these employees for services rendered to us.

 

On July 15, 2018, we entered into Employee Stock Bonus Agreements with 27 of our employees, pursuant to which we agreed to issue to such employees an aggregate of 253,039 shares of our restricted Common Stock. The shares vested, subject to the terms and conditions of the various agreements, on July 15, 2019. The shares were issued on November 7, 2019. Of the 253,039 shares: 57,253 shares were issued to Mr. Toh; 39,994 were issued to Mr. Ng; and 3,250 were issued to Mr. Lim. The 253,039 shares had a value of $3,289,507 based on the closing price of our Common Stock on the November 7, 2019, as reported by the OTCM. The shares of our Common Stock were issued in as a bonus to these employees for services rendered to us.

  

On December 1, 2018, we entered into Employee Stock Bonus Agreements with 32 of our employees, pursuant to which we agreed to issue to such employees an aggregate of 782,959 shares of our restricted Common Stock. The shares vested, subject to the terms and conditions of the various agreements, on December 1, 2019. On February 22, 2019, 577,391 shares were issued. The balance of the shares, or 205,568 shares, were issued on April 1, 2019. Of the 782,959 shares: 63,050 shares were issued to Mr. Toh; 9,602 shares were issued to Mr. Lim; 56,552 shares were issued to Mr. Ng; and 200,593 were issued to Mr. Tan. The 782,959 shares had a value of $6,805,297 based on the closing price of our Common Stock on the February 22, 2019 and April 1, 2019, respectively, as reported by the OTCM. The shares of our Common Stock were issued in as a bonus to these employees for services rendered to us.

  

These issuances of shares of our Common Stock are qualified for the exemption from registration contained in Section 4(a)(2) of the Securities Act (in that the issuance of shares of our Common Stock did not involve any public offering).

 

Independent Director Issuances

 

On August 1, 2019, we agreed to provide each of our independent directors, Iain Bratt, Jim Lupkin, and Shemori BoShae Guinn, with the following: (a) cash compensation in the amount of $3,000 per fiscal quarter, with anyone serving as chairperson of any of our Board committees receiving an additional $1,000 per quarter; and (b) at the end of each fiscal quarter, such number of shares of our Common Stock that have a market value of $1,500 determined by using the average closing bid price of our Common Stock during each trading day of the last thirty (30) trading day period immediately preceding the end of the applicable fiscal quarter.

 

 
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Pursuant such agreement, we issued to each of our Independent Directors:

 

 

·

105 shares of our Common Stock for the quarter ended October 31, 2019, based on a price per share of $14.28;

 

 

 

 

·

113 shares of our Common Stock for the quarter ended January 31, 2020, based on a price per share of $13.35;

 

 

 

 

·

280 shares of our Common Stock for the quarter ended April 30, 2020, based on a price per share of $5.35;

 

 

 

 

·

127 shares of our Common Stock for the quarter ended July 31, 2020, based on a price per share of $11.81; and

 

 

 

 

·

149 shares of our Common Stock for the quarter ended October 31, 2020, based on a price per share of $10.07.

 

These issuances of shares of our Common Stock are qualified for the exemption from registration contained in Section 4(a)(2) of the Securities Act (in that the issuance of shares of our Common Stock did not involve any public offering).

 

Repurchases

 

We did not, nor did any affiliated purchaser, make any repurchases of our equity securities during the quarters ended July 31, 2020 and 2019.

 

Item 6. Selected Financial Data

 

Not applicable.

 

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

The following discussion and analysis of our results of operations and financial condition for fiscal years ended July 31, 2019 and 2018, should be read in conjunction with our consolidated financial statements and the related notes and the other financial information that are included elsewhere in this Amended Annual Report. This discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations, and intentions. Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results, or other developments. Forward-looking statements are based upon estimates, forecasts, and assumptions that are inherently subject to significant business, economic, and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward-looking statements. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those set forth under the Risk Factors, Special Note Regarding Forward-Looking Statements, and Business sections in this Amended Annual Report. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to identify forward-looking statements.

 

Subsequent Event – COVID-19

 

In March 2020, the World Health Organization declared the outbreak of COVID-19 as a pandemic based on the rapid increase in global exposure. COVID-19 continues to spread throughout the world. We are closely monitoring developments and are taking steps to mitigate the potential risks related to the COVID-19 pandemic to us, our employees, and our customers. To protect our employees while continuing to provide the services needed by our clients, we limited customer contact and minimized employee contact with other employees by having our employees work remotely.

 

 
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On March 19, 2020, the Malaysian Prime Minister issued a Movement Control Order (MCO), which reduced movement within Malaysia and cancelled all non-essential travel and limited travel from outsiders deemed as non-essential. Eventually, the MCO was lifted as of June 9, 2020, and certain safe-distance and other controlling protocols were put into place, which were in effect until December 31, 2020. The Malaysian Government has since extended the MCO until January 26 and then again to March 31, 2021.

 

Our offices in Malaysia closed as a result of the MCO, and our office-based employees located both in Malaysia, Vietnam, Indonesia, and in the United States have been working remotely since the middle of March. All of our employees have been able to continue to address customer needs in a timely fashion. Travel remains restricted to limit the risk of our employees coming in contact with COVID-19.

 

As a result of COVID-19, we have terminated certain agreements with Agel and Toga Japan. Please see Item 1. Business, Recent Changes to the Eostre Business, for additional information.

 

Through July 31, 2020, we have not had any of our employees contract COVID-19. Should a significant number of our employees contract COVID-19, our ability to serve our customers in a timely fashion could be negatively impacted on our ability to serve customers in a timely fashion.

 

In addition to the termination of the License Agreements and the Yipps Agreement, COVID-19 also has negatively impacted our business with respect to TogaGo revenue. The MCO restricted travel, which resulted in customers not booking travel and hotels through the Yippi app. TogaGo’s revenue decreased significantly during the year ended July 31, 2020. However, we expect TogaGo’s revenue to increase once the MCO is lifted.

 

Further, while we have not yet experienced any interruption to our normal materials and supplies process, it is impossible to predict whether COVID-19 will cause future interruptions and delays.

 

 
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Results of Operations

 

Fiscal Year Ended July 31, 2019 (Restated) Compared to Fiscal Year Ended July 31, 2018

     

 

 

Year ended

 

 

 

 

 

 

 

 

 

July 31,

 

 

 

 

 

 

 

 

 

2019

(Restated)

 

 

2018

 

 

Change

 

 

%

 

Revenue

 

$ 5,888,234

 

 

$ 1,254,495

 

 

$ 4,633,739

 

 

 

369.4 %

Cost of Goods Sold

 

 

1,729,748

 

 

 

145,847

 

 

 

1,583,901

 

 

 

1,086.0 %

Gross Profit (Loss)

 

$ 4,158,486

 

 

$ 1,108,648

 

 

$ 3,049,838

 

 

 

275.1 %

Gross Margin

 

 

70.62 %

 

 

88.37 %

 

 

 

 

 

 

 

 

 

Gross Margin by product for the year ended July 31, 2019 (restated)

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software
Maintenance

 

 

 

 

 

 

 Product

 

 

 

 

 

 Royalty

 

 

Management

 

 

 

 

 

 

 

 

&

 

 

 

 

 

 

Sales

 

 

Advertising

 

 

Fee

 

 

Fee

 

 

Yippi

 

 

TogaGo

 

 

Subscription

 

 

Total

 

Revenue

 

$ 4,273,252

 

 

$ 190,400

 

 

$ 240,000

 

 

$ 1,072,630

 

 

$ -

 

 

$ -

 

 

$ 111,952

 

 

$ 5,888,234

 

Cost of Goods Sold

 

 

379,237

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,337,477

 

 

 

13,034

 

 

 

-

 

 

 

1,729,748

 

Gross Profit (Loss)

 

$ 3,894,015

 

 

$ 190,400

 

 

$ 240,000

 

 

$ 1,072,630

 

 

$ (1,337,477 )

 

$ (13,034 )

 

$ 111,952

 

 

$ 4,158,486

 

Gross Margin

 

 

91.13 %

 

 

100.00 %

 

 

100.00 %

 

 

100.00 %

 

 

-

 

 

 

-

 

 

 

100.00 %

 

 

70.62 %

 

Gross Margin by product for the year ended July 31, 2018

 

 

 

 

 

 

 

 

 

 

 

Software
Maintenance 

 

 

 

 

 

Product

 

 

 

 

Management

 

 

 

 

 

 

 

 

 

Sales

 

 

Advertising

 

 

Fee

 

 

Yippi

 

 

Subscription

 

 

Total

 

Revenue

 

$ 29,345

 

 

$ 141,893

 

 

$ 531,449

 

 

$ -

 

 

$ 551,808

 

 

$ 1,254,495

 

Cost of Goods Sold

 

 

2,087

 

 

 

-

 

 

 

-

 

 

 

143,760

 

 

 

-

 

 

 

145,847

 

Gross Profit (Loss)

 

$ 27,258

 

 

$ 141,893

 

 

$ 531,449

 

 

$ (143,760 )

 

$ 551,808

 

 

$ 1,108,648

 

Gross Margin

 

 

92.89 %

 

 

100.00 %

 

 

100.00 %

 

 

-

 

 

 

100.00 %

 

 

88.37 %

 

Revenue increased by approximately $4.6 million in the year ended July 31, 2019, compared to the prior year period, driven by a $4.7 million increase in revenue generated by new business lines, such as product sales of the Company’s Eostre brand and management fees.

 

 
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Gross profit also increased by approximately $3.0 million in the year ended July 31, 2019, compared to the prior year period, due to the new business lines. We invested significantly in staff and infrastructure, which was in the early implementation stage, but management expects reductions in our general and administrative expenses as a percentage of revenue going forward.

 

 

 

Year ended

 

 

 

 

 

 

 

 

 

July 31,

 

 

 

 

 

 

 

 

 

2019

(Restated)

 

 

2018

 

 

Change

 

 

%

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

$ 3,183,220

 

 

 

726,016

 

 

 

2,457,204

 

 

 

338.5 %

Salaries and wages

 

 

13,074,717

 

 

 

467,621

 

 

 

12,607,096

 

 

 

2,696.0 %

Professional fees

 

 

1,110,236

 

 

 

443,068

 

 

 

667,168

 

 

 

150.6 %

Depreciation

 

 

93,426

 

 

 

15,050

 

 

 

78,376

 

 

 

520.8 %

Total operating expenses

 

 

17,461,599

 

 

 

1,651,755

 

 

 

15,809,844

 

 

 

957.2 %

Loss from Operations

 

 

(13,303,113 )

 

 

(543,107 )

 

 

(12,760,006 )

 

 

2,349.4 %

Other Income (Expense)

 

 

3,246,419

 

 

 

(13,077,201 )

 

 

16,323,620

 

 

 

(124.8 )%

Net Loss

 

$ (10,212,214 )

 

 

(13,620,308 )

 

 

3,408,094

 

 

 

(25.0 )%

 

Net loss decreased by approximately $3.4 million, or 25%, in the year ended July 31, 2019, compared to the prior year period, due to a decrease in other expense of $16.3 million, offset by an increase in loss from operations primarily attributed to the increases in salary and wages, including stock-based compensation of approximately $11.1 million, offset by an increase in gross profit of approximately $3.3 million.

 

Segment Operating Performance

 

Our operating performance by segment are as follows for the year ended July 31, 2019 and 2018:

 

Year ended July 31, 2019 (restated):

   

 

 

USA

 

 

Malaysia

 

 

Taiwan

 

 

Vietnam

 

 

Indonesia

 

 

Total

 

Revenue

 

$ 240,000

 

 

$ 1,356,336

 

 

$ 1,673,781

 

 

$ -

 

 

$ 2,618,117

 

 

$ 5,888,234

 

Gross Profit

 

$ 240,000

 

 

$ 2,924

 

 

$ 1,531,364

 

 

$ -

 

 

$ 2,384,198

 

 

$ 4,158,486

 

Gross Margin

 

 

100.00 %

 

 

0.22 %

 

 

91.49 %

 

 

-

 

 

 

91.07 %

 

 

70.62 %

Net Loss

 

$ (8,553,305 )

 

$ (2,821,738 )

 

$ 287,569

 

 

$ (8,737 )

 

$ 883,997

 

 

$ (10,212,214 )

 

 
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Year ended July 31, 2018:

 

 

 

USA

 

 

Malaysia

 

 

Taiwan

 

 

Vietnam

 

 

Indonesia

 

 

Total

 

Revenue

 

$ -

 

 

$ 1,225,149

 

 

$ 29,346

 

 

$ -

 

 

$ -

 

 

$ 1,254,495

 

Gross Profit (Loss)

 

$ -

 

 

$ 1,081,389

 

 

$ 27,259

 

 

$ -

 

 

$ -

 

 

$ 1,108,648

 

Gross Margin

 

 

-

 

 

 

88.27 %

 

 

92.89 %

 

 

-

 

 

 

-

 

 

 

88.37 %

Net Income (Loss)

 

$ (13,853,448 )

 

$ 307,381

 

 

$ 862

 

 

$ -

 

 

$ (75,103 )

 

$ (13,620,308 )

 

During the year ended July 31, 2019, most of our revenue was derived from management fees generated in Malaysia, product sales of the Company’s Eostre brand generated in Taiwan and in Indonesia. During the year ended July 31, 2018, most of our revenue was derived from management fees Software Maintenance & Subscription generated in Malaysia. Net loss decreased by approximately $3.4 million due to the decrease in other expense offset by the increase in loss from operations. During the year ended July 31, 2018, the operations were primarily in Malaysia. We recognized a net loss, primarily due to a loss from debt settlement of $13.3 million.

   

Liquidity and Capital Resources

 

 

 

July 31,

 

 

 

 

 

 

 

 

 

 

2019

(Restated)

 

 

July 31,

2018

 

 

Change

 

 

%

 

Cash and cash equivalents

 

$ 14,916,556

 

 

$ 1,064,672

 

 

$ 13,851,884

 

 

 

1,301.0 %

Total Assets

 

$ 23,554,425

 

 

$ 2,952,954

 

 

$ 20,601,471

 

 

 

697.7 %

Total Liabilities

 

$ 9,049,782

 

 

$ 411,589

 

 

$ 8,638,193

 

 

 

2,098.7 %

Working Capital

 

$ 10,080,247

 

 

$ 1,046,959

 

 

$ 9,033,288

 

 

 

862.8 %

 

As of July 31, 2019, our total assets were $23.6 million, and our total liabilities were $9.0 million. Liabilities were comprised primarily of current liabilities of $9.0 million, of which included accounts payable and accrued liabilities of $4.2 million and deferred revenue of $4.7 million.

 

Our stockholders’ equity increased from $2.5 million as of July 31, 2018 to $14.7 million as of July 31, 2019.

 

We had $14.9 million in cash as of July 31, 2019, and we had assets to meet ongoing expenses or debts that may accumulate. Accumulated deficit was $24.6 million as of July 31, 2019, compared to accumulated deficit of approximately $14.4 million as of July 31, 2018.

 

Our working capital increased by $9.0 million to $10.1 million at July 31, 2019, as compared to $1.1 million at July 31, 2018, due primarily to the increase in our current assets, consisting of an increase in cash and cash equivalents of $13.9 million and an increase in prepaid expense and other current assets of $3.7 million, and the increase in our current liabilities, consisting of an increase in accounts payable and accrued liabilities of $4.0 million and deferred revenue of $4.7 million.

 

 
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Cash Flow

 

 

 

Year ended

 

 

 

 

 

 

 

 

 

July 31,

 

 

Change

 

 

 

2019

(Restated)

 

 

2018

 

 

Amount

 

 

%

 

Cash Flows provided by (used in) operating activities

 

$ 2,729,719

 

 

$ (492,089 )

 

$ 3,221,808

 

 

(654.7%)

 

Cash Flows (used in) investing activities

 

 

(372,077 )

 

 

(152,287 )

 

 

(219,790 )

 

 

144.3 %

Cash Flows provided by financing activities

 

 

11,371,008

 

 

 

1,698,818

 

 

 

9,672,190

 

 

 

569.3 %

Effects on changes in foreign exchange rate

 

 

123,234

 

 

 

10,130

 

 

 

113,104

 

 

 

1,116.5 %

Net change in cash and cash equivalents during period

 

$ 13,851,884

 

 

$ 1,064,572

 

 

$ 12,787,312

 

 

 

1,201.2 %

 

Cash Flow from Operating Activities

 

As of July 31, 2019, we had generated positive cash flow from operating activities. For the year ended July 31, 2019, net cash flows provided by operating activities was $2.7 million compared to $492,000 used in operating activities during the year ended July 31, 2018. Cash flows provided by operating activities for the year ended July 31, 2019 was comprised of a net loss of $10.2 million, which was increased by non-cash income of $3.2 million for gain on sale of digital currency, and was offset by non-cash expenses of $93,000 for depreciation, $11.1 million for stock-based compensation, and a net change in working capital of $5.0 million. Cash flows used in operating activities for the year ended July 31, 2018 was comprised of a net loss of $13.6 million, which was offset by non-cash expenses of $15,000 for depreciation, $13.3 million for loss on settlement of debt, and a net change in working capital of $169,000.

 

Cash Flows from Investing Activities

 

During the year ended July 31, 2019, we used $372,000 in investing activities for the purchase of property and equipment. During the year ended July 31, 2018, we used $152,000 for the purchase of property and equipment.

 

Cash Flows from Financing Activities

 

We have financed our operations primarily from either advances and loans from related and third parties or the issuance of equity instruments. For the year ended July 31, 2019, net cash provided by financing activities was $11.4 million, consisting of proceeds from the sale of shares of our Common Stock of $2.1 million, and proceeds from sales of digital currency of $9.5 million, offset by repayment to related parties of $185,000. For the year ended July 31, 2018, net cash provided by financing activities was $1.7 million, consisting of proceeds from the sale of shares of our Common Stock of $1.3 million and proceeds from related parties of $434,000, offset by repayment to related parties of $49,000.

 

 
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Off Balance Sheet Arrangements

 

We do not engage in any activities involving variable interest entities or off-balance sheet arrangements.

 

Contractual Obligations

 

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act, and are not required to provide the information under this Item.

 

Critical Accounting Policies and Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of income and expense during the reporting periods presented.

 

Our critical estimates include revenue recognition and intangible assets. Although we believe that these estimates are reasonable, actual results could differ from those estimates given a change in conditions or assumptions that have been consistently applied. We also have other policies that we consider key accounting policies, such as our policy for revenue recognition, however, the application of these policies does not require us to make significant estimates or judgments that are difficult or subjective.

 

Management has discussed the selection of critical accounting policies and estimates with our Board, and our Board has reviewed our disclosure relating to critical accounting policies and estimates in this Amended Annual Report. The critical accounting policies used by management and the methodology for its estimates and assumptions are as follows:

 

Revenue is generally recognized upon transfer of control, including the risks and rewards of ownership, of products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. We recognize revenues on contracts with customers in accordance with the ASC 606, including performing the following: (i) identifying the contract, (ii) identifying the performance obligations; (iii) determining the transaction price; (iv) allocating the transaction price; and (v) recognizing revenue upon fulfilment of obligations.

 

Stock-based Compensation is accounted for stock-based awards at fair value on the date of grant, and recognize compensation over the service-period that they are expected to vest. We estimate the fair value of stock options and stock purchase warrants using the Black-Scholes option pricing model. The estimated value of the portion of a stock-based award that is ultimately expected to vest, taking into consideration estimated forfeitures, is recognized as expense over the requisite service periods. The model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time, of other comparative securities, equal to the weighted average life of the options. The estimate of stock awards that will ultimately vest requires judgment, and to the extent that actual forfeitures differ from estimated forfeitures, such differences are accounted for as a cumulative adjustment to compensation expenses and recorded in the period that estimates are revised.

 

 
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Goodwill and Other Intangible Assets – digital currency is accounted for in accordance with ASC 350 “Intangibles-Goodwill and Other” (“ASC 350”). ASC 350 requires that goodwill and other intangibles with indefinite lives be tested for impairment annually or on an interim basis if events or circumstances indicate that the fair value of an asset has decreased below its carrying value. In addition, ASC 350 requires that goodwill be tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests when circumstances indicate that the recoverability of the carrying amount of goodwill may be in doubt. Application of the goodwill impairment test requires judgment, including the identification of reporting units; assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value. Significant judgments required to estimate the fair value of reporting units include estimating future cash flows, determining appropriate discount rates and other assumptions. Changes in these estimates and assumptions or the occurrence of one or more confirming events in future periods could cause the actual results or outcomes to materially differ from such estimates and could also affect the determination of fair value and/or goodwill impairment at future reporting dates.

 

Income Taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance on deferred tax assets is established when management considers it is more likely than not that some portion or all of the deferred tax assets will not be realized.

 

Tax benefits from an uncertain tax position are only recognized if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate resolution. Interest and penalties related to unrecognized tax benefits are recorded as incurred as a component of income tax expense. The Company has not recognized any tax benefits from uncertain tax positions for any of the reporting periods presented.

 

Impact of recently issued accounting pronouncements that have recently been issued but have not yet been implemented by us are described in Note 2, Summary of Significant Accounting Policies, to the Notes to the Consolidated Financial Statements to this Amended Annual Report, which describes the potential impact that these pronouncements are expected to have on our financial condition, results of operations, and cash flows.

 

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

 

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act, and are not required to provide the information under this Item.

 

Item 8. Financial Statements and Supplementary Data.

 

The information required by this Item is incorporated herein by reference to the consolidated financial statements and supplementary data set forth in Item 15. Exhibits, Financial Statement Schedules of Part IV of this Amended Annual Report.

 

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

 

Subsequent to fiscal 2019, and as previously disclosed by us in a Current Report on Form 8-K filed on July 13, 2020, we dismissed Pinnacle Accountancy Group of Utah (“Pinnacle”) as our independent registered public accounting firm on July 10, 2020. The Audit Committee participated in and approved of the decision to change our independent registered public accounting firm. Pinnacle’s audit report on our consolidated financial statements as of and for the year ended July 31, 2019 did not contain an adverse opinion or a disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope, or accounting principles.

 

During the year ended July 31, 2019, and through the subsequent interim period through July 10, 2020, there were no (i) no disagreements (as described in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) between Pinnacle and us on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which, if not resolved to Pinnacle’s satisfaction, would have caused Pinnacle to make reference thereto in their reports on the consolidated financial statements for such years, and (ii) no “reportable events” within the meaning of Item 304(a)(1)(v) of Regulation S-K.

 

 
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Contemporaneously, on July 10, 2020, the Audit Committee appointed Marcum LLP (“Marcum”) as our independent registered public accounting firm for the year ended July 31, 2020, and for the quarterly reports for fiscal 2021. Prior to engaging Marcum, we did not consult with it regarding (i) the application of accounting principles to a specific completed or contemplated transaction or regarding the type of audit opinions that might be rendered by Marcum on our financial statements, and Marcum did not provide any written or oral advice that was an important factor considered by us in reaching a decision as to any such accounting, auditing, or financial reporting issue, or (ii) a disagreement or reportable event as described under Item 304(a)(2)(ii) of Regulation S-K.

 

There are no reportable events under Item 304(a)(1)(v) of Regulation S-K promulgated under the Exchange Act that occurred during (i) the fiscal years ended July 31, 2019 and 2018 or (ii) during the interim period from August 1, 2019 through July 10, 2020.

 

Item 9A. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer(s) and principal financial officer(s), or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 

In accordance with Exchange Act Rules 13a-15 and 15d-15, an evaluation was completed under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the fiscal year ended July 31, 2019. Based on that evaluation, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were not effective in providing reasonable assurance that information required to be disclosed in our reports filed or submitted under the Exchange Act was recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms.

 

Management’s Annual Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as such term is defined by Rules 13a-15(f) and 15d-15(f) of the Exchange Act). Internal control over financial reporting is a process, including policies and procedures, designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with U.S. generally accepted accounting principles. Our management evaluated the effectiveness of our internal control over financial reporting using the Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Our system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

 

 
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Internal control over financial reporting has inherent limitations and may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable, not absolute, assurance with respect to financial statement preparation and presentation. Further, because of changes in conditions, the effectiveness of internal control over financial reporting may vary over time.

 

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

 

Based on our evaluation under the framework in COSO, our management concluded that our internal control over financial reporting was not effective as of July 31, 2019 based on such criteria. Deficiencies existed in the design or operation of our internal control over financial reporting that adversely affected our internal controls. This is due to the lack of segregation of duties throughout our accounting and finance group as a result of our limited resources and staff, which may be considered a material weakness. We do not have a formal process in reviewing, approving, closing, or finalizing the financial reporting or closing process.

 

In January 2020 we engaged an external consulting firm to assist with the design and implementation of our internal process, including those internal controls over financial reporting. Due to the COVID-19 pandemic, the lockdowns instituted by local governments and travel restrictions in each of the countries for our subsidiaries, including but not limited to, our international operation headquarters in Kuala Lumpur, Malaysia and our corporate offices in Los Angeles California, we have not been able to implement these internal controls as of the date of this filing.

 

The weaknesses and the related risks are not uncommon in a company of our size because of the limitations in the size and number of staff. We continue to evaluate and implement procedures as deemed appropriate to remediate this weakness. To address these material weaknesses, a number of the procedures have been implemented, including the retention of qualified accounting and finance staff and we are also working with an outside financial firm to assist with the preparation and review of our financial statements and periodic reports, to ensure that the financial statements fairly present, in all material respects, our financial position, results of operations, and cash flows for the periods presented.

 

In addition, we intend to undertake the following additional remediation measures to address the material weaknesses described in this Amended Annual Report:

 

 

(i)

we intend to update the documentation of our internal control processes, including formal risk assessment of our financial reporting processes; and

 

 

 

 

(ii)

we intend to implement procedures pursuant to which we can ensure segregation of duties and hire additional resources to ensure appropriate review and oversight.

 

 
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Due to COVID-19, we have been unable to commence taking any of these remedial measures.

 

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met under all potential conditions, regardless of how remote, and may not prevent or detect all errors and all fraud. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of a simple error or mistake. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

 

Auditor’s Report on Internal Control over Financial Reporting

 

At the time of the filing of the Original Form 10-K, we believed that were not an “accelerated” filer, as defined in Rule 12b-2 under the Exchange Act, based on an error in our calculation of the aggregate worldwide market value of our voting and non-voting common equity held by our non-affiliates. Because of our erroneous determination that we were not an “accelerated” filer, we did not include in the Original Form 10-K filing an attestation report of our independent registered public accounting firm regarding internal control over financial reporting (for a “non-accelerated” filer, management’s report would not be required to be attested by our independent registered public accounting firm pursuant to Item 308(b) of Regulation S-K.)

 

In the course of preparing Amendment No. 1, we reviewed our calculation and realized that the original calculation had been in error. We were actually an “accelerated” filer pursuant to the definition of accelerated filer in place at the time we filed the Original Form 10-K (the definition of “accelerated” filer has since been amended pursuant to Release No. 34-88365, effective April 27, 2020, and under the new definition, we would not be an “accelerated” filer for the fiscal year ended July 31, 2019 because of its status as a small reporting company).

 

We consulted with Pinnacle, which served as our independent registered public accountant for the year ended July 31, 2019, regarding obtaining an attestation report regarding internal control over financial reporting for the year ended July 31, 2019, even considering that management has already concluded that internal control over financial reporting was not effective as of July 31, 2019 (and our disclosure of such material weakness, as described herein). In consideration of the significant amount of time and cost involved in obtaining such attestation report in connection with Amendment No. 1, we have determined that obtaining such attestation report is impracticable without undue hardship and expense to us.

 

Changes in Internal Controls over Financial Reporting

 

In connection with our continued monitoring and maintenance of our controls procedures as part of the implementation of Section 404 of the Sarbanes-Oxley Act, we continue to review, test, and improve the effectiveness of our internal controls. There have not been any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the year ended July 31, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

Item 9B. Other Information.

 

None.

 

 
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PART III

 

Item 10. Directors, Executive Officers and Corporate Governance

 

Directors and Executive Officers

 

Each of our directors holds office until the next annual meeting of our stockholders or until his or her successor has been elected and qualified, or until his or her earlier death, resignation, or removal. Our executive officers are appointed by our Board and serve until their respective successors are elected and appointed and qualify until their earlier resignation or removal from office.

Our current directors and executive officers, their ages, positions held, and duration of such, are as follows:

 

Name

 

Position Held with Our Company

 

Age

 

Date First Elected or Appointed

 

 

 

 

 

 

 

Michael Toh Kok Soon

 

President, Chief Executive Officer, and Chairman

 

35

 

June 13, 2016

Alexander D. Henderson

 

Chief Financial Officer, Secretary, Treasurer, and Director

 

55

 

February 12, 2019

Steve Tan See Kuy

 

Group General Manager – TOGL Technology

 

63

 

January 1, 2018

Roy Lim Jun Hao

 

Deputy Executive Officer – TOGL Technology

 

30

 

November 1, 2019

Edward Ng Boon Chee

 

Chief Operating Officer – TOGL Technology

 

34

 

April 1, 2018

Iain Bratt

 

Director

 

57

 

July 18, 2019

Jim Lupkin

 

Director

 

43

 

July 18, 2019

Shemori BoShae Guinn

 

Director

 

37

 

July 18, 2019

 

Former Directors and Executive Officers

 

Name

 

Position Held with Our Company

 

Age

 

Dates in Position or Office

 

 

 

 

 

 

 

William Liew Choon Fook

 

Secretary and Director

 

69

 

August 29, 2017 – July 18, 2019

 

Business Experience

 

The following is a brief account of the education and business experience of directors and executive officers during at least the past five years, indicating their principal occupation during the period, the name and principal business of the organization by which they were employed, and certain of their other directorships:

 

Michael Toh Kok Soon, Chief Executive Officer, President, and Chairman of our Board

 

Michael Toh Kok Soon has been our Chief Executive Officer, President, and Chairman of our Board since 2016. Since January 2018, Mr. Toh has also served as the Chief Executive Officer of our wholly owned subsidiary, TOGL Technology. From February 2015 until February 2018, Mr. Toh served as the Chief Executive Officer and a director of Toga Capital; Mr. Toh ceased being affiliated with Toga Capital when he resigned his positions and sold all of his ownership in the Toga Capital in February 2018 (effective September 18, 2018). Mr. Toh obtained a Bachelor of Engineering Electronics degree in Telecommunications, with distinction, from the Multimedia University in Melaka, Malaysia in 2007. Telecommunications engineering is a branch of engineering that combines the disciplines of electronics, communications, and computer science to design, develop, improve, and maintain telecommunications systems. Mr. Toh also received his MBA from Melbourne University and Doctorate from London School of Economics (LSE) in 2018. We believe that Mr. Toh is qualified to serve on our Board because of his knowledge of our current operations and his vision for the Company, in addition to his education, business and marketing experiences described above.

 

 
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Alexander D. Henderson, Chief Financial Officer, Secretary, Treasurer, and Director

 

Alexander D. Henderson has served as our Chief Financial Officer, Secretary, and Treasurer, since February 12, 2019, and as a member of our Board since July 18, 2019. Mr. Henderson is a finance and accounting professional with 30 years of experience. From October 2016 to November 2018, Mr. Henderson served as the Chief Financial Officer of Cingular Staffing, Inc. in Fullerton, California. From August 2015 to October 2016, Mr. Henderson was an executive, financial, and operational business consultant, working with entrepreneurs and their start-ups and small private companies in their efforts to become publicly traded, including preparation of financial statements to be in compliance with the U.S. Generally Accepted Accounting Principles (“GAAP”), as well as prepared financial projections and business plans to obtain private financing for such companies. From January 2013 to October 2015, Mr. Henderson was the Chief Financial Officer and a member of the board of directors of Motivating the Masses, Inc. Mr. Henderson assisted in taking the company public. In 1998, Mr. Henderson obtained a Bachelor of Science in Finance from National University and, in 2004, obtained a Master of Business Administration degree with a concentration in e-Business, also from National University. We believe that Mr. Henderson is qualified to serve on our Board because of his experience as a Chief Financial Officer and director of various public and privately held companies, his extensive accounting and financial experience, and his executive level experience with respect to implementing policies and procedures to comply with internal and external stakeholders’ reporting requirements.

 

Steve Tan See Kuy, Group General Manager – TOGL Technology

 

Steve Tan See Kuy has served as the Group General Manager of our wholly-owned subsidiary, TOGL Technology since December 2017. In this role, Mr. Tan is responsible for formulating overall strategy and establishing policies for TOGL Technology. From August 2016 to August 2017, Mr. Tan served as the Chief Executive Officer, President, Chief Financial Officer, and a director of VW Win Century, Inc., an SEC reporting company. From June 2010 to July 2016, Mr. Tan served as Chief Executive Officer of Glo Holdings Inc., located in Irvine, California. Mr. Tan obtained a Doctorate degree in Business Administration from the Midwest Missouri University in 2007, and received a Diploma in Marketing from the Royal Institute of Marketing in England in 1978.

 

Roy Lim Jun Hao, Deputy Executive Officer – TOGL Technology

 

Roy Lim Jun Hao has served as the Deputy Executive Officer of TOGL Technology since November 2019. In his role as Deputy Executive Officer, Mr. Lim leads the business development department in marketing activities, namely in increasing the number of downloads of the Yippi App, the daily active Yippi users, and monthly active Yippi users. Previously, Mr. Lim was a member of our Board from June 2018 until July 2019. Prior to that, Mr. Lim was the Chief Executive Officer of Toga Chat Academy, a training system for direct marketing independent sales agents, from January 2018 to October 2019. From February 2015 to April 2018, Mr. Lim served as the Chief Operating Officer and a director of Toga Capital; Mr. Lim ceased being affiliated with Toga Capital when he resigned his positions and sold all of his ownership in Toga Capital in February 2018 (effective September 18, 2018). Mr. Lim has been working as marketing executive since he graduated from high school in 2007. Mr. Lim has a variety of experience in marketing from small and medium enterprises to large enterprises across a variety of industries, including food and beverage, advertisement, telecommunication, information technology, and apparel.

 

 
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Edward Ng Boon Chee, Chief Operating Officer – TOGL Technology

 

Edward Ng Boon Chee has served as the Chief Operating Officer of TOGL Technology since April 2018. In this role, Mr. Ng oversees the day-to-day administrative and operational functions of TOGL Technology. Previously, Mr. Ng served as the Chief Management Officer of TOGL Technology, from January 2018 to March 2018. Mr. Ng also served as a member of our Board from June 2018 until July 2019. Prior to serving on our board, from December 2015 to May 2018, Mr. Ng served as the Chief Management Officer of Toga Capital. From 2014 to 2015, Mr. Ng was an executive administrator for Leroy International in Kuala Lumpur, Malaysia. From 2012 to 2013, Mr. Ng was an executive administrator with Gen Five Global. Mr. Ng obtained both a Bachelor of Arts degree in Marketing in 2013, and a Master’s in Business Administration degree in 2015, from the University of Hertfordshire.

 

William Liew Choon Fook, Former Secretary and Director

 

Mr. Liew served as our Secretary, beginning on August 29, 2017, and a member of our Board beginning on June 14, 2018, until his resignation from both position on July 18, 2019. In September 2017, Mr. Liew was also elected to the board of directors of our wholly owned subsidiary, TOGL Technology. Beginning in December 2016, Mr. Liew was also a director and Vice President of Operations of TogaChat Academy Philippines Inc. (except for the prior relationship with Liew Choon Fook, we do not have and have not had a direct or indirect relationship with TogaChat Academy Philippines Inc.). From January 1996 to August 2016, Mr. Liew founded and was the sole proprietor of Megawin Consultancy Services in Kuala Lumpur, Malaysia. In 1970, Mr. Liew received a Malaysian Certificate of Education from the Technical Institute in Penang, Malaysia. In 1972, Mr. Liew received a Higher School Certificate and University Entrance from Selwyn College in Auckland, New Zealand. In 1976, Mr. Liew received a Bachelor of Engineering (Electronics Engineering) Honors from University of Auckland, New Zealand.

 

Iain Bratt, Director

 

Iain Bratt has served as one of our directors since July 18, 2019, and also serves on our Audit Committee (as Chair), Compensation Committee, and Nominating and Corporate Governance Committee. Beginning in June 2020, Mr. Bratt was appointed the Executive Vice President and Chief Operating Officer of the Social Networking Association, a United States-based international non-profit organization, created to promote the usage of social media within the sales industry. Since August 2018, Mr. Bratt has served as Co-Founder and Chief Operating Officer of Social Point of View LLC (“SPV”) in Scottsdale, Arizona, a software based social media platform built to grow independent contractors’, small business’, brands’ and companies’ customer bases. From January 2016 to July 2018, Mr. Bratt was engaged as a freelance consultant, providing C-level expertise in the fields of operations and finance to direct sales and traditional businesses. From February 2015 to December 2015, Mr. Bratt served as the Chief Executive Officer for the United States, Canada, Mexico, and Brazil divisions of Lyoness Americas, Inc., an international shopping network in Miami, Florida, with 6 million members in over 40 countries and 27 languages, offering cashback and shopping points to members and marketing support to small business clients. From May 1999 to November 2014, Mr. Bratt served as the Executive Vice President and Chief Financial Officer of Doctor’s Signature Sales and Marketing International Corp., doing business as LifeForce International (“LifeForce”), a family owned nutritional products manufacturer and direct sales company located in Poway, California. Mr. Bratt presided over all of LifeForce’s operations, including revenue generation, recognition, and growth. Mr. Bratt was educated in the United Kingdom. He was a Member of the Association of Accounting Technicians (“AAT”) from 1984 to 1989 at West Bromwich College of Commerce & Technology England, which is the U.S. equivalent of a Bachelor of Science degree in accounting. Mr. Bratt obtained the designation of Fellow AAT in 1998, which is the U.S. equivalent of 150 hours of professional advancement in advanced accounting, in addition to five years of professional experience. We believe that Mr. Bratt is qualified to serve as one of our directors because of his extensive financial, accounting, and management experience.

    

 
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Jim Lupkin, Director

 

Jim Lupkin has served as one of our directors since July 18, 2019, and also serves on our Audit Committee, Compensation Committee (Chair), and Nominating and Corporate Governance Committee. In addition to serving as a member of our Board, since August 2018, Mr. Lupkin served as the Chief Executive Officer of SPV. SPV offers a software-based social media platform built to grow independent contractors’, small businesses’, brands’, and companies’ customer bases by using organic strategies across social media platforms. From August 2014 to July 2018, Mr. Lupkin was a consultant, providing social media training and advice on social media advertisement and coaching to independent contractors, small businesses, brands, and companies. From February 2016 to July 2016, Mr. Lupkin served as an executive officer of Yevo International LLC, in which role he was responsible for leading the social media initiatives for the company and its consultants across five countries. From January 2013 until August 2014, Mr. Lupkin was the Social Media Director of Zurvita Holdings, Inc. (“Zurvita”), a direct sales company that sells wellness products. Mr. Lupkin is a 25-year veteran of the social media industry. His book, Network Marketing for Facebook, is an Amazon bestseller. We believe that Mr. Lupkin is qualified to serve as one of our directors because of his extensive knowledge and background in social media, which we believe is beneficial with our continued development and marketing of our mobile application, the “Yippi App.”

   

Shemori BoShae Guinn, Director

 

Shemori BoShae Guinn has served as one of our directors since July 18, 2019, and also serves on our Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee (Chair). Ms. Guinn is an international business development consultant with more than twelve years of experience working with clients to expand their global reach and fulfill their business objectives. Ms. Guinn specializes in development of strategic partnerships, creating digital marketing campaigns, and organizing public relations events. From December 2016 to February 2019, she served as the Chief Experience Officer at 1ParkPlace, Inc., in which role she developed the client base for a new real estate technology. From April 2016 to December 2016, Ms. Guinn worked in corporate development, introducing potential strategic partnerships and creating presentations for The EMCO Hanover Group. From January 2014 to March 2016, Ms. Guinn curated content and created video on demand distribution channels as Vice President of Business Development for an international record label, DJ Central, based in Australia. From January 2013 to January 2014, she was an Executive Producer developing documentaries and producing promotional events for the Century City Film Fund. Ms. Guinn graduated with honors and obtained a Bachelor of Arts degree in Corporate Communication from the University of Central Oklahoma in 2008. We believe that Ms. Guinn is qualified to serve as one of our directors because we believe her extensive experience in marketing and business development will assist us with the continued business development and growth of both our social media and direct sales businesses.

 

Family Relationships

 

There are no family relationships among any of our directors or executive officers.

 

 
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Involvement in Certain Legal Proceedings

 

None of our directors and executive officers has been involved in any legal or regulatory proceedings, as set forth in Item 401 of Regulation S-K, during the past ten years.

 

Delinquent Section 16(a) Reports

 

Section 16(a) of the Exchange Act requires our directors, executive officers, and persons who beneficially own 10% or more of a class of securities registered under Section 12 of the Exchange Act to file reports of beneficial ownership and changes in beneficial ownership with the SEC. Directors, executive officers, and greater than 10% stockholders are required by the rules and regulations of the SEC to furnish us with copies of all reports filed by them in compliance with Section 16(a). We are required to disclose delinquent filings of reports by such persons.

 

Based solely on our review of certain reports filed with the SEC pursuant to Section 16(a) of the Exchange Act, we believe that all Section 16(a) filing requirements applicable to our executive officers, directors, and 10% or greater beneficial stockholders were met during the fiscal years ended July 31, 2019 and 2020, except as follows:

 

Delinquent Reports for Fiscal Year ended July 31, 2019

 

(i) Mr. Toh failed to report two transactions on time on two Form 4s; (ii) Mr. Tan failed to report two transactions on time on two Form 4s; (iii) Mr. Lim failed to report three transactions on time on three Form 4s; (iii) Mr. Ng failed to report five transactions on time on five Form 4s; (iv) Mr. Liew failed to report two transactions on time on two Form 4s; (vii) Mr. Henderson failed to report two transactions on time on two Form 4s; and (viii) Mr. Goh failed to file a Form 4 reflecting the disposition of 62,700 shares of our Common Stock on October 1, 2019.

 

In addition, we believe that Agel, who was a related party (as more fully set forth in “Related Party Transactions”) held approximately 10% of the Company for two weeks during the fiscal year ended July 31, 2019. Agel did not file any Section 16(a) reports during such time.

 

Delinquent Reports for Fiscal Year ended July 31, 2020

 

(i) Mr. Toh failed to report one transaction on time on a Form 4; (ii) Mr. Lim failed to report one transaction on time on a Form 4; (iii) Mr. Ng failed to report one transaction on time on a Form 4; (iv) Mr. Bratt failed to report four transactions on time on four Form 4s; (v) Ms. Guinn failed to report four transactions on time on four Form 4s; (vi) Mr. Lupkin failed to report four transactions on time on four Form 4s; (vii) Mr. Henderson failed to report five transactions on time on five Form 4s; and (viii) Mr. Goh failed to report two transactions on time on two Form 4s. Mr. Goh also failed to file three Form 4s reflecting the disposition of 2,310,340 shares of our Common Stock on December 9, 2019; the disposition of 3,456,190 shares of our Common Stock on January 2, 2020; and the disposition of 31,500 shares of our Common Stock on February 3, 2020.

 

Corporate Governance

 

Prior to June 2020, although we had an Audit Committee, we did not have a Compensation Committee or a Nominating and Corporate Governance Committee. In June 2020 we adopted a code of ethics and a complete set of corporate governance charters and formalized our committees.

 

 
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Code of Ethics

 

On June 10, 2020, our Board approved and adopted a Code of Ethics and Business Conduct for Directors, Senior Officers, and Employees (our “Code of Ethics”) that applies to all of our directors, officers and employees, as well as a Code of Ethics for Financial Officers, which supplements the Code of Ethics as it relates to the activities of our Chief Executive Officer, President, Chief Financial Officer, Treasurer, and Corporate Controller (our “Senior Financial Officer Code”). Our Code of Ethics and Senior Financial Officer Code address such individuals’ conduct with respect to, among other things, conflicts of interests; compliance with applicable laws, rules, and regulations; full, fair, accurate, timely, and understandable disclosure by us; competition and fair dealing; corporate opportunities; confidentiality; protection and proper use of our assets; and reporting suspected illegal or unethical behavior. Our Code of Ethics and Senior Financial Officer Code are available on our website at https://togalimited.com/corporate-governance/.

 

Audit Committee and Audit Committee Financial Expert

 

On June 10, 2020, our Board amended and restated the charter (the “Audit Committee Charter”) to govern the Audit Committee (our “Audit Committee”). Currently, Mr. Bratt (Chair), Ms. Guinn, and Mr. Lupkin serve as members of our Audit Committee and our Board has determined that each meets the independence requirements of The New York Stock Exchange (“NYSE”) and the SEC. Our Board has also determined that Mr. Bratt qualifies as an “audit committee financial expert.” The Audit Committee’s responsibilities include, among others, engaging and terminating our independent registered public accounting firm, oversight of the independent registered public accounting firm, and determining the compensation for their engagement(s). Our Audit Committee met twice, including telephonic meetings, during fiscal 2020. All three members attended 100% of the Audit Committee meetings following their respective appointments. The independent directors joined the Company in July 2019.  The Audit Committee was established shortly thereafter and reviewed the Company’s 10K and Audit prior to its annual filing. The Audit Committee Charter can be found online at https://togalimited.com/corporate-governance/.

 

Compensation Committee

 

Subsequent to the end of fiscal 2019, on June 10, 2020, our Board formally established the Compensation Committee (our “Compensation Committee”) and approved and adopted a charter (the “Compensation Committee Charter”) to govern our Compensation Committee. Currently, Mr. Lupkin (Chair), Ms. Guinn, and Mr. Bratt serve as members of our Compensation Committee and our Board has determined that each meets the independence requirements of the NYSE and the SEC, qualifies as a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act, and qualifies as an outside director within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”). The Compensation Committee’s responsibilities include overseeing the compensation of our executives, producing an annual report on executive compensation for inclusion in our proxy statement, if and when required by applicable laws or regulations, and advising our Board on the adoption of policies that govern our compensation programs. Our Compensation Committee did not meet during fiscal 2020. The Compensation Committee Charter may be found online at https://togalimited.com/corporate-governance/.

 

Nominating and Corporate Governance Committee

 

Subsequent to the end of fiscal 2019, on June 10, 2020, our Board formally established the Nominating and Corporate Governance Committee (the “Nominating Committee”) and approved and adopted a charter (the “Nominating Committee Charter”) to govern our Nominating Committee. Currently, Ms. Guinn (Chair), Mr. Lupkin, and Mr. Bratt serve as members of our Nominating Committee and our Board has determined that each meets the independence requirements of the NYSE and the SEC. The Nominating Committee carries out the responsibilities delegated by our Board relating to our director nominations process and procedures, and developing, maintaining, and monitoring compliance with our corporate governance policies, guidelines, and activities. Our Nominating Committee did not meet during fiscal 2020. The Nominating Committee Charter may be found online https://togalimited.com/corporate-governance/.

 

 
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Orientation and Continuing Education

 

We have an informal process to orient and educate new directors to our Board regarding their role on our Board, our committees and our directors, as well as the nature and operations of our business. This process provides for an orientation with key members of the management staff, and further provides access to materials necessary to inform them of the information required to carry out their responsibilities as a member of our Board.

 

Our Board provides limited continuing education for its directors; however, each director is responsible for maintaining the skills and knowledge necessary to meet his or her obligations as a director.

 

Nomination of Directors

 

Effective July 14, 2020, we adopted the Amended and Restated Bylaws (our “Bylaws”), which provide, among other things, an advance notice requirement for director nominations by stockholders. In accordance with our Bylaws, a stockholder may nominate a director is as follows: (i) in the case of the nomination of a director for election at an annual meeting, by delivery of a notice to our Secretary not less than 90 days nor more than 120 days prior to the first anniversary of the preceding year’s annual meeting (provided, however, that if the annual meeting date is more than 30 days before or more than 70 days after anniversary date of the prior year’s annual meeting or the 10th day following the day on which the public announcement of the meeting date is first made by us); or (ii) in the case of the nomination of a director for election at a special meeting, by delivery of a notice to our Secretary not earlier than 120 days prior to such special meeting and not later than 90 days prior to such special meeting, or the 10th day following the day on which a public announcement is first made of the date of the special meeting and of the nominees proposed by our Board to be elected at such meeting.

 

If a stockholder wishes to nominate a director for election at the 2021 annual stockholders’ meeting the stockholder must give advance notice to us prior to the deadline for such meeting determined in accordance with our Bylaws. Our Bylaws require, among other things, that our Secretary receive written notice from the stockholder of record of his, her, or its intent to present such nomination not earlier than the close of business on the 120th day and not later than the close of business on the 90th day prior to the anniversary of the preceding year’s annual meeting or the 10th day following the day on which public announcement of the date of such meeting is first made by us, which we consider a reasonable time for such submission before we begin printing and delivering our proxy materials for the next annual meeting. We did not hold an annual stockholders’ meeting in fiscal 2020 and have not yet set a date for our 2021 stockholders’ meeting. When we set this meeting date, we intend to publicly announce the meeting date and the corresponding deadline. All nominations must comply with our Bylaws.

 

We may request from the recommending stockholder or recommending stockholder group such other information as may reasonably be required to determine whether each person recommended by a stockholder or stockholder group as a nominee meets the minimum director qualifications established by our Board and is independent based on applicable laws and regulations. The Nominating Committee may also establish procedures, from time to time, regarding submission of candidates by stockholders and others.

 

We reserve the right to reject, rule out of order, or take other appropriate action with respect to any proposal that does not comply with these or other applicable requirements.

 

 
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Other Board Committees

 

Our Audit Committee, Compensation Committee, and Nominating Committee are currently the only committees of our Board.

 

Assessments

 

Our Board intends that individual director assessments be conducted by other directors, taking into account each director’s contributions at Board meetings, service on committees, experience base, and their general ability to contribute to one or more of our major needs. However, due to our stage of development and our need to deal with other urgent priorities, our Board has not yet implemented such a process of assessment.

 

Item 11. Executive Compensation

 

Summary Compensation Table

 

The following table sets forth certain compensation awarded to, earned by, or paid to the following “named executive officers,” which is defined as follows:

 

 

(a)

all individuals serving as our principal executive officer during the year ended July 31, 2019; and

 

 

 

 

(b)

each of our two other most highly compensated executive officers who were serving as executive officers at the end of the year ended July 31, 2019.

 

We did not have any individuals for whom disclosure would have been required but for the fact that the individual was not serving as an executive officer as of the fiscal year ended July 31, 2019.

 

The amounts disclosed below have been presented in U.S. dollars by converting the amounts from Malaysian Ringgit at the exchange rate as of July 31, 2018 and 2019.

 

Name and Position

 

Fiscal Year

 

Salary ($)

 

 

Bonus ($)

 

 

Stock Awards ($) (1)

 

 

Option Awards ($) (2)

 

 

Non-Equity Incentive Plan Compensation

($)

 

 

All Other Compensation ($)

 

 

Total ($)

 

Michael Toh Kok Soon

 

2018

 

 

239,331

 

 

 

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

239,331

 

Chairman of our Board, Chief Executive Officer

 

2019

 

 

415,000

 

 

 

 

 

 

1,033,899

 

 

 

 

 

 

 

-

 

 

 

 

 

 

1,448,985

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alex Henderson

 

2018

 

 

-

 

 

 

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

-

 

 

 

-

 

Chief Financial Officer, Secretary, Treasurer, and a Director

 

2019

 

 

66,000

 

 

 

 

 

 

 

 

 

 

1,061,017

 

 

 

-

 

 

 

-

 

 

 

172,102

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Steve Tan See Kuy

 

2018

 

 

34,846

 

 

 

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

34,846

 

Group General Manager and a Director

 

2019

 

 

58,104

 

 

 

5,246

 

 

 

2,495,337

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,558,687

 

_________

(1)

For valuation purposes, the dollar amount shown is calculated based on the grant date fair value computed in accordance with FASB ASC Topic 718. The number of shares granted, the grant date, and the market price of such shares are set forth below.

(2)

For valuation assumptions on stock option awards, refer to Note 6 to the audited consolidated financial statements for the year ended July 31, 2019. The disclosed amount reflects the fair value of the stock option awards that were earned during fiscal 2019 in accordance with FASB ASC Topic 718.

 

Narrative Disclosure to Summary Compensation Table

 

 
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Michael Toh Kok Soon

 

During the fiscal year ended July 31, 2019, we paid a base salary of approximately $415,000 to Michael Toh Kok Soon, our Chairman, Chief Executive Officer, and President. During the fiscal year ended July 31, 2018, we paid a base salary of $239,331 to Mr. Toh.

   

We issued the following stock-based compensation to Mr. Toh during fiscal 2019:

 

Grant Date

 

Number of

Shares of our Common Stock

 

 

Price Per

Share

 

 

Aggregate

Value

 

February 22, 2019

 

 

63,051

 

 

$ 9.00

 

 

$ 567,459

 

May 28, 2019

 

 

50,700

 

 

$ 9.20

 

 

$ 466,440

 

 

We did not issue any stock-based compensation to Mr. Toh during fiscal 2018.

 

Alexander D. Henderson

 

Employment Agreements

 

On February 8, 2019, the start date of Alexander Henderson’s employment with us, we entered into an Executive Agreement with Mr. Henderson (the “Original Agreement”), setting out his monthly base salary of $10,000 per month, plus the issuance of options to purchase up to 60,000 shares of our Common Stock, on a cashless basis, at an exercise price of $0.20 per share. One-third of shares of our Common Stock underlying the options vested every thirty days, and all of the options were set to expire on the second anniversary of the date of the Original Agreement. The initial term of the Original Agreement was three months.

 

On May 1, 2019, we entered into an Amended and Restated Executive Agreement (the “Second Agreement”), which amended and restated the Original Agreement in its entirety to extend the term of Mr. Henderson’s employment until April 30, 2020. Pursuant to the Second Agreement, Mr. Henderson’s monthly base salary was increased to $12,000, and Mr. Henderson provided that every 90 days, we would grant Mr. Henderson options to purchase up to an additional 60,000 shares of our Common Stock, with one-third of the options vesting every thirty days. All of the options were set to expire on the second anniversary of the date of the Second Agreement.

