Indicate by check mark if
the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
Indicate by check mark if
the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☒
Indicate by check mark whether
the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether
the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T
during the preceding 12 months (or for such shorter period that the registrant was required to submit). Yes ☒ 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.
If an emerging growth company,
indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised
financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether
the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control
over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm
that prepared or issued its audit report. ☐
Indicate by check mark whether
the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
Indicate the number of shares
outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.
The aggregate market value
of the 65,929,372 shares of Common Stock of the registrant held by non-affiliates on September 30, 2020, the last business day of the
registrant’s second quarter, computed by reference to the price at which such stock was last sold is $0.
This Annual Report on Form
10-K includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended that are not historical facts, and involve risks and uncertainties that
could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical
facts, included in this Form 10-K including, without limitation, statements in the “Market Overview” and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s market projections, financial
position, business strategy and the plans and objectives of management for future operations, events or developments which the Company
expects or anticipates will or may occur in the future, including such things as future capital expenditures (including the amount and
nature thereof); expansion and growth of the Company's business and operations; and other such matters are forward-looking statements.
These statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical
trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances.
However, whether actual results or developments will conform with the Company's expectations and predictions is subject to a number of
risks and uncertainties, including general economic, market and business conditions; the business opportunities (or lack thereof) that
may be presented to and pursued by the Company; changes in laws or regulation; and other factors, most of which are beyond the control
of the Company.
These forward-looking statements
can be identified by the use of predictive, future-tense or forward-looking terminology, such as "believes," "anticipates,"
"expects," "estimates," "plans," "may," "will," or similar terms. These statements appear
in a number of places in this filing and include statements regarding the intent, belief or current expectations of the Company, and its
directors or its officers with respect to, among other things: (i) trends affecting the Company's financial condition or results of operations
for its limited history; (ii) the Company's business and growth strategies; and, (iii) the Company's financing plans. Investors are cautioned
that any such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, and
that actual results may differ materially from those projected in the forward-looking statements as a result of various factors many of
which are not within our control. Such factors that could adversely affect actual results and performance include, but are not limited
to, the Company's limited operating history, potential fluctuations in quarterly operating results and expenses, government regulation,
technological change and competition. For information identifying important factors that could cause actual results to differ materially
from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Current Report
on Form 8-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on August 8, 2018.
Consequently, all of the forward-looking
statements made in this Form 10-K are qualified by these cautionary statements and there can be no assurance that the actual results or
developments anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequence
to or effects on the Company or its business or operations. The Company assumes no obligations to update any such forward-looking statements.
PART I
ITEM 1. DESCRIPTION OF BUSINESS.
General
We were incorporated under
the laws of the State of Delaware on July 6, 2010 under the name “Advanced Ventures Corp.” Effective January 6, 2014, we changed
our name to “Gold Union Inc.” Effective March 26, 2018, we changed our name to Noble Vici Group, Inc. and our trading symbol
was changed to NVGI. On August 8, 2018, we consummated the acquisition of Noble Vici Private Limited, a corporation organized under the
laws of Singapore (“NVPL”), which was wholly owned by Eldee Tang, our sole director and Chief Executive Officer. NVPL is engaged
in the IoT, Big Data, Blockchain and E-commerce business. As a result of our acquisition of NVPL, we entered into the IoT, Big Data, Blockchain
and E-commerce business. We are headquartered in Singapore. Certain of our resellers are operating “V-More” branded satellite
offices in Shenzhen, China.
History
As Advanced Ventures Corp.,
we acquired a patent (U.S. Patent Number: 6,743,209) (the “Patent”), for a catheter with a integral anchoring mechanism. During
the second fiscal quarter of 2014, we elected to discontinue our business of exploiting the Patent and began to consider other business
opportunities that may bring quicker and greater value to our stockholders. We initially considered entering into the business of trading
precious metal bullion primarily in the Asia Pacific region. Therefore, effective January 6, 2014, we changed our name to “Gold
Union Inc.” to more adequately reflect our initial intended business operations.
Effective March 7, 2012, we
increased the number of our authorized shares of common stock to three billion shares (3,000,000,000) and engaged in a forward stock split
of our common shares whereby each one share of our common stock was split into fifteen shares of our common stock.
On December 31, 2015, we consummated
a Share Exchange Agreement with G.U. International Limited, a limited company incorporated under the laws of the Republic of Seychelles
and our wholly owned subsidiary (“GUI”), and Kao Wei-Chen, an individual representing herself and 8 other individuals (collectively,
the “Golden Corridor Shareholders”), which agreement was amended several times to extend the closing date of the acquisition
(collectively, the “Share Exchange Agreement”). Pursuant to the Share Exchange Agreement, we, through GUI, purchased 480 shares
of Phnom Penh Golden Corridor Trading Co. Limited (the “GC Shares”), from 9 private Golden Corridor Shareholders, representing
48% of the issued and outstanding shares of common stock of Golden Corridor. As consideration, we issued to the Golden Corridor Shareholders
2,500,000,000 shares of our common stock, at a value of US $0.002 per share, for an aggregate value of US $5,000,000.
As a result of our acquisition
of the GC Shares, we ceased our metal bullion trading business and entered into the real estate development and rental business located
in the Kingdom of Cambodia. Golden Corridor owns three parcels of land located at National Road 44, Phum Phkung, Chbarmorn Commune, Chbarmorn
District, Kampong Speu Province, Kingdom of Cambodia, measuring an aggregate of 172,510 square meters (collectively, the “Properties”).
We intended to develop the Properties into an industrial park for rental income.
Due to difficulties in entering
the real estate development and rental business, on February 2, 2018, we engaged in a corporate reorganization and distributed the GC
Shares to our shareholders. On March 18, 2018, our subsidiary, G.U. Asia Limited was dissolved.
Change in Control to Current
Business
On January 29, 2018, Eldee
Tang entered into Share Sale Agreements with Kao Wei-Chen and three other shareholders and former affiliates of the Company to purchase
up to 1,675,000,000 shares of the Company’s common stock at a per share purchase price of US$0.00008, for an aggregate price of
US$134,000. On June 15, 2018, the Company effectuated a 1 for 1,000 reverse stock split whereby every 1,000 shares of the Company’s
common stock were reduced to one share. The parties effectuated Mr. Tang’s purchase of 750,000 shares such securities (expressed
on a post reverse split basis) effective June 15, 2018. Mr. Tang hopes to purchase the balance of the 925,000 shares from Kao Wei-Chen,
an affiliate of the Company, in the future. The foregoing description of the Share Sale Agreement with Kao Wei-Chen
is qualified in its entirety by reference to such agreement which is filed as Exhibit 10.2 to this Quarterly Report and is incorporated
herein by reference.
In connection with the contemplated
change in control, on March 27, 2018, Lim Yew Chuan, the director, Chief Executive Officer, Chief Financial Officer and Secretary of Noble
Vici Group, Inc. (the “Company”), resigned from all of his positions as director, Chief Executive Officer, Chief Financial
Officer and Secretary of the Company. Concurrently, Eldee Tang was appointed to serve as the Chief Executive Officer and Director of the
Company, together with other members of the new management team.
Effective June 15, 2018, we:
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1.
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Increased the Company’s authorized capital from 3,000,000,000 shares of common stock, par value $0.0001 (the “Common Stock”), to 3,050,000,000 shares, consisting of 3,000,000,000 shares of Common Stock and 50,000,000 shares of undesignated preferred stock, par value $0.0001 (the “Preferred Stock”);
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2.
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Effected a 1-for-1000 reverse stock split of our issued and outstanding Common Stock (the “Reverse Stock Split”);
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3.
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Elected not to be governed by Section 203 of the Delaware General Corporation Law;
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4.
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Changed the Company’s fiscal year end from December 31st to March 31st, for all purposes (including tax and financial accounting);
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5.
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Adopted Amended and Restated Certificate of Incorporation for the purpose of consolidating the amendments to the Company’s Certificate of Incorporation; and
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6.
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Adopted the Amended and Restated Bylaws of the Company.
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Acquisition of NVPL, TDA
and NDA
On August 8, 2018, we consummated
the acquisition of Noble Vici Private Limited, a corporation organized under the laws of Singapore (“NVPL”), in accordance
with the terms of a Share Exchange Agreement. NVPL is wholly owned by Eldee Tang, our Chief Executive Officer and Director. Pursuant to
the Share Exchange Agreement, we purchased One Million and One (1,000,001) shares of NVPL (the “NVPL Shares”), representing
all of the issued and outstanding shares of common stock of NVPL, in consideration of One Hundred Forty Million (140,000,000) shares of
our common stock, at a value of US $1.70 per share, for an aggregate value of US $238,000,000. It is our understanding that Mr. Tang is
not a U.S. Person within the meaning of Regulations S. Accordingly, the Shares are being sold pursuant to the exemption provided by Section
4(a)(2) of the Securities Act of 1933, as amended, Regulation D and Regulation S promulgated thereunder. As a result of our acquisition
of NVPL, we entered into the IoT, Big Data, Blockchain and E-commerce business.
On September 17, 2018, we
consummated the acquisition of a 51% controlling interest in The Digital Agency Private Limited, a private limited company organized under
the laws of Singapore (“TDA”), and a start-up digital marketing company, in accordance with the terms of that certain Share
Exchange Agreement by and among the Company, NIApplications Private Limited (formerly, “Noble Infotech Applications Private Limited”),
a private limited company organized under the laws of Singapore and our wholly owned subsidiary (“NIA”), TDA and Mok Jo Han
(“the “TDA Share Exchange Agreement”). Pursuant to the terms of the TDA Share Exchange Agreement, we acquired 51 ordinary
shares of TDA, representing approximately fifty-one percent (51%) of the issued and outstanding ordinary shares of TDA, in exchange for
510,000 shares of common stock of the Company, par value $0.0001 (the “TDA Shares”), representing an exchange ratio of ONE
(1) ordinary share of TDA for Ten Thousand (10,000) shares of common stock of the Company, at a valuation of $2.00 per share of the Company,
for an aggregate value of $1,020,000. It is our understanding that Mr. Mok is not a U.S. Person within the meaning of Regulations S. The
TDA Shares were sold pursuant to the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and Regulation S
promulgated thereunder.
On September 17, 2018, we
consummated the acquisition of a 51% controlling interest in Noble Digital Apps Sendirian Berhad, a private limited company organized
under the laws of Malaysia (“NDA”), and a start-up digital apps and big data company in accordance with the terms of that
certain Share Exchange Agreement by and among the Company, NIA, NDA, Cheng Bok Woon, Tan Yew Fui, and Yong Swee Sun (“the “NDA
Share Exchange Agreement”). Pursuant to the terms of the NDA Share Exchange Agreement, we acquired 510 ordinary shares of NDA, representing
approximately fifty-one percent (51%) of the issued and outstanding ordinary shares of NDA, in exchange for 510,000 shares of common stock
of the Company, par value $0.0001 (the “NDA Shares”), representing an exchange ratio of ONE (1) ordinary share of NDA for
One Thousand (1,000) shares of common stock of the Company, at a valuation of $2.00 per share of the Company, for an aggregate value of
$1,020,000. It is our understanding that Mr. Cheng, Mr. Tan and Mr. Yong are not U.S. Person within the meaning of Regulations S. The
NDA Shares were sold pursuant to the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and Regulation S
promulgated thereunder.
Issuance of shares to sales
affiliates
On September 17, 2018, and
September 25, 2018, we approved the issuance of Nine Million One Hundred Thirty Five Thousand Seven Hundred Ninety Four (9,135,794) shares
and Five Hundred Sixty Seven Thousand Sixty-Four (567,064) shares of our common stock, par value $0.0001, respectively, representing a
total of approximately 6.3% of our issued and outstanding common stock, at a per share price of One Dollars and Ninety Nine Cents (US
$1.99), to approximately 460 sales associates for prior sales and marketing services provided to us and our subsidiaries and affiliates.
