0001485029 --12-31 false 2019 FY 0001485029 2019-01-01 2019-12-31 0001485029 2019-12-31 0001485029 2019-06-30 0001485029 2020-04-17 0001485029 2018-12-31 0001485029 2018-01-01 2018-12-31 0001485029 us-gaap:RetainedEarningsMember 2019-01-01 2019-12-31 0001485029 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-01-01 2019-12-31 0001485029 2017-12-31 0001485029 us-gaap:CommonStockMember 2017-12-31 0001485029 us-gaap:AdditionalPaidInCapitalMember 2017-12-31 0001485029 us-gaap:RetainedEarningsMember 2017-12-31 0001485029 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2017-12-31 0001485029 us-gaap:RetainedEarningsMember 2018-01-01 2018-12-31 0001485029 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-01-01 2018-12-31 0001485029 us-gaap:CommonStockMember 2018-12-31 0001485029 us-gaap:AdditionalPaidInCapitalMember 2018-12-31 0001485029 us-gaap:RetainedEarningsMember 2018-12-31 0001485029 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-12-31 0001485029 us-gaap:CommonStockMember 2019-12-31 0001485029 us-gaap:AdditionalPaidInCapitalMember 2019-12-31 0001485029 us-gaap:RetainedEarningsMember 2019-12-31 0001485029 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-12-31 0001485029 fil:NewAsiaHoldingsLimitedMember 2014-12-31 0001485029 fil:PremierBusinessCentersMember 2019-01-01 2019-12-31 0001485029 srt:MinimumMemberfil:PremierBusinessCentersMember 2019-01-01 2019-12-31 0001485029 srt:MaximumMemberfil:PremierBusinessCentersMember 2019-01-01 2019-12-31 0001485029 fil:N2016Member 2019-01-01 2019-12-31 0001485029 fil:N2017Member 2019-01-01 2019-12-31 0001485029 fil:N2018Member 2019-01-01 2019-12-31 0001485029 fil:N2019Member 2019-01-01 2019-12-31 0001485029 fil:StockholderMember 2019-01-01 2019-12-31 0001485029 fil:NewAsiaHoldingsLimitedMember 2019-12-31 0001485029 srt:VicePresidentMember 2019-01-01 2019-12-31 0001485029 srt:VicePresidentMember 2018-01-01 2018-12-31 0001485029 srt:VicePresidentMember 2019-12-31 0001485029 srt:VicePresidentMember 2018-12-31 0001485029 fil:NewAsiaMomentumLimitedMember 2019-01-01 2019-12-31 0001485029 fil:NewAsiaMomentumLimitedMember 2018-01-01 2018-12-31 0001485029 fil:NewAsiaMomentumLimitedMember 2019-12-31 0001485029 fil:NewAsiaMomentumLimitedMember 2018-12-31 0001485029 fil:PremierBusinessCentersMember 2017-08-01 2018-07-24 xbrli:pure iso4217:USD xbrli:shares iso4217:USD xbrli:shares

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K

 

(Mark One)

 

 

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

 

For the fiscal year ended: December 31, 2019

 

 

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

For the transition period from ____________ to _____________

 

Commission File No. 000-55410

 

New Asia Holdings, Inc.

(Exact name of registrant as specified in its charter)

 

Nevada

 

45-0460095

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

11 Beach Road #06-01

Singapore 189675

(Address of principal executive offices)

 

+65 6820-8885

(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: Common Stock, $0.001 par value

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [X]

 

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 [X]

 

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 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 [X] 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 (Sec. 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 [X] No [ ]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "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 [X]

 

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 registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No [X]

 

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter. As of June 28, 2019, the aggregate market value was $67,453.

 

The number of shares outstanding of each of the issuer's classes of common stock, as of April 17, 2020, is as follows:

 

Classes of Common Stock

 

Shares Outstanding

Common Stock, $0.001 par value

 

72,288,667

 

 

 

 

DOCUMENTS INCORPORATED BY REFERENCE

None.


New Asia Holdings, Inc.

Annual Report on Form 10-K

For the Fiscal Year Ended December 31, 2019

 

TABLE OF CONTENTS

 

PART I

Item 1.

Business

 

Item 1A.

Risk Factors

 

Item 1B.

Unresolved Staff Comments

 

Item 2.

Properties

 

Item 3.

Legal Proceedings

 

Item 4.

Mine Safety Disclosures

 

PART II

Item 5.

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

 

Item 6.

Selected Financial Data

 

Item 7.

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

 

Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

 

Item 8.

Financial Statements and Supplementary Data

 

Item 9.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 

Item 9A.

Controls and Procedures

 

Item 9B.

Other Information

 

PART III

Item 10.

Directors, Executive Officers and Corporate Governance

 

Item 11.

Executive Compensation

 

Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 

Item 13.

Certain Relationships and Related Transactions, and Director Independence

 

Item 14.

Principal Accounting Fees and Services

 

PART IV

Item 15.

Exhibits, Financial Statement Schedules

 

Item 16.

Form 10-K Summary

 

 


1


Special Note Regarding Forward-Looking Statements

 

Certain statements contained in this Annual Report on Form 10-K, including, without limitation, statements containing the words "believes", "anticipates", "expects" and words of similar import, constitute forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the registrant, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: international, national and local general economic and market conditions: demographic changes; the ability of the registrant to sustain, manage or forecast its growth; the ability of the registrant to successfully make and integrate acquisitions; raw material costs and availability; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other factors referenced in this and previous filings.

 

Given these uncertainties, readers of this Annual Report on Form 10-K and investors are cautioned not to place undue reliance on such forward-looking statements. The registrant disclaims any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.


2


PART I

 

ITEM 1.

BUSINESS.

 

Overview

 

Since December 24, 2014, New Asia Holdings, Inc., a Nevada corporation (the "Company" or "NAHD"), has been developing and deploying its proprietary, neural trading models for the financial community. We offer trading software solutions to clients on the basis of a software-as-a-service (“SaaS”) licensing and delivery models with licensed users availing themselves of service-based contractual arrangements.

 

The Company's products capitalize the large volume of the 24 hour Forex markets to achieve capital appreciation over a medium- to long-term basis, combined with the usage of a good wealth vehicle designed to control risk, profit from both bull or bear markets, and maximize liquidity and economic resilience.

 

Our proprietary trading models were developed by a team of professional engineers in communications, electronic circuitry design and financial engineering. This diverse team is the key factor in our successful development of non-traditional and innovative trading models. Our systems were designed to take intelligent positions as the market moves/changes and, upon development, our systems were to bring a rigorously tested track-record.

 

The NAHD systems were designed to adapt themselves and to take intelligent positions as the market moves/changes. The models were subjected to rigorous testing akin to the volatile trading environment of major financial events/crises that have happened in recent history. These models were also programmed to have the ability to learn and adapt new manners of trading, effectively translating the human behavioral of trading into a predictive science. The NAHD quantitative strategies and proprietary algorithmic trading system were developed to generate risk adjustable returns for its licensees and their clients.

 

Since 2016, the Company's focus has been to license its algorithm to licensees, regulated funds and banks to capitalize on the large volume of the 24-hour Forex markets to achieve capital appreciation over a medium- to long- term basis, combined with the usage of a good wealth vehicle designed to control risk, profit from both bull or bear markets, and maximize liquidity and economic resilience.

 

On August 25, 2015, the Company entered into a Sale and Purchase Agreement (the “Purchase Agreement”) with Anthony Ng Zi Qin, pursuant to which the Company acquired Magdallen Quant Pte Ltd (“MQL”). The MQL acquisition was accomplished through a share exchange with Anthony Ng Zi Qin of 7,422,000 restricted shares of common stock of the Company ("Consideration Shares"), with a value of $0.41 per share, and an aggregate fair value of $3,043,020, in exchange for the entire issued and outstanding capital of MQL held by Mr. Anthony Ng Zi Qin, consisting of 8,000,100 shares of stock issued at par value of SGD 1.00 per share, or $0.714 on the acquisition date. On August 19, 2016, the Company and Anthony Ng Zi Qin entered into an Addendum (the “First MQL Addendum”) to the Purchase Agreement to extend the August 25, 2016 anniversary date for the adjustment of issued shares for an additional period of 12 months. On November 10, 2017, the Company and Anthony Ng Zi Qin signed an Addendum (the “Second MQL Addendum”) to the Purchase Agreement, as amended, pursuant to which the Company agreed to issue an aggregate of 3,339,900 shares of common stock, in satisfaction of the shortfall in the value of the shares issued. These shares were issued on December 12, 2017 in full satisfaction of the aforementioned contingent liability. The Purchase Agreement, as amended, is referred to herein as the “MQL Acquisition Agreement.”

 

The algorithms were placed into commercial operation in November 2015 upon the execution of a Software License Agreement (the “MQL License Agreement”) between and New Asia Momentum Limited (“NAML”), a company owned and controlled by NAHD’s Chairman and CEO, Dr. Lin Kok Peng. Under the terms of the MQL License Agreement, MQL agreed to license its proprietary trainable, trading algorithms to NAML in exchange for payment of a license fee and certain other fixed and time and materials fees. Pursuant to the terms of the MQL License Agreement, MQL licensed its proprietary trainable, trading algorithms. NAML, in turn, offered these proprietary, trainable, algorithm trading software solutions to broker-dealers, banks, funds and other clients on the basis of a SaaS licensing and delivery model, with sub-licensed users availing themselves of service-based contractual arrangements. NAML was required to pay MQL royalty fees equal to 20% of the trading profits achieved by the SaaS contract agreements that NAML executed with its clients. The targeted geographic market was Asia, with an initial emphasis on Singapore, Hong Kong, Indonesia, and Australia. From 2015 to 2017, NAML grew its retail assets under management (“AUM”) from zero to approximately $2.5 million.

 

In conjunction with the expansion into the regulated fund and bank model, NAML decided to ask its clients to redeem the AUM and as of September 30, 2017, trading on the AUM was terminated. Specifically, and to support NAML’s decision to expand into the regulated fund and bank model, the Series Z (Multi-Asset Currency and Gold) were redeveloped into the following products:


3


7.42.31   

7.43.315   

7.43.325   

 

The three primary competitive advantages associated with the above trading algorithms are rates of return, efficiency and safety.

 

Fund

MQ X1

MQ Y1

MQ Z1 @ 2%

Number of Trades

272

112

376

Sharpe Ratio

3.3

2.9

2.44

Profit Factor

2.5

3.46

1.99

Return/DD

26.09

16.69

16.71

Winning (%)

59.93%

64.29%

75%

Drawdown (%)

29.34%

62.99%

2.57%

 

The backend programming associated with the MQ X1 and the MQ Y1 are driven by mean reversion whereas the backend of the MQ Z1 is driven by momentum and trend following. All the algorithms incorporate currency flows and are designed to reduce positions when trends become adverse.

 

In January 2017, NAML, the Company’s exclusive licensee, entered into an agreement with Ferrell Asset Management Pte Ltd (“FAMPL”), a wholly owned subsidiary of Ferrell Financial Group. Ferrell Financial Group, which started as an exempt fund manager in 2004, holds a Capital Markets Services License issued by the Monetary Authority of Singapore (the “MAS”) for the provision of fund management services to individuals who are accredited investors (“Accredited Investors”) as defined in Section 4A(1)(a)(i) of the Securities and Futures Act (Chapter 289) of Singapore. Ferrell Financial Group is an Asia-focused financial services group dedicated to serving the investment and wealth management needs of family offices and private individuals globally. As an independent, privately held group, Ferrell Financial Group forms strategic partnerships with financial institutions and other relevant organizations to provide customized portfolio solutions for its clients.

 

The Company initiated its focus on the regulated bank and fund model in 2017 with the launch of the Feuris Fund A with AUM of approximately $6.67 million. Because the risk profiles required by these regulated funds and banks reflect a lower level of risk, there was a significantly reduced frequency of trading activities. As of September 30, 2019, due to market conditions that impacted trading frequencies and volumes, NAML liquidated the Feuris Fund A and returned the AUM to the investors.  

 

The MQL License Agreement remains in place. While the Company continues to improve its algorithm products, there are no guarantees that such product improvements will translate to improved financial performance. The Company, in its efforts to expand its business, is currently involved in the development of new business opportunities, including the following:

 

Point of Sales (POS) and mobile Point of Sales (mPOS) solutions and technologies. The Company expects to develop its own mobile readers which would allow small- and medium-sized businesses to accept payments anytime and anywhere by swiping a debit or credit card. The Company aims to be a strong market leader in mPOS solutions.  

 

A global digital payment system that would allow users to gain access to the existing global merchant base in multiple countries and regions and earn attractive rewards and cashback benefits. We expect that access to the existing global merchant base would be established through proven payment merchant networks, such as UnionPay, and convertible to both mainstream currencies and other digital assets to ensure a steady stream of liquidity. We anticipate that users would be able to convert cryptocurrencies for spending at merchant outlets worldwide. 

 

The Company generated immaterial revenues during the year ended December 31, 2018 and no revenues were generated during the year ended December 31, 2019.

 

Algorithm Trading Generally

 

In accordance with a 2016 study published in Advances in Intelligent Systems and Computing in October 2018 ("Optimizing Automated Trading Systems"), 80% of trading in the FOREX market was performed by trading algorithms rather than humans . Algorithmic trading relies on sophisticated computer programs and models to make automated decisions regarding the market, without human input. Such models are especially popular in strategies such as managed futures, where trend following is prevalent.


4


 

There are three general types of algorithmic trading:

 

Systematic trading: Systematic trading refers to any trading strategy that is a "rule-based" systematic/repetitive approach to execution trading behaviors. This is often achieved through utilization of an expert system that replicates previously captured actions of real traders. 

 

High-frequency trading (“HFT”): HFT is a type of algorithmic trading in which execution of computerized trading strategies is characterized by extremely short position-holding periods in excess of a few seconds or milliseconds. 

 

Ultra-high-frequency trading: Sometimes also known as low-latency trading, ultra-high-frequency trading refers to HFT execution of trades in sub-millisecond times through co-location of servers and stripped down strategies, direct market access, or individual data feeds offered by exchanges and others to minimize network and other types of latencies. 

 

The programming associated with the MQ X1 and MQ Y1 algorithms are driven by mean reversion, whereas the programming of the MQ Z1 algorithm is driven by momentum and trend following. All of the algorithms incorporate currency flows and are designed to reduce positions when trends become adverse. These algorithms are very easy for us to deploy and operate via the SaaS model. The combination of this business model and the composition of the algorithms render the trading of currencies and gold nearly effortless: no traders are needed, thereby eliminating compensation-related expenses. In addition to the returns and safety characteristics associated with the subject algorithms, these algorithms are favorable to account holders in that they neither lend themselves to HFT nor to high commissions.

 

The following are common trading strategies used in algorithmic trading:

 

Trend Following Strategies: The most common algorithmic trading strategies follow trends in moving averages, channel breakouts, price level movements and related technical indicators. These are the easiest and simplest strategies to implement through algorithmic trading because these strategies do not involve making any predictions or price forecasts. Trades are initiated based on the occurrence of desirable trends, which are easy and straightforward to implement through algorithms without getting into the complexity of predictive analysis.

 

Arbitrage Opportunities: This strategy involves buying a dual-listed stock at a lower price in one market and simultaneously selling it at a higher price in another market, offering the price differential as risk-free profit or arbitrage. The same operation can be replicated for stocks versus futures instruments, as price differentials do exist from time to time. Implementing an algorithm to identify such price differentials and placing the orders allows profitable opportunities in efficient manner.

 

Index Fund Rebalancing: Index funds have defined periods of rebalancing to bring their holdings to par with their respective benchmark indices. This creates profitable opportunities for algorithmic traders, who capitalize on expected trades that offer 20-80 basis points profits, depending upon the number of stocks in the index fund, just prior to index fund rebalancing. Such trades are initiated via algorithmic trading systems for timely execution and best prices.

 

Mathematical Model Based Strategies: A lot of proven mathematical models, which allow trading on a combination of options and their respective underlying securities, where trades are placed to offset positive and negative deltas so that the portfolio delta is maintained at zero.

 

Trading Range (Mean Reversion): Mean reversion strategy is based on the idea that the high and low prices of an asset are a temporary phenomenon that revert to their mean value periodically. Identifying and defining a price range and implementing an algorithm based on that allows trades to be placed automatically when the price of an asset breaks in and out of its defined range.

 

Volume Weighted Average Price (“VWAP”): VWAP strategy breaks up a large order and releases dynamically determined smaller chunks of the order to the market using stock-specific historical volume profiles. The aim is to execute the order close to the VWAP, thereby benefiting on average price.

 

Time Weighted Average Price (“TWAP”): TWAP strategy breaks up a large order and releases dynamically determined smaller chunks of the order to the market using evenly divided time slots between a start and end time. The aim is to execute the order close to the average price between the start and end times, thereby minimizing market impact.

 


5


Percentage of Volume: Until the trade order is fully filled, this algorithm continues sending partial orders, according to the defined participation ratio and according to the volume traded in the markets. The related "steps strategy" sends orders at a user-defined percentage of market volumes and increases or decreases this participation rate when the stock price reaches user-defined levels.

 

Implementation Shortfall: The implementation shortfall strategy aims at minimizing the execution cost of an order by trading off the real-time market, thereby saving on the cost of the order and benefiting from the opportunity cost of delayed execution. The strategy will increase the targeted participation rate when the stock price moves favorably and decrease it when the stock price moves adversely.