 

On August 1, 2019, we entered into a new Executive Agreement with Mr. Henderson (the “Third Agreement”). The Third Agreement provided for an employment term until July 31, 2020 and increased Mr. Henderson’s monthly basis salary to $15,000 per month. Pursuant to the Third Agreement, we granted to Mr. Henderson, on a quarterly basis during the term of the Third Agreement, options to purchase up to 60,000 shares of our Common Stock on a cashless basis, at an exercise price of $0.20 per share. One-third of the shares of our Common Stock underlying the options vested every thirty days, and all of the options were set to expire on the second anniversary of the date of the Third Agreement.

 

On August 1, 2020, we entered into a new Employment Agreement with Mr. Henderson (the “Fourth Agreement”). The Fourth Agreement extended the term of Mr. Henderson’s employment through July 31, 2022, with an automatic renewal on the same terms and conditions for successive one-year terms. The Fourth Agreement provides for a monthly base salary of $15,000 per month and for the quarterly grant of options to purchase up to 60,000 shares of our Common Stock on a cashless basis, at an exercise price of $0.20 per share, until such time as we adopted the Plan. The Plan was approved by our stockholders on September 9, 2020. Following such date, Mr. Henderson will be eligible to receive equity awards pursuant to the Plan as determined by the Compensation Committee, in its discretion. In the event of termination without cause or resignation for good reason, certain severance benefits will be paid to Mr. Henderson, including: a lump sum payment in an amount equal to his salary for the remainder of his service term (or six months, whichever is longer); a grant of equity awards, vested immediately, with a value approximately equivalent to the lump sum paid in the prior clause; and accelerated vesting of any equity awards previously granted in accordance with the Plan. Mr. Henderson’s employment agreement also contains certain restrictive covenants that prohibit him from disclosing information that is confidential to us and our subsidiaries.

 

 
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Compensation

 

During the fiscal year ended July 31, 2019, we paid a base salary of $66,000 to Alexander D. Henderson, our Chief Financial Officer, Secretary, Treasurer, and a Director. Mr. Henderson’s employment commenced in February 2019; thus, we did not pay Mr. Henderson any compensation during fiscal 2018.

  

During the year ended July 31, 2019, we granted Mr. Henderson options to purchase up to 120,000 shares of our Common Stock at an exercise price of either $0.20 or $0.40 per share. The options were issued quarterly and were subject to a vesting schedule of one-third of the options vesting every 30 days. The value of the options was $1,061,017 based on the Black-Scholes-Merton model. These options were subsequently subject to 10:1 reverse stock split approved and adopted by our Board on April 24, 2019; thus, following the reverse stock split, the options became exercisable for up to 12,000 shares of our Common Stock.

   

During the year ended July 31, 2020, we granted Mr. Henderson options to purchase up to 6,792 shares of our Common Stock at an exercise price of $0.20 per share. The options were granted over the first and second quarters, with one-third of the options vesting every 30 days. The value of the options was $88,059 based on the Black-Scholes-Merton model.

 

On March 25, 2020, we redeemed stock options to purchase up to 18,792 shares of our Common Stock from Mr. Henderson (representing a portion of the stock options previously granted to Mr. Henderson in the years ending July 31, 2019 and 2020), for an aggregate purchase price of $156,537.

 

After this redemption, and during the year ended July 31, 2020, we granted Mr. Henderson options to purchase up to 12,461 shares of our Common Stock at an exercise price of $0.20 per share. The aggregate value of the options was $134,855 based on the Black-Scholes-Merton model.

 

Steve Tan See Kuy

 

During the fiscal year ended July 31, 2019, we paid base salary of $58,104 and a cash bonus of $5,246 to Steve Tan See Kuy, our Group General Manager. During the fiscal year ended July 31, 2018, the Company paid a salary of $34,846 to Mr. Tan.

 

During the fiscal year ended July 31, 2019, we issued an aggregate of 275,593 shares of our Common Stock as stock-based compensation valued at $2,495,337 (we issued 200,593 shares of our Common Stock on February 22, 2019, when the price per share was $9.00 as reported by the OTCM on the grant date, and we issued 75,000 shares on May 28, 2019, when the price per share was $9.20 as reported by the OTCM on the grant date).

 

Employment Agreements

 

Other than the Fourth Agreement as described above under the section titled “Alexander D. Henderson – Employment Agreements,” we are not a party to any employment agreements.

 

 
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Outstanding Equity Awards at Fiscal Year-End

 

Except as disclosed below did not have any option awards or stock awards outstanding as of July 31, 2019.

 

 

 

Option Awards

 

(a)

Name

 

(b)

Number of Securities Underlying Unexercised Options (#) Exercisable

 

 

(c)

Number of Securities Underlying Unexercised Options (#) Unexercisable

 

 

(e)

Option Exercise Price ($)

 

 

Vesting Schedule

 

(f)

Option Expiration Date

 

Alexander Henderson (1)

 

 

8,729

 

 

 

0

 

 

 

0.20

 

 

1/3 every 30 days

 

August 1, 2021

 

 

 

 

3,732

 

 

 

0

 

 

 

0.20

 

 

1/3 ever 30 days

 

August 1, 2021

 

 

Retirement or Similar Benefit Plans

 

There are no arrangements or plans in which we provide retirement or similar benefits for our directors or executive officers.

 

Resignation, Retirement, Other Termination, or Change in Control Arrangements

 

Other than the Fourth Agreement with Mr. Henderson, we do not have any contracts, agreements, plans, or arrangements, whether written or unwritten, that provides for payments to our directors or executive officers at, following, or in connection with the resignation, retirement, or other termination of our directors or executive officers, or a change in control of our company or a change in our directors’ or executive officers’ responsibilities following a change in control.

    

Director Summary Compensation Table

  

Because our “independent” members of the Board (as such term is defined by Nasdaq) were appointed on July 18, 2019, the table below summarizes the compensation paid to (or will be paid per the agreements) to both our prior directors, who were also employees, as well as our non-employee directors, for the fiscal year ended July 31, 2019:

 

Name (5)

 

Salary ($)

 

 

Bonus ($)

 

 

Stock awards ($) (1)

 

 

Option awards ($) (2)

 

 

Non-equity incentive plan compensation ($)

 

 

Nonqualified deferred compensation earnings ($)

 

 

All other compensation ($)

 

 

Total ($)

 

Roy Lim Jun Hao (3)

 

 

 

 

 

 

 

 

174,124

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

174,124

 

Edward Ng Boon Chee (3)

 

 

115,421

 

 

 

10,350

 

 

 

863,978

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

989,749

 

William Liew Choon Fook (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shemori BoShae Guinn (4)

 

 

4,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,000

 

Iain Bratt (4)

 

 

4,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,000

 

Jim Lupkin (4)

 

 

4,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,000

 

______________

(1)

For valuation purposes, the dollar amount shown is calculated based on the grant date fair value computed in accordance with FASB ASC Topic 718. The number of shares granted, the grant date, and the market price of such shares are set forth below.

 

 
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(2)

For valuation assumptions on stock option awards, refer to Note 6 to the audited consolidated financial statements for the year ended July 31, 2019. The disclosed amount reflects the fair value of the stock option awards that were earned during fiscal 2019 in accordance with FASB ASC Topic 718.

 

 

(3)

M ssrs. Lim, Ng and Liew resigned as members of our Board on July 18, 2019.

 

 

(4)

Our Independent Directors, Ms. Guinn Messrs. Bratt and Lupkin became members of our Board on July 18, 2019.

 

 

(5)

Mr. Steve Tan See Kuy served as a director until July 18, 2019. Messrs. Michael Toh Koh Soon and Alexander Henderson are current directors. Messrs . Tan, Toh, and Henderson are also named executive officers for the year ended July 31, 2019. Accordingly, all of the compensation paid by us to each named executive officer is reflected in the Summary Compensation Table above.

 

Narrative Discussion on Director Compensation

 

Prior to the engagement of our current Independent Directors, the following directors served on our Board: Steve Tan See Kuy, Roy Lim Jun Hao, Edward Ng Boon Chee and William Liew Choon Fook. For the fiscal year ending July 31, 2019, we did not pay any cash fees to our then-current directors, nor did we pay directors’ expenses for attending board meetings. The compensation paid to former employee directors in their roles as executive officers (Steve Tan See Kuy, Roy Lim Jun Hao, Edward Ng Boon Chee and William Liew Choon Fook (Mr. Liew is no longer one of our employees)) is set forth above in the Director Summary Compensation Table.

 

Roy Lim Jun Hao

 

During the fiscal year ended July 31, 2019, we paid no cash compensation to Mr. Lim, and issued an aggregate of 19,240 shares of our Common Stock as stock-based compensation valued at $174,124 (we issued 14,421 shares of our Common Stock on February 22, 2019, when the price per share was $9.00, as reported by the OTCM on the grant date, and we issued 4,819 shares on May 28, 2019, when the price per share was $9.20, as reported by the OTCM on the grant date).

 

Edward Ng Boon Chee

 

During the fiscal year ended July 31, 2019, we paid a base salary of approximately $105,453 and a cash bonus of approximately $4,847 to Edward Ng Boon Chee.

 

On February 22, 2019, we issued 56,552 shares of our Common Stock as stock-based compensation valued at $508,968, based on a per-share price of $9.00 as reported by the OTCM on the grant date. On May 28, 2019, we issued 38,588 shares of our Common Stock as stock-based compensation valued at $355,010, based on a per-share price of $9.20 as reported by the OTCM on the grant date.

 

William Liew Choon Fook

 

During the fiscal year ended July 31, 2019, we paid wages of $252 to Mr. Liew, and issued 3,623 shares of our Common Stock as stock-based compensation valued at $32,909.00 (we issued 2,113 shares of our Common Stock on February 22, 2019, when the price per share was $9.00, as reported by the OTCM on the grant date, and we issued 1,510 shares on May 28, 2019, when the price per share was $9.20, as reported by the OTCM on the grant date).

 

 
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Iain Bratt; Jim Lupkin; Shemori BoShae Guinn

 

Before Iain Bratt, Jim Lupkin, and Shemori BoShae Guinn, the independent members of our Board, officially became members of our Board, we paid each an introductory cash appearance fee of $4,000 on June 21, 2019. On August 1, 2019, we agreed to provide to each independent director: (a) cash compensation in the amount of $3,000 per fiscal quarter, with anyone serving as chairperson of any of the Board Committees receiving an additional $1,000 per quarter; and (b) at the end of each fiscal quarter, such number of shares of our Common Stock that have a market value of $1,500 determined by using the average closing bid price of our Common Stock during each trading day of the last thirty (30) trading day period immediately preceding the end of the applicable fiscal quarter.

 

Pursuant to our agreements with the independent directors, we issued to each of them:

 

 

·

105 shares of our Common Stock for the quarter ended October 31, 2019 (at $14.28 per share);

 

 

 

 

·

113 shares of our Common Stock for the quarter ended January 31, 2020 (at $13.35 per share);

 

 

 

 

·

280 shares of our Common Stock for the quarter ended April 30, 2020 (at $5.35 per share); and

 

 

 

 

·

127 shares of our Common Stock for the quarter ended July 31, 2020 (at $11.81 per share).

 

We also paid consulting fees of $15,000 to Ms. Guinn for marketing research services during October, November and December 2019.

 

We paid fees of approximately $24,000 to SPV for advertising, promotion and referral services.to SPV Since August 2019, Mr. Bratt served as Co-Founder and Chief Operating Officer of SPV, and  Mr. Lupkin served as Chief Executive Officer of SPV.

 

On January 1, 2020, we entered into a Service Agreement (the “SNA Service Agreement”) with Social Networking Association (“SNA”), whereby SNA agreed to present ten-minute multi-media presentations about us to 1,000 individuals over a period of 90 days. We agreed to pay SNA an aggregate of $30,000 in three installments of $10,000 payable on January 1, February 1, and March 1, 2020. SNA is directed by Jim Lupkin, a member of our Board. Mr. Lupkin was in charge of performing services on behalf of SNA under the SNA Service Agreement. Beginning in June 2020, Mr. Bratt, another member of our Board, was appointed the Executive Vice President and Chief Operating Officer of SNA.

 

Beginning in fiscal 2021, we will increase the cash compensation for the Independent Directors to $6,000 on a quarterly basis (the quarterly stock compensation will remain the same).

 

Risk Assessment in Compensation Programs

 

During fiscal 2019, we paid compensation to our employees, including executive and non-executive officers. Due to the size and scope of our business, and the amount of compensation, we did not have any employee compensation policies and programs to determine whether our policies and programs create risks that are reasonably likely to have a material adverse effect on us.

 

Item 12. Security Ownership of Certain Beneficial Owners and Management

  

The following table sets forth, as of January 28, 2021, certain information with respect to the beneficial ownership of shares of our Common Stock by (i) each of our directors (including director nominees), (ii) each of our named executive officers, (iii) our directors and executive officers as a group, and (iv) each stockholder known by us to be the beneficial owner of more than 5% of our outstanding Common Stock.

   

 
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Name and Address

 

Title of Class

 

Amount and Nature of Beneficial Ownership(1)

 

 

Percent Owned (%)(2)

 

Michael Toh Kok Soon

c/o Toga Limited, 515 S. Flower Street

18th Floor, Los Angeles, CA 90071

 

Common Stock

 

 

24,227,546

 

 

 

26.62 %

 

 

 

 

 

 

 

 

 

 

 

Alexander Henderson

c/o Toga Limited, 515 S. Flower Street

18th Floor, Los Angeles, CA 90071

 

Common Stock

 

 

0

 

 

*

 

 

 

 

 

 

 

 

 

 

 

 

Iain Bratt

c/o Toga Limited, 515 S. Flower Street

18th Floor, Los Angeles, CA 90071

 

Common Stock

 

 

774

 

 

*

 

 

 

 

 

 

 

 

 

 

 

 

Jim Lupkin

c/o Toga Limited, 515 S. Flower Street

18th Floor, Los Angeles, CA 90071

 

Common Stock

 

 

774

 

 

*

 

 

 

 

 

 

 

 

 

 

 

 

Shemori BoShae Guinn

c/o Toga Limited, 515 S. Flower Street

18th Floor, Los Angeles, CA 90071

 

Common Stock

 

 

774

 

 

*

 

 

 

 

 

 

 

 

 

 

 

 

Edward Ng Boon Chee

c/o Toga Limited, 515 S. Flower Street

18th Floor, Los Angeles, CA 90071

 

Common Stock

 

 

691,068

 

 

*

 

 

 

 

 

 

 

 

 

 

 

 

All executive officers and directors as a group (8 persons) (3) (4)

 

Common Stock

 

 

30,214,199

 

 

 

33.19 %

 

 

 

 

 

 

 

 

 

 

 

___________

* Represents less than 1%.

 

(1)

Except as otherwise indicated, we believe that the beneficial owners of the shares of our Common Stock listed above, based on information furnished by such owners, have sole investment and voting power with respect to such shares subject to community property laws, where applicable. Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Shares of our Common Stock subject to options or warrants currently exercisable or exercisable within 60 days are deemed outstanding for purposes of computing the percentage ownership of the person holding such option or warrants, but are not deemed outstanding for purposes of computing the percentage ownership of any other person.

 

 

(2)

Percentage of Common Stock is based on 91,013,640 shares of our Common Stock being issued and outstanding as of January 18, 2021.

 

 

(3)

Includes Steve Tan See Kuy and Roy Lim Jun Hau, as well as the other listed directors and named executive officers. It does not include Williem Liew Choon Fook, who resigned as corporate secretary and director on July 18, 2019.

 

 

(4)

This beneficial ownership table is current as of January 28, 2021.

 

 
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Change-in-Control Arrangements

 

We do not know of any arrangements, which may, at a subsequent date, result in a change-in-control.

 

Item 13. Certain Relationships and Related Transactions, and Director Independence.

 

Related Party Transactions

 

We follow ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions. When and if we contemplate entering into a transaction in which any executive officer, director, nominee, or any family member of the foregoing would have a direct or indirect interest, regardless of the amount involved, the terms of such transaction are to be presented to our full Board (other than any interested director) for approval, and documented in the Board minutes.

 

Other than as disclosed below, we have had no related party transactions since the beginning of August 1, 2019. For the sake of clarity, we have also included certain related party transactions from 2017 to August 1, 2019.

 

Agreements with our Founders, Early Stockholders and Executive Officers

 

On October 1, 2018, we entered into a subscription agreement with Edward Ng Boon Chee, whereby Mr. Ng (a member of our Board from June 14, 2018 to July 18, 2019, and the Chief Operating Officer of TOGL Technology since April 2018) agreed to purchase 286,095 shares of our Common Stock at a subscription price of $7.50 per share, for an aggregate purchase price of $2,145,716, which was paid for in 330 Bitcoins. The agreed per-share purchase price was slightly greater than the market per-share price measured on the day before closing as reported by the OTCM (which was $7.20 on September 28, 2018).

 

Agreements with Toga Capital

 

Until the beginning of 2018, Messrs. Toh, Lim, and Goh, controlling stockholders of ours, were also the controlling stockholders of Toga Capital, and such controlling stockholders also held director and executive officer positions in both entities during that time). Messrs. Toh, Lim, and Goh owned Toga Capital from February 17, 2015 to February 26, 2018, when they sold 100% of their ownership to an unaffiliated third-party. Mr. Toh, our Chief Executive Officer, President, and director, served as a director and officer of Toga Capital from February 17, 2015 until February 26, 2018. Mr. Lim, our former director and the current Deputy Executive Officer of TOGL Technology, served as a director and officer of Toga Capital from February 17, 2015 until April 18, 2018. Except for these overlaps, we have not had any direct or indirect control over, or have been controlled by, Toga Capital in more than two years.

 

In 2017, we contemplated acquiring Toga Capital and during such period, we were advanced expenses by, used the services of certain employees of, and shared office space with Toga Capital. When it became clear that the acquisition would not be completed, the funds advanced by Toga Capital were accounted for as outstanding debt obligation to Toga Capital on our books.

 

On October 31, 2017, after abandoning the potential acquisition, we entered into a subscription agreement with Toga Capital (the “Toga Capital Subscription Agreement”). Pursuant to the Toga Capital Subscription Agreement, we offered Toga Capital the option to purchase up to 120,000,000 shares of our Common Stock, which would represent up to 12% of our then-authorized shares, at a purchase price of $0.10 per share (for an aggregate purchase price of $12 million), at any time prior to August 31, 2020. Funds provided to us pursuant to this private placement were to be used for our general operating expenses. The shares were to be issued to Toga Capital as payment was received. Because of the overlap between management of both entities at the time the Toga Capital Subscription Agreement was entered into, it was treated as a related party transaction.

 

 
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Between November 2017 and August 2018, Toga Capital acquired an aggregate of 12,324,758 shares of our Common Stock pursuant to the Toga Capital Subscription Agreement at a purchase price of $0.10 per share, of which 6,324,758 shares were issued for the cancellation of $632,475 of debt, and 6,000,000 shares were issued for $600,000 of cash. Toga Capital did not remit the balance of the remaining $10,767,907, and we did not issue the balance of the 107,675,242 shares of our Common Stock potentially purchasable under the Toga Capital Subscription Agreement. No sales under the Toga Capital Subscription Agreement have occurred since August 2018.

 

Toga Capital was in the business of engaging agents to sell certain products through direct marketing efforts. Between January 2018 and August 2018, Toga Capital transferred 12,324,486 shares of our Common Stock to its agents, leaving Toga Capital with a balance of 272 shares. The agents received the shares of our Common Stock in lieu of commission fees for services provided to Toga Capital at a price of $0.10 per share. On July 10, 2019, two stockholders transferred 290,000 shares back to Toga Capital to correct prior errors. Subsequently, on August 22, 2019, Toga Capital transferred its entire remaining balance of 290,272 shares to Agel; thus, Toga Capital currently holds no shares of our Common Stock.

 

Toga Capital and we mutually agreed to terminate the Toga Capital Subscription Agreement, effective May 31, 2020. Subsequent to May 31, 2020, we believe that Toga Capital is no longer deemed to be a related party.

 

Agreements with Agel

 

On May 7, 2018, we entered into a subscription agreement with Agel, pursuant to which we offered Agel the option to purchase up to 107,675,242 shares of our Common Stock at a subscription price of $0.20 per share for an aggregate purchase price of $21,535,048, which subscription agreement was amended and restated in its entirety on March 18, 2019 so that the subscription price per share was adjusted to the “Market Price” (defined as the five-day closing bid price of our Common Stock as reported by the OTCM) (as amended and restated, the “Agel Subscription Agreement”). Funds provided to us pursuant to this private placement were to be used for our general operating expenses. The shares were to be issued to Agel as payment was received.

 

In July 2018, Agel entered into an Assignment and Assumption Agreement with Toga Capital, whereby Agel, which was also in the business of engaging agents to sell certain of our products through direct marketing efforts, agreed to assume Toga Capital’s obligations with respect to allowing agents in a direct marketing network to receive the shares of our Common Stock, in lieu of commission fees for services provided to Toga Capital, at a price of $0.10 per share.

 

Agel purchased an aggregate of 21,639,713 shares of our Common Stock pursuant to the Agel Subscription Agreement for an aggregate amount of $5,302,000 as follows:

 

 

·

As memorialized in the subscription agreement between Agel and us dated May 7, 2018, between March 23, 2018 and March 18, 2019, Agel purchased 12,846,812 shares of our Common Stock for an aggregate of $2,569,358 in cash at a purchase price of $0.20 per share;

 

 

 

 

·

Between December 26, 2018 and February 22, 2019, Agel purchased 8,686,113 shares of our Common Stock for an aggregate of $1,737,142 in Bitcoins at a purchase price of $0.20 per share;

 

 
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·

On March 18, 2019, Agel purchased 11,072 shares of our Common Stock for $97,436 in Bitcoins at a purchase price of $8.80 per share;

 

 

 

 

·

On May 9, 2019, Agel purchased 88,194 shares of our Common Stock for $829,025 in Bitcoins at a purchase price of $9.40 per share; and

 

 

 

 

·

On July 24, 2019, Agel purchased 7,521 shares of our Common Stock for $69,039 in Bitcoins at a purchase price of $9.179 per share.

 

The shares of our Common Stock acquired on or after March 18, 2019 were acquired at a purchase price per share equal to the Market Price of our Common Stock on the date of purchase. No sales under the Agel Subscription Agreement have occurred since July 2019. However, on August 22, 2019, Agel received 290,272 shares from Toga Capital.

 

Agel was in the business of engaging agents to sell certain of our products through direct marketing efforts. Between August 2018 and August 2019, Agel transferred 21,642,932 shares of our Common Stock that it purchased to its agents. The agents received the shares of our Common Stock in lieu of commission fees for services provided to Agel at a price ranging between $0.10 and $0.30 per share. As of August 17, 2020, Agel holds a balance of 287,053 shares of our Common Stock.

 

Agel and we mutually agreed to terminate the Agel Subscription Agreement effective May 31, 2020.

 

Our wholly-owned subsidiary, TOGL Technology, entered into a General Service Agreement with Agel dated January 1, 2018, which was amended on March 31, 2018 (as amended, the “Agel Service Agreement”), whereby TOGL Technology agreed to provide certain information technology, graphic design, management consulting, and accounting and financial services to Agel in exchange for a monthly service fee based on a percentage of Agel’s monthly gross income derived from services provided by TOGL Technology. The Agel Service Agreement was terminated by mutual agreement on April 30, 2019.

 

On April 1, 2018, we entered into the Agel License Agreement with Agel, which was subsequently amended on August 1, 2019, which allows Agel to use the “Yippi” and “Eostre” trademarks for marketing purposes. As set forth in the Agel License Agreement, we granted Agel a non-exclusive, non-sublicensable, non-transferable license to reproduce and display the trademarks for certain promotional activities, merchandise, and events. As consideration for the license, Agel paid us a monthly fee in the amount of $20,000.

 

On May 1, 2019, TOGL Technology entered into the Yipps Agreement with Agel for the purchase and distribution of Yipps, points that can be used by the Yippi App users located in Malaysia.

 

Because of the Agel Subscription Agreement, the Agel Service Agreements, the Agel License Agreement, and the Agel Yipps Agreement entered into between the two entities, the two entities were deemed related party transactions.

 

During the year ended July 31, 2019, in connection with the Agel Service Agreement, the Agel License Agreement, and the Agel Yipps Agreement, TOGL Technology generated advertising revenue of approximately $0.2 million, information technology fee revenue of approximately $0.1 million, and management fee revenue from Agel of approximately $1.1 million. During the year ended July 31, 2019, the U.S.A. segment recognized management fee revenue of approximately $0.2 million from Agel. During the year ended July 31, 2018, TOGL Technology generated advertising revenue of approximately $0.1 million and management fee revenue of approximately $0.5 million from Agel Enterprises.

   

 
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On May 31, 2020, we terminated the Agel License Agreement. Also, on May 31, 2020, Agel and we terminated the Agel Yipps Agreement. Subsequent to May 31, 2020, we believe that Agel is no longer deemed to be a related party.

 

Agreements with Tinnolab

 

On March 1, 2018, our wholly owned subsidiary, TOGL Technology, entered into a Yippi Mobile App Outsource Service & Maintenance Level Agreement with Tinnolab Sdn. Bhd. (“Tinnolab”), for development and information technology support in connection with the Yippi App on various mobile platforms, in exchange for payment of hourly fees of RM80.00 per hour (approximately $19 USD) invoiced monthly in connection with the work provided (the “Tinnolab Service Agreement”). The Tinnolab Service Agreement commenced on March 1, 2018, and automatically renewed for additional twelve-month terms until terminated. The Tinnolab Service Agreement was terminated on July 31, 2019.

 

From its founding on March 22, 2017 through September 12, 2018, Tinnolab was owned 50% by Toga Capital and 50% by Kayden Ong Swee Sin (“Mr. Ong”). During 2018, we paid Tinnolab 139,496.00MYR (approximately $33,479.00 USD), in connection with Tinnolab’s services. On September 12, 2018, Toga Capital transferred its 50% ownership in Tinnolab to TOGL Technology. On April 8, 2019, TOGL Technology transferred its 50% ownership in Tinnolab to Mr. Ong, leaving Mr. Ong with 100% of the ownership of Tinnolab from that date to the present. In connection with the Tinnolab Service Agreement, we paid Tinnolab 909,014.00MYR (approximately $218,163.00 USD) during 2019. We also paid Tinnolab 5,448.40MYR (approximately $1,307.00 USD) during 2020 in connection with improvements to the Yippi App and our website. In May 2019, Mr. Ong became an employee of ours, first as the Business Development Manager (from May 2019 to July 2019), then as the Corporate Development Officer (from August 2019 to January 2020), and currently as TOGL Technology’s Chief Corporate & Compliance Officer, since February 2020. Certain of our other employees also served as directors of Tinnolab from March 22, 2017 until their resignation on December 24, 2019.

 

Because of the overlap employees between us, our subsidiaries, and Tinnolab, the Tinnolab Service Agreement entered into between the two entities these are considered a related party transaction.

 

Agreements with Directors

 

We also paid consulting fees of $15,000 to Ms. Guinn for marketing research services during October, November and December 2019.

 

We paid fees of approximately $24,000 to SPV for advertising, promotion and referral services.to SPV Since August 2019, Mr. Bratt served as Co-Founder and Chief Operating Officer of SPV, and  Mr. Lupkin served as Chief Executive Officer of SPV.

 

On January 1, 2020, we entered into a Service Agreement (the “SNA Service Agreement”) with Social Networking Association (“SNA”), whereby SNA agreed to present ten-minute multi-media presentations about us to 1,000 individuals over a period of 90 days. We agreed to pay SNA an aggregate of $30,000 in three installments of $10,000 payable on January 1, February 1, and March 1, 2020. SNA is directed by Jim Lupkin, a member of our Board. Mr. Lupkin was in charge of performing services on behalf of SNA under the SNA Service Agreement. Beginning in June 2020, Mr. Bratt, another member of our Board, was appointed the Executive Vice President and Chief Operating Officer of SNA.

 

Notes Due to Related Parties

  

On May 31, 2016, we issued a note payable to Mr. Toh, our President, Chief Executive Officer, and Chairman, in the original principal amount of $24,126. The note was non-interest bearing, unsecured and due on demand. As of July 31, 2019, the outstanding principal amount of the note was $24,126. During fiscal 2020, Mr. Toh forgave the entire principal amount of the note and we recorded this amount to additional paid-in capital.

   

Amounts Due to Related Parties

  

During the years ended July 31, 2019 and 2018, we borrowed from Toga Capital a total amount of $0, and $434,355, respectively, and repaid to Toga Capital a total amount of $183,339, and $49,036, respectively.

  

During the years ended July 31, 2019 and 2018, we repaid $1,968, and $0, respectively, to Mr. Toh on amounts previously borrowed.

   

 
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Director Independence

 

Our Board is currently composed of five members. Currently, Ms. Guinn, Mr. Bratt, and Mr. Lupkin are considered “independent directors” as such term is defined by the rules of the New York Stock Exchange. We determined that Mr. Toh, our Chairman of the Board, Chief Executive Officer, and President, and Mr. Henderson, our Chief Financial Officer, Treasurer, and Secretary, are not independent. We evaluated independence in accordance with the rules of New York Stock Exchange and the SEC. Ms. Guinn, Mr. Bratt and Mr. Lupkin also serve on our Audit, Compensation, and Nominating Committees. Accordingly, all of the members of the Audit, Compensation, and Nominating Committees are also independent.

 

Item 14. Principal Accountant Fees and Services

 

The following table sets forth fees billed, or expected to be billed, to us by our independent registered public accounting firm for the years ended July 31, 2019 and 2018, for (i) services rendered for the audit of our annual financial statements and the review of our quarterly financial statements; (ii) services rendered that are reasonably related to the performance of the audit or review of our financial statements that are not reported as “audit fees;” (iii) services rendered in connection with tax preparation, compliance, advice and assistance; and (iv) all other services:

 

 

 

2019

 

 

2018

 

Audit fees

 

$ 86,388

 

 

$ 25,200

 

Audit related fees

 

 

-

 

 

 

-

 

Tax fees

 

 

-

 

 

 

-

 

Other fees

 

 

-

 

 

 

-

 

Total Fees

 

$ 86,388

 

 

$ 25,200

 

 

Pre-Approval Policies and Procedures

 

The Audit Committee has adopted policies and procedures to oversee the external audit process and pre-approves all services provided by our independent registered public accounting firm. All of the above services and fees were reviewed and approved by our Board or the Audit Committee, as applicable, before the respective services were rendered.

 

 
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PART IV

 

Item 15. Exhibits, Financial Statement Schedules.

 

(a) The following documents are filed as part of this amended Annual Report on Form 10-K:

 

(1) Financial Statements – See Index on page F-1 of this report

 

(b) The following exhibits are filed herewith as a part of this report

 

Exhibit Number

 

Description

 

 

 

3.1

 

Amended and Restated Articles of Incorporation of Toga Limited, filed on September 14, 2020 with the Secretary of State of Nevada, which was filed as Exhibit 3.1 to our Current Report on Form 8-K (File No.: 000-39052) filed with the Securities and Exchange Commission on September 14, 2020, and is incorporated herein by reference thereto.

 

 

 

3.2

 

Amended and Restated Bylaws of Toga Limited, which was filed as Exhibit 3.1 to our Current Report on Form 8-K (File No.: 000-39052) filed with the Securities and Exchange Commission on July 20, 2020, and is incorporated herein by reference thereto.

 

 

 

4.1

 

Description of Securities.*

 

 

 

10.1

 

Amended and Restated Long-Term Incentive Plan dated September 9, 2020, which was filed as Exhibit 10.1 to our Current Report on Form 8-K (File No.: 000-39052) filed with the Securities and Exchange Commission on September 14, 2020, and is incorporated herein by reference thereto.

 

 

 

10.2

 

Sale and Purchase Agreement dated October 17, 2018, by and between TOGL Technology Sdn. Bdh. and Mammoth Empire Estate Sdn. Bhd. (Level Ground), which was filed as Exhibit 10.2 to our Registration Statement on Form S-1 (File No.: 333-232607) filed with the Securities and Exchange Commission on July 11, 2019, and is incorporated herein by reference thereto.

 

 

 

10.3

 

Sale and Purchase Agreement dated October 17, 2018, by and between TOGL Technology Sdn. Bdh. and Mammoth Empire Estate Sdn. Bhd. (Levels 28, 29 and 30), which was filed as Exhibit 10.3 to our Registration Statement on Form S-1 (File No.: 333-232607) filed with the Securities and Exchange Commission on July 11, 2019, and is incorporated herein by reference thereto.

 

 

 

10.4

 

Subscription Agreement dated November 29, 2018, by and between Toga Limited and Mammoth Empire Estate Sdn. Bhd. (Levels Ground, 28, 29 and 30), which was filed as Exhibit 10.4 to our Registration Statement on Form S-1 (File No.: 333-232607) filed with the Securities and Exchange Commission on July 11, 2019, and is incorporated herein by reference thereto.

 

 

 

10.5

 

Sale and Purchase Agreement dated July 29, 2019, by and between TOGL Technology Sdn. Bdh. and Mammoth Empire Estate Sdn. Bhd. (Basement 1)*

 

 
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10.6

 

Sale and Purchase Agreement dated July 29, 2019, by and between TOGL Technology Sdn. Bdh. and Mammoth Empire Estate Sdn. Bhd. (Basement 3)*

 

 

 

10.7

 

Subscription Agreement dated July 29, 2019, by and between Toga Limited and Mammoth Empire Estate Sdn. Bhd. (Basements 1 and 3)*

 

 

 

10.8

 

Stock Purchase Agreement – Phase 1 dated May 31, 2020, by and between Hamidah Bibi A/P Seraj Din, Ahmad Hirzar Bin Sainol Abdin, Eostre Sdn. Bhd., Toga Limited, Toh Kok Soon, and Lim Jun Hao, which was filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q (File No.: 000-39052) filed with the Securities and Exchange Commission on June 15, 2020, and is incorporated herein by reference thereto.

 

 

 

10.9

 

Stock Purchase Agreement – Phase 2 dated May 31, 2020, by and between Ahmad Hirzar Bin Sainol Abdin, Toga Limited, Toh Kok Soon, and Lim Jun Hao, which was filed as Exhibit 10.2 to our Quarterly Report on Form 10-Q (File No.: 000-39052) filed with the Securities and Exchange Commission on June 15, 2020, and is incorporated herein by reference thereto.

 

 

 

10.10

 

Pledge and Security Agreement dated May 31, 2020, by Ahmad Hirzar Bin Sainol Abdin in favor of Toga Limited, which was filed as Exhibit 10.3 to our Quarterly Report on Form 10-Q (File No.: 000-39052) filed with the Securities and Exchange Commission on June 15, 2020, and is incorporated herein by reference thereto.

 

 

 

10.11

 

Pledge and Security Agreement dated May 31, 2020, by Lim Jun Hao in favor of Toga Limited, which was filed as Exhibit 10.4 to our Quarterly Report on Form 10-Q (File No.: 000-39052) filed with the Securities and Exchange Commission on June 15, 2020, and is incorporated herein by reference thereto.

 

 

 

10.12

 

Pledge and Security Agreement dated May 31, 2020, by Toh Kok Soon in favor of Toga Limited, which was filed as Exhibit 10.5 to our Quarterly Report on Form 10-Q (File No.: 000-39052) filed with the Securities and Exchange Commission on June 15, 2020, and is incorporated herein by reference thereto.

 

 

 

10.13

 

Secured Promissory Note dated May 31, 2020, by Ahmad Hirzar Bin Sainol Abdin in favor of Toga Limited, which was filed as Exhibit 10.6 to our Quarterly Report on Form 10-Q (File No.: 000-39052) filed with the Securities and Exchange Commission on June 15, 2020, and is incorporated herein by reference thereto.

 

 

 

10.14

 

Secured Promissory Note dated May 31, 2020, by Lim Jun Hao in favor of Toga Limited, which was filed as Exhibit 10.7 to our Quarterly Report on Form 10-Q (File No.: 000-39052) filed with the Securities and Exchange Commission on June 15, 2020, and is incorporated herein by reference thereto.

 

 

 

10.15

 

Secured Promissory Note dated May 31, 2020, by Toh Kok Soon in favor of Toga Limited, which was filed as Exhibit 10.8 to our Quarterly Report on Form 10-Q (File No.: 000-39052) filed with the Securities and Exchange Commission on June 15, 2020, and is incorporated herein by reference thereto.

 

 
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10.16

 

Form of Scientific Advisory Council Member Agreement between Toga Limited and Eric Thompson, Beverly Rubik and Konstantin Korotkov*

 

 

 

10.17

 

Subscription Agreement dated May 7, 2018, by and between Toga Limited and Agel Enterprises International Sdn Bhd.*

 

 

 

10.18

 

Amended Subscription Agreement dated March 18, 2019, by and between Toga Limited and Agel Enterprises International Sdn Bhd.*

 

 

 

10.19

 

Subscription Termination Agreement dated May 31, 2020, by and between Toga Limited and Agel Enterprises International Sdn Bhd.*

 

 

 

10.20

 

General Services Agreement dated January 1, 2018, by and between TOGL Technology Sdn. Bhd. and Agel Enterprises International Sdn Bhd.*

 

 

 

10.21

 

Amendment to General Services Agreement dated March 31, 2018, by and between TOGL Technology Sdn. Bhd. and Agel Enterprises International Sdn Bhd.*

 

 

 

10.22

 

Termination of General Services Agreement dated April 30, 2019, by and between TOGL Technology Sdn. Bhd. and Agel Enterprises International Sdn Bhd.*

 

 

 

10.23

 

Supplier Agreement dated May 1, 2020, by and between Toga Limited and Subtle Energy Sciences, LLC.*

 

 

 

10.24

 

Collaboration Agreement dated June 1, 2020, by and between Toga Limited and Subtle Energy Sciences, LLC.*

 

 

 

10.25

 

Service Agreement, dated January 1, 2020, by and between Toga Limited and Social Networking Association.*

 

 

10.27

 

Office Service Agreement, dated April 25, 2019, by and between Toga Vietnam Company Limited and Regus Centre (Vietnam) Company Limited.*

 

 

 

10.28

 

Office Agreement, dated June 15, 2020, by and between Toga Limited and Regus Management Group, LLC.*

 

 

 

10.29

 

Business Centre Service Agreement, dated June 22, 2020, by and between TOGL Technology Sdn. Bhd. and Compass COGL Malaysia Services Sdn. Bhd.*

 

 

 

10.30

 

Amendment 1 to the Office Space Lease Agreement, dated December 10, 2018, by and between PT Toga International Indonesia and PT Gunung Maras Lestari.*

 

 
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10.31

 

Office Agreement, dated August 20, 2020, by and between Toga Limited and Regus Management Group, LLC.*

 

 

 

10.32

 

Virtual Office Agreement, dated July 23, 2018, by and between Toga Limited and Regus Management Group, LLC.*

 

 

 

10.33

 

Tenancy Agreement, dated June 24, 2019, by and between PT. Toga International Indonesia and PT Charnic Capital Tbk.*

 

 

 

10.34

 

Renewal Agreement, dated February 22, 2020, by and between Toga Vietnam Company Limited and Regus Centre (Vietnam) Company Limited.*

 

 

 

10.35

 

Tenancy Agreement, dated June 1, 2020, by and between TOGL Technology and Eostre Bhd.*

 

 

 

10.36

 

Tenancy Agreement, dated June 1, 2020, by and between TOGL Technology and Eostre Bhd.*

 

 

 

10.37

 

Tenancy Agreement, dated July 26, 2018, by and between TOGL Technology and AIA, Bhd.*

 

 

 

10.38

 

Office Lease Agreement, dated May 20, 2018, by and between TOGL Technology Sdn. Bhd. and KS Terminals, Inc.*

 

 

 

10.39

 

Office Space Lease Agreement, dated December 18, 2017, by and between Pt. Gunung Maras Leastari and PT. Toga International Indonesia.*

 

 

 

10.40

 

Standard Multi-Tenant Office Lease, dated August 28, 2019, by and between Toga Limited and OC Plaza LLC / McCabe Plaza LLC.*

 

 

 

10.41

 

Executive Agreement, dated February 8, 2019, by and between Toga Limited and Alexander Henderson.*

 

 

 

10.42

 

Amended and Restated Executive Agreement, dated May 1, 2019, by and between Toga Limited and Alexander Henderson.*

 

 

 

10.43

 

Executive Agreement, dated August 1, 2019, by and between Toga Limited and Alexander Henderson.*

 

 

 

10.44

 

Employment Agreement, dated August 1, 2020, by and between Toga Limited and Alexander Henderson.*

 

 

 

14.1

 

Business Code of Ethics and Conduct, which was filed as Exhibit 14.1 to our Current Report on Form 8-K (File No.: 000-39052) filed with the Securities and Exchange Commission on June 22, 2020, and is incorporated herein by reference thereto.

 

 
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14.2

 

Code of Ethics for Financial Officers, which was filed as Exhibit 14.2 to our Current Report on Form 8-K (File No.: 000-39052) filed with the Securities and Exchange Commission on June 22, 2020, and is incorporated herein by reference thereto.

 

 

 

21.1

 

Subsidiaries of the Registrant*

 

 

 

24

 

Power of Attorney*

 

 

 

31.1

 

Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934*

 

 

 

31.2

 

Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934*

 

 

 

32.1

 

Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350 of Chapter 63 of Title 18 of the United States Code*

 

 

 

32.2

 

Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350 of Chapter 63 of Title 18 of the United States Code*

 

101.INS XBRL Instance Document*

101.SCH XBRL Taxonomy Extension Schema Document*

101.CAL XBRL Taxonomy Extension Calculation Linkbase Document*

101.DEF XBRL Taxonomy Extension Definition Linkbase Document*

101.LAB XBRL Taxonomy Extension Label Linkbase Document*

101.PRE XBRL Taxonomy Presentation Linkbase Document*

 

*filed herewith

 

Item 16. Form 10-K Summary.

 

None.

 

 
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Toga Limited

 

Index to Consolidated Financial Statements

 

Report of Independent Registered Public Accounting Firm

 

F-2

 

Consolidated Balance Sheets as of July 31, 2019 and 2018

 

F-3

 

Consolidated Statements of Operations for the years ended July 31, 2019 and 2018

 

F-4

 

Consolidated Statements of Changes in Stockholders’ Equity for the years ended July 31, 2019 and 2018

 

F-5

 

Consolidated Statements of Cash Flows for the years ended July 31, 2019 and 2018

 

F-6

 

Notes to Consolidated Financial Statements

 

F-7

 

 

 
F-1

Table of Contents

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

To the Board of Directors and Shareholders of

Toga Limited

Los Angeles, California

 

 

Opinion on the Financial Statements

 

We have audited the accompanying consolidated balance sheets of Toga Limited (the Company) as of July 31, 2019 and 2018, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for the years then ended, and the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of July 31, 2019 and 2018, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

 

Basis for Opinion

 

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

Restatement of Financial Statements

 

As discussed in Note 10 to the consolidated financial statements, the July 31, 2019 consolidated financial statements have been restated to correct a misstatement.

 

 

/s/ Pinnacle Accountancy Group of Utah

 

We have served as the Company’s auditor since 2018.

 

Pinnacle Accountancy Group of Utah

Farmington, Utah

November, 13 2019, except for the effects of the matters described in Note 2, Note 5, Note 7, Note 9 and Note 10 which are dated February 5, 2021

 

 

 
F-2

Table of Contents

 

Toga Limited

Consolidated Balance Sheets

 

 

 

July 31,

 

 

July 31,

 

 

 

2019

 

 

2018

 

 

 

(Restated)

 

 

 

ASSETS

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash and cash equivalents

 

$ 14,916,556

 

 

$ 1,064,672

 

Accounts receivable, net

 

 

294,266

 

 

 

367,918

 

Prepaid expense and other current assets

 

 

3,747,648

 

 

 

25,958

 

Inventories

 

 

162,985

 

 

 

-

 

Total Current Assets

 

 

19,121,455

 

 

 

1,458,548

 

 

 

 

 

 

 

 

 

 

Property and equipment

 

 

4,421,252

 

 

 

135,706

 

Intangible asset - digital currency

 

 

-

 

 

 

1,348,920

 

Intangible asset - goodwill

 

 

11,718

 

 

 

-

 

Deposit

 

 

-

 

 

 

9,780

 

TOTAL ASSETS

 

$ 23,554,425

 

 

$ 2,952,954

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$ 4,221,413

 

 

$ 180,573

 

Due to related parties

 

 

1,083

 

 

 

186,390

 

Notes due to related parties

 

 

24,126

 

 

 

24,126

 

Deferred revenue

 

 

4,741,945

 

 

 

20,500

 

Income tax payable

 

 

52,641

 

 

 

-

 

Total Current Liabilities

 

 

9,041,208

 

 

 

411,589

 

 

 

 

 

 

 

 

 

 

Deferred tax liabilities

 

 

8,574

 

 

 

-

 

Total Liabilities

 

 

9,049,782

 

 

 

411,589

 

 

 

 

 

 

 

 

 

 

Stockholders’ Equity

 

 

 

 

 

 

 

 

Preferred stock, $0.0001 par value, 20,000,000 shares authorized; none issued and outstanding

 

 

-

 

 

 

-

 

Common stock, $0.0001 par value, 1,000,000,000 shares authorized; 90,762,893 and 69,586,517 shares issued and outstanding as of April 30, 2019 and July 31, 2018, respectively

 

 

9,076

 

 

 

6,959

 

Common stock subscribed; 30,000,000 common shares, $0.0001 par value

 

 

(3,000 )

 

 

(3,000 )

Additional paid-in capital

 

 

38,993,002

 

 

 

16,942,861

 

Accumulated deficit

 

 

(24,622,041 )

 

 

(14,351,459 )

Accumulated other comprehensive loss

 

 

69,238

 

 

 

(53,996 )

Total Stockholders’ equity of Toga Ltd,

 

 

14,446,275

 

 

 

2,541,365

 

Non-controlling interest

 

 

58,368

 

 

 

-

 

Total Stockholders’ equity

 

 

14,504,643

 

 

 

2,541,365

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$ 23,554,425

 

 

$ 2,952,954

 

 

See accompanying notes to the audited consolidated financial statements

 

 
F-3

Table of Contents

 

Toga Limited

Consolidated Statements of Operations

 

 

 

Year ended

 

 

 

July 31,

 

 

 

2019

 

 

2018

 

 

 

(Restated)

 

 

 

Revenue

 

$ 5,888,234

 

 

$ 1,254,495

 

Cost of goods sold

 

 

1,729,748

 

 

 

145,847

 

Gross profit

 

 

4,158,486

 

 

 

1,108,648

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

General and administrative expenses

 

 

3,183,220

 

 

 

726,016

 

Salaries and wages

 

 

13,074,717

 

 

 

467,621

 

Professional fees

 

 

1,110,236

 

 

 

443,068

 

Research and development

 

 

-

 

 

 

-

 

Depreciation

 

 

93,426

 

 

 

15,050

 

Total Operating Expenses

 

 

17,461,599

 

 

 

1,651,755

 

 

 

 

 

 

 

 

 

 

LOSS FROM OPERATIONS

 

 

(13,303,113 )

 

 

(543,107 )

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE)

 

 

 

 

 

 

 

 

Other income

 

 

-

 

 

 

205,748

 

Interest income

 

 

16,386

 

 

 

-

 

Interest expense

 

 

(849 )

 

 

(382 )

Loss on settlement of debt

 

 

-

 

 

 

(13,282,567 )

Gain on sales of digital currency

 

 

3,230,882

 

 

 

-

 

Total Other Income (Expense)

 

 

3,246,419

 

 

 

(13,077,201 )

 

 

 

 

 

 

 

 

 

Loss before Income Taxes

 

 

(10,056,694 )

 

 

(13,620,308 )

 

 

 

 

 

 

 

 

 

Income Tax Provision

 

 

(155,520 )

 

 

-

 

 

 

 

 

 

 

 

 

 

Net Loss

 

$ (10,212,214 )

 

$ (13,620,308 )

Add: Net gain attributable to non-controlling interest

 

 

58,368

 

 

 

-

 

Net loss attributable to Toga ltd.

 

$ (10,270,582 )

 

$ (13,620,308 )

 

 

 

 

 

 

 

 

 

OTHER COMPREHENSIVE INCOME (LOSS)

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

123,234

 

 

 

(53,996 )

TOTAL COMPREHENSIVE LOSS

 

$ (10,147,348 )

 

$ (13,674,304 )

 

 

 

 

 

 

 

 

 

BASIC AND DILUTED NET LOSS PER COMMON SHARE:

 

 

 

 

 

 

 

 

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING

 

 

82,842,852

 

 

 

251,631,167

 

NET LOSS PER COMMON SHARE

 

$ (0.12 )

 

$ (0.05 )

 

See accompanying notes to the audited consolidated financial statements

 

 
F-4

Table of Contents

 

Toga Limited

Consolidated Statements of Changes in Stockholders’ Equity

For the years ended July 31, 2019 and 2018

(Restated)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

Total

 

 

 

Common Stock

 

 

 

 

 

Additional

 

 

 

 

 

Other

 

 

Non

 

 

Stockholders'

 

 

 

Number of Shares

 

 

Amount

 

 

Subscription

Receivable

 

 

Paid-in

Capital

 

 

Accumulated

Deficit

 

 

Comprehensive

Loss

 

 

Controlling

interest

 

 

Equity (Deficit)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - July 31, 2017

 

 

254,635,470

 

 

$ 25,464

 

 

$ (3,000 )

 

$ 587,187

 

 

$ (731,151 )

 

$ -

 

 

$ -

 

 

$ (121,500 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of common shares for cash

 

 

10,759,380

 

 

 

1,076

 

 

 

-

 

 

 

1,312,423

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,313,499

 

Issuance of common shares for digital currency

 

 

269,838

 

 

 

27

 

 

 

-

 

 

 

1,348,893

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,348,920

 

Issuance of common shares for conversion

 

 

3,921,829

 

 

 

392

 

 

 

-

 

 

 

13,674,358

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,674,750

 

Cancellation of common shares

 

 

(200,000,000 )

 

 

(20,000 )

 

 

-

 

 

 

20,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Other comprehensive loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(53,996 )

 

 

-

 

 

 

(53,996 )

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(13,620,308 )

 

 

-

 

 

 

-

 

 

 

(13,620,308 )

Balance - July 31, 2018

 

 

69,586,517

 

 

$ 6,959

 

 

$ (3,000 )

 

$ 16,942,861

 

 

$ (14,351,459 )

 

$ (53,996 )

 

$ -

 

 

$ 2,541,365

 

Issuance of common shares for cash

 

 

10,490,362

 

 

 

1,049

 

 

 

-

 

 

 

2,097,024

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,098,073

 

Issuance of common shares for digital currency

 

 

9,078,998

 

 

 

908

 

 

 

-

 

 

 

4,877,532

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,878,440

 

Issuance of stock options

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,061,017

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,061,017

 

Issuance of common shares for employee compensation

 

 

1,156,539

 

 

 

115

 

 

 

-

 

 

 

10,015,559

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

10,015,674

 

Issuance of common shares for acquisition of properties

 

 

470,477

 

 

 

47

 

 

 

-

 

 

 

3,999,007

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,999,054

 

Cancellation of common shares

 

 

(20,000 )

 

 

(2 )

 

 

-

 

 

 

2

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Other comprehensive loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

123,234

 

 

 

-

 

 

 

123,234

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(10,270,582 )

 

 

-

 

 

 

58,368

 

 

 

(10,212,214 )

Balance - July 31, 2019

 

 

90,762,893

 

 

$ 9,076

 

 

$ (3,000 )

 

$ 38,993,002

 

 

$ (24,622,041 )

 

$ 69,238

 

 

$ 58,368

 

 

$ 14,504,643

 

 

See accompanying notes to the audited consolidated financial statements

 

 
F-5

Table of Contents

 

Toga Limited

Consolidated Statements of Cash Flows

 

 

 

Year ended

 

 

 

July 31,

 

 

 

2019

 

 

2018

 

 

 

(Restated)

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

Net loss

 

$ (10,212,214 )

 

$ (13,620,308 )

Adjustments to reconcile net loss to net cash from operating activities:

 

 

 

 

 

 

 

 

Depreciation

 

 

93,426

 

 

 

15,050

 

Gain on sale of digital currency

 

 

(3,230,882 )

 

 

-

 

Stock based compensation

 

 

11,076,691

 

 

 

-

 

Loss on settlement of debt

 

 

-

 

 

 

13,282,567

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

73,652

 

 

 

(368,079 )

Deposit

 

 

(9,780 )

 

 

-

 

Inventories

 

 

(162,985 )

 

 

-

 

Prepaid expenses and other current assets

 

 

(3,721,690 )

 

 

(36,650 )

Deferred revenue

 

 

4,721,445

 

 

 

20,500

 

Accounts payable and accrued liabilities

 

 

4,040,841

 

 

 

214,831

 

Income tax payable

 

 

61,215

 

 

 

-

 

Net cash used in operating activities

 

 

2,729,719

 

 

 

(492,089 )

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

 

 

Purchase of property and equipment

 

 

(372,077 )

 

 

(152,287 )

Net cash used in investing activities

 

 

(372,077 )

 

 

(152,287 )

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

Proceeds from sale of digital currency

 

 

9,458,242

 

 

 

-

 

Proceeds from issuance of common stock

 

 

2,098,073

 

 

 

1,313,499

 

Proceeds from related parties

 

 

-

 

 

 

434,355

 

Repayment to related party

 

 

(185,307 )

 

 

(49,036 )

Net cash provided by financing activities

 

 

11,371,008

 

 

 

1,698,818

 

 

 

 

 

 

 

 

 

 

Effects on changes in foreign exchange rate

 

 

123,234

 

 

 

10,130

 

 

 

 

 

 

 

 

 

 

Net increase in cash and cash equivalents

 

 

13,851,884

 

 

 

1,064,572

 

Cash and cash equivalents - beginning of period

 

 

1,064,672

 

 

 

100

 

Cash and cash equivalents - end of period

 

$ 14,916,556

 

 

$ 1,064,672

 

 

 

 

 

 

 

 

 

 

Supplemental Cash Flow Disclosures

 

 

 

 

 

 

 

 

Cash paid for interest

 

$ -

 

 

$ -

 

Cash paid for income taxes

 

$ -

 

 

$ -

 

 

 

 

 

 

 

 

 

 

Non-Cash Investing and Financing Activity:

 

 

 

 

 

 

 

 

Cancellation of Common Stock

 

$ 20

 

 

$ -

 

Note exchanged for due to related parties

 

$ -

 

 

$ 152,973

 

Common Shares issued to settle related party note payable

 

$ -

 

 

$ 13,674,750

 

Common Stock Issued for Digital Currency

 

$ 4,878,440

 

 

$ 1,348,920

 

Common shares issued for acquisition of real property

 

$ 3,999,054

 

 

$ -

 

 

See accompanying notes to the audited consolidated financial statements

 

 
F-6

Table of Contents

 

Toga Limited

Notes to Consolidated Financial Statements

July 31, 2019 and 2018

 

NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS

 

Business Description

 

Toga Limited (the “Company”) was originally incorporated as Fashionfreakz International Inc. on October 23, 2003, under the laws of the State of Delaware. On December 2, 2005, Fashionfreakz International Inc. changed its name to Blink Couture Inc. Until March 4, 2008, the Company’s principal business was the online retail marketing of trendy clothing and accessories produced by independent designers. On March 4, 2008, the Company discontinued its prior business and changed its business plan. On June 13, 2016, a change of control of the Company occurred. On that date, the current president and Chief Executive Officer purchased a total of 13,869,150 of the issued and outstanding shares of the Company. On July 22, 2016, the Company changed its name to “Toga Limited.” In July 2018, the Company changed its state of incorporation to the State of Nevada.