As a condition of receipt of such securities, each recipient executed a Stockholder Representation Letters, which contained, among other
things, restrictions prohibiting the transfer of such securities for a minimum period of 18 months up to a maximum period of 66 months
after the execution of such letter. For ease of administration, the recipients appointed Noble Infotech Limited (“NIL”) as
nominee to hold, manage, administer and effectuate the distribution of such securities upon the expiration of the applicable restricted
periods. The shares were issued on October 18, 2018 to NIL. The securities were issued pursuant to the exemption provided by Section 4(a)(2)
of the Securities Act of 1933, as amended, and Regulation S promulgated thereunder. The foregoing description of the Stockholder Representation
Letters is qualified in its entirety by reference to such agreements which are filed as Exhibit 10.3 to this Annual Report and are incorporated
herein by reference.
On December 3, 2018, we approved
the issuance of up to an aggregate of Ten Million Eight Hundred Thirty-Eight Thousand One Hundred Forty One (10,838,141) shares of our
common stock, par value $0.0001, representing approximately 7.1% of our issued and outstanding common stock, at a per share price of Two
Dollars (US $2.00), to about 690 sales associates for prior sales and marketing services provided to us and our subsidiaries and affiliates.
As a condition of receipt of such securities, each recipient was required to execute one of two standard forms of Stockholder Representation
Letters, which contained, among other things, restrictions prohibiting the transfer of such securities for a minimum period of 18 or 24
months up to a maximum period of 72 months after the execution of such letter. For ease of administration, the recipients appointed Venvici
Partners Limited (“VVP”) as nominee to hold, manage, administer and effectuate the distribution of such securities upon the
expiration of the applicable restricted periods. The shares were issued on January 4, 2019 to VVP. The securities were issued pursuant
to the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and Regulation S promulgated thereunder. The foregoing
description of the Stockholder Representation Letters and Trustee Appointment Letter is qualified in its entirety by reference to such
agreements which are filed as Exhibits 10.4 and 10.5 to this Annual Report and are incorporated herein by reference.
On March 11, 2019, our Board
of Directors, approved the issuance of up to an aggregate of Fifteen Million (15,000,000) shares of our common stock, par value $0.0001,
representing approximately 8.4% of our issued and outstanding common stock (collectively, the “Shares”), at a per share price
of Two Dollars (US $2.00), to about 700 sales associates for prior sales and marketing services provided to us and our subsidiaries and
affiliates. As a condition of receipt of such securities, each recipient was required to execute one of two standard forms of Stockholder
Representation Letters, which contained, among other things, restrictions prohibiting the transfer of such securities for a minimum period
of 18 months up to a maximum period of 66 months after the execution of such letter. For ease of administration, the recipients appointed
VVP as nominee to hold, manage, administer and effectuate the distribution of the Shares upon the expiration of the applicable restricted
periods. For so long as VVP is the stockholder of record of the Shares, VVP shall serve as the attorney in fact to vote such Shares at
any annual, special or other meeting of the stockholders of the Company, and at any adjournment or adjournments thereof, or pursuant to
any consent in lieu of a meeting or otherwise, with respect to any matter that may be submitted for a vote of stockholders of the Company.
The securities will be issued pursuant to the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and Regulation
S promulgated thereunder. The foregoing description of the Stockholder Representation Letters and Trustee Appointment Letter is qualified
in its entirety by reference to such agreements which are filed as Exhibit 10.6 and 10.7 to this Annual Report and are incorporated herein
by reference.
On March 19, 2019, we registered
Twenty-One Million Four Hundred Eighty Thousand (21,480,000) shares of the Company’s common stock, par value $0.0001 per share (“Common
Stock”), the amount of shares issuable under the Merchant Acquisition Agreement between the Company and the certain consultants
and Ten Million (10,000,000) shares of Common Stock, the amount of shares issuable under the Consulting Agreement between the Company
and a vendor. The Consultants were engaged for the onboarding services into our V-More ecosystem for the Merchants in Greater China Region,
while the Vendor was engaged for fulfilment of our customers through the arranged online platform and related digital offerings. The securities
are registered pursuant to the Form S-8 Registration Statement. The foregoing description of the Merchant Acquisition Agreements
and the Consulting Agreement is qualified in its entirety by reference to such agreements which are filed as Exhibits 10.8 through and
including 10.11 to this Annual Report and are incorporated herein by reference.
Reorganization of UB45,
Ventrepreneur (SG), AIM System and VMore Merchants
On September 17, 2018, NVGI
acquired from Eldee Tang, our Chief Executive Officer, Interim Chief Financial Officer, Interim Secretary and Director, 100% of UB45 Private
Limited, a private limited company organized under the laws of Singapore (“UB45”), that had no existing business, assets or
liabilities.
In January and May 2019, we
completed a series of reorganizations pursuant to which we reorganized UB45, Ventrepreneur (SG) Private Limited, a private limited company
formed under the laws of Singapore (“VESG”), AIM System Private Limited (“AIM”) and VMore Merchants Private Limited
(“VM”) into NVGI. Prior to the reorganization:
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UB45 was a company with the operation office building as its main primary asset that was wholly owned by NVGI;
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VESG was a subsidiary of Venvici Private Limited (“VVPL”) with nominal assets and liabilities;
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AIM was formed for the purpose of providing Customer Relation Management system for V-More customers and had nominal assets and liabilities; and
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VM was formed for providing merchants onboarding services into our V-More ecosystem and had nominal assets and liabilities.
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Prior to the reorganization, AIM and VM were owned
by our non-affiliate shareholders, Chia Poh Wah Jason and Desmond Tan Ching Teck respectively.
In March 2020, we divested
all interest in VVPL; and reorganized Venvici Limited, a private limited company formed under the laws of Seychelles (“VVL”)
as a wholly owned subsidiary of NVPL. Prior to the reorganization:
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VVPL was a wholly owned subsidiary of NVPL; and
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VVL was a wholly owned subsidiary of VVPL with nominal assets and liabilities.
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Corporate Structure
As of August 3, 2021, our
corporate structure is below:
Our Operations and Future
Plans
Ecommerce Platform
We are focused on providing
users with innovative tools to live and interact in the modern mobile world through our ecosystem of IoT, Big Data, Blockchain and E-commerce
products and services. We integrate blockchain technology with our E-commerce platform to connect consumers and merchants in a dynamic
global marketplace via blockchain transactions. We onboard users, consumers and referrers through our Affiliate Incentivized Marketing
to Advertising Dollar Sharing (formerly known as Affiliate Incentivized Marketing (AIM)) model while merchants are onboarded via our Merchant
Incentivized Marketing (MIM) model. Some products and services offered in our ecosystem include procurement of discounted goods and services,
referral reward system, mobile games and digital marketing, financial markets apps and a “Business Centre” within the same
app. Our E-commerce platform not only offers users the ability to make online purchases, but also the convenience of an O2O (Online to
Offline) platform whereby consumers can transact at a discount online while goods and services are distributed at a physical location.
This drives traffic to the already weakened retail industry. The Business Centre within our ecosystem is offered through a mobile app
and allows users to create their own referral platform within our ecosystem.
Advertising Dollar Sharing
(ADS)
We have rebranded our Affiliate
Incentivized Marketing to Advertising Dollar Sharing. Similar to the AIM model, the ADS business model also involves driving online and
physical traffic and increasing sales and marketing of targeted products and services. Its enhanced function includes distribution of
advertising dollars via ADS system to agencies, affiliate marketers, advertiser, users and referrals.
Sale and Distribution
of IoT Smart Devices / VMore System Private Limited
In addition to the E-commerce
platform, we intend to focus on the sales and distribution of IoT smart devices and appliances. In September, 2019, we began to sell our
first IoT appliance, our smart coffee dispensing machines (the V-More Express (“VX”)). Our initial plans of beginning machine
distribution on or about the third calendar quarter of 2020 were delayed by the COVID-19 pandemic. We are currently monitoring the situation
and hope to begin machine distribution and their progressive operation in Singapore once the economy begins to return to normalcy. We
hope to derive income from sales of our VX IoT hardware, the core consumables in VX and the advertising services we provide to our customers
in connection with the VX.
Features of the VX; Revenue
Sources:
Machine Capacity: The VX offers
9 types of beverages, holds 60 liters of distilled water tank and is able to produce 400 cups of beverages. VX currently offers
barista-grade coffee in 9 different varieties in both hot and ice options. VX can be modified to allow for other offerings to be sold.
We expect to adopt regional pricing for core products sales, aligning to each specific market’s demand and supply.
AdTech: In addition to sales
of core products, we expect to rely on advertisements placed through the VX to drive revenue. We intend to seek advertisers that are proximate
to each specific VX to display their advertisements through our smart machine. We believe that the use of local advertisements (Proximate
Location Ads, or PLA) will drive relevant traffic to nearby physical merchants as well as online merchants. Advertisements can be static
or dynamic and may be interactive, allowing user interaction. We expect to provide services to advertisers to assist them in creating
and placing effective ads in the VX.
Smart Technology: The VX features
a 42 inch touch screen with Smart Digital Panel Advertising Technology (“SDPAT”) that allows users to interact with advertisements
via its interactive touch screen. Through the VX, we hope to capture users’ spending behaviour, advertisement interactions and other
quantitative data, while developing our Big Data analytics. Data from our machines can be integrated with our ecommerce platform to facilitate
the offering of discounts, rewards or other products and services across our e-commerce platform. We believe that additional data will
allow us to: (i) deliver and improve our offerings and services of our online VMore E-commerce platform; (ii) improve synergy with offline
merchants; (iii) improve the efficacy of our advertising services; and (iv) improve sales of products offered by the VX.
VX
Operations
Our
VX business operations are segregated into the following core functions to address the needs of our advertisers, VX IoT hardware purchasers
and consumers.
Sales and Marketing Team.
Our team will focus on the sale of the VX IoT hardware. Its targeted industries are primarily from real estate and property owners
such as commercial offices, retails and buildings, where the VX will be installed. In addition to the sale of VX, the team will also create
brand awareness of the VX and its core offerings in the VX.
Advertiser Onboarding Team.
Once an advertiser engages us online to have its advertisement placed in VX, a member of our advertiser onboarding team will initiate
the first of several communications with the merchant to introduce the advertiser to the technology involved in our PLA ecosystem. Before
the advertisement goes live on the VX, the team will work with the advertiser to build and create the advertisement. We will provide tools
such as an app to ensure the advertisement traffic monitoring and management are aligned. All advertisements will be proximate locality
based, ensuring relevance for targeted traffic to be driven.
Operation and Maintenance
Team(O&M). Once the VX are deployed, O&M team will monitor the performance of each VX deployed for its ingredients supply,
hardware status and data collection efficiency. Maintenance of the hardware for performance to prevent downtime and refilling the ingredients
into the VX will be undertaken by the O&M team.
Customer/User
Service Representatives. Our customer service representatives will be reachable via the app or email 24 hours a day, seven days
a week. The customer service team will also work with our technology team to improve the experience of VX owners, consumers and advertisers
on the mobile application based on their feedback.
Technology.
We employ technology to improve the experience we offer to VX owners, users and advertisers, increase the rate at which our users
use our V-More Pro platform and enhance the efficiency of our business operations. A component of our strategy is to continue developing
and refining our technology. With the future use of blockchain technology for recording and collecting data, we believe the security of
transactional records will be increased, protecting the accuracy of data held by VX owners, advertisers and users. We believe that basing
transactional data on a private blockchain network will facilitate a smoother and faster transaction completion.
We
expect to use an algorithm to analyze data collected through our VX ecosystem. As the volume of transactions grow organically through
increased deployment of VXs, we expect to increase the amount of data that we can collect and analyze. We believe that such data will
allow us to continue to improve the experience of our VX owners, advertisers and consumers which, in turn, will help us improve the way
the ecosystem flows.
Cybersecurity.
We have integrated our technology with encryption algorithm “SHA3-256” & RSA Public/Private-Key, which is designed to
withstand timing attacks. It also accepts any 32-byte string as a valid public key and does not require validation. We believe that the
security of transaction records within our current system is adequate.
Advertising
Dollar Sharing (ADS). We believe our ADS model will allow users and advertisers to benefit from reduced costs to consumers and
higher traffic for advertisers. We expect users to benefit from discounts and advertising dollar rebates offered through our PLA ecosystem
from online and offline merchants, referrals, and internal marketing efforts, with advertisers benefitting from increased retail sales
volume offline or online.
Core
Product/User Scale. We hope to include other products from mass market merchants, such as food and other beverages, as part of our
product and service offerings. We believe that outreach to the mass market will be more effective to drive traffic for the advertisers/merchants
where simple to complex transactions can be achieved through adoption of an incentivized model.