 

Beyond the Usual Trading Algorithms: There are a few special classes of algorithms that attempt to identify "happenings" on the other side. These "sniffing algorithms," used, for example, by a sell side market maker have a built-in intelligence to identify the existence of any algorithms on the buy side of a large order. Such detection through algorithms will help the market maker identify large order opportunities and enable the market maker to benefit by filling the orders at a higher price. This is sometimes identified as high-tech front running.

 

NAHD's Design Philosophy

 

Price is simply a reflection and emotional perception of value. Mechanical systems have no emotions when it comes to the interpretation of prices. Nothing is actually too high or too low; it’s all technically relative.

 

NAHD uses a multitude of modern tools and technology to making trading simpler, adaptive and intelligent:

 

Some of the tools we apply include:

 

·Principle Component Analysis (“PCA”) 

·Neural Networks 

·Removing Linear Trends from Data 

·Detecting Anomaly Activities 

·Market Behavioral Pattern Neural Analysis 

·Co-relational Modeling 

·Multi-Time Frame Signal Analysis 

 

PCA is a tool in exploratory data analysis to discover the important variables (or a combination of them) that explain the cause of variance in the data and thus enhances the efficiency when there is a large volume of data to be analyzed.

 

Factor analysis is a statistical method used to describe variability among observed, correlated variables in terms of a potentially lower number of unobserved variables called factors. Factor analysis searches for such joint variations in response to unobserved latent variables. The observed variables are modeled as linear combinations of the potential factors, plus "error" terms. The information gained about the interdependencies between observed variables can be used later to reduce the set of variables in a dataset and thus helps us to reduce complex multi-dimensional modeling data into 2-dimensional outcome for easier analysis.

 

Factor analysis is related to PCA, but the two are not identical. Latent variable models, including factor analysis, use regression modeling techniques to test hypotheses producing error terms, while PCA is a descriptive statistical technique.

 

The artificial neural networks are one of the areas in artificial intelligence research that is based on the attempts to simulate the human nervous system in its ability to learn and adapt. It strives to allow us to build a rough simulation of the human brain in operation. When it comes to trading, it is generally a matter of whether to buy, sell or hold and position sizing. In other words, algorithm trading strategies (ATS) significantly simplify decision making as opposed to what would otherwise be possible if human beings were doing the trading.

 

The Company has strived to develop systems which are adaptive and where no two trades are the same. This is because the market is changing all the time (every hour, minute and second). Thus, it is imperative to achieve an acceptable level of machine learning adaptability within the confines of the boundaries of trading. This enables our clients to stay in the highly challenging game of trading under most, if not all, market conditions. Our systems employ the following strategies:

 

Momentum: A trend-following trading strategy that aims to capitalize on the continuance of existing trends in the market. The algorithm assumes large increases in the price of a security will be followed by additional gains and vice versa for declining values. 


6


Mean Reversion: A trading strategy assuming prices and returns eventually move back toward the mean or average. A popular strategy is mean reversion (pairs trading) where two historically correlated securities that have diverged are assumed to converge in the future. Statistical Arbitrage ("stat arb") is an equity trading strategy that employs time series methods to identify relative mispricing between stocks. It bets on the convergence of the prices of similar financial instruments whose prices have diverged. 

 

The Software as a Service (SaaS) Public Market Performance

 

SaaS is a software licensing and delivery model in which software is licensed on a subscription basis and is centrally hosted. It is sometimes referred to as "on-demand software". SaaS is typically accessed by users using a thin client via a web browser. SaaS has become a common delivery model for many business applications, including financial services, office and messaging software, payroll processing software, DBMS software, management software, CAD software, development software, gamification, virtualization, accounting, collaboration, customer relationship management (CRM), management information systems (MIS), enterprise resource planning (ERP), invoicing, human resource management (HRM), talent acquisition, content management (CM), antivirus software, and service desk management.  SaaS has been incorporated into the strategy of all leading enterprise software companies.

 

According to Gartner Group estimates, SaaS remains the largest segment of the cloud market, with revenue expected to grow 17.8% to reach $116.0 billion in 2020.

 

Table 1. Worldwide SaaS Revenue Forecast (Billions of U.S. Dollars)

 

 

2019

2020

2021

2022

SaaS

99.5

116.0

133.0

151.1

 

The acceleration in SaaS adoption can be explained by providers delivering nearly all application functional extensions and add-ons as a service. This appeals to users because SaaS solutions are engineered to be more purpose-built and are delivering better business outcomes than traditional software.

Public SaaS companies have historically enjoyed trading multiples at least twice that of their on-premise peers. According to the above publicly available SEG report, a premium market valuation multiple can be largely justified by comparing the relative lifetime value of a SaaS customer versus an on-premise licensee. A SaaS company with a mission critical hosted app and strong customer retention will garner significantly greater cash over time from its average customer than will its on-premise counterpart. In the meantime, according to the SEG Software Industry report, investors are placing their bets on the next wave of SaaS category leaders that are positioned to displace incumbent on-premise providers across multiple product categories.


7


 

NAHD and Business Structure

PICTURE  

 

Corporate History

 

We were incorporated on March 1, 2001 under the laws of the state of Nevada under the name Effective Sports Nutrition Corporation. On April 11, 2005, we changed our name from Effective Sports Nutrition Corporation to Midwest E.S.W.T. Corp.

 

On July 18, 2005, we entered into a share exchange agreement (the "Share Exchange Agreement") with Direct Success, Inc. As a result of the share exchange contemplated by the Share Exchange Agreement (the “Share Exchange”), we issued shares of common stock to the shareholders of Direct Success, Inc. in exchange for all of the issued and outstanding common stock in Direct Success, Inc. On December 14, 2005, we changed our name from Midwest E.S.W.T. Corp. to DM Products, Inc.  As a result of the Share Exchange, Direct Success, Inc. became our wholly owned subsidiary. At the time of the Share Exchange, Direct Success, Inc. had an accumulated loss of $6,195,881. The Company dissolved Direct Success, Inc. on April 23, 2013 and April 5, 2013.

 

On December 24, 2014, the board of directors authorized the Company to enter into a Stock Purchase Agreement (the "Agreement") with four accredited investors, pursuant to which the Company issued an aggregate of 58,904,964 shares of common stock, or approximately 97% of the issued and outstanding common stock of the Company, at an aggregate purchase price of $350,000 resulting in a change of control. The stock was issued as follows: 54,957,724 shares of common stock to New Asia Holdings Limited for $326,546, 1,821,803 shares of common stock to Wong Kai Fatt for $10,825, 1,518,169 shares of common stock to Earth Heat Ltd. for $9,021, and 607,268 shares of common stock to Kline Law Group PC for $3,608. Since we effected a change of control on December 24, 2014, we have focused on the development and licensing of advanced, proprietary, neural trading models for the financial community.

On January 23, 2015, we changed the Company’s name from DM Products, Inc. to New Asia Holdings, Inc.

On August 19, 2015, the Board of Directors of the Company approved a resolution acknowledging that New Asia Holdings Ltd, the principal controlling shareholder of the Company, (i) had been advancing funds in the amount of $220,000 to the Company since December 24, 2014 to pay for operating expenses of the Company and (ii) would be required to advance an additional $80,000 to the Company to fund further operating expenses of the Company. The Board further resolved that these advances would constitute an interest-free loan to the Company to be repaid by the close of business on October 31, 2015. However, if the Company was unable to repay these advances by such date, New Asia Holdings Ltd, at its sole discretion, would have the option to extend the repayment deadline or convert all or a portion of the above advances into common stock of the Company at a conversion price of $0.02 per share. Through 2019, the Company had received a total of $836,452 in the form of an interest-free loan from its principal


8


shareholder. As of December 31, 2019, New Asia Holdings Ltd, had not yet acted to exercise its option to convert the Advances to shares of common stock, thus the Advances remained as an interest-free loan to the Company.

 

On August 28, 2015, the Company completed the acquisition of MQL. In November 2015, MQL entered into the MQL License Agreement with NAML, a Company owned and controlled by NAHD's Chairman and CEO, Dr. Lin Kok Peng.

 

Corporate Website

 

The Company’s corporate website is www. newasiainc.com; however, it is currently under construction.

 

Employees

 

The Company currently has no employees. Management of the Company expects to use consultants, attorneys and accountants as necessary, and expects to hire full-time staff as the SaaS and Forex trading business expands.

 

Smaller Reporting Company Status

 

We qualify as a "smaller reporting company" under Rule 12b-2 of the Exchange Act, which is defined as a company with a public equity float of less than $75 million. To the extent that we remain a smaller reporting company at such time as are no longer an emerging growth company, we will still have reduced disclosure requirements for our public filings, some of which are similar to those of an emerging growth company, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements.


9


 

ITEM 1A.

RISK FACTORS.

 

Certain factors may have a material adverse effect on our business, financial condition and results of operations. Investors should carefully consider the risks and uncertainties described below, together with all of the other information contained in this Annual Report on Form 10-K and other reports we file with the Securities and Exchange Commission (the “SEC”) pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including our historical and financial statements and related notes. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business. If any of the following risks or uncertainties actually occurs, our business, financial condition, results of operations, liquidity, cash flows and prospects could be materially and adversely affected. As a result, the price of our common stock could decline significantly, and an investor could lose all or part of its investment in our common stock. The risks discussed below include forward-looking statements, and our actual results may differ substantially from those discussed in these forward-looking statements.

 

Risk Related to Our Business and Our Industry

 

Public health epidemics or outbreaks, such as COVID-19, could materially and adversely impact our business.

 

In December 2019, a novel strain of coronavirus (COVID-19) emerged in Wuhan, Hubei Province, China. While initially the outbreak was largely concentrated in China and caused significant disruptions to its economy, it has now spread to several other countries and infections have been reported globally.

 

Because COVID-19 infections have been reported worldwide, certain national, state and local governmental authorities have issued stay-at-home orders, proclamations and/or directives aimed at minimizing the spread of COVID-19. Additional, more restrictive proclamations and/or directives may be issued in the future. As a result, certain Company internal operations communications and accounting operations have been disrupted by these “stay at home” orders, which have affected the timing of certain new business development activities (the Company had previously liquidated the Feuris Fund A AUM during the third quarter of 2019).

 

The ultimate impact of the COVID-19 pandemic on the Company’s operations is unknown and will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the COVID-19 outbreak, new information which may emerge concerning the severity of the COVID-19 pandemic, and any additional preventative and protective actions that governments, or the Company, may direct, which may result in an extended period of continued business disruption and reduced operations. Any resulting financial impact cannot be reasonably estimated at this time but could be anticipated to have a material adverse impact on our business, financial condition and results of operations.

 

The measures taken to date will impact the Company’s business for the fiscal first and second quarters and potentially beyond. Management expects that all of its business segments, across all of its geographies, will be impacted to some degree, but the significance of the impact of the COVID-19 outbreak on the Company’s business and the duration for which it may have an impact cannot be determined at this time.

 

General Risks

 

The use of the Company's software ("Software") will be subjected to different degrees of economic, political, foreign exchange, interest rates, liquidity, repatriation, volatility default and regulatory risks, depending on each relevant model. NAHD's proprietary trainable trading algorithm software signals generated are based on factual inputs and information from the market and are not deemed as financial advices. Past results are not necessarily indicative of future results. Notwithstanding the use of our Proprietary Trainable Trading Algorithms ("Series of Algorithms"), the value of investments may fall as well as rise and a holder may not recoup its capital. There can be no assurance that the performance of a Series of Algorithms will be profitable. On establishment, a Series of Algorithms will normally have no operating history upon which stockholders may base an evaluation of performance.

 

Change in Strategies

 

The strategies, approaches and techniques discussed herein may evolve over time due to, amongst other things, market developments and trends, the emergence of new or enhanced products, changing industry practice and/or technological innovation. As a result, these strategies, approaches and techniques may not reflect the strategies, approaches and techniques actually employed by NAHD or its Software. Nevertheless, the strategies employed in the Software will be consistent with the NAHD's objective.

 


10


 

Fundamental Strategies

 

Fundamental analysis, which posits that markets are imperfect and that mispricings can be identified between prevailing market prices and those indicated by underlying fundamental data, is subject to the risk of inaccurate or incomplete market information, as well as the difficulty of predicting prices based on such information. Furthermore, even if an analyst is able to successfully identify mispricings on the basis of fundamental factors, there is the additional uncertainty of predicting the duration or degree of such mispricings and, accordingly, when or whether to enter so as to profit from them. Positions made based on fundamental analysis are subject to significant losses when market sentiment leads to the market price of the Software being materially discounted from the level indicated by Software fundamental analysis or technical factors, such as price momentum or option expirations, dominate the market.

 

Model and Data Risk

 

NAHD relies heavily on quantitative models ("Models") and information and data ("Data"). Models and Data are used to construct sets of transactions, to evaluate potential opportunities, to provide risk management insights and to assist in hedging the Software's trades. Models and Data are known to have errors, omissions, imperfections and malfunctions (collectively, "System Events"). System Events in third-party Models are generally entirely outside of the control of NAHD.

 

NAHD seeks to reduce the incidence and impact of System Events through a certain degree of internal testing and real-time monitoring, and the use of independent safeguards in the overall portfolio management system and often, with respect to proprietary models, in the software code itself. Despite such testing, monitoring and independent safeguards, System Events will result in, among other things, the execution of unanticipated trades, the failure to execute anticipated trades, delays in the execution of anticipated trades, the failure to properly allocate trades, the failure to properly gather and organize available data, the failure to take certain hedging or risk reducing actions and/or the taking of actions which increase certain risk(s)—all of which may have materially negative effects on the Software and/or its returns.

 

The strategies of the Software are highly reliant on the gathering, cleaning, culling and analysis of large amounts of Data. Accordingly, Models rely heavily on appropriate Data inputs. However, it is not possible or practicable to factor all relevant, available Data into forecasts and/or trading decisions of the Models. NAHD uses its discretion to determine what Data to gather with respect to each Strategy and what subset of that Data the Models take into account to produce forecasts which may have an impact on ultimate trading decisions. In addition, due to the automated nature of Data gathering, the volume and depth of Data available, the complexity and often manual nature of Data cleaning, and the fact that the substantial majority of Data comes from third-party sources, it is inevitable that not all desired and/or relevant Data will be available to, or processed by, NAHD (the "Manager") at all times. If incorrect Data is fed into even a well-founded Model, it may lead to a System Event subjecting the Software to loss. Further, even if Data is input correctly, "model prices" anticipated by the Data through the Models may differ substantially from market prices.

 

Where incorrect or incomplete Data is available, NAHD may, and often will, continue to generate forecasts and make trading decisions based on the Data available to it. Additionally, it may determine that certain available Data, while potentially useful in generating forecasts and/or making trade decisions, is not cost effective to gather due to either the technology costs or third-party vendor costs and, in such cases, the Manager will not utilize such Data. There is no guarantee that any specific Data or type of Data will be utilized in generating forecasts or making trading decisions with respect to the Models, nor is there any guarantee that the Data actually utilized in generating forecasts or making trading decisions underlying the Models will be the most accurate data available. It is assumed that the Data set used in connection with the Models is limited and should understand that the foregoing risks associated with gathering, cleaning, culling and analysis of large amounts of Data are an inherent part of the development with a process-driven, systematic adviser such as the Manager.

 

When Models and Data prove to be incorrect, misleading or incomplete, any decisions made in reliance thereon expose the Software to potential losses. For example, by relying on Models and Data, the system may be induced to trade at positions that are too high, to sell at positions that are too low, or to miss favorable opportunities altogether. In addition, Models may incorrectly forecast future behavior, leading to potential losses and/or a mark-to-market basis. Furthermore, in unforeseen or certain low-probability scenarios (often involving a market disruption of some kind), Models may produce unexpected results which may or may not be System Events.


11


Errors in Models and Data are often extremely difficult to detect, and, in the case of proprietary models and third-party models, the difficulty of detecting System Events may be exacerbated by the lack of design documents or specifications. Regardless of how difficult their detection appears in retrospect; some System Events will go undetected for long periods of time and some may never be detected. The degradation or impact caused by these System Events can compound over time. Finally, NAHD will detect certain System Events that it chooses, in its sole discretion, not to address or fix, and the third-party software will lead to System Events known to the Manager that it chooses, in its sole discretion, not to address or fix.

 

The Company believes that the testing and monitoring performed on its models and third party models will enable it to identify and address those System Events that a prudent person managing a process-driven, systematic and computerized software program would identify and address by correcting the underlying issue(s) giving rise to the System Events or limiting the use of proprietary and third party models, generally or in a particular application. Holders should assume that System Events and their ensuing risks and impact are an inherent part of development with a process-driven, systematic investment manager such as NAHD, as the Manager. Accordingly, NAHD does not expect to disclose discovered System Events to the Software or to Holders.

 

The Software will bear the risks associated with the reliance on Models and Data including that the Software will bear all losses related to System Events other than in relation to losses arising from the Manager's willful default, fraud or gross negligence.