 

On June 10, 2017, the Board of Directors unanimously adopted resolutions authorizing the increase of the Company’s authorized number of shares of common stock from one hundred million (100,000,000) shares to ten billion (10,000,000,000) shares and increased the number of the Company’s total issued and outstanding shares of common stock by conducting a forward split at the rate of fifty (50) shares for every one (1) (50:1) share currently issued and outstanding (the “Forward Split”). The Forward Split became effective in the market on September 11, 2017 following approval by the Financial Industry Regulatory Authority, Inc. (“FINRA”). All share amounts in these consolidated financial statements have been adjusted retroactively. On May 8, 2019, the Company filed a Certificate of Amendment with the Nevada Secretary of State whereby it amended Article IV of its Articles of Incorporation by decreasing the Company’s authorized number of shares of common stock from ten billion (10,000,000,000) shares to one billion (1,000,000,000) shares and decreasing its issued and outstanding shares of common stock at a ratio of ten (10) shares for every one (1) share held (“10-1 Reverse Split”). The Company’s Board of Directors approved this amendment on April 24, 2019. The 10-1 Reverse Split became effective on June 5, 2019 following approval by FINRA. All share and per share information in these consolidated financial statements retroactively reflect this 10-1 Reverse Split.

 

On September 11, 2020, the Company filed Amended and Restated Articles of Incorporation (the “A&R Articles of Incorporation”) with the Secretary of State of the State of Nevada for the purpose of dividing and designating the 1,000,000,000 shares of common stock into two classes, consisting of 500,000,000 shares of Class A voting common stock, par value $0.0001 per share (referred to herein as the “common stock”), and 500,000,000 shares of Class B non-voting common stock, par value $0.0001 per share (referred to herein as the “Class B common stock”), none of which are currently issued and outstanding.

 

In September 2017, the Company formed TOGL Technology Sdn. Bhd. (“TOGL Technology”), a wholly owned subsidiary located in Malaysia. In May 2018, TOGL Technology opened a branch office in Taiwan. The Company suspended operations of its Taiwan branch in July 2020 due to the novel coronavirus (“COVID-19”). TOGL Technology offers technology and professional services to facilitate the use of technology by enterprises and end users. These services include software development, integration, maintenance, mobile services, and web applications. TOGL Technology also provides development of, and upgrades to, our mobile application, the Yippi App.

 

In November 2017, the Company formed PT. Toga International Indonesia (“PT Toga Indonesia”), a majority-owned subsidiary located in Indonesia. The Company owns a 95% interest in PT Toga Indonesia. The remaining portion is owned by three individuals who are employed by the Company’s subsidiaries. PT Toga Indonesia mainly sells health-related and facial products via retail stores or through direct selling independent sales agents that sell the Company’s “Eostre” branded products at exhibitions and healthy introduction seminars.

 

In January 2019, TOGL Technology, formed a wholly-owned subsidiary, Toga Vietnam Company Limited (“Toga Vietnam”), located in Vietnam. Toga Vietnam provides customer services support for Yippi users located in Vietnam.

 

In May 2019, TOGL Technology, formed a majority-owned subsidiary, PT TOGL Technology Indonesia (“PT TOGL Indonesia”), located in Indonesia. TOGL Technology owns a 67% interest in PT TOGL Indonesia. PT TOGL Indonesia provides technology and professional services to facilitate the use of technology by enterprises and end users. These services include software development, integration, maintenance, mobile services, and web applications.

 

In June 2019, TOGL Technology acquired 100% of the issued and outstanding shares of WGS Discovery Tours and Travel (M) Sdn. Bhd., a Malaysian based company (“WGS”). WGS manages the Company’s travel, hotel, and flight feature (“TogaGo”) offered through the Yippi App.

 

In June 2020, Michael Toh Kok Soon (“Mr. Toh”), our Chief Executive Officer and Chairman, Roy Lim Jun Hao (“Mr. Lim”), TOGL Technology’s Deputy Executive Officer, and we collectively acquired 65% of the issued and outstanding shares of Eostre Bhd., a Malaysia corporation (“Eostre Bhd.”). We intend to acquire the remaining 35% of the issued and outstanding shares of Eostre Bhd. as described in more detail below under the section entitled “Eostre – Recent Changes to the Eostre Business.” Further, Eostre Bhd.’s business is discussed in detail below under the section entitled “Eostre.”

 

 
F-7

Table of Contents

 

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

These consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars. The Company uses the accrual basis of accounting and has adopted a July 31 fiscal year end.

 

Basis of Consolidation

 

These consolidated condensed financial statements include the accounts of the Company and the wholly-owned subsidiaries, TOGL Technology, and PT. Toga Indonesia. All material intercompany balances and transactions have been eliminated. TOGL Technology incorporates the financial statements of the Taiwan and Vietnam office.

 

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Some of these judgments can be subjective and complex, and, consequently, actual results may differ from these estimates.

 

Cash and Cash Equivalents

 

Cash and cash equivalents consist of cash and highly liquid investments with remaining maturities of less than ninety days at the date of purchase.

 

Basic and Diluted Earnings per Share

 

Pursuant to the authoritative guidance, basic net income and net loss per share are computed by dividing the net income and net loss by the weighted average number of common shares outstanding. Diluted net income and net loss per share is the same as basic net income and net loss per share when their inclusion would have an anti-dilutive effect due to our continuing net losses.

 

As of July 31, 2019, the Company had potentially 120,000 dilutive securities from outstanding stock options, which were excluded from the computation of diluted net loss per common share because the computation was anti-dilutive.

 

Software Development

 

The Company accounts for all software and development costs in accordance with ASC 985-20 – Software. Accordingly, all costs incurred prior to establishing technological feasibility have been expensed. As of July 31, 2019, none of the costs subsequent to technological feasibility associated with software and development met the criteria for capitalization.

 

Inventories

 

Inventories are stated at lower of cost or net realizable value, with cost being determined on the first-in, first-out (“FIFO”) method.

 

No reserves are considered necessary for slow moving or obsolete inventory as inventory on hand at year-end was purchased near the end of the year. The Company continuously evaluates the adequacy of these reserves and makes adjustments to these reserves as required.

 

As of July 31, 2019 and 2018, the Company had inventories of $162,985 and $0, respectively.

 

 
F-8

Table of Contents

 

Equipment and Furniture

 

Property and equipment are stated at cost. Depreciation is computed on the straight-line method. The depreciation and amortization methods are designed to amortize the cost of the assets over their estimated useful lives, in years, of the respective assets as follows:

 

Building

20 years

Renovation

3 to 5 years

Fixtures and Furniture

4 to 5 years

Tools and Equipment

4 to 5 years

Vehicles

3 to 5 years

Computer Equipment

4 to 5 years

 

Maintenance and repairs are charged to expense as incurred. Improvements of a major nature are capitalized. At the time of retirement or other disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts and any gains or losses are reflected in income.

 

The long-lived assets of the Company are reviewed for impairment in accordance with ASC 360, “Property, Plant and Equipment” (“ASC 360”), whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. During the years ended July 31, 2019 and 2018, no impairment losses were identified.

 

Goodwill and Other Intangible Assets – Digital Currency

 

We account for goodwill and intangible assets in accordance with ASC 350 “Intangibles-Goodwill and Other” (“ASC 350”). ASC 350 requires that goodwill and other intangibles with indefinite lives be tested for impairment annually or on an interim basis if events or circumstances indicate that the fair value of an asset has decreased below its carrying value. In addition, ASC 350 requires that goodwill be tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests when circumstances indicate that the recoverability of the carrying amount of goodwill may be in doubt. Application of the goodwill impairment test requires judgment, including the identification of reporting units; assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value. Significant judgments required to estimate the fair value of reporting units include estimating future cash flows, determining appropriate discount rates and other assumptions. Changes in these estimates and assumptions or the occurrence of one or more confirming events in future periods could cause the actual results or outcomes to materially differ from such estimates and could also affect the determination of fair value and/or goodwill impairment at future reporting dates.

 

On June 24, 2019, the Company’s wholly owned subsidiary TOGL Technology acquired 100% shares of WGS in Malaysia, which generated goodwill of $11,718. The Company has accounted for the transaction in accordance with ASC 805 “Business Combinations.”

 

Based on the Company’s analysis of goodwill as of July 31, 2019, no indicators of impairment exist. No impairment loss on goodwill was recognized for the year ended July 31, 2019.

 

Foreign Currency Translations

 

The Company’s functional and reporting currency is the U.S. dollar. TOGL Technology’s functional currency is the Malaysian ringgit. All transactions initiated in Malaysian ringgit, New Taiwan dollar, Vietnamese dong, and Indonesian rupiah are translated into U.S. dollars in accordance with ASC 830-30, Translation of Financial Statements,” as follows:

 

 

1)

Monetary assets and liabilities at the rate of exchange in effect at the balance sheet date.

 

2)

Equity at historical rates.

 

3)

Revenue and expense items at the average rate of exchange prevailing during the period.

 

Adjustments arising from such translations are deferred until realization and are included as a separate component of stockholders’ equity as a component of comprehensive income or loss. Therefore, translation adjustments are not included in determining net income (loss) but reported as other comprehensive income. Gains and losses from foreign currency transactions are included in earnings in the period of settlement.

 

 

 

Year ended

 

 

Year ended

 

 

 

July 31,

 

 

July 31,

 

 

 

2019

 

 

2018

 

Spot MYR: USD exchange rate

 

$ 0.2422

 

 

$ 0.246

 

Average MYR: USD exchange rate

 

$ 0.2421

 

 

$ 0.2489

 

Spot NTD: USD exchange rate

 

$ 0.0321

 

 

$ 0.0326

 

Average NTD: USD exchange rate

 

$ 0.0323

 

 

$ 0.033

 

Spot IDR: USD exchange rate

 

$ 0.000071

 

 

$ 0.000069

 

Average IDR: USD exchange rate

 

$ 0.000069

 

 

$ 0.000072

 

Spot VND: USD exchange rate

 

$ 0.000043

 

 

$ n/a

 

Average VND: USD exchange rate

 

$ 0.000043

 

 

$ n/a

 

 

 
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Table of Contents

 

Stock-based Compensation

 

We account for stock-based awards at fair value on the date of grant, and recognize compensation over the service-period that they are expected to vest. We estimate the fair value of stock options and stock purchase warrants using the Black-Scholes option pricing model. The estimated value of the portion of a stock-based award that is ultimately expected to vest, taking into consideration estimated forfeitures, is recognized as expense over the requisite service periods. The model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time, of other comparative securities, equal to the weighted average life of the options. The estimate of stock awards that will ultimately vest requires judgment, and to the extent that actual forfeitures differ from estimated forfeitures, such differences are accounted for as a cumulative adjustment to compensation expenses and recorded in the period that estimates are revised.

 

Stock-based compensation incurred for the year ended July 31, 2019 and 2018, respectively, are summarized as follows:

 

 

 

Year Ended

 

 

 

July 31,

 

 

 

2019

 

 

2018

 

Vesting of stock options issued to directors and officers

 

 

1,061,017

 

 

 

-

 

Common stock issued to related parties, employees and consultants

 

 

10,015,674

 

 

 

-

 

 

 

$ 11,076,691

 

 

$ -

 

 

Fair Value

 

FASB ASC 820, “Fair Value Measurements and Disclosures” (“ASC 820”) establishes a framework for all fair value measurements and expands disclosures related to fair value measurement and developments. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

 

ASC 820 requires that assets and liabilities measured at fair value are classified and disclosed in one of the following three categories:

 

Level 1Quoted market prices for identical assets or liabilities in active markets or observable inputs;

 

Level 2Significant other observable inputs that can be corroborated by observable market data; and

 

Level 3Significant unobservable inputs that cannot be corroborated by observable market data.

 

The carrying amounts of cash, accounts payable and other liabilities, accrued interest payable, and convertible notes approximate fair value because of the short-term nature of these items.

 

Related Party Balances and Transactions

 

The Company follows FASB ASC 850, “Related Party Disclosures,” for the identification of related parties and disclosure of related party transaction. See Note 5 for additional information.

 

Income Taxes

 

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance on deferred tax assets is established when management considers it is more likely than not that some portion or all of the deferred tax assets will not be realized.

 

Tax benefits from an uncertain tax position are only recognized if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate resolution. Interest and penalties related to unrecognized tax benefits are recorded as incurred as a component of income tax expense. The Company has not recognized any tax benefits from uncertain tax positions for any of the reporting periods presented.

 

 
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Table of Contents

 

Revenue Recognition (Restated)

 

In May 2014, the FASB issued new accounting guidance related to revenue from contracts with customers. The core principle of the Standard is that recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new guidance requires that companies disclose the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company has chosen to early adopt and apply the standards beginning in the fiscal year ended July 31, 2019, using the modified retrospective approach, which applies the new standard to contracts that are not completed as of the date of adoption. The Company concluded that no adjustment to the opening balance of retained earnings was required upon the adoption of the new standard.

   

In accordance with ASC 606 – Revenue from Contracts with Customers, the Company recognizes revenues when satisfying the performance obligation of the associated contract that reflects the consideration expected to be received based on the terms of the contract.

 

Revenue related to contracts with customers is evaluated utilizing the following steps: (i) Identify the contract, or contracts, with a customer; (ii) Identify the performance obligations in the contract; (iii) Determine the transaction price; (iv) Allocate the transaction price to the performance obligations in the contract; (v) Recognize revenue when the Company satisfies a performance obligation.

 

When the Company enters into a contract, the Company analyzes the services required in the contract in order to identify the required performance obligations which would indicate the Company has met and fulfilled its obligations. For the current contracts in place, the Company has identified performance obligations as agreement from both parties (implicit or explicit) that the obligations have been met. To appropriately identify the performance obligations, the Company considers all of the services required to be satisfied per the contract, whether explicitly stated or implicitly implied. The Company allocates the full transaction price to the single performance obligation being satisfied.

 

The Company recognizes revenue when the customer confirms to the Company that all of the terms and conditions of the contract has been met. During the year ended July 31, 2019, the Company derived its revenues from the following:

 

1) The sale of products through a direct marketing network (approximately $4.3 million and $0 for year ended July 31, 2019 and 2018, respectively). Invoices are prepared for all sales of products through a direct marketing network. In accordance with ASC 606revenues related to direct marketing network sales are recognized when:

 

i. Invoice has been generated and provided to the customer

ii. Performance obligations of delivery of products are stated in the invoice

iii. Transaction price has been identified in the invoice

iv. The Company has allocated the transaction price to performance obligation in the invoice

v. The Company has shipped out the product and therefore satisfied the performance obligation

 

2) Yippi in-apps purchase ($0). In accordance with ASC 606 revenue related to in-app purchases are recognized when:

 

i. Invoice or receipt has been generated upon in-app purchase 

ii. Performance obligations of delivery of in-app purchases are stated or implied on purchase portal

iii. Transaction price has been identified in the in-app purchase

iv. The Company has allocated the transaction price to implied performance obligation. In regards to in-apps purchases, there is a lag in between the time where a customer makes in-apps purchase and the time that the customer spends the in-app purchase and/or points. 

v. The Company has provided the in-app purchase to the end user. When the end-user utilizes the in-apps purchase and/or points, revenue is recognized at that point in time only to the extent of the in-app point usage. All in-app purchases that have not been utilized by the end-user are recorded as deferred revenue until the point in which they are utilized by the end-user, at which time they will be recorded as revenue.

 

3) Togago platform revenue ($0). In accordance with ASC 606 revenue related to Togago platform revenue purchases are recognized when:

 

i. Invoice or receipt has been generated upon Togago platform purchase  

ii. Performance obligations of delivery of products and services are stated or implied on purchase portal

iii. Transaction price has been identified in the platform purchase

iv. The Company has allocated the transaction price to implied performance obligation 

v. The Company has received confirmation from the third-party booking that satisfied the performance obligation

 

4) Advertising revenue using a custom-built advertising feature that matches client advertising requirement. network (approximately $0.2 million and $0.1 million for year ended July 31, 2019 and 2018, respectively). In accordance with ASC 606 revenue related to in-app purchases are recognized when:

 

i. Contract has been signed by both parties for advertising to be provided within apps 

ii. Performance obligations of delivery of advertising are implied in the contract

iii. Transaction price has been identified in the contract

iv. The Company has allocated the transaction price to advertising performance obligations per contract

v. The Company has provided in app advertising in accordance with the contract and has therefore satisfied the performance obligation

 

 
F-11

 

  

5) Management fees and information technology fees (approximately $1.4 million and $1.1 million for year ended July 31, 2019 and 2018, respectively). In accordance with ASC 606 revenue related to management fees and information technology revenue are recognized when:

 

i. Contract has been signed by both parties for management and information technology services to be provided

ii. Performance obligations of delivery of management and information technology services are implied in the contract

iii. Transaction price has been identified in the contract

iv. The Company has allocated the transaction price to management and information technology performance obligations per contract

v. The Company has provided management and information technology services in accordance with the contract and has therefore satisfied the performance obligation

 

The Company analyses whether gross sales, or net sales should be recorded. Since the Company has control over establishing price, and has control over the related costs with earning revenues, it has recorded all revenues at the gross price.

 

Cash payments received are recorded as deferred revenue until the conditions, stated above, of revenue recognition have been met, specifically all obligations have been met as specified in the related customer contract.

 

Deferred Revenue 

 

Deferred revenue consists of Yippi in-app purchases received from users in advance of revenue recognition and sales made for purchases in the Direct Marketing Network where the product delivery has not been made.  The increase in the deferred revenue balance for the year ended July 31, 2019 was driven by payments from customers in advance of satisfying our performance obligations, offset by revenue recognized that was included in the deferred revenue balance at the beginning of the period.

 

Deferred Revenue from Yippi In-App Purchases

 

The Company has created in-app points to use within the Yippi App. These in-app points are called Yipps. Once purchased by a user, Yipps can be used in a variety of different ways within the Yippi App. Yipps can be used to gift or tip other users, or to purchase merchandise and services from vendors. 

 

When these points are initially purchased (but not yet used), they are recognized as deferred revenue. When these points are later used within the Yippi App (for purchases, tipping, gifting, etc.), the revenue is recognized. 

 

Yipps do not have an expiration date, and this is a relatively new revenue source for the Company (deferred revenue from Yipps was first recorded in May 2019). On an ongoing basis as Yipps are purchased and used in-app, the Company expects to recognize all of the deferred revenue from a Yipps purchase as revenue within 12 months of the original purchase of such Yipps. The Company’s estimate is qualified by the limited data of historical usage.

 

Prepaid Commission

 

In connection with the sale of our Eostre branded products, we pay a commission to our independent agents.  The commission is payable upon the sale of the products, not upon shipment of the products.  The Company books the commission at the time of sale to a prepaid Commission account, included in prepaid expense and other current assets, and offsets this amount by booking a payable to the independent agent.  At the time the product is shipped, and the obligation is fulfilled, the Company then recognizes commission expense out of the prepaid commission account. As of July 31, 2019, and 2018, the Company recorded in prepaid expense and other current assets $2,503,269 and $0, respectively, for prepaid commissions.

 

Concentration of Revenue by Customer

 

The Company’s concentration of revenue for individual customers above 10% are as follows:

 

 

·

Agel: 23%,

 

·

Others: 77%

 

Concentration of Revenue by Country:

 

 

·

Malaysia (TOGL Technology): 51%

 

·

Indonesia (PT. Toga Indonesia): 45%

 

·

United States (Toga Limited): 4%

 

The Company attributes revenue from external customers to individual countries based upon the responsibility of the entity to fulfil the sales obligation and the entity from which the actual service is provided.

 

Accounts Receivable

 

The Company’s accounts receivable balance is related to advertising and management fees through TOGL Technology. Accounts receivable are recorded in accordance with ASC 310, Receivables.” Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable. The Company does not currently have any amount recorded as an allowance for doubtful accounts. Based on management’s estimate and based on all accounts being current, the Company has not deemed it necessary to reserve for doubtful accounts at this time.

 

As of July 31, 2019, the Company’s accounts receivable was concentrated 70% with Agel.

 

As of July 31, 2019, the Company’s accounts receivable was concentrated 93% in Malaysia (TOGL Technology) and 7% in United States (Toga Limited).

 

Research and Development Expenses

 

We follow ASC 730, Research and Development, and expense research and development costs when incurred. Accordingly, third-party research and development costs, including designing, prototyping and testing of product, are expensed when the contracted work has been performed or milestone results have been achieved. Indirect costs are allocated based on percentage usage related to the research and development.

 

 
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Table of Contents

 

Recent Accounting Pronouncements

 

In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, “Leases” (“ASC 842”). The guidance requires lessees to recognize almost all leases on their balance sheet as a right-of-use asset and a lease liability. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model and the new revenue recognition standard. Existing sale-leaseback guidance, including guidance for real estate, is replaced with a new model applicable to both lessees and lessors. ASC 842 was effective for fiscal years beginning after December 15, 2018. The Company is evaluating the adoption of ASC 842, but has not determined the effects it may have on the Company’s consolidated financial statements.

 

In November 2018, the FASB issued ASU No. 2018-08 “Collaborative Arrangements” (Topic 808) intended to improve financial reporting around collaborative arrangements and align the current guidance under ASC 808 with ASC 606 “Revenue from Contracts with Customers.” The ASU affects all companies that enter into collaborative arrangements. The ASU clarifies when certain transactions between collaborative arrangement participants should be accounted for as revenue under Topic 606 and changes certain presentation requirements for transactions with collaborative arrangement participants that are not directly related to sales to third parties. The standard was effective for fiscal years beginning after December 15, 2019 and interim periods therein. Earlier adoption is permitted for any annual or interim period for which consolidated financial statements have not yet been issued. The Company has not entered into any collaborative arrangements and, therefore, does not currently expect the adoption of this standard to have a material effect on its consolidated financial statements. The Company plans to adopt this ASU either on the effective date of January 1, 2020 or possibly in an earlier period if a collaborative arrangement is entered. Upon adoption, the Company will utilize the retrospective transition approach, as prescribed within this ASU.

 

The Company reviewed and analyzed the above recent accounting pronouncements and determined that none of these recent accounting pronouncements will have a material impact on the consolidated financial statements as of July 31, 2019.

 

NOTE 3. PROPERTY AND EQUIPMENT

 

As of July 31, 2019 and 2018, the balance of property and equipment represented consisted of the followings:

 

 

 

July 31,

 

 

July 31,

 

 

 

2019

 

 

2018

 

Building

 

$ 4,019,563

 

 

$ -

 

Renovation

 

 

154,120

 

 

 

85,362

 

Fixtures and Furniture

 

 

69,555

 

 

 

38,046

 

Tools and Equipment

 

 

92,494

 

 

 

20,796

 

/Vehicles

 

 

163,969

 

 

 

-

 

Computer Equipment

 

 

26,256

 

 

 

5,798

 

 

 

 

4,525,959

 

 

 

150,002

 

Accumulated depreciation

 

 

(104,707 )

 

 

(14,296 )

 

 

$ 4,421,252

 

 

$ 135,706

 

 

Depreciation expense for the year ended July 31, 2019 and 2018 was $93,426 and $15,050, respectively.

 

During the year ended July 31, 2019 and 2018, the Company acquired property and equipment of $4,375,957 and $152,287, respectively.

 

NOTE 4. INTANGIBLE ASSET - DIGITAL CURRENCY

 

During the year ended July 31, 2019, the Company issued 9,078,998 shares of common stock at a per-share price of $0.54, paid for with digital currency valued at $4,878,440.

 

During the year ended July 31, 2018, the Company issued 269,838 shares of common stock at a per-share price of $5.00, paid for with digital currency valued at $1,348,920.

 

During the year ended July 31, 2019, the Company sold a total of 1,200 Bitcoins, recorded as Intangible Asset - Digital Currency, for a total of $9,458,242, recognizing gain on sales of digital currency of $3,230,882.

 

As of July 31, 2019 and 2018, the Company had digital currency of $0 and $1,348,920, respectively.

 

Digital currencies are nonfinancial assets that lack physical substance. We believe that digital currencies meet the definition of indefinite-lived intangible assets.

 

 
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Table of Contents

 

NOTE 5. RELATED PARTY TRANSACTIONS (RESTATED)

    

Notes due to related parties

 

On September 30, 2017, the Company issued a note payable in the amount of $152,973 to Toga Capital Sdn. Bhd. (“Toga Capital”), which is partially owned by an officer and director of the Company, for repayment of amounts due to related parties of $152,973. The promissory note bears interest at a rate of 2% and had a maturity day of September 30, 2018. During the year ended July 31, 2018, the Company issued 1,533,552 shares of common stock with a fair value of $2,453,683 to repay the aggregate outstanding principal amount of $152,973 and accrued interest of $383 due pursuant to the promissory note. As a result, the Company recorded a loss on settlement of debt of $2,300,327.

 

On May 31, 2016, all outstanding related party advances were paid by a current director of the Company. The Company had outstanding a note payable due to related party who was a director of the Company, of $24,126 and $24,126 as of July 31, 2019 and July 31, 2018, respectively. The amount was non-interest bearing, unsecured and due on demand.

 

Due to related parties

 

During the years ended July 31, 2019 and 2018, the Company borrowed a total amount of $0 and $434,355, respectively, from Toga Capital, a related party, and repaid $183,339 and $49,036, respectively.

 

During the years ended July 31, 2019 and 2018, total expenses paid directly by Toga Capital, a related party, on behalf of the Company were $0 and $48,679, respectively.

 

During the years ended July 31, 2019 and 2018, the Company borrowed a total amount of $0 and $0, respectively, and repaid $1,968 and $0, respectively, from the Chief Executive Officer of the Company.

 

During the years ended July 31, 2019 and 2018, the Company purchased property and equipment of $0 and $25,218, respectively, from related parties.

 

As of July 31, 2019 and 2018, $1,083 and $186,390, respectively, was due to a related party. The amount was non-interest bearing, unsecured and due on demand.

 

Related party compensation

 

During the years ended July 31, 2019 and 2018, the Company incurred director’s fees of $9,000 and $0, respectively, to directors of the Company.

 

During the years ended July 31, 2019 and 2018, the Company incurred wages of $66,000 and $0, respectively, to the Chief Financial Officer of the Company.

 

During the year ended July 31, 2019, the Company granted stock options to purchase up to 120,000 shares of common stock to the Company’s directors and Chief Financial Officer, with an aggregate value of $1,061,017. See Note 6 for additional information.

 

During the year ended July 31, 2019, the Company issued 113,530 shares of common stock as stock-based compensation to the Chief Executive Officer of the Company valued at $1,033,899.

 

Related party stock purchases

 

During the years ended July 31, 2019 and 2018, Agel purchased common stock of the Company for cash as disclosed in Note 6. 

 

During the year ended July 31, 2019, Agel purchased 8,792,900 shares of common stock for $2,732,642 of digital currency.

 

Related party revenue

 

During the year ended July 31, 2018, the Company generated advertising revenue of approximately $0.1 million and management fee revenue of approximately $0.5 million from Agel.

 

During the year ended July 31, 2019, the Company generated advertising revenue of approximately $0.2 million, information technology fee revenue of approximately $0.1 million, and management fee revenue of approximately $1.3 million from Agel.

 

NOTE 6. EQUITY

 

Amendment to Articles of Incorporation and 10-1 Reverse Split

 

On May 8, 2019, the Company filed a Certificate of Amendment with the Nevada Secretary of State whereby it amended Article IV of its Articles of Incorporation by decreasing the Company’s authorized number of shares of common stock from 10,000,000,000 shares to 1,000,000,000 shares and decreasing its issued and outstanding shares of common stock at a ratio of 10 shares for every 1 share held. See Note 1 for additional information. All share and per share information in these consolidated financial statements retroactively reflect the 10-1 Reverse Split.

 

 
F-14

Table of Contents

 

Preferred stock

 

As of July 31, 2019, the Company was authorized to issue 20,000,000 shares of preferred stock at a par value of $0.0001.

 

As of July 31, 2019 and 2018, no preferred shares were issued and outstanding.

 

Common stock

 

As of July 31, 2019, the Company was authorized to issue 1,000,000,000 shares of common stock at a par value of $0.0001.

 

During the year ended July 31, 2019, the Company issued 21,196,376 shares of common stock, as follows:

 

 

·

10,490,362 shares of common stock for cash of $2,098,073 to Agel, who was a related party, at a price of $0.20 per share;

 

 

 

 

·

9,078,998 shares of common stock issued for $4,878,440 of digital currency (see Note 4 for additional information);

 

 

 

 

·

1,156,539 shares of common stock issued valued at $10,015,674 for employee compensation; and

 

 

 

 

·

470,477 shares of common stock issued for the acquisition of real properties valued at $3,999,054.

 

On October 29, 2018, a stockholder of the Company returned 20,000 shares of common stock for cancellation without consideration for such cancellation.

 

During the year ended July 31, 2018, the Company issued 14,951,047 shares of common stock, as follows:

 

 

·

8,402,929 shares of common stock for $842,209 to Toga Capital, a company that was partially owned by an officer and director of the Company, at a price of $0.10 per share;

 

·

1,533,552 shares of common stock with a fair value of $2,453,683 as settlement of a note payable due to a related party of aggregate principal of $152,973 and accrued interest of $383;

 

·

2,388,277 shares of common stock with a fair value of $11,221,067 as settlement of due to a related party of $238,828;

 

·

2,356,451 shares of common stock for $471,290 to Agel at a price of $0.20 per share; and

 

·

269,838 shares of common stock at $5.00 per share for digital currency valued at $1,348,920.

 

On July 6, 2018, three majority stockholders of the Company returned a total of 2,000,000,000 shares of common stock for cancellation without consideration for such cancellation.

 

As of July 31, 2019 and 2018, 90,762,893 and 69,586,517 shares of the Company’s common stock were issued and outstanding, respectively.

 

Stock Options

 

During the year ended July 31, 2019, the Company granted options to purchase up to 120,000 shares of common stock to the Company’s Chief Financial Officer. One-half of the option shares, or 60,000 shares, had an exercise price of $0.20 and the other one-half of the option shares, or 60,000 shares, had an exercise price of $0.40. The options were valued at the fair value calculated using the Black-Scholes-Merton model. The value of the options was $1,061,017 and recorded as stock-based compensation. The options are subject to a vesting schedule of one-third of the option shares vesting every thirty (30) days.

 

No stock options were issued during the year ended July 31, 2018.

 

The following assumptions were used to determine the fair value for the options granted using a Black-Scholes-Merton pricing model during the year ended July 31, 2019:

 

 

 

For the year

ended
July 31, 2019

 

Fair values

 

$

8.46-9.22

 

Exercise price

 

$

0.20-0.40

 

Expected term at issuance

 

2years

 

Expected average volatility

 

260.11-300.53

%

Expected dividend yield

 

 

 

Risk-free interest rate

 

2.31-2.56

%

 

 
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Table of Contents

 

A summary of the change in stock options outstanding for the year ended July 31, 2019 is as follows:

 

 

 

 

 

 

 

 

 

Average

 

 

 

 

 

Weighted

 

 

Weighted

 

 

Remaining

 

 

 

 

 

Average

 

 

Average

 

 

Contractual

 

 

 

Options

 

 

Exercise

 

 

Grant Date

 

 

Life

 

 

 

Outstanding

 

 

Price

 

 

Fair Value

 

 

(Years)

 

Balance – July 31 2018

 

 

-

 

 

$ -

 

 

$ -

 

 

 

-

 

Options issued

 

 

120,000

 

 

$ 0.30

 

 

$ 8.84

 

 

 

1.75

 

Options expired

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Options exercised

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Balance – July 31, 2019

 

 

120,000

 

 

$ 0.30

 

 

$ 8.84

 

 

 

1.75

 

 

NOTE 7. INCOME TAXES (RESTATED)

 

The Company recognizes deferred income tax liabilities and assets for the expected future tax consequences of events that have been recognized in the financial statements or tax returns. Under this method, deferred tax liabilities and assets are determined based on the differences between the financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. The Company has not incurred any income tax liabilities due to accumulated net losses. The Company operates in various tax jurisdictions, and accordingly, its income is subject to varying rates of tax.

 

For the fiscal year ended July 31, 2019, no taxable income was generated. All tax years since fiscal year ended 2012, are open for review. The Company had a net loss of $10,212,214 for the year ended July 31, 2019 and $13,620,308 for the same period in 2018. As of July 31, 2019, the Company’s net operating loss carry forward was approximately $3,000,000, which will begin to expire in year 2036.

 

On December 22, 2017, the United States enacted the Tax Cuts and Jobs Act (the “Act”) resulting in significant modifications to existing law. The Company has completed the accounting for the effects of the Act during the quarter ended July 31, 2018. The Company’s financial statements for the year ended July 31, 2018 reflect certain effects of the Act which includes a reduction in the corporate tax rate from 35% to 21%, Malaysia’s corporate tax rate of 24%, Indonesia’s corporate tax rate of 25%, as well as other changes.

 

The components of income tax expense benefit are as follows:

 

 

 

Years Ended

 

 

 

July 31,

 

 

 

2019

 

 

2018

 

 

 

 

 

 

 

 

US Federal

 

$ -

 

 

$ -

 

State

 

 

-

 

 

 

-

 

Foreign taxes

 

 

155,520

 

 

 

-

 

Total

 

$ 155,520

 

 

$ -

 

  

The reconciliation of income tax expense at the blended U.S. statutory rate of 21%, to the Company’s effective tax rate is as follows:

 

 

 

Years Ended

 

 

 

July 31,

 

 

 

2019

 

 

2018

 

Federal income tax benefit attributable to:

 

 

 

 

 

 

Net loss (benefit) at Federal Statutory rate (21% for 2019)

 

$ 2,810,122

 

 

$ 3,677,000

 

Non-deductible expenses

 

 

(2,326,105 )

 

 

(3,586,000 )

Foreign taxes

 

 

(61,215 )

 

 

-

 

State taxes

 

 

-

 

 

 

-

 

Effect of change in statutory rate

 

 

-

 

 

 

(98,200 )

Change in valuation allowance

 

 

(267,282

)

 

 

7,200

 

Total tax provision

 

$

155,520

 

 

$ -

 

 

There were no significant foreign tax losses or income to date.

 

 
F-16

Table of Contents

 

The significant components of deferred tax assets are as follows:

 

 

 

July 31,

 

 

July 31,

 

 

 

2019

 

 

2018

 

 

 

 

 

 

 

 

Net operating loss carryforwards at tax rates in effect at period end

 

$ 649,402

 

 

$ 226,600

 

Less: valuation allowance

 

 

(649,402 )

 

 

(226,600 )

Total deferred tax asset

 

$ -

 

 

$ -

 

 

NOTE 8. OTHER INCOME

 

Other income for the year ended July 31, 2019 was $0, and $205,748 for the year ended July 31, 2018. Other income of $205,748 for the year ended July 31, 2018 was generated through real estate commissions.

 

NOTE 9. SEGMENTED DISCLOSURE (RESTATED)

 

The following table shows operating activities information by geographic segment for the year ended July 31, 2019 and 2018:

 

Year Ended July 31, 2019

 

USA

 

 

Malaysia

 

 

Taiwan

 

 

Vietnam

 

 

Indonesia

 

 

Total

 

Revenue

 

$ 240,000

 

 

$ 1,356,336

 

 

$ 1,673,781

 

 

$ -

 

 

$ 2,618,117

 

 

$ 5,888,234

 

Cost of goods sold

 

 

-

 

 

 

1,353,412

 

 

 

142,417

 

 

 

-

 

 

 

233,919

 

 

 

1,729,748

 

Gross profit

 

 

240,000

 

 

 

2,924

 

 

 

1,531,364

 

 

 

-

 

 

 

2,384,198

 

 

 

4,158,486

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

 

41,374

 

 

 

760,918

 

 

 

1,015,200

 

 

 

8,666

 

 

 

1,357,062

 

 

 

3,183,220

 

Salaries and wages

 

 

11,076,691

 

 

 

1,686,638

 

 

 

206,914

 

 

 

-

 

 

 

104,474

 

 

 

13,074,717

 

Professional fees

 

 

907,546

 

 

 

158,173

 

 

 

15,424

 

 

 

71

 

 

 

29,022

 

 

 

1,110,236

 

Depreciation

 

 

-

 

 

 

73,330

 

 

 

6,910

 

 

 

-

 

 

 

13,186

 

 

 

93,426

 

Total Operating Expenses

 

 

12,025,611

 

 

 

2,679,059

 

 

 

1,244,448

 

 

 

8,737

 

 

 

1,503,744

 

 

 

17,461,599

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOSS FROM OPERATIONS

 

 

(11,785,611 )

 

 

(2,676,135 )

 

 

286,916

 

 

 

(8,737 )

 

 

880,454

 

 

 

(13,303,113 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE)

 

 

3,232,306

 

 

 

9,917

 

 

 

653

 

 

 

-

 

 

 

3,543

 

 

 

3,246,419

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss before Income Taxes

 

 

(8,553,305 )

 

 

(2,666,218 )

 

 

287,569

 

 

 

(8,737 )

 

 

883,997

 

 

 

(10,056,694 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax Provision

 

 

-

 

 

 

(155,520 )

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(155,520 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

$ (8,553,305 )

 

$ (2,821,738 )

 

$ 287,569

 

 

$ (8,737 )

 

$ 883,997

 

 

$ (10,212,214 )

 

During the year ended July 31, 2019, the Indonesia segment generated advertising revenue through the social media apps and direct marketing network sales of approximately $0.2 million and $2.4 million, respectively.

 

During the year ended July 31, 2019, the Malaysia segment generated advertising revenue of approximately $0.2 million, information technology fee revenue of approximately $0.1 million, and management fee revenue from Agel of approximately $1.1 million.

 

 
F-17

Table of Contents

 

During the year ended July 31, 2019, the Taiwan segment generated revenue through the direct marketing network sales of approximately $1.7 million.

 

During the year ended July 31, 2019, the U.S.A. segment recognized management fee revenue of approximately $0.2 million from Agel.

 

During the year ended July 31, 2019, the Malaysia segment incurred general administrative expenses primarily related to maintenance of applications, corporate overhead, financial and administrative contracted services, professional fees, salaries and wages, legal fees for reorganization of the Company and costs incurred for potential acquisitions.

 

During the year ended July 31, 2019, the U.S.A segment incurred stock-based compensation from the issuance of shares of common stock for employee compensation.

 

During the year ended July 31, 2019, the Malaysia segment incurred research and development expenses.

 

During the year ended July 31, 2019, the U.S.A. segment incurred other income from gain on sale of intangible assets.

 

Year Ended July 31, 2018

 

USA

 

 

Malaysia

 

 

Taiwan

 

 

Indonesia

 

 

Total

 

Revenue

 

$ -

 

 

$ 1,225,149

 

 

$ 29,346

 

 

$ -

 

 

$ 1,254,495

 

Cost of goods sold

 

 

-

 

 

 

143,760

 

 

 

2,087

 

 

 

-

 

 

 

145,847

 

Gross profit

 

 

-

 

 

 

1,081,389

 

 

 

27,259

 

 

 

-

 

 

 

1,108,648

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

 

329,360

 

 

 

330,080

 

 

 

24,738

 

 

 

41,838

 

 

 

726,016

 

Salaries and wages

 

 

-

 

 

 

455,246

 

 

 

-

 

 

 

12,375

 

 

 

467,621

 

Professional fees

 

 

313,639

 

 

 

114,308

 

 

 

794

 

 

 

14,327

 

 

 

443,068

 

Depreciation

 

 

 

 

 

 

7,622

 

 

 

865

 

 

 

6,563

 

 

 

15,050

 

Total Operating Expenses

 

 

642,999

 

 

 

907,256

 

 

 

26,397

 

 

 

75,103

 

 

 

1,651,755

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOSS FROM OPERATIONS

 

 

(642,999 )

 

 

174,133

 

 

 

862

 

 

 

(75,103 )

 

 

(543,107 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE)

 

 

(13,210,449

)

 

 

133,248

 

 

 

-

 

 

 

-

 

 

 

(13,077,201

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss before Income Taxes

 

 

(13,853,448

)

 

 

307,381

 

 

 

862

 

 

 

(75,103 )

 

 

(13,620,308

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

$

(13,853,448

)

 

$ 307,381

 

 

$ 862

 

 

$ (75,103 )

 

$

(13,620,308

)

 

During the year ended July 31, 2018, the Malaysia segment generated advertising revenue of approximately $0.1 million, information technology fee revenue of approximately $0.6 million and management fee revenue of approximately $0.5 million from Agel.

 

During the year ended July 31, 2018, the Malaysia and U.S.A. segments incurred general administrative expenses primarily related to maintenance of applications, corporate overhead, financial and administrative contracted services, professional fees, salaries and wages, legal fees for reorganization of the Company and costs incurred for potential acquisitions.

 

During the year ended July 31, 2018, the U.S.A. segment incurred other expenses mainly related to loss on settlement of debt.

 

 
F-18

Table of Contents

 

The following table shows assets information by geographic segment at July 31, 2019 and 2018:

 

Year Ended July 31, 2019

 

USA

 

 

Malaysia

 

 

Taiwan

 

 

Vietnam

 

 

Indonesia

 

 

Total

 

Current assets

 

$ 9,618,099

 

 

$ 1,874,078

 

 

$ 1,016,412

 

 

$ 35,531

 

 

$ 6,577,335

 

 

$ 19,121,455

 

Property and equipment

 

 

-

 

 

 

4,357,148

 

 

 

18,251

 

 

 

-

 

 

 

45,853

 

 

 

4,421,252

 

Intangible asset - digital currency

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Intangible asset - goodwill

 

 

-

 

 

 

11,718

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

11,718

 

Deposit

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Total assets

 

$ 9,618,099

 

 

$ 6,242,944

 

 

$ 1,034,663

 

 

$ 35,531

 

 

$ 6,623,188

 

 

$ 23,554,425

 

 

As of July 31, 2019, our USA parent company has current assets of $9.6 million primarily includes cash and cash equivalents of $9.5 million.

 

As of July 31, 2019, our Malaysian entities have current assets of $1.9 million primarily includes cash and cash equivalents of $1.2 million, prepaid expenses of $222,000 and accounts receivable of $194,000.

 

As of July 31, 2019, our Taiwan entity has current assets of $1.0 million primarily includes cash and cash equivalent of $820,000 and inventory of $140,000.

 

As of July 31, 2019, our Indonesian entities have current assets of $6.6 million primarily includes cash and cash equivalents of $2.8 million, inventory of $507,000 and prepaid expenses of $3.0 million.

 

As of July 31, 2019, our Malaysian entities have property and equipment of $4.4 million including land and building of $4 million, automobile of $151,000, leasehold improvement of $109,000 and tolls and equipment of $64,000.

 

Year Ended July 31, 2018

 

USA

 

 

Malaysia

 

 

Taiwan

 

 

Indonesia

 

 

Total

 

Current assets

 

$ 333,098

 

 

$ 722,354

 

 

$ 375,179

 

 

$ 27,917

 

 

$ 1,458,548

 

Property and equipment

 

 

-

 

 

 

86,073

 

 

 

10,294

 

 

 

39,339

 

 

 

135,706

 

Intangible asset - digital currency

 

 

1,348,920

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,348,920

 

Deposit

 

 

-

 

 

 

9,780

 

 

 

-

 

 

 

-

 

 

 

9,780

 

Total assets

 

$ 1,682,018

 

 

$ 818,207

 

 

$ 385,473

 

 

$ 67,256

 

 

$ 2,952,954

 

 

As of July 31, 2018, the U.S.A. segment had current assets of $333,000, which primarily included cash and cash equivalents of $313,000.

 

As of July 31, 2018, the Malaysia segment had current assets of $722,000, which primarily included cash and cash equivalents of $445,000 and accounts receivable of $344,000.

 

As of July 31, 2018, the Taiwan segment had current assets of $357,000, which primarily included cash and cash equivalents of $306,000.

 

As of July 31, 2018, the U.S.A. segment had intangible assets valued at $1.3 million.

 

NOTE 10 - RESTATEMENT OF FINANCIAL STATEMENTS

 

The Company's financial statements as of July 31, 2019, contained the following errors: (i) overstatement of revenue of $2,959,714 and cost of goods sold of $44,730 and general and administrative expenses of $2,503,269 and (ii) understatement of prepaid commission of $2,547,999 and deferred revenue of $2,959,714.

 

Certain income statement items have been reclassified to conform to the 2020 fiscal year end presentation. These reclassifications had no impact on reported operating and net loss.

 

 
F-19

Table of Contents

 

The effects of the adjustments on the Company’s previously issued financial statements as of July 31, 2019 and for the year ended July 31, 2019 are summarized as follows:

 

 

 

Originally

 

 

 

 

 

Restatement

 

 

As

 

ASSETS

 

Reported

 

 

Reclassification

 

 

Adjustment

 

 

Restated

 

Current Assets

 

 

 

 

 

 

 

 

 

 

 

 

Prepaid expense and other current assets

 

$ 1,199,649

 

 

$ -

 

 

$ 2,547,999

 

 

$ 3,747,648

 

Total Current Assets

 

 

16,573,456

 

 

 

-

 

 

 

2,547,999

 

 

 

19,121,455

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$ 21,006,426

 

 

$ -

 

 

$ 2,547,999

 

 

$ 23,554,425

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deferred revenue

 

$ 1,782,252

 

 

$

 

 

$ 2,959,693

 

 

$ 4,741,945

 

Income tax payable

 

 

61,215

 

 

 

(8,574 )

 

 

-

 

 

 

52,641

 

Total Current Liabilities

 

 

6,090,089

 

 

 

(8,574 )

 

 

2,959,693

 

 

 

9,041,208

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deferred tax liabilities

 

 

-

 

 

 

8,574

 

 

 

 

 

 

 

8,574

 

Total Liabilities

 

 

6,090,089

 

 

 

-

 

 

 

2,959,693

 

 

 

9,049,782

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated deficit

 

 

(24,093,611 )

 

 

-

 

 

 

(528,430 )

 

 

(24,622,041 )

Total Stockholders’ equity of Toga Ltd,

 

 

14,974,705

 

 

 

-

 

 

 

(528,430 )

 

 

14,446,275

 

Non-controlling interest

 

 

(58,368 )

 

 

-

 

 

 

116,736

 

 

 

58,368

 

Total Stockholders’ equity

 

 

14,916,337

 

 

 

-

 

 

 

(411,694 )

 

 

14,504,643

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$ 21,006,426

 

 

$ -

 

 

$ 2,547,999

 

 

$ 23,554,425

 

 

Year Ended July 31, 2019

 

Originally

 

 

 

 

 

Restatement

 

 

As

 

 

 

Reported

 

 

Reclassification

 

 

Adjustment

 

 

Restated

 

Revenue

 

$ 8,847,927

 

 

$ -

 

 

$ (2,959,693 )

 

$ 5,888,234

 

Cost of goods sold

 

 

5,857,806

 

 

 

(4,083,328 )

 

 

(44,730 )

 

 

1,729,748

 

Gross profit

 

 

2,990,121

 

 

 

4,083,328

 

 

 

(2,914,963 )

 

 

4,158,486

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

 

14,972,525

 

 

 

(9,286,036 )

 

 

(2,503,269 )

 

 

3,183,220

 

Salaries and wages

 

 

-

 

 

 

13,074,717

 

 

 

-

 

 

 

13,074,717

 

Professional fees

 

 

-

 

 

 

1,110,236

 

 

 

-

 

 

 

1,110,236

 

Research and development

 

 

815,589

 

 

 

(815,589 )

 

 

-

 

 

 

-

 

Depreciation

 

 

93,426

 

 

 

-

 

 

 

-

 

 

 

93,426

 

Total Operating Expenses

 

 

15,881,540

 

 

 

4,083,328

 

 

 

(2,503,269 )

 

 

17,461,599

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOSS FROM OPERATIONS

 

 

(12,891,419 )

 

 

-

 

 

 

(411,694 )

 

 

(13,303,113 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss before Income Taxes

 

 

(9,645,000 )

 

 

-

 

 

 

(411,694 )

 

 

(10,056,694 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET LOSS

 

$ (9,800,520 )

 

$ -

 

 

$ (411,694 )

 

$ (10,212,214 )

Add: Net gain (loss) attributable to non-controlling interest

 

 

(58,368 )

 

 

-

 

 

 

116,736

 

 

 

58,368

 

Net loss attributable to Toga ltd.

 

$ (9,742,152 )

 

$ -

 

 

$ (528,430 )

 

$ (10,270,582 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BASIC AND DILUTED NET LOSS PER COMMON SHARE:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING

 

 

82,842,852

 

 

 

-

 

 

 

-

 

 

 

82,842,852

 

NET LOSS PER COMMON SHARE

 

$ (0.12 )

 

$ -

 

 

$ (0.01 )

 

$ (0.12 )

 

 

 

Originally

 

 

Restatement

 

 

As

 

 

 

Reported

 

 

Adjustment

 

 

Restated

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

 

 

 

Net loss

 

$ (9,800,520 )

 

$ (411,694 )

 

$ (10,212,214 )

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Prepaid expenses and other current assets

 

 

(1,173,691 )

 

 

(2,547,999 )

 

 

(3,721,690 )

Deferred revenue

 

 

1,761,752

 

 

 

2,959,693

 

 

 

4,721,445

 

Net cash used in operating activities

 

$ 2,729,719

 

 

$ -

 

 

$ 2,729,719

 

 

 
F-20

Table of Contents

 

NOTE 11. SUBSEQUENT EVENTS

 

The Company has evaluated subsequent events through June 12, 2020, the date the original Form 10-K Amendment No. 1 was filed with the Secruties Exchange Commission.

 

On September 9, 2019, the Company issued 20,000 shares of common stock to Agel Enterprises. This issuance was to correct a transaction where 20,000 shares were transferred to certain shareholders by Agel and subsequently cancelled by Agel. The shares should have been returned to Agel but were inadvertently returned to the Company.

 

As of September 6, 2019, the Company moved it U.S.–based headquarters from Las Vegas, Nevada to Irvine, California. The Company has leased an office at 2757 McCabe Way, Suite 100, Irvine, California 92614.

 

As of October 1, 2019, the Company was approved and upgraded to OTCQX Best Market.

 

On November 7, 2019, the Company issued a total of 253,039 shares of its common stock to twenty-seven (27) of its employees, pursuant to an Employee Stock Bonus Agreement. Pursuant to the terms of such agreement, said shares were fully vested as of July 15, 2019.

 

On June 11, 2019, 24,614 common shares were issued to employees through clerical errors. Subsequent to July 31, 2019, the shares were cancelled.

 

 
F-21

Table of Contents

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  Toga Limited
       
Date: February 5, 2021 By: /s/ Toh Kok Soon

 

 

Toh Kok Soon  
   

President & Chief Executive Officer

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

/s/ Toh Kok Soon

 

February 5, 2021

 

/s/ Alexander Henderson.

 

February 5, 2021

Toh Kok Soon

 

 

 

Alexander Henderson

 

 

President & Chief Executive Officer, and a Director

(Principal Executive Officer)

 

 

 

Chief Financial Officer and Director

(Principal Financial Officer)

 

 

 

 

 

 

/s/ Iain Bratt

 

February 5, 2021

 

/s/ Jim Lupkin

 

February 5, 2021

Iain Bratt

 

 

 

Jim Lupkin

 

 

Director

 

 

 

Director

 

 

 

 

 

 

/s/ Shemori BoShae Guinn

 

February 5, 2021

 

 

 

 

Shemori BoShae Guinn

 

 

 

 

 

 

Director

 

 

 

 

 

 

 

 
S-1

 

EXHIBIT 4.1

 

DESCRIPTION OF THE REGISTRANT’S SECURITIES REGISTERED PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

 

The following is a summary of all material characteristics of the capital stock of Toga Limited, a Nevada corporation (“Toga,” the “Company,” “we,” “us,” or “our”) as set forth in our Amended and Restated Articles of Incorporation, as amended (the “Articles of Incorporation”) and our Amended and Restated Bylaws, as further amended (the “Bylaws”), and as registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of January 27, 2021.

 

The summary does not purport to be complete and is qualified in its entirety by reference to our Articles of Incorporation and our Bylaws, each of which are incorporated by reference as exhibits to the Annual Report on Form 10-K of which this Exhibit 4.1 is a part, and to the provisions of the Nevada Revised Statutes (the “NRS”). We encourage you to review complete copies of our Articles of Incorporation and our Bylaws, and the applicable provisions of the NRS for additional information.

 

General

 

Our authorized capital stock consists of 1,020,000,000 shares, divided into 1,000,000,000 shares of common stock, par value $0.0001 per share (the “Common Stock”), and 20,000,000 shares of preferred stock, par value $0.0001 per share (the “Preferred Stock”). Under our Articles of Incorporation, our board of directors (our “Board”) has the authority to issue such shares of Common Stock and Preferred Stock in one or more classes or series, with such voting powers, designations, preferences and relative, participating, optional or other special rights, if any, and such qualifications, limitations or restrictions thereof, if any, as shall be provided for in a resolution or resolutions adopted by our Board and filed as designations.