Brand.
A substantial portion of our VX owners, advertisers and users are acquired through agencies, word-of-mouth & social network/platforms.
We believe that relying on the referral process, in turn, will improve the quality of our user base, advertisers and VX owners as well
as brand awareness. We expect that higher confidence in our brand will facilitate acquiring more users, advertisers and VX owners for
our ecosystem.
We
operate our IoT Smart Device business through VMore System Private Limited (formerly, “ToroV System Private Limited”), our
wholly owned subsidiary (“VSPL”). VSPL was incorporated in Singapore on July 22, 2019, and operates with our subsidiary AIM
System Private Limited (“ASPL”), a Singapore private limited corporation incorporated on April 1, 2019, as described below:
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VSPL – engages in sales and marketing of VX and barista grade coffee to owners and consumers, operates and maintains the VX including support, both technical and non-technical;
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ASPL – engages in VX software technology integration; Proximate Location Ads (“PLA”) activities such as advertisement sales, build, create and deploy its proprietary software technology (“PropST”); distribute advertising dollars via an Advertising Dollar Sharing (“ADS”) system to agencies, affiliate marketers, advertisers, users and referrals; provide technical and non-technical support in relation to PLA; and engages in brand management, marketing, promotions and media engagement activities.
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VX vendor
We expect to rely on Barista
Uno Private Limited (“BUPL”) to provide VSPL with VX IoT hardware and coffee sourcing, distribution, and logistical upstream
and downstream fulfilment services. Eldee Tang, our Chief Executive Officer, Interim Chief Financial Officer, Interim Secretary and Director
owns 31% of BUPL. As a result of the Covid-19 pandemic, Singapore has enacted heightened measures since April 7, 2020, that have restricted
movement in people, goods and services for most businesses in Singapore. As a result, we our sales operations for VX related offerings
were materially and adversely impacted. Our expected recovery timeline will depend on the policies of the Singapore Government moving
forward, such as lifting of the movement restriction measures. We expect such impact to continue at least throughout the balance of calendar
year 2021.
Other Initiatives
We are generally pursuing
a plan of expansion and hope to achieve revenue growth through mass adoption by users and merchants of our platform/ecosystem. We seek
to increase our user and merchant base through user incentive programs and brand awareness marketing programs, among other things. We
expect to focus on users and merchants located in China and the Asia Pacific region in the foreseeable future. There can be no assurance,
however, that we will be able to successfully grow our revenues in the future, if ever.
Effective May 27, 2021, we
granted Accell Technologies, Inc. (“ATI”) an exclusive license to use, market and sell our E-commerce Aggregator, Reward,
AIM and AdTech system (“System”) in North America and South America for a period of 10 years (the “ATI License Agreement”).
Pursuant to the terms of the ATI License Agreement, ATI is obligated to pay a royalty fee of 10% of gross revenues, not to exceed 20%
of EBITDA on a per country basis in addition to other set up and software maintenance fees. ATI completed its evaluation of our System,
and we expect ATI to complete the general software requirements specification (“SRS”) submission during the calendar quarter
ended September 30, 2021. The foregoing description of the ATI License Agreement is qualified in its entirety by reference to such agreement
which is filed as Exhibit 10.15 to this Annual Report.
Effective June 25, 2021, we
appointed Greatsolutions Pte. Ltd., a Singapore corporation, (“GSP”) to serve as our authorized distributor of our new biodegradable
waste recycling machine for the territory of Singapore in accordance with the terms of that certain Authorized Distributor Agreement (the
“Authorized Distributor Agreement”). Pursuant to the terms of the Authorized Distributor Agreement, agreed to purchase 100
units of our machines as well as other related products and pay a license fee of One Million Dollars for the first year of the term. The
term of the Authorized Distributor Agreement will begin upon the successful commission of the first machine in Singapore. We are in the
process of working with the relevant governmental agencies to have the machines commissioned for use in Singapore. As of the date of this
Annual Report, we received $100,000 as a portion of the license fee. The foregoing description of the Authorized Distributor Agreement
is qualified in its entirety by reference to such agreement which is filed as Exhibit 10.16 to this Annual Report.
Near-Term Requirements
For Additional Capital
For the immediate future,
we intend to finance our business efforts and any future acquisitions through sales of our securities to existing shareholders and loans
from existing shareholders or financial institutions. We have not yet generated sufficient revenues. We expect to incur operating losses
over the next twelve months until we have made substantial deployment of our VX machines and also increased our business operations. We
continue to seek new partnerships regionally or acquire fully operating company in relation to VX operation and maintenance (“O&M”)
and VX regional sales. There can be no assurance that that we will be successful in consummating a business partnership or acquisition
or that such partnership or business will be successful after acquisition.
Intellectual Property
We continue to own the rights,
title and interests in Patent for a receptacle catheter with integral anchoring means, which Patent is associated with our former business.
The Patent was issued on September 1, 2004 and will expire on September 6, 2022. We do not expect to exploit this Patent in the near future.
Employees
As of June 20, 2021, we have
the following employees:
Executive Officer
|
|
|
1
|
|
Tech Development Staff
|
|
|
2
|
|
Administration Staff
|
|
|
3
|
|
Finance
|
|
|
2
|
|
Total
|
|
|
8
|
|
All of our employees are
located in Singapore. None of our employees are members of a trade union. We believe that we maintain good relationships with our employees
and have not experienced any strikes or shutdowns and have not been involved in any labor disputes. However, due to the COVID-19 pandemic,
our ability to generate sufficient revenues have been materially and adversely impacted. As a result, we have deferred partial salaries
of all staff as part of our cost cutting/deferment measures.
We are required to make
contributions under a defined contribution pension plan for all of our eligible employees in Singapore. We are required to contribute
a specified percentage of the participants’ relevant income based on their ages and wages level. The total contributions made were
$210,561 and $218,354, for the years ended March 31, 2021, and 2020, respectively.
Available Information:
Access to all of our Securities and Exchange Commission (“SEC”) filings, including our Annual Report on Form 10-K, quarterly
reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is provided, free of charge, on our website
(www.noblevici.com) as soon as reasonably practicable after such reports are electronically filed with, or furnished to, the SEC.
Pacific Stock Transfer Company
located at 6725 Via Austi Pkwy, Suite 300, Las Vega, Nevada 89119, telephone number (800) 785-7782, facsimile (702) 433-1979, serves as
our stock transfer agent.
ITEM 1A. Risk Factors.
We are a smaller reporting
company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.
ITEM 1B. Unresolved Staff
Comments.
We are a smaller reporting
company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
ITEM 2. Properties.
On January 31, 2021, we terminated
our service office lease at 1 Raffles Place, #33-02, One Raffles Place Tower One, Singapore 048616. Our new principal office is located
at 45 Ubi Crescent, Singapore 408590.
On October 1, 2018, we purchased
a building subject to a sixty year leasehold located at 45 Ubi Crescent, Singapore 408590 to serve as our primary operational center.
The four story building is approximately 13,000 square feet with a remaining lease term of thirty eight years. The purchase price of SGD$4,480,000
(approximately US$3,295,819) was financed by a loan with Ethoz Capital Limited in the principal amount of SGD$3,136,000 (approximately
US$2,307,073) at an annual rate of 3.75%, payable over 120 months commencing October 1, 2018. The loan is personally guaranteed by our
Chief Executive Officer, Interim Chief Financial Officer, Interim Secretary and Director, Eldee Tang. The foregoing description of the
loan is qualified in its entirety by reference to the Secured Term Loan Facility dated September 14, 2018, which is filed as Exhibit 10.13
to this Annual Report and incorporated herein by reference.
We believe that our current
facilities are adequate for our current needs. We intend to secure new facilities or expand existing facilities as necessary to support
future growth. We believe that suitable additional space will be available on commercially reasonable terms as needed to accommodate our
operations.
ITEM 3. Legal Proceedings.
In April 2020, we received
invoices from each of the Public Company Accounting Oversight Board (“PCAOB”) and the Financial Accounting
Standards Board (“FASB”) in the amounts of $702,600 and $92,100, respectively, for our share of the PCAOB and FASB Issuer
Accounting Support Fee for calendar year 2020. The fees were due May 18, 2020. We have petitioned the PCAOB and FASB to review our fee
assessments and are in the process of review.
In accordance with applicable
accounting guidance, the Company records accruals for certain of its outstanding legal proceedings, investigations or claims when it is
probable that a liability will be incurred, and the amount of loss can be reasonably estimated. The Company evaluates, on a quarterly
basis, developments in legal proceedings, investigations or claims that could affect the amount of any accrual, as well as any developments
that would make a loss contingency both probable and reasonably estimable. The Company discloses the amount of the accrual if the financial
statements would be otherwise misleading.
When a loss contingency is
not both probable and estimable, the Company does not establish an accrued liability. However, if the loss (or an additional loss in excess
of the accrual) is at least a reasonable possibility and material, then the Company discloses an estimate of the possible loss or range
of loss, if such estimate can be made or discloses that an estimate cannot be made.
The assessments whether a
loss is probable or a reasonable possibility, and whether the loss or a range of loss is estimable, often involve a series of complex
judgments about future events. Management is often unable to estimate a range of reasonably possible loss, particularly where (i) the
damages sought are substantial or indeterminate, (ii) the proceedings are in the early stages, or (iii) the matters involve novel or unsettled
legal theories or a large number of parties. In such cases, there is considerable uncertainty regarding the timing or ultimate resolution
of such matters, including a possible eventual loss, fine, penalty or business impact, if any.
We expect that the aggregate
range of reasonably possible losses, within the accruals established, if any, for such legal proceeding is likely to range from approximately
$800,000 and upwards if penalties or interest are assessed against us in the event that we are unable to timely pay assessed
amounts. The estimated aggregate range of reasonably possible losses is based upon currently available information for those proceedings
in which the Company is involved, taking into account the Company’s best estimate of such losses for those cases for which such
estimate can be made. Those matters for which an estimate is not possible are not included within this estimated range. Therefore, such
range represents what the Company believes to be an estimate of possible loss only for those matters meeting such criteria. It does not
represent the Company’s maximum loss exposure.
Except as set forth above,
there are no material pending legal proceedings to which we or our subsidiaries are a party or to which any of our or their property is
subject, nor are there any such proceedings known to be contemplated by governmental authorities. None of our directors, officers, affiliates
or any owner of record or beneficially of more than 5% of our common stock, or any associate of any of the foregoing, is involved in a
proceeding adverse to our business or has a material interest adverse to our business.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
PART III
ITEM 10. Directors, Executive
Officers and Corporate Governance.
Set forth below are the present
directors and executive officers of the Company. Note that there are no other persons who have been nominated or chosen to become directors
nor are there any other persons who have been chosen to become executive officers. There are no arrangements or understandings between
any of the directors, officers and other persons pursuant to which such person was selected as a director or an officer. Directors are
elected to serve until the next annual meeting of stockholders and until their successors have been elected and have qualified. Officers
are appointed to serve until the meeting of the board of directors following the next annual meeting of stockholders and until their successors
have been elected and qualified.
Name
|
|
Age
|
|
Position
|
Eldee Wai Chong Tang
|
|
45
|
|
Chief Executive Officer, Chief Financial Officer (interim), Chief Corporate Officer, Secretary and Director
|
Biographies
Set forth below are brief
accounts of the business experience during the past five years of each director, executive officer and significant employee of the Company.
Sir Eldee Tang,
age 45, joined us as our Chief Executive Officer and Director on March 27, 2018. On June 21, 2019, Mr. Tang was appointed as an Interim
Chief Financial Officer. On March 31, 2021, Mr. Tang was appointed as Interim Chief Corporate Officer and interim Secretary. He has served
as a Partner and Executive Director of Venvici Pte. Ltd., a SME that focuses on crowdsourcing in e-commerce and mobile commerce technology,
since April 2015. Mr. Tang founded Noble Infotechnologies Pte. Ltd., a data analytics company focusing on financial IT infrastructure
technologies, and has served as its Managing Director since 2006. Mr. Tang also founded Infinite Lifestyle Pte. Ltd., a wellness
and related product company, and served as its Managing Director from April 2006 to 2012. Mr. Tang received his Diploma in Electronic
and Computer Engineering from Ngee Ann Polytechnic in Singapore in 1996, his Masters in Business Administration from the University of
South Australia in 2008 and his Doctorate in Business Administration from the International America University in Los Angeles in 2016.