 

Involuntary Disclosure Risk

 

The ability of the system to achieve its goals for the Software is dependent in large part on its ability to develop and protect its models and proprietary research. The models and proprietary research and the Models and Data are largely protected by NAHD through the use of policies, procedures, agreements, and similar measures designed to create and enforce robust confidentiality, non-disclosure, and similar safeguards. However, aggressive position-level public disclosure obligations (or disclosure obligations to exchanges or regulators with insufficient privacy safeguards) could lead to opportunities for competitors to reverse-engineer the Manager's models, and thereby impair the relative or absolute performance of the Software.

 

Specific Risks

 

Liquidity Risk

 

Liquidity represents the volume of Forex transactions that can be executed for a certain currency pair at a certain time. The liquidity depends on the number of Forex market participants and the size of the market participants' offers. The major currencies which are the most traded usually offer a better liquidity than any other currencies. The liquidity is subject to sharp fluctuations depending on the currency, the economic or political events and news such as financial crisis, or to any other events which are beyond the control of NAHD.

 

A market with low liquidity would increase the risk associated with Forex trading significantly. In a case of low liquidity, the Holder may not be able to buy or sell orders or may need to liquidate all or parts of its positions at high losses.

 

Volatility Risk

 

As Forex market is subject to high degree of volatility, the currency prices would also be subjected to extensive fluctuations in response to numerous factors which are often beyond the control of NAHD. The market can move acutely in favor or against the Holder's positions. A drop in market liquidity, any unanticipated changes in economic or political conditions, a financial crisis or any other event can (though it may not) accelerate the market conditions in which currency price could move sharply and unexpectedly higher or lower in a volatile pattern.


12


Market and Price Risks

 

The Software's strategy is subject to some dimension of market risk: directional price movements, deviations from historical pricing relationships, changes in the regulatory environment, changes in market volatility, "flights to quality", "credit squeezes", etc. The NAHD style of alternative trading may be no less speculative than traditional strategies. On the contrary, due in part to the degree of leverage embedded in software in which the Software may invest, the Software may from time to time incur sudden and dramatic losses.

 

The particular or general types of market conditions in which the Software may incur losses or experience unexpected performance volatility cannot be predicted, and the Software may materially under-perform. The Holder's position on various transactions may be liquidated at a loss where the Holder will then be liable for any resulting deficit. Under certain circumstances, it may be difficult to liquidate an existing position, assess the value, determine a fair price or assess its exposure to risk.

 

Foreign Exchange Risk

 

Transactions involving currencies would incur risks including, but not limited to, the potential for changing political and/or economic conditions that may substantially affect the price or liquidity of a currency. Foreign exchange speculation may also be susceptible to sharp rises and falls as the relevant market values fluctuate.

 

Leverage Risk

 

The Software makes use of leverage on relatively small margin deposits. Trading on margin and leverage means that the Holder can buy and sell assets that represent more value than the capital in the Holder's account. A leverage of 50 times means the Holder can buy or sell up to $1,000,000 worth with only a capital of $20,000. High leverage or low margin can result in significant losses as a relatively small price movement may cause a proportionately larger impact on participating placements. The leveraged nature of the Software means that the Holder would increase his exposure risk the volatility of the market and a change in the market would result in greater change in the position taken by the Holder ("leverage effect"). Holders may get back less than placed and, in the case of higher risk strategies, Holders may lose the entirety of their placement.

 

Currency Risk

 

Currency trading presents unique risks. The interbank market consists of a direct dealing market, in which a participant trades directly with a participating bank or dealer, and a brokers' market. The brokers' market differs from the direct dealing market in that the banks or financial institutions serve as intermediaries rather than principals to the transaction. In the brokers' market, brokers may add a commission to the prices they communicate to their customers, or they may incorporate a fee into the quotation of price.

 

Arbitrage and Spread Trading Risks

 

Arbitrage and spread strategies attempt to take advantage of perceived price discrepancies of identical or similar financial instruments, on different markets or in different forms. To the extent the price relationships between such positions remain constant, no gain or loss on the positions will occur. If the requisite elements of an arbitrage strategy are not properly analyzed, or unexpected events or price movements intervene, losses can occur which can be magnified to the extent the Software is employing leverage. Arbitrage strategies often depend upon identifying favorable "spreads" which can also be identified, reduced or eliminated by other market participants. In periods of trendless, stagnant markets and/or deflation, many alternative strategies have materially diminished prospects for profitability.


13


Quantitative Trading

 

Quantitative trading strategies are highly complex, and, for their successful application, require relatively sophisticated mathematical calculations and relatively complex computer programs. These trading strategies are dependent upon various computer and telecommunications technologies and upon adequate liquidity in the markets traded. The successful execution of these strategies could be severely compromised by, among other things, a diminution in the liquidity of the markets traded, telecommunications failures, power loss and software-related "system crashes." There are also periods when even an otherwise highly successful system incurs major losses due to external factors dominating the market, such as natural catastrophes and political interventions. Transaction costs incurred by quantitative trading strategies may be significant. In addition, the difference between the expected price of a trade and the price at which a trade is executed, or "slippage," may be significant and may result in losses.

 

Due to the nature of their trading, quantitative trading firms may suffer devastating losses in a very short period of time. For example, in August 2012 Knight Capital accidentally deployed test software code to a production environment, causing a major disruption in the stock prices of over 100 listed companies which in turn resulted in the collapse of Knight Capital's stock price. A similar trading software mistake by the Manager could result in material or even total losses to the Software and NAHD.

 

Reliance on Technology and Electronic Trading

 

NAHD relies heavily on computer hardware and software, online services and other computer-related or electronic technology and equipment to facilitate the Software's activities. Specifically, the Software may trade financial instruments through electronic trading or order routing systems, which differ from traditional open outcry pit trading and manual order routing methods. Such electronic trading exposes the Software to risks associated with system or component failure, which could render NAHD unable to enter new orders, execute existing orders or modify or cancel previously entered orders. System or component failure may also result in loss of orders or order priority. Should events beyond NAHD's control cause a disruption in the operation of any technology or equipment, the Software's program may be severely impaired, causing it to experience substantial losses or other adverse effects.

 

A disaster or a disruption in the infrastructure that supports NAHD's business, including a disruption involving electronic communications or other services used by it or third parties with whom it conducts business, or directly affecting one of its offices or facilities, may have a material adverse effect on its ability to continue to operate the business without interruption. Although the Manager and its affiliates have back-up facilities for their information systems as well as technology and business continuity programs in place, there can be no assurance that these will be sufficient to mitigate the harm that may result from such a disaster or infrastructure disruption. In addition, insurance and other safeguards might only partially mitigate the effects of such a disaster or disruption.

 

Systems Security

 

Despite the implementation of operating controls for detecting unauthorized intrusion, security breach and security attack, NAHD will be unable to prevent all forms of unauthorized access to the systems it operates and the systems it uses which are provided by third-party service providers. NAHD will not be held liable for any trading or personal data leakage and any consequences and will not reimburse the Software for any loss caused by the unauthorized intrusion to its systems which is out of the Manager's control.

 

Technical Analysis and Trading Systems

 

NAHD employs technical analysis and/or technical trading systems. Technical strategies rely on information intrinsic to the market itself to determine trades, such as prices, price patterns, momentum, volume and volatility. As discussed above, these strategies can incur major losses when factors exogenous to the markets themselves, including political events, natural catastrophes, acts of war or terrorism, dominate the markets.


14


Failure of Algorithms

 

NAHD will utilize sophisticated computerized models to automatically determine and execute trade entry and exit conditions and manage risk. NAHD makes efforts to test management and software releases to ensure that these algorithms operate correctly. However, it is possible that a defect in algorithm design or implementation or risk management could unexpectedly manifest and cause sustained long-term or virtually instantaneous catastrophic losses for the Software.

 

Possible Effects of Technical Trading Systems

 

There has been, in recent years, a substantial increase in interest in technical futures trading systems, similar to NAHD's systems. As the capital under the management of such trading systems based on the same general principles increases, an increasing number of traders may attempt to initiate or liquidate substantial positions at or about the same time as the Software, or otherwise alter historical trading patterns or affect the execution of trades, to the significant detriment of the Software.

 

Cybersecurity Risk

 

NAHD's hardware and software systems are subject to threats from hackers and others, such as a malicious attack, malware or other event that leads to unanticipated interruption or malfunction of such systems. Any interruption of NAHD's hardware or software functionality could lead to material or even complete losses to the Software. Hackers could also theoretically access and steal the Manager's research, models, trading programs or other software or data and implement such programs or software on their own behalf. This could lead to increased competition for, or elimination of, the opportunities sought by the Software or otherwise render the models developed by NAHD obsolete, possibly resulting in material or complete losses to the Software.

 

Failure of Connectivity

 

NAHD's models may trade frequently and may depend on low latency to be profitable. As a result, the success of the Manager's models depends on network connectivity. Any disruption or failure of the Manager's network connectivity, or even a delay in transmission speed, could result in substantial or total losses to the Software.

 

Computer Hardware and Software

 

Many components of the Manager's critical computer hardware and software may have flaws, may not be redundant, may be leased rather than owned, or may be provided in whole or in part by another party. Should these components fail or be inaccessible, there is no certainty that the Manager will be able to recover promptly and the Software may suffer material or total losses as a result.

 

Risks of Ineffective Risk Management Systems

 

NAHD continuously reviews and refines its risk management techniques, strategies and assessment methods. However, such risk management techniques and strategies may not fully mitigate the risk exposure of the Software in all economic or market environments, or against all types of risk, including risks that the Manager might fail to identify or anticipate. Any failures in the Manager's risk management techniques and strategies to accurately quantify such risk exposure could limit its ability to manage risks in the Software or to seek adequate risk-adjusted returns.


15


Accidental, Erroneous and Fraudulent Trades; Slippage

 

The transactions the Software executes are intended to be based on the bid and ask prices presented to the traders of NAHD by each counterparty. It is anticipated that the prices may be displayed on a computer monitor and that contracts may be executed electronically. The Software has no assurance that the prices displayed will be accurate. Various flaws in communications systems, such as data entry errors and transmission errors, can result in corrupted or inaccurate data. Moreover, the Software has no assurance that a continuous display of electronic connectivity between the Software and its counterparties can be maintained. Communication failures such as electrical outages, computer failures and hard drive failures can result in an inability of the systems to initiate or complete a transaction. There can be no assurance that errors in communication would not lead to erroneously executed transactions or a failure to execute transactions that would have been intended to hedge the Software's positions. The performance of the Software can be affected by data transmissions that are delayed. This phenomenon is sometimes also called latency. The Software has no assurance that performance will not be adversely affected by latency. The Software's counterparties have not made any representation to the Software that any particular level of latency will be maintained, nor that the counterparty would not deliberately degrade latency. Execution of a contract at an erroneous price can therefore affect the performance of the Software.

 

Impacts of Recent Geopolitical Events

 

Volatility of the price of oil, current developments in Syria, Iraq, Afghanistan and the Middle East generally, the continued threat of terrorism, the ongoing military and other actions and heightened security measures in response to these threats, international and regional military tensions and instability in the credit and sub-prime markets may cause disruptions to commerce, reduced economic activity and continued volatility in markets throughout the world. Such systemic risks may have an adverse impact on some of the assets in the Software's portfolio in the event that such risks result in a decline in the securities markets and economic activity. NAHD cannot predict at this time the extent and timing of any decreased commercial and economic activity resulting from the above factors, or how any such decrease might affect the value of the Software. The aforementioned factors could also result in incidents or circumstances that would disrupt the normal operations of the Manager and the Partners, which could also have negative effects on the performance of the Software.

 

Disclosure of System Portfolio

 

The statements of the Software will not include a detailed listing of positions held by the Software. Such confidentiality is maintained to prevent third parties from using information concerning the Managers or the Software's positions to its detriment. Examples of ways in which such information could be used adversely to the Software include: (a) to "front run" the Software on sales, or additional purchases, of such positions; (b) to make it more difficult for the Software to protect its positions by withholding, or causing others to withhold, prospective trades; (c) to make it difficult to acquire or borrow securities; or (d) otherwise to interfere with the Software's objectives. For this reason, NAHD believes it is important to take extra precautions to maintain the confidentiality of the positions in the Software's portfolio. However, NAHD, in its sole discretion, may permit such disclosure on a selective basis to certain Holders, if it determines that there are sufficient confidentiality agreements and procedures in place.

 

Disaster Recovery

 

NAHD has only limited disaster recovery plans for our operations, and we rely on outside parties, including the Partners, for some key accounting and operational functions, that in turn may also have limited disaster recovery plans. There is no assurance that any of these disaster recovery plans will work, which could result in significant losses to the Software.


16


Risk Management and Compliance Control

 

Risk management is about the selection and sizing of exposures, to maximize returns for a given level of risk. The function of risk management in the system process is to determine whether it is more prudent to eliminate or limit the size of each kind of risk exposure and to provide the input into the portfolio construction model.

 

Reducing risk almost always comes with the cost of reducing return. Risk management activities is focused on reducing or eliminating exposure to unnecessary risks but also taking on risks that offer expected attractive payoffs. The Managers uses a risk model in order to controls and deals with the size of unnecessary risk exposures.

 

Each Series of Algorithms and its models is tested to be resilient during major financial events as it is back-tested for a minimum of 3 years. Risks from past major financial event/crisis are also applied to test the resilience of these Models.  Back-testing is a specific type of historical testing that determines the performance of the Model if it had actually been employed during past periods and market conditions. While back-testing does not allow one to predict how a Model will perform under future conditions, its primary benefit lies in understanding the vulnerabilities of a Model through a simulated encounter with real-world conditions of the past. This enables the Managers to "learn from history" without actually having to make them with actual money.

 

The Forex markets can move fast, with gains turning into losses in a matter of minutes therefore making it critical for the NAHD Team to properly manage Holder's capital. NAHD makes use of the following methods to control the risk and protect Holders' profits.

 

Capping Losses

 

Risk must be predetermined. It is the best way to make sure one's losses are controlled and the most rational time to consider risk is during the design of the model. It is acceptable to sustain a drawdown of 10% if it was the result of five consecutive losing trades that were stopped out at 2% loss each. However, it is inexcusable to lose 10% on one trade.

 

High Probability Profit Targets

 

The NAHD Team ensures that each Series of Algorithms has a winning percentage of above 50%. It means that there would be at least 50% worth of profit trades in total.

 

High Probability Set Up

 

The Manager ensures that each Series of Algorithms has a set up percentage of above 70%. It means that there would be at least 70% probability of each Series of Algorithms achieving its objective.

 

Tight Money Management

 

Half of trading is about strategy; the other half is about money management. In order to manage the risk and profits, the Manager needs to ensure that a maximum of 2% of the capital is used per trade.

 

Other Risks

 

We will need additional capital to sustain our operations and will likely need to seek further financing to accelerate our growth, which we may not be able to obtain on acceptable terms or at all. If we are unable to raise additional capital, as needed, the future growth of our business and operations would be severely limited.

 

A factor limiting our growth, including our ability to enter our proposed markets, attract customers, and deliver our proprietary trading software to the financial community, is our limited capitalization overall and as compared to other companies in the industry.


17


We will need additional capital to bring our operations to a sustainable level over the next twelve months. In 2019, we raised approximately $124,913 from advances from our principal shareholder in connection with and after the change of control in February 2015. We believe that, in addition to the capital raised thus far, we will require up to an additional $150,000 for the next 12 months to satisfy our operating cash needs for the current business, however, additional capital may be required for the implementation of the expanded new business opportunities (as described above). The details on these new business opportunities will be provided in the coming quarters along with the required capital inflows. However, given the status of current business operations within the next 12 months, we will need to seek additional financing.

 

We may also seek additional financing to accelerate our growth. If we raise additional funds through the issuance of equity or convertible debt securities, the percentage ownership of the Company held by existing shareholders will be reduced and our shareholders may experience significant dilution. In addition, new securities may contain rights, preferences or privileges that are senior to those of our common stock. If we raise additional capital by incurring debt, this will result in increased interest expense. There can be no assurance that acceptable financing necessary to further implement our plan of operation can be obtained on suitable terms, if at all. Our ability to develop our business could suffer if we are unable to raise additional funds on acceptable terms, which would have the effect of limiting our ability to generate and increase our revenues, develop our products, attain profitable operations, or even may result in our business filing for bankruptcy protection or otherwise ending our operations which could result in a significant or complete loss of your investment.

 

We have incurred significant losses in prior periods, and losses in the future could cause the trading price of our stock to decline or have a material adverse effect on our financial condition, our ability to pay our debts as they become due and on our cash flows.

 

We have incurred significant losses in prior periods. Our accumulated deficit at December 31, 2019 was $12,148,029. We incurred net loss in 2019 $180,002 and a net loss in 2018 of $145,748. If we are not able to attain profitability in the near future and long-term future, the trading price of our stock could decline and our financial condition could deteriorate as we could, among other things, deplete our cash, incur additional indebtedness and issue additional equity that could cause significant dilution, all of which could have a material adverse impact on our business and prospects and result in a significant or complete loss of your investment.

 

We have unsecured loans that are overdue, and we will likely need to raise capital to repay the loan or will need to convert the loan to our common stock at the discretion of our principal shareholder.