 

Common Stock

 

Of the 1,000,000,000 shares of Common Stock authorized in our Articles of Incorporation, our Board has designated 500,000,000 shares as Class A voting common stock, par value $0.0001 per share (the “Class A Common Stock”). As of January 28, 2021, 91,013,640 shares of our Class A Common Stock were outstanding. Our Board has designated the remaining 500,000,000 shares of Common Stock authorized in our Articles of Incorporation as Class B non-voting Common Stock, par value $0.0001 per share (the “Class B Common Stock”). As of January 27, 2021, no shares of our Class B Common Stock were outstanding.

 

Holders of our Class A Common Stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders, including the election of directors. Holders of our Class B Common Stock do not have the right to vote except as may be required by the NRS. Each holder of Common Stock is entitled to receive dividends when and as declared by our Board out of funds legally available therefore for distribution to stockholders and to share ratably in the assets legally available for distribution to stockholders in the event of the liquidation or dissolution, whether voluntary or involuntary, of Toga. We have not paid any dividends and do not anticipate paying any dividends on our Common Stock in the foreseeable future. It is our present policy to retain earnings, if any, for use in the development of our business. Holders of our Common Stock do not have cumulative voting rights in the election of directors and have no preemptive, subscription, or conversion rights. Our Common Stock is not subject to redemption by us.

 

 
1

 

 

As of January 28, 2021, we have reserved 12,461 shares of our Class A Common Stock for issuance upon the exercise of outstanding stock options, and 10,000,000 shares of our Class A Common Stock for issuance under our Amended and Restated Long-Term Incentive Plan.

 

The transfer agent and registrar for our Common Stock is Action Stock Transfer Corp.

 

Preferred Stock

 

Of the 20,000,000 shares of Preferred Stock authorized, our Board has not designated any shares and all 20,000,000 shares remain available for designation by our Board. Accordingly, our Board is empowered, without stockholder approval, to issue Preferred Stock with dividend, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights of the holders of Common Stock. The issuance of Preferred Stock could have the effect of restricting dividends on the Common Stock, diluting the voting power of the Class A Common Stock, impairing the liquidation rights of the Common Stock, or delaying or preventing a change in control of us, all without further action by our stockholders.

 

Certain Provisions of our Articles of Incorporation, our Bylaws, and the NRS

 

Certain provisions in our Articles of Incorporation and Bylaws, as well as certain provisions of the NRS, may be deemed to have an anti-takeover effect and may delay, deter, or prevent a tender offer or takeover attempt that a stockholder might consider to be in its best interests, including attempts that might result in a premium being paid over the market price of the shares held by stockholders. These provisions contained in our Articles of Incorporation and Bylaws include the items described below.

 

 

·

Staggered Board. Our Bylaws provide that beginning at our next annual meeting, our Board is to be divided into three classes, as nearly equal in number as possible, with directors in each class serving three-year terms. Provisions of this type may serve to delay or prevent an acquisition of us or a change in our directors and officers.

 

·

Special Meetings of Stockholders. Our Bylaws provide that special meetings of our stockholders may be called only by the Chairman of the Board, Chief Executive Officer, President, or a majority of our Board, thereby eliminating the right of stockholders to call a special meeting.

 

·

Stockholder Advance Notice Procedures. Our Bylaws provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide timely notice in writing and also specify requirements as to the form and content of a stockholder’s notice. These provisions may delay or preclude stockholders from bringing matters before a meeting of our stockholders or from making nominations for directors at a meeting of stockholders, which could delay or deter takeover attempts or changes in our management.

 

·

No Cumulative Voting. Our Articles of Incorporation do not include a provision for cumulative voting for directors. Under cumulative voting, a minority stockholder holding a sufficient percentage of a class of stock could be able to ensure the election of one or more directors.

 

·

Exclusive Forum. Our Bylaws provide that unless we consent in writing to the selection of an alternative forum, the courts located in the county of Los Angeles, California, or the Eighth Judicial District Court of Clark County, Nevada, is, to the fullest extent permitted by applicable law, the sole and exclusive forum for any claims, including claims in the right of the Company, brought by a stockholder (i) that are based upon a violation of a duty by a current or former director or officer or stockholder in such capacity; (ii) arising pursuant to any provision of NRS Chapters 78 or 92A or any provision of the Articles of Incorporation or the Bylaws; (iii) interpreting, applying, enforcing, or determining the validity of the Articles of Incorporation or the Bylaws; or (iv) that are governed by the internal affairs doctrine.

 

 
2

 

 

 

·

Undesignated Preferred Stock. Because our Board has the power to establish the preferences and rights of the shares of any additional series of Preferred Stock, it may afford holders of any Preferred Stock preferences, powers, and rights, including voting and dividend rights, senior to the rights of holders of our Common Stock, which could adversely affect the holders of our Common Stock and could discourage a takeover of us even if a change of control of Toga would be beneficial to the interests of our stockholders.

 

·

Action without a Meeting. Except as otherwise set forth in the Articles of Incorporation, no action shall be taken by the stockholders, except at an annual or special meeting of stockholders called and noticed in the manner required by the Bylaws, and no action may be taken by written consent in lieu of a meeting.

 

·

Amending the Bylaws. Our Bylaws provide that certain sections of the Bylaws (including provisions governing calling and providing notices for annual stockholder meetings, the staggered Board and how Board vacancies can be filled) all require the affirmative vote of the holders of at least sixty-six and two thirds percent (66 2/3%) of the outstanding voting power of the Corporation to be amended.

 

These and other provisions contained in our Articles of Incorporation and Bylaws are expected to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our Board. However, these provisions could delay or discourage transactions involving an actual or potential change in control of us, including transactions in which stockholders might otherwise receive a premium for their shares over then current prices. Such provisions could also limit the ability of stockholders to remove current management or approve transactions that stockholders may deem to be in their best interests.

 

In addition, we are subject to Section 78.438 of the NRS. This provision prohibits a Nevada corporation from engaging in a “combination” with an “interested stockholder” of the corporation for two years after the person first became an interested stockholder, unless the combination is approved in a prescribed manner.

 

Under Section 78.438, a combination between a corporation and an interested stockholder is prohibited unless the combination meets all the requirements of the articles of incorporation and it satisfies one of the following conditions:

  

 

·

The combination or the transaction by which the person first became an interest stockholder is approved by the board of directors of the corporation before the person first became an interested stockholder; or

 

·

The combination is approved by the board of directors of the corporation and, at or after that time, the combination is approved at an annual or special meeting of the stockholders of the corporation, and not by written consent, by the affirmative vote of the holders of stock representing at least 60% of the outstanding voting power of the corporation not beneficially owned by the interested stockholder, its affiliates, or its associates.

   

A “combination” includes, among other things, a merger, asset or stock sale or other transaction resulting in a 5% voting interest in the interested stockholder. An “interested stockholder” is a person who, together with its affiliates and associates, owns, or did own within two years prior to the determination of interested stockholder status, 10% or more of the corporation’s voting stock.

 

The NRS permits a corporation to opt out of, or choose not to be governed by, its anti-takeover statute by expressly stating so in its articles of incorporation. The Articles of Incorporation do not contain a provision expressly opting out of the application of Section 78.438 of the NRS; therefore, we are subject to the anti-takeover statute.

 

 
3

 

EXHIBIT 10.05

 

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 10.06

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 10.07

 

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

Exhibit 10.16

 

[FORM OF] TOGA LIMITED SCIENTIFIC ADVISORY COUNCIL MEMBER AGREEMENT

 

This TOGA LIMITED SCIENTIFIC ADVISORY COUNCIL AGREEMENT ("Agreement") is made as of this ______ day of ____________________, 20__ by and between TOGA LIMITED, a company incorporated with limited liability under the laws of the United States of America and have its registered office at 3960 Howard Hughes Parkway, suite 500, Las Vegas, Nevada 89169 (“TOGA”), and ___________________________ (“Council Member”).

 

WHEREAS,

 

TOGA is an online business conducting operations via its online store at www.togalimited.com since 2016

 

TOGA is a company that emphasizes network innovations, research and development.  It has a new online platform with integrated social messaging app for finance, tourism, trade and transaction, games, technology and software development. 

 

TOGA has established a Scientific Advisory Council (“Council”) with the Council Members’ collaboration, developing TOGA’s next-tier product strategy, product development and global brand positioning as related to wellness, lifestyle and healthy aging products for future offerings to TOGA’s customers.

 

TOGA desires to appoint _______________________________ as a Council Member and said Council Member is agreeable to the appointment and to render services to TOGA as set forth in this Agreement.

 

IT IS HEREBY AGREED AS FOLLOWS:

 

1.

Services (“Services”) of Council Member

 

 

1.1

To become a participating member of TOGA’s Scientific Advisory Council.

 

 

 

 

1.2

To collaborate with TOGA on the key functions of the Board, including but not limited to, the following services listed in Sections 1.2 and 1.3, limited to no more than 30 (thirty) hours of services per month. Any additional hours put in, must be preapproved.

 

 

 

 

1.3

Provide scientific product ideas and further provide advice regarding new, unique and exclusive breakthroughs in technologies relating to energy, lifestyle and nutrition wellness.

 

 

 

 

1.4

At TOGA’s request, and with consideration to Council Member’s schedule:

 

 

(a)

to attend and deliver keynote speeches regarding wellness, lifestyle and healthy aging in major TOGA events;

 

 

 

 

(b)

to contribute by writing articles to TOGA’s online or printed materials and/or other media outlets regarding wellness, lifestyle and healthy aging as TOGA’s Scientific Advisory Council Member;

 

 
1

 

 

 

(c)

to attend special meetings or assign any other persons to facilitate TOGA’s lifestyle/wellness products;

 

 

 

 

(d)

to answer to blogs, customer enquiries via our Global Support Center where participation is needed; and

 

 

 

 

(e)

to endorse products of interest, attend ad hoc public relation events in our top performing regions, to be part of TOGA official videos and commercials if requested.

 

2.

Term

 

 

2.1

The Council Member shall provide Services as set out in Paragraph 1 above for a period of twelve (12) months commencing from the _______ day of _______________, 20__, unless terminated earlier in accordance with Paragraph 4 of this Agreement.

 

3.

TOGA’s Obligations

 

 

3.1

In return for the Services provided by the Council Member to TOGA under this Agreement, and provided that the Council Member duly performs his or her duties, TOGA shall pay the Council Member the amount of USD $_______ per annum (the “Council Member Fee”) for the Term of this Agreement. An additional payment of USD $_______ shall be paid for each and every additional keynote presentation (“Keynote Fee”) referred to above in Paragraph 1.3(a) by Council Member at TOGA.

 

 

 

 

3.2

The Council Member Fee will be paid via telegraphic transfer as follows:

 

 

(a)

Payment of a consultancy retainer each month equal to 1/12 (one-twelfth) of the total amount of the Board Member Fee per annum, to be received by Council Member on or before the 7th (seventh) day of each month for each month of Services rendered.

 

 

 

 

(b)

Payment of each Keynote Fee within 30 (thirty) days immediately following each keynote presentation.

 

 

 

 

(c)

All payments will be made in USD by electronic transfer or bank wire directly into Council Member’s checking account in the United States of America. The council member's bank account details is as stated below:

 

 

 

 

 

_____________________________________

 

 

_____________________________________

 

 

_____________________________________

 

 

_____________________________________

 

 

3.3

The payments stated herein are inclusive of all value added tax and/or withholding tax.

 

 

 

 

3.4

Travel Expenses for Council Member will be handled as follows:

 

 
2

 

 

 

(a)

Council Member will be invited to meet with the TOGA’s executive team including the TOGA’s representative who signs this Agreement at the TOGA’s Headquarters in Asia according to the terms stated in Paragraph 3.4(b) below.

 

 

 

 

(b)

Travel expenses for Council Member to visit TOGA, to make appearances and keynote presentations at TOGA annual events, and to conduct other business with TOGA, will be booked by TOGA and pre-paid by TOGA.

 

 

 

 

(c)

All international air travel for Council Member will be Business Class.

 

 

 

 

(d)

Hotel bookings, hotel lodging, and ground transportation at the travel destinations will be pre-arranged and pre-paid by TOGA.

 

 

 

 

(e)

If any other travel expenses are incurred in relation to the performance of the Council Member’s Services, including costs incurred for air ticket, ground transportation, lodging and other relevant expenses (but not including per diem), the Council Member shall be entitled for reimbursement by TOGA, provided that (i) prior written approval by Mr. Michael Toh, CEO of TOGA is obtained by the Council Member for the Council Member’s travel plans and the travel related expenses, and (ii) the Council Member shall provide TOGA a summary of travel expenses reimbursement including official receipt and/or invoice for said incurred expenses.

 

 

3.5

TOGA shall make the requisite payment(s) as stipulated in the relevant preceding paragraphs within 30 (thirty) days of receiving travel receipts and invoices by a mode that it considers to be most expedient or by a mode as may be agreed by the Parties.

 

4.

Termination

 

 

4.1

Either Party hereto shall have the right to terminate this Agreement at any time upon 30 (thirty) days prior written notice to the other Party.

 

 

 

 

4.2

Unless required by law to do so, the Council Member shall not use nor disclose any Confidential Information concerning TOGA or any of its customers or clients to any person other than for the purposes of TOGA. The provisions of this Paragraph 4.2 shall survive the termination of this Agreement.

 

5.

Confidentiality/Confidential Information

 

 

5.1

The Council Member is not to divulge to anyone, either during or after the term of this Agreement, any Confidential Information obtained or developed by the Council Member during the term of this Agreement.

 

 

 

 

5.2

Upon the expiration or earlier termination of this Agreement, the Council Member agrees to deliver to TOGA all documents, papers, drawings, tabulations, reports and similar documentation that are furnished by TOGA to the Council Member or were prepared by the Council Member in performance of the Services for TOGA. Upon the expiration or termination of this Agreement, the Council Member agrees to make no further use or utilization of any Confidential Information. The provisions of this Paragraph 5 shall survive the termination of this Agreement.

 

 
3

 

 

6.

Assignment

 

 

6.1

Neither Party shall assign, transfer, subcontract or sublicense any of its rights or obligations under this Agreement without the other Party’s written consent.

 

7.

Waiver

 

 

7.1

No failure or delay by either Party in exercising any right, power or privilege under this Agreement shall operate as a waiver thereof or acceptance of any variation of this Agreement.

 

8.

Severability

 

 

8.1

In the event of any one or more provisions contained in this Agreement being held, for any reason, to be unenforceable, invalid or illegal:

 

 

(a)

it shall not affect any other provisions of this Agreement;

 

 

 

 

(b)

this Agreement shall be construed as if such provisions had not been contained therein; and

 

 

 

 

(c)

the Parties shall negotiate in good faith to replace any such provision as has effect nearest to that of the provision being replaced.

 

9.

Force Majeure

 

 

9.1

Each of the Parties to this Agreement shall be exempted from any responsibility for its violation if such a violation is a consequence of any force-majeure circumstances that have arisen after the conclusion hereof as a result of events of extraordinary nature which the parties could neither foresee nor prevent by applying reasonable measures. Force-majeure circumstances refers to any events, upon which the parties cannot exert any influence such as, without limitation: earthquake, flood, fire, hurricane, rebellion, civil disorder, strike, acts of authorities and hostilities of any nature impeding the performance under this Agreement.

 

 

 

 

9.2

If any force-majeure circumstances or consequences continue in force for more than 1 (one) month, the Parties shall conduct additional negotiations to reveal any alternative methods of performing this Agreement.

 

10.

Relationship of the Parties

 

 

10.1

Nothing in this Agreement shall be construed as constituting a partnership, agency or joint venture between the Parties hereto.

 

 
4

 

 

11.

Notices

 

 

11.1

Any notice required to be given under this Agreement shall be in writing and shall be sent to the other party by post or personal delivery at the addresses set out above in this Agreement.

 

12.

Entire Agreement

 

 

12.1

This Agreement shall constitute the entire Agreement between the Parties for the Scientific Advisory Council Membership and shall be binding upon the successors and assignees of the Parties hereto. This Agreement supersedes any previous Agreements, written or oral, between the Parties. No variation of this Agreement shall be effective unless agreed in writing by the Parties. In addition, through additional written agreements, TOGA may contract the Council Member for services that go beyond the scope of Services of the Scientific Advisory Council, including, but not limited to:

 

 

(a)

conducting original scientific studies and clinical trials on products;

 

 

 

 

(b)

introducing new products and wholesales of such products or product components to TOGA; and

 

 

 

 

(c)

services, including payment of legal fees, toward obtaining external bodies decisions on TOGA products, including, but not limited to, compliance clearances and/or approvals.

 

13.

Governing Law and Jurisdiction

 

 

13.1

This Agreement shall be governed by and construed in accordance with the laws of the State of Nevada and the United States of America, and the Courts of Nevada and the United States of America are to have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement.

 

AS WITNESSED, the Parties hereto or their duly authorized representatives hereby acknowledge the terms and conditions of this Agreement by executing below on the day and year first above written.

 

TOGA LIMITED

 

Council Member

 

 

 

 

 

Signed by

 

Signed by:

 

 

 

 

 

 

 

 

 

 

 

 

 

Duly authorized for and on behalf of

 

Print name_______________________

 

TOGA Limited

 

 

 

 

 

Date Signed_________________, 20__

 

Print name_______________________

 

 

 

Date Signed_________________, 20__

 

 

 

 

 
5

 

EXHIBIT 10.17

 

TOGA LIMITED

 

SUBSCRIPTION AGREEMENT

Dated: May 7, 2018

 

The Securities have not been registered under U.S. Securities Act of 1933 (the "U.S. Securities Act") or any state securities laws and may not be offered or sold in the United States or to U.S. persons unless the securities are registered under U.S. Securities Act, or an exemption from the registration requirements of U.S. Securities Act is available. Hedging transactions involving the Securities may not be conducted unless in compliance with the U.S. Securities Act.

 

TO:

TOGA LIMITED

 

The undersigned (the "Purchaser") hereby agrees to subscribe for and purchase from Toga Limited, a corporation incorporated under the laws of the State of Delaware (the "Company") on the terms and conditions set forth in this Subscription Agreement (this "Subscription Agreement") up to 1,076,752,423 shares of the Company’s common stock, par value $0.0001 per share (the “Offered Shares”) (hereinafter referred to as the “Shares” or the “Securities”), at a subscription price of US$0.02 per Share, for an aggregate purchase price of up to TWENTY-ONE MILLION FIVE HUNDRED THIRTY FIVE THOUSAND FORTY-EIGHT AND 46/100 US Dollars (USD$21,535,048.46) (the “Purchase Price”). The actual number of Offered Shares to be purchased hereunder shall be at the Purchaser’s sole discretion, subject to the terms hereof. The Offered Shares may be purchased only up to and through May 7 , 2018. The Purchaser may purchase any portion of the Offered Shares in such amounts and at such time as determined by the Purchaser, subject to the terms hereof.

 

The Purchaser understands that the Shares are being offered and issued only pursuant to a certain exemption from registration requirements under U.S. securities laws and pursuant to certain representations and warranties provided herein by the Purchaser to US Persons (as such term is defined in Schedule A attached hereto).

 

1. CONDITIONS OF PURCHASE

 

The Purchaser acknowledges and agrees that the Company's obligation to sell the Securities to the Purchaser is subject to, among other things, the following conditions:

 

 

(a)

that the Purchaser executes and returns to the Company this Subscription Agreement (including Schedule "A" which is incorporated herein by reference) and all documents required by applicable securities legislation for delivery on behalf of the Purchaser and the aggregate Purchase Price;

 

 

 

 

(b)

that the issue, sale and delivery of the Securities is exempt from all registration requirements and the requirements to file a prospectus or registration statement, or deliver an offering memorandum under applicable securities legislation relating to the sale of the Securities in each of the applicable jurisdictions, or that the Company has received such orders, consents, or approvals as may be required to permit such sale without the requirement of filing a prospectus or registration statement, or delivering an offering memorandum or complying with the registration requirements;

 

 
1

 

 

 

(c)

for each traunche of Shares to be purchased hereunder, the Purchaser shall provide the Company written notice of its election to purchase a certain number of Shares (the "Election to Purchase Notice") and complete, execute and deliver the documents referred to in Section 2 of this Subscription Agreement;

 

 

 

 

(d)

all documentation relating to the offer, sale and issuance of the Securities being in form and substance satisfactory to the Company; and

 

 

 

 

(e)

that the representations and warranties of the Purchaser contained in this Subscription Agreement (including Schedule "A" attached hereto) remain true and correct as of the Closing Date.

 

The Purchaser acknowledges that its subscription for Securities is subject to acceptance or rejection, in whole or in part, by the Company at any time before the Closing, and the availability of Offered Shares.

 

2. DELIVERY, PAYMENT AND ESCROW

 

The Purchaser agrees that the following will be delivered to the Company contemporaneously with the Elections to Purchase Notice provided by the Purchaser, to the Company:

 

 

(a)

payment of the Purchase Price for such number of Offered Shares set forth in the Election Notice to be purchased by wire transfer to the Company utilizing the instructions set forth on Schedule "B" attached hereto; and

 

 

 

 

(b)

all other documentation as may be required by applicable securities legislation.

 

The closing of each sale of Securities pursuant to each Election to Purchase Notice (the "Closing") shall be effected, subject to the satisfaction of all of the conditions of purchase set forth in Section 1 of this Subscription Agreement upon receipt of all of the items described in subparagraphs (a) through (b) above.

 

At Closing, the Company shall deliver certificates representing the Securities and payment for the Securities will be completed at the Closing.

 

3. PURCHASER'S ACKNOWLEDGEMENTS

 

The Purchaser acknowledges (on its own behalf and, if applicable, on behalf of those for whom the Purchaser is contracting hereunder, and for greater certainty, any reference to the Purchaser in this Subscription Agreement includes any such beneficial purchaser for whom the Purchaser is purchasing hereunder) that:

 

 

(a)

AN INVESTMENT IN THE SECURITIES IS NOT WITHOUT RISK AND THE PURCHASER MAY LOSE HIS, HER OR ITS ENTIRE INVESTMENT;

 

 

 

 

(b)

the Company may complete additional, and existing, financings in the future in order to develop the business of the Company and fund its ongoing development, and such future financings may have a dilutive effect on current shareholders of the Company, including the Purchaser;

 

 
2

 

 

 

(c)

the Company has the right to accept the Purchaser's subscription and purchase in whole or in part or not at all;

 

 

 

 

(d)

the Purchaser has not been provided with, nor has it requested, nor does it have any need to receive, an offering memorandum or any similar document in connection with its subscription for the Securities, and its decision to execute this Subscription Agreement and to purchase the Securities has been based entirely upon publicly available information concerning the Company and not upon any verbal or other written representation as to fact or otherwise made by or on behalf of the Company or any employees, agents or affiliates thereof;

 

 

 

 

(e)

the Securities have not been registered under the U.S. Securities Act of 1933 (the "U.S. Securities Act") or the securities laws of any state, and that the Securities upon issuance will be, "restricted securities" in the United States within the meaning of Rule 144(a)(3) of the U.S. Securities Act;

 

 

 

 

(f)

no agency, governmental authority, regulatory body, stock exchange or other entity has made any finding or determination as to the merit for investment of, nor have any such agencies or governmental authorities made any recommendation or endorsement with respect to the Securities or the offering of the Securities (the "Offering");

 

 

 

 

(g)

the purchase of the Securities has not been made through, or as a result of, and the distribution of the Securities is not being accompanied by, and the Purchaser is not aware of, any form of general solicitation or general advertising including advertisements, articles, notices or other communications published in any newspaper, magazine or similar media, or broadcast over radio, internet or television, or any seminar or meeting whose attendees have been invited by general solicitation or general advertising;

 

 

 

 

(h)

the Securities are being offered for sale on a "private placement" basis only;

 

 

 

 

(i)

the issuance, sale and delivery of the Securities to the Purchaser or (if applicable) to any purchaser on whose behalf it is contracting hereunder, is conditional upon such issuances and sales being exempt from the registration requirements and the prospectus requirements, or the requirement to file a registration statement, of all applicable securities legislation relating to the issuance and sale of Securities, or upon the issuance of such orders, consents or approvals as may be required to permit such sales without the requirement of filing a prospectus or complying with the registration requirements;

 

 

 

 

(j)

the Company may be required to disclose to applicable securities regulatory authorities the identity of the beneficial purchasers of the Securities;

 

 

 

 

(k)

upon the issuance of the Securities, the certificates representing the Securities shall bear a legend to the effect that transfer is prohibited for a minimum period of one (1) year after the purchase of the Securities, and thereafter that transfer is prohibited except (i) in accordance with the provisions of Regulation S under the U.S. Securities Act, (ii) pursuant to registration under U.S. Securities Act, or (iii) pursuant to an available exemption from registration; and that hedging transactions involving those securities may not be conducted unless in compliance with U.S. Securities Act;

 

 
3

 

  

 

(I)

the Securities will be subject to resale restrictions under applicable securities legislation, rules, regulations and policies, and the Purchaser or (if applicable) others for whom it is contracting hereunder will comply with all relevant securities legislation, rules, regulations and policies concerning any Securities and will consult with its own legal advisers with respect to complying with all restrictions applying to any such resale and further agrees that it, or (if applicable) others for whom it is contracting, is solely responsible for compliance with all applicable resale restrictions and will only resell the Securities in compliance with all applicable securities laws;

 

 

 

 

(m)

the Offering is only being made to persons to whom it may be lawfully made and the Securities issued and sold without breach of any applicable securities legislation;

 

 

 

 

(n)

it has been given the opportunity by the Company to ask questions of, and receive answers from, the management of the Company and has had access to such financial and other information concerning the Company as it has considered necessary to make a decision to invest in the Securities and has availed itself of such opportunity to the full extend desired; and

 

 

 

 

(o)

that even though Purchaser has subscribed for the Shares, Purchaser may not be able to purchase the Shares if another purchaser (or purchasers) have previously paid for all of the Offered Shares (whether or not such purchasers delivered their subscription for Offered Shares to the Company before or after Purchaser).

   

4. PURCHASER'S REPRESENTATIONS, WARRANTIES AND COVENANTS

 

The Purchaser hereby acknowledges and agrees with, represents and warrants to, and covenants with, the Company (which representations, warranties and covenants will survive Closing) on its own behalf and on behalf of others for whom it is contracting hereunder, that:

 

 

(a)

the Purchaser (and each beneficial purchaser for whom it is acting) is purchasing the Securities as principal for its own account, not for the benefit of any other person (other than any disclosed principal disclosed to the Company) and not with a view to the resale, distribution or other disposition of all or any of the Securities, and it is not a resident of the United States and by virtue thereof is a "non-U.S. person" as defined in Regulation S under the U. S. Securities Act (and as set forth in Schedule "A" attached hereto, which is incorporated herein in its entirety), and confirms that the purchase of the Securities by the Purchaser is not in violation of any applicable laws of its jurisdiction of residence, and Purchaser hereby makes the statements set forth in Schedule "A" attached to this Agreement indicating the means by which Purchaser is a "non-U.S. Person" and confirms the truth and accuracy of all statements made by Purchaser in Schedule "A";

 

 

 

 

(b)

it consents to the Company making a notation on its records or g1vmg instructions to any transfer agent of the Securities in order to implement the restriction on transfer set forth and described herein;

  

 
4

 

 

 

(c)

it (and any beneficial purchaser for whom it is acting) understands that an investment in the Company includes a high degree of risk, has such knowledge and experience in financial and business matters, investments, securities and private placements as to be capable of evaluating the merits and risks of its investment in the Securities, is in a financial position to hold the Securities for an indefinite period of time, and is able to bear the economic risk of, and withstand a complete loss of such investment in the Securities;

 

 

 

 

(d)

it (and if the Purchaser is acting as agent for a disclosed principal, such disclosed principal) was offered the Securities in, and is resident in, the jurisdiction outside of the United States disclosed to the Company, and intends that the securities law of that jurisdiction govern the Purchaser's subscription;

 

 

 

 

(e)

it (and any beneficial purchaser for whom it is acting) has been independently advised as to, and is aware of, the restrictions with respect to trading in the Securities pursuant to the applicable securities laws and the rules of any applicable stock exchanges and further agrees that it (and any beneficial purchaser for whom it is acting) is solely responsible for compliance with all such restrictions;

 

 

 

 

(f)

if required by applicable securities laws or order of a securities regulatory authority, stock exchange or other regulatory authority, it will execute, deliver, file and otherwise assist the Company in filing such reports, undertakings and other documents with respect to the issuance of the Securities;

 

 

 

 

(g)

if it is an individual, the Purchaser has attained the age of majority and in every case the Purchaser is legally competent and has the legal capacity to purchase the Securities and to execute the Subscription Agreement and take all actions required pursuant to this Subscription Agreement;

 

 

 

 

(h)

if the Purchaser is a corporation, the Purchaser is a valid and subsisting corporation, has the necessary corporate power, capacity and authority to execute and deliver this Subscription Agreement and to observe and perform its covenants and obligations hereunder and has taken all necessary corporate action in respect thereof and has obtained all necessary approvals in respect thereof or, if the Purchaser is a partnership, syndicate or other form of unincorporated organization, the Purchaser has the necessary legal power, capacity and authority to execute and deliver this Subscription Agreement and to observe and perform its covenants and obligations hereunder and has taken all necessary action in respect thereof and has obtained all necessary approvals in respect thereof;

 

 

 

 

(i)

upon acceptance of this Subscription Agreement by the Company, this Subscription Agreement will constitute a legal, valid and binding obligation of the Purchaser (and any beneficial purchaser for whom it is acting), enforceable against the Purchaser (and any beneficial purchaser for whom it is acting) in accordance with its terms;

 

 
5

 

 

 

(j)

it has had the opportunity to review this Subscription Agreement and the Schedule attached hereto and the transactions contemplated by this Subscription Agreement and fully understands the same;

 

 

 

 

(k)

it (and if the Purchaser is acting as agent for a disclosed principal, such disclosed principal) is responsible for obtaining such legal, including tax, advice as it considers necessary or appropriate in connection with the execution, delivery and performance by it of this Subscription Agreement and the transactions contemplated herein;

 

 

 

 

(I)

the entering into of this Subscription Agreement and the transactions contemplated hereby will not result in a violation of any of the terms and provisions of any law applicable to the Purchaser or any beneficial purchaser for whom the Purchaser is acting as trustee or agent, or any of its corporate documents, or of any agreement, deed, order or judgment to which it is a party or by which it is bound;

 

 

 

 

(m)

it is solely responsible for its own due diligence investigation of the Company and its business, for its own analysis of the merits and risks of its investment in the Securities made pursuant to this Subscription Agreement and for its own analysis of the terms of its investment;

 

 

 

 

(n)

it is solely responsible for obtaining such advice concerning the tax consequences of its investment in the Securities and it is not relying on the Company or its counsel for advice concerning such tax consequences;

 

 

 

 

(o)

if the Purchaser is not an individual but is a corporation, syndicate, partnership, trust, association or any other form of unincorporated organization or organized group of persons, it has not been formed for the specific purpose of acquiring the Securities, nor created solely or used primarily to permit a group of persons to purchase the Securities, without a prospectus in reliance on a prospectus exemption or registration exemption;

 

 

 

 

(p)

the purchase of the Securities by the Purchaser hereunder is not a transaction in which any director or officer of the Company, or any beneficial owner of securities carrying more than 10% of the voting rights attaching to all outstanding voting securities of the Company, has a direct or indirect beneficial interest, unless the Purchaser has otherwise notified the Company;

 

 

 

 

(q)

the Purchaser (and each beneficial purchaser for whom it is acting) is acquiring the Securities to be held for investment only and not for the benefit of any other person (other than any disclosed principal disclosed to Company) and not with a view to resale, distribution or any other disposition of any or all of such Securities;

 

 

 

 

(r)

the Purchaser (and each beneficial purchaser for whom it is acting) shall hold the Securities and not offer, sell, or otherwise transfer any of the Securities for a minimum of one year after the purchase of the securities hereunder (the "Restrictive Period") regardless of any sorter period under applicable laws, rules or regulations;

  

 
6

 

 

 

(s)

after the expiration of the Restrictive Period, if it decides to offer, sell or otherwise transfer any of the Securities, the Purchaser will not offer, sell or otherwise transfer any of such Securities directly or indirectly, unless:

 

 

(i)

the sale is to the Company;

 

 

 

 

(ii)

the sale is made outside the United States in a transaction meeting the requirements of Regulation S under the U.S. Securities Act and in compliance with applicable local laws and regulations;

 

 

 

 

(iii)

the sale is made in the United States pursuant to the exemption from tile registration requirements under the U.S. Securities Act provided by Rule 144 (if it as available) thereunder and in accordance with any applicable state securities or "blue sky" laws, and the Purchaser has prior to such sale furnished to the Company an opinion of counsel reasonably satisfactory to the Company to the effect that such transaction does not require registration pursuant to Rule 144 under the U.S. Securities Act;

 

 

 

 

(iv)

the Securities are sold in the United States in a transaction that does not require registration under the U.S. Securities Act or any applicable state laws and regulations governing the offer and sale of securities, and the Purchaser has prior to such sale furnished to the Company an opinion of counsel reasonably satisfactory to the Company to the effect that such transaction does not require registration; or

 

 

 

 

(v)

the sale is made in the United States pursuant to an effective registration statement filed under the U.S. Securities Act.

 

The Purchaser acknowledges and agrees that the Company will refuse to register any sale of Securities made in breach of the provisions hereof.

 

 

(t)

all of the acknowledgements, representations, warranties and covenants set out in Schedule "A" hereto are true and correct as of the day hereof and as of the Closing and are incorporated by reference herein;

 

 

 

 

(u)

none of the funds being used to purchase the Securities are, to the knowledge of tt1e Purchaser, obtained or derived directly or indirectly as a result of illegal activities of Purchaser or of any beneficial purchaser for whom the Purchaser is acting; and

 

 

 

 

(v)

Purchaser shall provide to the Company (i) the Purchaser's street address, city, state or province, country, postal code, and phone number for the Purchaser, and, if the Purchaser is acting for a beneficial purchaser or disclosed principal, Purchaser shall provide such beneficial purchaser's or disclosed principal's full name, street address, city, state or province, country, postal code, and phone number; (ii) information requested by the Company regarding the registration of the certificates representing the Securities purchased hereunder; and (iii) any other information required by the Company, from time to time, regarding the Purchaser or such beneficial purchaser or disclosed principal.

 

 
7

 

  

5.   POWER OF ATTORNEY 

 

The Company is hereby irrevocably appointed as the Purchaser's agent and attorney to represent the Purchaser at the Closing for the purposes of all closing matters and deliveries of documents, including without limitation (i) the delivery of certificates representing the Securities; (ii) executing in the Purchaser's name and on its behalf all closing receipts and documents; and (iii) negotiating and settling documents related to the Offering including any opinions, certificates or other documents addressed to the Purchaser.

 

6. WAIVER

 

The Purchaser, and each beneficial purchaser, if any, for whom the Purchaser is acting, hereby waives and releases the Company from, to the fullest extent permitted by law, any and all rights of withdrawal, rescission or compensation for damages to which the Purchaser or such beneficial purchaser might otherwise be entitled under applicable securities legislation, rules, regulations and policies.

 

7. GOVERNING LAW

 

This Subscription Agreement will be governed by and construed in accordance with the laws of the State of Arizona and the federal laws of the U.S. applicable therein. The Purchaser, on its own behalf and (if applicable) on behalf of others for whom it is contracting hereunder, hereby irrevocably attorns to the exclusive jurisdiction of the courts of the State of Arizona with respect to any matters arising out of this Subscription Agreement.

 

8. ASSIGNMENT

 

This Subscription Agreement is not transferable or assignable by the parties hereto.

 

9. ENTIRE AGREEMENT

 

This Subscription Agreement (including the Schedule hereto) contains the entire agreement of the parties hereto relating to the subject matter hereof and there are no representations, covenants or other agreements relating to the subject matter hereof except as stated or referred to herein.

 

10. SURVIVAL AND ENUREMENT

 

The representations, warranties, acknowledgments and covenants contained in this Subscription Agreement and in the Schedule hereto are made by the Purchaser with the intent that they may be relied upon by the Company in determining the Purchaser's eligibility or the eligibility of any others on whose behalf the Purchaser is contracting hereunder to purchase the Securities, and the Purchaser hereby agrees to indemnify the Company (and its officers, directors, employees, advisors, legal counsel and agents of the Company) against all losses, claims, costs, expenses and damages or liabilities which they may suffer or incur that are caused by or arise from the Purchaser's breach thereof. The Purchaser further agrees that by accepting the Securities the Purchaser shall be representing and warranting that the representations, warranties and acknowledgements contained herein are true as at the Closing with the same force and effect as if they had been made by the Purchaser at the Closing and that they and the covenants set forth in this Subscription Agreement shall survive the purchase by the Purchaser of the Securities and shall continue in full force and effect notwithstanding any subsequent disposition by it of any or all of the Securities. With respect to any indemnified person who is not a party to this Subscription Agreement, it is the intention of the Purchaser to constitute the Company as trustee for such indemnified persons of the rights and benefits of this Section 10 and the Company agrees to accept such trust and to hold the rights and benefits of this Section 10 in trust for and on behalf of each such indemnified person.

 

This Subscription Agreement will be binding upon and enure to the benefit of the parties hereto and their respective successors and assigns.

 

 
8

 

 

11. CURRENCY

 

Except where otherwise expressly provided, all amounts in this Subscription Agreement are stated and will be paid in United States currency.

 

12. COSTS

 

All costs and expenses incurred by the Purchaser and any beneficial purchaser for whom it is acting as trustee or agent relating to its purchase of Shares shall be borne by the Purchaser.

 

13. TIME OF ESSENCE

 

Time will be of the essence of this Subscription Agreement.

 

14. HEADINGS

 

The headings contained herein are for convenience only and will not affect the meaning or interpretation of this Subscription Agreement.

 

15. SCHEDULE

 

The following Schedule is incorporated into and forms an integral part of this Subscription Agreement, and any reference to this Subscription Agreement includes the Schedule "A"- CERTIFICATE OF NON-U.S. PERSON.

 

16. EXECUTION BY FACSIMILE, COUNTERPARTS

 

The Company will be entitled to rely on delivery by facsimile or electronic mail of an executed copy of this Subscription Agreement, including any attachments hereto, and acceptance by the Company of such facsimile or electronic copy will be legally effective to create a valid and binding agreement between the Company and tt1e Purchaser in accordance with the terms hereof. This Subscription Agreement may be executed in counterparts, each of which shall be deemed to be an original and all of which shall constitute one and the same document.

 

(Intentionally left blank)

 

 
9

 

 

17. SUBSCRIPTION PARTICULARS

 

BOX A:

 

Particulars of Purchase of Shares

 

 

Number of Shares Subscribed For:

 

1,076,752,423 )

 

 

 

 

 

Total subscription price payable:

 

USD$21,535,048.46

 

(US$0.02 x number of Shares subscribed for)

 

 

 

 

BOX B:

 

Purchaser Information

 

 

 

 

Name of Purchaser:

 

Agel Enterprises International Sdn. Bhd.

 

 

 

 

 

Street Address:

 

B-1-15, Block B, 8th Avenue, Jalan Sg Jernih 811, Section 8

 

 

 

 

 

City and Province:

 

Petaling Jaya, Selangor

 

 

 

 

 

Country/Postal Code:

 

46050, Malaysia

 

 

 

 

 

Contact Name:

 

Caroline Ang

 

 

 

 

 

Alternate Contact:

 

Adeline

 

 

 

 

 

Phone No.:

 

603-7956-7609

 

 

 

 

 

Fax No.:

 

603-7956-7301

 

 

 

 

 

 

BOX C:

 

Registration Information

Registration of the certificates representing the Securities should be made exactly as follows:

 

 

 

 

Name of Purchaser:

 

Agel Enterprises International Sdn. Bhd.

 

 

 

 

 

Street Address:

 

B-1-15, Block B, 8th Avenue, Jalan Sg Jernih 811, Section 8

 

 

 

 

 

City and Province:

 

Petaling Jaya, Selangor

 

 

 

 

 

Country/Postal Code:

 

46050, Malaysia

 

 

 

 

 

Contact Name:

 

Caroline Ang

 

 

 

 

 

Alternate Contact:

 

Adeline

 

 

 

 

 

Phone No.:

 

603-7956-7609

 

 

 

 

 

Fax No.:

 

603-7956-7301

 

 

 

 

 

 

 
10

 

 

BOX D:

 

 

 

BOX E:

 

 

 
11

 

 

18. SIGNATURE OF PURCHASER

 

Signature of Purchaser (on its own behalf and, if applicable, on behalf of each principal for whom it is contracting hereunder).

 

AGEL ENTERPRISES INTERNATIONAL SON. BHD.

a Malaysian corporation

 

By: /s/ Khairul Razikin Bin Jamalludin

Name: Khairul Razikin Bin Jamalludin

Title: Director

 

 

19. CONFIRMATION AND ACCEPTANCE

 

This Subscription Agreement is confirmed and accepted by the Company.

 

DATED as of the 7th day of May, 2018.

 

TOGA LIMITED,

a Delaware  corporation

 

By:

/s/ Toh Kok Soon

 

Name:

Toh Kok Soon

 

Title:

CEO

 

 

 
12

 

 

SCHEDULE "A"

CERTIFICATE OF NON-U.S. PERSON

 

The Purchaser covenants, represents and warrants to Toga Limited (the "Company") that:

 

1. The representation and warranties contained herein are made by the Purchaser with the intent that they may be relied upon by the Company in determining the Purchaser's suitability as a purchaser of shares of its capital stock (the "Shares").

 

2. The Purchaser confirms that the purchase of the Shares occurred in an "offshore transaction" in that:

 

(a) The Purchaser is not an "entity" in the United States;

 

(b) At the time the Subscription Agreement between Purchaser and Company (the "Subscription Agreement") was entered into (which this Schedule "A" is a part), and as of the effective date of the Subscription Agreement, the Purchaser was outside of the United States;

 

(c) The Purchaser is not a U.S. Person. For purposes hereof, "U.S. Person" means:

 

 

(i)

any natural person resident in the United States;

 

(ii)

any partnership or corporation organized or incorporated under the laws of the United States;

 

(iii)

any estate of which any trustee is a U.S. Person;

 

(iv)

any trust of which any trustee is a U.S. Person;

 

(v)

any agency or branch of a foreign entity located in the United States;

 

(vi)

any non-discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary organized, incorporated, or (if any individual) resident in the United States; and

 

(vii)

any partnership or corporation if:

 

 

(a)

organized or incorporated under the laws of any foreign jurisdiction; and

 

(b)

formed by a U.S. Person principally for the purpose of investing in securities not registered under the U.S. Securities Act, unless it is organized or incorporated, and owned by accredited investors (as defined in Rule 501(1) under the U.S. Securities Act) who are not natural persons, estates or trusts.

 

 

A-1

 

 

3. The Purchaser has previously been advised that the Purchaser would have an opportunity to review all the pertinent facts concerning the Company, and to obtain any additional information which it might request, to the extent possible or obtainable, without unreasonable effort and expense.

 

4. The Purchaser has personally communicated or been offered the opportunity to communicate with an executive officer of the Company to discuss the business and financial affairs of the Company, its products and activities, and its plans for the future. The Purchaser acknowledges that if the Purchaser would like to further avail itself of the opportunity to ask additional questions of the Company, the Company will make arrangements for such an opportunity on request.

 

5. The Purchaser has been advised that no accountant or attorney engaged by the Company is acting as its representative, accountant, or attorney.

 

 

8th May 2018

 

 

Date

 

 

 

 

 

/s/ Khairul Razikin Bin Jamalludin

 

 

Duly Authorized Signatory for Purchaser

 

 

 

 

 

Khairul Razikin Bin Jamalludin

 

 

(Print Name of Purchaser)

 

   

 

A-2

 

EXHIBIT 10.18

 

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

Exhibit 10.19

 

SUBSCRIPTION TERMINATION AGREEMENT

 

THIS SUBSCRIPTION TERMINATION AGREEMENT (this "Agreement") is made and entered into as of this 31st day of May 2020 (the "Effective Date"), by and between Toga Limited, a Nevada corporation (the ''Company"), and Agel Enterprises International Sdn. Bhd., a Malaysian company ("Subscriber" and together with the Company, the "Parties'' and each, a ''Party").

 

WHEREAS, the Company and Subscriber are parties to that certain Amended and Restated Subscription Agreement, executed on May 4, 2019 (the '"Subscription Agreement"), pursuant to which Subscriber was to purchase, and the Company was to issue, up to 861,423,170 shares (the "Shares") of the Company 's common stock in exchange for a subscription price equal to the Market Price ('·Market Price" shall mean the five-day closing bid price of the Company 's common stock as quoted on OTC Markets during the five clay period immediately preceding delivery of the Purchaser's notice of its election to purchase any of the Offered Shares).

 

WHEREAS, the Company and Subscriber were parties to that certain original Subscription Agreement entered into on May 7, 2018 (the "Original Subscription Agreement") and subsequently amended and restated on or about May 4, 2019. Pursuant to this Original Subscription Agreement, the Company agreed to sell to Subscriber up to 1,076,752,423 shares (107,675,242 post June 2019 10: I reverse stock split) of its common stock at a price of USD$0.02 per share. Prior to amending and restating the Subscription Agreement, Subscriber purchased 215,329,253 shares (21,532,925 post June 2019 10:1 reverse stock split), leaving a total of up to 861,423,170 shares (86,142,317 post June 2019 10:1 reverse stock split) remaining to be purchased and offered in the Subscription Agreement.

 

WHEREAS, as of June 2019, Subscriber purchased 216,329,439 shares (21,632,944 post June 2019 l 0:1 reverse stock split) in exchange for payment in an aggregate amount of $5,302,006.09 of the Purchase Price;

 

WHEREAS, Subscriber did not purchase the balance of 860,422,984 Shares (86,042,298 post June 2019 10:1 reverse stock split) pursuant to the Subscription Agreement; and

 

WHEREAS, the Parties desire to terminate the Subscription Agreement and waive and relinquish all of their respective rights under the Subscription Agreement, on the te1ms and subject to the conditions set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the above recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties hereby agree as follows:

 

l. Termination of the Subscription Agreement. As of the Effective Date, the Subscription Agreement is hereby terminated subject to the tem1s and conditions of this Agreement. Each Party hereby waives and relinquishes any and all rights that such Party may have under the Subscription Agreement. The Subscription Agreement shall have no further force or effect from and after the Effective Date, and the rights of Subscriber with respect to the Shares shall terminate.

 

 
1

 

 

2. Severability. If any provision of this Agreement is declared by any court of competent jurisdiction to be invalid, void or unenforceable for any reason, that finding shall in no way affect any other provision of this Agreement or the validity or enforceability of this Agreement. Such remaining provisions shall be fully severable, and this Agreement shall be construed and enforced as if such invalid provision(s) had never been inserted in the Agreement.

 

3. Governing Law. This Agreement and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of Nevada, without giving effect to principles of conflicts of law.

 

4. Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

 

5. Amendment; Waiver. This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each Patty. No waiver by any Party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the Party so waiving.

 

6. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the Patties and their respective successors and permitted assigns.

 

7. Further Assurances. Each of the Parties shall, and shall cause its respective affiliates to, from time to time at the request, furnish the other Party such further information or assurances, execute and deliver such additional documents, instruments and conveyances, and take such other actions and do such other things, as may be reasonably necessary or desirable to can-y out the provisions of this Agreement and give effect to the transactions contemplated hereby.

 

8. Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall be deemed to constitute one instrument. Delivery of this Agreement by facsimile transmission or electronic mail shall be effective as delive1y of a manually executed counterpart hereof.

 

[SIGNATURE PAGE TO FOLLOW]

 

 
2

 

 

 

 
3

 

EXHIBIT 10.20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXHIBIT 10.21

 

 

 

 
 

 

 

 

 
 
 

EXHIBIT 10.22

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 10.23

 

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 10.24

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.25

 

Service Agreement

 

This is a Service Agreement (the "Agreement'') made on the I st day of January 2020. The Parties in this agreement are as follows:

 

Social Networking Association

and

Toga Limited

 

The Parties to this Agreement agree to the following:

 

Deliverable

 

Social Networking Association under the direction of Jim Lupkin, will present a ten-minute multi-media presentation that has been approved by Toga Limited at Toga Limited approved meetings using the Toga office in Orange County, California.

 

The meetings may be promoting a company, a product or a business opportunity that is in no way linked to Toga Limited.

 

The meetings held in the Toga office in Orange County, California will have no room rental or associated cost payable to Toga Limited for the use of its facilities, provided the ten-minute multi-media presentation is made at each meeting.

 

A register of each event will be kept containing attendee contact information: First name

 

Last name

Telephone number

Email address

 

A running total of attendee details will be maintained.

 

One thousand registered individuals will provide their contact information.

 

Remuneration

 

Part One

Toga Limited will make an initial and immediate payment of$10,000 (ten thousand US dollars) to the Social Networking Association's Bank account.

 

Account Name:

 

Social Networking Association

Account Number:

 

____________

Address:

 

7904 E CHAPARRAL RD 100-476 SCOITSDALE, AZ 85250

 

 

 

Bank Name:

 

Silicon Valley Bank

Routing Number:

 

____________

Bank Address:

 

80 E. Rio Salado Parkway Ste 600 Tempe, AZ 85281

 

 

 

 

Part Two

A second payment of$10,000 (ten thousand US dollars) will be made to Social Networking Association's Bank account on February 1st, 2020.

 

Part Three

A third payment of$10,000 (ten thousand US dollars) will be made to Social Networking Association's Bank account on March 1st, 2020.

 

Time Period

 

A period of 90 days, commencing January 2nd, 2020, and ending March 31 is allocated to reach the total of 1,000 individuals.

 

Accuracy

 

Social Networking Association will keep a true and fair copy of the names, phone numbers and email addresses of the individuals who receive the ten-minute multi-media presentation. Best efforts will be made to disallow obvious duplicate, inaccurate, false and fictitious names and details.

 

Office and Physical Facility

 

Toga Limited will permit the Social Networking Association to use the office and facility free of any charge or rent, specifically:

 

The Social Networking Association may use the office address as its registered office.

Toga Limited will assign two furnished internal offices for the exclusive use of the Social Networking Association, in addition to the use of the conference room, restrooms, kitchen and parking.

Toga Limited will erect internal signage to signify the residency of the Social Networking Association.

 

The address being:

 

2575 McCabe Way, Ste 100

Irvine, CA 92614

  

Amendments:

 

 

-

Amendments may be made hereto upon the unanimous and written consent of all Parties.

 

-

Amendments must expressly be written and have the original signatures of all Parties.

 

Settling Disputes:

 

All Parties agree to enter into mediation before filing suit against each other for any dispute arising from this agreement. Parties agree to attend one session of mediation before filing suit. If any Party does not attend mediation, or the dispute is not settled after one session of mediation, the Parties are free to file suit. Any lawsuits will be under the jurisdiction of the state of California.

 

 

 

 

All Parties signed hereto agree to the above stated Agreement.

 

Signed this 1st day of January 2020

 

Social Networking Association:

 

/s/ Jim Lupkin

 

(Signature)

 

 

 

 

 

Jim Lupkin - Executive Director of the Social Networking Association

 

 

 

Toga Limited:

 

 

 

 

 

(Signature)

 

 

 

 

 

Alex Henderson - CFO of Toga Limited

 

 

 

 

EXHIBIT 10.27

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.28

 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 10.29

 

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 10.30

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.31

 

 

 

 
 

 

 

 

 
 

 

 

EXHIBIT 10.32

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

EXHIBIT 10.33

 

Tenancy Agreement

Number:

00 / MS / LA / VI /2 019

 

This Tenancy Agreement (to hereafter called the " Agreement ”) was signed in Jakarta on today 's Monday on 24 June 20 19 ( 24-06-2019) by and between :

 

1.

 PT, C H ARNIC CAPI T AL Tbk , as a business unit of D Floor 8 Tower Sudirman domiciled at Menara Sudirman Floor 8 Jalan General Sudirman Plot 60 Jakarta 12190, in case these are represented by Bp. Anton Santoso as the President Director of PT. Charnic Capital Tbk . (For hereinafter called " Owners”).

 

 

2.

PT. TO GA INTERNA TI ONAL INDONESIA AND A which is domiciled in Asia Plaza, Floor 2 Jalan J enderal Sudirman Plot 59 Jakarta 12190, d a lam thing is that represented by Mrs. Cecilia Tjahjadi as General Manager of PT. T Oga International Indonesia (for hereinafter called " Tenant ").

  

(For further Owner and Tenant are collectively as “the Parties”).

 

The Parties up previously explained things as follows:

 

 

-

Whereas the owner has a building erected on a piece of land, on the 8th floor uhit D with proof of Certificate Number: 0201 / VII dated 23 December 1997 which is located on Jalan Jenderal Sudirman Kaveling 60 Jakarta, locally known as Menara Sudirman (hereinafter referred to as " Building "), and intends to rent out the rooms in it.

 

 

 

 

-

Whereas the Tenant intends to rent an area of 350 m2 (three hundred and fifty square meters) of space contained in the building, from the Owner and the Owner agreeing to lease the space to the Tenant.

  

Each of the Parties acts in their position as mentioned above, further agreeing to bind themselves in this Agreement, with the following terms and conditions:

 

Article 1

Lease Agreement

 

1.1

The owner hereby agrees to rent to the Tenants and the Tenants hereby agrees to rent from the Owner a room of 350 m (three hundred and fifty square meters) located on the 8th Floor Unit D Building, as will be further elaborated in attachment I which is an integral and inseparable part of this Agreement (hereinafter referred to as "Leases").

 

 

1.2

In this Agreement the Owner will give the Tenant the right to use jointly with the Owner, other tenants and people permitted by the Owner to enter the building, namely over lobbies, kitchens, toilets, corridors, alleys, stairs, runways and elevators (hereinafter called the "Joint Section ').

 

 
1

 

 

Article 2

Rent Time Period

 

2.1

The lease term under this Agreement is for 2 (two) years, which will start on August 1, 2019 (01-08-2019) and will end on July 31, 2021 (31-07-2021), (hereinafter referred to as "Rent time period").