Mr. Tang is a seasoned entrepreneur
in the e-commerce and fintech industry. He is the recipient of numerous distinguished business awards including the Most Promising Entrepreneur
Award from Asia Pacific Entrepreneur Award (APEA) in 2010 as well as the Global Outstanding Young Chinese Award by the Global Chinese
Outstanding Youth in 2016. In 2017, he was knighted by the Sovereign Order of Saint John of Jerusalem, Knights of Malta for his philanthropic
contributions. We believe that Mr. Tang’s deep experience in e-commerce, big data and internet industries qualifies him to serve
on our Board of Directors.
Family Relationships
Mr. Tang does not have a direct
family relationship with any of the Company’s directors or executive officers, or any person nominated or chosen by the Company
to become a director or executive officer.
Involvement in Certain Legal Proceedings
No executive officer or director
has been involved in the last ten years in any of the following:
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·
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Any bankruptcy petition filed by or against any business or property of such person, or of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;
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·
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Any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
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·
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Being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities;
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·
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Being found by a court of competent jurisdiction (in a civil action), the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;
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·
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Being the subject of or a party to any judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated relating to an alleged violation of any federal or state securities or commodities law or regulation, or any law or regulation respecting financial institutions or insurance companies, including but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail, fraud, wire fraud or fraud in connection with any business entity; or
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·
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Being the subject of or a party to any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act, any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
|
Board Committees and Audit Committee Financial Expert
We do not currently have a
standing audit, nominating or compensation committee of the board of directors, or any committee performing similar functions. Our board
of directors performs the functions of audit, nominating and compensation committees. As of the date of this report, no member of our
board of directors qualifies as an “audit committee financial expert” as defined in Item 407(d)(5) of Regulation S-K promulgated
under the Securities Act. We hope to attract a director who qualifies as an “audit committee financial expert” as our business
operations mature.
Director Nominations
On April 26, 2018, the Board
and stockholders holding a majority of our issued and outstanding securities authorized, adopted and approved by written consent in lieu
of a special meeting the Amended and Restated Certificate of Incorporation (the “Restated Certificate”) and the Amended and
Restated Bylaws of the Company (the “Restated Bylaws”). The Restated Bylaws contain new provisions that may have the effect
of delaying, deferring or discouraging another person from acquiring control of the Company. These provisions are designed to encourage
persons seeking to acquire control of us to first negotiate with our Board and to discourage certain types of coercive takeover practices
and inadequate takeover bids. Among other things, the Restated Certificate and the Restated Bylaws provide that:
|
·
|
Our stockholders may not call special meetings of our stockholders unless they hold in excess of 50% of the shares entitled to vote at a meeting of stockholders. Stockholders requesting a special meeting to act on any matter that may properly be considered at a meeting of stockholders must submit a written request to the secretary of the Corporation. Such meeting request must contain all information required pursuant to the Restated Bylaws, be sent to the secretary by registered mail, return receipt requested, and be received by the secretary within 60 days after the record date;
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|
·
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In any annual meeting of our stockholders, stockholders may not act on any matter not properly brought before the meeting. A matter is considered to have been properly brought before a meeting if the stockholder has given timely notice thereof in writing to the secretary of the Corporation and such business is a proper matter for action by the stockholders. To be timely, a stockholder’s notice shall set forth all information required pursuant to the Restated Bylaws and shall be delivered to the secretary at the principal executive office of the Corporation not earlier than the 150th day nor later than 5:00 p.m., Eastern Time, on the 120th day prior to the first anniversary of the date of the proxy statement for the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is advanced or delayed by more than 30 days from the first anniversary of the date of the preceding year’s annual meeting, notice by the stockholder to be timely, such notice must be so delivered not earlier than the 150th day prior to the date of such annual meeting and not later than 5:00 p.m., Eastern Time, on the later of the 120th day prior to the date of such annual meeting, as originally convened, or the tenth day following the day on which public announcement of the date of such meeting is first made. The public announcement of a postponement or adjournment of an annual meeting shall not commence a new time period for the giving of a stockholder’s notice as described above;
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|
·
|
Our stockholders may not nominate persons to our Board unless they comply with certain nomination procedures. A stockholder must deliver notice of its intent to nominate persons to be elected to the Board to the secretary of the Company not earlier than the 150th day nor later than 5:00 p.m., Eastern Time, on the 120th day prior to the first anniversary of the date of the proxy statement for the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is advanced or delayed by more than 30 days from the first anniversary of the date of the preceding year’s annual meeting, notice by the stockholder to be timely, such notice must be so delivered not earlier than the 150th day prior to the date of such annual meeting and not later than 5:00 p.m., Eastern Time, on the later of the 120th day prior to the date of such annual meeting, as originally convened, or the tenth day following the day on which public announcement of the date of such meeting is first made. The public announcement of a postponement or adjournment of an annual meeting shall not commence a new time period for the giving of a stockholder’s notice as described above. Such stockholder’s notice must include all information required pursuant to the Restated Bylaws, which shall include information regarding (i) the stockholder, (ii) any person acting in concert with such stockholder, (iii) any beneficial owner of shares of stock of the Corporation owned of record or beneficially by such stockholder (other than a stockholder that is a depositary) and (iv) any person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such stockholder or any of the persons described in sections (ii) and (iii) above. Such notice shall contain, among other things, a written undertaking certifying that such proposed nominee (a) is not, and will not become a party to, any agreement, arrangement or understanding with any person or entity other than the Company in connection with service or action as a director that has not been disclosed to the Company;
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Our Board may designate the terms of, and issue a new series of preferred stock with, voting or other rights without stockholders approval;
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·
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Our directors have the power to adopt, amend or repeal our bylaws without stockholders approval;
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·
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Our stockholders may not cumulate votes in the election of directors; and
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·
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We will indemnify directors and officers against losses that they may incur in investigations and legal proceedings resulting from their services to us, which may include services in connection with takeover defense measures.
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Such notice shall contain,
among other things, a written undertaking certifying that such proposed nominee (a) is not, and will not become a party to, any agreement,
arrangement or understanding with any person or entity other than the Company in connection with service or action as a director that
has not been disclosed to the Company.
These provisions might preclude
our stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual
meeting of stockholders if the proper procedures are not followed. We expect that these provisions might also discourage or deter a potential
acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain
control of our company.
Our board of directors does
not have a policy with regards to the consideration of any director candidates recommended by our shareholders. Our board of directors
has determined that it is in the best position to evaluate our company’s requirements as well as the qualifications of each candidate
when the board considers a nominee for a position on our board of directors.
Except as set forth above,
we have not established formal procedures by which security holders may recommend nominees to the Company’s board of directors.
Code of Ethics
We have adopted a Code of
Business Conduct and Ethics that applies to our directors, officers, and employees. A copy of our Code of Business Conduct and Ethics
is filed as Exhibit 14 to this Annual Report and may be obtained free of charge by contacting us at the address or telephone number listed
on the cover page hereof.
ITEM 11. Executive Compensation.
Compensation Philosophy and Objectives
Currently, our executive directors
and officers receive cash compensation for services in such capacities. We expect to establish an incentive compensation plan as our company
matures. We expect that our executive compensation philosophy will be to create a long-term direct relationship between pay and our performance.
Our executive compensation program will be designed to provide a balanced total compensation package over the executive’s career
with us. The compensation program objectives will be to attract, motivate and retain the qualified executives that help ensure our future
success, to provide incentives for increasing our profits by awarding executives when corporate goals are achieved and to align the interests
of executives and long-term stockholders. We expect the compensation package of our named executive officers to consist of the following
main elements:
|
1.
|
base salary for our executives that is competitive relative to the market, and that reflects individual performance, retention and other relevant considerations;
|
|
2.
|
incentive compensation consisting of stock options, restricted stock and the like; and
|
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3.
|
discretionary bonus awards payable in cash and or securities of the Company tied to the satisfaction of corporate objectives.
|
Process for Setting Executive Compensation
As we do not have Compensation
Committee, our Board will be responsible for developing and overseeing the implementation of our philosophy with respect to the compensation
of executives and for monitoring the implementation and results of the compensation philosophy to ensure compensation remains competitive,
creates proper incentives to enhance stockholder value and rewards superior performance. The Board will annually review and approve for
each named executive officer, and particularly with regard to the Chief Executive Officer, all components of the executive’s compensation.
The Board may award discretionary bonuses to each of the named executives, and reviews and approves the process and factors (including
individual and corporate performance measures and actual performance versus such measures) used by the Chief Executive Officer to recommend
such awards. Additionally, the Board will review and approve the base salary, equity-incentive awards (if any) and any other special or
supplemental benefits of the named executive officers.
We expect out Chief Executive
Officer to periodically provide the Board with an evaluation of each named executive officer’s performance, based on the individual
performance goals and objectives developed by the Chief Executive Officer at the beginning of the year, as well as other factors. The
Board will provide an evaluation for the Chief Executive Officer. These evaluations will serve as the bases for bonus recommendations
and changes in the compensation arrangements of our named executives.
Our Compensation Peer Group
We expect to engage in informal
market analysis in evaluating our executive compensation arrangements. As the Company and its businesses mature, we may retain compensation
consultants that will assist us in developing a formal benchmark and selecting a compensation peer group of companies similar to us in
size or business for the purpose of comparing executive compensation levels.
Program Components
We expect our executive compensation
program to consist of the following elements:
Base Salary
Our base salary structure
will be designed to encourage internal growth, attract and retain new talent, and reward strong leadership that will sustain our growth
and profitability. The base salary for each named executive officer will reflect our past and current operating profits, the named executive
officer’s individual contribution to our success throughout his career, internal pay equity and informal market data regarding comparable
positions within similarly situated companies. In determining and setting base salary, the Board will consider all of these factors, though
it will not assign specific weights to any factor. The Board will generally review the base salary for each named executive officer on
an annual basis. For each of our named executive officers, we expect to review base salary data internally obtained by the Company for
comparable executive positions in similarly situated companies to ensure that the base salary rate for each executive is competitive relative
to the market.
Discretionary Bonus
The objectives of our bonus
awards will be to encourage and reward our employees, including the named executive officers, who contribute to and participate in our
success by their ability, industry, leadership, loyalty or exceptional service and to recruit additional executives who will contribute
to that success.
Each of our named executive
officers will be eligible for consideration for a discretionary cash bonus. The Chief Executive Officer will make recommendations regarding
bonus awards for the named executive officers and the Board provides the bonus recommendation for the Chief Executive Officer. However,
the Board/Compensation Committee will have sole and final authority and discretion in designating to whom awards are made, the size of
the award, if any, and its terms and conditions. The bonus recommendation for each of the named executive officers depends on a number
of factors, including (i) the performance of the Company for the year, (ii) the satisfaction of certain individual and corporate
performance measures, and (iii) other factors which the Board may deem relevant. The Company did not award any cash bonuses during
fiscal year 2021.
Stock Holdings
The Board recognizes the importance
of having a portion of the named executive officers’ compensation be paid in the form of equity, to help align the executives’
interests with the interests of the Company’s stockholders. Initially, we expect the Board to emphasize the cash-based portion of
our compensation program over a stock program because it believes the discretionary nature of the cash-based compensation gives it the
needed flexibility to factor in and reward the attainment of longer-term goals for the Company and the executives, as the Board deems
appropriate.
We have not timed nor do we
plan to time our release of material non-public information for the purpose of affecting the value of executive compensation.
Summary Compensation Table
The following summary compensation
table sets forth the aggregate compensation we paid or accrued during the fiscal years ended March 31, 2021and 2020 to (i) our Chief Executive
Officer (principal executive officer), (ii) our two most highly compensated executive officers other than the principal executive officer
who were serving as executive officers on March 31, 2021 whose total compensation was in excess of $100,000, and (iii) up to two additional
individuals who would have been within the two-other-most-highly compensated but were not serving as executive officers on March 31, 2021.