 

During 2015, we received interest free loans from New Asia Holdings Ltd, our principal shareholder, in the aggregate principal amount of $316,533 to pay for operating expenses and investments of the Company that were due to be repaid on October 31, 2015. However, if the Company was unable to repay these loans by such date, New Asia Holdings Ltd, at its sole discretion, would have the option to extend the repayment deadline or convert all or a portion of the above Advances into Common Stock at a conversion price of $0.02 per share. As of December 31, 2019, New Asia Holdings Ltd had not yet acted to exercise its option to convert the loans to shares of common stock, thus the loans presently remain as an interest-free loan to the Company. As of December 31, 2019, we had received total interest free loans from New Asia Holdings Ltd in the aggregate principal amount of $836,452. If we are unable to repay these loans or convert the loan, this would likely have a material adverse effect on our operations, our ability to raise capital and the price of our stock.

 

If New Asia Holdings Ltd coverts the loan and/or we raise additional funds through the issuance of equity or convertible debt securities to pay off the loan, the percentage ownership of the Company held by existing shareholders will be reduced and our shareholders may experience significant dilution. In addition, new securities may contain rights, preferences or privileges that are senior to those of our common stock. If we raise additional capital by incurring debt, this will result in increased interest expense. There can be no assurance that acceptable financing necessary to further implement our plan of operation can be obtained on suitable terms, if at all. Our ability to develop our business could suffer if we are unable to raise additional funds on acceptable terms, which would have the effect of limiting our ability to increase our revenues, develop our products, attain profitable operations, or even may result in our business filing for bankruptcy protection or otherwise ending our operations which could result in a significant or complete loss of your investment.


18


We have a limited operating history, which may make it difficult for investors to predict future performance based on current operations.

 

We have limited operating history upon which investors may base an evaluation of our potential future performance. As a result, there can be no assurance that we will be able to develop consistent revenue sources, or that our operations will be profitable. Our prospects must be considered in light of the risks, expenses, and difficulties frequently encountered by companies in early stage of development.

 

Any forecasts we make about our operations, including, without limitation, sales and plans for raising capital, may prove to be inaccurate. We must, among other things, determine appropriate risks, rewards, and level of investment in each project, respond to economic and market variables outside of our control, respond to competitive developments and continue to attract, retain and motivate qualified employees. There can be no assurance that we will be successful in meeting these challenges and addressing such risks and the failure to do so could have a materially adverse effect on our business, results of operations and financial condition. As a result, the value of your investment could be significantly reduced or completely lost.

 

Our independent auditors’ report for the fiscal years ended December 31, 2019 and 2018 is qualified as to our ability to continue as a going concern.

 

Due to the uncertainty of our ability to meet our current operating and capital expenses, in their report on our audited annual financial statements as of and for the years ended December 31, 2019 and 2018, our independent auditors included an explanatory paragraph regarding concerns about our ability to continue as a going concern. Recurring losses from operations raise substantial doubt about our ability to continue as a going concern. The presence of the going concern explanatory paragraph may have an adverse impact on the relationships we are developing and plan to develop with third parties as we continue the commercialization of our products and could make it challenging and difficult for us to raise additional financing, all of which could have a material adverse impact on our business and prospects and result in a significant or complete loss of your investment.

 

Our actual operating results may differ significantly from any guidance or estimates we may provide.

 

From time to time, we may release guidance estimates in our quarterly and annual earnings releases, quarterly and annual earnings conference calls, or otherwise, regarding our future performance that represents our management's estimates as of the date of release. Although we believe that any such guidance or estimates would provide investors and analysts with a better understanding of management's expectations for the future and could be useful to our stockholders and potential stockholders, such guidance or estimates would consist of forward-looking statements subject to the risks and uncertainties described in this report and in our other public filings and public statements. Guidance and estimates are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying the guidance or estimates may not materialize or may vary significantly from actual results. Our actual results may not always be in line with or exceed any guidance or estimates we may provide, especially in times of economic uncertainty. If our financial results for a particular period do not meet our guidance or estimates or the expectations of investors or research analysts, or if we reduce our guidance or estimates for future periods, the market price of our common stock may decline. In light of the foregoing, investors are urged not to unduly rely upon any guidance or estimates in making an investment decision regarding our common stock.

 

We face competition for customers from other providers of technology solutions to participants in the financial services community. If prospective customers are reluctant to switch from their existing service providers and adopt our products and services, our sales will not grow or may decline, we could be materially and adversely affected, and our stock price could decline significantly.


19


Potential customers that use legacy products and services for their trading needs may believe that these products and services sufficiently achieve their purpose. In addition, an organization's existing vendors or new vendors with broad product and service offerings may be able to offer concessions to our potential customers that we are not able to match. Accordingly, organizations may continue allocating their resources and information technology budgets for legacy products and services and may not switch to our products and services. If our products and services do not find widespread marketplace acceptance, then our sales may not grow or may decline, which could materially and adversely affect us and cause our stock price to decline significantly.

 

We face significant competition for the types of products and services that we offer and may be unable to compete effectively for market share.

 

Our success depends significantly upon our ability to increase our market share, to increase our revenues from new customers and to sell additional products and product enhancements to new customers. The market for the types of products and services that we offer is intensely competitive. Our competitors may develop products that are superior to our proprietary trading software in terms of quality, ease of use, security, reliability or cost or may achieve greater market acceptance. Our competitors or potential competitors may have significantly greater financial, technical and marketing resources and access to capital than we do. As a result, they may be able to respond more quickly to new or emerging technologies and to changes in customer demands, or to devote greater resources to the development, promotion and sale of their products and services than we can. We may be unable to compete successfully against current or future competitors, which could materially and adversely affect us and cause our stock price to decline significantly.

 

If functionality similar or superior to that offered by our products and services is developed by competitors, it could materially and adversely affect us and cause our stock price to decline significantly.

 

Large, well-established providers of trading technologies may introduce features that compete with our proprietary trading software, either in stand-alone products or as additional features to their existing technologies. In addition, other companies may emerge that offer products and services that compete with those we offer. The introduction by competitors of products and services, or the announcement of an intent to offer products and services, that include functionality perceived to be similar or superior to that offered by our platform may adversely affect our ability to market and sell our products and services, which could materially and adversely affect us and cause our stock price to decline significantly. Furthermore, even if the functionality offered by these providers is more limited than our products and services, a significant number of organizations may nevertheless subscribe to such limited functionality offered by other providers instead of our products and services, whether because they do not wish to add an additional vendor such as us, for cost reasons, for relationship reasons or otherwise.

 

A systemic or systematic market event that impacts the various market participants with whom we interact could materially and adversely affect us and cause our stock price to decline significantly.

 

In the event of deteriorating or stagnant market conditions, there could be a reduction in the types of financial instruments traded or a reduction in trading volumes of financial instruments globally. These factors could cause revenues from our customers to decrease, which could adversely affect our business and operating results, potentially materially. Our profitability may also be adversely affected by our fixed costs and the possibility that we may be unable to reduce other costs within a time frame sufficient to match any decreases in revenue relating to deteriorating conditions. Accordingly, deteriorating or stagnant market conditions could materially and adversely affect us and cause our stock price to decline significantly.


20


If we do not manage our growth effectively, our operating results may be materially and adversely affected, and our stock price could decline significantly.

 

The growth and expansion of our business and product and service offerings will place a significant strain on our management, operational and financial resources. To manage our growth effectively, we will need to continue to improve our algorithm products, our operating, accounting, financial and administrative systems and our procedures, controls and processes, including, without limitation:

 

 

significantly enhancing our internal controls to ensure timely and accurate reporting of all of our operations and financial results, and hiring additional personnel in areas such as accounting, finance, regulatory compliance and other important areas;

 

expanding and improving our key business applications, processes and IT infrastructure, including without limitation those relating to accounting and financial reporting, to support our business needs;

 

enhancing information and communication systems to ensure that our employees and officers are well-coordinated and can effectively communicate with each other and our growing customer base; and

 

appropriately documenting our IT systems and our business processes.

 

These improvements may require meaningful capital expenditures and allocation of management and personnel and consultant resources. Our failure to make these improvements or hire any additional necessary personnel, or the failure of our systems, procedures, controls and processes to operate in the intended manner, may result in our inability: to manage our expected growth, which could materially and adversely affect our operating results; to accurately report or forecast our revenue, expenses and earnings; or to prevent certain losses.

 

Failures in our compliance systems could subject us to significant legal and regulatory costs. Furthermore, if our risk management methods are not effective, our business, reputation and financial results may be adversely affected.

 

Our ability to comply with all applicable laws and regulations is largely dependent on our establishment and maintenance of compliance, audit and reporting systems and procedures, as well as our ability to attract and retain qualified compliance, audit and risk management personnel. These systems and procedures may not be fully effective. We face the risk of intervention by regulatory authorities, including extensive examination and surveillance activity. In the case of actual or alleged non-compliance with regulations, we could be subject to investigations and judicial or administrative proceedings that may result in penalties or civil lawsuits for damages, which can be substantial. Any failure to comply with applicable laws and regulations could adversely affect our business, reputation, financial condition and operating results and, in extreme cases, our ability to conduct our business or portions thereof.

 

We depend on our senior management team and the loss of one or more key employees, the failure of new executive officers to integrate with our management team or our failure to attract and retain other highly qualified personnel in the future, could have a negative impact on our business.

 

Our success depends largely on the efforts and abilities of the key members of our senior management team, including Lin Kok Peng, PhD, who serves as the Company's Chief Executive Officer, Chief Financial Officer, and Chairman of the Board as well as a director, Jose Capote, who serves as the Company's Vice President and Secretary, and Allister Lim Wee Sing, who serves as a director of the Company. Because each member of our senior management team has a different area of specialization, the departure of any one of these individuals could create a deficiency in one of the core aspects of our business. Any failure of our management team to successfully integrate could also have a negative impact on our business. We are also dependent on the efforts of our team of technology professionals, and on our ability to recruit and retain highly skilled and often specialized personnel, particularly in light of the rapid pace of technological advances. The level of competition in the technology industry for individuals with this level of experience or these skills is intense. Significant losses of key personnel, particularly to competitors, could make it difficult for us to compete successfully. In addition, we may be unable to attract and retain qualified management and personnel in the future, including in relation to any diversification of our product and service offerings into new asset classes and/or new geographic locations.


21


We will rely on revenue from licensing or subscription fees. Because we will recognize revenue from licensing or subscription fees over the term of the relevant service period, downturns or upturns in sales may impact our future operating results.

 

Sales of new or renewal licensing or subscription contracts may decline and fluctuate as a result of a number of factors, including customer satisfaction with our products and services, the price of our products and services, the quality, ease of use and prices of products and services offered by our competitors and reductions in our customers' spending levels. Furthermore, our customers generally have no contractual obligation to renew their contracts after the initial contract term. We have no historical data with respect to rates of customer renewals, so we may not be able to accurately predict future renewal trends. If our sales of new or renewal subscription contracts decline, our future revenue and revenue growth may decline, and our business may suffer.

 

We may not be able to effectively manage our growth or improve our operational, financial and management information systems, which would impair our results of operations.

 

If we are successful in executing our business plan, we will experience growth in our business that could place a significant strain on our business operations, finances, management and other resources. Our ability to manage our growth will require us to improve our operational, financial and management information systems, and to motivate and effectively manage our employees. We cannot provide assurance that our systems, procedures and controls or financial resources will be adequate, or that our management will keep pace with this growth. We cannot provide assurance that our management will be able to manage this growth effectively, which could have a material adverse effect on our financial condition or business.

 

Our ability to sell our products will be dependent in part on the quality of our technical support services, and our inability to offer high quality technical support services could adversely affect our customers' satisfaction with our products and services and could materially and adversely affect us and cause our stock price to decline significantly.

 

Our customers will depend on our technical support services to resolve issues relating to our service offerings. If we do not effectively onboard our customers, succeed in helping our customers quickly resolve post-onboarding issues and provide effective ongoing support, our ability to sell additional products and services to existing customers would be adversely affected and our reputation with potential new customers could be damaged. If we fail to meet the requirements of our customers, it may be more difficult to execute on our strategy to retain these customers. Our failure to maintain quality technical support services could materially and adversely affect us and cause our stock price to decline significantly.

 

Failure to comply with governmental laws and regulations could harm our business, materially and adversely affect us and cause our stock price to decline significantly.

 

Our business is subject to regulation by various federal, state, local and foreign governmental agencies, including agencies responsible for monitoring and enforcing employment and labor laws, workplace safety, product safety, environmental laws, consumer protection laws, anti-bribery laws, import/export controls, federal securities laws and tax laws and regulations. In certain jurisdictions, these regulatory requirements may be more stringent than those in the United States. Noncompliance with applicable regulations or requirements could subject us to investigations, sanctions, revocation of required licenses, enforcement actions, disgorgement of profits, fines, damages, civil and criminal penalties or injunctions. If any governmental sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, we could be materially and adversely affected. In addition, responding to any action will likely result in a significant diversion of management's attention and resources and an increase in legal and professional costs and expenses. We provide passive communication technology to institutional investors, such as money managers and hedge funds, that enables such investors to communicate with executing brokers, prime brokers and clearing firms with respect to securities orders that such investors may place with third party brokers through our platform.


22


We do not conduct our technology business in or through our broker-dealers. As such, we must ensure that our technology activities and our compensation structure therefor would not result in our acting as an unregistered broker-dealer or investment adviser that could subject us to, among other things, regulatory enforcement actions, monetary fines, restrictions on the conduct of our technology business and rescission/damages claims by customers who use our technology. Our failure to comply with any laws or regulations, or the costs associated with defending any action alleging our noncompliance with any laws or regulations, could materially and adversely affect us and cause our stock price to decline significantly.

 

RISK FACTORS CONCERNING INVESTMENT IN OUR COMPANY

 

There is currently a limited public market for our shares, and if an active market does not develop, investors may have difficulty selling their shares.

 

Our common stock is currently traded on the over the counter (OTC) market on the OTCQB tier of the OTC Markets, and there is currently only a limited public trading market for our common stock. We cannot predict the extent to which investor interest in the Company and our common stock will lead to the development or continuance of an active trading market or how liquid that trading market for our common stock might become. If an active trading market for our common stock does not develop or is not sustained, it may be difficult for investors to sell shares, particularly large quantities, of our common stock at a price that is attractive or at all. As a result, an investment in our common stock may be illiquid and investors may not be able to liquidate their investment readily or at all when they desire to sell.

 

Regulation of penny stocks.

 

The SEC has adopted a number of rules to regulate "penny stocks." Because the securities of the Company may constitute "penny stocks" within the meaning of the rules (as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, other than a security registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in that security are provided by the exchange or system), the rules would apply to the Company and to its securities. The SEC has adopted Rule 15g-9 which established sales practice requirements for certain low-price securities. Unless the transaction is exempt, it shall be unlawful for a broker or dealer to sell a penny stock to, or to effect the purchase of a penny stock by, any person unless prior to the transaction: (i) the broker or dealer has approved the person's account for transactions in penny stock pursuant to this rule and (ii) the broker or dealer has received from the person a written agreement to the transaction setting forth the identity and quantity of the penny stock to be purchased. In order to approve a person's account for transactions in penny stock, the broker or dealer must: (a) obtain from the person information concerning the person's financial situation, investment experience, and investment objectives; (b) reasonably determine that transactions in penny stock are suitable for that person, and that the person has sufficient knowledge and experience in financial matters that the person reasonably may be expected to be capable of evaluating the risks of transactions in penny stock; (c) deliver to the person a written statement setting forth the basis on which the broker or dealer made the determination (i) stating in a highlighted format that it is unlawful for the broker or dealer to affect a transaction in penny stock unless the broker or dealer has received, prior to the transaction, a written agreement to the transaction from the person; and (ii) stating in a highlighted format immediately preceding the customer signature line that (A) the broker or dealer is required to provide the person with the written statement and (B) the person should not sign and return the written statement to the broker or dealer if it does not accurately reflect the person's financial situation, investment experience, and investment objectives; and (d) receive from the person a manually signed and dated copy of the written statement.


23


It is also required that disclosure be made as to the risks of investing in penny stock and the commissions payable to the broker-dealer, as well as current price quotations and the remedies and rights available in cases of fraud in penny stock transactions. Statements, on a monthly basis, must be sent to the investor listing recent prices for the "penny stock" and information on the limited market. Shareholders should be aware that, according to SEC Release No. 34-29093, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns include: (i) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (ii) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (iii) "boiler room" practices involving high pressure sales tactics and unrealistic price projections by inexperienced sales persons; (iv) excessive and undisclosed bid ask differential and markups by selling broker-dealers; and (v) the wholesale dumping of the same securities by promoters and broker dealers after prices have been manipulated to a desired level, along with the resulting inevitable collapse of those prices and with consequent investor losses. The Company's management is aware of the abuses that have occurred historically in the penny stock market. Although the Company does not expect to be in a position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the confines of practical limitations to prevent the described patterns from being established with respect to the Company's securities.

 

There is limited liquidity in our common stock, which may adversely affect your ability to sell your shares of common stock.

 

The market price of our common stock may fluctuate significantly in response to a number of factors, some of which are beyond our control. These factors include, but are not limited to:

 

the announcement of new products or product enhancements by us or our competitors;

developments concerning intellectual property rights and regulatory approvals relating to us;

quarterly variations in our results or the results of our competitors;

the ability or inability of us to generate sales;

developments in our industry and target markets;

the number of market makers who are willing to continue to make a market in our stock and the market or exchange on which they decide to make a market in our stock, which may, among other things, result in our stock being traded on the exchanges that may be unattractive to investors such as "pink sheets"; and

general market conditions and other factors, including factors unrelated to our own operating performance.