 

 

2.2

Tenant hereby releases the Owner from any responsibility in connection with the delay of the Tenant to occupy the Rental Space for any reason, due to the Tenant's own fault. In this case, the delay will not affect the rental period as set out above.

 

 

2.3

If the Tenant intends to terminate the rental of the Rental Room before the end of the Rental Period, the Tenant must first pay all the obligations to pay the rental price, management fees (hereinafter referred to as "Service Charge") and other fees that must be paid by the Tenant according to the Agreement this, until the end of the Lease Period, or the Lessee must first find a replacement lessee that has been approved by the Owner.

  

Article 3

Facilities

 

3.1

During the Rental Period, except on Sundays and national holidays, from Monday to Friday from 7:00 WIB to 19:00 WIB for electricity, from 07:00 WIB to 18.00 WIB for AIR CONDITIONING. And for Saturdays from 07.00 WIB to 13.00 for air conditioning and from 07.00 to 13.00 for electricity. (hereinafter referred to as "Working Hours") The owner will provide the following facilities:

 

 

 

 

3.1.1

Electricity

 

 

a.

The rental room will be equipped with Volt ampere electric power from PT. State Electricity Company (Persero) which is channeled through the building manager. In addition, the building manager also provides a generator which will be operated at any time in the event of a power cut.

 

 

 

 

b.

The tenant must pay a fee, the amount of which will be determined by the building manager for electricity consumption and Air Conditioning according to the monthly electricity consumption meter.

  

 

3.1.2

Telephone

 

 

a.

In the Rental Room, the Tenant has arranged a direct telephone line connection to the Building Manager with the obligation to pay the cost of its usage directly to PT. Telkom (Persero).

 

 

 

 

b.

All telephone lines in the Rental Room originating from PT. Telkom (Persero) is the property of the Tenant, and the Tenant has the right to operate the telephone line connection during and / or at the end of the Lease Period to the building manager.

  

 

3.1.3

Water

 

 

 

 

 

Water will be provided by the building manager at certain places in the building that can be used jointly by tenants and owners.

 

 
2

 

 

 

3.1.4

Air-Conditioning (AC)

 

 

 

 

 

The rental room will be equipped with Central air conditioner which will function based on the existing floor in the building.

 

 

 

 

 

Building Managers are required to maintain the operation of the Air Conditioning (AC) system such as routine servicing and replacement of Freon as well as maintenance. However, it is a different matter for Air Conditioning (AC) because of the age of use that must be replaced, so the replacement of Air Conditioning (AC) is the responsibility of the owner through the building manager with the Central system.

 

 

 

 

3.1.5  

Parking

  

 

a.

The Building Manager provides a parking space and all vehicles must be parked in a parking space that has been provided in accordance with the parking rules and rates determined by the Building Manager.

 

 

 

 

b.

The building manager is not responsible for any damage or loss to the vehicle and / or parts of the vehicle and / or items in the vehicle that occur in the parking lot.

 

 

 

 

c.

Changes in parking rates will be notified in writing by the Building Management within 1 (one) month prior to the enactment of the new parking rates.

 

 

3.1.6

Elevator

 

 

 

 

The building management also provides 6 (six) high-speed main passenger lifts consisting of 3 (three) units for the low zone and 3 (three) for the high zone to be used jointly by Tenants, Owners and other guests.

 

 

 

 

3.1.7

Cleanliness

 

 

a.

The Building Manager will maintain the cleanliness of all public parts, viz include:

 

 

 

 

 

 

i

Entrances, corridors, lobbies, toilets, elevators, runways and stairs;

 

 

ii.

The exterior of the building includes poles, beams, windows, sunshades, front yards and curbs;

 

 

iii.

Car park, driveway.

 

 

 

 

 

b.

The tenant is obliged to be responsible for the cleanliness of the Rental Room and the inside of the windows in the Rental Room.

 

 

3.1.8

Wastewater disposal

 

 

 

 

The building management provides a facility for processing waste from toilets and dishwashers, which will then be distributed to a shelter provided by the local government.

 

 
3

 

 

 

3.1.9

Waste disposal

 

 

 

 

The building manager will prepare a special officer who will dispose of the Tenants' garbage every day outside the building.

 

 

 

 

3.1.10

Sanitary Equipment

 

 

 

 

The building manager will provide tissue paper and hand washing soap in each toilet in the building.

 

 

 

 

3.1.11

Maintenance

 

 

 

 

The building manager will always maintain and maintain the cleanliness of the building except in the rental room and carry out regular maintenance of the plants in the garden and inside the building.

 

 

 

 

3.1.12

Information section

 

 

 

 

Several people will be assigned by the Building Manager as receptionist in the main lobby to provide information services and car call.

 

 

 

 

3.1.13

Insurance

 

 

 

 

The premises and facilities provided by the Owner will be insured on a full replacement basis. The owner through the building manager will also ensure full responsibility in the event of injury or loss of life in the building or building yard, but not what happens in the lease room and the tenant hereby agrees to release the owner or building manager from the liability for injury or liability. loss of soul that occurs in the Rental Room.

 

 

 

 

3.1.14

Security

 

 

 

 

The Building Manager agrees to establish a security team that will be on duty 24 (twenty-four) hours a day to maintain security both inside and outside the building, but not included in the Rental Room.

 

 

 

 

3.1.15

Fire Management

 

 

 

 

The building manager will equip the building with an alarm and fire extinguisher.

  

3.2

For the purposes of providing facilities as referred to in articles 3.1.1, 3.1.3, 3.1.4, and 3.1.6 to 3.1.15, the Tenant will be subject to a Service Charge as regulated in article 4.2.

 

 

3.3

Damage to the facilities as regulated in articles 3.1.1 to 3.1.6, 3.1.8, 3.1.10 and 3.1.15 mentioned above may not be repaired by the Tenant and must be reported by the Tenant to the Building Manager for immediate repair by the Building Manager.

 

 

3.4

Repair costs for such damage will be borne by the Owner through the Reserved Fund which is paid to the Building Manager per month unless it is caused by the fault or carelessness of the Tenant and / or the Tenant's employees and / or the Tenant's guest, then the repair costs must be borne by the Tenant.

 

 
4

 

 

Article 4

Rental Price and Service Charge

 

4.1

During the Rental Period, the Tenant is required to pay the rental price for the Rental Room of Rp. 282,000 (Two hundred and eighty-two thousand Rupiah) per square meter per month.

 

 

4.2

In connection with the provision of facilities and services by the Building Manager as regulated in articles 3.1.1, 3.1.3, 3.1.4, and 3.1.6 to 3.1.15, Tenants are required to pay a Service Charge of Rp. 68,000 (sixty-eight thousand Rupiah) per square meter per month to be paid directly to the building manager.

 

 

4.3

The rental price is determined in Indonesian Rupiah. The rental price is paid at once for 2 (two) years in advance at the beginning of the rental period. Service Charge price is set in Rupiah currency. Service Charge prices are paid at the beginning of each month on the 1st (one).

 

 

4.4

The review of the Rental Price and Service Charge will be carried out at the time and in accordance with the conditions and terms in attachment II which is an integral and inseparable part of this Agreement.

 

Article 5

Rental Guarantee Deposits

 

5.1

At the time of signing this Agreement, the Tenant is obliged to pay a sum of money in the amount of payment of 3 (three) months Rental Price, namely Rp. 367,500,000 (Three hundred sixty-seven million five hundred thousand Rupiah as collateral for the implementation and fulfillment of the Charterers' obligations as determined in this Agreement (hereinafter referred to as "Rental Security").

 

 

5.2

Rental Security will be returned to the Tenant without any interest at the end of the Rental Period as soon as the Tenant vacates the Rental Room.

 

 

5.3

For the return of the Rental Guarantee, the Tenant must show the Owner for the payment of the Rent, Service Charge for the last 3 (three) months and other costs which are the obligations of the Charterer to the Owner under this Agreement.

 

 

5.4

If the Tenant still has arrears in payment obligations under this Agreement that has not been paid, then before it is returned to the Tenant the Owner has the right to reduce the Rental Guarantee, in accordance with the amount of arrears that has not been paid by the Tenant and return the excess to the Tenant. If the Lease Guarantee is insufficient, the Owner has the right to collect the deficiency of the outstanding payment obligations to the Tenant.

 

 
5

 

 

Article 6

Payment Methods and Fines

 

6.1

With due observance of the due date as set out in each payment obligation, payment of the Rental Price and other costs that must be paid by the Charterers to the Owner under this Agreement along with taxes and penalties must be made by transfer on Owner's account in Bank CIMB Niaga Menara Sudirman Branch no. account ________________ (Rupiah Account) or through other means as agreed by the Parties.

 

 

6.2

On each payment and receipt of a number of payments as referred to in article 6.1. from the Tenant to the Owner, the Owner will provide proof of payment in the form of an original receipt to the Tenant, if the deposit has entered the owner's account and the Tenant has been able to show proof of the original transfer deposit and a photocopy of it to the Owner.

 

 

6.3

If the Tenant is in arrears to pay the Rental Price, Service Charge, and other costs which are the obligations of the Tenant as set out in this Agreement, for a period of more than 30 (thirty) days, the Owner will impose a fine of 212% (two and a half). percent) per month of the unpaid payment, starting from the due date of the relevant payment to the date of settlement.

 

Article 7

Obligations and Don'ts for Tenants

 

7.1

During the Term of the Lease, the Tenant promises and binds himself to comply with and carry out the following obligations:

 

 

7.1.1.

Tenants are required to pay on time the Rental Price, Service Charge, taxes, fines, and other costs which are the obligations of the Tenant as stipulated in this Agreement.

 

 

 

 

7.1.2.

Tenants and their employees are obliged to pay attention to and implement the rules set by the Owner as described in attachment III which is an integral and inseparable part of this Agreement, and the Tenant is hereby deemed to have understood and know the restrictions and restrictions on the use of the Rental Space. .

 

 

 

 

7.1.3.

During the Rental Period, the Tenant will always maintain and maintain the Rental Room as befits a good Tenant, and return it at the end of the Rental Period in good condition as at the time of handover by the Owner to the Tenant, along with the objects at the time surrender from the Owner to the Tenant and the Tenant will make repairs for the damage to the Rental Room caused by the fault of the Tenant and / or his employees and / or his guests, except for the facilities as stipulated in articles 3.1.1 to 3.1. 6, 3.1.8, 3.1.10, and 3.1.15.

 

 

 

 

7.1.4.

At all times, Tenants are required to comply with all laws and regulations and other government regulations relating to Room Rentals.

 

 

 

 

7.1.5

Tenants are required to obtain and complete all permits for their business and the Charterers hereby release the Owner from all claims from other third parties resulting from the Charterer's negligence in completing these permits.

 

 

 

 

7.1.6.

Tenants are required to maintain calm in the environment around the Rental Room and prevent actions that can cause noise and disturbance to other Tenants.

 

 
6

 

 

 

7.1.7

Tenants are required to obtain prior written approval from the Owner to make changes to air conditioners. If desired by the Owner, the Tenant must revoke the additions or changes at the time of termination of the Agreement and return the Rental Room according to its original condition at the time of delivery from the Owner to the Tenant.

 

 

 

 

7.1.8.

Tenants are required to obtain prior written approval from the Owner, if they are to use the Rental Room for purposes other than office, administrative, educational and commercial purposes. But under any circumstances, the Rental Space may not be used for housing, warehousing, display or storage of goods as well as for purposes that are against the law or violate the norms of decency (immoral).

 

 

 

 

7.1.9.

The tenant is obliged to collect garbage in a condition that has been properly packed in a place that has been determined by the Owner to then be transported by a designated officer outside the building, provided that the Owner will not be responsible for any loss or damage to the property of the Tenant. caused by the implementation of garbage disposal by cleaning officers.

 

 

 

 

7.1.10.

The Tenant is obliged to allow the Owner or any person authorized by the Owner to enter the Rental Room with prior notification to the Tenant, to carry out cleaning, inspection, repair and changes which are the obligations of the Owner under this Agreement, or which are the obligations of the Tenant under this Agreement but the Tenant neglect it.

 

 

 

 

7.1.11.

Tenants are required to bear costs incurred in connection with repairs which are the obligations of the Tenants and Tenants are prohibited from interfering in the work

 

 

 

 

7.1.12.

Tenants are required to obtain permission from the Owner before installing signage, writing, advertising facilities or other special signs on a part of the building or rental space.

 

 

 

 

7.1.13.

At the time of the return of the Rental Room to the Owner, the Tenant is obliged to remove the name board, writing, advertising means or other special signs that are installed by the Tenant on a part of the Building or Rental Room and repair the damage caused by the activity at his own expense. If the Tenant neglects to carry out these obligations, the Owner will carry out the revocation and repair at the Charterer's expense.

 

 

 

 

7.1.14.

The Tenant will release the Owner and Tenant is obliged to provide compensation from and against all claims, cases and costs suffered and / or incurred by the Owner in connection with loss of life or injury or damage to property arising from or due to carelessness, negligence by the Tenant and / or Tenant employees and / or Tenant guests in the use of the Rental Room.

 

 

 

 

7.1.15.

The tenant will release the owner and tenant to provide compensation for all loss and / or damage to the rental room and / or to another part of the building caused by carelessness, misuse, misuse of tenants, and / or tenant employees, and / or Tenant's agents and / or Tenant guests for electrical installations and equipment, water and gas installations, air conditioning and firefighting equipment.

 

 
7

 

  

7.2

During the Rental Period, the Tenant is prohibited from doing the following actions:

 

 

7.2.1.

Except for business purposes, Tenants are prohibited from storing and / or using chemical materials in the form of gases or explosive liquids in the Rental Room. Tenants are also prohibited from storing firearms, ammunition, explosives, gasoline, kerosene, fuel or other dangerous materials in the Rental Room and the owner will not allow other parties to do so.

 

 

 

 

7.2.2

Tenants are prohibited from committing an act or action that may result in an increase in the building insurance premium or cause the cancellation or cancellation of the Building insurance policy.

 

Article 8

Separation Wall

 

Tenants are not allowed to install a dividing wall in the Rental Room, except in the following conditions:

 

8.1

The relevant dividing wall has been installed by the Owner and will remain the right of the Owner, where the Tenant must maintain and maintain the separation wall so that it is still in good condition and maintained at the time of handing back the Rental Room to the Owner.

 

 

8.2

Additions or changes to the dividing wall must comply with all applicable building requirements and regulations and comply with the standards regarding type and quality approved by the Owner and installed in the rental space approved by the Owner.

 

 

8.3

The cost of installing the separation wall, architectural and building consultant fees as well as cost of changes including but not limited to doors, vents, glass and other similar objects, lamps, electrical sockets and switches, and telephone sockets that are changed due to a position The tenant must bear the separation wall.

 

 

8.4

The dividing wall installed by the Tenant will become the property of the Tenant and must be dismantled at the time of returning the Rental Room to the Owner and the Tenant is obliged to repair damage arising from the demolition at his own expense. If the Tenant neglects to carry out the demolition, the Owner, with a fee to be billed to the Tenant, will demolish the separation wall in the Rental Room.

 

Article 9

Obligations of the Owner

 

During the Term of the Lease, the Owner promises and binds himself to comply with and carry out the following obligations:

 

9.1

In accordance with the payment that must be made by the Tenant as regulated in article 6.1 the Owner through the Building Manager is obliged to provide facilities as regulated in article 3.1 of this Agreement.

 

 
8

 

 

9.2

The owner through the building manager is obliged to maintain and make repairs to the damage to the facilities as referred to in articles 3.1.1 to 3.1.6, 3.1.8, and 3.1.10, and 3.1.15 which are not caused by the fault of the Tenant and / or Tenant employees and / or Tenant guests.

 

 

9.3

The owner, through the building manager, is required to insure the building against the risk of fire, earthquake, flood and other risks that are usually insured for office buildings in Jakarta, with full insurance value and pay insurance premiums on time.

 

 

9.4

The Owner is obliged to provide a guarantee to the Tenant that by having carried out the obligations of the Tenant under this Agreement, then during the Rental Period the Tenant will be able to use and enjoy the Rental Room quietly without interference from the Owner or other third parties.

 

Article 10

Taxes and Stamp Duty

 

10.1

Taxes arising from this Agreement will be the responsibility of each party, with the following conditions:

 

 

 

 

10.1.1.

The owner is obliged to pay taxes which according to tax laws and regulations in Indonesia must be paid by the owner through the building manager according to a predetermined rate including but not limited to land and building tax.

 

 

 

 

10.1.2.

Tenants are required to pay taxes which according to tax laws and regulations in Indonesia are required to be paid by the Tenant according to the rates set by the Government of the Republic of Indonesia on the Rental Price and all payment obligations that must be paid by the Owner and Tenant under this Agreement. The tenant is required to deduct Income Tax from the Rental Price paid every 3 (three) months according to the payment method.

 

Article 11

Transfer of Leases

 

11.1

During the Period of the Rental, the Tenant is prohibited from surrendering, transferring or leasing back the Rental Room or a part of the Rental Room to another third party without obtaining the prior written consent of the Owner.

 

 

 

11.2

The owner must give approval for the Tenant's intention to surrender, transfer or lease back the Rental Room or a part of the Rental Room if the Tenant has met the following conditions:

 

 

 

 

11.2.1

The Tenant must guarantee to the Owner that the third Party who will accept the delivery, transfer or leaseback of the Rental Room or part of the Rental Room (hereinafter referred to as "Substitute Tenant") is the responsible party and is in good financial condition. , and the Tenant has submitted the identity of the Substitute Tenant, which includes name, address, and line of business, to the Owner

 

 

 

 

11.2.2.

The Tenant has paid the Rental Price, Service Charge, fines, taxes and other payment obligations that must be paid by the Tenant under this Agreement which is due until the date of transfer of the lease to the Substitute Tenant.

 

 
9

 

 

 

11.2.3.

The Substitute Tenant must provide a written statement to the Owner, stating that the Replacement Charterer will pay the Rental Price, Service Fee and other payment obligations that must be paid for a Charterer under this Agreement and promises to pay attention to and implement the entire contents of this Agreement.

 

 

 

 

11.2.4.

The Tenant must provide a written statement to the Owner which states that the Charterer is willing to bear all payments that are the obligation of the Substitute Tenant, if during the remaining Lease Period, the Substitute Tenant does not carry out his payment obligations under this Agreement to the Owner.

 

Article 12

Extension of Rental Period

 

12.1

Within a period of not more than 90 (ninety days) prior to the expiration of the Lease Period, with a written notification, the Tenant may ask the Owner to extend the Rental Period, with the Rental Price, terms and conditions the same as This agreement.

 

 

12.2

Based on a letter of request from the Tenant, the Owner can submit a written amendment to the Rental Price, the terms and conditions of this Agreement, namely within a period of not more than 30 (thirty) days after receipt of the Charterer's request letter, as provided for in article 12.1 above.

 

 

12.3

Within a period of not more than 30 (thirty) days after receipt of the amendment letter from the Owner as stipulated in article 12.2 above, the Tenant must immediately provide assurance to extend the Term of the Lease by accepting the terms of the amendment to the Agreement to the Owner.

 

 

12.4

If the Tenant fails to comply with the provisions regarding the time limit as stated in articles 12.1 and 12.3 above, the Owner has the right to rent out the Rental Space for rent by a third party.

 

 

12.5

If there is no agreement between the Owner and Lessee regarding the Rental Price for an extension of the Rental Period; then the lease term will not be extended after the end of the Lease Period.

 

 

12.6

The Owner has the right not to re-lease the Rental Room to the Tenant or withdraw his agreement to extend the Rental Period with the Tenant if the remaining terms of the Rental Period are available, the Tenant violates the terms and conditions and / or obligations in this Agreement.

 

Article 13

Lease Termination

 

13.1.

Without prejudice to the provisions regarding the expiration of the Lease Period as stipulated in article 2.1 of this Agreement, the termination of the Lease Period may also occur due to one or more of the following:

 

 

 

 

13.1.1.

If the Tenant is in arrears in the payment of the Rental Price, Service Charge, and other fees that must be paid by the Tenant under this Agreement, within a period of 30 (thirty) days after the due date of the payment obligation and the Tenant still has not paid the arrears within a period of 14 (fourteen) days after sending a warning letter from the Owner.

 

 
10

 

  

 

13.1.2.

The Tenant has made 3 (three) late payments of the Rental Price, Service Charge, and other costs that must be paid by the Tenant according to this Agreement in a consecutive manner.

 

 

 

 

13.1.3.

The tenant is declared bankrupt or bankrupt or given a delay in the payment of his debts or is liquidated by the authorized party / agency or is unable to fulfill his financial obligations according to the laws and regulations of Indonesia.

 

 

 

 

13.1.4.

The tenant undergoes a legal process during the rental period.

 

 

 

 

13.1.5.

Lessee does not fulfill or neglects to carry out or has not started to carry out its obligations under this Agreement within 14 (fourteen) days after written notification from the Owner.

 

 

 

 

13.1.6.

All or any of the activities carried out by the Tenant in the Rental Room are declared invalid, confiscated, confiscated or ordered by the authorized agency to be closed or temporarily closed (suspended) and the Tenant cannot take steps to eliminate the condition within a period of 30 (three twenty) days after the issuance of a declaration of invalidity, confiscation, confiscation, order or other action by the Government.

 

13.2

With the occurrence of things as mentioned in paragraph 13.1 above, the Owner unilaterally has the right to immediately terminate / terminate this Agreement before the end of the Rental Period, without giving written notification to the Tenant, with the following conditions:

 

 

 

 

13.2.1.

The owner has the right to close, seal and / or take over the Rental Room from the Tenant, but without releasing the Tenant from his obligation to pay off and make payments and / or arrears to the Owner according to this Agreement, after being calculated with the Rental Guarantee that is on the owner.

 

 

 

 

13.2.2.

The owner has the right to hold the property of the Tenant in the Rental Room, as collateral for the payment obligations of the Tenant.

 

 

 

 

13.2.3.

The Owner has the right to ask the Tenant to immediately vacate the Rental Room after the Charterer has paid and carried out the payment obligations and / or arrears of payments to the Owner according to the Agreement, without neglecting the validity of the provisions in articles 14.3 to 14.6 of this Agreement.

 

 

 

 

13.2.4.

The owner has the right and full authority to sublet the Rental Space to a third party according to terms that are considered favorable by the Owner.

 

 

 

 

13.2.5.

The Tenant hereby grants the owner irrevocable power to sell the Tenants' items in the Rental Room to a third party as part and / or all of the Tenant's debt / arrears to the Owner, without prejudice to the Owner's right to collect the underpayment. to the Tenants.

 

 

 

 

13.2.6.

In the event of an agreement terminating unilaterally by the Owner, the Parties agree to override the enactment of articles 1266 and 1267 of the Indonesian Civil Code.

  

 
11

 

 

Article 14

Submission of Rental Space

 

14.1

At the expiration of the Lease Period as specified in article 2.1 or in the event of the termination of the lease as stipulated in article 13.1 of this Agreement, the Tenant is obliged to hand back the Rental Room to the Owner in an empty, clean state, no one uses and / or controls it as the situation was when it was handed over by the Owner to the Lessee.

 

 

14.2

If the Tenant neglects to return the Rental Room in accordance with the conditions set out in paragraph (1) above, then for each day of negligence or delay in the return of the Rental Room, the Tenant is required to pay a fine equal to the rental rate per square meter per month. which is divided pro rata according to the day of delay which will be calculated starting from the day the Tenant is obliged to submit the Rental Room until the day the Rental Room has been received back by the Owner. The fine must be paid immediately and at the same time at the first request of the Owner.

 

 

14.3

Without prejudice to the conditions described above, the Charterers hereby now and for the future at the time, give full power and authority to the Owner to take steps and / or actions deemed good and necessary to vacate themselves or with the help of parties. other for the Rental Room from the Tenant or anyone who uses or controls it and moves all items other than the property of the Owner in the Rental Room to the place determined by the Owner, at the costs and risks that must be borne by the Tenant.

 

 

14.4

The Tenant hereby releases the Owner from all responsibility for damage and / or loss of items transferred by the Owner from the Rental Room to a place determined by the Owner.

 

 

14.5

Tenants hereby waive all rights they have to file claims and / or lawsuits of any kind against the Owner regarding taking back the Rental Room, closing the Rental Room and / or vacating the Rental Room made or ordered to do by the Owner with method as described above and regarding all the consequences.

 

Article 15

Procedure for Acquisition and / or Vaccination of Rental Space

 

In the event that the Owner exercises his right to take over the Rental Room from the Tenant under article 13.2.1 of the Agreement and / or to vacate the Rental Room based on article 14.3 of the Agreement, the activity will be carried out in accordance with the provisions below:

 

15.1

The implementation of the takeover of the Rented Room from the Tenant and / or the vacating of the Rental Room must be recorded in an official report, attended by the security officer and the Owner as executing the activity.

 

 

15.2

Items found in the room will be recorded in a list signed by the officer present in carrying out the activity of taking over and / or vacating the Rental Room, as an inseparable attachment to the official report.

 

 

15.3

In order not to decrease in number, the items found in the Rental Room will be stored or deposited in a safe place which will be determined later by the Owner, until the Charterers collect them. The place where the goods are stored will be recorded in the minutes.

 

 

15.4.

Costs incurred in connection with carrying out activities of taking over and / or vacating the Rental Room, including but not limited to the cost of storing goods, will be borne by the Tenant.

 

 

15.5

If within a period of 30 (thirty) days the Charterer has not taken the goods from the storage or custody of the goods, then the Owner, pursuant to article 13.2.5 of the Agreement, has the right to sell the said goods.

 

 
12

 

 

Article 16

Force Majeure

 

16.1.

Force Majeure damage.

 

 

 

 

16.1.1.

If during the period of leasing the building and / or rental room experiences destruction, destruction or damage due to hurricanes, floods, fires, earthquakes, mass riots, war or other Force Majeure events so that it is uninhabitable and / or unfit for use again, this Agreement will terminate absolutely and will end from the date the event occurred.

 

 

 

 

16.1.2.

Such termination will not relieve the Tenant from his obligation to make full payment of arrears in Rental Price payments, Service Charges and other payment obligations under this Agreement.

 

Article 17

Arbitration

 

17.1

Disputes arising between the Parties in connection with this Agreement which in the opinion of each party cannot be resolved amicably, will be resolved in Jakarta at the Indonesian National Arbitration Board ("BANI"), according to and in accordance with the regulations imposed by BANI, with using a single arbitrator appointed in accordance with the applicable rules and stipulated by BANI.

 

 

17.2

Costs arising from dispute settlement through BANI will be borne by the Parties.

 

 

17.3

Regarding the implementation of the law of the BANI decision, the Parties agree to choose a permanent and general legal domicile at the Registrar's Office of the South Jakarta District Court.

 

 

17.4

Costs incurred in connection with the implementation of BANI's decision by the District Court, including but not limited to legal advisory fees, will be borne by the party implementing the BANI decision itself.

 

 

17.5

During the process at BANI, the Tenant is obliged to pay the Rental Price, Service Charge and other fees that must be paid by the Tenant under this Agreement.

 

 
13

 

 

Article 18

Applicable Law and Legal Domicile

 

18.1

This Agreement is governed by and is subject to and must be interpreted in accordance with the applicable laws in the Republic of Indonesia.

 

 

18.2

For the implementation of this Agreement, the Parties agree to choose a permanent and general legal domicile at the Registrar's Office of the South Jakarta District Court.

 

Article 19

Notification

 

19.1

Any notification or correspondence relating to this Agreement must be submitted in writing by registered mail, facsimile, or self-delivery to each of the following parties:

 

Owner

 

Tenant

PT. Charnic Capital Tbk.

 

PT. Toga International Indonesia

Menara Sudirman, Lantai 8

 

Plaza Asia, Lantai2

Jl. Jenderal Sudirman Kav. 60

 

Jl. Jenderal Sudirman Kav.59

Jakarta 12190

 

Jakarat 12190

 

 

 

Contact No. 021 5226528

 

Contact No. 021 51400069

Attn: Bp. Nicholas Saputra

 

Attn: Ibu Cecilia Tjahjadi

  

Article 20

Other provisions

 

20.1

Annex

 

 

 

 

Attachments I, II to this Agreement and the plan attachments are an integral and inseparable part of this Agreement.

 

 

 

20.2

Change of Agreement

 

 

 

 

Everything that is not or has not been sufficiently provided for in this Agreement will be regulated in an addendum or amendment made and signed by the Parties which are an integral part of this Agreement.

 

 

 

 

This agreement is made in 2 (two) copies, is sufficiently stamped and has the same legal force and was signed by the Parties on the day and date at the beginning of this Agreement.

 

Owner   Tenant  

PT. CHARNIC CAPITAL Tbk.

 

PT. TOGA INTERNATIONAL INDONESIA

 

 

 

 

 

   
Name: Anton Santoso   Name: Cecilia Tjahjadi  
Position: Director   Position: General Manager  

 

 
14

 

 

APPENDIX I -

ABOUT THE RENTAL ROOM

 

In this Agreement, Rental Space is defined as a room of 350 m2 (Three hundred and fifty square meters), as shown by the part with the red outline of the attached plan which is an integral and inseparable part of this Agreement, which includes the elevator part. , lobby, corridor, hallway, toilets, storage / meal preparation room and other common sections, which were on the 8th floor of Unit D of the building now known as Menara Sudirman which is located at Jalan Jend. Sudirman Kav. 60 Jakarta 12190

 

The Rental Price and Service Fee will be calculated based on the calculation of the gross area of the Room (semi gross area) for the purposes of this calculation, the semi gross area of the Rental Room will be measured from the finished inner surface of the permanent inner wall of the building, and from the finished inner surface of the permanent outer wall of the Building.

 

Including the gross area (semi gross area) of the rental space is the area used by the posts between the frame and window sills, free-standing structural posts, perimeter or pillars and the area used by additional facilities specifically built for each tenant.

 

The semi-gross area of the rental room includes the lobby, elevator, corridor, aisles, toilets, and food storage / preparation rooms.

 

Meanwhile, what is not included in the semi gross area of the Rental Room are all stairs, chimneys, lifts, engine rooms, M&E rooms, and service equipment supports.

 

If there are more than one tenant who jointly occupies 1 (one) floor, then the lift, lobby, corridor, hallway, toilet, storage and food preparation room and other Common Parts provided for the Tenants on that floor can be used together.

 

 
15

 

 

APPENDIX II -

RENT PRICE REVIEW AND SERVICE CHARGE

 

I. Rental Price Review

 

In April 2021 from the Rental Period (hereinafter referred to as "Rental Price Review Date"), the Rental Price will be reviewed in accordance with the market price of the Rental Price of the Rental Room in Menara Sudirman Building, 8th Floor unit D II. General Sudirman Kav. 60 Jakarta 12190 (hereinafter referred to as "Building") but the review of the rental price should not be less than the rental price agreed in the Room Rental Agreement.

 

The implementation of the Rental Price Review must meet the following conditions:

 

1.

At the latest within 60 (sixty) days before the Rental Price Review Date, the Owner must give notification to the Tenant regarding the amount of money which according to the owner's judgment is the market price of the Rental Price of the Rental Space in the Building.

 

 

2.

The tenant may submit his disagreement with the market price of the Rental Price of the Rental Room in the Building according to the owner's assessment and submit the market price of the Rental Price of the Rental Room in the Building according to the Tenant's assessment, within 14 (fourteen) days after receipt of notification from the Owner.

 

 

3.

If the Tenant does not provide notification as stipulated in item. 2, then the amount stated in the notification as stipulated in point 1 must be considered as the market price of the Rental Price of the Rental Space in the Building.

 

 

4.

If the Tenant gives notification as stipulated in point 2, then the Parties in good faith may carry out negotiations to obtain an agreement on the market price of the Rental Price of the Rental Space in the Building.

 

 

II.

Service Charge Review

 

 

1.

Initial Service Charge of Rp. 68,000 (Sixty-eight thousand Rupiah), per square meter per month which is calculated based on the estimated cost to be incurred by the Owner through the Building Manager for the provision of facilities for every 1 (one) year that has been running.

 

 

2.

If there is an increase in operational costs for the provision of facilities as referred to in article 3.1 of the Room Lease Agreement, or if there is a substantial additional cost that was not previously expected,

 

 

The owner, through the Building Manager, has the right to review the Service Charge that has been determined with prior written notification to the Tenant.

 

 

3.

At the end of each year, the Owner, through the Building Manager together with his auditors, will calculate the actual cost of providing facilities for the past 1 (one) year, (hereinafter referred to as "Real Cost ').

 

4.

Initial Service Charge for the next 1 (one) year will be determined by the Owner through the Building Manager based on the Real Cost which is determined from the audit result report, with due observance of the provisions as stipulated in Article 2 above.

 

 

5.

Service Charge per square meter will be defined as the total cost of providing facilities as stipulated in article 3.1 of the Room Lease Agreement for all Rental Space in the Building together with office operational costs including salaries, allowances and other costs for Building Management employees assigned to serve. the interests of the Tenants, the cost of replacing the equipment and equipment for the building, the cost of repairs to the leased space and / or the building as well as the depreciation cost of the electrical and mechanical equipment, divided by the number of square meters in the building

 

 
16

 

 

EXHIBIT 10.34

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXHIBIT 10.35

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 10.36

 

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 10.37

 

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 10.38

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXHIBIT 10.39

 

PERJANJIAN SEWA MENYEWA

RUANGAN PERKANTORAN

Nomor : 005/Plaza Asia/LA/XII/2017

 

OFFICE SPACE LEASE AGREEMENT

Number: 005/Plaza Asia/LA/XII/2017

 

 

 

 

 

Perjanjian Sewa Menyewa Ruangan Perkantoran (selanjutnya disebut “Perjanjian”) ini dibuat dan ditandatangani di Jakarta pada hari ini Senin, 18 Desemberi 2017 oleh dan antara:

 

This OFFICE  SPACE  LEASE AGREEMENT (hereinafter referred to as the “Agreement”) is made and entered into in Jakarta on Monday, 18 December 2017 by and between:

 

 

 

1.

PT. GUNUNG MARAS LESTARI, suatu perseroan terbatas yang didirikan berdasarkan hukum Negara Republik Indonesia, yang berkedudukan di Jakarta, di Plaza Asia, Lantai 2 Jalan Jenderal Sudirman Kav. 59 Jakarta Selatan 12190, dalam hal ini diwakili oleh Bp. Karli Boenjamin, dalam kedudukannya selaku Direktur PT. Gunung Maras Lestari (selanjutnya disebut “Pihak Pertama”); dan

 

1. 

PT. GUNUNG MARAS LESTARI a limited liability company duly established under the laws of the Republic of Indonesia, having its legal domicile in Jakarta, and office address at Plaza Asia,2nd Floor Jalan Jenderal Sudirman Kav. 59 Jakarta Selatan 12190; in this manner represented by Mr. Karli Boenjamin , in his capacity as Director PT. Gunung Maras Lestari (hereinafter referred to as the “First Party”); and

 

 

 

 

 

2. 

PT. TOGA INTERNATIONAL INDONESIA suatu perseroan terbatas yang didirikan berdasarkan hukum Negara Indonesia, yang berkedudukan di Menara Standard Chartered Bank Jalan Prof. Dr. Satrio No. 164 Jakarta Indonesia dalam hal ini diwakili oleh Ibu Cecilia Tjahjadi (selanjutnya disebut “Pihak Kedua”).

 

2.

PT. TOGA INTERNATIONAL INDONESIA a limited liability company duly established under the laws of the Republic of Indonesia, having its legal domicile at Jakarta and office address at Menara Standard Chartered Bank Jalan Prof. Dr. Satrio No. 164 Jakarta, Indonesia ; in this manner represented by Ms. Cecilia Tjahjadi (hereinafter referred to as the “Second Party”).

 

 

 

 

 

Pihak Pertama dan Pihak Kedua secara bersama-sama akan disebut “Para Pihak”.

 

The First Party and the Second Party are collectively referred to as the “Parties

 

 

 

 

 

A.  

 BAHWA, Pihak Pertama adalah Pemilik bangunan gedung perkantoran yang terletak Jalan Jenderal Sudirman Kav. 59 Jakarta Selatan 12190, (selanjutnya disebut “Plaza Asia”).

 

A.   

WHEREAS, the First Party is the owner of an office building located Jalan Jenderal Sudirman Kav. 59 South Jakarta 12190 (hereinafter referred to as “Plaza Asia”).

 

 

 

 

 

B. 

 BAHWA, Pihak Kedua, berdasarkan kebutuhannya untuk mempunyai tempat kedudukan atas usahanya, bermaksud untuk menyewa ruangan yang terletak di Plaza Asia.

 

B. 

WHEREAS, the Second Party requires an office space to operate its business, intends to lease such office space located at the Plaza Asia.

 

 

 

 

 

Berdasarkan hal-hal tersebut di atas, Para Pihak setuju dan sepakat untuk mengikatkan diri dalam Perjanjian ini, dengan syarat-syarat dan ketentuan-ketentuan sebagai berikut:

 

Pursuant to the above, the Parties agree and consent to enter into this Agreement, with the following terms and conditions.

 

 
1

 

 

Pasal 1

Definisi

 

ARTICLE 1

DEFINITIONS

 

 

 

 

 

 

 

1.1

Untuk maksud Perjanjian ini dan interprestasinya, istilah-istilah berikut ini mempunyai arti sebagai berikut, kecuali rangkaian kata-kata mensyaratkan pengertian lain:

 

1.1

For the purposes of this Agreement and its interpretations, the following terms shall have the meanings as set forth here in below, except as determined otherwise:

 

 

 

 

 

 

 

 

a.

"Badan Pengelola" berarti Pihak Pertama dan/atau pihak ketiga lainnya yang ditunjuk oleh Pihak Pertama yaitu Badan Pengelola Colliers International yang mempunyai tugas dan tanggung jawab untuk mengelola Plaza Asia dan bertanggung jawab sepenuhnya kepada Pihak Pertama.

 

 

a)

Board of Authority” means the First Party and/or other third parties duly appointed by the First Party is Building Management Colliers International whose duties and responsibilities are to manage the Plaza Asia and fully responsible to the First Party.

 

 

 

 

 

 

 

 

b.

"Jangka Waktu Sewa" berarti masa sewa dari sejak awal berlakunya sewa sampai berakhirnya sewa sebagaimana disebutkan dalam Perjanjian ini sebagaimana terlampir sebagai Lampiran 2 maupun perubahan- perubahannya yang merupakan satu kesatuan yang tidak terpisahkan dari Perjanjian ini.

 

 

b)

Lease Period” means the term of the lease from its commencement until the termination of the lease as mentioned in the Agreement and hereby attached in Attachment 2 or any of its amendments which will form an inseparable part to this Agreement.

 

 

 

 

 

 

 

 

c.

Grace Period” berarti masa tenggang waktu yang diberikan oleh Pihak Pertama kepada Pihak Kedua dalam rangka penataan Ruangan Sewa sebelum dimulainya Jangka Waktu Sewa yang akan disebutkan dalam BAST Awal. Grace period hanya berlaku untuk Ruangan Sewa, sedangkan untuk Ruangan Sewa Tambahan dan Fasilitas Sewa Tambahan tidak diberikan fasilitas Grace Period

 

 

c)

Grace Period” means the grace period provided by the First Party to the Second Party in preparing the Leased Premises prior to the commencement of the Lease Period described in the Initial Handover Report. The grace period shall only be valid for the Leased Premises and not for the Additional Leased Premises and its Additional Leased Facilities.

 

 

 

 

 

 

 

 

d.

Jam Kerja” berarti hari Senin sampai dengan Jumat, dari pukul 07.00 sampai dengan pukul 18.00 dan pukul 07.00 sampai dengan pukul 13.00 untuk hari Sabtu tidak termasuk hari libur nasional.

 

 

d)

Working Hours” shall mean Monday to Friday, from 07:00 am to 6:00 pm and for Saturdays, from 07:00 am to 1:00 pm not including national holidays.

 

 

 

 

 

 

 

 

e.

BAST Awal” yaitu dokumen berita acara serah terima yang ditandatangani oleh Pihak Pertama dan Pihak Kedua yang menjadi acuan dalam penyerahan Ruangan Sewa sebagai tanda telah diserahkannya Ruangan Sewa dari Pihak Pertama kepada Pihak Kedua.

 

 

e)

Initial Handover Report” shall mean the handing over document signed by the First Party and the Second Party which shall become the basis of evidence in handing over the Leased Premises as an acknowledgement of delivery of the Leased Premises from the First Party to the Second Party.

 

 
2

 

 

 

f.

BAST Akhir” yaitu dokumen berita acara serah terima yang ditandatangani oleh Pihak Pertama dan Pihak Kedua yang menjadi acuan dalam pengembalian Ruangan Sewa sebagai tanda telah dikembalikannya Ruangan Sewa dari Pihak Kedua kepada Pihak Pertama.

 

 

f)

Final Handover Report” shall mean the handover document signed by the First Party and the Second Party which shall become the basis of evidence in handing back the Leased Premises as an acknowledgement of return of the Leased Premises from the Second Party to the First Party.

 

 

 

 

 

 

 

 

g.

Bagian Bersama” berarti lobby, dapur, toilet, koridor, dan lift yang digunakan secara bersama-sama dengan Badan Pengelola, Pihak Kedua serta pihak-pihak lain yang berhak untuk memasuki Plaza Asia.

 

 

g)

Common Premises” shall mean lobby, kitchen, toilet, corridor and elevators used collectively between the Building Management, Second Party and other tenants having the rights to enter Plaza Asia.

 

 

 

 

 

 

 

 

h.

Ruangan Sewa” berarti luas kotor Ruangan diukur dari permukaan terluar bagian dalam Plaza Asia yang permanent, tidak termasuk tiang structural yang berdiri bebas, tiang keliling atau pilar-pilar.

 

 

h)

Leased Premises” shall mean the total area coverage of the premises measured from the outer surface of the permanent inner area of Plaza Asia , not including the structural pillars and the surrounding pillars.

 

 

 

 

 

 

 

 

i.

Ruangan Sewa Tambahan” berarti Ruangan yang disewa tanpa menggunakan Fasilitas Tambahan yang hanya digunakan sebagai gudang yang seluruh biaya yang timbul langsung menjadi beban Pihak Kedua.

 

 

i)

Additional Leased Premises:” shall mean the Leased Premises without Additional Facilities which shall only be used for storage, whereby the total direct costs shall be borne by the Second Party.

 

 

 

 

 

 

 

 

j.

Fasilitas Sewa Tambahan” berarti sewa atas peralatan pendukung yang menggunakan ruang luar Plaza Asia tanpa menggunakan Fasilitas Tambahan yang hanya digunakan sebagai pendukung peralatan telekomunikasi atau promosi yang seluruh biaya yang timbul langsung menjadi beban Pihak Kedua.

 

 

j)

Additional Leased Facilities” shall mean the lease for supporting equipment using the outside Plaza Asia space without using the Additional Facilities which is only used in supporting the telecommunications equipment or promotion which direct costs shall be borne by the Second Party.

 

 

 

 

 

 

 

 

k.

Semi Gross” adalah Ruangan Sewa yang disewakan ditambah luas Bagian Bersama yang akan dihitung secara proporsional.

 

 

k)

Semi Gross” shall mean the Leased Premises added with the Common Premises which shall be calculated proportionately.

 

 

 

 

 

 

 

 

l.

Biaya Tambahan” berarti seluruh biaya-biaya lain yang timbul yang harus ditanggung oleh Pihak Kedua selain dari Harga Sewa dan Service Charge.

 

 

l)

Additional Costs” shall mean all other costs which must be borne by the Second Party other than the Rental Price and Service Charge.

 

 
3

 

 

 

m.

"Fasilitas Sewa" berarti setiap dan seluruh fasilitas yang diberikan oleh Pihak Pertama yang telah menunjuk Badan Pengelola kepada Pihak Kedua sebagaimana dimaksud Pasal 8 Perjanjian ini, yang termasuk ke dalam Harga Sewa dan Service Charge.

 

 

m) 

Leased Facilities” shall mean each and every facility provided by the First Party duly appointed by Building Management to the Second Party as mentioned in Article 8 of this Agreement, which is included in the Rental Price and Service Charge.

 

 

 

 

 

 

 

 

n. 

"Harga Sewa" berarti harga penggunaan Ruangan Sewa yang dihitung Semi Gross sebagaimana diuraikan dalam Lampiran 3 yang merupakan satu kesatuan yang tidak terpisahkan dari Perjanjian ini.

 

 

n) 

Rental Price” shall mean the price in renting the Leased Premises calculated Semi-Gross as mentioned in attachment 3 which shall form an inseparable part to this Agreement.

 

 

 

 

 

 

 

 

o. 

"Service Charge" berarti biaya Fasilitas Sewa yang saling melengkapi dengan Harga Sewa sebagaimana dimaksud dalam Lampiran 5 yang merupakan satu kesatuan yang tidak terpisahkan dari Perjanjian ini.

 

 

o)

Service Charge” shall mean the cost of the Leased Facilities in addition to the Rental Price as mentioned in Attachment 5 which shall form an inseparable part to this Agreement.

 

 

 

 

 

 

 

 

p.

"Jaminan Sewa" berarti biaya jaminan dalam pembayaran Harga Sewa dan Service Charge sebesar 3 (tiga) bulan Harga Sewa sebagaimana dimaksud dalam Lampiran 3 dan Service Charge sebagaimana dimaksud dalam Lampiran 5 yang merupakan satu kesatuan yang tidak terpisahkan dari Perjanjian ini. Jaminan Sewa akan dikembalikan kepada Pihak Kedua dengan tanpa bunga maupun tambahan lain pada saat berakhirnya Jangka Waktu Sewa dengan ketentuan tidak ada lagi kewajiban Pihak Kedua yang belum dilaksanakan berdasarkan ketentuan Perjanjian ini.

 

 

p)

Rental Deposit” shall mean the deposit for the payment of the Rental Price and Service Charge amounting to three months of the Rental Price as mentioned in the Attachment 3 and the Service Charge as mentioned in Attachment 5 which shall form an inseparable part to this Agreement.

 

 

 

 

 

 

 

 

q. 

"Jaminan Telepon" berarti biaya jaminan dalam pembayaran biaya telepon yang besarnya ditentukan oleh Badan Pengelola sebagaimana disebutkan dalam Lampiran 4 yang merupakan satu kesatuan yang tidak terpisahkan dari Perjanjian ini. Jaminan Telepon akan dikembalikan oleh Badan Pengelola kepada Pihak Kedua dengan tanpa bunga maupun tambahan lain pada saat berakhirnya Jangka Waktu Sewa dengan ketentuan tidak ada lagi kewajiban Pihak Kedua yang belum dilaksanakan berdasarkan ketentuan Perjanjian ini.

 

 

q)   

 Telephone Deposit” shall mean a guaranteed deposit for the payment of telephone bills in which the amount is determined by the Building Management as mentioned in Attachment 4 which shall form an inseparable part to this Agreement. The Telephone Deposit shall be refunded from Building Management to the Second Party without interest or any other increments at the termination of the Lease Period with no further obligation from the Second Party that has not been executed based on the terms and conditions of this Agreement.

 

 
4

 

 

 

r. 

“Lahan Parkir” Plaza Asia menyediakan Fasilitas Parkir :

 

 

r) 

Parking Space” – Plaza Asia shall provide parking facility :

 

 

 

 

 

 

 

 

 

- Reserved and Unreserved parking dimana Pihak Kedua akan mendapatkan lokasi parkir Umum yang disediakan oleh Badan Pengelola.

 

 

 

 -Reserved and Unreserved Parking whereby Second Party will receive on common parking space provided by Building Management.

 

 

 

 

 

 

 

1.2

Judul pasal Perjanjian ini diberikan hanya untuk memudahkan pembacaan Perjanjian dan tidak boleh dipakai untuk interprestasi makna Perjanjian atau suatu pasal dalam Perjanjian ini.

 

 1.2

Article headings in this  Agreement  are  only  made for the purpose of easy reference and may not be used as interpretation of the meaning of this Agreement.

 

 

 

 

 

 

 

Pasal 2

Sewa Menyewa

 

ARTICLE 2

LEASE

 

 

 

 

 

 

 

2.1

Berdasarkan syarat-syarat dan ketentuan-ketentuan yang disebutkan dalam Perjanjian ini, Pihak Pertama dengan ini setuju untuk menyewakan kepada Pihak Kedua, Ruangan Sewa, Ruangan Sewa Tambahan (apabila ada) dan Fasilitas Sewa Tambahan (apabila ada) sebagaimana disebutkan dalam Lampiran 1 Perjanjian ini. Selama Jangka Waktu Sewa sebagaimana disebutkan dalam Lampiran 2 Perjanjian ini dengan membayar Harga Sewa sebagaimana disebutkan dalam Lampiran 3 Perjanjian ini dan membayar membayar Service Charge sebagaimana disebutkan dalam Lampiran 5 Perjanjian ini.

 

2.1 

Based on the terms and conditions mentioned in this Agreement, the First Party hereby agrees to rent to the Second Party, Leased Premises, Additional Leased Premises (if any), and Additional Leased Facilities (if any) as mentioned in Attachment 1 in this Agreement. For the term of the Lease Period as mentioned in Attachment 2 in this Agreement, the Second Party must pay the Rental Price as mentioned in Attachment 3 in this Agreement and pay the Service Charge as mentioned in Attachment 5 in this Agreement.

 

 

 

 

 

 

 

2.2

Dengan ditandatangani dan dilaksanakannya kewajiban Pihak Kedua sebagaimana diatur dalam Perjanjian ini, Pihak Kedua berhak untuk menggunakan Bagian Bersama secara bersama- sama dengan pihak lainnya.

 

2.2 

Upon signing and compliance of Second Party’s obligation, the Second Party has the right to use Common Premises collectively with other parties.

 

 

 

 

 

 

 

Pasal 3

Jangka Waktu Sewa dan Perpanjangannya

 

ARTICLE 3

LEASE TERM AND LEASE EXTENSION

 

 

 

 

 

 

 

3.1 

Jangka Waktu Sewa adalah sebagaimana disebutkan dalam Lampiran 2 Perjanjian ini.

 

3.1.

Lease Term shall refer to Attachment 2 in this Agreement.

 

 

 

 

 

 

3.2 

Dalam hal Pihak Kedua lalai dalam melaksanakan kewajibannya sebagaimana diatur dalam Perjanjian ini, maka Pihak Pertama berhak untuk mengakhiri Jangka Waktu Sewa yang telah disebutkan dalam Pasal 3.1.

 

3.2. 

In the event, Second Party fails to meet its obligations according to this Agreement, First Party reserves the right to terminate the Lease Period as mentioned in Article 3.1.

 

 
5

 

 

 3.3

Jangka Waktu Sewa yang disebutkan dalam Pasal 3.1 tidak termasuk Grace Period guna menata Ruangan Sewa sebagaimana diatur dalam Pasal 6 Perjanjian ini, Grace Period akan dihitung dari sejak dilakukannya BAST Awal Ruangan Sewa.

 

3.3. 

The Lease Period mentioned in Article 3.1 will not include Grace Period as stipulated in Article 6 of this Agreement. Grace Period shall be calculated from the commencement of the Leased Premises Initial Handover Report.

 

 

 

 

 

3.4.

Jangka Waktu Sewa dihitung dari sejak berakhirnya Grace Period.

 

3.4.    

Lease Period shall commence from the end of the Grace Period.

 

 

 

 

 

3.5    

Pihak Kedua berhak untuk memperpanjang Jangka Waktu Sewa dengan memberitahukan kepada Pihak Pertama selambat-lambatnya 3 (tiga) bulan sebelum berakhirnya Jangka Waktu Sewa.

 

3.5. 

The Second party has the right to extend the Lease Period by notifying the First Party at the latest within 3 (three) months prior to the expiration of the Lease Period.

 

 

 

 

 

3.6   

Dalam hal Pihak Kedua memohon perpanjangan Jangka Waktu Sewa sebagaimana disebutkan dalam Pasal 3.5, Pihak Pertama berhak menentukan syarat-syarat dan ketentuan-ketentuan lain untuk jangka waktu perpanjangan tersebut, baik mengenai Jangka Waktu Sewa, Harga Sewa, Service Charge, Biaya Tambahan maupun mengenai syarat-syarat lain sehubungan dengan perpanjangan Jangka Waktu Sewa tersebut.

 

3.6.  

In the event the Second Party applies for the extension of the Lease Period as stipulated in Article 3.5, the First Party reserves the right to determine other terms and conditions for the extension period such as : Rental Period, Rental Price, Service Charge, Additional Charges, including other conditions regarding Lease Period.

 

 

 

 

 

3.7  

Apabila Pihak Kedua tidak dapat menyetujui syarat- syarat baru sebagaimana disebutkan dalam Pasal 3.6, maka Pihak Pertama berhak menentukan bahwa Jangka Waktu Sewa tidak dapat diperpanjang dan dengan sendirinya berakhir pada tanggal yang disebutkan dalam Lampiran 2 Perjanjian ini.

 

3.7. 

In the event the Second Party does not agree to the new terms and conditions as mentioned in Article 3.6, the First Party reserves the right to automatically terminate the Lease Period on the date mentioned in Attachment 2 of this Agreement.

 

 

 

 

 

3.8

Apabila Pihak Kedua bermaksud untuk mengakhiri sewa menyewa sebelum berakhirnya Jangka Waktu Sewa, maka Pihak Kedua harus terlebih dahulu melunasi seluruh kewajiban pembayaran Harga Sewa dan Service Charge dan Biaya lain yang wajib dibayar oleh Pihak Kedua menurut Perjanjian ini sampai dengan berakhirnya Jangka Waktu Sewa dan/atau Pihak Kedua harus terlebih dahulu mencarikan penyewa pengganti yang diseujui Pihak Pertama untuk melanjutkan sewa Ruangan Sewa dalam Jangka Waktu Sewa.

 

3.8.  

In the event the Second Party intends to end the lease before the expiration of the Lease Period, the Second Party is obliged to settle the full Rental Price, Service Charge and all other fees and charges according to this Agreement, and/or Second Party has to find a replacement tenant that is approved by the First Party to continue to lease the Leased Premises within the Leased Period.