Name and Principal Position
|
|
Fiscal
Year
|
|
|
Salary
($)
|
|
|
Bonus
($)
|
|
|
Equity
Awards
($)
|
|
|
All Other
Compensation ($)
|
|
|
Total
($)
|
|
Eldee Tang
Chief Executive Officer, Interim Chief Financial Officer, Interim Chief Corporate Officer, Interim Secretary and
|
|
|
2021*
|
|
|
|
US$117,887
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
US$117,887
|
|
Director (1)
|
|
|
2020
|
|
|
|
US$182,016
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
US$182,016
|
|
*Eldee Tang’s salary from April 2020 to August 2020 (US$73,605)
was deferred and remained unpaid as of today. This amount is accrued and included in the salary of US$117,887.
(1)
|
Eldee Tang, our Chief Executive Officer and Director, was appointed Interim
Chief Financial Officer on June 21, 2019, and Interim Chief Corporate Officer and Interim Secretary on March 31, 2021.
|
Narrative disclosure to Summary Compensation
Eldee Tang is party to an employment agreement with NVPL, our subsidiary,
or the Employment Agreement as of the dates and for the annual salary set forth below:
Name
|
|
Position
|
|
Monthly Salary
(Singapore Dollars) / USD
|
|
Effective Date
|
Eldee Tang
|
|
Chief Executive Officer, Interim Chief Financial Officer, Interim Chief Corporate Officer, Interim Secretary and Director
|
|
SGD$20,000 / US$14,085
|
|
April 1, 2018 to August 31, 2020
|
|
|
|
|
SGD$7,020 / US$5,230
|
|
September 1, 2020
|
In addition to the base salary
set forth above, Mr. Tang may be entitled to quarterly bonuses based upon performance indicators established by the company.
Mr. Tang may terminate his
respective employment agreement by giving two months prior written notice thereof. NVPL is entitled to reduce the termination period by
offsetting against the employment amounts due. NVPL may terminate the employment of Mr. Tang in the case of dishonesty, willful or gross
misconduct, violation of house rules, gross incompetence or persistent breach of any terms of employment.
Mr. Tang is entitled to reimbursement
for reasonable travel and other out-of-pocket expenses incurred in connection with their services on our behalf. Mr. Tang is also entitled
to certain health and welfare benefits, transportation allowances, and relevant professional membership fees and course fees.
The foregoing description
of the Employment Agreement of Mr. Tang is qualified in its entirety by reference to such agreement which is filed as Exhibit 10.14 to
this Annual Report and is incorporated herein by reference.
Other than set out above and
below, there are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers.
We expect to establish one or more incentive compensation plans in the future. Our directors and executive officers may receive securities
of the Company as incentive compensation at the discretion of our board of directors in the future. We do not have any material bonus
or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers.
Equity Awards
There are no unvested options,
warrants or convertible securities outstanding.
At no time during the last
fiscal year with respect to any of any of our executive officers was there:
|
·
|
any outstanding option or other equity-based award repriced or otherwise materially modified (such as by extension of exercise periods, the change of vesting or forfeiture conditions, the change or elimination of applicable performance criteria, or the change of the bases upon which returns are determined;
|
|
·
|
any waiver or modification of any specified performance target, goal or condition to payout with respect to any amount included in non-stock incentive plan compensation or payouts;
|
|
·
|
any option or equity grant;
|
|
·
|
any non-equity incentive plan award made to a named executive officer;
|
|
·
|
any nonqualified deferred compensation plans including nonqualified defined contribution plans; or
|
|
·
|
any payment for any item to be included under All Other Compensation in the Summary Compensation Table.
|
Compensation of Directors
During our fiscal year ended
March 31, 2021, we did not provide compensation to any of our directors for serving as our director. We currently have no formal plan
for compensating our directors for their services in their capacity as directors, although we may elect to issue stock options to such
persons from time to time. Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in
connection with attendance at meetings of our board of directors. Our board of directors may award special remuneration to any director
undertaking any special services on our behalf other than services ordinarily required of a director.
Compensation Risk Management
Our Board of directors and
human resources staff conducted an assessment of potential risks that may arise from our compensation programs. Based on this assessment,
we concluded that our policies and practices do not encourage excessive and unnecessary risk taking that would be reasonably likely to
have material adverse effect on the Company. The assessment included our cash incentive programs, which awards non-executives with cash
bonuses for punctuality; and deferred salaries or delayed payments of salaries are accrued timely in the financials of the Company. The
Company is still obliged to pay deferred salaries to all affected employees, both present and former employees. Our compensation programs
are substantially identical among business units, corporate functions and global locations (with modifications to comply with local regulations
as appropriate). The risk-mitigating factors considered in this assessment included:
|
·
|
the alignment of pay philosophy, peer group companies and compensation amounts relative to local competitive practices to support our business objectives; and
|
|
·
|
effective balance of cash, short- and long-term performance periods, caps on performance-based award schedules and financial metrics with individual factors and Board and management discretion.
|
Compensation Committee Interlocks and Insider
Participation
We have not yet established
a Compensation Committee. Our Board of Directors performs the functions that would be performed by a compensation committee. Our board
of directors is comprised of Eldee Tang, our Chief Executive Officer, Interim Chief Financial Officer and Interim Secretary.
During the fiscal year ended
March 31, 2021, none of our executive officers has served: (i) on the compensation committee (or other board committee performing equivalent
functions or, in the absence of any such committee, the entire board of directors) of another entity, one of whose executive officers
served on our board of directors; or (ii) as a director of another entity, one of whose executive officers served on the compensation
committee (or other board committee performing equivalent functions or, in the absence of any such committee, the entire board of directors)
of the registrant.
Compensation Committee Report
Our board of directors has
reviewed and discussed the Compensation Discussion and Analysis in this report with management. Based on its review and discussion with
management, the board of directors recommended that the Compensation Discussion and Analysis be included in this Annual Report on Form
10-K for the year ended March 31, 2021. The material in this report is not deemed filed with the SEC and is not incorporated by reference
in any of our filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made on,
before, or after the date of this Report on Form 10-K and irrespective of any general incorporation language in such filing.
Submitted by the board of directors:
Eldee Tang
ITEM 12. Security Ownership
of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table sets
forth, as of June 17, 2021, certain information with regard to the record and beneficial ownership of the Company’s common stock
by (i) each person known to the Company to be the record or beneficial owner of 5% or more of the Company’s common stock, (ii)
each director of the Company, (iii) each of the named executive officers, and (iv) all executive officers and directors of the Company
as a group:
Name of Beneficial Owner (1)
|
|
Amount
(number of shares)
|
|
|
Percentage of Outstanding Shares of Common Stock (2)
|
|
|
|
|
|
|
|
|
Eldee Tang (3)
|
|
|
118,661,647
|
|
|
|
56.3%
|
|
|
|
|
|
|
|
|
|
|
All executive officers and directors as a group (two persons)
|
|
|
118,661,647
|
|
|
|
56.3%
|
|
|
|
|
|
|
|
|
|
|
5% or more shareholders
|
|
|
|
|
|
|
|
|
Venvici Partners Ltd. (4)(5)
|
|
|
11,213,141
|
|
|
|
5.3%
|
|
Leow Yoon Liang (4)(5)
|
|
|
15,000,000
|
|
|
|
7.4%
|
|
(1)
|
Except as otherwise indicated, the address of each beneficial owner is c/o Noble Vici Group, Inc., 45 Ubi Crescent, Singapore 408590.
|
(2)
|
Applicable percentage ownership
is based on 210,804,160 shares of common stock outstanding as of June 17, 2021, together with securities exercisable or convertible
into shares of common stock within 60 days of June 17, 2021. Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or investment power with respect to securities. Shares of common
stock that a person has the right to acquire beneficial ownership of upon the exercise or conversion of options, convertible stock,
warrants or other securities that are currently exercisable or convertible or that will become exercisable or convertible within
60 days of June 17, 2021, are deemed to be beneficially owned by the person holding such securities for the purpose of computing
the number of shares beneficially owned and percentage of ownership of such person, but are not treated as outstanding for the purpose
of computing the percentage ownership of any other person.
|
(3)
|
Eldee Tang was appointed the Chief Executive Officer and director of the
Company effective March 27, 2018, interim Chief Financial Officer effective June 21, 2019, and interim Secretary and Chief Corporate Officer
effective March 31, 2021.
|
(4)
|
Venvici Partners Ltd. (VPL) serves as trustee and nominee to hold, administer and distribute 11,213,141 shares of the Issuer's common stock on behalf of certain sales team members of the Issuer on June 2, 2020, which the sales team members are beneficial owners of these securities. The issuance of these securities was disclosed on a Current Report on Form 8-K filed with the Securities and Exchange Commission on March 11, 2019. The replacement of the Reporting Person is disclosed on Form 3 filed with the Securities and Exchange Commission on June 5, 2020.
|
(5)
|
Leow Yoon Liang is the sole shareholder and director of VPL. Leow Yoon Liang was appointed to replace Venvici Partners Limited as trustee and nominee to hold, administer and distribute 15,000,000 shares of the Issuer's common stock on behalf of certain sales team members of the Issuer on June 2, 2020, in which the sales team members are beneficial owners of these securities. The issuance of these securities was disclosed in Current Report on Form 8-K filed with the Securities and Exchange Commission on March 11, 2019.
|
ITEM 13. Certain Relationships
and Related Transactions, and Director Independence.
Other than as disclosed below,
there are no transactions during our two most recent fiscal years ended March 31, 2021 and March 31, 2020, or any currently proposed transaction,
in which our Company was or to be a participant and the amount exceeds the lesser of $120,000 or one percent of the average of our Company’s
total assets at year end for our last two completed years, and in which any of our directors, officers or principal stockholders, or any
other related person as defined in Item 404 of Regulation S-K, had or have any direct or indirect material interest.
From time to time, our shareholders
advance funds to the Company on an unsecured, non-interest bearing basis, which funds have no fixed terms of payment. As of March 31,
2021 and March 31, 2020, Ms. Kao Wei-Chen, our shareholder, advanced $280,317, all of which is outstanding.
Transactions With Eldee
Tang
During the years ended March
31, 2021, and 2020, we made payments to the related parties as follow:
|
|
March 31, 2021
|
|
|
March 31, 2021
|
|
Vendor
|
|
Amount for the year
|
|
|
Accounts Payable
|
|
|
|
|
|
|
|
|
|
|
Barista Uno Private Limited
|
|
$
|
275,071
|
|
|
$
|
127,574
|
|
Elusyf Global Private Limited
|
|
$
|
10,487
|
|
|
|
10,480
|
|
|
|
March 31, 2020
|
|
|
March 31, 2020
|
|
Vendor
|
|
Amount for the year
|
|
|
Accounts Payable
|
|
Barista Uno Private Limited
|
|
$
|
3,601,886
|
|
|
$
|
130,169
|
|
|
|
|
|
|
|
|
|
|
Eldee Tang, our Chief Executive
Officer and Director, owns 31% of Barista Uno Private Limited.
Purchase from a related company totaled
$285,558 and $3,601,886, for the years ended March 31, 2021 and 2020. These purchases mainly relate to purchases from Barista Uno Private
Limited (“BU”) of $275,071 and Elusyf Global Private Limited (“EG”) of $10,487 for the year ended March 31, 2021.
For the year ended March 31, 2020, purchases of $3,601,886 were paid to BU. Eldee Tang owns 31% of BU and 50% of EG.
|
|
March 31, 2021
|
|
|
March 31, 2020
|
|
Royalty Charges and Marketing Expenses
|
|
Amount for the year
|
|
|
Amount for the year
|
|
|
|
|
|
|
|
|
|
|
Barista Uno Private Limited
|
|
$
|
57,851
|
|
|
$
|
|
|
Elusyf Global Private Limited
|
|
$
|
6,377
|
|
|
$
|
|
|
Innovez Capital Private Limited
|
|
$
|
24,585
|
|
|
$
|
|
|
Venvici Limited
|
|
$
|
|
|
|
$
|
115,139
|
|
Royalty charges and marketing
expenses paid to a related company totaled $88,813 and $115,139, for the years ended March 31, 2021 and 2020. For the year ended March
31, 2021, royalty charges and marketing expenses were paid to UB45 Pte Ltd (“UB45”) and Noble Vici Ptd Ltd (“NVPL”).
These expense are mainly from BU, EG and Innovez Capital Private Limited (“Innovez”). Eldee Tang holds 49% shareholdings
in Innovez. For the year ended March 31, 2020, royalty charges and marketing expenses were paid to Venvici Limited where Eldee Tang is
a director.