 

In recent years, the stock market in general has experienced extreme price and volume fluctuations. Continued market fluctuations could result in extreme volatility in the price of shares of our common stock, which could cause a decline in the value of our shares. Price volatility may be accentuated if trading volume of our common stock is low. The volatility in our stock may be combined with low trading volume. Any or all of these above factors could adversely affect your ability to sell your shares or, if you are able to sell your shares, to sell your shares at a price that you determine to be fair or favorable.

 

Dependence upon outside advisors.

 

To supplement the business experience of its officers and directors, the Company may be required to employ accountants, technical experts, appraisers, attorneys, or other consultants or advisors. The selection of any such advisors will be made by the Company's officers, without any input by shareholders. Furthermore, it is anticipated that such persons may be engaged on an as needed basis without a continuing fiduciary or other obligation to the Company. In the event the officers of the Company consider it necessary to hire outside advisors, he may elect to hire persons who are affiliates, if those affiliates are able to provide the required services.


24


We may issue additional shares of common stock or preferred stock in the future, which could cause significant dilution to all shareholders.

 

We have a large amount of authorized but unissued common stock and preferred stock which our Board of Directors may issue without shareholder approval. We will need additional capital to bring our operations to a sustainable level over the next twelve months and may seek this capital in the form of equity financing. We may also seek to raise additional equity capital in the future to fund business alliances, develop new prototypes, and grow our services, manufacturing and sales capabilities organically or otherwise.

 

In addition to additional issuances of our common stock or preferred stock in private placements or public offerings, we may issue shares as part or all of the consideration in any merger, acquisition, joint venture or other strategic alliance that we enter.

 

Any issuance of additional shares of our common stock or preferred stock will dilute the percentage ownership interest of all shareholders and may dilute the book value per share of our common stock and may negatively impact the market price of our common stock.

 

We have not in the past and we do not currently intend to pay cash dividends on our common stock.

 

We have never declared or paid cash dividends on our common stock. We currently intend on retaining any future earnings to fund our operations and growth and do not expect to pay cash dividends in the foreseeable future of the common stock. Future dividends, if any, will be determined by our board of directors, based upon our earnings, financial condition, capital resources, capital requirements, charter restrictions, contractual restrictions, and such other factors as our board of directors deem relevant.

 

ITEM 1B.

UNRESOLVED STAFF COMMENTS.

 

Not Applicable.

 

ITEM 2.

PROPERTIES.

 

The Company currently maintains a mailing address at 11 Beach Road #06-01, Singapore and a U.S. office at 15615 Alton Parkway, Suite 450, Irvine CA 92618. The Company pays a monthly lease payment of approximately $3,900 per month for the Singapore office and services and $195 per month for the U.S. office.  

 

ITEM 3.

LEGAL PROCEEDINGS.

 

The Company is not a party to any pending legal proceedings, and no such proceedings are known to be contemplated.

 

ITEM 4.

MINE SAFETY DISCLOSURES.

 

Not applicable.


25


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 OTCQB tier of the OTC Markets. The OTC Market is a network of security dealers who buy and sell stock. The dealers are connected by a computer network that provides information on current "bids" and "asks", as well as volume information. Our common stock is quoted on the OTCQB under the symbol, “NAHD.”

 

The following table sets forth the high and low closing bid prices for the periods indicated for the Company's common stock.

 

 

 

Closing Bid Prices(1)

 

 

 

High

 

 

Low

 

Year Ending December 31, 2020

 

 

 

 

 

 

Quarter Ending June 30, 2020 (2)

 

$

0.0510

 

 

$

0.0500

 

Quarter Ended March 31, 2019

 

 

0.0701

 

 

 

0.0500

 

 

 

 

 

 

 

 

 

 

Year Ended December 31, 2019

 

 

 

 

 

 

 

 

Quarter Ended December 31, 2010

 

$

1.2100

 

 

$

0.0701

 

Quarter Ended September 31, 2019

 

 

0.2200

 

 

 

0.0500

 

Quarter Ended June 30, 2019

 

 

0.0979

 

 

 

0.0500

 

Quarter Ended March 31, 2019

 

 

0.0600

 

 

 

0.0500

 

 

 

 

 

 

 

 

 

 

Year Ended December 31, 2018

 

 

 

 

 

 

 

 

Quarter Ended December 31, 2018

 

$

0.1300

 

 

$

0.0600

 

Quarter Ended September 30, 2018

 

 

0.1300

 

 

 

0.0700

 

Quarter Ended June 30, 2018

 

 

0.1350

 

 

 

0.0700

 

Quarter Ended March 31, 2018

 

 

0.1500

 

 

 

0.0970

 

 

(1)Bids represent inter−dealer prices, without retail mark-up, markdown or commissions, and may not represent actual transactions. Accordingly, these quotations may or may not necessarily represent actual transactions. 

(2)Through April 16, 2020. 

 

On April 16, 2020, the closing price for our common stock on the OTCQB was $0.051 per share on no volume of shares. Because there were no shares traded on April 16, 2020 and generally, the volume of shares quoted on the OTC Markets is insignificant, the closing price quoted does not represent a reliable indication of the fair market value of these shares.

 

Approximate Number of Holders of Our Common Stock

 

As of April 17, 2020, there were approximately 299 holders of record of our common stock. The number of record holders does not include beneficial owners of common stock whose shares are held in the names of banks, brokers, nominees or other fiduciaries.

 

Common Stock

 

The Company's Articles of Incorporation authorize the issuance of 400,000,000 shares of common stock, par value of $0.001 per share ("Common Stock"). Each record holder of Common Stock is entitled to one vote for each share held on all matters properly submitted to the stockholders for their vote. The Company's Articles of Incorporation do not permit for cumulative voting for the election of directors. As of December 31, 2019, we had 72,288,667 shares of our Common Stock issued and outstanding.

 

Holders of outstanding shares of Common Stock are entitled to such dividends as may be declared from time to time by the Board of Directors out of legally available funds; and, in the event of liquidation, dissolution or winding up of the affairs of the Company, holders are entitled to receive, ratably, the net assets of the Company available to stockholders after distribution is made to the preferred stockholders, if any, who are given preferred rights upon liquidation. Holders of outstanding shares of Common Stock have no preemptive, conversion or redemptive rights.


26


All of the issued and outstanding shares of Common Stock are, and all unissued shares when offered and sold will be, duly authorized, validly issued, fully paid, and non-assessable. To the extent that additional shares of the Company's Common Stock are issued, the relative interests of then existing stockholders may be diluted.

 

Preferred Stock

 

The Company's Articles of Incorporation allow for the issuance of up to 30,000,000 shares of preferred stock, par value of $0.001 per share ("Preferred Stock"). As of the date of this filing, there are no shares of Preferred Stock issued and outstanding.

 

Recent Issuances of Unregistered Securities

 

None.


27


 

Transfer Agent

 

Our independent stock transfer agent is Pacific Stock Transfer. The transfer agent’s address is 4045 S. Spencer Street, Suite 403, Las Vegas, NV 89119. The transfer agent’s telephone number is (702) 361-3033, and its fax number is (702) 433-1979. Pacific Stock Transfer’s website is located at www.pacificstocktransfer.com.

 

ITEM 6.

SELECTED FINANCIAL DATA.

 

A smaller reporting company is not required to provide the information in this Item.

 

ITEM 7.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 

Forward-Looking Statements

 

This Management's Discussion and Analysis contains forward-looking statements that involve future events, our future performance and our expected future operations and actions. In some cases, you can identify forward-looking statements by the use of words such as "may", "will", "should", "anticipate", "believe", "expect", "plan", "future", "intend", "could", "estimate", "predict", "hope", "potential", "continue", or the negative of these terms or other similar expressions. These forward-looking statements are only our predictions and involve numerous assumptions, risks and uncertainties. Our actual results or actions may differ materially from these forward-looking statements for many reasons, including, but not limited to, the matters discussed in this report under the caption "Risk Factors". We urge you not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

 

The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes included in this annual report on Form 10-K.

 

Overview

 

Since December 24, 2014, New Asia Holdings, Inc., a Nevada corporation (the "Company" or "NAHD"), has been developing and deploying its proprietary, neural trading models for the financial community. We offer trading software solutions to clients on the basis of a software-as-a-service (“SaaS”) licensing and delivery models with licensed users availing themselves of service-based contractual arrangements.

 

The Company's products capitalize the large volume of the 24 hour Forex markets to achieve capital appreciation over a medium- to long-term basis, combined with the usage of a good wealth vehicle designed to control risk, profit from both bull or bear markets, and maximize liquidity and economic resilience.

 

Our proprietary trading models were developed by a team of professional engineers in communications, electronic circuitry design and financial engineering. This diverse team is the key factor in our successful development of non-traditional and innovative trading models. Our systems were designed to take intelligent positions as the market moves/changes and, upon development, our systems were to bring a rigorously tested track-record.

 

The NAHD systems were designed to adapt themselves and to take intelligent positions as the market moves/changes. The models were subjected to rigorous testing akin to the volatile trading environment of major financial events/crises that have happened in recent history. These models were also programmed to have the ability to learn and adapt new manners of trading, effectively translating the human behavioral of trading into a predictive science. The NAHD quantitative strategies and proprietary algorithmic trading system were developed to generate risk adjustable returns for its licensees and their clients.

 

Since 2016, the Company's focus has been to license its algorithm to licensees, regulated funds and banks to capitalize on the large volume of the 24-hour Forex markets to achieve capital appreciation over a medium- to long- term basis, combined with the usage of a good wealth vehicle designed to control risk, profit from both bull or bear markets, and maximize liquidity and economic resilience.

 

On August 25, 2015, the Company entered into a Sale and Purchase Agreement (the “Purchase Agreement”) with Anthony Ng Zi Qin, pursuant to which the Company acquired Magdallen Quant Pte Ltd (“MQL”). The MQL acquisition was accomplished through a share exchange with Anthony Ng Zi Qin of 7,422,000 restricted shares of common stock of the Company ("Consideration Shares"), with a value of $0.41 per share, and an aggregate fair value of $3,043,020, in exchange for the entire issued and outstanding capital of MQL held by Mr. Anthony Ng Zi Qin, consisting of 8,000,100 shares of stock issued at par value of SGD 1.00 per share, or $0.714 on the acquisition date.


28


On August 19, 2016, the Company and Anthony Ng Zi Qin entered into an Addendum (the “First MQL Addendum”) to the Purchase Agreement to extend the August 25, 2016 anniversary date for the adjustment of issued shares for an additional period of 12 months. On November 10, 2017, the Company and Anthony Ng Zi Qin signed an Addendum (the “Second MQL Addendum”) to the Purchase Agreement, as amended, pursuant to which the Company agreed to issue an aggregate of 3,339,900 shares of common stock, in satisfaction of the shortfall in the value of the shares issued. These shares were issued on December 12, 2017 in full satisfaction of the aforementioned contingent liability. The Purchase Agreement, as amended, is referred to herein as the “MQL Acquisition Agreement.”

 

The algorithms were placed into commercial operation in November 2015 upon the execution of a Software License Agreement (the “MQL License Agreement”) between and New Asia Momentum Limited (“NAML”), a company owned and controlled by NAHD’s Chairman and CEO, Dr. Lin Kok Peng. Under the terms of the MQL License Agreement, MQL agreed to license its proprietary trainable, trading algorithms to NAML in exchange for payment of a license fee and certain other fixed and time and materials fees. Pursuant to the terms of the MQL License Agreement, MQL licensed its proprietary trainable, trading algorithms. NAML, in turn, offered these proprietary, trainable, algorithm trading software solutions to broker-dealers, banks, funds and other clients on the basis of a SaaS licensing and delivery model, with sub-licensed users availing themselves of service-based contractual arrangements. NAML was required to pay MQL royalty fees equal to 20% of the trading profits achieved by the SaaS contract agreements that NAML executed with its clients. The targeted geographic market was Asia, with an initial emphasis on Singapore, Hong Kong, Indonesia, and Australia. From 2015 to 2017, NAML grew its retail assets under management (“AUM”) from zero to approximately $2.5 million.

 

In conjunction with the expansion into the regulated fund and bank model, NAML decided to ask its clients to redeem the AUM and as of September 30, 2017, trading on the AUM was terminated.

 

The Company initiated its focus on the regulated bank and fund model in 2017 with the launch of the Feuris Fund A with AUM of approximately $6.67 million. Because the risk profiles required by these regulated funds and banks reflect a lower level of risk, there was a significantly reduced frequency of trading activities. As of September 30, 2019, due to market conditions that impacted trading frequencies and volumes, NAML liquidated the Feuris Fund A and returned the AUM to the investors.  

 

The MQL License Agreement remains in place. While the Company continues to improve its algorithm products, there are no guarantees that such product improvements will translate to improved financial performance. The Company, in its efforts to expand its business, is currently involved in the development of new business opportunities, including the following:

 

Point of Sales (POS) and mobile Point of Sales (mPOS) solutions and technologies. The Company expects to develop its own mobile readers which would allow small- and medium-sized businesses to accept payments anytime and anywhere by swiping a debit or credit card. The Company aims to be a strong market leader in mPOS solutions.  

 

A global digital payment system that would allow users to gain access to the existing global merchant base in multiple countries and regions and earn attractive rewards and cashback benefits. We expect that access to the existing global merchant base would be established through proven payment merchant networks, such as UnionPay, and convertible to both mainstream currencies and other digital assets to ensure a steady stream of liquidity. We anticipate that users would be able to convert cryptocurrencies for spending at merchant outlets worldwide. 

 

In December 2019, a novel strain of coronavirus (COVID-19) emerged in Wuhan, Hubei Province, China. While initially the outbreak was largely concentrated in China and caused significant disruptions to its economy, it has now spread to several other countries and infections have been reported globally.

 

Because COVID-19 infections have been reported worldwide, certain national, state and local governmental authorities have issued stay-at-home orders, proclamations and/or directives aimed at minimizing the spread of COVID-19. Additional, more restrictive proclamations and/or directives may be issued in the future. As a result, certain Company internal operations communications and accounting operations have been disrupted by these “stay at home” orders, which have affected the timing of certain new business development activities (the Company had previously liquidated the Feuris Fund A AUM during the third quarter of 2019).

 

The ultimate impact of the COVID-19 pandemic on the Company’s operations is unknown and will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the COVID-19 outbreak, new information which may emerge concerning the severity of the COVID-19 pandemic, and any additional preventative and protective actions that governments, or the Company, may direct, which may result in an extended period of continued business disruption and reduced operations. Any resulting financial impact cannot


29


be reasonably estimated at this time but could be anticipated to have a material adverse impact on our business, financial condition and results of operations.

 

The measures taken to date will impact the Company’s business for the fiscal first and second quarters and potentially beyond. Management expects that all of its business segments, across all of its geographies, will be impacted to some degree, but the significance of the impact of the COVID-19 outbreak on the Company’s business and the duration for which it may have an impact cannot be determined at this time.

 

Results of Operations.

 

The following table provides selected financial data about us for the fiscal years ended December 31, 2019 and December 31, 2018. For detailed financial information, see the audited Financial Statements included in this annual report on Form 10-K.


30


 

 

 

 

December 31, 2019

 

December 31, 2018

ASSETS

 

 

 

 

Current Assets

 

 

 

 

 

 

 

 

Cash  

 

 

 

 

 

$         23,874

 

$         28,617

 

Prepaid Expense

 

 

 

 

 

                      11,000

 

                      13,225

Total Current Assets

 

 

 

 

 

                      34,874

 

                      41,842

Other Assets

 

 

 

 

 

 

 

 

Deposit

 

 

 

 

                           195

 

                          195

Total Other Assets

 

 

 

 

 

 

                           195

 

                          195

TOTAL ASSETS

 

 

 

 

                      35,069

 

                      42,037

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' DEFICIT

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Accounts Payable and Accrued Liabilities

 

 

 

 

 

                      91,858

 

                      43,699

 

 

 

 

 

 

 

                                

 

                                

 

Advance From Shareholder

 

 

 

 

 

                     836,452

 

                    711,539

Total Current Liabilities

 

 

 

 

 

                     928,310

 

                    755,238

 

 

 

 

 

 

 

 

 

 

Total Liabilities

 

 

 

 

                     928,310

 

                    755,238

 

 

 

 

 

 

 

 

 

 

Stockholders' Deficit

 

 

 

 

 

 

 

 

Preferred Stock, $0.001 par value, 30,000,000 shares authorized, 0 shares issued and outstanding

 

                             -   

 

                               -

 

Common Stock, $0.001 par value, 400,000,000 shares authorized, shares issued 72,288,667 and outstanding 72,288,667 at December 31, 2019 and December 31, 2018, respectively

 

                      72,289

 

                      72,289

 

 

 

 

 

 

 

 

 

 

 

                               -

 

Additional Paid In Capital

 

 

 

                11,182,713

 

               11,182,713

 

Accumulated Deficit

 

 

 

 

               (12,148,029)

 

              (11,968,027)

 

Accumulated Other Comprehensive Loss

 

 

                          (214)

 

                         (176)

Total Stockholders' Deficit

 

 

 

 

(893,241)

 

(713,201)

TOTAL LIABILITIES & STOCKHOLDERS' DEFICIT

 

 

$     35,069

 

$       42,037

 

 

 

 

 

 

 

 

 

 


31


During fiscal 2019, we generated no revenues compared to fiscal 2018 when we generated $76 in revenues. In addition, we have a history of losses. The reduction in fiscal 2019 revenues resulted from significantly reduced trading volumes of the Feuris Fund A activities since the risk profiles required by these regulated funds and banks reflects a lower level of risk, which resulted in significantly reduced frequency of trading activities over the last several quarters which then led to the closure of the Feuris Fund A by Momentum as of September 30, 2019 and the return of the $ 6.67 million AUM to clients. The Company continues to improve its products and, coupled the self-learning capabilities of the Algorithms the Company is doing its best to provide the basis for improved performance in the coming quarters, however, there is no guarantees that such product improvements will translate to improved financial performance and the Company has begun to focus on the development of new business and technology solutions that are expected to be announced during the second half of 2020.