 

 
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Pasal 4

Syarat Penempatan Ruangan Sewa Dan Asuransi

 

ARTICLE 4

CONDITIONS FOR OCCUPYING THE LEASED PREMISES AND INSURANCE

 

 

 

 

 

 

 

4.1 

Pihak Kedua berhak menempati Ruangan Sewa jika telah memenuhi semua ketentuan dibawah ini:

 

4.1

The Second Party has the right to occupy Leased Premises upon complying to the following :

 

 

 

 

 

 

 

 

4.1.1

Perjanjian serta dokumen lain yang disyaratkan dalam Perjanjian telah ditandatangani sebagaimana mestinya;

 

 

4.1.1 

Signing of the Agreement and submission of all other pertinent documents.

 

 

 

 

 

 

 

 

4.1.2 

Pihak Kedua telah membayarkan Jaminan Sewa dan Jaminan Telepon

 

 

4.1.2

Payment of Rental Deposit and Telephone Deposit .

 

 

 

 

 

 

 

4.2 

hal-hal yang berkaitan dengan Ruangan Sewa, Ruangan Sewa Tambahan (apabila ada), dan Fasilitas Sewa Tambahan telah seluruhnya disepakati oleh Pihak Pertama dan pihak Kedua sebagaimana disebutkan dalam Lampiran 1 Perjanjian ini

 

4.2 

Matters that relate to the Leased Premises, Additional Leased Premises (if any), and the Additional Lease Facilities had all been agreed upon by the First Party and the Second Party as mentioned in Attachment 1 to this Agreement.

 

 

 

 

 

 

 

4.3

Dalam hal terjadi keterlambatan Pihak Kedua untuk menempati Ruangan Sewa, Ruangan Sewa Tambahan (apabila ada), dan Fasilitas Sewa Tambahan yang disebabkan oleh kegagalan dan/atau kelalaian Pihak Kedua sendiri dalam menyelesaikan penataan Ruangan Sewa dan atau dalam waktu yang ditetapkan sebagaimana dimaksud Pasal 3.3 Perjanjian ini, maka Pihak Kedua membebaskan Pihak Pertama dari tanggung jawab apapun dan keterlambatan itu tidak dapat mempengaruhi tanggal dimulainya Jangka Waktu Sewa, yang akan tetap dihitung mulai dari tanggal yang sudah ditetapkan dalam Lampiran 2 Perjanjian ini, sehingga Harga Sewa tetap harus dihitung sejak tanggal tersebut.

 

4.3 

In the event that there is a delay in the Second Party to occupy the Leased Premises, Additional Leased Premises (if any), and Additional Lease Facilities caused by the failure and or negligence of the Second Party in arranging the Leased Premises, and or within the time as determined in Article 3.3 of this Agreement, the Second Party releases the First Party from any responsibility whatsoever and such delay shall not influence the commencement date of the Lease Period, which shall be calculated starting from the date determined in Attachment 2 to this Agreement, so that the Rental Price shall be calculated since such date.

 

 

 

 

 

 

 

4.4 

Berkaitan dengan asuransi Plaza Asia yang dilakukan oleh Pihak Pertama sebagaimana diatur dalam Pasal 12 Perjanjian ini, Pihak Kedua dalam Ruangan Sewa wajib untuk tidak melakukan hal-hal yang sekiranya dapat membatalkan asuransi Plaza Asia, Pihak Pertama atau melakukan hal-hal yang dapat menambah rating resiko asuransi Plaza Asia Pihak Pertama. Sekiranya hal-hal tersebut dilakukan oleh Pihak Kedua, maka Pihak Kedua bertanggung jawab untuk membayar Biaya Tambahan guna membayar premi asuransi Plaza Asia Pihak Pertama sesuai dengan peningkatan premi yang terjadi karena meningkatnya resiko.

 

4.4  

In relation to the insurance of the Plaza Asia Building conducted by the First Party as mentioned in Article 12 of this Agreement, the Second Party in the Leased Premises is obliged not to perform any acts which may cancel the Plaza Asia insurance conducted by the First Party or perform acts which may increase the insurance risk rating of Plaza Asia. If such matters are in any way performed by the Second Party, then the Second Party shall be responsible to pay the Additional Costs for the insurance premium of Plaza Asia placed by the First Party in accordance to the increase in the premium caused by the increase in the risk.

 

 
7

 

 

Pasal 5

Harga Sewa dan Denda-denda

 

ARTICLE 5

RENTAL PRICE AND RENTAL FINES

 

 

 

 

 

5.1 

Harga Sewa Ruangan Sewa dan hal-hal yang berhubungan dengan Harga Sewa adalah sebagaimana disebutkan dalam Lampiran 3 Perjanjian ini.

 

5.1

The Rental Price of the Leased Premises and matters relating to the Rental Price are as mentioned in Attachment 3 to this Agreement.

 

 

 

 

 

5.2 

Harga Sewa dan Service Charge yang diperhitungkan adalah berdasarkan perhitungan Semi Gross.

 

5.2 

The Rental Price and Service Charge calculated are based on the calculation of the Semi Gross.

 

 

 

 

 

5.3  

Pihak Kedua wajib membayarkan Jaminan Sewa dan Jaminan telepon Bersamaan dengan penandatanganan Perjanjian ini dengan mendapatkan tanda penerimaan yang sah dari Pihak Pertama.

 

5.3 

The Second Party is obliged to pay the Rental Deposit and the Telephone Deposit upon the signing of this Agreement by receiving the valid receipt from the First Party.

 

 

 

 

 

5.4 

Pihak Pertama akan mengeluarkan tanda penerimaan yang sah terhadap setiap dan seluruh pembayaran yang dilakukan oleh Pihak Kedua, apabila pembayaran tersebut telah diterima dalam rekening Pihak Pertama.

 

5.4 

The First Party will issue a valid receipt for each and every payment made by the Second Party, if such payment had been received into the account of the First Party.

 

 

 

 

 

5.5 

Apabila Pihak Kedua lalai untuk melakukan pembayaran Harga Sewa, Service Charge dan Biaya Lain yang telah jatuh tempo selama lebih dari 30 (tiga) puluh hari dari tanggal yang telah ditentukan, maka Pihak Pertama akan mengenakan denda sebesar 2,5% (dua setengah) persen per bulan dari jumlah pembayaran yang telah jatuh tempo tersebut yang dihitung dari tanggal jatuh tempo sampai dengan tanggal pembayaran.

 

5.5 

If the Second Party is negligent in paying the Rental Price, Service Charge and Other Costs having the maturity date for more than 30 (thirty) days from the determined date, the First Party shall impose a penalty of 2, 5% (two and a half per cent) per month from the total payments having the maturity date calculated from the date of the maturity date until the payment date.

 

 

 

 

 

5.6  

Pembayaran yang dilakukan diluar ketentuan dalam Perjanjian tidak berlaku dan tidak mengikat bagi Pihak Pertama. Pihak Kedua harus dianggap belum melakukan pembayaran sebagaimana mestinya oleh Pihak Pertama.

 

5.6 

Payments made different from the provisions in this Agreement shall not be valid and not binding for the First Party. The Second Party shall be deemed by the First Party as having not made any payments as it should.

 

 

 

 

 

5.7.

Keterlambatan Pihak Kedua  menempati  Ruangan Sewa ataupun terhentinya pemakaian Ruangan Sewa atas kehendak Pihak Kedua atau karena sebab lain tidak membebaskan Pihak Kedua dari kewajibannya untuk membayar Harga Sewa, Service Charge dan Biaya Lain yang wajib dibayar oleh Pihak Kedua berdasarkan Perjanjian ini

 

5.7 

The delay of the Second Party in occupying the Leased Premises or the termination in using the Leased Premises as decided by the Second Party or due to other reasons shall not release the Second Party from its obligations to pay the Rental Price, Service Charge and Other Costs which are obliged to be paid by the Second Party pursuant to this Agreement.

 

 
8

 

  

Pasal 6

Penataan Ruangan Sewa

 

ARTICLE 6

DESIGN/ARRANGEMENT OF LEASED PREMISES

 

 

 

 

 

6.1      

Untuk keperluan penataan Ruangan Sewa, Pihak Kedua harus terlebih dahulu memberikan design dari tata ruang Ruangan Sewa dan kontraktor yang ditunjuk oleh Pihak Kedua selambat-lambatnya 3 (tiga) hari sebelum dimulainya jangka waktu penataan Ruangan Sewa sebagaimana dimaksud dalam Pasal 3.3 di atas, untuk memperoleh persetujuan terlebih dahulu dari Pihak Pertama dan Badan Pengelola, persetujuan Pihak Pertama wajib diberikan jika tidak ada dasar-dasar yang kuat untuk menolaknya, dan selanjutnya Pihak Kedua wajib berkoordinasi dengan Building Manager Badan Pengelola.

 

6.1

For purposes of arranging the Leased Premises, the Second Party must first give the design of the lay out of the Leased Premises and the contractor appointed by the Second Party at the latest within 3 (three) days prior to starting the period for arranging the Leased Premises as meant in Article 3.3 mentioned above, to obtain prior approvals from the First Party, the approval of the First Party and Building Management is obliged to be given if there are no solid grounds for refusal and further the Second Party is obliged to coordinate with the Building Manager Building Management.

 

 

 

 

 

6.2 

Penataan Ruangan Sewa dan perubahannya dilakukan oleh Pihak Kedua atas biaya Pihak Kedua, dan harus diselesaikan oleh Pihak Kedua dalam Grace Period yang ditentukan dalam pasal 3.3 Perjanjian ini.

 

6.2 

The arrangement of the Leased Premises and its changes are to be conducted by the Second Party on its own costs, and must be completed by the Second Party within the Grace Period determined in article 3.3 of this Agreement.

 

 

 

 

 

6.3  

Semua tindakan baik yang disengaja maupun tidak disengaja, kelalaian atau kealpaan wakil-wakil atau karyawan Pihak Kedua atau kontraktor yang ditunjuk Pihak Kedua sendiri dalam melaksanakan penataan Ruangan Sewa dianggap sebagai tindakan, kelalaian atau kealpaan Pihak Kedua dan sepenuhnya menjadi tanggung jawab Pihak Kedua.

 

6.3

All acts either intentional or unintentional, negligence or misconduct of the representatives or employees of the Second Party or the contractor appointed by the Second Party in arranging the Leased Premises shall be deemed to be an act, negligence or misconduct of the Second Party and shall be the full responsibility of the Second Party.

 

 

 

 

 

6.4 

Pihak Kedua wajib membayar ganti rugi kepada Pihak Pertama atas semua kerugian yang diderita oleh Pihak Pertama atas Ruangan Sewa sebagai akibat dari penataan Ruangan Sewa atau dari adanya tuntutan pihak ketiga berkenaan dengan pelaksanaan penataan Ruangan Sewa tersebut.

 

6.4 

The Second Party is obliged to pay compensation damages to the First Party for all loss and damages suffered by the First Party on the Leased Premises as a result of arranging the Leased Premises or due to claims from third parties in relation to the arrangement of such Leased Premises.

 

 

 

 

 

Pasal 7

Penggunaan Ruangan Sewa

 

ARTICLE 7

UTILIZATION OF LEASED PREMISES

 

 

 

 

 

7.1

Pihak Kedua  hanya  diperkenankan  untuk menggunakan Ruangan Sewa sesuai peruntukannya yaitu sebagai Ruangan Kantor, dan tidak boleh memakai Ruangan Sewa untuk ruang usaha lainnya kecuali disetujui secara khusus oleh Pihak Pertama.

 

7.1

The Second Party shall  only  be  permitted  to utilize the Leased Premises in accordance with its use namely for office space, and shall not use the Leased Premises for other business matters except if specifically approved by the First Party.

 

 
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7.2

Jika Pihak Kedua menggunakan Ruangan Sewa menyimpang dari tujuan yang disebut dalam Pasal 7.1 diatas tanpa mendapatkan persetujuan Pihak Pertama dan Pihak Pertama telah memberikan teguran tertulis mengenai hal tersebut sebanyak 3 (tiga) kali kepada Pihak Kedua, maka Pihak Pertama berhak dan dengan ini diberi kuasa oleh Pihak Kedua untuk menutup Ruangan Sewa, sampai Pihak Kedua menyatakan secara tertulis kepada Pihak Pertama bahwa Ruangan Sewa akan dipergunakan  untuk  maksud  tersebut  pada Pasal 7.1 di atas.

 

7.2

If the Second Party utilize the Leased Premises for purposes in deviation to those mentioned in Article 7.1 above without obtaining the approvals from the First Party and the First Party had given a warning in writing regarding such matter as much as 3 (three) times to the Second Party, the First Party is entitled and is hereby given powers by the Second Party to close the Leased Premises, until the Second Party declares in writing to the First Party that the Leased Premises shall be utilized for such purpose as mentioned in Article 7.1.

 

 

 

 

 

 

 

Pasal 8

Fasilitas

 

ARTICLE 8

FACILITIES

 

 

 

 

 

 

 

8.1

Selama Jam Kerja dalam Jangka Waktu Sewa, dengan telah dilaksanakannya pembayaran Harga Sewa dan Service Charge sebagaimana diatur dalam Perjanjian ini. Badan Pengelola menyediakan fasilitas yang akan diperinci lebih lanjut dalam Lampiran 4 Perjanjian ini, yang meliputi fasilitas- fasilitas sebagai berikut:

 

8.1

During the Working Hours in the Leased Term, by paying the Rental Price and Service Charge as stipulated in this Agreement, the Building Management provides facilities which shall be further detailed in Attachment 4 of this Agreement, which include the following facilities:

 

 

 

 

 

 

 

 

a. 

Aliran Listrik

 

 

a.

Electric Power

 

 

 

 

 

 

 

 

 

Ruangan Sewa akan dilengkapi aliran listrik dari PT Perusahaan Listrik Negara (Persero) (“PLN”), dengan daya yang besarnya telah ditetapkan oleh Badan Pengelola.

 

 

 

The Leased Premises shall be powered by electricity from PT Perusahaan Listrik Negara (“PLN”) with the capacity power as determined by the Building Management.

 

 

 

 

 

 

 

 

 

Pihak Pertama juga menyediakan generator yang sewaktu-waktu akan digunakan apabila terjadi pemadaman listrik dari PLN.

 

 

 

The First Party shall also provide a generator which shall be used in the event that there is a power shut down from PLN.

 

 

 

 

 

 

 

 

 

Hal-hal sehubungan dengan fasilitas aliran listrik yang diperoleh Pihak Kedua sebagaimana tersebut di atas akan dirinci lebih lanjut dalam Lampiran 4 dan Lampiran 5 Perjanjian ini.

 

 

 

Matters relating to the electricity facility obtained by the Second Party as mentioned above shall be further detailed in Attachment 4 and Attachment 5 to this Agreement.

 

 

 

 

 

 

 

 

b.  

Air Conditioning/Pendingin Ruangan

 

 

b.

Air Conditioning

 

 

 

 

 

 

 

 

 

Ruangan Sewa dilengkapi dengan Air Conditioning/Pendingin Ruangan dengan sistem VRV

 

 

 

The Leased Premises shall be equipped with a VRV air conditioning system.

 

 
10

 

 

 

c.

Telepon

 

 

c.

Telephone

 

 

 

 

 

 

 

 

 

Pihak Kedua dapat mengajukan permohonan tertulis kepada Badan Pengelola untuk mengurus sambungan telepon dan/atau sambungan langsung (direct line) kepada perusahaan penyedia sarana telekomunikasi (“Telecom Provider”) kedalam Ruangan Sewa, dimana besarnya biaya pemasangan akan ditentukan kemudian oleh Badan Pengelola. Biaya yang timbul atas sambungan telepon dan/atau sambungan langsung akan sepenuhnya menjadi tanggungan Pihak Kedua dan harus dibayar oleh Pihak Kedua sebelum dilakukan pemasangan sambungan telepon.

 

 

 

The Second Party may submit a written application to the Building Management to request a telephone installation and /or direct line to the Telecom Provider Company to the Leased Premises, in which the amount of the installation costs shall be later determined by the Building Mangement.. The costs which arise due to the telephone installation and or direct line shall be the full responsibility of the Second Party and must be paid by the Second Party prior to making the telephone installation.

 

 

 

 

 

 

 

 

 

Biaya-biaya dengan nama apapun juga yang dikenakan untuk pemakaian telepon dalam Ruangan Sewa menjadi tanggungan dan wajib dibayar oleh Pihak Kedua kepada Telecom Provider melalui Pihak Pertama dan/atau langsung kepada Telecom Provider.

 

 

 

Costs in whatever term imposed on the use of the telephone in the Leased Premises shall be the responsibility and is obliged to be paid by the Second Party to the Telecom Provider Company through the First Party and or direct to the Telecom Provider Company.

 

 

 

 

 

 

 

 

 

Pihak Kedua tidak berhak untuk mengalihkan pemakaian saluran telepon tersebut kepada pihak lainnya kecuali atas persetujuan tertulis Pihak Pertama.

 

 

 

The Second Party is not entitled to assign the use of the telephone line to other parties except upon the written approval of the First Party.

 

 

 

 

 

 

 

 

 

Hal-hal sehubungan dengan fasilitas telepon yang diperoleh Pihak Kedua sebagaimana akan dirinci lebih lanjut dalam Lampiran 4 dan Lampiran 5 Perjanjian ini.

 

 

 

Matters relating to telephone facilities obtained by the Second Party shall be further detailed in Attachment 4 and Attachment 5 to this Agreement.

 

 

 

 

 

 

 

 

d.

Kebersihan

 

 

d.

Cleanliness

 

 

 

 

 

 

 

 

 

Pihak Pertama bertanggung jawab untuk memelihara kebersihan Plaza Asia dan di tempat-tempat umum dalam kompleks Plaza Asia yang meliputi Bagian Bersama, bagian luar bangunan termasuk tiang, balok, jendela, tirai matahari, dinding luar, halaman depan, tepi jalan dan taman, halaman parkir mobil, jalan masuk, jembatan serta tempat pembuangan sampah.

 

 

 

The First Party is responsible to maintain the cleanliness of Plaza Asia and in public places within the Plaza Asia compound which include the Common Premises, outer parts of the building including pillars, piles, windows, sun shield curtains, outer walls, front terrace, and sideways, garden, car parking area, entrance road, bridge, and garbage waste disposal.

 

 

 

 

 

 

 

 

 

Pihak Kedua wajib menjaga kebersihan Ruangan Sewa.

 

 

 

The Second Party is obliged to keep the Leased Premises clean.

 

 
11

 

  

 

e.

Parkir

 

 

e.

Parking

 

 

 

 

 

 

 

 

 

Badan Pengelola menyediakan tempat parkir dan semua kendaraan baik milik karyawan, pimpinan dan tamu Pihak Kedua harus diparkir ditempat yang telah disediakan dengan dikenai tarif parkir sesuai dengan ketentuan yang berlaku.

 

 

 

The Building Management shall provide parking space and all vehicles either owned by the employees, management or guests of the Second Party must be parked at the space provided and shall be charged a parking tarif in accordance with prevailing rules.

 

 

 

 

 

 

 

 

 

Badan Pengelola menyediakan fasilitas parkir unreserved dengan selama Jangka Waktu Sewa sesuai dengan pertimbangan Pihak Pertama.

 

 

 

The Building Management shall provide unreserved parking facilities during the Lease Term as may be considered by the First Party.

 

 

 

 

 

 

 

 

 

Badan Pengelola tidak bertanggung jawab atas kerusakan maupun kehilangan kendaraan maupun bagian-bagiannya baik dibagian luar maupun bagian dalam kendaraan yang terjadi dalam lingkungan parkir yang disediakan Badan Pengelola.

 

 

 

The Building Management shall not be responsible for the damage and loss of the cars and or its parts whether the inner or the outer parts within the parking vicinity provided by the Building Management.

 

 

 

 

 

 

 

 

 

Hal-hal sehubungan dengan fasilitas parkir yang diperoleh Pihak Kedua sebagaimana akan diperinci lebih lanjut dalam Lampiran 4 Perjanjian ini.

 

 

 

Matters in relation to parking facilities obtained by the Second Party shall be further detailed in Attachment 4 of this Agreement.

 

 

 

 

 

 

 

 

f.

Keamanan

 

 

f.

Security

 

 

 

 

 

 

 

 

 

Building Management akan memberikan pelayanan tim keamanan yang akan bertugas selama 24 (dua puluh empat) jam setiap hari untuk menjaga keamanan di lokasi Plaza Asia dan sekitarnya, tetapi tidak termasuk dalam Ruangan Sewa.

 

 

 

The Building Management shall provide security by assigning a team which shall be on guard for 24 (twenty four) hours every day to protect the security at the Plaza Asia and its vicinity, but not including the Leased Premises.

 

 

 

 

 

 

 

 

g.

Lift

 

 

g.

Elevators

 

 

 

 

 

 

 

 

 

Pihak Pertama menyediakan 10 (sepuluh) buah lift penumpang dan lift barang yang berkecepatan tinggi untuk dipergunakan secara bersama-sama oleh para penyewa Plaza Asia

 

 

 

The First Party shall provide 10 (ten) high speed passenger elevators and service elevator to be used collectively by the tenants of Plaza Asia.

 

 

 

 

 

 

 

 

h.

Peralatan Sanitary

 

 

h.

Sanitary Equipment

 

 

 

 

 

 

 

 

 

Badan Pengelola sesuai dengan jadwal pemeliharaan yang wajar akan menyediakan kertas tissue dan sabun pencuci tangan di setiap toilet yang ada pada Plaza Asia.

 

 

 

The Building Mangement in accordance with a reasonable maintenance schedule shall provide tissue paper and hands washing soap in each toilet in the Plaza Asia.

 

 
12

 

  

 

i.

Bagian Informasi

 

 

i.

 Information section

 

 

 

 

 

 

 

 

 

Badan Pengelola akan menempatkan resepsionis atau petugas di lobi utama untuk memberikan pelayanan informasi dan pemanggilan mobil.

 

 

 

The Building Management shall place a receptionist or a personnel in the main lobby to provide information service and car calling.

 

 

 

 

 

 

 

 

j.

 Pembuangan Air Limbah

 

 

j.

 Water Waste Disposal

 

 

 

 

 

 

 

 

 

Badan Pengelola menyediakan sarana pemrosesan limbah dari toilet dan tempat pencucian piring, untuk selanjutnya akan disalurkan ke tempat penampungan yang disediakan oleh Badan Pengelola.

 

 

 

The Building Management shall provide waste process facilities from the toilet and dish washer bin to be further processed to disposal places provided by the Building Management.

 

 

 

 

 

 

 

 

k.

Pembuangan Sampah

 

 

k.

 Garbage Disposal

 

 

 

 

 

 

 

 

 

Badan Pengelola akan menyiapkan petugas khusus yang setiap harinya akan melakukan pembuangan sampah-sampah Penyewa ke luar Plaza Asia.

 

 

 

The Building Management shall provide special personnel on a daily basis and shall dispose garbage of the Tenants to places outside the Plaza Asia.

 

 

 

 

 

 

 

 

l.

Air

 

 

l.

Water

 

 

 

 

 

 

 

 

 

Air akan disediakan oleh Badan Pengelola pada tempat-tempat tertentu di dalam Plaza Asia yang dapat dipergunakan secara bersama-sama oleh Badan Pengelola, Pihak Kedua dan penyewa lainnya.

 

 

 

Water shall be provided by the Building Management at certain places within the Plaza Asia and which shall be utilized collectively by the Building Management, Second Party and other Tenants.

 

 

 

 

 

 

 

 

 

Penggunaan Ruangan Sewa selain untuk perkantoran atau yang sejenis akan diterapkan meter atas penggunaan air dengan tarif yang ditentukan oleh Badan Pengelola yang wajib dibayar oleh Pihak Kedua bersamaan dengan pembayaran Harga Sewa dan Service Charge.

 

 

 

The utilization of the Leased Premises other than for office use or the similar activities shall be installed a metering system for the use of water with a tariff determined by the Building Management and obligated to be paid by the Second Party upon the same time as payment is made for the Rental Price and Service Charge.

 

 

 

 

 

 

 

 

m.

Penanggulangan Kebakaran

 

 

m.

Handling of Fire

 

 

 

 

 

 

 

 

 

Badan Pengelola akan melengkapi Plaza Asia dengan sistem alarm dan alat pemadam kebakaran.

 

 

 

The Building Management shall equip Plaza Asia with an alarm system and fire extinguisher equipment.

 

 
13

 

   

Pasal 9

Service Charge dan Lain-lain

 

ARTICLE 9

SERVICE CHARGE AND OTHERS

 

 

 

 

 

 

 

9.1

Pihak Kedua setuju dan wajib membayar kepada Badan Pengelola Service Charge yang besarnya sebagaimana disebutkan dalam Lampiran 5 Perjanjian ini.

 

9.1

The Second Party agrees and is obliged to pay to the Building Management a Service Charge which amount is as mentioned in Attachment 5 to this Agreement.

 

 

 

 

 

 

 

9.2

Service Charge tersebut diatas tidak termasuk biaya pemakaian telepon, listrik dan pendingin ruangan.

 

 9.2

The Service Charge mentioned above shall not include the telephone use, electricity and Air Conditioning.

 

 

 

 

 

 

 

9.3

Keterlambatan Pihak Kedua menempati Ruangan Sewa ataupun terhentinya pemakaian Ruangan Sewa atas kehendak Pihak Kedua atau karena sebab lain tidak membebaskan Pihak Kedua dari kewajibannya untuk membayar Service Charge yang wajib dibayar oleh Pihak Kedua berdasarkan Perjanjian ini

 

9.3

The delay of the Second Party to utilize the Leased Premises or the termination of the utilization of Leased premises as decided by the Second Party or due to other reasons shall not release the Second Party from its obligations to pay the Service Charge which is obliged to be paid by the Second Party pursuant to this Agreement.

 

 

 

 

 

 

 

9.4

Biaya Service Charge akan ditinjau kembali yang akan dilakukan atas kebijakan Badan Pengelola dengan pertimbangan karena meningkatnya biaya untuk barang-barang, yang akan ditetapkan oleh Pihak Pertama berdasarkan penetapan atas biaya beban. Biaya untuk menyediakan service akan ditentukan oleh Badan Pengelola setiap tahun kecuali karena keadaan yang tak terduga dan khusus tetapi tidak terbatas pada keadaan yang tak terduga dan khusus tetapi tidak terbatas pada keadaan umum dari yang sebelumnya meliputi :

 

 9.4.

The Service Charge shall be subject to review, which shall be made at the sole discretion of the Building Management with due consideration to increases of cost for the aforesaid items. The Service Charge will be assessed by the First Party.The cost of providing services shall be determined by the Building Management on an annual basis except due to unforeseen circumstances and in particular but without limiting the generality of the foregoing, shall include :

 

 

 

 

 

 

 

 

9.4.1

Biaya operational dan pemeliharaan termasuk perbaikan pada fasilitas umum meliputi parkir dan semua area lainya dalam gedung yang tidak dengan sengaja termasuk sewa, meliputi listrik, penyejuk ruangan (AC), pipa-pipa ledeng, saluran pembuangan air, pencegahan kebakaran, sistim komunikasi telepon, biaya pegawai, kontrak manajemen dan servis yang berhubungan dengan persyaratan ini, biaya keamanan, pembuangan sampah, pertamanan, pemeliharaan luar dan dalam Gedung serta kebersihan Gedung.

 

 

9.4.1.

The cost of operating and maintaining including repairs to the Common Facilities including parking and all other areas of the building not expressly under lease, including the electrical, air conditioning, plumbing, drainage, fire prevention, telephone communication system and the cost of employees, management and service contracts related thereto, the cost of security, rubbish removal, landscaping, external and internal maintenance and cleaning of the building.

 

 
14

 

  

 

9.4.1.2. 

Biaya operational dan pemeliharaan termasuk pemeliharaan perbaikan system penyediaan air bersih, perbaikan system penyaluran air kotor dan pembuangan air, penanganan saluran kotoran dan system- sistem yang terkait lainya, pemeliharaan perbaikan lift yang digunakan di Gedung, pemeliharaan termasuk perbaikan system perlindungan kebakaran, termasuk sprinkler, detector asap dan panas, hidran dan alat pemadam kebakaran jenis portable bersama dengan semua pompa-pompa, alarm-alarm dan peralatan lainya, pemeliharaan struktur Gedung termasuk system kedap air pada penutup atap dan tembok serta jendela luar, pengecetan bagian luar, pemasangan pipa luar, biaya penyediaan jasa kebersihan, fasilitas umum, biaya penyediaan kertas toilet dan sabun. Biaya penyediaan asuransi Gedung termasuk Polis kebakaran dan bahaya, tanggung jawab kecelakaan umum serta kerugian biaya sewa atau asuransi. Biaya atas semua bea dan Pajak Bumi dan Bangunan dan semua surat ijin dari pemerintah.

 

 

9.4.1.2.

The cost of operating and maintaining including repairing the water supply, repairing the sewerage and drainage system, Treatment Plant and related systems, repairing the lifts used in the building, repairing the fire protection systems including sprinklers, smoke heat detectors, hydrants and fire extinguishers together with all associated pumps, alarms and other apparatus, repairs the main fabric of the building including the water proofing of the roof coverings, external paint work and cladding and the external piping. The cost of all utilities supplied, cleaning services to all common facilities, supplying toilet paper, soap. The cost of providing such insurances including fire and perils policy, public liability and loss of rents insurances, The cost of all rates and personal property taxes and any all governmental permits.

 

 

 

 

 

 

 

Pasal 10

Pajak-pajak

 

ARTICLE 10

TAXES

 

 

 

 

 

 

 

Pajak-pajak yang ditimbulkan dari Perjanjian ini akan menjadi tanggung jawab dari masing-masing pihak, dengan ketentuan sebagai berikut:

 

The taxes which arise from this Agreement shall be the responsibility of each respective party, with the following provisions:

 

 

 

 

 

 

 

10.1

Pihak Pertama wajib membayar pajak-pajak yang menurut hukum dan peraturan perpajakan di Indonesia wajib dibayar oleh Pihak Pertama sesuai dengan tarif yang sudah ditetapkan termasuk akan tetapi tidak terbatas pada Pajak Bumi Bangunan atas Plaza Asia.

 

10.1

The First Party is obligated to pay the taxes which in accordance with the tax laws and regulations in Indonesia is obliged to be paid by the First Party in line with the tarif determined including but not limited to the Land and Building Tax of Plaza Asia..

 

 

 

 

 

 

 

10.2

Semua pajak (termasuk Pajak Pertambahan Nilai) dan pungutan lain yang sewaktu-waktu dikenakan berhubung dengan pemakaian atau sewa-menyewa Ruangan Sewa serta semua pajak, iuran, sumbangan atau pungutan lain yang berkenaan dengan usaha Pihak Kedua, seluruhnya harus ditanggung dan dibayar oleh Pihak Kedua tepat pada waktunya.

 

10.2

All taxes ( including Value Added Tax) and other levies which shall from time to time be imposed in relation to the utilization or lease of the Leased Premises and all taxes, stipends, donations or other levies in relation to the business of the Second Party, all must be borne and paid by the Second Party in a punctual manner.

 

 
15

 

 

Pasal 11

Kewajiban-kewajiban dan Tanggung Jawab Pihak Kedua

 

ARTICLE 11

OBLIGATIONS AND RESPONSIBILITIES OF THE SECOND PARTY

 

 

 

 

 

 

 

Selama Jangka Waktu Sewa, Pihak Kedua berkewajiban untuk:

 

During the Lease Period, the Second Party is obligated to:

 

 

 

 

 

 

 

A.

Pembayaran Harga Sewa dan Biaya-Biaya Lain

 

A.

Payment of Rental Price and Other Costs

 

 

 

 

 

 

 

 

a.

Pihak Kedua wajib membayar Harga Sewa, Service Charge, dan Biaya Lain termasuk biaya pemakaian listrik dan pendingin ruangan, dan biaya telepon yang menjadi kewajibannya berdasarkan Perjanjian ini tepat pada waktunya.

 

 

a.

The Second Party is obligated to pay the Rental Price, Service Charge, and Other Costs including the costs of electricity and air conditioning and the telephone costs which are its obligations pursuant to this Agreement and which must be paid in time.

 

 

 

 

 

 

 

 

b.

Jika Pihak Kedua terlambat membayar jumlah tersebut, Pihak Kedua wajib membayar denda sebagaimana ditetapkan dalam Pasal 5 Perjanjian ini.

 

 

b.

If the Second Party is late in making these payments, the Second Party is obliged to pay the penalties as determined in Article 5 of this Agreement.

 

 

 

 

 

 

 

 

c.

Jika keterlambatan pembayaran jumlah tersebut dalam butir a diatas, melampaui 30 (tiga puluh) hari sejak saat pembayaran itu seharusnya dilakukan, Pihak Pertama berhak memutuskan aliran listrik dalam Ruangan Sewa dan Pihak Pertama hanya setuju untuk menghubungkan kembali aliran listrik setelah seluruh jumlah yang terhutang telah dilunasi sebagaimana mestinya oleh Pihak Kedua.

 

 

c.

If the delay in such payment as mentioned in item a above exceeds 30 (thirty) days since such payment should had actually been made, the First Party is entitled to cut off the electric power to the Leased Premises and the First Party shall only agree to connect the electric power after all the outstanding debts had been paid accordingly by the Second Party.

 

 

 

 

 

 

 

 

 

Dalam hal demikian Pihak Kedua wajib membayar biaya pemasangan kembali aliran listrik sesuai peraturan yang berlaku.

 

 

 

In such matter the Second Party is obligated to pay the installation costs for the electric power in accordance with the prevailing rules.

 

 

 

 

 

 

 

 

d.

Jika keterlambatan pembayaran tersebut diatas berlangsung selama 90 (sembilan puluh) hari berturut-turut atau terjadi keterlambatan pembayaran untuk ketiga kalinya dalam setahun kalender, Pihak Pertama berhak secara sepihak mengakhiri Perjanjian, dengan cara memberitahukan pengakhiran ini secara tertulis kepada Pihak Kedua sesuai Pasal 15 Perjanjian.

 

 

d.

If such delay in the payment endures for 90 (ninety) consecutive days or in the case of a delay in payment for the third time in one calendar year, the First Party is entitled unilaterally to terminate this Agreement by notifying this termination in writing to the Second Party in accordance with Article 15 of this Agreement.

 

 
16

 

 

B

Penggunaan Ruangan Sewa

 

B.

Utilization of Leased Premises

 

 

 

 

 

 

 

 

a.

Pihak Kedua wajib mempergunakan Ruangan Sewa sesuai dengan peruntukannya sebagaimana tersebut dalam Pasal 7.1

 

 

a.

The Second Party is obligated to utilize the Leased Premises in accordance with its use as mentioned in Article 7.1.

 

 

 

 

 

 

 

 

b.

Pihak Kedua berjanji bahwa Ruangan Sewa baik sebagian maupun seluruhnya, tidak akan dipergunakannya untuk melakukan perbuatan yang bertentangan dengan hukum, termasuk tetapi tidak terbatas pada tempat judi, tempat perbuatan maksiat maupun perbuatan lain yang melanggar norma-norma kesusilaan.

 

 

b.

The Second Party promises that the Leased Premises either in part or its entirety shall not be utilized for acts that are in violation to the laws, including but not limited to gambling, indecent acts or other acts violating the moral and ethics

 

 

 

 

 

 

 

 

c.

Pihak Kedua wajib memperhatikan dan menaati peraturan perundang-undangan yang berlaku yang berhubungan dengan sewa menyewa, dan pelanggaran terhadap peraturan-peraturan yang dimaksud adalah sepenuhnya menjadi tanggung jawab Pihak Kedua sendiri.

 

 

c.

The Second Party is obliged to observe and follow the prevailing laws in relation to lease and violations towards such regulations shall become the responsibility of the Second Party.

 

 

 

 

 

 

 

 

d.

Pihak Kedua berjanji untuk mencegah agar dalam Ruangan Sewa tidak terjadi perbuatan yang dapat menimbulkan kerusakan atau keributan atau gangguan pada Pihak Pertama atau pada pihak lainnya.

 

 

d.

The Second Party promises to avoid any acts which may cause damage, or commotion, or disturbances to the First Party or to other parties.

 

 

 

 

 

 

 

 

e.

Pemasangan, penambahan dan perubahan instalasi listrik harus seizin Pihak Pertama dan dilakukan baik oleh Pihak Pertama atau kontraktor Pihak Kedua, seluruhnya atas beban biaya Pihak Kedua.

 

 

e.

The installation, additions and changes to the electric installation must obtain a prior approval from the First Party and shall be conducted either by the First Party or the contractor of the Second Party all at the costs of the Second Party.

 

 

 

 

 

 

 

 

f.

Segala pekerjaan reparasi pada Ruangan Sewa, termasuk tetapi tidak terbatas pada instalasi listrik hanya boleh dilakukan oleh Pihak Pertama atau wakilnya atau pihak yang ditunjuk Pihak Pertama.

 

 

f.

All repair work in the Leased Premises, including but not limited to the electric installation may only be conducted by the First Party or its representative or the party appointed by the First Party.

 

 

 

 

 

 

 

 

g.

Pihak Kedua wajib memelihara semua bagian Ruangan Sewa termasuk semua pintu, barang-barang yang melekat pada Ruangan Sewa kepunyaan Pihak Pertama dan Bagian Bersama dalam keadaan baik dan bersih, serta menggantikan bagian yang rusak atau mengadakan perbaikan, semuanya itu atas biaya Pihak Kedua, jika hilangnya atau rusaknya tersebut karena kelalaian Pihak Kedua, pegawai, wakil, tamu atau kontraktor Pihak Kedua.

 

 

g.

The Second Party is obliged to maintain all parts of the Leased Premises including all the doors, fixtures in the Leased premises owned by the First Party, and Common Premises in good condition and cleanliness, and to replace the damaged parts or to make restorations, all of which shall be at the cost of the Second Party, if such loss or damage is due to the negligence of the Second Party, its employees, representatives, guests or contractor of the Second Party.

 

 
17

 

 

 

h.

Pihak Kedua dengan ini membebaskan Pihak Pertama dari tuntutan ganti-rugi atas kehilangan, kerusakan atau kerugian atas barang milik Pihak Kedua yang karena kebakaran, gempa bumi, angin topan, huru- hara, pencurian atau sebab-sebab lainnya. Oleh karena itu Pihak Kedua setuju dan berjanji untuk mengasuransikan sendiri barang-barang miliknya yang berada didalam Ruangan Sewa.

 

 

h.

The Second Party hereby shall release the First Party from claim damages due to the loss, damage or other loss for goods owned by the Second Party due to fire, earthquake, hurricane, riots, theft or other causes.

Therefore, the Second Party agrees and promises to self insure its goods in the Leased Premises.

 

 

 

 

 

 

 

 

i.

Pihak Kedua wajib melengkapi setiap dan seluruh izin-izin atas usahanya dan dengan ini Pihak Kedua membebaskan Pihak Pertama dari segala tuntutan dari pihak ketiga yang diakibatkan karena kelalaian Pihak Kedua dalam melengkapi izin-izin tersebut.

 

 

i.

The Second Party is obliged to possess each and every business license and the Second Party release the First Party from all claims from third parties caused by the negligence of the Second Party in completing such licenses.

 

 

 

 

 

 

 

 

j.

Pihak Kedua wajib mendapatkan izin dari Pihak Pertama sebelum melakukan pemasangan papan nama, tulisan, sarana pengiklanan atau tanda khusus lainnya pada Ruangan Sewa.

 

 

j.

The Second Party is obliged to obtain permission from the First Party prior to installing the board name, signs, means of advertisement or other special signs in the Leased Premises.

 

 

 

 

 

 

 

C.

Kebersihan

 

C.

Cleanliness

 

 

 

 

 

 

 

 

a.

Pihak Kedua dilarang menyapu/ mengeluarkan / membuang sampah / kotoran Ruangan Sewa ke tempat umum selain di tempat yang telah ditentukan di sekitar Ruangan Sewa dan/atau pada lantai sekitar Ruangan Sewa.

 

 

a.

The Second Party is prohibited to sweep or throw out any garbage or dirt from the Leased Premises to other public places other than the places already determined surrounding the Leased Premises and or the floor surrounding the Leased Premises.

 

 

 

 

 

 

 

 

b.

Pihak Kedua wajib untuk memperbaiki dan membersihkan kerusakan/kotor yang disebabkan pengangkutan barang milik Pihak Kedua dari dan ke Ruangan Sewa. 

 

 

b.

The Second Party is obliged to repair and clean any damage or dirt caused by the transportation of goods owned by the Second Party from and to the Leased Premises.

 

 

 

 

 

 

 

D.

Teknik

 

D.

Technical Support

 

 

 

 

 

 

Pihak Kedua dilarang merusak dan/atau mengubah Panel Distributor Listrik dan telepon serta instalasi lainnya.

 

The Second Party is prohibited to destroy and or change the Electric Panel Distributor and telephone and other installations.

 

 
18

 

 

E.

Pihak Kedua Bertanggung Jawab atas Kerugian Pihak Pertama

 

E.

The Second Party is responsible for Damages to the First Party

 

 

 

 

 

 

Pihak Kedua bertanggung jawab penuh atas kerugian yang diderita oleh Pihak Pertama yang disebabkan karena kesalahan/kelalaian Pihak Kedua, para karyawan, dan tamu Pihak Kedua dalam melaksanakan ketentuan Perjanjian ini.

 

 

The Second Party shall be fully responsible for the damages suffered by the First Party due to the fault or negligence of the Second Party, its employees, and guests of the Second Party in executing the provisions of this Agreement.

 

 

 

 

 

F.

Pihak Kedua Bertanggung Jawab atas Karyawan dan Tamu

 

F.

 The Second Party is responsible for the Employees and Guests

 

 

 

 

 

 

Pihak Kedua bertanggung jawab penuh atas unsur pimpinan, karyawan maupun tamu Pihak Kedua untuk mematuhi Peraturan-peraturan sewa sebagaimana disebutkan dalam Lampiran 7 Perjanjian ini dan peraturan lainnya yang ditetapkan oleh Pihak Pertama sebagaimana diatur dalam Perjanjian ini maupun peraturan lainnya.

 

 

The Second Party shall be fully responsible for the management, employees and guests of the Second Party to follow the lease regulations as mentioned in Attachment 7 to this Agreement and other rules determined by the First Party as mentioned in this Agreement or other regulations.

 

 

 

 

 

Pasal 12

Kewajiban-kewajiban dan Tanggung Jawab Pihak Pertama

 

ARTICLE 12

OBLIGATIONS AND RESPONSIBILITIES OF THE FIRST PARTY

 

 

 

 

 

Sehubungan dengan Perjanjian ini, Pihak Pertama berkewajiban selama Jangka Waktu Sewa:

 

In relation to this Agreement, the First Party is obliged during the Lease Period

 

 

 

 

 

12.1

Mengusahakan sebaik mungkin untuk membuat Badan Pengelola melaksanakan kewajiban- kewajibannya untuk menjaga dan memelihara semua Fasilitas yang disediakan senantiasa dalam keadaan bersih, terpelihara baik dan berjalan dengan baik.

 

12.1

To try its best efforts so that the Management Authority shall endeavor its obligations to protect and maintain all Facilities, provided so that they are in good condition, well maintained and in good running condition.

 

 

 

 

 

12.2

Mengusahakan sebaik mungkin untuk melaksanakan kewajiban-kewajibannya untuk menjaga dan memelihara kebersihan semua Fasilitas, serta Bagian Bersama yang dipergunakan bersama dengan para Pihak Pertama dan Pihak Kedua lain, seperti jalan dan ruang pintu masuk agar tetap dalam keadaan baik dan bersih.

 

12.2

To try its best efforts in performing its obligations to protect and maintain the cleanliness of all the Facilities, and the Common Premises used collectively with the First Party and the Second Party such as the road and entrance hall way so that they are in good and clean condition.

 

 

 

 

 

12.3

Pihak Pertama wajib mengasuransikan Plaza Asia dan Ruangan Sewa (tidak termasuk barang-barang Pihak Kedua yang berada di dalam Ruangan Sewa) terhadap bahaya kebakaran.

 

12.3  

The First Party is obliged to insure the Plaza Asia and the Leased Premise (not including the goods owned by the Second Party located in the Leased Premises) towards the danger of fire.

 

 
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12.4

Pihak Pertama tidak diwajibkan mengganti kerugian dalam bentuk apapun maupun mengembalikan Harga Sewa, apabila terjadi kerusakan antara lain karena kebakaran, huru-hara, dan lain-lain yang disebabkan kelalaian/kesalahan Pihak Kedua, para karyawan atau tamu dari Pihak Kedua yang mengakibatkan Pihak Kedua tidak dapat menikmati Ruangan Sewa.

 

12.4

The First Party is not obligated to pay any compensation damages in whatever form, or to refund the Rental Price, in the event that there are damages caused among others by fire, chaos, and other causes caused by the negligence or fault of the Second Party, its employees or guests of the Second Party causing the Second Party unable to utilize the Leased Premises.

 

 

 

 

 

 

Sedangkan apabila terjadi kerusakan karena antara lain kebakaran, gempa bumi, angin topan, huru- hara, yang tidak disebabkan oleh kesalahan/kelalaian Pihak Kedua, maka Pihak Pertama akan memperbaiki Ruangan Sewa sepanjang hal tersebut dapat diperbaiki dan/ atau dilindungi oleh suatu asuransi.

 

 

However, if there is damage due to among others fire, earthquake, hurricane, which are not caused by the fault or negligence of the Second Party, the First Party shall repair the Leased Premises as long as such damage could be repaired and or protected by insurance.

 

 

 

 

 

12.5

Pihak Pertama tidak bertanggung jawab terhadap musnah/hilangnya barang-barang milik Pihak Kedua karena sebab apapun juga, antara lain kebakaran, gempa bumi, angin topan, huru-hara, pencurian dan lain-lain.

 

12.5

The First Party shall not be responsible towards the destruction or loss of goods owned by the Second Party due to whatever reason, among others fire, earthquake, hurricane, riots, theft and others.

 

 

 

 

 

12.6

Pihak Pertama tidak bertanggung jawab atas kecelakaan yang diakibatkan atas kelalaian pemakaian atau karena sebab-sebab diluar kemampuan Pihak Pertama.

 

12.6

The First Party shall not be responsible for accidents caused by the negligence in the use or due to causes beyond the capacity of the First Party.

 

 

 

 

 

12.7

Pihak Pertama menjamin, selama Pihak Kedua memenuhi kewajiban atau ketentuan dalam Perjanjian, Pihak Kedua dapat mempergunakan Ruangan Sewa dengan tenteram dalam arti bahwa Pihak Kedua tidak akan mendapat tuntutan atau gangguan dari pihak ketiga yang menyatakan mempunyai hak untuk menempati Ruangan Sewa.

 

12.7

The First Party guarantees that as long as the Second Party fulfills its obligations or provisions in this Agreement, the Second Party may utilize the Leased Premises with quite enjoyment in the sense that the Second Party shall not face any suit or disturbance from any third party claiming to have the right to utilize the Leased Premises.

 

 

 

 

 

Pasal 13

Pemindahan Hak Sewa

 

ARTICLE 13

DISPOSITION OF LEASE RIGHTS

 

 

 

 

 

13.1

Pihak Kedua dapat memindahkan hak sewanya atau hak lainnya yang ada berdasarkan Perjanjian, dengan memperoleh persetujuan tertulis lebih dahulu dari Pihak Pertama.

 

13.1

The Second Party may dispose or transfer the lease rights or other prevailing rights pursuant to this Agreement, by obtaining the prior written approvals from the First Party.

 

 
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13.2

Tanpa persetujuan tersebut segala pemindahan hak sewa atau penyerahan hak lainnya berdasarkan Perjanjian ini kepada pihak lain adalah tidak sah dan tidak dapat mengikat Pihak Pertama.

 

13. 2

Without such approvals, all dispositions of the lease rights or transfer of other rights pursuant to this Agreement to other parties shall not be valid and binding to the First Party.

 

 

 

 

 

 

Dalam hal terjadinya pemindahan hak sewa secara diam-diam oleh Pihak Kedua, maka Pihak Pertama berhak untuk segera mengakhiri Perjanjian, dan Pihak Kedua wajib mengosongkan Ruangan Sewa dan mengembalikannya kepada Pihak Pertama atas permintaan pertama Pihak Pertama.

 

 

In the event that a disposition of the lease rights is conducted secretly by the Second Party, the First Party shall be entitled to immediately terminate the Agreement, and the Second Party is obliged to vacate the Leased Premises and hand it over to the First Party at the first request of the First Party.

 

 

 

 

 

 

Jika Pihak Kedua tidak mengosongkan Ruangan Sewa, maka Pihak Kedua dengan ini, yang berlaku pada waktunya, memberi kuasa kepada Pihak Pertama untuk mengosongkan Ruangan Sewa dengan cara mengeluarkan semua barang serta barang-barang dan peralatan milik Pihak Kedua. Pihak Pertama tidak bertanggung jawab atas kondisi dan keamanan barang-barang milik Pihak Kedua tersebut.

 

 

If the Second Party does not vacate the Leased Premises, the Second Party hereby shall give a power of attorney which shall be valid at it own time, to the First Party to vacate the Leased Premises by way of taking out all of the goods and equipment of the Second Party. The First Party shall not be responsible on the conditions and security of such goods owned by the Second Party.

 

 

 

 

 

 

Pihak Pertama tidak berkewajiban untuk memberikan pertanggung jawaban atas pelaksanaan kuasa tersebut.

 

 

The First Party is not obliged to be responsible for the undertaking of such power of attorney.

 

 

 

 

 

13.3

Apabila pemindahan hak sewa kepada pihak lain disetujui oleh Pihak Pertama, maka Pihak yang menerima pemindahan hak sewa tersebut wajib menandatangani surat perjanjian yang maksud dan isinya ditentukan oleh Pihak Pertama yang antara lain mewajibkan pihak yang menerima pemindahan hak sewa tersebut untuk mentaati dan terikat pada semua syarat dan ketentuan dalam Perjanjian ini.

 

13. 3

If the disposition of the lease right to the other party is approved by the First Party. The Party receiving such disposition or transfer of lease right is obliged to sign an agreement which contents and provisions shall be decided by the First Party which among others shall oblige the party receiving such disposition of lease right to follow and bind by the terms and conditions in this Agreement.

 

 

 

 

 

13.4

Pemindahan hak sewa ini tidak dapat dilakukan sebelum Harga Sewa, Service Charge dan Biaya Lainnya yang telah jatuh tempo dilunasi oleh Pihak Kedua.

 

13. 4

The disposition of the lease rights may not be conducted prior to settlement of the Rental Price, Service Charge and Other Costs which had matured by the Second Party.

 

 

 

 

 

13.5

Pemindahan hak sewa hanya berlaku untuk seluruh sisa Jangka Waktu Sewa, baik untuk sebagian atau seluruh bagian dari Ruangan Sewa.

 

13.5

The disposition of the lease rights shall only be valid for the entire remaining Lease Period either in part or its entirety for the Leased Premises.

 

 

 

 

 

13.6

Pemindahan hak sewa wajib dibuat dan dilaksanakan dalam suatu dokumen tertulis yang dipersiapkan oleh Pihak Pertama dan akan ditandatangani oleh Pihak Pertama, Pihak Kedua dan pihak yang menerima pemindahan hak sewa dari Pihak Kedua..

 

13.6

The disposition of the lease rights is obliged to be conducted and executed in a written document prepared by the First Party and shall be signed by the First Party, Second Party and parties receiving the transfer of lease rights from the Second Party.

 

 
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Pasal 14

Pengakhiran Perjanjian dan Akibatnya

 

ARTICLE 14

TERMINATION OF LEASE AGREEMENT AND ITS CONSEQUENCES

 

 

 

 

 

 

 

 

 

14.1

Pengakhiran Perjanjian Sebelum Jangka Waktu Sewa Berakhir

 

14.1  

Termination of the Agreement Prior to the Expiration of the Lease Period:

 

 

 

 

 

 

 

 

 

 

14.1.1  

 

Jika terjadi salah satu peristiwa tersebut di bawah ini, Pihak Pertama berhak dengan segera mengakhiri Perjanjian ini dengan cara memberikan pemberitahuan tertulis kepada Pihak Kedua tentang pengakhiran Perjanjian.

 

 

14.1.1

 

In the event that any one incident mentioned below occurs, the First party shall be entitled to immediately terminate this Agreement by way of giving prior notice to the Second Party regarding the termination of the Agreement.

 

 

 

 

 

 

 

 

 

 

14.1.2  

Peristiwa-peristiwa yang dimaksud dalam Pasal 14.1.1 Perjanjian ini adalah:

 

 

14.1.2

The incidents meant in Article 14.1.1 of this Agreement are:

 

 

 

 

 

 

 

 

 

 

 

14.1.2.1 

jika Pihak Kedua tidak mentaati dan/atau memenuhi salah satu ketentuan- ketentuan yang termaksud dalam Perjanjian

 

 

 

14.1.2.1

If the Second Party does not follow and or fulfill any provisions stipulated in the Agreement

 

 

 

 

 

 

 

 

 

 

 

14.1.2.2

jika Pihak Kedua meng gunakan Ruangan Sewa untuk suatu kegiatan yang terlarang menurut hukum Indonesia, atau

 

 

 

14.1.2.2

If the Second Party utilize the Leased Premises for a prohibited act under the Indonesian laws, or

 

 

 

 

 

 

 

 

 

 

 

14.1.2.3

barang-barang Pihak Kedua disita oleh instansi yang berwenang, atau

 

 

 

14.1.2.3

The goods of the Second Party is seized and confiscated by the Authorities, or

 

 

 

 

 

 

 

 

 

 

 

14.1.2.4

Pihak Kedua dinyatakan pailit berdasarkan ketetapan Pengadilan yang berkekuatan pasti, atau

 

 

 

14.1.2.4

The Second Party is declared bankrupt based on the Court Decree having a binding powers, or

 

 

 

 

 

 

 

 

 

 

 

14.1.2.5

Pihak Kedua tidak membuka atau tidak menggunakan Ruangan Sewa selama 90 (sembilan puluh) hari berturut-turut, tanpa izin tertulis terlebih dahulu dari Pihak Pertama.

 

 

 

14.1.2.5

The Second Party does not open or utilize the Lease Premises for 90 (ninety) consecutive days without the prior written approval from the First Party.