From time to time, Eldee Tang,
our Chief Executive Officer, Interim Chief Financial Officer, Interim Secretary and Director, advances funds to the Company for working
capital purposes. Those advances are unsecured, non-interest bearing and has no fixed terms of payment. The imputed interest on the loan
from a related party was not significant. As of March 31, 2021 and 2020 the Company owed Eldee Tang a balance of $1,488,322 and $17,662
respectively.
We have not adopted policies
or procedures for approval of related person transactions but review them on a case-by-case basis. We believe that all related party transactions
were on terms at least as favorable as we would have secured in arm’s-length transactions with third parties. Except as set forth
above, we have not entered into any material transactions with any director, executive officer, and promoter, beneficial owner of five
percent or more of our common stock, or family members of such persons.
Director Independence
Our board of directors currently
consists of Eldee Tang, our Chief Executive Officer, Interim Chief Financial Officer and Interim Secretary, who does not qualify as an
independent director under the published listing requirements of the NASDAQ Stock Market or the NYSE. As of the date hereof, we have not
adopted a standard of independence nor do we have a policy with respect to independence requirements for our board members or that a majority
of our board be comprised of “independent directors.”
ITEM 14. Principal AccountING
Fees And Services.
J&S Associate (“J&S”)
audited our financial statements for the fiscal years ended March 31, 2021 while Exelient PAC (“Exelient”) audited our financial
statements for the fiscal years ended March 31, 2020.
All audit work was performed
by J&S and Exelient for the above mentioned fiscal years 2021 and 2020 respectively. Our board of directors does not have an audit
committee. The functions customarily delegated to an audit committee are performed by our full board of directors. Our board of directors
approves in advance, all services performed by J&S, but have not adopted pre-approval policies or procedures. Our board of directors
has considered whether the provision of non-audit services is compatible with maintaining the principal accountant’s independence,
and has approved such services.
The following table sets forth
fees billed by our auditors during the last two fiscal years for services rendered for the audit of our annual financial statements and
the review of our quarterly financial statements, services by our auditors that are reasonably related to the performance of the audit
or review of our financial statements and that are not reported as audit fees, services rendered in connection with tax compliance, tax
advice and tax planning, and all other fees for services rendered.
|
|
March 31, 2021
|
|
|
March 31, 2020
|
|
|
|
|
|
|
|
|
Audit fees
|
|
$
|
40,225
|
|
|
$
|
126,133
|
|
Audit related fees
|
|
|
–
|
|
|
|
–
|
|
Tax fees
|
|
|
–
|
|
|
|
–
|
|
All other fees
|
|
|
–
|
|
|
|
–
|
|
Total
|
|
$
|
40,225
|
|
|
|
126,133
|
|
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
1. DESCRIPTION
OF BUSINESS AND ORGANIZATION
Noble Vici Group, Inc. (the “Company”),
formerly known as Gold Union Inc., was incorporated under the laws of the State of Delaware on July 6, 2010 under the name of Advanced
Ventures Corp. Effective January 6, 2014, the Company changes its name to “Gold Union Inc.” Effective March 26, 2020, the
Company changes its current name to Noble Vici Group, Inc (“NVGI”).
The Company is currently engaged in the IoT, Big
Data, Blockchain and E-commerce business.
Description of subsidiaries
Name
|
|
Place of incorporation
and kind of
legal entity
|
|
Principal activities
and place of operation
|
|
Particulars of issued/
registered share
capital
|
|
Effective interest
held
|
|
|
|
|
|
|
|
|
|
Noble Vici Pte Ltd
|
|
Republic of Singapore
|
|
Singapore holding company
|
|
SGD$200,001
|
|
100%
|
|
|
|
|
|
|
|
|
|
NIApplications Pte Ltd
|
|
Republic of Singapore
|
|
Development of software for interactive digital media and software consultancy
|
|
SGD$1
|
|
100%
|
|
|
|
|
|
|
|
|
|
Noble Digital Apps Sendirian Berhad
|
|
Federation of Malaysia
|
|
Digital apps and big data business
|
|
MYR1,000
|
|
51%
|
|
|
|
|
|
|
|
|
|
The Digital Agency Pte. Ltd.
|
|
Republic of Singapore
|
|
Business and management consultancy services
|
|
SGD$1
|
|
51%
|
|
|
|
|
|
|
|
|
|
Venvici Ltd
|
|
Republic of Seychelles
|
|
Business and management consultancy services on e-commerce service
|
|
US$50,000
|
|
100%
|
|
|
|
|
|
|
|
|
|
Ventrepreneur (SG) Pte Ltd
|
|
Republic of Singapore
|
|
Online retailing
|
|
SGD$10,000
|
|
100%
|
|
|
|
|
|
|
|
|
|
Ventrepreneur (SG) Pte Ltd, Taiwan Branch
|
|
Taiwan Branch
|
|
Customer service for ecommerce and merchants servicing
|
|
N/A
|
|
N/A
|
|
|
|
|
|
|
|
|
|
UB45 Pte Limited
|
|
Republic of Singapore
|
|
Investment holding
|
|
SGD$10,000
|
|
100%
|
|
|
|
|
|
|
|
|
|
VMore System Private Limited
|
|
Republic of Singapore
|
|
IoT Retailing
|
|
SGD$10,000
|
|
100%
|
|
|
|
|
|
|
|
|
|
VMore Holding Limited
|
|
New Zealand
|
|
Investment holding
|
|
NZ$10,000
|
|
100%
|
|
|
|
|
|
|
|
|
|
VMore Merchants Pte Ltd
|
|
Republic of Singapore
|
|
Merchants onboarding
|
|
SGD$1,000
|
|
100%
|
|
|
|
|
|
|
|
|
|
AIM System Pte Ltd
|
|
Republic of Singapore
|
|
System provider
|
|
SGD$1,000
|
|
100%
|
The Company and its subsidiaries are hereinafter
referred to as (the “Company”).
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
2. GOING
CONCERN UNCERTAINTIES
The accompanying consolidated financial statements
have been prepared using the going concern basis of accounting, which contemplates the realization of assets and the satisfaction of liabilities
in the normal course of business.
As of March 31, 2021, the Company suffered from
an accumulated deficit of $139,375,793 and working capital deficit of $5,241,539. The continuation of the Company as a going concern through
March 31, 2022 is dependent upon the continued financial support from its stockholders and funding from existing shareholders
and financial institution, as mentioned above. Management believes the Company is currently pursuing additional financing for its substantial
deployment of VX machines and seeking new partnerships regionally. However, there is no assurance that the Company will be successful
in securing sufficient funds to sustain the operations.
With respect to the ongoing and evolving coronavirus
(COVID-19) outbreak, which was designated as a pandemic by the World Health Organization on March 11, 2020, the outbreak has caused substantial
disruption in international economies and global trades and if repercussions of the outbreak are prolonged, could have a significant adverse
impact on the Company’s business. These and other factors raise substantial doubt about the Company’s ability
to continue as a going concern. These consolidated financial statements do not include any adjustments to reflect the possible future
effects on the recoverability and classification of assets and liabilities that may result in the Company not being able to continue as
a going concern.
3. SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying consolidated financial statements
reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying consolidated
financial statements and notes.
These accompanying consolidated financial statements
have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).
The consolidated financial statements include
the accounts of the Company and its subsidiaries. All significant inter-company balances and transactions within the Company have been
eliminated upon consolidation.
|
l
|
Use of estimates and assumptions
|
In preparing these consolidated financial statements,
management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues
and expenses during the years reported. Actual results may differ from these estimates.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
|
l
|
Cash and cash equivalents
|
Cash and cash equivalents are carried at cost
and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an
original maturity of three months or less as of the purchase date of such investments.
Accounts receivable consist of amounts due from
customers in connection with our normal business activities and are carried at sales value less allowance for doubtful accounts. The allowance
for doubtful accounts is established to reflect the expected losses of accounts receivable based on past collection history, age, account
payment status compared to invoice payment terms and specific individual risks identified. The delinquency of a receivable account is
determined based on these factors. The Company does not accrue interest on aged accounts receivable. As of March 31, 2021 and 2020, there
were no allowances for doubtful accounts.
Inventories are stated at the lower of cost or
net realizable value, with cost determined on a first-in first-out basis. At present all inventory relates to finished goods for commercial
sales.
Purchase deposits represent deposit payments made
to vendors for procurement, which are interest-free, unsecured and relieved against accounts payable when goods are received by the Company,
or refundable in the next twelve months.
Intangible assets represented the acquired game
right from a related party, which are stated at acquisition cost, less accumulated amortization. The Company amortizes its intangible
assets with definite lives over their estimated useful lives and reviews these assets for impairment when an indicator for potential impairment
exists. The Company is currently amortizing its intangible assets with definite lives over periods of 3 years.
|
l
|
Property, plant and equipment
|
Property, plant and equipment are stated at cost
less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the
following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual
values:
|
|
Expected useful lives
|
|
Building
|
|
38 years or lesser than term of lease
|
|
Leasehold improvements
|
|
3 - 10 years or lesser than term of lease
|
|
Furniture and fittings
|
|
3 years
|
|
Office equipment and computers
|
|
1- 5 years
|
|
Motor vehicle
|
|
3 - 3.33 years
|
|
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
Expenditures for repairs and maintenance are expensed
as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any
resulting gain or loss is recognized in the results of operations.
Depreciation expense for the years ended March
31, 2021 and 2020 were $249,807 and $226,743, as part of operating expenses, respectively.
|
l
|
Impairment of long-lived assets
|
In accordance with Accounting Standards Codification
("ASC") Topic 360-10-5, “Impairment or Disposal of Long-Lived Assets”, the Company reviews its long-lived
assets, including property, plant and equipment, as well as intangible assets for impairment whenever events or changes in circumstances
indicate that the carrying amount of the assets may not be fully recoverable or that useful lives are no longer appropriate. If the total
of the expected undiscounted future net cash flows is less than the carrying amount of the asset, a loss is recognized for the difference
between the fair value and carrying amount of the asset. There has been no impairment charge as of March 31, 2021 and 2020.
The Company adopted Accounting Standards Update
(“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). Under ASU 2014-09,
the Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its
obligations under each of its agreements:
·
|
identify the contract with a customer;
|
·
|
identify the performance obligations in the contract;
|
·
|
determine the transaction price;
|
·
|
allocate the transaction price to performance obligations in the contract; and
|
·
|
recognize revenue as the performance obligation is satisfied.
|
The Company accounts for a contract with a customer
when the contract is committed in writing, the rights of the parties, including payment terms, are identified, the contract has commercial
substance and consideration to collect is substantially probable.
The Company continues to derive its revenues from sales contracts with its customers with revenues being recognized upon delivery
of products. Persuasive evidence of an arrangement is demonstrated via sales contract and invoice; and the sales price to the customer
is fixed upon acceptance of the sales contract and there is no separate sales rebate, discount, or volume incentive. The Company recognizes
revenue when the Company has the rights to perform the deployment and maintenance service on machines. The Company’s revenues are
recognized at a point in time after all performance obligations are satisfied.
The Company records revenues from the sales of
third-party products on a “gross” basis pursuant to ASC 605-45 Revenue Recognition - Principal Agent Considerations,
when we are the primary obligor in the arrangement with the end customer and have the risks and rewards as principal in the transaction,
such as responsibility for fulfillment, retaining the risk for collection, and establishing the price of the products. If these indicators
have not been met, or if indicators of net revenue reporting specified in ASC 605-45 are present in the arrangement, revenue is recognized
net of related direct costs.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
Product sales are recorded net of good and service
taxes and product returns.
Cost of revenue consists primarily of the cost
of goods sold and royalty expenses to the game owners, which are directly attributable to the sales of products and the rendering of online
gaming service.
Sales and marketing expenses include payroll,
employee benefits and other headcount-related expenses associated with sales and marketing personnel, and the costs of advertising, promotions,
seminars, and other programs.