 

As of December 31, 2019 and December 31, 2018, our accountants have expressed substantial doubt about our ability to continue as a going concern as a result of our history of net losses. Our ability to achieve and maintain profitability and positive cash flow is dependent upon our ability to successfully develop and market our software and our ability to generate revenues.

 

Operating expenses were $180,002 for the year ended December 31, 2019 and $145,824 for the year ended December 31, 2018 and consisted primarily of general and administrative expenses and professional fees. This compares with operating expenses for the year ended December 31, 2018 of $145,824, which primarily consisted of general and administrative expenses and professional fees. The nominal increase in such expenses in the year ended December 31, 2019 was related to increased professional fees and general and administrative expenses.

 

As a result of the foregoing, we had net loss of $ 180,002 for the year ended December 31, 2019. This compares with a net loss for the year ended December 31, 2018 of $145,748.

 

After the change in control in December 24, 2014, and the acquisition of our proprietary trainable trading algorithm assets in August 2015, the Company had been implementing its business model, as described above. We expect that we will need to raise additional funds to support the continued implementation and expansion of our business model (focused on the implementation of new business solutions as described above) including, working capital and for the acquisition of new businesses and technologies, or if we must respond to unanticipated events that require us to make additional investments. We cannot assure that additional financing will be available when needed on favorable terms, or at all.

 

We had begun to generate nominal revenues since the second quarter of 2016, however, due to the change in strategy to focus on the regulated bank and fund model, the Company’s licensee decided to terminate all activities with retail clients and the retail AUM was returned to retail clients. The focus on the regulated bank and fund model was initiated in 2017 with the launch of the Feuris Fund A with AUM of approximately $6.67 million. However, since the adoption of the regulated fund and bank models, the risk profiles required by these regulated funds and banks reflects a lower level of risk, which has resulted in significantly reduced frequency of trading activities over the last several quarters and the Company’s licensee, Momentum decided, as of September 30, 2019, to liquidate the Feuris Fund A and return the AUM to the investors.  The License Agreement between MQL and Momentum still remains in place. The Company continues to improve its products and, coupled the self-learning capabilities of the Algorithms the Company is doing its best to provide the basis for improved performance in the coming quarters, however, there is no guarantees that such product improvements will translate to improved financial performance. The Company is currently pursuing the development of new business opportunities, as described above, which are expected to begin to be implemented after the second half of 2020. We expect to incur operating losses through the balance of 2020 because we will be incurring expenses and not generating sufficient revenues. We cannot guarantee that we will be successful in generating sufficient revenues or other funds in the future to cover these operating costs. We expect to cover such shortfall in operating margins through advances from our principal shareholder and other fund-raising measures that the Company deems appropriate.

 

Liquidity and Capital Resources

 

As of December 31, 2019, we had cash of $23,874, compared to $28,617 at December 31, 2018.

 

We had net cash used in operating activities of $(129,618) for the year ended December 31, 2019 and $(107,822) of net cash used by operating activities for the year ended December 31, 2018.

 

We had net cash flows from financing activities of $124,913 resulting from advances from our principal shareholder during the year ended December 31, 2019, compared to of $78,989 cash flows from financing activities during the year ended December 31, 2018.

 

We had no cash flows from investing activities during the year ended December 31, 2019, compared to no cash flows from investing activities for the year ended December 31, 2018.


32


 

The Company's ultimate continued existence is dependent upon its ability to generate sufficient cash flows from operations to support its daily operations as well as provide sufficient resources to retire existing liabilities and obligations on a timely basis.

 

The Company's need for capital may change dramatically as a result of any business acquisition or combination transaction. There can be no assurance that the Company will identify any such business, product, technology or company suitable for acquisition in the future. Further, there can be no assurance that the Company would be successful in consummating any acquisition on favorable terms or that it will be able to profitably manage the business, product, technology or company it acquires.

 

The Company has no current plans, proposals, arrangements or understandings with respect to the sale or issuance of additional securities prior to the location of a merger or acquisition candidate. Accordingly, there can be no assurance that enough funds will be available to the Company to allow it to cover the expenses related to such activities.

 

The Company's Articles of Incorporation authorize the issuance of up to 30,000,000 shares of preferred stock and 400,000,000 shares of common stock. The Company's ability to issue preferred stock may limit the Company's ability to obtain debt or equity financing as well as impede potential takeover of the Company, which takeover may be in the best interest of stockholders. The Company's ability to issue these authorized but unissued securities may also negatively impact our ability to raise additional capital through the sale of our debt or equity securities.

 

The Company anticipates future sales of equity securities to facilitate either the consummation of a business combination transaction or to raise working capital to support and preserve the integrity of the corporate entity. However, there is no assurance that the Company will be able to obtain additional funding through the sales of additional equity securities or, that such funding, if available, will be obtained on terms favorable to or affordable by the Company.

 

It is the belief of management and significant stockholders that they will provide sufficient working capital necessary to support and preserve the integrity of the corporate entity. However, there is no legal obligation for either management or significant stockholders to provide additional future funding. Further, the Company is at the mercy of future economic trends and business operations for the Company's majority stockholder to have the resources available to support the Company. Should this pledge fail to provide financing, the Company has not identified any alternative sources.

 

If no additional operating capital is received during the next twelve months, the Company will be forced to rely on existing cash in the bank and upon additional funds loaned by management and/or significant stockholders to preserve the integrity of the corporate entity at this time. In the event, the Company is unable to acquire advances from management and/or significant stockholders, the Company's ongoing operations would be negatively impacted.

 

While the Company is of the opinion that good faith estimates of the Company's ability to secure additional capital in the future to reach our goals have been made, there is no guarantee that the Company will receive sufficient funding to sustain operations or implement any future business plan steps.

 

Further, the Company is at the mercy of future economic trends and business operations for the Company's majority stockholder to have the resources available to support the Company.

 

In such a restricted cash flow scenario, the Company would be unable to complete its business plan steps, and would, instead, delay all cash intensive activities. Without necessary cash flow, the Company may become dormant during the next twelve months, or until such time as necessary funds could be raised in the equity securities market.

Regardless of whether the Company's cash assets prove to be inadequate to meet the Company's operational needs, the Company might seek to compensate providers of services by issuances of stock in lieu of cash.

 

Off-Balance Sheet Arrangements

 

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

 


33


 

Future Financings

 

We will continue to rely on advances from our principal shareholder as well as from other sources of financing, including private placements of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund our operations and other activities.

 

Critical Accounting Policies

 

Our financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (GAAP). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenue and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.

 

Our significant accounting policies are summarized in Note 1 of our financial statements. While all these significant accounting policies impact our financial condition and results of operations, we view certain of these policies as critical. Policies determined to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater degree of judgment and estimates. Actual results may differ from those estimates. Our management believes that given current facts and circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause effect on our results of operations, financial position or liquidity for the periods presented in this report.

 

ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

Not Applicable.

 

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

 

The full text of our audited financial statements as of December 31, 2019 and 2018 begins on page F-1 of this annual report on Form 10-K.

 

ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

 

None.


34


 

ITEM 9A.

CONTROLS AND PROCEDURES.

 

Evaluation of Disclosure Controls and Procedures

 

Our management conducted an evaluation, with the participation of Mr. Lin Kok Peng, who is our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this annual report on Form 10-K. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that as a result of the material weakness in our internal control over financial reporting described below, our disclosure controls and procedures were not effective as of December 31, 2019.

 

Management’s Annual Report on Internal Control over Financial Reporting

 

Management is responsible for the preparation of our consolidated financial statements and related information. Management uses its best judgment to ensure that the consolidated financial statements present fairly, in material respects, our financial position and results of operations in conformity with generally accepted accounting principles.

 

Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in the Exchange Act. These internal controls are designed to provide reasonable assurance that the reported financial information is presented fairly, that disclosures are adequate and that the judgments inherent in the preparation of financial statements are reasonable. There are inherent limitations in the effectiveness of any system of internal controls including the possibility of human error and overriding of controls. Consequently, an ineffective internal control system can only provide reasonable, not absolute, assurance with respect to reporting financial information.

 

Our internal control over financial reporting includes policies and procedures that: (i) pertain to maintaining records that, in reasonable detail, accurately and fairly reflect our transactions; (ii) provide reasonable assurance that transactions are recorded as necessary for preparation of our financial statements in accordance with generally accepted accounting principles and that the receipts and expenditures of company assets are made in accordance with our management and directors authorization; and (iii) provide reasonable assurance regarding the prevention of or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on our financial statements.

 

Under the supervision of our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework Internal Control—Integrated Framework (2013) as outlined by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) and guidance prepared by the Commission specifically for smaller public companies. Based on that evaluation, our management concluded that our internal control over financial reporting was not effective as of December 31, 2019. We have identified the following material weaknesses as of December 31, 2019:

 

§Lack of sufficient written documentation of internal controls.  

§Lack of proper segregation of duties over financial transactions and processes  

 

Management conducted an evaluation of the effectiveness, as of December 31, 2019, of our internal control over financial reporting based on criteria established in Internal Control – Integrated Framework issued by COSO (2013 framework). Based on this evaluation, our Chief Executive and Chief Financial Officer concluded that, as of December 31, 2019, our disclosure controls and procedures were not effective due to the size and nature of the existing business operation. Given the size of our current operation and existing personnel, the opportunity to implement internal control procedures that segregate accounting duties and responsibilities are limited. Until the organization can increase in size to warrant an increase in personnel, formal internal control procedure will not be implemented until they can be effectively executed and monitored. As a result of the size of the current organization, there will not be significant levels of supervision, review, independent directors nor formal audit committee.

 

This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to an exemption for smaller reporting companies.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting during the fourth quarter of our fiscal year ended December 31, 2019, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


35


 

ITEM 9B.  OTHER INFORMATION

 

None.


36


PART III

 

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

 

Directors and Executive Officers

 

The following sets forth the name and position of each of our current executive officers and directors.

 

NAME

 

AGE

 

POSITION

Lin Kok Peng

 

 

47

 

Chief Executive Officer, Chief Financial Officer, Chairman of the Board, and Director

Allister Lim Wee Sing

 

46

 

Director

Jose A. Capote

 

59

 

Vice President and Secretary

 

Lin Kok Peng

 

Since 2005, Dr. Lin has been an entrepreneur and a managing director of several property investment and construction interior consultancy firms. He leads over 10 companies and has over 10 years of experience in property, construction and investments. Dr. Lin brings strategic focus, vision and excellent judgment to his companies. With more than 10 years of experience across a wide variety of industries, he is able to make a significant impact on the profitability and growth of his companies. Dr. Lin lead his first start up business (Free Space Intent) from a small construction interior consultancy firm to currently one of the largest construction interior consultancy firms in Singapore. Since 2014, Dr. Lin has served as Managing Director of Rock Capital Limited. Since 2012, he has served as Director of Goldin Shipping Pte Ltd and Managing Director of Klin Capital Resources Pte Ltd.

 

Dr. Lin holds a Master degree in Business Administration from De Lasalle University, and a Ph.D. from Camden University in Kuala Lumpur.

 

Dr. Lin has received the Entrepreneur of the Year Award (EYA), the oldest Award in Singapore that salutes and honors local entrepreneurs who have shown outstanding performance as business owners, be it emerging or established enterprises, in their chosen field of entrepreneurship, several times since 2010.

 

Allister Lim Wee Sing

 

Mr. Lim serves as a director of our Company. Since 2005, Mr. Lim has been the Principal Partner of the law firm of Allister Lim & Thrumurgan, Singapore. From 2004 to 2005, he was a Senior Associate Director with the law firm of PK Wong & Associates LLC, Singapore. From 2003 to 2004, he was a Legal Associate with the law firm of PK Wong & Advani, Singapore. From 1999 to 2003, Mr. Lim was a Legal Assistant with the law firm of Harry Elias Partnership, Singapore.

 

Mr. Lim graduated with a Bachelor of Laws (Honors) LL.B. (Hons) from The National University of Singapore in 1998, was admitted as an Advocate and Solicitor of the Supreme Court of The Republic of Singapore in 1999 and passed the New York Bar Examinations in 2001.

 

Jose A. Capote

 

Mr. Capote has 30 years of experience in project engineering, project development, and business development within the energy and environmental management, waste to energy, renewable/alternative energy, nuclear energy, and industrial/infrastructure markets.

 

Since 2001, Mr. Capote has been responsible for the implementation and management of large-scale waste to energy projects in Southeast Asia (Malaysia, Thailand), including MSW waste to energy, medical waste to energy, palm oil waste to energy and natural fibers. In 2001, he was the founding member of PEAT International Inc, a company specializing in the development and deployment of thermal plasma technology for the conversion of a wide range of industrial, municipal and hazardous wastes into useful resources and energy. in this company, he led technology transfer efforts with local specialty contractors in India and Taiwan and led the implementation of several waste to energy projects in India and Taiwan. From 1994 through approximately 2000, Mr. Capote was Senior Vice President for IDM Environmental Inc, a mid-sized U.S. public company, where he led in the development of the company’s business in the areas of hazardous and nuclear contaminated facility cleanups and decommissioning (including establishing as a leading provider of hands-on remediation/decommissioning services to the U.S. Department Of Energy and plant relocation services. Previously, Mr. Capote held several senior positions at Burns and Roe Inc, a large, multi-national, engineering and construction firm specializing in the design and construction of nuclear, conventional and waste to energy power plants. Mr. Capote received Engineering Science Degrees in Nuclear and Mechanical Engineering from Columbia University.


37


 

Directors are elected until their successors are duly elected and qualified.

 

During 2019, no salary, consulting fee, finder's fee or other compensation was paid to any of the Company's directors or executive officers, or to any other affiliate of the Company, except as described under Executive Compensation below. It is not anticipated that any director will receive compensation for his or her services as a director in the near future.

 

Involvement on Certain Material Legal Proceedings During the Past Five Years

 

No director, officer, significant employee or consultant has been convicted in a criminal proceeding, exclusive of traffic violations or is subject to any pending criminal proceeding. No bankruptcy petitions have been filed by or against any business or property of any director, officer, significant employee or consultant of the Company nor has any bankruptcy petition been filed against a partnership or business association where these persons were general partners or executive officers. No director, officer, significant employee or consultant has been permanently or temporarily enjoined, barred, suspended or otherwise limited from involvement in any type of business, securities or banking activities. No director, officer or significant employee has been convicted of violating a federal or state securities or commodities law.

 

Independent Directors; Committees of our Board of Directors

 

Our securities are not quoted or listed on an exchange that requires that a majority of our Board members be independent and we are not currently otherwise subject to any law, rule or regulation requiring that all or any portion of our Board of Directors include "independent" directors, nor are we required to establish or maintain an Audit Committee or other committee of our Board of Directors.

 

We have not established any committees, including an Audit Committee, a Compensation Committee or a Nominating Committee, any committee performing a similar function.

 

The functions of those committees are being undertaken by Board of Directors as a whole. Because we have only two directors, none of whom are independent, we believe that the establishment of these committees would be more form over substance.

 

We do not have a policy regarding the consideration of any director candidates which may be recommended by our stockholders, including the minimum qualifications for director candidates, nor has our Board of Directors established a process for identifying and evaluating director nominees. We have not adopted a policy regarding the handling of any potential recommendation of director candidates by our stockholders, including the procedures to be followed. Our Board has not considered or adopted any of these policies as we have never received a recommendation from any stockholder for any candidate to serve on our Board of Directors. Given our relative size and lack of directors and officers insurance coverage, we do not anticipate that any of our stockholders will make such a recommendation in the near future. While there have been no nominations of additional directors proposed, in the event such a proposal is made, all members of our Board will participate in the consideration of director nominees. In considering a director nominee, it is likely that our Board will consider the professional and/or educational background of any nominee with a view towards how this person might bring a different viewpoint or experience to our Board.

 

None of our directors is an "audit committee financial expert" within the meaning of Item 401(e) of Regulation S-K. In general, an "audit committee financial expert" is an individual member of the audit committee or Board of Directors who:

 

understands generally U.S. GAAP and financial statements,  

is able to assess the general application of such principles in connection with accounting for estimates, accruals and reserves,  

has experience preparing, auditing, analyzing or evaluating financial statements comparable to the breadth and complexity to our financial statements,  

understands internal controls over financial reporting, and  

understands audit committee functions.  

 

Communications with the Board

 

Individuals may communicate with the Company's Board of Directors or individual directors by writing to the Company's Secretary at 11 Beach Road #06-01, Singapore 189675. The Secretary will review all such correspondence and forward to the Board of Directors a summary of all such correspondence and copies of all correspondence that, in the opinion of the Secretary, relates to the functions of the Board or committees thereof or that he otherwise determines requires their attention. Directors may review a log of all such correspondence received by the Company and request


38


copies. Concerns relating to accounting, internal control over financial reporting or auditing matters will be immediately brought to the attention of the Board of Directors and handled in accordance with its procedures established with respect to such matters.