 

 
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14.1.3  

Setelah Pihak Pertama memberitahukan tentang pengakhiran Perjanjian kepada Pihak Kedua sesuai ayat 14.1.1 Pasal ini, Pihak Pertama berhak untuk segera menawarkan dan menyewakan kembali Ruangan Sewa tersebut kepada pihak lain yang ditunjuk Pihak Pertama tanpa perlu adanya persetujuan apapun dari Pihak Kedua.

 

 

14.1.3      

After the First Party notifies the termination of the Agreement to the Second Party in accordance with section 14.11 of this Article, the First Party is entitled  to immediately offer and lease the Leased Premises to the other party appointed by the First Party without the requirement for any approval whatsoever from the Second Party.

 

 

 

 

 

 

 

 

 

 

14.1.4  

Jika Perjanjian diakhiri sesuai Pasal 14.1.1 Perjanjian ini, maka Pihak Pertama berhak untuk:

 

 

14.1.4      

If the Agreement is terminated in accordance with Article 14.1.1 of this Agreement, the First Party is entitled to:

 

 

 

 

 

 

 

 

 

 

 

14.1.4.1  

Memutuskan aliran listrik dalam Ruangan Sewa tersebut;

 

 

 

14.1.4.1

Shut down the electric power in the Leased Premises

 

 

 

 

 

 

 

 

 

 

 

14.1.4.2  

Menutup, menyegel dan/atau mengambil alih Ruangan Sewa dengan tanpa membebaskan Pihak Kedua dari kewajiban-kewajiban pembayaran yang masih tertunggak;

 

 

 

14.1.4.2  

Close, seize and or take over the Leased Premises without releasing the Second Party of its obligations to pay its outstanding debts.

 

 

 

 

 

 

 

 

 

 

 

14.1.4.3  

Menahan barang - barang Pihak Kedua sebagai jaminan atas kewajiban pembayaran dari Pihak Kedua;

 

 

 

14.1.4.3  

To seize and hold the goods owned by the Second Party as collateral for its payment obligations;

 

 

 

 

 

 

 

 

 

 

 

14.1.4.4  

Meminta Pihak Kedua untuk mengosongkan Ruangan Sewa setelah Pihak Kedua melaksanakan kewajiban pembayaran;

 

 

 

14.1.4.4  

To request the Second Party to vacate the Leased Premises after the Second Party has conducted its payment obligations;

 

 

 

 

 

 

 

 

 

 

 

14.1.4.5  

Menyewakan Ruangan Sewa kepada pihak ketiga lainnya.

 

 

 

14.1.4.5  

To lease the Leased Premises to other third parties.

 

 

 

 

 

 

 

 

 

 

14.1.5  

Kelalaian Pihak Kedua untuk melaksanakan atau memenuhi sesuatu ketentuan dalam Perjanjian ini cukup dibuktikan dengan lewatnya waktu saja, sehingga tidak diperlukan adanya suatu teguran, surat juru sita atau surat-surat lain yang mempunyai kekuatan serupa bagi Pihak Pertama untuk melaksanakan hak- haknya berdasarkan Perjanjian, khususnya hak Pihak Pertama tersebut dalam Pasal 14.1.1.

 

 

14.1.5        

The negligence of the Second Party to conduct or fulfill the provisions in the Agreement shall be sufficient by proving the lapse of time, so that a warning is not necessary and other confiscation letter or other documents from the confiscation officer or Court  bailiff may not be required to perform such rights pursuant to this Agreement, specifically the right of the First Party as mentioned in Article 14.1.1

 

 
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14.1.6 

Untuk dapat memberlakukan ketentuan- ketentuan serta hak-hak Pihak Pertama berdasarkan Pasal 14 ini, Pihak Pertama dan Pihak Kedua setuju dan dengan ini melepaskan Pasal 1266 dan 1267 Kitab Undang-undang Hukum Perdata.

 

 

14.1.6  

To enforce the provisions and rights of the First Party pursuant to Article 14, the First Party and the Second Party agrees and hereby waives Articles 1266 and 1267 of the Code of Civil Law.

 

 

 

 

 

 

 

 

14.1.7  

Pemberitahuan mengenai berakhirnya Perjanjian berdasarkan ketentuan dalam Perjanjian ini harus dilakukan oleh Pihak Pertama kepada Pihak Kedua dengan surat pos tercatat dan berlaku sejak tanggal tanda terima yang dibubuhkan oleh Petugas Kantor Pos untuk pengiriman surat pemberitahuan tersebut ke alamat tersebut dalam Lampiran 6 Perjanjian ini.

 

 

14.1.7   

The notification regarding the termination of this Agreement based on the provisions of this Agreement must be made by the First Party to the Second Party by registered mail and valid since the date of receipt stamped by the Post Office officer for sending the notification letter to the address mentioned in Attachment 6 of this Agreement.

 

 

 

 

 

 

 

 

14.1.8  

Jika Pihak Kedua ingin mengakhiri Perjanjian sebelum berakhirnya Jangka Waktu Sewa, Pihak Kedua harus memberitahukan niatnya itu sedikitnya 3 (tiga) bulan sebelum tanggal pengakhiran yang dikehendaki Pihak Kedua dengan meminta persetujuan tertulis Pihak Pertama. 

 

 

14.1.8   

If the Second Party intends to terminate the Agreement prior to the termination of the Lease Period, the Second Party must notify its intentions at least 3 (three) months prior to the expiration date intended by the Second Party by seeking written approvals from the First Party.

 

 

 

 

 

 

 

 

14.1.9  

Dalam hal pengakhiran Perjanjian ini dan/atau Jangka Waktu Sewa dimohonkan oleh Pihak Kedua, maka pengakhiran Perjanjian dan/atau Jangka Waktu Sewa lebih awal itu baru berlaku sesuai jika (a) disetujui Pihak Pertama dan (b) Pihak Kedua telah memenuhi semua syarat yang ditentukan dalam mengakhiri lebih awal Perjanjian dan/atau Jangka Waktu Sewa yang ditentukan oleh Pihak Pertama termasuk namun tidak terbatas melunasi semua jumlah uang yang terhutang olehnya berdasarkan Perjanjian.

 

 

14.1.9   

In the event of termination of this Agreement and / or Lease Period is filed by the Second Party, then the termination of the Agreement and / or Lease Period shall applies only if ( a ) approved the First Party and (b) the Second Party has complied with all requirements specified in early termination to the Agreement and / or Lease Period as determined by the First Party, including but not limited to pay all outstanding money under the Agreement.

 

 
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14.2    

Pengakhiran Perjanjian Karena Jangka Waktu Sewa Berakhir

 

14.2

The Termination of the Agreement Due to the Expiration of the Lease Period

 

 

 

 

 

 

 

 

14.2.1  

Apabila Perjanjian ini berakhir karena berakhirnya Jangka Waktu Sewa sebagaimana ditetapkan dalam Lampiran 2 Perjanjian ini, maka Pihak Kedua wajib mengembalikan Ruangan Sewa kepada Pihak Pertama dalam keadaan kosong.

 

 

14.2.1        

 

If the Agreement expires due to the expiration of the Lease Period as mentioned in Attachment 2 to this Agreement, the Second Party is obliged to hand-over the Leased Premises to the First Party in an empty condition.

 

 

 

 

 

 

 

 

14.2.2  

Pihak Kedua berhak atas pengembalian Jaminan Sewa, dan Jaminan Telepon dari Pihak Pertama sebagaimana dimaksud dalam Perjanjian ini.

 

 

 14.2.2      

The Second Party shall be entitled for the refund of the Rental Deposit, and Telephone Deposit from the First Party as mentioned in this Agreement.

 

 

 

 

 

 

 

Pasal 15

Penyerahan Kembali Ruangan Sewa

 

ARTICLE 15

HANDING OVER LEASED PREMISES BACK TO THE FIRST PARTY

 

 

 

 

 

 

 

15.1      

Berakhirnya Jangka Waktu Sewa sebagaimana ditetapkan dalam Lampiran 2 Perjanjian ini atau karena diakhiri oleh Pihak Pertama sesuai dengan Pasal 14.1.1 atau diakhiri oleh Pihak Kedua berdasarkan Pasal 14.1.10 diatas, mewajibkan Pihak Kedua untuk menyerahkan kembali kepada Pihak Pertama, Ruangan Sewa dalam keadaan baik dan bersih serta kosong sebagaimana pada saat BAST Awal, selambat-lambatnya pada tanggal Perjanjian ini dan/atau Jangka Waktu Sewa berakhir atau diakhiri.

 

15.1

The expiration  of  the  Lease  Period  as  mentioned in Attachment 2 of this Agreement or due to the termination by the First Party in accordance with Article 14.1.1 or terminated by the Second Party pursuant to Article 14.1.10 above, shall oblige the Second Party to hand-over to the First Party, the Leased Premises in good and clean condition and empty as upon the Initial Hand-Over Report, at the latest upon the date of this Agreement and/or Lease Period had expired or is terminated.

 

 

 

 

 

 

 

15.2 

Dalam hal Pihak Kedua lalai untuk menyerahkan kembali Ruangan Sewa tersebut kepada Pihak Pertama, maka untuk setiap hari kelalaian atau keterlambatan dalam hal penyerahan kembali Ruangan Sewa, dalam keadaan tersebut dalam Pasal 14.2.1 di atas ini, Pihak Kedua wajib membayar uang denda kepada Pihak Pertama yang ditetapkan sebesar jumlah Harga Sewa Ruangan Sewa untuk 1 (satu) bulan, terhitung sejak tanggal Pihak Kedua seharusnya menyerahkan Ruangan Sewa tersebut sampai dengan tanggal Ruangan Sewa tersebut diterima kembali dalam keadaan kosong dan baik oleh Pihak Pertama atau keadaan lain yang disetujui Pihak Pertama.

 

15.2

In the event the Second Party is negligent to hand-over the Leased Premises to the First Party, for each day in negligence or delay in relation to the hand-over of the Leased Premises, in such condition in Article 14.2.1 above mentioned, the Second Party is obliged to pay penalties to the First Party which is determined in the amount of the Rental Price of the Leased Premises for 1 (one) month , calculated since the date the Second Party should have hand-over the Leased Premises until the date the Leased Premises had been received back in an empty and good condition by the First Party or other conditions as agreed to by the First Party.

 

 
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15.3 

Tanpa mengurangi ketentuan-ketentuan yang diuraikan diatas, Pihak Kedua dengan ini sekarang dan untuk kemudian pada waktunya memberi kuasa dan wewenang penuh kepada Pihak Pertama untuk melakukan semua tindakan dan langkah-langkah yang dianggap baik oleh Pihak Pertama guna mengambil dan mengosongkan sendiri atau suruh untuk mengkosongkan Ruangan Sewa yang bersangkutan dari siapapun juga yang memakai/menguasai serta memindahkan semua dan setiap barang-barang milik/kepunyaan siapapun juga yang berada/disimpan dalam Ruangan Sewa itu, dan berhak untuk kemudian menjual barang- barang itu dengan harga dan syarat-syarat yang ditetapkan Pihak Pertama, serta mempergunakan hasilnya guna membayar ongkos-ongkos penguasaan kembali Ruangan Sewa serta membayar ongkos penjualan barang-barang Pihak Kedua dan akhirnya melunaskan semua tunggakan Pihak Kedua kepada Pihak Pertama berdasarkan Perjanjian. Pihak Pertama jika dipandang perlu, juga berhak untuk mempergunakan bantuan alat-alat kekuasaan Negara, semuanya atas ongkos/biaya Pihak Kedua.

 

15.3    

Without prejudice to the previous provisions mentioned   hereinabove,   the   Second  Party hereby for now and in the future at its own good time give a power of attorney and full authority to the First Party to conduct all actions and steps which are deemed right by the First Party to repossess and vacate or instruct another party to vacate the Leased Premises from any other parties whatsoever using or occupying and to move all and each goods owned which are kept in the Leased Premises, and is entitled to sell such goods in accordance with the price and conditions as determined by the First Party, and to use the proceeds to pay the costs of such repossession of the Leased Premises and to pay costs for the sale of the goods owned by the Second Party and finally to settle all outstanding debts of the Second Party to the First Party based on this Agreement. The First Party if deemed necessary is also entitled to use the assistance of Government authorities all at the expense of the Second Party.

 

 

 

 

 

15.4

Dalam kejadian tersebut Pihak Kedua membebaskan Pihak Pertama untuk memberikan tanggung jawab sebagai seorang pemegang kuasa dan Pihak Pertama juga tidak dapat diwajibkan untuk membayar suatu ganti rugi berupa apapun, baik kepada Pihak Kedua maupun kepada pihak lain yang mendalihkan berhak atas seluruh atau sebagian barang dalam Ruangan Sewa.

 

15. 4

In such condition the Second Party releases the First Party in its capacity to be responsible as a proxy and the First Party shall not be obliged to pay any damages whatsoever, in whatever form, either to the Second Party or to any other party which shall claim its rights either in its entirety or partly to the goods in the Leased Premises.

 

 

 

 

 

 

Pihak Kedua dengan ini secara tegas membebaskan (vrijwaring) Pihak Pertama terhadap pihak ketiga dan berjanji untuk membayar suatu ganti rugi berupa apapun, baik kepada Pihak Kedua maupun kepada pihak lain yang mendalihkan berhak atas seluruh atau sebagian barang dalam Ruangan Sewa.

 

 

The Second Party hereby explicitly releases the First Party from any third party claims and promises to pay compensation damages in whatever form either to the Second Party or to such other party which claim as the rightful owner to the goods in the Leased Premises.

 

 

 

 

 

15.5

Sepanjang masih diperlukan, Pihak Kedua dengan ini pula sekarang untuk di kemudian hari, melepaskan semua dan setiap haknya (sepanjang hak-hak tersebut masih dimilikinya) untuk mengajukan tuntutan/gugatan berupa apapun juga terhadap Pihak Pertama baik mengenai pengambilan dan pengosongan atas Ruangan Sewa maupun pemindahan, dan penjualan barang- barang termaksud diatas, yang dilakukan atau suruh dilakukan oleh Pihak Pertama dengan cara yang diuraikan diatas, maupun mengenai segala akibat yang timbul sehubungan dengan pemindahan dan penjualan barang-barang tersebut serta pengambilan dan pengosongan Ruangan Sewa.

 

15.5

As long as it is still required, the Second Party hereby now and for the future, release all of its rights (as long as such rights are still possessed ) to file a claim or law suit in whatever form towards the First Party either regarding the taking over and vacating of the Leased Premises , or the moving and sale of such goods mentioned above, which are conducted or instructed to be conducted by the First Party by the ways mentioned above, or regarding all of its consequences as a result of such movement and sale of such goods and the taking over and vacating of the Leased Premises.

 

 
26

 

 

Pasal 16

Force Majeure

 

ARTICLE 16

FORCE MAJEURE

 

 

 

 

 

Para Pihak secara tegas menyetujui bahwa apabila terjadi kejadian atau peristiwa yang secara layak dan patut tidak dapat dihindarkan/dielakkan atau berada di luar kemampuan Pihak Pertama untuk menghindarkan kejadian atau peristiwa tersebut ("Force Majeure"), termasuk tetapi tidak terbatas pada kecelakaan, huru-hara, epidemi, kebakaran, banjir, eksplosi, pemogokan umum, perang, perubahan peraturan perundang-undangan, tindakan Pemerintah, jatuhnya kapal terbang, kekacauan sosial, dan bencana alam, maka Pihak Pertama akan bertanggung jawab untuk memperbaiki kerusakan Ruangan Sewa sampai dengan jumlah nilai pertanggungan yang ditutup oleh Pihak Pertama pada perusahaan asuransi yang ditunjuk;

 

The Parties explicitly agree that in the event of an event or incident which reasonably could not have been avoided or are beyond the capacities of the First Party to avoid such event or incident (“Force Majeure”) including but not limited to accidents, riots, epidemics, fire, flood, explosions, general strike, war, changes in the laws and legislation, Government acts, airplane accident, civic commotion, and natural disasters the First Party shall be responsible to cure the damage to the Leased Premises until the limit amount of sum insured and covered by the First Party's appointed insurer.

 

 

 

 

 

 

Pasal 17

Hukum Yang Berlaku

 

ARTICLE 17

GOVERNING LAWS

 

 

 

 

 

Perjanjian ini, penafsiran dan pelaksanaan serta segala akibat yang ditimbulkannya, diatur dan tunduk kepada hukum Negara Republik Indonesia.

 

This Agreement its interpretations, and implementation and all of its consequences shall be governed by and subject to the laws of the Republic of Indonesia.

 

 

 

 

 

Pasal 18

Penyelesaian Perselisihan dan Domisili Hukum

 

ARTICLE 18

SETTLEMENT OF DISPUTE AND LEGAL DOMICILE

 

 

 

 

 

18.1

Jika terjadi perselisihan, perbedaan pendapat maupun sengketa yang timbul sehubungan/sebagai akibat dari pengikatan ini, maka Para Pihak akan menyelesaikannya secara musyawarah dalam jangka waktu 30 hari.

 

18.1

In the event of a dispute, difference of opinion and or legal dispute which may arise as a result of this Agreement, then the Parties shall settle through a consensus reached by consultations within 30 days.

 

 

 

 

 

18.2

Jika penyelesaian secara musyawarah tidak membawa hasil, maka Para Pihak sepakat untuk menyelesaikan sengketa yang terjadi melalui Badan Arbitrase nasional Indonesia (BANI) di Jakarta, dimana Pihak Pertama dan Pihak Kedua masing- masing akan menunjuk anggota BANI dan kedua anggota BANI tersebut akan menunjuk anggota BANI ketiga.

 

18.2

If such consultations do not bring any results the Parties agree to settle the dispute through the Indonesian National Arbitration Body (BANI) in Jakarta, in which the First Party and the Second Party shall each appoint a member of BANI and both members shall appoint a third BANI member.

 

 

 

 

 

18.3

Para Pihak sepakat bahwa keputusan yang dikeluarkan oleh BANI merupakan keputusan yang final serta mengikat Para Pihak dan oleh karenanya Para Pihak tunduk dan berkewajiban untuk melaksanakan putusan BANI tersebut.

 

18.3

The Parties agree that the decision reached by BANI shall be a final and binding decision and the Parties shall honor such award and the Parties shall commit to execute such award.

 

 
27

 

 

18.4

Terhadap putusan BANI tersebut Para Pihak sepakat untuk mendaftarkan putusan dan permohonan eksekusi kepada kantor Panitera Pengadilan Negeri Jakarta Selatan.

 

18.4

The implementation of such award the Parties agree to elect the legal and permanent and general domicile at the office of the Clerk at the South Jakarta District Court.

 

 

 

 

 

18.5

Biaya-biaya yang timbul berkaitan dengan pelaksanaan keputusan BANI oleh Pengadilan Negeri akan ditanggung oleh pihak yang melaksanakan keputusan BANI tersebut.

 

18.5

The costs which arise as an implementation to this BANI award by the District Court shall be borne by the party implementing such award.

 

 

 

 

 

18.6

Selama berlangsungnya proses di BANI, Pihak Kedua tetap berkewajiban untuk membayar Harga Sewa, Service Charge dan Biaya-biaya Lainnya.

 

18.6

During the BANI proceedings, the Second Party shall still be obliged to pay the Rental Price, Service Charge, and Other Costs.

 

 

 

 

 

Pasal 19

Ketentuan-Ketentuan Lain

 

ARTICLE 19

OTHER PROVISIONS

 

 

 

 

 

19.1

Perjanjian ini tidak akan berakhir karena (i) dibubarkannya Pihak Pertama dan/atau (ii) dibubarkannya dan/atau meninggalnya Pihak Kedua dan/atau (iii) dijualnya Plaza Asia kepada pihak ketiga, sebelum Jangka Waktu Sewa berakhir, atau diakhiri menurut ketentuan Perjanjian, tetapi akan terus berlaku dan harus dipenuhi oleh para ahli waris atau pihak yang menurut hukum wajib meneruskan hak dan kewajiban dari pihak yang meninggal atau dibubarkan tersebut, serta terikat pada ketentuan-ketentuan yang termaktub dalam Perjanjian.

 

19.1

This Agreement shall not terminate due to the (i) dissolvement of the First Party and/or (ii) the dissolvement and/or death of the Second Party and/or (iii) the sale of Plaza Asia to a third party, prior to the expiration of the Lease Period, or is terminated in accordance with this Agreement, but shall still survive and must be fulfilled by the beneficiaries or the parties which according to the laws are obliged to continue such rights and obligations from the deceased party or the party dissolved, and shall be bound by the provisions contained in this Agreement.

 

 

 

 

 

19.2

Semua lampiran yang disebutkan dalam Perjanjian atau lampiran-lampiran/perjanjian tambahan yang akan dibuat kemudian oleh kedua-belah pihak merupakan bagian yang tidak terpisahkan dari Perjanjian ini.

 

19.2

All of the attachments mentioned in this Agreement or attachments / additional agreements which shall be made by both parties shall form an inseparable part to this Agreement.

 

 

 

 

 

19.3

Para Pihak sepakat bahwa batalnya demi hukum atau pembatalan salah satu ketentuan dalam Perjanjian ini tidak akan mengakibatkan batalnya atau pembatalan ketentuan-ketentuan lain dalam Perjanjian ini dan Para Pihak berkewajiban untuk mengganti ketentuan yang batal atau yang dibatalkan tersebut dengan suatu ketentuan lain yang sah menurut hokum.

 

19.3

The Parties agree that the annulment by law or the invalidity of any of the provisions in this Agreement shall not terminate or void the other provisions mentioned in this Agreement and the Parties are obliged to replace such invalid provisions with other lawful provisions.

 

 

 

 

 

19.4

Mengenai segala hal yang belum ataupun tidak cukup diatur dalam Perjanjian ini akan diselesaikan berdasarkan musyawarah untuk mencapai mufakat antara kedua belah pihak.

 

19.4

Regarding all matters which had not been stipulated or adequately stipulated in this Agreement shall be settled through a consensus to reach an agreement.

 

 
28

 

 

19.5

 

Semua kuasa dan wewenang yang diberikan oleh Pihak Kedua kepada Pihak Pertama dalam Perjanjian ini tidak dapat ditarik kembali dan tidak akan berakhir karena sebab apapun termasuk tetapi tidak terbatas pada sebab-sebab yang tersebut dalam Pasal-pasal 1813, 1814 dan pasal 1816 Kitab Undang-Undang Hukum Perdata dan Pihak Kedua setuju untuk mengenyampingkan ketentuan - ketentuan tersebut.

 

19.5

All powers and authority given by the Second Party to the First Party in this Agreement shall not be revoked and shall not terminate due to whatever reason including but not limited to reasons mentioned in Articles 1813, 1814, and 1816 of the Code of Civil and the Second Party agrees to waive such provisions.

 

 

 

 

 

19.6

Pemberitahuan kepada Pihak Pertama maupun Pihak Kedua sebagaimana disebutkan dalam Lampiran 6 Perjanjian ini.

 

19.6

The notification to the First Party and the Second Party is as mentioned in Attachment 6 to this Agreement.

 

 

 

 

 

19.7

Perjanjian ini dibuat dalam 2 (dua) bahasa yaitu Bahasa Indonesia dan Bahasa Inggris. Apabila terjadi perbedaan penafsiran antara teks Bahasa Indonesia dengan teks Bahasa Inggris maka yang berlaku adalah teks dalam Bahasa Indonesia

 

19.7

This Agreement is made bilingual in Indonesian and English. Should there be any difference of interpretation between the Indonesian and English text, Indonesian text shall prevail.

 

 

 

 

 

Perjanjian ini dibuat dalam rangkap 2 (dua), bermeterai cukup dan mempunyai kekuatan hukum yang sama serta ditandatangani oleh Para Pihak pada hari dan tanggal tersebut pada awal Perjanjian ini.

 

This Agreement is made in duplicate, given adequate stamp duty and has equal binding powers and is signed by the Parties on the day and date first mentioned in the beginning of this Agreement.

 

 

 

 

 

First Party

PT. GUNUNG MARAS LESTARI

 

Second Party

PT. TOGA INTERNATIONAL INDONESIA

 

 

 

 

 

 

__________________________

 

________________________

Nama : Karli Boenjamin

Jabatan : Direktur

 

Name: Cecilia Tjahjadi

Title :

  

 
29

 

  

LAMPIRAN 1

 

Lampiran ini (untuk selanjutnya disebut sebagai ”Lampiran 1”)merupakan lampiran yang tidak terpisahkan dari Perjanjian Sewa Menyewa Ruangan Perkantoran (untuk selanjutnya disebut ”Perjanjian”) antara PT Gunung Maras Lestai dan PT. Toga International Indonesia Nomor: 005/Plaza Asia/LA/XII/2017, Tanggal 18 Desember 2017. Seluruh ketentuan yang disebutkan dalam Perjanjian berlaku secara mutatis mutandis terhadap Lampiran 1 ini.

 

RINCIAN RUANGAN SEWA

 

Lantai            : 2

 

Zone             : C

 

Luas             : 218,50 m2 (Semi Gross)

 

Denah penataan Ruangan Sewa sebagaimana diatur dalam Pasal 6 Perjanjian merupakan bagian yang tidak terpisahkan dari Lampiran 1 ini.

 

ATTACHMENT 1

 

This Attachment (hereinafter referred to as “Attachment 1”) shall form an inseparable part to the Office Space Lease Agreement (hereinafter referred to as the “Agreement”) between PT. Gunung Maras Lestari and PT. Toga International Indonesia Number: 005/Plaza Asia/LA/XII/2017 dated 18 December 2017. All of the provisions mentioned in the Agreement shall be effective vice versa towards this Attachment.

 

DETAILS OF THE LEASED PREMISES

 

Floor             : 2

 

Zone             : C

 

Coverage      : 218,50 Sqm (Semi Gross)

 

The lay out of the Leased Premises design as stipulated in Article 6 of this Agreement shall form an inseparable part to this Attachment 1.

 

 
30

 

 

LAMPIRAN 2

 

Lampiran ini (untuk selanjutnya disebut sebagai ”Lampiran 2”) merupakan lampiran yang tidak terpisahkan dari Perjanjian Sewa Menyewa Ruangan Perkantoran (untuk selanjutnya disebut ”Perjanjian”) antara PT. Gunung Maras Lestari dan PT. Toga International Indonesia Nomor: 005/Plaza Asia/LA/XII/2017, Tanggal 18 Desember 2017. Seluruh ketentuan yang disebutkan dalam Perjanjian berlaku secara mutatis mutandis terhadap Lampiran 2 ini.

 

ATTACHMENT 2

 

This Attachment (hereinafter referred to as “Attachment 2”) shall form an inseparable part to the Office Space Lease Agreement (hereinafter referred to as the “Agreement”) between PT. Gunung Maras Lestari and PT. Toga International Indonesia Number: 005/Plaza Asia/LA/XII/2017 dated 18 December 2017. All of the provisions mentioned in the Agreement shall be effective vice versa towards this Attachment.

 

 

 

JANGKA WAKTU SEWA

DAN GRACE PERIOD

 

LEASE PERIOD

AND GRACE PERIOD

 

 

 

 

 

1.

Jangka Waktu Sewa menurut perjanjian ini adalah 1 (satu) tahun, yang dimulai pada tanggal 1 Februari 2018 ( 1 - 02 - 2018 ) dan akan berakhir pada tanggal 31 Januari 2019 (31 – 01 – 2019 )

 

1.

The Lease Period in accordance with this Agreement is 1 (one) year, which shall commence on the 1st February 2018 ( 1-02-2018 ) and shall terminate on the 31st January 2019 ( 31-01- 2019) .

 

 

 

 

 

2.

Lamanya Grace Period adalah 1 ( satu ) bulan terhitung sejak tanggal 2 Januari 2018 yaitu pada saat Berita Acara Serah Terima Awal dan berakhir pada tanggal 31 Januari 2018.

 

2.

The duration of Grace Period shall be 1 (one) month calendar days, starting from date 2nd January 2018 and shall terminate on the 31st January 2018.

 

 
31

 

 

LAMPIRAN 3

 

Lampiran ini (untuk selanjutnya disebut sebagai ”Lampiran 3”) merupakan lampiran yang tidak terpisahkan dari Perjanjian Sewa Menyewa Ruangan Perkantoran (untuk selanjutnya disebut ”Perjanjian”) antara PT . Gunung Maras Lestari dan PT. Toga International Indonesia Nomor:.005/PlazaAsia/LA/XII/2017, Tanggal 18 Desember 2017. Seluruh ketentuan yang disebutkan dalam Perjanjian berlaku secara mutatis mutandis terhadap Lampiran 3 ini.

 

HARGA SEWA

 

ATTACHMENT 3

 

This Attachment (hereinafter referred to as “Attachment 3”) shall form an attachment inseparable to the Office Space Lease Agreement (hereinafter referred to as the “Agreement”) between PT. Gunung Maras Lestari and PT. Toga International Indonesia Number: 005/Plaza Asia/LA/XII/2017 dated 18 December 2017 All of the provisions mentioned in the Agreement shall be effective vice versa towards this Attachment.

 

RENTAL PRICE

 

 

 

 

 

 

 

1.

Harga Sewa Ruangan sebagai berikut : Harga sewa IDR 200,000/m2/bulan, belum termasuk PPN 10 %

 

1.

The Rental Price of the Leased :

IDR 200,000/sqm/month, excluding VAT 10 %

 

 

 

 

 

 

 

2.

Harga Sewa wajib dibayarkan oleh Pihak Kedua kepada Pihak Pertama setiap 1 (satu) tahun di muka.

 

2.

The Rental will be paid by the second party to the first party on a 1 ( one ) year in advance.

 

 

 

 

 

 

 

3.

Bersamaan dengan penandatanganan Perjanjian ini, Pihak Kedua wajib membayar jaminan Harga Sewa dan Service Charge sebesar 3 (tiga) bulan seluruhnya sejumlah IDR 155,681,250

 

3.

The Second Party has paid the Rental Price & Service Charge Deposit in the total amount of IDR 155,681,250

 

 

 

 

 

 

 

Jaminan Harga Sewa dan Service Charge akan dikembalikan kepada Pihak Kedua dengan tanpa disertai bunga ataupun apabila Jangka Waktu Sewa berakhir, dan Pihak Kedua wajib menyerahkan tanda penerimaan asli bukti pembayaran Jaminan Harga Sewa, dalam jangka waktu 1 (satu) bulan setelah berakhirnya Jangka Waktu Sewa.

 

The Rental Price and Service Charge Deposit shall be refunded to the Second Party without any interest or if the Lease Period terminates, and the Second Party is obliged to submit the copy of Transfer Form or copy of Receipt of the Rental Price Deposit, within 1 (one) month after the termination of the Lease Period.

 

 

 

 

 

 

 

4.

Tata Cara Pembayaran Harga Sewa Ruangan Sewa adalah sebagai berikut:

 

4.

The method of payment of the Rental Price of the Office Space are as follows:

 

 

 

 

 

 

 

 

a.

Dalam hal pembayaran dilakukan dengan cek atau Giro Bilyet, maka pembayaran baru dianggap sah apabila jumlah uang yang tertulis dalam cek atau Giro Bilyet yang bersangkutan sudah diterima oleh Pihak Pertama atau sudah dipindah-bukukan kedalam rekening Bank Pihak Pertama.

 

 

a.

If such payment is made by cheque or clearing cheque, such payment shall be deemed valid if the amount mentioned in the cheque or clearing cheque shall be received by the First Party or transferred to the bank account of the First Party

  

 
32

 

 

 

b.

Apabila pembayaran dilakukan dalam mata uang Rupiah, maka jumlah yang diterima oleh Pihak Pertama harus sama dengan nilai Dollar Amerika Serikat, kalau dikonversikan berdasarkan kurs yang ditetapkan sesuai dengan Perjanjian ini.

 

 

b.

If payment is made in IDR Rupiah, the payment received by the First Party must be equivalent to the value of the United States Dollar, if converted to the prevailing currency rate in compliance with this Agreement.

 

 

 

 

 

 

 

 

c.

Pada dasarnya pembayaran Harga Sewa, Service Charge dan Biaya-Biaya Lain wajib dilakukan oleh Pihak Kedua dengan giro/cek/transfer ke rekening Pihak Pertama, kecuali dalam keadaan memaksa maka pembayaran dapat dilakukan dengan uang tunai.

 

 

c.

Basically payment of the Rental Price, Service Charge and Other Costs are obligated to be paid by the Second Party through the clearing / cheque / transfer to the bank account of the First Party, except due to force majeure such payment shall be made in cash.

 

 

 

 

 

 

 

 

d.

Pembayaran yang dilakukan dengan uang tunai harus dilakukan langsung kepada Pihak Pertama melalui petugas Pihak Pertama yang berwenang menerima pembayaran, yakni Kepala Bagian Kas bersama dengan Kepala Bagian Keuangan di Kantor Pihak Pertama dan bukti penerimaan pembayaran hanya sah berupa tanda terima tertulis yang di tandatangani oleh orang-orang tersebut di atas.

 

 

d.

Payment made in cash shall be made directly to the First Party through the personnel of the First Party authorized to receive such payment, namely the Head Cashier together with the Head of Finance Section at the office of the First Party and evidence of the receipt shall only be valid in the form of a written receipt signed by the above mentioned authorized personnel.

 

 
33

 

 

LAMPIRAN 4

 

Lampiran ini (untuk selanjutnya disebut sebagai ”Lampiran 4”)merupakan lampiran yang tidak terpisahkan dari Perjanjian Sewa Menyewa Ruangan Perkantoran (untuk selanjutnya disebut ”Perjanjian”) antara PT. Gunung Maras Lestari dan PT. Toga International Indonesia Nomor: 005/Plaza Asia/LA/XII/2017, Tanggal 18 Desember 2017. Seluruh ketentuan yang disebutkan dalam Perjanjian berlaku secara mutatis mutandis terhadap Lampiran 4 ini.

 

FASILITAS

 

ATTACHMENT 4

 

This Attachment (hereinafter referred to as “Attachment 4”) shall form an attachment inseparable to the Office Space Lease Agreement (hereinafter referred to as the “Agreement”) between PT. Gunung Maras Lestari and PT. Toga International Indonesia Number: 005/Plaza Asia/LA/XII/2017 dated 18 December 2017. All of the provisions mentioned in the Agreement shall be effective vice versa towards this Attachment.

 

FACILITIES

 

 

 

 

 

 

 

 

a.

Listrik

 

 

a.

Electricity

 

 

 

 

 

 

 

 

 

Terpisah pembayaran sesuai dengan KWH Meter dengan tarif PLN ditambah biaya adminitrasi

 

 

 

Separate by KWH Meter it is PLN Tarif charge plus administration cost.

 

 

 

 

 

 

 

 

b.

Air Conditioning

 

 

b.

Air Conditioning

 

 

 

 

 

 

 

 

 

VRV, terpisah sesuai dengan pemakaian yang tercantum dalam KWH Meter.

 

 

 

VRV, separate by KWH Meter,

 

 

 

 

 

 

 

 

 

Penggunaan Air Conditioning di luar Jam Kerja akan dikenakan biaya tambahan.

 

 

 

There shall be an additional charge for each floor for the use of air conditioning outside of Working Hours.

 

 

 

 

 

 

 

 

c.

Air

 

 

c.

Water

 

 

 

 

 

 

 

 

 

Deep Well/PAM , untuk penggunaan air selain dari fungsi perkantoran akan diterapkan penggunaan meter air dan dikenai biaya sesuai dengan pemakaian air.

 

 

 

Deep Well water or Perusahaan Air Minum (State owned water company). There shall be additional water charges if the Leased Premises is utilized other than for office space, which shall be calculated from the water meter installed specially for such purpose and shall be charged additionally for such use.

 

 

 

 

 

 

 

 

d.

Parkir

 

 

d.

Parking

 

 

 

 

 

 

 

 

 

Reserved parking dengan biaya IDR 417,000/mobil/bulan

Unreserved parking dengan biaya IDR. 210,000/mobil/bulan

 

 

 

The charge for reserved parking is

IDR 417,000 /lot/month.

 

 

 

 

 

 

 

 

 

 

 

 

 

The charge for unreserved parking is

IDR 210,000 /lot/month.

 

 
34

 

 

 

e.

Keamanan

 

 

e.

Security

 

 

 

 

 

 

 

 

 

24 (dua puluh empat) jam setiap hari.

 

 

 

Available 24 (twenty four) hours a day.

 

 

 

 

 

 

 

 

f.

Lift

 

 

f.

Elevators

 

 

 

 

 

 

 

 

 

4 (empat) buah lift penumpang Low Zone

4 ( empat ) buah lift penumpang High Zone

1 ( satu ) lift barang

2 (dua) lift parkir

 

 

 

4(four) passenger elevators Low Zone

4(four) passenger elevators High Zone

1 ( one ) passenger elevator service

2 ( two ) passenger elevator parking

 

 

 

 

 

 

 

 

g.

Peralatan Sanitary

 

 

g.

Sanitary Equipment

 

 

 

 

 

 

 

 

 

Kertas tissue dan sabun pencuci tangan terdapat di setiap toilet yang ada pada Bangunan

 

 

 

Tissue paper and hand washing soap is available in every toilet in the Building.

 

 
35

 

 

LAMPIRAN 5

 

Lampiran ini (untuk selanjutnya disebut sebagai ”Lampiran 5”) merupakan lampiran yang tidak terpisahkan dari Perjanjian Sewa Menyewa Ruangan Perkantoran (untuk selanjutnya disebut ”Perjanjian”) antara PT. Gunung Maras Lestari dan PT. Toga International Indonesia Nomor: 005/Plaza Asia/LA/XII/2017, Tanggal .18 Desember 2017. Seluruh ketentuan yang disebutkan dalam Perjanjian berlaku secara mutatis mutandis terhadap Lampiran 5 ini.

 

ATTACHMENT 5

 

This Attachment (hereinafter referred to as “Attachment 5”) shall form an attachment inseparable to the Office Space Lease Agreement (hereinafter referred to as the “Agreement”) between PT. Gunung Maras Lestari and PT. Toga International Indonesia Number: 005/Plaza Asia/LA/XII/2017 dated 18 December 2017. All of the provisions mentioned in the Agreement shall be effective vice versa towards this Attachment.

 

 

 

 

SERVICE CHARGE DAN BIAYA-BIAYA LAINNYA

SERVICE CHARGE

 

 

SERVICE CHARGE AND OTHER COSTS

SERVICE CHARGE

 

 

 

 

 

 

 

1.

Sehubungan dengan penyediaan Fasilitas yang dimaksudkan dalam Pasal 8, Pihak Kedua setuju dan wajib membayar kepada Badan Pengelola Service Charge sebesar:

  

IDR 37,500 ( Tiga puluh tujuh ribu lima ratus Rupiah ) per meter persegi per bulan.

 

1.

In refer to the availability of Facilities as mentioned in Article 8, the Second Party agrees and is obligated to pay to the Building Management, a Service Charge in the amount of: IDR 37,500 ( Thirty seven thousand five hundred Rupiah ).

 

 

 

 

 

 

 

 

2.

Pihak Pertama berhak untuk setiap saat menggunakan jaminan Service Sharge untuk pelunasan Service Charge yang masih terhutang oleh Pihak Kedua (jika ada), dan pada saat pengakhiran Perjanjian ini karena alasan apa pun, jika ada kelebihan dari pelunasan tersebut maka Pihak Pertama wajib mengembalikan kelebihan pelunasan tersebut setelah pengakhiran Perjanjian ini.

 

2.

The First Party is entitled to use the Service Charge Deposit to pay the outstanding Service Charge and the other outstanding amounts by the Second Party (if any) at any time, andupon the termination of this lease due to whatever reason, if there are any remaining amounts the First Party is obligated to refund such amount upon the termination of this Agreement.

 

 

 

 

 

 

 

3.

Tata cara Pembayaran Service charge adalah 3 ( tiga ) bulanan dimuka direct kepada Badan Pengelola.

 

3.

The method of payment of the Service Charge is 3 ( three ) months in advance direct to Building Management.

 

 

 

 

 

 

 

BIAYA LAIN-LAIN

OTHER COSTS

 

 

 

 

 

 

 

1.

Biaya Listrik & Pendingin Ruangan

1.

Electricity Costs & Air Conditioning

 

 

 

 

 

 

 

 

1.1

 

Biaya pemakaian listrik dan Pendingin Ruangan akan dipungut oleh Badan Pengelola yang besarnya ditentukan oleh Badan Pengelola.

 

 

1.1

The costs of using electricity and Air Conditioning shall be collected by the Building Management which amount shall be determined by the Building Management.

   

 
36

 

 

 

1.2

Jika ada tagihan pemakaian listrik dan Pendingin Ruangan sebagaimana dimaksud butir 1.1 di atas tersebut, maka wajib dilunasi oleh Pihak Kedua selambat- lambatnya pada tanggal 20 (dua puluh) setiap bulannya.

 

 

1.2.

If there are any charges for the use of electricity and Air Conditioning as mentioned above in item 1.1, such amount is obligated to be settled by the Second Party at the latest on the 20 (twentieth) of each month.

 

 

 

 

 

 

 

 

1.3

Pihak Kedua harus membayar tambahan biaya yang besarnya ditetapkan oleh Badan Pengelola apabila menghendaki penambahan daya listrik melebihi kapasitas yang telah disediakan oleh Badan Pengelola.

 

 

1.3.

The Second Party is obligated to pay additional charges which amount shall be determined by the Building Management if there is a need to increase the electric power exceeding the capacity made available by the Building Management

 

 

 

 

 

 

 

2.

Biaya Telepon

 

2.

Telephone Costs

 

 

 

 

 

 

 

 

 2.1

Biaya pemakaian telepon dipungut sejak terpasangnya telepon dan biaya tersebut adalah sebesar tagihan dari Perusahaan Umum Telekomunikasi, dan akan ditagih oleh Badan Pengelola kepada Pihak Kedua dan wajib dilunasi oleh Pihak Kedua selambat-lambatnya pada tanggal 20 (dua puluh) setiap bulannya.

 

 

2.1

The fees for telephone use shall be charged since the telephone installation and such costs shall be the bill from the Perusahaan Umum Telekomunikasi, and shall be claimed by the Building Management to the Second Party and is obligated to be settled by the Second Party at the latest on the 20th (twentieth) of each month.

 

 

 

 

 

 

 

 

2.2

Pihak Kedua wajib membayar uang jaminan telepon atas setiap sambungan telepon dan/atau sambungan langsung (direct line) yang digunakan dalam Ruangan Sewa.

 

 

2.2

The Second Party is obligated to pay the telephone deposit for each telephone line/and or direct line used in the Leased Premises.

 

 

 

 

 

 

 

 

 

Pengembalian uang jaminan telepon akan dilakukan selambat-lambatnya 2 (dua) bulan dari Badan Pengelola setelah Jangka Waktu Sewa berakhir

 

 

 

The refund of the telephone deposit shall be made at the latest 2 (two) moths from Building Management after the termination of the Lease Period

 

 

 

 

 

3.

Tata cara pembayaran Biaya-biaya Lain adalah sebagaimana dirinci dalam Butir 5 dari Lampiran 3.

 

3.

The method of payment of the Other Costs is as mentioned in detail this Attachment 4.

 

 
37

 

 

LAMPIRAN 6

 

Lampiran ini (untuk selanjutnya disebut sebagai ”Lampiran 6”)merupakan lampiran yang tidak terpisahkan dari Perjanjian Sewa Menyewa Ruangan Perkantoran (untuk selanjutnya disebut ”Perjanjian”) antara PT. Gunung Maras Lestari dan PT. Toga International Indonesia Nomor: 005/Plaza Asia/LA/XII/2017, Tanggal 18 Desember 2017 Seluruh ketentuan yang disebutkan dalam Perjanjian berlaku secara mutatis mutandis terhadap Lampiran 6 ini.

 

ALAMAT PEMBERITAHUAN

 

ATTACHMENT 6

 

This Attachment (hereinafter referred to as “Attachment 6”) shall form an attachment inseparable to the Office Space Lease Agreement (hereinafter referred to as the “Agreement“) between PT. Gunung Maras Lestari and PT. Toga International Indonesia Number: 005/Plaza Asia/LA/XII/2017 dated 18 December 2017 . All of the provisions mentioned in the Agreement shall be effective vice versa towards this Attachment.

 

NOTIFICATON ADDRESS

 

  

 

 

 

1.

Pemberitahuan yang harus diberikan berhubung dengan Perjanjian wajib diberitahukan secara tertulis dan dikirim langsung dengan mendapat suatu tanda terima dan/atau dikirim dengan pos tercatat kepada alamat-alamat sebagai berikut:

 

1.3.1.1.

The notifications made in relation to this Agreement is obligated to be made in writing and sent directly by receiving a receipt and/or sent by registered mail to the following address:

 

 

 

 

 

 

Pihak Pertama:

PT. Gunung Maras Lestari

Office 8, Lantai 32

Lot 28 SCBD

Jl. Jend. Sudirman Kav. 52 – 53

Jakarta 12190

Telp. 62 21 29333681

 

 

First Party :

PT. Gunung Maras Lestari

Office 8, 32nd Floor Lot 28 SCB

Jl. Jend. Sudirman Kav. 52 – 53

Jakarta 12190

Telp. 62 21 29333681

 

 

 

 

 

 

Pihak Kedua:

PT. Toga International Indonesia

Menara Standard Chartered Bank, Lantai 30

Jl. Prof. Dr. Satrio No. 164

Jakarta

 

Telp. + 62 21 25555600

 

 

Second Party :

PT. Toga International Indonesia

Menara Standard Chartered Bank, 30th Floor

Jl. Prof. Dr. Satrio No. 164

Jakarta

  

Telp. +62 21 25555600

 

 

 

 

 

Jika terjadi perubahan alamat yang tercantum dalam Perjanjian maka pihak yang mengubah alamat wajib untuk memberitahukan perubahan tersebut kepada pihak lainnya dalam jangka waktu 7 (tujuh) hari setelah perubahan alamat itu terjadi atau dilakukan. Segala akibat yang timbul karena perubahan alamat yang tidak diberitahukan kepada pihak lainnya sepenuhnya menjadi resiko dan tanggungan pihak yang mengubah alamat yang bersangkutan.

 

Should there be any changes to the addresses mentioned in this Agreement, the party making such changes is obliged to notify such changes to the other parties within 7 (seven) days after the change in such address is made. All consequences which may arise as a result of such change not notified to the other party shall become the full risk and responsibility of the party making such changes.

 

 
38

 

 

EXHIBIT 10.40

 

 

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 

 

EXHIBIT 10.41

 

EXECUTIVE AGREEMENT

 

THIS EXECUTIVE AGREEMENT (this “Agreement”) is executed and effective as of February 8, 2019, by and between Toga Limited, a Nevada corporation (the “Company”), and Alexander D. Henderson, a resident of the State of California (the “Executive”).

 

Recitals

 

A. The Company and Executive desire to enter into an agreement pursuant to which Executive will serve as the Chief Financial Officer (“CFO”) of the Company on the terms and conditions set forth in this Agreement.

 

B. Certain definitions are set forth in Section 4 of this Agreement.

 

Agreement

 

The parties hereto agree as follows:

 

1. Engagement. The Company hereby engages Executive to serve as the Chief Financial Officer of the Company, and Executive agrees to serve the Company, during the Service Term (as defined in Section 1(c) hereof) in the capacities, and subject to the terms and conditions, set forth in this Agreement.

 

(a) Services. During the Service Term, Executive, as CFO, shall have all the duties and responsibilities customarily rendered by the CFO of companies of similar size and nature and as may be reasonably assigned from time to time by the Board. The CFO agrees that he will also undertake the duties and responsibilities as set forth in Schedule A attached hereto. Executive will report directly to the Company’s Group General Manager and, when the Group General Manager is not available, to the Company’s CEO. Except as otherwise provided herein, Executive will devote his best efforts and attention (except for vacation periods and periods of illness or other incapacity) to the business of the Company and its Affiliates. Notwithstanding the foregoing, and provided that such activities do not interfere with, or detract from, the fulfillment of Executive’s obligations hereunder, Executive may pursue, and perform, non- Company consulting and other projects in addition to his serving as the Company’s CFO. Unless the Company and Executive agree to the contrary, Executive’s place of business shall be at the Executive’s office in California; provided, however, that Executive will travel to such other locations of the Company and its Affiliates as may be reasonably necessary in order to discharge his duties hereunder.

 

(b) Salary, Bonus and Benefits.

 

i. Salary and Bonus. During the Service Term, the Company will pay Executive a monthly base salary (the “Monthly Base Salary”) of Ten Thousand Dollars ($10,000).

 

 

 

 

ii. In addition, the Company shall grant to the Executive options to purchase sixty thousand (60,000) shares of the Company’s common stock, par value $0.001 per share (“Common Stock”), on a cashless basis, at an exercise price of $0.20 per share (the “Options”). The Options shall be subject to vesting at the rate of one-third (⅓) every thirty (30) days but shall expire on the second anniversary of this Agreement. Executive acknowledges and agrees, that the shares of Common Stock granted to Executive in accordance with this Agreement have not been registered under the United States Securities Act of 1933 (the "Securities Act") or the securities laws of any state, and that the Common Stock upon issuance will be, "restricted securities" in the United States within the meaning of Rule 144(a)(3) of the Securities Act.

 

iii. Vacation; Benefits. Executive shall be entitled to two (2) weeks of vacation per each twelve (12) months of service to the Company, with the scheduling of such vacation time to be agreed to by the Company and Executive in advance. Executive shall not be entitled to, or receive, any other benefits from the Company. Executive must serve a term of a minimum of six (6) consecutive months as the Company’s CFO before any vacation time accrues and therefore no vacation time shall accrue under the original Service Term (as such term is defined below) of this Agreement, unless the Service Term is extended by mutual consent of the Parties.

 

(c) Executive Term. Executive’s term under this Agreement shall commence on February 1, 2019, and shall terminate on May 1, 2019 (the “Service Term”). In lieu of a subsequent agreement, this Agreement and the Service Term shall become an open-ended, at- will employment agreement, unless either party provides the other party with (a) written notice of their election to terminate this Agreement fifteen (15) calendar days prior to the expiration of the original Service Term, or (b) notice of their election to terminate this Agreement thirty (30) calendar days from the date of receipt of such written notice.

 

2. Confidential Information; Proprietary Information, etc.

 

(a) Obligation to Maintain Confidentiality. Executive acknowledges that any Proprietary Information disclosed or made available to Executive or obtained, observed or known by Executive as a direct or indirect consequence of his service or performance of services for the Company or any of its Affiliates during the course of his performance of services for any of the foregoing Persons (whether or not compensated for such services), are the property of the Company and its Affiliates. Therefore, Executive agrees that he will not at any time (whether during or after Executive’s term of service) disclose or permit to be disclosed to any Person or, directly or indirectly, utilize for his own account or permit to be utilized by any Person any Proprietary Information or Records for any reason whatsoever without the Boards consent, unless and to the extent that (except as otherwise provided in the definition of Proprietary Information) the aforementioned matters become generally known to and available for use by the public other than as a direct or indirect result of Executive’s acts or omissions to act. Executive agrees to deliver to the Company at the termination of his service, as a condition to receipt of the next or final payment of compensation, or at any other time the Company may request in writing (whether during or after Executive’s term of service), all Records which he may then possess or have under his control. Executive further agrees that any property situated on the Company’s or its Affiliates premises and owned by the Company or its Affiliates, including disks and other storage media, filing cabinets or other work areas, is subject to inspection by Company or its Affiliates and their personnel at any time with or without notice. Nothing in this Section 2(a) shall be construed to prevent Executive from using his general knowledge and experience in future employment so long as Executive complies with this Section 2(a) and the other restrictions contained in this Agreement.

 

 
2

 

 

(b) Ownership of Property. Executive acknowledges that all inventions, innovations, improvements, developments, methods, processes, programs, designs, analyses, drawings, reports and all similar or related information (whether or not patentable) that relate to the Company’s or any of its Affiliates actual or anticipated business, research and development, or existing or future products or services and that are conceived, developed, contributed to, made, or reduced to practice by Executive (either solely or jointly with others) while employed by the Company or any of its Affiliates (including any of the foregoing that constitutes any Proprietary Information or Records) (“Work Product”) belong to the Company or such Affiliate and Executive hereby assigns, and agrees to assign, all of the above Work Product to the Company or such Affiliate. Any copyrightable work prepared in whole or in part by Executive in the course of his work for any of the foregoing entities shall be deemed a work made for hire under the copyright laws, and the Company or such Affiliate shall own all rights therein. To the extent that any such copyrightable work is not a work made for hire, Executive hereby assigns and agrees to assign to Company or such Affiliate all right, title and interest, including without limitation, copyright in and to such copyrightable work. Executive shall promptly disclose such Work Product and copyrightable work to the Board and perform all actions reasonably requested by the Board (whether during or after Executive’s term of service) to establish and confirm the Company’s or its Affiliates ownership (including, without limitation, execution of assignments, consents, powers of attorney and other instruments). Notwithstanding anything contained in this Section 2(b) to the contrary, the Company’s ownership of Work Product does not apply to any invention that Executive develops entirely on his own time without using the equipment, supplies or facilities of the Company or its Affiliates or Subsidiaries or any Proprietary Information (including trade secrets), except that the Company’s ownership of Work Product does include those inventions that: (a) relate to the business of the Company or its Affiliates or Subsidiaries or to the actual or demonstrably anticipated research or development relating to the Company’s business; or (b) result from any work that Executive performs for the Company or its Affiliates or Subsidiaries.

 

(c) Third Party Information. Executive understands that the Company and its Affiliates will receive from third parties confidential or proprietary information (“Third Party Information”) subject to a duty on the Company’s and its Affiliates part to maintain the confidentiality of such information and to use it only for certain limited purposes. During the term of Executive’s service and thereafter, and without in any way limiting the provisions of Sections 2(a) and 2(b) above, Executive shall hold Third Party Information in the strictest confidence and shall not disclose to anyone (other than personnel of the Company or its Affiliates who need to know such information in connection with their work for the Company or its Affiliates) or use, except in connection with his work for the Company or its Affiliates, Third Party Information unless expressly authorized by a member of the Board in writing.