The Company maintains a membership program, whereby
certain members earn commission credits, based on the sales volume of certain other members who are sponsored directly or indirectly by
the member. Commission credits are redeemable on future spending of the products purchased or playing online games. Commission credits
are recorded and classified as operating expense when the products are delivered and revenue is recognized. The estimated liability for
unredeemed commission credit is included in commission liability on the accompanying balance sheets. Management reviews the adequacy for
the accrual for unredeemed commission credits by periodically evaluating the historical redemption and projected trends.
|
l
|
Deferred revenue and costs
|
Deferred revenue and deferred cost of goods
sold result from transactions where the Company has shipped product for which all revenue recognition criteria under the five-step
model have not yet been met. Though these contracts are not considered a contract under ASC 606, they are legally enforceable, and
the Company has an unconditional and immediate right to payment after the Company has received the orders from customers, therefore,
the Company recognizes a receivable and a corresponding deferred revenue upon receiving the orders. Deferred cost of goods sold includes
direct inventory costs. Once all revenue recognition criteria under the five-step model have been met, the Revenues and associated cost of goods sold will be recognized in
the Income Statement.
The Company adopted the ASC 740 Income tax
provisions of paragraph 740-10-25-13, which addresses the determination of whether tax benefits claimed or expected to be claimed on a
tax return should be recorded in the consolidated financial statements. Under paragraph 740-10-25-13, the Company may recognize the tax
benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the
taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements
from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized
upon ultimate settlement. Paragraph 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income
taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for
unrecognized income tax benefits according to the provisions of paragraph 740-10-25-13.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
The estimated future tax effects of temporary
differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs
and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides
valuation allowances as management deems necessary.
|
l
|
Uncertain tax positions
|
The Company did not take any uncertain tax positions
and had no adjustments to its income tax liabilities or benefits pursuant to the ASC 740 provisions of Section 740-10-25 for the years
ended March 31, 2021 and 2020.
The Company adopted Topic 842, Leases (“ASC
842”), using the modified retrospective approach through a cumulative-effect adjustment and utilizing the effective date of January
1, 2017 as its date of initial application.
The Company determines if an arrangement is a
lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities,
and operating lease liabilities in our consolidated balance sheets. Finance leases are included in property and equipment, other current
liabilities, and other long-term liabilities in our consolidated balance sheets.
ROU assets represent the right to use an underlying
asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease
ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most
of the Company’s leases do not provide an implicit rate, the Company generally use the incremental borrowing rate based on the estimated
rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU
asset also includes any lease payments made and excludes lease incentives. The lease terms may include options to extend or terminate
the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line
basis over the lease term.
In accordance with the guidance in ASC 842, components
of a lease should be split into three categories: lease components (e.g. land, building, etc.), non-lease components (e.g. common area
maintenance, consumables, etc.), and non-components (e.g. property taxes, insurance, etc.). Subsequently, the fixed and in-substance fixed
contract consideration (including any related to non-components) must be allocated based on the respective relative fair values to the
lease components and non-lease components.
|
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|
Foreign currencies translation
|
Transactions denominated in currencies other than
the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction.
Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency
using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the consolidated statement
of operations.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
The reporting currency of the Company is United
States Dollar ("US$") and the accompanying consolidated financial statements have been expressed in US$. In addition, the Company’s
operating subsidiaries in Singapore and Seychelles maintain their books and record in its local currency, Singapore Dollars (“SGD$”),
which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In
general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not US$ are translated into
US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance
sheet date. Revenues and expenses are translated at average rates prevailing during the year. The gains and losses resulting from translation
of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within
the statements of changes in stockholder’s equity.
Translation of amounts from SGD$ into US$1 has been
made at the following exchange rates for the years ended March 31, 2021 and 2020:
|
|
March 31, 2021
|
|
|
March 31, 2020
|
|
Year-end SGD$:US$1 exchange rate
|
|
|
1.3472
|
|
|
|
1.4236
|
|
Annual average SGD$:US$1 exchange rate
|
|
|
1.3423
|
|
|
|
1.3713
|
|
ASC Topic 220, “Comprehensive Income”,
establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income
as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented
in the accompanying consolidated statements of changes in stockholders’ equity, consists of changes in unrealized gains and losses
on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.
ASC Topic 280, “Segment Reporting”
establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization
structure as well as information about geographical areas, business segments and major customers in consolidated financial statements.
For the years ended March 31, 2021 and 2020, the Company operates in one reportable operating segment in Singapore and Asian Region.
Contributions to retirement plans (which are defined
contribution plans) are charged to general and administrative expenses in the accompanying statements of operation as the related employee
service is provided.
The Company follows the ASC 850-10, Related
Party for the identification of related parties and disclosure of related party transactions.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
Pursuant to section 850-10-20 the related parties
include a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the
election of the fair value option under the Fair Value Option Subsection of section 825–10–15, to be accounted for by the
equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are
managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other
parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the
other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other
parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest
in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might
be prevented from fully pursuing its own separate interests.
The consolidated financial statements shall include
disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items
in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined
financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved;
b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods
for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions
on the consolidated financial statements; c) the dollar amounts of transactions for each of the periods for which income statements
are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amount
due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of
settlement.
|
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|
Commitments and contingencies
|
The Company follows the ASC 450-20, Commitments
to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result
in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such
contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal
proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the
perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected
to be sought therein.
If the assessment of a contingency indicates that
it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would
be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not
probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate
of the range of possible losses, if determinable and material, would be disclosed.
Loss contingencies considered remote are generally
not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon
information available at this time that these matters will have a material adverse effect on the Company’s financial position, results
of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s
business, financial position, and results of operations or cash flows.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
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|
Fair value of financial instruments
|
The Company follows paragraph 825-10-50-10 of
the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37
of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments.
Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a framework for measuring fair value in generally accepted
accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair
value measurements and related disclosures, paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a fair value
hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value
hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest
priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting
Standards Codification are described below:
Level 1
|
|
Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
|
|
|
|
Level 2
|
|
Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
|
|
|
|
Level 3
|
|
Pricing inputs that are generally observable inputs and not corroborated by market data.
|
Financial assets are considered Level 3 when their
fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant
model assumption or input is unobservable.
The fair value hierarchy gives the highest priority
to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If
the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is
based on the lowest level input that is significant to the fair value measurement of the instrument.
The carrying amounts of the Company’s financial
assets and liabilities, such as cash and cash equivalents, approximate their fair values because of the short maturity of these instruments.
|
l
|
Recent accounting pronouncements
|
The Company has reviewed all recently issued,
but not yet effective, accounting pronouncements and do now believe the future adoption of any such pronouncements may be expected to
cause a material impact on its financial condition or the results of its operations.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
4. REVENUE
|
|
Years ended March 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
|
|
|
|
|
|
Products sales, as principal
|
|
$
|
2,820,056
|
|
|
$
|
11,261,390
|
|
Other operating revenue
|
|
|
254,664
|
|
|
|
2,144,109
|
|
|
|
$
|
3,074,720
|
|
|
$
|
13,405,499
|
|
5. DEFERRED
COSTS
As of March 31, 2021 and 2020, the Company had
total deferred costs of $3,160,539 and $4,252,107, respectively. The deferred cost will be expensed off to Cost of Good Sold in Income Statement when
the corresponding deferred revenue is recognized.
6. PROPERTY,
PLANT AND EQUIPMENT
Property, plant and equipment consisted of the
following:
|
|
As of March 31,
|
|
|
|
2021
|
|
|
2020
|
|
At cost:
|
|
|
|
|
|
|
|
|
Building
|
|
$
|
3,421,170
|
|
|
$
|
3,237,510
|
|
Leasehold improvement
|
|
|
252,723
|
|
|
|
239,156
|
|
Furniture and fittings
|
|
|
30,549
|
|
|
|
28,909
|
|
Office equipment and computers
|
|
|
158,426
|
|
|
|
147,654
|
|
Motor vehicle
|
|
|
212,971
|
|
|
|
99,043
|
|
Right of used assets
|
|
|
86,031
|
|
|
|
81,413
|
|
|
|
|
4,161,870
|
|
|
|
3,833,685
|
|
Less: accumulated depreciation
|
|
|
(591,660
|
)
|
|
|
(366,158
|
)
|
|
|
$
|
3,570,210
|
|
|
$
|
3,467,527
|
|
Depreciation expense for the years ended March
31, 2021 and 2020 were $249,807 and $226,743, as part of operating expenses, respectively.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
7. INTANGIBLE
ASSETS
|
|
As of March 31,
|
|
|
|
2021
|
|
|
2020
|
|
Gaming right and software:
|
|
|
|
|
|
|
|
|
Gross carrying value
|
|
$
|
6,903
|
|
|
$
|
6,533
|
|
Less: accumulated amortization
|
|
|
(2,685
|
)
|
|
|
(363
|
)
|
|
|
|
|
|
|
|
|
|
Intangible assets, net
|
|
$
|
4,218
|
|
|
$
|
6,170
|
|
Amortization expense for the years ended March
31, 2021 and 2020 were $2,309 and $273,790, as part of operating expenses, respectively.
The following table outlines the annual amortization
expense for the next two years:
Years ending March 31:
|
|
|
|
2022
|
|
$
|
2,301
|
|
2023
|
|
|
1,917
|
|
|
|
|
|
|
Total
|
|
$
|
4,218
|
|
8. DEFERRED
REVENUE
As of March 31, 2021 and 2020, the Company had total deferred revenue
of $4,085,010 and $6,239,296, respectively. The deferred revenue will be recognized upon the Company has the rights to perform the deployment
and maintenance service on machines
9. AMOUNT
DUE TO A DIRECTOR
As of March 31, 2021 and 2020, the Company owed
the amount of $1,448,322 and $17,662 due to a director of the Company, Mr. TANG Wai Chong Eldee. The balance is unsecured, interest-free
and has no fixed terms of repayment. Imputed interest from related party loan is not significant.
10. AMOUNT
DUE TO A RELATED PARTY
As of March 31, 2021 and 2020, the Company
owed the amount of $280,317 due to a shareholder of the Company, Miss KaoWei-Chen. The balance is unsecured,
interest-free and has no fixed terms of repayment. Imputed interest from related parties’ loan is not significant.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
11. BORROWINGS
|
|
As of
|
|
|
|
March 31, 2021
|
|
|
March 31, 2020
|
|
Current portion
|
|
|
|
|
|
|
|
|
Loan
|
|
$
|
312,797
|
|
|
$
|
220,283
|
|
Lease liabilities
|
|
|
48,150
|
|
|
|
36,475
|
|
|
|
|
360,947
|
|
|
|
256,758
|
|
|
|
|
|
|
|
|
|
|
Non-current portion
|
|
|
|
|
|
|
|
|
Loan
|
|
|
1,513,064
|
|
|
|
1,652,120
|
|
Lease liabilities
|
|
|
68,066
|
|
|
|
40,365
|
|
|
|
|
1,581,130
|
|
|
|
1,692,485
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,942,077
|
|
|
$
|
1,949,243
|
|
The loan is secured by a mortgage over a leasehold
building. The loan bears interest rate of 3.75% flat per annum and is repayable in 120 equal month installments commencing from October
1, 2018. The loan is personally guaranteed by the director of the Company, Eldee Tang.
The Company has financed its motor vehicles, office
premises and office equipment under finance lease agreements with the fixed interest rate ranging from 2.80% to 7.98% per annum, due through
2020 and 2026, with principal and interest payable monthly. These leases have remaining lease terms of 12 months to 90 months.