 

Director Compensation

 

In 2019, we only had one non-employee director: Mr. Lim. No director, including Mr. Lim, received any compensation for his services as a director.

 

Code of Ethics

 

The Company's Board of Directors has adopted a Code of Ethics which applies to its principal executive officer and principal financial officer. A copy of the Code of Ethics is available in print without charge to any person who sends a request to the office of the Secretary of the Company at 11 Beach Road #06-01, Singapore 189675.

 


39


 

 

ITEM 11.

EXECUTIVE COMPENSATION

 

Since the change in control in 2014, management of the Company requires approximately four (4) hours per calendar week. Accordingly, no officer or director has received any compensation from the Company, except for Mr. Capote who received $18,000 in each of the years ended December 31, 2019 and 2018. Until the Company secures additional SaaS contracts, implements expected new business solutions as described above, and begins to accrue revenues, it is not anticipated that any officer, other than Mr. Capote, or any director will receive compensation from the Company other than reimbursement for out-of-pocket expenses incurred on behalf of the Company. See Certain Relationships and Related Transactions.

 

The Company has no stock option, retirement, pension, or profit-sharing programs for the benefit of directors, officers or other employees, but the Board of Directors may recommend adoption of one or more such programs in the future.

 

2019 SUMMARY COMPENSATION TABLE

Name &

Principal Position

 

Year

Salary
($)

 

Bonus
($)

 

Stock
Awards
($)

 

Option
Awards
($)

 

Non-Equity
Incentive
Plan
Compensation
($)

 

Change in
Pension Value and Nonqualified
Deferred Compensation Earnings
($)

 

All Other
Compensation
($)

 

Total
($)

 

Lin Kok Peng,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Chief Executive Officer and Chief Financial Officer

 

2019

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

 

 

 

2018

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

 

Jose A. Capote

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vice President and Secretary

 

2019

18,000

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

18,000

 

 

 

2018

18,000

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

-0-

$

18,000

 

 

The Company has no other Executive Compensation issues which would require the inclusion of other mandated table disclosures.

 

ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

 

Security Ownership of Certain Beneficial Owners and Management

 

The following table sets forth, as of April 17, 2020, the number of shares of Common Stock owned of record and beneficially by executive officers, directors and persons who hold 5% or more of the outstanding Common Stock of the Company. Also included are the shares held by all executive officers and directors as a group.

 

 

Name and Address of Beneficial Owner

 

Amount and Nature of Beneficial Ownership (1)

 

Percent of Class (2)

Named Executive Officers and Directors:

 

 

 

 

Lin Kok Peng (3)

 

54,957,724

 

76.0%

Jose A. Capote (4)

 

1,518,169

 

2.1%

Allister Lim Wee Sing

 

--

 

0.0%

All officers and directors as a group (3 persons)

 

56,475,893

 

78.1%

 

 

 

 

 

5% Stockholders:

 

 

 

 

New Asia Holdings Ltd (5)

 

54,957,724

 

76.0%

Anthony Ng Zi Qin

 

10,716,900

 

14.9%

 

* Less than 1%

 


40


(1)

On April 17, 2020, there were 72,288,667 shares of our common stock outstanding and no shares of Preferred Stock issued and outstanding. In determining the percent of common stock owned by a person on April 17, 2020: (a) the numerator is the number of shares of common stock beneficially owned by the person, including shares the beneficial ownership of which may be acquired within 60 days upon the exercise of options or warrants or conversion of convertible securities, and (b) the denominator is the total of (i) the 72,288,667 shares of common stock outstanding on April 17, 2020, and (ii) any shares of common stock which the person has the right to acquire within 60 days upon the exercise of options or warrants or conversion of convertible securities. Neither the numerator nor the denominator includes shares which may be issued upon the exercise of any other options or warrants or the conversion of any other convertible securities. As of April 17, 2020, we have no outstanding stock warrants or outstanding stock options.

(2)

Under applicable SEC rules, a person is deemed the "beneficial owner" of a security with regard to which the person directly or indirectly, has or shares (a) the voting power, which includes the power to vote or direct the voting of the security, or (b) the investment power, which includes the power to dispose, or direct the disposition, of the security, in each case irrespective of the person's economic interest in the security. Under SEC rules, a person is deemed to beneficially own securities which the person has the right to acquire within 60 days through the exercise of any option or warrant or through the conversion of another security.

(3)

These shares are held by New Asia Holdings Ltd. Lin Kok Peng owns New Asia Holdings Ltd and accordingly, has voting and dispositive power over such shares.

(4)

Jose A. Capote owns these shares through his 50% ownership of Earth Heat, Ltd. Mr. Capote has voting and dispositive power over such shares.

(5)

New Asia Holdings Ltd is owned by Lin Kok Peng, the Company’s Chief Executive Officer, Chief Financial Officer and Chairman of the Board.

 

ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

 

The Board has written policies and procedures for the review, approval or ratification of any transactions between the Company and any related persons that are required to be disclosed pursuant to Item 404 of Regulation S-K, and reviews and approves all such transactions. “Related person” and “transaction” shall have the meanings given to such terms in Item 404 of Regulation S-K, as amended from time to time. No director will participate in any discussion or approval of such a transaction for which he or she is a related party, except that the director shall provide all material information concerning the transaction to the Board. In determining whether to approve or ratify a particular transaction, the Board will review all material facts of such transactions.

 

The Company pays Mr. Capote, the Company’s Secretary and Vice President, consulting fees for acting in such capacities. The Company incurred such expenses in the amount of $18,000 and $18,000 for the years ended December 31, 2019 and December 31, 2018, respectively.

 

The Company pays Momentum, a Singapore private company owned and controlled by Dr. Lin Kok Peng, Chairman and CEO of the Company, fees for the rental of office space and for administrative services in its Singapore headquarters. The Company incurred such expense in the amount of $58,271 and $35,513 for the years ended December 31, 2019 and 2018, respectively.

 

In November 2015, MQL entered into a Software License Agreement with NAML, a company owned and controlled by NAHD's Chairman and CEO, Dr. Lin Kok Peng. In consideration of MQL's performance, NAML agreed to pay MQL in accordance with the following provisions:

 

(i)License and Other Fixed Price Fees as set forth below: 

 

License fees shall be based on profits from the end users' accounts. The license fee shall be calculated as follows: - 

 

oWhere the AUM from all end users is less than $10 million, 15% only of the profits from the end users' accounts. 

oIf the AUM from all end users exceed $10 million, MQL's fees shall be separately agreed on between MQL and client, and if MQL and the client are unable to agree on such apportionment, MQL shall still be entitled to 15% only of the profits from the end users' accounts; 

oOn every anniversary date of the Software License Agreement, parties will review the performance of the licensed software and may by mutual agreement between MQL and the client vary the license fee.  

 

(ii)Time & Material Fees: The charges for performance of any T&M tasks due to work orders will be billed monthly for charges incurred in the previous monthly period and are due and payable within  


41


30 days of the date of the invoice. Expenses may include, but are not limited to, reasonable charges for materials, office and travel expenses, graphics, documentation, research materials, computer laboratory and data processing, and out-of-pocket expenses reasonably required for performance. Expenses for travel and travel-related expenses and individual expenses in excess of $500 require the prior approval of client.

 

MQL had an accounts receivable balance with NAML of $0, and $0 as of December 31, 2019 and 2018, respectively.

 

Pursuant to the MQL Agreement, and the First MQL Addendum, relating to the Company's acquisition of issued and outstanding shares of MQL in exchange for new restricted shares of common stock of the Company, if the average trading price of the Company's shares based on the 7 days closing price over the period immediately before the second anniversary date (August 25, 2017) of this Agreement and the 7th day falling on the first anniversary date of the agreement is below $1.00, the Company shall issue additional shares to Anthony Ng Zi Qin to make up the difference between the value of the Consideration Shares based on such 7 days closing history and the sum of SGD 10,000,000. The difference between the fair value of the assets acquired and the value of the shares swapped ($4,099,837) as well as the negative change in the common stock share price ($2,894,580) for the year ended December 31, 2016 created a contingent liability in amount of $6,994,417 as of December 31, 2016. The negative change in common share price occurred because the stock price decreased as of December 31, 2016. The Company recorded a loss in change in fair value of $1,335,960 for the year ended December 31, 2016.

 

On November 10, 2017, the Company and Anthony Ng Zi Qin entered into the Second MQL Addendum, pursuant to which the parties agreed that the Company would issue an aggregate of 3,339,900 shares in satisfaction of the shortfall in the value of the shares issued pursuant to the MQL Agreement, as amended. On December 12, 2017, the common stocks restricted shares were issued. As a result of this transaction, Anthony Ng Qin became a 14.89% shareholder. Thereby he is deemed a related party with significant influence. Also, this transaction created a cancellation of contingency of $5,158,387 that was recorded as a capital transaction for the year ended December 31, 2017. On December 12, 2017, there was positive change in the common share price occurred because of the stock price increase as of December 12, 2017. The Company recorded a gain in change of fair value $1,220,919.

 

The Company has two directors, including Lin Kok Peng, who is the Chief Executive Officer and controlling shareholder of the Company, and Allister Lim Wee Sing. Mr. Lim is the only director that qualifies as an independent director, as defined in Rule 5605(a)(2) of the NASDAQ Listing Rules.

 

ITEM 14.

PRINCIPAL ACCOUNTING FEES AND SERVICES.

 

Independent Registered Public Accounting Firm's Fees

 

Aggregate fees for professional services rendered for the Company by MaloneBailey, LLP, the Company’s independent registered public accounting firm, for the fiscal years ended December 31, 2019 and 2018 were as follows:

 

 

 

December 31, 2019

 

 

December 31, 2018

 

Audit Fees

 

$

22,500

 

 

$

22,500

 

Audit Related Fees

 

 

-

 

 

 

-

 

Tax Fees

 

 

-

 

 

 

-

 

All Other Fees

 

 

-

 

 

 

-

 

TOTAL

 

$

22,500

 

 

$

22,500

 

 

Audit Fees. Audit fees consisted of the fees billed for professional services rendered for the audit of our annual financial statements and the reviews of the financial statements included in our Quarterly Reports on Form 10-Q.

 

Audit-related Fees. During the 2019 and 2018 fiscal years, our independent registered public accountants did not provide any assurance and related services that are reasonably related to the performance of the audit or review of our financial statements that are not reported under the caption “Audit Fees” above. Therefore, there were no audit-related fees billed or paid during the 2019 and 2018 fiscal years.

 

Tax Fees. Tax fees consists of fees billed for professional services rendered for tax compliance, tax advice and tax planning. Included in such tax fees were fees for preparation of our tax returns and consultancy and advice on other tax planning matters. As our independent registered public accountants did not provide any services to us for tax compliance, tax advice and tax planning during the fiscal years ended December 31, 2019 and 2018, no tax fees were billed or paid during those fiscal years.

 

All Other Fees. Our independent registered public accountants did not provide any products and services not disclosed in the table above during the 2019 and 2018 fiscal years. As a result, there were no other fees billed or paid during those fiscal years.


42


 

Audit Committee Pre-approval Policies and Procedures

 

The Company has not designated a formal audit committee. However, the entire Board of Directors, in the absence of a formally appointed audit committee, acts as the Company's audit committee. Our Board of Directors has considered whether the provision of any non-audit services is compatible with maintaining auditor independence and determined that such services are appropriate. Before auditors are engaged to provide us audit or non-audit services, such engagement is approved by Board of Directors.

 

The Company's principal accountant did not engage any other persons or firms other than the principal accountant's full-time, permanent employees.


43


PART IV

 

ITEM 15.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

 

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

 

1.Financial statements  

 

See index to financial statements and supporting schedules on page F-1 of this Annual Report on Form 10-K.

 

2.Financial statement schedules  

 

Financial statement schedules have been omitted since they are either not required, not applicable, or the information is otherwise included.

 

3.Exhibits  

 

The following exhibits are filed as part of this Annual Report on Form 10-K or are incorporated by reference:

 

Exhibit No.

 

Description

2.1

 

Sale and Purchase Agreement in Respect to the entire issued and paid up share capital of MAGDALLEN QUANT PTE LTD (1).

2.2

 

Addendum to Magdallen Quant Pte Ltd Share and Purchase Agreement, dated August 19, 2016 between New Asia Holdings, Inc. and Anthony Ng Zi Qin (2).

2.3

 

Addendum to Magdallen Quant Pte Ltd Share and Purchase Agreement, dated November 10th, 2017 between New Asia Holdings Inc and Anthony Ng Zi Qin (3)

3.1

 

Articles of Incorporation (4)

3.2

 

Certificate of Amendment (4)

3.3

 

Certificate of Amendment (5)

3.4

 

Certificate of Designation, Series "A" Preferred Stock (6)

3.5

 

Certificate of Amendment (6)

3.6

 

Bylaws (3)

21.1*

 

List of Subsidiaries

31.1*

 

Certifications of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2*

 

Certifications of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1*

 

Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

 

 

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 Extension Presentation Linkbase Document

_____________

(1) Incorporated by reference to Exhibit 2.1 to the registrant’s current report on Form 8-K filed with the Securities and Exchange Commission on September 1, 2015.

(2) Incorporated by reference to Exhibit 10.1 to the registrant’s quarterly report on Form 10-Q filed with the Securities and Exchange Commission on November 21, 2016.

(2) Incorporated by reference to Exhibit 10.1 to the registrant’s quarterly report on Form 10-Q filed with the Securities and Exchange Commission on November 20, 2017.

(3) Incorporated by reference to the relevant exhibit to the Registration Statement on Form S-1 filed with the Securities and Exchange Commission on April 8, 2010.

(4) Incorporated by reference to the relevant exhibit to Form 8-K filed with the Securities and Exchange Commission on December 14, 2011.

(5) Incorporated by reference to the relevant exhibit to Form 8-K filed with the Securities and Exchange Commission on December 14, 2011.

(6) Incorporated by reference to the relevant exhibit to Form 8-K filed with the Securities and Exchange Commission on February 17, 2015.

 


44


* Filed herewith.

 

(b) The exhibits filed with this Annual Report on Form 10-K are listed under Item 15(a)(3), immediately above.

 

(c) None.

 

ITEM 16. FORM 10-K SUMMARY

 

None.


45


SIGNATURES

 

In accordance with section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date: April 17, 2020

 

New Asia Holdings, Inc.

 

 

 

 

By:

/s/ Lin Kok Peng

 

 

Lin Kok Peng

 

 

Chief Executive Officer and Chief Financial Officer

 

In accordance with the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

 

 

 

 

Signature

 

Title

Date

/s/ Lin Kok Peng

 

Chief Executive Officer, Chief Financial Officer, Chairman of the Board and Director (principal executive officer, principal financial officer and principal accounting officer)

April 17, 2020

Lin Kok Peng

 

 

 

 

 

 

 

/s/ Allister Lim Wee Sing

 

Director

April 17, 2020

Allister Lim Wee Sing

 

 

 

 

 


46


NEW ASIA HOLDINGS, INC.

 

Contents

 

Page

 

 

 

Report of Registered Independent Certified Public Accounting Firm

 

F-2

 

 

 

Consolidated Financial Statements

 

 

Consolidated Balance Sheets as of December 31, 2019 and 2018

 

F-3

Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2019 and 2018

 

F-4

 

 

 

Consolidated Statements of Changes in Stockholders' Deficit for the years ended December 31, 2019 and 2018

 

F-5

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

 

F-6

Notes to Consolidated Financial Statements

 

F-7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

F-1


 


 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

To the Shareholders and Board of Directors of

New Asia Holdings, Inc.

 

Opinion on the Financial Statements

 

We have audited the accompanying consolidated balance sheets of New Asia Holdings, Inc, and its subsidiary (collectively, the “Company”) as of December 31, 2019 and 2018, and the related consolidated statements of operations and comprehensive loss, changes in stockholders’ deficit, and cash flows for the years then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

 

Going Concern Matter

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Basis for Opinion

 

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s 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 audit to obtain reasonable assurance about whether the 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 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 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 financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

/s/ MaloneBailey, LLP

www.malonebailey.com

We have served as the Company's auditor since 2016.