 

(d) Use of Information of Prior Employers, etc. Executive will abide by any enforceable obligations contained in any agreements that Executive has entered into with his prior employers or other parties to whom Executive has an obligation of confidentiality.

 

 
3

 

 

(e) Compelled Disclosure. If Executive is required by law or governmental regulation or by subpoena or other valid legal process to disclose any Proprietary Information or Third Party Information to any Person, Executive will immediately provide the Company with written notice of the applicable law, regulation or process so that the Company may seek a protective order or other appropriate remedy. Executive will cooperate fully with the Company and the Company’s Representatives in any attempt by the Company to obtain any such protective order or other remedy. If the Company elects not to seek, or is unsuccessful in obtaining, any such protective order or other remedy in connection with any requirement that Executive disclose Proprietary Information or Third Party Information, and if Executive furnishes the Company with a written opinion of reputable legal counsel acceptable to the Company confirming that the disclosure of such Proprietary Information or Third Party Information is legally required, then Executive may disclose such Proprietary Information or Third Party Information to the extent legally required; provided, however, that Executive will use his reasonable best efforts to ensure that such Proprietary Information is treated confidentially by each Person to whom it is disclosed.

 

3. Non-solicitation.

 

(a) Non-solicitation. As long as Executive is an executive of the Company or any Affiliate thereof, and for twelve (12) months thereafter, Executive shall not directly or indirectly through another entity: (i) induce or attempt to induce any employee of the Company or any Affiliate to leave the employ of the Company or such Affiliate, or in any way interfere with the relationship between the Company or any Affiliate and any employee thereof; (ii) hire or employ any person who was an employee of the Company or any Affiliate at any time preceding the date of such Executive’s termination.

 

(b) Acknowledgment. Executive acknowledges that in the course of his service with the Company and its Affiliates, he has and will become familiar with the trade secrets and other Proprietary Information of the Company and its Affiliates. It is specifically recognized by Executive that his services to the Company and its Subsidiaries are special, unique and of extraordinary value, that the Company has a protectable interest in prohibiting Executive as provided in this Section 3, that money damages are insufficient to protect such interests, that there is adequate consideration being provided to Executive hereunder, that such prohibitions are necessary and appropriate without regard to payments being made to Executive hereunder and that the Company would not enter this Agreement with Executive without the restriction of this Section 3. Executive further acknowledges that the restrictions contained in this Section 3 do not impose an undue hardship on him and, since he has general business skills which may be used in industries other than that in which the Company and its Subsidiaries conduct their business, do not deprive Executive of his livelihood. Executive further acknowledges that the provisions of this Section 3 are separate and independent of the other sections of this Agreement.

 

(c) Enforcement, etc. If, at the time of enforcement of Section 2 or 3 of this Agreement, a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration, scope or geographical area reasonable under such circumstances as determined by the court shall be substituted for the stated period, scope or area. Because Executive’s services are unique, because Executive has access to Proprietary Information and for the other reasons set forth herein, the parties hereto agree that money damages would be an inadequate remedy for any breach of this Agreement. Therefore, without limiting the generality of Section 7(g), in the event of a breach or threatened breach of this Agreement, the Company or its successors or assigns may, in addition to other rights and remedies existing in their favor, apply to any court of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof.

 

 
4

 

 

(d) Submission to Jurisdiction. The parties hereby: (i) submit to the jurisdiction of any state or federal court sitting in Nevada in any action or proceeding arising out of or relating to Section 2 and/or 3 of this Agreement; (ii) agree that all claims in respect of such action or proceeding may be heard or determined in any such court; and (iii) agree not to bring any action or proceeding arising out of or relating to Section 2 and/or 3 of this Agreement in any other court. The parties hereby waive any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety or other security that might be required of any other party with respect thereto. The parties hereby agree that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by suit on the judgment or in any other manner provided by law.

 

GENERAL PROVISIONS

 

4. Definitions.

 

“Affiliate” of any Person means any other Person which directly or indirectly controls, is controlled by or is under common control with such Person.

 

“Board” means the Company’s board of directors or the board of directors or similar management body of any successor of the Company.

 

“Proprietary Information” means any and all data and information concerning the business affairs of the Company or any of its Affiliates and not generally known in the industry in which the Company or any of its Affiliates is or may become engaged, and any other information concerning any matters affecting or relating to the Company’s or its Affiliates businesses, but in any event Proprietary Information shall include, any of the Company’s and its Affiliates past, present or prospective business opportunities, including information concerning acquisition opportunities in or reasonably related to the Company’s or its Affiliates businesses or industries, customers, customer lists, clients, client lists, the prices the Company and its Affiliates obtain or have obtained from the sale of, or at which they sell or have sold, their products, unit volume of sales to past or present customers and clients, or any other information concerning the business of the Company and its Affiliates, their manner of operation, their plans, processes, figures, sales figures, projections, estimates, tax records, personnel history, accounting procedures, promotions, supply sources, contracts, know-how, trade secrets, information relating to research, development, inventions, software, techniques, technology, manufacture, purchasing, engineering, marketing, merchandising or selling, or other data without regard to whether all of the foregoing matters will be deemed confidential, material or important. Proprietary Information does not include any information which Executive has obtained from a Person other than an employee of the Company, which was disclosed to him without a breach of a duty of confidentiality.

 

 
5

 

 

“Records” means (i) any and all procedure manuals, books, records and accounts; (ii) all property of the Company and its Affiliates, including papers, note books, tapes and similar repositories containing Proprietary Information; (iii) all invoices and commission reports; (iv) customer lists partial and/or complete; (v) data layouts, magnetic tape layouts, diskette layouts, etc.; (vi) samples; (vii) promotional letters, brochures and advertising materials; (viii) displays and display materials; (ix) correspondence and old or current proposals to any former, present or prospective customer of the Company and its Affiliates; (x) information concerning revenues and profitability and any other financial conditions of the Company and its Affiliates; (xi) information concerning the Company and its Affiliates which was input by Executive or at his direction, under his supervision or with his knowledge, including on any floppy disk, diskette, cassette or similar device used in, or in connection with, any computer, recording devices or typewriter; (xii) data, account information or other matters furnished by customers of the Company and its Affiliates; and (xiii) all copies of any of the foregoing data, documents or devices whether in the form of carbon copies, photo copies, copies of floppy disks, diskettes, tapes or in any other manner whatsoever.

 

“Person” means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.

 

“Subsidiary” means any corporation of which the Company owns securities having a majority of the ordinary voting power in electing the board of directors directly or through one or more subsidiaries.

 

5. Notices. Any notice or other writing required or permitted to be given hereunder or for the purposes hereof shall be sufficiently given if delivered to the party to whom it is given or, if mailed, by prepaid registered mail, or sent by email, addressed to such party at:

 

If to Executive:

 

Alexander D. Henderson

460 White Cap Lane

Newport Coast, CA 92657

Email: alexhenderson.toga@gmail.com

 

If to the Company:

 

Toga Limited

3960 Howard Hughes Pkwy

Suite 500

Las Vegas, Nevada

Email: stevetan2016@gmail.com and wsl@boothudall.com

 

or at such other physical address as the party to whom such writing is to be given shall have last notified to the party giving the same in the manner provided in this article. Written notice hereunder, shall be delivered personally or sent to each party by (i) personal delivery; (ii) a nationally-recognized, next-day courier service; (iii) first-class registered or certified mail, postage prepaid or (iv) electronic mail. In the case of delivery by certified mail, such mailing shall be deemed to have been delivered following deposit with the U.S. Postal Service, if deposited at a United States post office five (5) calendar days following deposit with the U.S. Postal Service. In the case of overnight delivery, delivery shall be deemed to be completed upon receipt of the notice at the address provided. In the case of email delivery, delivery shall be deemed to be completed upon the email message having been sent.

 

 
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6. Executive’s Representations and Warranties. Executive represents and warrants that he has full and authority to enter into this Agreement and fully to perform his obligations hereunder, that he is not subject to any non-competition agreement, and that his past, present and anticipated future activities have not and will not infringe on the proprietary rights of others, including, but not limited to, proprietary information rights or interfere with any agreements he has with any prior employee. Executive further represents and warrants that he is not obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, which would conflict with or result in a breach of this Agreement or which would in any manner interfere with the performance of his duties for the Company.

 

7. General Provisions.

 

(a) Expenses. Each party shall bear his or its own expenses in connection with the negotiation and execution of this Agreement and the consummation of the transactions contemplated by this Agreement.

 

(b) Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

 

(c) Complete Agreement. This Agreement, those documents expressly referred to herein and other documents of even date herewith embody the complete agreement and understanding among the parties and supersede and preempt any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.

 

(d) Counterparts; Facsimile Transmission. This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement. Each party to this Agreement agrees that it will be bound by its own telecopied, or electronic, signature and that it accepts the telecopied, or electronic, signature of each other party to this Agreement.

 

(e) Successors and Assigns; Merger or Sale of Assets. Except as otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable by Executive, the Company and their respective successors and assigns; provided that the rights and obligations of Executive under this Agreement shall not be assignable.

 

 
7

 

 

(f) Choice of Law; Jurisdiction. All questions concerning the construction, validity and interpretation of this Agreement and the exhibits hereto will be governed by and construed in accordance with the internal laws of the State of Nevada, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Nevada or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Nevada. The parties hereby: (i) submit to the jurisdiction of any state or federal court sitting in Nevada in any action or proceeding arising out of or relating to Agreement; (ii) agree that all claims in respect of such action or proceeding may be heard or determined in any such court; and (iii) agree not to bring any action or proceeding arising out of or relating to this Agreement in any other court. Executive hereby waives any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety or other security that might be required of any other party with respect thereto. The parties hereby agree that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by suit on the judgment or in any other manner provided by law.

 

(g) Remedies. Each of the parties to this Agreement will be entitled to enforce its rights under this Agreement specifically, to recover damages and costs (including attorneys’ fees) caused by any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent any violations of the provisions of this Agreement.

 

(h) Amendment and Waiver. The provisions of this Agreement may be amended or and waived only with the prior written consent of the Company and the Executive.

 

(i) Business Days. If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or holiday in the state in which the Company’s chief executive office is located, the time period shall be automatically extended to the business day immediately following, such Saturday, Sunday or holiday.

 

(j) Termination. This Agreement shall survive the termination of Executive’s employment with the Company and shall remain in full force and effect after such termination.

 

(k) No Waiver. A waiver by any party hereto of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which such party would otherwise have on any future occasion. No failure to exercise nor any delay in exercising on the part of any party hereto, any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided are cumulative and may be exercised singly or concurrently, and are not exclusive of any rights or remedies provided by law.

 

(l) Offset. Whenever the Company or any of its Subsidiaries is obligated to pay any sum to Executive or any Affiliate or related person thereof pursuant to this Agreement, any bona fide debts that Executive or such Affiliate or related person owes to the Company or any of its Subsidiaries may be deducted from that sum before payment.

 

(m) Indemnification and Reimbursement of Payments on Behalf of Executive. The Executive shall be responsible for the payment of any federal, state, provincial, local or foreign withholding taxes, excise taxes, or employment taxes (“Taxes”) imposed with respect to Executive’s compensation or other payments from the Company or any of its Subsidiaries or Executive’s ownership interest in the Company, including, but not limited to, wages, or the receipt of stock. In the event the Executive should fail to make any such payments, the Executive indemnifies the Company for any claims, causes or action, or liabilities which may be made, advanced or incurred against the Company as a result of such non-payment, and agrees to be responsible for the Company’s attorneys’ fees and related costs in defending or protecting itself.

 

 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first written above.

 

 

Executive:

 

 

 

 

 

/s/ Alexander D. Henderson

 

 

Alexander D. Henderson

 

 

 

 

 

 

 

 

Company:

 

Toga Limited

       
By:

 

Name:

 
  Its:  
       

 

 
9

 

EXHIBIT 10.42

 

AMENDED AND RESTATED EXECUTIVE AGREEMENT

 

THIS AMENDED AND RESTATED EXECUTIVE AGREEMENT (this “Amended Agreement”) is executed and effective as of May 1, 2019, by and between Toga Limited, a Nevada corporation (the “Company”), and Alexander D. Henderson, a resident of the State of California (the “Executive”).

 

Recitals

 

A. As of February 8, 2019, the Company and the Executive entered into an Executive Agreement (the “Original Agreement”) whereby the Company appointed the Executive as the Company’s Chief Financial Officer (“CFO”) on the terms and conditions set forth therein.

 

B. The Original Agreement had a term of three (3) months, which expired on May 1, 2019 and the parties now wish to enter into this Amended Agreement to amend and restate the terms agreed to between the parties.

 

C. Certain definitions are set forth in Section 4 of this Amended Agreement.

 

Agreement

 

The parties hereto agree as follows:

 

1. Engagement. The Company hereby engages Executive to serve as the Chief Financial Officer of the Company, and Executive agrees to serve the Company, during the Service Term (as defined in Section 1(c) hereof) in the capacities, and subject to the terms and conditions, set forth in this Amended Agreement.

 

(a) Services. During the Service Term, Executive, as CFO, shall have all the duties and responsibilities customarily rendered by the CFO of companies of similar size and nature and as may be reasonably assigned from time to time by the Board. The CFO agrees that he will also undertake the duties and responsibilities as set forth in Schedule A attached hereto. Executive will report directly to the Company’s Group General Manager and, when the Group General Manager is not available, to the Company’s CEO. Except as otherwise provided herein, Executive will devote his best efforts and attention (except for vacation periods and periods of illness or other incapacity) to the business of the Company and its Affiliates. Notwithstanding the foregoing, and provided that such activities do not interfere with, or detract from, the fulfillment of Executive’s obligations hereunder, Executive may pursue, and perform, non-Company consulting and other projects in addition to his serving as the Company’s CFO. Unless the Company and Executive agree to the contrary, Executive’s place of business shall be at the Executive’s office in California; provided, however, that Executive will travel to such other locations of the Company and its Affiliates as may be reasonably necessary in order to discharge his duties hereunder.

 

 

 

 

(b) Salary, Bonus and Benefits.

 

i. Salary and Bonus. For a period of three (3) months commencing on the date of this Amended Agreement, the Company will pay Executive a monthly base salary (the “Monthly Base Salary”) of Twelve Thousand Dollars ($12,000). After such three (3) month period, the parties shall negotiate and come to an agreement on a new monthly compensation.

 

ii. In addition, upon execution hereof and every ninety (90) days thereafter during the term of this Amended Agreement, the Company shall grant to the Executive options to purchase sixty thousand (60,000) shares of the Company’s common stock, par value $0.001 per share (“Common Stock”), at an exercise price of $0.40 per share (the “Options”). The Options shall be subject to vesting at the rate of one-third (⅓) every thirty (30) days but shall expire on the second anniversary of this Amended Agreement. Executive acknowledges and agrees, that the shares of Common Stock granted to Executive in accordance with this Amended Agreement have not been registered under the United States Securities Act of 1933 (the "Securities Act") or the securities laws of any state, and that the Common Stock upon issuance will be, "restricted securities" in the United States within the meaning of Rule 144(a)(3) of the Securities Act.

 

iii. Vacation; Benefits. Executive shall be entitled to two (2) weeks of vacation per each twelve (12) months of service to the Company, with the scheduling of such vacation time to be agreed to by the Company and Executive in advance. Executive shall not be entitled to, or receive, any other benefits from the Company. Executive must serve a term of a minimum of six (6) consecutive months as the Company’s CFO before any vacation time accrues and therefore no vacation time shall accrue under the original Service Term (as such term is defined below) of this Amended Agreement, unless the Service Term is extended by mutual consent of the Parties.

 

(c) Executive Term. Executive’s term under this Amended Agreement shall commence on May 1, 2019, and shall terminate on April 30, 2020 (the “Service Term”). In lieu of a subsequent agreement, this Amended Agreement and the Service Term shall become an open- ended, at-will employment agreement, unless either party provides the other party with (a) written notice of their election to terminate this Amended Agreement fifteen (15) calendar days prior to the expiration of the original Service Term, or (b) notice of their election to terminate this Amended Agreement thirty (30) calendar days from the date of receipt of such written notice.

 

2. Confidential Information; Proprietary Information, etc.

 

(a) Obligation to Maintain Confidentiality. Executive acknowledges that any Proprietary Information disclosed or made available to Executive or obtained, observed or known by Executive as a direct or indirect consequence of his service or performance of services for the Company or any of its Affiliates during the course of his performance of services for any of the foregoing Persons (whether or not compensated for such services), are the property of the Company and its Affiliates. Therefore, Executive agrees that he will not at any time (whether during or after Executive’s term of service) disclose or permit to be disclosed to any Person or, directly or indirectly, utilize for his own account or permit to be utilized by any Person any Proprietary Information or Records for any reason whatsoever without the Boards consent, unless and to the extent that (except as otherwise provided in the definition of Proprietary Information) the aforementioned matters become generally known to and available for use by the public other than as a direct or indirect result of Executive’s acts or omissions to act. Executive agrees to deliver to the Company at the termination of his service, as a condition to receipt of the next or final payment of compensation, or at any other time the Company may request in writing (whether during or after Executive’s term of service), all Records which he may then possess or have under his control. Executive further agrees that any property situated on the Company’s or its Affiliates premises and owned by the Company or its Affiliates, including disks and other storage media, filing cabinets or other work areas, is subject to inspection by Company or its Affiliates and their personnel at any time with or without notice. Nothing in this Section 2(a) shall be construed to prevent Executive from using his general knowledge and experience in future employment so long as Executive complies with this Section 2(a) and the other restrictions contained in this Amended Agreement.

 

 
2

 

 

(b) Ownership of Property. Executive acknowledges that all inventions, innovations, improvements, developments, methods, processes, programs, designs, analyses, drawings, reports and all similar or related information (whether or not patentable) that relate to the Company’s or any of its Affiliates actual or anticipated business, research and development, or existing or future products or services and that are conceived, developed, contributed to, made, or reduced to practice by Executive (either solely or jointly with others) while employed by the Company or any of its Affiliates (including any of the foregoing that constitutes any Proprietary Information or Records) (“Work Product”) belong to the Company or such Affiliate and Executive hereby assigns, and agrees to assign, all of the above Work Product to the Company or such Affiliate. Any copyrightable work prepared in whole or in part by Executive in the course of his work for any of the foregoing entities shall be deemed a work made for hire under the copyright laws, and the Company or such Affiliate shall own all rights therein. To the extent that any such copyrightable work is not a work made for hire, Executive hereby assigns and agrees to assign to Company or such Affiliate all right, title and interest, including without limitation, copyright in and to such copyrightable work. Executive shall promptly disclose such Work Product and copyrightable work to the Board and perform all actions reasonably requested by the Board (whether during or after Executive’s term of service) to establish and confirm the Company’s or its Affiliates ownership (including, without limitation, execution of assignments, consents, powers of attorney and other instruments). Notwithstanding anything contained in this Section 2(b) to the contrary, the Company’s ownership of Work Product does not apply to any invention that Executive develops entirely on his own time without using the equipment, supplies or facilities of the Company or its Affiliates or Subsidiaries or any Proprietary Information (including trade secrets), except that the Company’s ownership of Work Product does include those inventions that: (a) relate to the business of the Company or its Affiliates or Subsidiaries or to the actual or demonstrably anticipated research or development relating to the Company’s business; or (b) result from any work that Executive performs for the Company or its Affiliates or Subsidiaries.

 

(c) Third Party Information. Executive understands that the Company and its Affiliates will receive from third parties confidential or proprietary information (“Third Party Information”) subject to a duty on the Company’s and its Affiliates part to maintain the confidentiality of such information and to use it only for certain limited purposes. During the term of Executive’s service and thereafter, and without in any way limiting the provisions of Sections 2(a) and 2(b) above, Executive shall hold Third Party Information in the strictest confidence and shall not disclose to anyone (other than personnel of the Company or its Affiliates who need to know such information in connection with their work for the Company or its Affiliates) or use, except in connection with his work for the Company or its Affiliates, Third Party Information unless expressly authorized by a member of the Board in writing.

 

 
3

 

 

(d) Use of Information of Prior Employers, etc. Executive will abide by any enforceable obligations contained in any agreements that Executive has entered into with his prior employers or other parties to whom Executive has an obligation of confidentiality.

 

(e) Compelled Disclosure. If Executive is required by law or governmental regulation or by subpoena or other valid legal process to disclose any Proprietary Information or Third Party Information to any Person, Executive will immediately provide the Company with written notice of the applicable law, regulation or process so that the Company may seek a protective order or other appropriate remedy. Executive will cooperate fully with the Company and the Company’s Representatives in any attempt by the Company to obtain any such protective order or other remedy. If the Company elects not to seek, or is unsuccessful in obtaining, any such protective order or other remedy in connection with any requirement that Executive disclose Proprietary Information or Third Party Information, and if Executive furnishes the Company with a written opinion of reputable legal counsel acceptable to the Company confirming that the disclosure of such Proprietary Information or Third Party Information is legally required, then Executive may disclose such Proprietary Information or Third Party Information to the extent legally required; provided, however, that Executive will use his reasonable best efforts to ensure that such Proprietary Information is treated confidentially by each Person to whom it is disclosed.

 

3. Non-solicitation.

 

(a) Non-solicitation. As long as Executive is an executive of the Company or any Affiliate thereof, and for twelve (12) months thereafter, Executive shall not directly or indirectly through another entity: (i) induce or attempt to induce any employee of the Company or any Affiliate to leave the employ of the Company or such Affiliate, or in any way interfere with the relationship between the Company or any Affiliate and any employee thereof; (ii) hire or employ any person who was an employee of the Company or any Affiliate at any time preceding the date of such Executive’s termination.

 

(b) Acknowledgment. Executive acknowledges that in the course of his service with the Company and its Affiliates, he has and will become familiar with the trade secrets and other Proprietary Information of the Company and its Affiliates. It is specifically recognized by Executive that his services to the Company and its Subsidiaries are special, unique and of extraordinary value, that the Company has a protectable interest in prohibiting Executive as provided in this Section 3, that money damages are insufficient to protect such interests, that there is adequate consideration being provided to Executive hereunder, that such prohibitions are necessary and appropriate without regard to payments being made to Executive hereunder and that the Company would not enter this Amended Agreement with Executive without the restriction of this Section 3. Executive further acknowledges that the restrictions contained in this Section 3 do not impose an undue hardship on him and, since he has general business skills which may be used in industries other than that in which the Company and its Subsidiaries conduct their business, do not deprive Executive of his livelihood. Executive further acknowledges that the provisions of this Section 3 are separate and independent of the other sections of this Amended Agreement.

 

 
4

 

 

(c) Enforcement, etc. If, at the time of enforcement of Section 2 or 3 of this Amended Agreement, a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration, scope or geographical area reasonable under such circumstances as determined by the court shall be substituted for the stated period, scope or area. Because Executive’s services are unique, because Executive has access to Proprietary Information and for the other reasons set forth herein, the parties hereto agree that money damages would be an inadequate remedy for any breach of this Amended Agreement. Therefore, without limiting the generality of Section 7(g), in the event of a breach or threatened breach of this Amended Agreement, the Company or its successors or assigns may, in addition to other rights and remedies existing in their favor, apply to any court of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof.

 

(d) Submission to Jurisdiction. The parties hereby: (i) submit to the jurisdiction of any state or federal court sitting in Nevada in any action or proceeding arising out of or relating to Section 2 and/or 3 of this Amended Agreement; (ii) agree that all claims in respect of such action or proceeding may be heard or determined in any such court; and (iii) agree not to bring any action or proceeding arising out of or relating to Section 2 and/or 3 of this Amended Agreement in any other court. The parties hereby waive any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety or other security that might be required of any other party with respect thereto. The parties hereby agree that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by suit on the judgment or in any other manner provided by law.

 

GENERAL PROVISIONS

 

4. Definitions.

 

“Affiliate” of any Person means any other Person which directly or indirectly controls, is controlled by or is under common control with such Person.

 

“Board” means the Company’s board of directors or the board of directors or similar management body of any successor of the Company.

 

“Proprietary Information” means any and all data and information concerning the business affairs of the Company or any of its Affiliates and not generally known in the industry in which the Company or any of its Affiliates is or may become engaged, and any other information concerning any matters affecting or relating to the Company’s or its Affiliates businesses, but in any event Proprietary Information shall include, any of the Company’s and its Affiliates past, present or prospective business opportunities, including information concerning acquisition opportunities in or reasonably related to the Company’s or its Affiliates businesses or industries, customers, customer lists, clients, client lists, the prices the Company and its Affiliates obtain or have obtained from the sale of, or at which they sell or have sold, their products, unit volume of sales to past or present customers and clients, or any other information concerning the business of the Company and its Affiliates, their manner of operation, their plans, processes, figures, sales figures, projections, estimates, tax records, personnel history, accounting procedures, promotions, supply sources, contracts, know-how, trade secrets, information relating to research, development, inventions, software, techniques, technology, manufacture, purchasing, engineering, marketing, merchandising or selling, or other data without regard to whether all of the foregoing matters will be deemed confidential, material or important. Proprietary Information does not include any information which Executive has obtained from a Person other than an employee of the Company, which was disclosed to him without a breach of a duty of confidentiality.

 

 
5

 

 

“Records” means (i) any and all procedure manuals, books, records and accounts; (ii) all property of the Company and its Affiliates, including papers, note books, tapes and similar repositories containing Proprietary Information; (iii) all invoices and commission reports; (iv) customer lists partial and/or complete; (v) data layouts, magnetic tape layouts, diskette layouts, etc.; (vi) samples; (vii) promotional letters, brochures and advertising materials; (viii) displays and display materials; (ix) correspondence and old or current proposals to any former, present or prospective customer of the Company and its Affiliates; (x) information concerning revenues and profitability and any other financial conditions of the Company and its Affiliates; (xi) information concerning the Company and its Affiliates which was input by Executive or at his direction, under his supervision or with his knowledge, including on any floppy disk, diskette, cassette or similar device used in, or in connection with, any computer, recording devices or typewriter; (xii) data, account information or other matters furnished by customers of the Company and its Affiliates; and (xiii) all copies of any of the foregoing data, documents or devices whether in the form of carbon copies, photo copies, copies of floppy disks, diskettes, tapes or in any other manner whatsoever.

 

“Person” means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.

 

“Subsidiary” means any corporation of which the Company owns securities having a majority of the ordinary voting power in electing the board of directors directly or through one or more subsidiaries.

 

5. Notices. Any notice or other writing required or permitted to be given hereunder or for the purposes hereof shall be sufficiently given if delivered to the party to whom it is given or, if mailed, by prepaid registered mail, or sent by email, addressed to such party at:

 

If to Executive:

 

Alexander D. Henderson

460 White Cap Lane

Newport Coast, CA 92657

Email: alexhenderson.toga@gmail.com

 

If to the Company:

 

Toga Limited

3960 Howard Hughes Pkwy

Suite 500

Las Vegas, Nevada

Email: stevetan2016@gmail.com and wsl@boothudall.com

 

 
6

 

 

or at such other physical address as the party to whom such writing is to be given shall have last notified to the party giving the same in the manner provided in this article. Written notice hereunder, shall be delivered personally or sent to each party by (i) personal delivery; (ii) a nationally-recognized, next-day courier service; (iii) first-class registered or certified mail, postage prepaid or (iv) electronic mail. In the case of delivery by certified mail, such mailing shall be deemed to have been delivered following deposit with the U.S. Postal Service, if deposited at a United States post office five (5) calendar days following deposit with the U.S. Postal Service. In the case of overnight delivery, delivery shall be deemed to be completed upon receipt of the notice at the address provided. In the case of email delivery, delivery shall be deemed to be completed upon the email message having been sent.

 

6. Executive’s Representations and Warranties. Executive represents and warrants that he has full and authority to enter into this Amended Agreement and fully to perform his obligations hereunder, that he is not subject to any non-competition agreement, and that his past, present and anticipated future activities have not and will not infringe on the proprietary rights of others, including, but not limited to, proprietary information rights or interfere with any agreements he has with any prior employee. Executive further represents and warrants that he is not obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, which would conflict with or result in a breach of this Amended Agreement or which would in any manner interfere with the performance of his duties for the Company.

 

7. General Provisions.

 

(a) Expenses. Each party shall bear his or its own expenses in connection with the negotiation and execution of this Amended Agreement and the consummation of the transactions contemplated by this Amended Agreement.

 

(b) Severability. Whenever possible, each provision of this Amended Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Amended Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Amended Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

 

 
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(c) Complete Agreement. This Amended Agreement, those documents expressly referred to herein and other documents of even date herewith embody the complete agreement and understanding among the parties and supersede and preempt any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.

 

(d) Counterparts; Facsimile Transmission. This Amended Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement. Each party to this Amended Agreement agrees that it will be bound by its own telecopied, or electronic, signature and that it accepts the telecopied, or electronic, signature of each other party to this Amended Agreement.

 

(e) Successors and Assigns; Merger or Sale of Assets. Except as otherwise provided herein, this Amended Agreement shall bind and inure to the benefit of and be enforceable by Executive, the Company and their respective successors and assigns; provided that the rights and obligations of Executive under this Amended Agreement shall not be assignable.

 

(f) Choice of Law; Jurisdiction. All questions concerning the construction, validity and interpretation of this Amended Agreement and the exhibits hereto will be governed by and construed in accordance with the internal laws of the State of Nevada, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Nevada or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Nevada. The parties hereby: (i) submit to the jurisdiction of any state or federal court sitting in Nevada in any action or proceeding arising out of or relating to Agreement; (ii) agree that all claims in respect of such action or proceeding may be heard or determined in any such court; and (iii) agree not to bring any action or proceeding arising out of or relating to this Amended Agreement in any other court. Executive hereby waives any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety or other security that might be required of any other party with respect thereto. The parties hereby agree that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by suit on the judgment or in any other manner provided by law.

 

(g) Remedies. Each of the parties to this Amended Agreement will be entitled to enforce its rights under this Amended Agreement specifically, to recover damages and costs (including attorneys’ fees) caused by any breach of any provision of this Amended Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Amended Agreement and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent any violations of the provisions of this Amended Agreement.

 

(h) Amendment and Waiver. The provisions of this Amended Agreement may be amended or and waived only with the prior written consent of the Company and the Executive.

 

 
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(i) Business Days. If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or holiday in the state in which the Company’s chief executive office is located, the time period shall be automatically extended to the business day immediately following, such Saturday, Sunday or holiday.

 

(j) Termination. This Amended Agreement shall survive the termination of Executive’s employment with the Company and shall remain in full force and effect after such termination.

 

(k) No Waiver. A waiver by any party hereto of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which such party would otherwise have on any future occasion. No failure to exercise nor any delay in exercising on the part of any party hereto, any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided are cumulative and may be exercised singly or concurrently, and are not exclusive of any rights or remedies provided by law.

 

(l) Offset. Whenever the Company or any of its Subsidiaries is obligated to pay any sum to Executive or any Affiliate or related person thereof pursuant to this Amended Agreement, any bona fide debts that Executive or such Affiliate or related person owes to the Company or any of its Subsidiaries may be deducted from that sum before payment.

 

(m) Indemnification and Reimbursement of Payments on Behalf of Executive. The Executive shall be responsible for the payment of any federal, state, provincial, local or foreign withholding taxes, excise taxes, or employment taxes (“Taxes”) imposed with respect to Executive’s compensation or other payments from the Company or any of its Subsidiaries or Executive’s ownership interest in the Company, including, but not limited to, wages, or the receipt of stock. In the event the Executive should fail to make any such payments, the Executive indemnifies the Company for any claims, causes or action, or liabilities which may be made, advanced or incurred against the Company as a result of such non-payment, and agrees to be responsible for the Company’s attorneys’ fees and related costs in defending or protecting itself.

 

 
9

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Amended Agreement on the date first written above.

 

 

 

Executive:

 

 

 

 

 

/s/ Alexander D. Henderson

 

 

Alexander D. Henderson

 

 

 

 

 

Company: 

 

Toga Limited

       
By:

 

Name:

 
  Its:  
       

 

 
10

 

EXHIBIT 10.43

  

EXECUTIVE AGREEMENT

 

THIS EXECUTIVE AGREEMENT (this “Agreement”) is executed and effective as of August 1, 2019, by and between Toga Limited, a Nevada corporation (the “Company”), and Alexander D. Henderson, a resident of the State of California (the “Executive”).

 

Recitals

 

A. The Company and Executive desire to enter into an agreement pursuant to which Executive will serve as the Chief Financial Officer (“CFO”) of the Company on the terms and conditions set forth in this Agreement.

 

B. Certain definitions are set forth in Section 4 of this Agreement.

 

Agreement

 

The parties hereto agree as follows:

 

1. Engagement. The Company hereby engages Executive to serve as the Chief Financial Officer of the Company, and Executive agrees to serve the Company, during the Service Term (as defined in Section 1(c) hereof) in the capacities, and subject to the terms and conditions, set forth in this Agreement.

 

(a) Services. During the Service Term, Executive, as CFO, shall have all the duties and responsibilities customarily rendered by the CFO of companies of similar size and nature and as may be reasonably assigned from time to time by the Board. The CFO agrees that he will also undertake the duties and responsibilities as set forth in Schedule A attached hereto. Executive will report directly to the Company’s Group General Manager and, when the Group General Manager is not available, to the Company’s CEO. Except as otherwise provided herein, Executive will devote his best efforts and attention (except for vacation periods and periods of illness or other incapacity) to the business of the Company and its Affiliates. Notwithstanding the foregoing, and provided that such activities do not interfere with, or detract from, the fulfillment of Executive’s obligations hereunder, Executive may pursue, and perform, non- Company consulting and other projects in addition to his serving as the Company’s CFO. Unless the Company and Executive agree to the contrary, Executive’s place of business shall be at the Executive’s office in California; provided, however, that Executive will travel to such other locations of the Company and its Affiliates as may be reasonably necessary in order to discharge his duties hereunder.

 

(b) Salary, Bonus and Benefits.

 

i. Salary and Bonus. During the Service Term, the Company will pay Executive a monthly base salary (the “Monthly Base Salary”) of Fifteen Thousand Dollars ($15,000).

 

 

 

 

ii. In addition, the Company shall grant to the Executive options to purchase sixty thousand (60,000) shares Quarterly, of the Company’s common stock, par value $0.001 per share (“Common Stock”), on a cashless basis at an exercise price of $0.20 per share (the “Options”). The Options shall be subject to vesting at the rate of one-third (⅓) every thirty (30) days but shall expire on the second anniversary of this Agreement. Executive acknowledges and agrees, that the shares of Common Stock granted to Executive in accordance with this Agreement have not been registered under the United States Securities Act of 1933 (the "Securities Act") or the securities laws of any state, and that the Common Stock upon issuance will be, "restricted securities" in the United States within the meaning of Rule 144(a)(3) of the Securities Act.

 

iii. Vacation; Benefits. Executive shall be entitled to two (2) weeks of vacation per each twelve (12) months of service to the Company, with the scheduling of such vacation time to be agreed to by the Company and Executive in advance. Executive shall not be entitled to, or receive, any other benefits from the Company. Executive must serve a term of a minimum of six (6) consecutive months as the Company’s CFO before any vacation time accrues and therefore no vacation time shall accrue under the original Service Term (as such term is defined below) of this Agreement, unless the Service Term is extended by mutual consent of the Parties.

 

(c) Executive Term. Executive’s term under this Agreement shall commence on August 1, 2019, and shall terminate on July 31, 2020 (the “Service Term”). In lieu of a subsequent agreement, this Agreement and the Service Term shall become an open-ended, at- will employment agreement, unless either party provides the other party with (a) written notice of their election to terminate this Agreement fifteen (15) calendar days prior to the expiration of the original Service Term, or (b) notice of their election to terminate this Agreement thirty (30) calendar days from the date of receipt of such written notice.

 

2. Confidential Information; Proprietary Information, etc.

 

(a) Obligation to Maintain Confidentiality. Executive acknowledges that any Proprietary Information disclosed or made available to Executive or obtained, observed or known by Executive as a direct or indirect consequence of his service or performance of services for the Company or any of its Affiliates during the course of his performance of services for any of the foregoing Persons (whether or not compensated for such services), are the property of the Company and its Affiliates. Therefore, Executive agrees that he will not at any time (whether during or after Executive’s term of service) disclose or permit to be disclosed to any Person or, directly or indirectly, utilize for his own account or permit to be utilized by any Person any Proprietary Information or Records for any reason whatsoever without the Boards consent, unless and to the extent that (except as otherwise provided in the definition of Proprietary Information) the aforementioned matters become generally known to and available for use by the public other than as a direct or indirect result of Executive’s acts or omissions to act. Executive agrees to deliver to the Company at the termination of his service, as a condition to receipt of the next or final payment of compensation, or at any other time the Company may request in writing (whether during or after Executive’s term of service), all Records which he may then possess or have under his control. Executive further agrees that any property situated on the Company’s or its Affiliates premises and owned by the Company or its Affiliates, including disks and other storage media, filing cabinets or other work areas, is subject to inspection by Company or its Affiliates and their personnel at any time with or without notice. Nothing in this Section 2(a) shall be construed to prevent Executive from using his general knowledge and experience in future employment so long as Executive complies with this Section 2(a) and the other restrictions contained in this Agreement.

 

 
2

 

 

(b) Ownership of Property. Executive acknowledges that all inventions, innovations, improvements, developments, methods, processes, programs, designs, analyses, drawings, reports and all similar or related information (whether or not patentable) that relate to the Company’s or any of its Affiliates actual or anticipated business, research and development, or existing or future products or services and that are conceived, developed, contributed to, made, or reduced to practice by Executive (either solely or jointly with others) while employed by the Company or any of its Affiliates (including any of the foregoing that constitutes any Proprietary Information or Records) (“Work Product”) belong to the Company or such Affiliate and Executive hereby assigns, and agrees to assign, all of the above Work Product to the Company or such Affiliate. Any copyrightable work prepared in whole or in part by Executive in the course of his work for any of the foregoing entities shall be deemed a work made for hire under the copyright laws, and the Company or such Affiliate shall own all rights therein. To the extent that any such copyrightable work is not a work made for hire, Executive hereby assigns and agrees to assign to Company or such Affiliate all right, title and interest, including without limitation, copyright in and to such copyrightable work. Executive shall promptly disclose such Work Product and copyrightable work to the Board and perform all actions reasonably requested by the Board (whether during or after Executive’s term of service) to establish and confirm the Company’s or its Affiliates ownership (including, without limitation, execution of assignments, consents, powers of attorney and other instruments). Notwithstanding anything contained in this Section 2(b) to the contrary, the Company’s ownership of Work Product does not apply to any invention that Executive develops entirely on his own time without using the equipment, supplies or facilities of the Company or its Affiliates or Subsidiaries or any Proprietary Information (including trade secrets), except that the Company’s ownership of Work Product does include those inventions that: (a) relate to the business of the Company or its Affiliates or Subsidiaries or to the actual or demonstrably anticipated research or development relating to the Company’s business; or (b) result from any work that Executive performs for the Company or its Affiliates or Subsidiaries.

 

(c) Third Party Information. Executive understands that the Company and its Affiliates will receive from third parties confidential or proprietary information (“Third Party Information”) subject to a duty on the Company’s and its Affiliates part to maintain the confidentiality of such information and to use it only for certain limited purposes. During the term of Executive’s service and thereafter, and without in any way limiting the provisions of Sections 2(a) and 2(b) above, Executive shall hold Third Party Information in the strictest confidence and shall not disclose to anyone (other than personnel of the Company or its Affiliates who need to know such information in connection with their work for the Company or its Affiliates) or use, except in connection with his work for the Company or its Affiliates, Third Party Information unless expressly authorized by a member of the Board in writing.

 

 
3

 

 

(d) Use of Information of Prior Employers, etc. Executive will abide by any enforceable obligations contained in any agreements that Executive has entered into with his prior employers or other parties to whom Executive has an obligation of confidentiality.

 

(e) Compelled Disclosure. If Executive is required by law or governmental regulation or by subpoena or other valid legal process to disclose any Proprietary Information or Third Party Information to any Person, Executive will immediately provide the Company with written notice of the applicable law, regulation or process so that the Company may seek a protective order or other appropriate remedy. Executive will cooperate fully with the Company and the Company’s Representatives in any attempt by the Company to obtain any such protective order or other remedy. If the Company elects not to seek, or is unsuccessful in obtaining, any such protective order or other remedy in connection with any requirement that Executive disclose Proprietary Information or Third Party Information, and if Executive furnishes the Company with a written opinion of reputable legal counsel acceptable to the Company confirming that the disclosure of such Proprietary Information or Third Party Information is legally required, then Executive may disclose such Proprietary Information or Third Party Information to the extent legally required; provided, however, that Executive will use his reasonable best efforts to ensure that such Proprietary Information is treated confidentially by each Person to whom it is disclosed.

 

3. Non-solicitation.

 

(a) Non-solicitation. As long as Executive is an executive of the Company or any Affiliate thereof, and for twelve (12) months thereafter, Executive shall not directly or indirectly through another entity: (i) induce or attempt to induce any employee of the Company or any Affiliate to leave the employ of the Company or such Affiliate, or in any way interfere with the relationship between the Company or any Affiliate and any employee thereof; (ii) hire or employ any person who was an employee of the Company or any Affiliate at any time preceding the date of such Executive’s termination.

 

(b) Acknowledgment. Executive acknowledges that in the course of his service with the Company and its Affiliates, he has and will become familiar with the trade secrets and other Proprietary Information of the Company and its Affiliates. It is specifically recognized by Executive that his services to the Company and its Subsidiaries are special, unique and of extraordinary value, that the Company has a protectable interest in prohibiting Executive as provided in this Section 3, that money damages are insufficient to protect such interests, that there is adequate consideration being provided to Executive hereunder, that such prohibitions are necessary and appropriate without regard to payments being made to Executive hereunder and that the Company would not enter this Agreement with Executive without the restriction of this Section 3. Executive further acknowledges that the restrictions contained in this Section 3 do not impose an undue hardship on him and, since he has general business skills which may be used in industries other than that in which the Company and its Subsidiaries conduct their business, do not deprive Executive of his livelihood. Executive further acknowledges that the provisions of this Section 3 are separate and independent of the other sections of this Agreement.

 

 
4

 

 

(c) Enforcement, etc. If, at the time of enforcement of Section 2 or 3 of this Agreement, a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration, scope or geographical area reasonable under such circumstances as determined by the court shall be substituted for the stated period, scope or area. Because Executive’s services are unique, because Executive has access to Proprietary Information and for the other reasons set forth herein, the parties hereto agree that money damages would be an inadequate remedy for any breach of this Agreement. Therefore, without limiting the generality of Section 7(g), in the event of a breach or threatened breach of this Agreement, the Company or its successors or assigns may, in addition to other rights and remedies existing in their favor, apply to any court of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof.

 

(d) Submission to Jurisdiction. The parties hereby: (i) submit to the jurisdiction of any state or federal court sitting in Nevada in any action or proceeding arising out of or relating to Section 2 and/or 3 of this Agreement; (ii) agree that all claims in respect of such action or proceeding may be heard or determined in any such court; and (iii) agree not to bring any action or proceeding arising out of or relating to Section 2 and/or 3 of this Agreement in any other court. The parties hereby waive any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety or other security that might be required of any other party with respect thereto. The parties hereby agree that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by suit on the judgment or in any other manner provided by law.

 

GENERAL PROVISIONS

 

4. Definitions.

 

“Affiliate” of any Person means any other Person which directly or indirectly controls, is controlled by or is under common control with such Person.

 

“Board” means the Company’s board of directors or the board of directors or similar management body of any successor of the Company.

 

Proprietary Information” means any and all data and information concerning the business affairs of the Company or any of its Affiliates and not generally known in the industry in which the Company or any of its Affiliates is or may become engaged, and any other information concerning any matters affecting or relating to the Company’s or its Affiliates businesses, but in any event Proprietary Information shall include, any of the Company’s and its Affiliates past, present or prospective business opportunities, including information concerning acquisition opportunities in or reasonably related to the Company’s or its Affiliates businesses or industries, customers, customer lists, clients, client lists, the prices the Company and its Affiliates obtain or have obtained from the sale of, or at which they sell or have sold, their products, unit volume of sales to past or present customers and clients, or any other information concerning the business of the Company and its Affiliates, their manner of operation, their plans, processes, figures, sales figures, projections, estimates, tax records, personnel history, accounting procedures, promotions, supply sources, contracts, know-how, trade secrets, information relating to research, development, inventions, software, techniques, technology, manufacture, purchasing, engineering, marketing, merchandising or selling, or other data without regard to whether all of the foregoing matters will be deemed confidential, material or important. Proprietary Information does not include any information which Executive has obtained from a Person other than an employee of the Company, which was disclosed to him without a breach of a duty of confidentiality.

 

 
5

 

 

Records” means (i) any and all procedure manuals, books, records and accounts; (ii) all property of the Company and its Affiliates, including papers, note books, tapes and similar repositories containing Proprietary Information; (iii) all invoices and commission reports; (iv) customer lists partial and/or complete; (v) data layouts, magnetic tape layouts, diskette layouts, etc.; (vi) samples; (vii) promotional letters, brochures and advertising materials; (viii) displays and display materials; (ix) correspondence and old or current proposals to any former, present or prospective customer of the Company and its Affiliates; (x) information concerning revenues and profitability and any other financial conditions of the Company and its Affiliates; (xi) information concerning the Company and its Affiliates which was input by Executive or at his direction, under his supervision or with his knowledge, including on any floppy disk, diskette, cassette or similar device used in, or in connection with, any computer, recording devices or typewriter; (xii) data, account information or other matters furnished by customers of the Company and its Affiliates; and (xiii) all copies of any of the foregoing data, documents or devices whether in the form of carbon copies, photo copies, copies of floppy disks, diskettes, tapes or in any other manner whatsoever.

 

Person” means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.

 

“Subsidiary” means any corporation of which the Company owns securities having a majority of the ordinary voting power in electing the board of directors directly or through one or more subsidiaries.

 

5. Notices. Any notice or other writing required or permitted to be given hereunder or for the purposes hereof shall be sufficiently given if delivered to the party to whom it is given or, if mailed, by prepaid registered mail, or sent by email, addressed to such party at:

 

If to Executive:

 

Alexander D. Henderson

460 White Cap Lane

Newport Coast, CA 92657

Email: alexhenderson.toga@gmail.com

 

If to the Company:

 

Toga Limited

3960 Howard Hughes Pkwy

Suite 500

Las Vegas, Nevada

Email: stevetan2016@gmail.com and wsl@boothudall.com

 

 
6

 

 

or at such other physical address as the party to whom such writing is to be given shall have last notified to the party giving the same in the manner provided in this article. Written notice hereunder, shall be delivered personally or sent to each party by (i) personal delivery; (ii) a nationally-recognized, next-day courier service; (iii) first-class registered or certified mail, postage prepaid or (iv) electronic mail. In the case of delivery by certified mail, such mailing shall be deemed to have been delivered following deposit with the U.S. Postal Service, if deposited at a United States post office five (5) calendar days following deposit with the U.S. Postal Service. In the case of overnight delivery, delivery shall be deemed to be completed upon receipt of the notice at the address provided. In the case of email delivery, delivery shall be deemed to be completed upon the email message having been sent.

 

6. Executive’s Representations and Warranties. Executive represents and warrants that he has full and authority to enter into this Agreement and fully to perform his obligations hereunder, that he is not subject to any non-competition agreement, and that his past, present and anticipated future activities have not and will not infringe on the proprietary rights of others, including, but not limited to, proprietary information rights or interfere with any agreements he has with any prior employee. Executive further represents and warrants that he is not obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, which would conflict with or result in a breach of this Agreement or which would in any manner interfere with the performance of his duties for the Company.

 

7. General Provisions.

 

(a) Expenses. Each party shall bear his or its own expenses in connection with the negotiation and execution of this Agreement and the consummation of the transactions contemplated by this Agreement.

 

(b) Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

 

(c) Complete Agreement. This Agreement, those documents expressly referred to herein and other documents of even date herewith embody the complete agreement and understanding among the parties and supersede and preempt any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.

 

 
7

 

 

(d) Counterparts; Facsimile Transmission. This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement. Each party to this Agreement agrees that it will be bound by its own telecopied, or electronic, signature and that it accepts the telecopied, or electronic, signature of each other party to this Agreement.

 

(e) Successors and Assigns; Merger or Sale of Assets. Except as otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable by Executive, the Company and their respective successors and assigns; provided that the rights and obligations of Executive under this Agreement shall not be assignable.

 

(f) Choice of Law; Jurisdiction. All questions concerning the construction, validity and interpretation of this Agreement and the exhibits hereto will be governed by and construed in accordance with the internal laws of the State of Nevada, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Nevada or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Nevada. The parties hereby: (i) submit to the jurisdiction of any state or federal court sitting in Nevada in any action or proceeding arising out of or relating to Agreement; (ii) agree that all claims in respect of such action or proceeding may be heard or determined in any such court; and (iii) agree not to bring any action or proceeding arising out of or relating to this Agreement in any other court. Executive hereby waives any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety or other security that might be required of any other party with respect thereto. The parties hereby agree that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by suit on the judgment or in any other manner provided by law.

 

(g) Remedies. Each of the parties to this Agreement will be entitled to enforce its rights under this Agreement specifically, to recover damages and costs (including attorneys’ fees) caused by any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent any violations of the provisions of this Agreement.

 

(h) Amendment and Waiver. The provisions of this Agreement may be amended or and waived only with the prior written consent of the Company and the Executive.

 

(i) Business Days. If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or holiday in the state in which the Company’s chief executive office is located, the time period shall be automatically extended to the business day immediately following, such Saturday, Sunday or holiday.

 

(j) Termination. This Agreement shall survive the termination of Executive’s employment with the Company and shall remain in full force and effect after such termination.

 

(k) No Waiver. A waiver by any party hereto of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which such party would otherwise have on any future occasion. No failure to exercise nor any delay in exercising on the part of any party hereto, any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided are cumulative and may be exercised singly or concurrently, and are not exclusive of any rights or remedies provided by law.

 

(l) Offset. Whenever the Company or any of its Subsidiaries is obligated to pay any sum to Executive or any Affiliate or related person thereof pursuant to this Agreement, any bona fide debts that Executive or such Affiliate or related person owes to the Company or any of its Subsidiaries may be deducted from that sum before payment.

 

(m) Indemnification and Reimbursement of Payments on Behalf of Executive. The Executive shall be responsible for the payment of any federal, state, provincial, local or foreign withholding taxes, excise taxes, or employment taxes (“Taxes”) imposed with respect to Executive’s compensation or other payments from the Company or any of its Subsidiaries or Executive’s ownership interest in the Company, including, but not limited to, wages, or the receipt of stock. In the event the Executive should fail to make any such payments, the Executive indemnifies the Company for any claims, causes or action, or liabilities which may be made, advanced or incurred against the Company as a result of such non-payment, and agrees to be responsible for the Company’s attorneys’ fees and related costs in defending or protecting itself.

 

 
8

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first written above.

 

 

 

Executive:

 

 

 

 

 

/s/ Alexander D. Henderson

 

 

Alexander D. Henderson

 

 

 

 

 

Company:

 

Toga Limited

       
By:

 

Name:

 
  Its:  
       

 

 
9

 

EXHIBIT 10.44

 

 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

 

 

 
 

 

EXHIBIT 21.1

 

LIST OF SUBSIDIARIES

January 31, 2021

    

Name of Active Subsidiary*

Jurisdiction of Organization

 

 

 

TOGL Technology Sdn. Bhd. (100%)

 

Malaysia

PT TOGL Technology Indonesia (67%)

Indonesia

Toga Vietnam Company Limited (100%)

Vietnam

WGS Discovery Tours and Travel (M) Sdn. Bhd. (100%)

Malaysia

PT Toga International Indonesia (95%)

 

Indonesia

Eostre Bhd. (20% equity, 100% voting control)

 

Malaysia

 

* Percentages in parentheses indicate Toga Limited’s ownership.

 

EXHIBIT 31.1

 

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR RULE 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

 

I, Toh Kok Soon, Chief Executive Officer of TOGA LIMITED, certify that:

 

1.

I have reviewed this Annual Report on Form 10-K of Toga Limited;

 

 

2.

Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

4.

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

 

a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 

 

 

b)

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

 

 

 

c)

evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

 

 

 

d)

disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

 

a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process summarize and report financial information; and

 

 

 

 

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

       
Date: February 5, 2021 By: /s/ Toh Kok Soon

 

Name:

Toh Kok Soon  
  Title: Chief Executive Officer  

 

EXHIBIT 31.2

 

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR RULE 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

 

I, Alexander D. Henderson, Chief Financial Officer of TOGA LIMITED certify that:

 

1.

I have reviewed this Annual Report on Form 10-K of Toga Limited;

 

 

2.

Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

4.

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

 

a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 

 

 

b)

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

 

 

 

c)

evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

 

 

 

d)

disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

 

a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process summarize and report financial information; and

 

 

 

 

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: February 5, 2021 By: /s/ Alexander D. Henderson

 

Name:

Alexander D. Henderson  
  Title: Chief Financial Officer (Principal Financial Officer)  

 

EXHIBIT 32.1

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Annual Report on Form 10-K for the period ended July 31, 2019 of TOGA LIMITED (the “Company”), as filed with the Securities and Exchange Commission on the date hereof (the “Annual Report”), I, Toh Kok Soon, Chief Executive Officer of the Company certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

1.

The Annual Report fully complies with the requirements of Section 13(a) or15(d) of the Securities and Exchange Act of 1934, as amended; and

 

 

2.

The information contained in this Annual Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

 

       
Date: February 5, 2021 By: /s/ Toh Kok Soon 

 

Name:

Toh Kok Soon  
  Title: Chief Executive Officer  

 

EXHIBIT 32.2

 

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Annual Report on Form 10-K for the period ended July 31, 2019 of TOGA LIMITED (the “Company”), as filed with the Securities and Exchange Commission on the date hereof (the “Annual Report”), I, Alexander D. Henderson, Chief Financial Officer of the Company certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

 

1.

The Annual Report fully complies with the requirements of Section 13(a) or15(d) of the Securities and Exchange Act of 1934, as amended; and

 

 

2.

The information contained in this Annual Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

 

       
Date: February 5, 2021 By: /s/ Alexander D. Henderson

 

Name:

Alexander D. Henderson  
  Title: Chief Financial Officer (Principal Financial Officer)