Houston, Texas

April 17, 2020

 

 

 

 

 

 

 

 

F-2


 


NEW ASIA HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

 

 

December 31, 2019

 

December 31, 2018

ASSETS

 

 

 

 

Current Assets

 

 

 

 

 

 

 

 

Cash  

 

 

 

 

                      23,874

$

                      28,617

 

Prepaid Expense

 

 

 

 

 

                      11,000

 

                      13,225

Total Current Assets

 

 

 

 

 

                      34,874

 

                      41,842

Other Assets

 

 

 

 

 

 

 

 

Deposit

 

 

 

 

                           195

 

                          195

Total Other Assets

 

 

 

 

 

 

                           195

 

                          195

TOTAL ASSETS

 

 

 

 

                      35,069

 

                      42,037

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' DEFICIT

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Accounts Payable and Accrued Liabilities

 

 

 

 

                      91,858

$

                      43,699

 

Advance From Shareholder

 

 

 

 

 

                     836,452

 

                    711,539

Total Current Liabilities

 

 

 

 

 

                     928,310

 

                    755,238

Total Liabilities

 

 

 

 

                     928,310

 

                    755,238

 

 

 

 

 

 

 

 

 

 

Stockholders' Deficit

 

 

 

 

 

 

 

 

Preferred Stock, $0.001 par value, 30,000,000 shares authorized, 0 shares issued and outstanding

 

                             -   

 

                               -

 

Common Stock, $0.001 par value, 400,000,000 shares authorized, 72,288,667 shares issued and outstanding at December 31, 2019 and December 31, 2018, respectively

 

                      72,289

 

                      72,289

 

Additional Paid In Capital

 

 

 

                11,182,713

 

               11,182,713

 

Accumulated Deficit

 

 

 

 

               (12,148,029)

 

              (11,968,027)

 

Accumulated Other Comprehensive Loss

 

 

                          (214)

 

                         (176)

Total Stockholders' Deficit

 

 

 

 

(893,241)

 

(713,201)

TOTAL LIABILITIES & STOCKHOLDERS' DEFICIT

 

                      35,069

$

                      42,037

 

The accompanying notes are an integral part of these consolidated financial statements. 

F-3


 


NEW ASIA HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

 

 

 

 

 

 

For the Year Ended

For the Year Ended

 

 

 

 

December 31, 2019

December 31, 2018

Revenues

 

 

 

 

 

 

Sales from related party

 

 

$                   -                                           

$               76

Total revenues

 

 

                                           -   

                                   76

Operating expenses

 

 

 

 

 

Professional Fees

 

 

58,664

46,897

 

Outside Service

 

 

33,601

33,600

 

General & Administrative Expenses

 

 

87,737

65,327

 

 

 

 

 

 

 

Total operating expenses

 

 

                               180,002

145,824

 

 

 

 

 

 

 

Loss from operations

 

 

                            (180,002)

(145,748)

 

 

 

 

 

 

 

Loss before income taxes

 

 

                            (180,002)

                        (145,748)

 

 

 

 

 

 

 

Provision for income taxes

 

 

                                           -   

                                      -   

 

 

 

 

 

 

 

Net Loss

 

 

(180,002)

(145,748)

 

 

 

 

 

 

 

Foreign currency translation loss

 

 

                                     (38)

                               (813)

Total comprehensive loss

 

 

                            (180,040)

                        (146,561)

Net loss per common share-basic and fully diluted

 

$                                 (0.00)

$                             (0.00)

 

 

 

 

 

 

 

Weighted average common shares outstanding-basic and diluted

 

                         72,288,667

                    72,288,667

The accompanying notes are an integral part of these consolidated financial statements.

 

F-4


 


NEW ASIA HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

FOR YEARS ENDED DECEMBER 31, 2019 AND 2018

 

 

 

 

Common Stock

 

 

 

 

 

Shares

Amount

Additional Paid In Capital

Accumulated

Deficit

Accumulated Other Comprehensive Income

Total

Balance, December 31, 2017

72,288,667

$    72,289

$ 11,182,713

$   (11,822,279)

$               637

$      (566,640)

Foreign Currency Translation Adjustment

 

 

 

 

           (813)

         (813)

Net loss for the year ended December 31, 2018

 

 

 

     (145,748)

 

    (145,748)

Balance, December 31, 2018

  72,288,667

  72,289

11,182,713

  (11,968,027)

       (176)

    (713,201)

Foreign Currency Translation Adjustment

 

 

 

 

       (38)

        (38)

Net loss for the year ended December 31, 2019

 

 

 

    (180,002)

 

    (180,002)

Balance, December 31, 2019

  72,288,667

$     72,289

$ 11,182,713

$  (12,148,029)

$            (214)

$      (893,241)

 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

F-5


 


NEW ASIA HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

 

 

For the Year Ended

For the Year Ended

 

 

 

December 31, 2019

December 31, 2018

Cash flows from operating activities

 

 

 

Net Loss

 

$          (180,002)

$           (145,748)

Changes in operating assets and liabilities:

 

 

 

 

Prepaid expenses

 

             2,225

                   (1,146)

 

Deposit

 

-

                       920

 

Accounts payable and Accrued expenses

 

                  48,159

                   38,152

 

Net cash used in operating activities

 

         (129,618)

             (107,822)

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Advances from Shareholder

 

       124,913

          78,989

 

 

 

 

 

 

Net cash provided by financing activities

 

124,913

                      78,989

Effect of exchange rate on cash

 

                (38)

                      (813)

Net decrease in cash

 

        (4,743)

                  (29,646)

 

 

 

 

 

 

Cash at beginning of year

 

               28,617

                     58,263

Cash at end of year

 

$             23,874

$          28,617

 

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

Interest paid

 

$                                   -

$                                   -

 

Taxes paid

 

$               800

$               800

 

 

 

 

 

 

 

 

 

 

 

 

F-6

The accompanying notes are an integral part of these consolidated financial statements.


 


NEW ASIA HOLDINGS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the years ended December 31, 2019 and 2018

 

Note 1: Organization and Summary of Significant Accounting Policies

 

Organization

 

New Asia Holdings, Inc. (previously known as DM Products, Inc., Midwest E.S.W.T. Corp, and Effective Sport Nutrition Corporation) (the “Company,” “we” or “our”) was incorporated in the State of Nevada on March 1, 2001. In December 2014, the Company underwent a change in control as a result of approximately 90% of the issued and outstanding shares of common stock of the Company being acquired by New Asia Holdings, Ltd. (wholly owned by Lin Kok Peng, Ph.D., the Company’s Chief Executive Officer, Chief Financial Officer and Chairman of the Board) (“NAHL”).

 

We offer trading software solutions to clients on the basis of a “Software as a Service (SaaS)” licensing and delivery model with licensed users availing themselves of service-based contractual arrangements. In addition, and consistent with the requirements of the United States federal securities laws, we may utilize our in-house proprietary neural trading models to trade our own funds, thus providing added value to our shareholders.

 

Algorithms were placed into commercial operation in November 2015 upon the execution of a Software Licensing Agreement for the deployment of the proprietary trainable, trading algorithms of Magdallan Quant Pte. Ltd. (“MQL”) with New Asia Momentum Limited (“NAML”), a company owned and controlled by NAHD’s Chairman and CEO, Dr. Lin Kok Peng. Under the terms of the Software License Agreement, NAML agreed to pay MQL a license fee and certain other fixed and time and materials fees. In 2019, Momentum assets under management (“AUM”) were returned to its investors by NAML. The license agreement between MQL and NAML still remains in place.

 

As a result of poor performance by the Company’s Algorithms, over the last several months the Company has been focusing on developing new business opportunities, including exploring potential new acquisition. The Company expects to announce the implementation of these new business activities within the second and third Quarter 2020.

 

The accompanying audited financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”).

 

Basis of Presentation

 

The Company’s consolidated financial statements are expressed in U.S. Dollars and are presented in accordance with U.S. GAAP and the rules and regulations of the Securities and Exchange Commission (“SEC”). The Company’s fiscal year end is December 31.

 

Principles of Consolidation

 

The consolidated financial statements as of December 31, 2019 and 2018, and for the years then ended, include the accounts of its wholly owned subsidiary, Magdallen Quant Pte Ltd. All significant intercompany transactions have been eliminated.

 

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 revenue and expenses during the reporting period. Actual results could differ from those estimates.

F-7


 


 

 

 

Foreign Currency

 

The functional currency of our foreign subsidiary is their respective local currency. The financial statements of the foreign subsidiary are translated into U.S. dollars for consolidation as follows: assets and liabilities at the exchange rate as of the balance sheet date, stockholders’ equity at the historical rates of exchange and income and expense amounts at average rates prevailing throughout the period. Translation adjustments resulting from the translation of the subsidiary’ accounts are included in “Accumulated other comprehensive loss,” a separate component of stockholders’ equity. The applicable exchange rate on December 31, 2019 closed at $1 = 1.3460 SGD and December 31, 2018 closed at $1 = 1.3629 SGD.

Cash

 

All highly liquid investments with maturities of three months or less are considered to be cash equivalents. At December 31, 2019 and December 31, 2018, the Company had no cash equivalents.

 

Fair Value of Financial Instruments

 

The Company’s financial instruments consist of cash, prepaid expense, accounts payable and accrued liabilities, and advances from shareholder. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates, unless otherwise disclosed in these financial statements.

 

Income Taxes

 

Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax, assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized. It is the Company’s policy to classify interest and penalties on income taxes as interest expense or penalties expense. As of December 31, 2019 and 2018, there have been no interest or penalties incurred on income taxes.

 

Basic Income (Loss) Per Share

 

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of December 31, 2019 and 2018.

F-8


 


 

Related Parties

 

The Company follows ASC 850, “Related Party Disclosures,” for the identification of related parties and disclosure of related party transactions. See note 5.

 

Recent Accounting Pronouncements

 

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” Under ASU 2016-02, Lessees will be required to recognize all leases (with the exception of short-term leases) at the commencement date including a lease liability, which the lessee’s obligation to make lease payments, arising from a lease, measured on a discounted basis; and a right-of-use (ROU) asset, which is an asset that represent the lessee’s right to sue, or control the use of, a specified asset for the lease term. Leases with a term of twelve months or less will be accounted for similar to existing guidance for operating leases. In December 2017, January 2018, July 2018, December 2018 and March 2019, the FASB issued ASU 2017-13, ASU 2018-10 & 11, ASU 2018-20 and ASU 2019-01, respectively, which contain modifications and improvements to ASU 2016-02. The amendments provide entities with an additional (and optional) transition method adjustment to the opening balance of retained earnings in the period of adoption.

 

On January 1, 2019, the Company adopted ASC topic 842, using the modified retrospective approach and elected to utilize the Optional Transition Method. The adoption did not impact the Company’s previously reported financial statements nor did it result in a cumulative adjustment to retained earnings as of January 1, 2019.

 

Note 2: Going Concern

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has sustained substantial losses, has a working capital deficit, and is in need of additional capital to grow its operations so that it can become profitable. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

 

In view of these matters, the ability of the Company to continue as a going concern is dependent upon growth of revenues and the ability of the Company to raise additional capital. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Note 3: Income Taxes

 

As of December 31, 2019, the Company had net operating loss carry forwards of approximately $12.1 million that may be available to reduce future years' taxable income. Future tax benefits, which may arise because of these losses, have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.

 

The 2017 Act reduces the corporate tax rate from 35% to 21% for tax years beginning after December 31, 2017. For net operating losses (NOLs) arising after December 31, 2017, the 2017 Act limits a taxpayer’s ability to utilize NOL carryforwards to 80% of taxable income. In addition, NOLs arising after 2017 can be carried forward indefinitely, but carryback is generally prohibited. NOLs generated in tax years beginning before January 1, 2018 will not be subject to the taxable income limitation. The 2017 Act would generally eliminate the carryback of all NOLs arising in a tax year ending after 2017 and instead would permit all such NOLs to be carried forward indefinitely.

 

The provision for federal income tax consists of the following for the twelve months ended:

 

December 31, 2019

 

 

December 31, 2018

 

Federal income tax benefit attributable to:

 

 

 

 

 

 

Current operations

 

$

37,800

 

 

$

30,607

 

Less: valuation allowance

 

 

(37,800)

 

 

 

(30,607)

 

Net provision for Federal income taxes

 

$

-

 

 

$

-

 

 

The cumulative tax effect at the expected rate of 21% of significant items comprising our net deferred tax amount is as follows:

 

December 31, 2019

 

 

December 31, 2018

 

Deferred tax asset attributable to:

 

 

 

 

 

 

Net operating loss carryover

 

$

2,526,927

 

 

$

2,489,127

 


 


Less: valuation allowance

 

 

(2,526,927)

 

 

 

(2,489,127

)

Net deferred tax asset

 

$

-

 

 

$

-

 

F-9


 


NEW ASIA HOLDINGS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the years ended December 31, 2019 and 2018

 

 

Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of $12.1 million for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, the net operating loss carry forwards may be limited to use in future years.

 

As of December 31, 2019, in accordance with the IRS Assessment Statute of Limitations, the IRS has the ability to audit or assess the Company’s tax returns on the basis of the following schedule:

 

Year

End of IRS Assessment Statute of Limitations

2016

Oct 15, 2020

2017

Oct 15, 2021

2018

Oct 15, 2022

2019 (to be filed in September 15th, 2020)

Oct 15, 2023

 

Note 4: Common Stock

 

The Company has authorized 430,000,000 shares of capital stock, consisting of 400,000,000 shares of $0.001 par value common stock, and 30,000,000 shares of $0.001 par value preferred stock. The Company had 72,288,667 shares of common stock and no shares of preferred stock issued and outstanding as of December 31, 2019 and December 31, 2018.

 

As of December 31, 2019, and 2018, NAHL, the Company’s principal shareholder, had not yet acted to exercise its option to convert advances from NAHL to shares of common stock. Accordingly, as of December 31, 2019 and 2018, the advances remain as an interest-free loan to the Company.

F-10


 


 

NEW ASIA HOLDINGS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the years ended December 31, 2019 and 2018

 

Note 5: Convertible Advances from Shareholder and other Related Party Transactions

 

There were advances of $124,913 and $78,989 from NAHL, the Company’s principal shareholder, during the twelve-month period ended December 31, 2019 and 2018, respectively. The total advances due are $836,452 and $711,539 from our principal shareholder as of December 31, 2019 and December 31, 2018, respectively. As of December 31, 2019, and 2018, the advances constitute unsecured interest-free loans to the Company. The advances were supposed to have been repaid by the close of business on October 31, 2016. In 2016, however, the Company and NAHL agreed that if the Company was unable to repay these advances by such date, NAHL, at its sole discretion, would have the option to extend the repayment deadline or convert all or a portion of the above advances into common stock of the Company at a conversion price of $0.02 per share. As of December 31, 2019, NAHL, the Company’s principal shareholder, had not yet acted to exercise its option to convert the advances to shares of common stock, the total advances presently remain as an unsecured interest-free, and due on demand loan to the Company.

 

On September 7, 2015, Mr. Jose A. Capote ("Mr. Capote") was appointed to serve as the Company's Secretary and Vice President. There is no family relationship between Mr. Capote and any of the Company's directors or officers. Mr. Capote is currently a shareholder of the Company through his 50% ownership of Earth Heat Ltd. The Company has agreed to pay Jose Capote consulting fees for acting as the Company’s Secretary and Vice President in the amount of $18,000 and $18,000 for the twelve months ended December 31, 2019 and December 31, 2018, respectively. $18,000 and $13,500 is due to Jose Capote, as of December 31, 2019 and 2018, respectively.

 

The Company pays New Asia Momentum Pte Ltd (“NAMPL”), a Singapore private company owned and controlled by Dr. Lin Kok Peng, Chairman and CEO of the Company, fees for the rental of office space and for administrative services in its Singapore Headquarters. Dr. Lin Kok Peng also has voting and dispositive control over the shares of Company’s common stock held by NAHL, the Company’s principal stockholder. The Company has incurred fees of $58,271 and $35,513 due to NAMPL during the years ended December 31, 2019 and 2018, respectively. As of December 31, 2019 and 2018, the Company had $57,102 and $22,393 due to NAMPL recorded in accounts payable and accrued liabilities, respectively.

 

NAML paid MQL a total of $76 in related party service revenue for the twelve months ended December 31, 2018.

 

F-11


 


 

NEW ASIA HOLDINGS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the years ended December 31, 2019 and 2018

 

 

Note 6: Commitments and Contingencies

 

The Company entered into an Office Service Agreement on September 12, 2017 with Premier Business Centers (“PBC”). Under the terms of the agreement, PBC granted the Company a license to use the facilities and services of PBC at 15615 Alton Parkway Suite 450, Irvine, CA 92618. The basic term of this agreement is month to month commencing August 1, 2017 with monthly fixed fees of $950. This contract ended July 24, 2018.

 

The Company entered into another agreement with PBC on July 31, 2018. Under the terms of the agreement, PBC granted the Company a license to use the facilities and services of PBC at 15615 Alton Parkway Suite 450, Irvine, CA 92618. The basic term of this agreement is month to month commencing August 1, 2018 with monthly fixed fees of $195.

 

The Company pays New Asia Momentum Ptd Ltd, a Singapore private company owned and controlled by Dr. Lin Kok Peng, the Company’s Chief Executive Officer, Chief Financial Officer and Chairman of the Board, fees for the rental of office space and for administrative services in its Singapore headquarters. The basic term of the agreement is month to month commencing April 1, 2018 with monthly fixed fees of approximately $3,900.

 

Note 7 – Subsequent Events

 

From January 1, 2020 through April 17, 2020, the Company received an additional approximately $32,000 in interest-free advances from its principal controlling shareholder, New Asia Holdings, Ltd. As of April 17, 2020, the principal controlling shareholder, New Asia Holdings, Ltd has not yet acted to convert any of the Advances (as described above) to common stock, the advances remain as an interest free loan to the Company as of now.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

F-12


 

New Asia (QB) (USOTC:NAHD)
Historical Stock Chart
From Nov 2020 to Dec 2020 Click Here for more New Asia (QB) Charts.
New Asia (QB) (USOTC:NAHD)
Historical Stock Chart
From Dec 2019 to Dec 2020 Click Here for more New Asia (QB) Charts.