Right of use assets are included in the condensed
consolidated balance sheet are as follows:
|
|
As of
|
|
|
|
March 31, 2021
|
|
|
March 31, 2020
|
|
Non-Current assets
|
|
|
|
|
|
|
|
|
Right-of-use assets, net of amortization (included in property, plant and equipment)
|
|
$
|
159,841
|
|
|
$
|
95,368
|
|
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
The maturities of lease liabilities and loan are
as follows:
|
|
Lease liabilities
|
|
|
Loan
|
|
Years ending March 31:
|
|
|
|
|
|
|
|
|
2021
|
|
$
|
53,968
|
|
|
$
|
400,089
|
|
2022
|
|
|
49,048
|
|
|
|
320,071
|
|
2023
|
|
|
20,822
|
|
|
|
320,071
|
|
2024
|
|
|
4,872
|
|
|
|
320,071
|
|
2025
|
|
|
4,436
|
|
|
|
320,071
|
|
Thereafter
|
|
|
–
|
|
|
|
800,178
|
|
|
|
|
|
|
|
|
|
|
Total lease payments
|
|
|
133,146
|
|
|
|
2,480,551
|
|
Less: Imputed interest
|
|
|
(16,930
|
)
|
|
|
(654,690
|
)
|
Present value of lease liabilities
|
|
$
|
116,216
|
|
|
$
|
1,825,861
|
|
12. INCOME
TAX
The provision for income taxes consisted of the
following:
|
|
Years ended March 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
|
|
|
|
|
|
Current tax expense (credit)
|
|
$
|
1,272
|
|
|
$
|
(204,035
|
)
|
Deferred tax
|
|
|
–
|
|
|
|
–
|
|
Income tax expense (credit)
|
|
$
|
1,272
|
|
|
$
|
(204,035
|
)
|
The effective tax rate in the years presented
is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. The Company and its
subsidiaries are mainly operated in Republic of Singapore and Republic of Seychelles that are subject to taxes in the jurisdictions in
which they operate, as follows:
United States of America
NVGI is registered in the State of Delaware and
is subject to United States of America tax law. No provision for income taxes have been made as NVGI has generated no taxable income for
the periods presented. The Company’s policy is to recognize accrued interest and penalties related to unrecognized tax benefits
in its income tax provision. The Company has not accrued or paid interest or penalties which were not material to its results of operations
for the period presented.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
As of March 31, 2021, the Company incurred $1,870,621
of cumulative net operating losses which can be carried forward to offset future taxable income. The net operating loss carryforwards
begin to expire in 2041, if unutilized. The Company has provided for a full valuation allowance against the deferred tax assets of $392,830
on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely
than not that these assets will not be realized in the future.
New Zealand
The Company’s operating subsidiaries are
registered in New Zealand and are subject to the New Zealand corporate income tax at a standard income tax rate of 28% on the assessable
income arising in New Zealand during its tax year.
Federation of Malaysia
The Company’s operating subsidiaries are
registered in Federation of Malaysia and are subject to the Malaysia corporate income tax at a standard income tax rate of 24%
on the assessable income arising in Malaysia during its tax year.
Republic of Singapore
The Company’s operating subsidiaries are
registered in Republic of Singapore and are subject to the Singapore corporate income tax at a standard income tax rate of 17% on the
assessable income arising in Singapore during its tax year.
The Company’s subsidiary in Republic of
Seychelles is also subject to the Singapore corporate income tax regime.
The reconciliation of income tax rate to the effective
income tax rate based on (loss) income before income taxes for the years ended March 31, 2021 and 2020 are as follows:
|
|
Years ended March 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
|
|
|
|
|
|
(Loss) income before income taxes
|
|
$
|
(2,103,353
|
)
|
|
$
|
205,663
|
|
Statutory income tax rate
|
|
|
17%
|
|
|
|
17%
|
|
Income tax expense at statutory rate
|
|
|
(357,570
|
)
|
|
|
34,962
|
|
Tax effect of non-taxable income
|
|
|
(81,491
|
)
|
|
|
–
|
|
Tax effect of tax concession
|
|
|
–
|
|
|
|
(21,510
|
)
|
Tax effect of allowance
|
|
|
–
|
|
|
|
(217,487
|
)
|
Tax loss not recognized as deferred tax
|
|
|
440,333
|
|
|
|
–
|
|
Income tax expense (credit)
|
|
$
|
1,272
|
|
|
$
|
(204,035
|
)
|
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
The following table sets forth the significant
components of the deferred tax assets and liabilities of the Company as of March 31, 2021 and 2020:
|
|
As of March 31,
|
|
|
|
2021
|
|
|
2020
|
|
Deferred tax assets:
|
|
|
|
|
|
|
|
|
Net operating loss carryforwards
|
|
$
|
740,303
|
|
|
$
|
373,043
|
|
Less: valuation allowance
|
|
|
(740,303
|
)
|
|
|
(373,043
|
)
|
Deferred tax assets, net
|
|
$
|
–
|
|
|
$
|
–
|
|
As of March 31, 2021, the Company incurred $2,212,490
of cumulative net operating losses which can be carried forward to offset future taxable income at no expiration. The Company has provided
for a full valuation allowance against the deferred tax assets of $740,303 and $373,043 at March 31, 2021 and 2020, on the expected future
tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not
be realized in the future.
The Company has filed an income tax return for
2019 and 2018 in Singapore jurisdiction.
13. STOCKHOLDERS’
DEFICIT
In October 2019, the Company issued 100,000 shares
of its common stock to its legal counsel for legal services provided to the Company at the fair value of $200,000, equal to $2 per share.
For the years ended March 31, 2021 and 2020, the
Company recorded share-based compensation expense related to restricted stock units issued to sales agents and consultants of $0 and $10,810,357,
respectively. This share-based compensation expense is included in general and administrative expenses and research and development expenses
in the accompanying consolidated statements of operations.
As of March 31, 2021 and 2020, the Company had
a total of 210,804,160 shares of its common stock issued and outstanding.
14. PENSION
COSTS
The Company is required to make contribution to
their employees under a government-mandated defined contribution pension scheme for its eligible full-times employees in Singapore. The
Company is required to contribute a specified percentage of the participants’ relevant income based on their ages and wages level.
During the years ended March 31, 2021 and 2020, $210,561 and $218,354 contributions were made accordingly.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
15. RELATED
PARTY TRANSACTIONS
From time to time, the stockholder and director
of the Company advanced funds to the Company for working capital purpose. Those advances are unsecured, non-interest bearing and due on
demand. The imputed interest on the loan from a related party was not significant.
Purchase from a related company totaled $285,558
and $984, for the years ended March 31, 2021 and 2020. These purchases mainly relate to purchases from Barista Uno Private Limited (“BU”)
and Elusyf Global Private Limited (“EG”). Eldee Tang owns 31% of BU and 50% of EG.
Royalty charges and marketing expenses paid to
a related company totaled $88,813 and $115,139, for the years ended March 31, 2021 and 2020. For the year ended March 31, 2021, royalty
charges and marketing expenses were paid to UB45 Pte Ltd (“UB45”) and Noble Vici Ptd Ltd (“NVPL”). These expense
are mainly from BU, EG and Innovez Capital Pte ltd (“IC”). Eldee Tang holds 49% shareholdings in IC. For the year ended March 31, 2020, royalty charges
and marketing expenses were paid to Venvici Limited where Eldee Tang is a director.
Apart from the transactions and balances detailed
elsewhere in these accompanying consolidated financial statements, the Company has no other significant or material related party transactions
during the periods presented.
16. CONCENTRATIONS
OF RISK
The Company is exposed to the following concentrations of risk:
(a) Major
customers
For the years ended March 31, 2021 and 2020, there
is no individual customer exceeding 10% of the Company’s revenue.
The Company considers its business activities
to constitute one single reportable segment. The Company’s chief operating decision makers use consolidated results to make operating
and strategic decisions. The geographic distribution analysis of the Company’s revenues by region is as follows:
|
|
Years ended March 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
|
|
|
|
|
|
China
|
|
$
|
12,125
|
|
|
$
|
190,426
|
|
Singapore
|
|
|
2,655,182
|
|
|
|
6,103,955
|
|
Malaysia
|
|
|
219,251
|
|
|
|
3,658,083
|
|
Philippines
|
|
|
139,468
|
|
|
|
1,696,581
|
|
Thailand
|
|
|
7,241
|
|
|
|
797,250
|
|
Indonesia
|
|
|
35,508
|
|
|
|
401,628
|
|
Other countries in Asia Pacific
|
|
|
5,945
|
|
|
|
557,576
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
3,074,720
|
|
|
$
|
13,405,499
|
|
All of the Company’s long-lived assets are
located in Singapore.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
(b) Major
vendors
For the year ended March 31, 2021, this is one
single vendor representing more than 10% of the Company’s purchase. This vendor, (a related company) accounted for 49% of the Company’s
purchase amounting to $275,071 with $127,574 of accounts payable.
For the year ended March 31, 2020, there is no
one single vendor representing more than 10% of the Company’s purchase.
As the Company has no significant interest-bearing
assets, the Company’s income and operating cash flows are substantially independent of changes in market interest rates.
The Company’s interest-rate risk arises
from borrowings under finance lease. The Company manages interest rate risk by varying the issuance and maturity dates variable rate debt,
limiting the amount of variable rate debt, and continually monitoring the effects of market changes in interest rates. As of March 31,
2021 and 2020, borrowing under mortgage was at fixed rates.
|
(d)
|
Economic and political risk
|
The Company’s major operations are conducted
in Republic of Singapore. Accordingly, the political, economic, and legal environments in Singapore, as well as the general state of Singapore’s
economy may influence the Company’s business, financial condition, and results of operations.
The Company cannot guarantee that the current
exchange rate will remain steady; therefore there is a possibility that the Company could post the same amount of profit for two comparable
periods and because of the fluctuating exchange rate actually post higher or lower profit depending on exchange rate of SGD$ converted to
US$ on that date. The exchange rate could fluctuate depending on changes in political and economic environments without notice.
17. COMMITMENTS
AND CONTINGENCIES
As of March 31, 2021 and 2020, the Company has
no material capital commitments in the next twelve months.
NOBLE VICI GROUP, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2021 AND 2020
(Currency expressed in United States Dollars
(“US$”), except for number of shares)
In April 2020, the Company received invoices from
each of the Public Company Accounting Oversight Board (“PCAOB”) and the Financial Accounting Standards Board (“FASB”)
in the amounts of $702,600 and $92,100, respectively, for our share of the PCAOB and FASB Issuer Accounting Support Fee for calendar year
2020. The fees were due May 18, 2020. The Company has petitioned the PCAOB and FASB to review its fee assessments and is in the process
of review. The Company believes that there is a material likelihood that it will not prevail, and that it will be required to pay all
assessed fees.
In accordance with applicable accounting guidance,
the Company records accruals for certain of its outstanding legal proceedings, investigations or claims when it is probable that a liability
will be incurred, and the amount of loss can be reasonably estimated. The Company evaluates, on a quarterly basis, developments in legal
proceedings, investigations or claims that could affect the amount of any accrual, as well as any developments that would make a loss
contingency both probable and reasonably estimable. The Company discloses the amount of the accrual if the financial statements would
be otherwise misleading.
When a loss contingency is not both probable and
estimable, the Company does not establish an accrued liability. However, if the loss (or an additional loss in excess of the accrual)
is at least a reasonable possibility and material, then the Company discloses an estimate of the possible loss or range of loss, if such
estimate can be made or discloses that an estimate cannot be made.
The assessments whether a loss is probable or
a reasonable possibility, and whether the loss or a range of loss is estimable, often involve a series of complex judgments about future
events. Management is often unable to estimate a range of reasonably possible loss, particularly where (i) the damages sought are substantial
or indeterminate, (ii) the proceedings are in the early stages, or (iii) the matters involve novel or unsettled legal theories or a large
number of parties. In such cases, there is considerable uncertainty regarding the timing or ultimate resolution of such matters, including
a possible eventual loss, fine, penalty or business impact, if any.
The Company expects that the aggregate range of
reasonably possible losses for such legal proceeding is likely to range from approximately $800,000 and upwards if penalties or interest
are assessed against us in the event that the Company is unable to timely pay assessed amounts. It is probable that $800,000 will be payable
by March 31, 2021. The estimated aggregate range of reasonably possible losses is based upon currently available information for those
proceedings in which the Company is involved, taking into account the Company’s best estimate of such losses for those cases for
which such estimate can be made. Those matters for which an estimate is not possible are not included within this estimated range. Therefore,
such range represents what the Company believes to be an estimate of possible loss only for those matters meeting such criteria. It does
not represent the Company’s maximum loss exposure.
Except as set forth above, there are no material
pending legal proceedings to which the Company or its subsidiaries are a party or to which any of its or their property is subject, nor
are there any such proceedings known to be contemplated by governmental authorities. None of the Company’s directors, officers,
affiliates or any owner of record or beneficially of more than 5% of our common stock, or any associate of any of the foregoing, is involved
in a proceeding adverse to its business or has a material interest adverse to its business.
18. SUBSEQUENT
EVENTS
In accordance with ASC Topic 855, “Subsequent
Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date
but before consolidated financial statements are issued, the Company has evaluated all events or transactions that occurred after March
31, 2021, up through the date the Company issued the audited consolidated financial statements.
On June 25, 2021, the Company appointed Greatsolutions
Pte. Ltd., a Singapore corporation, (“GSP”) to serve as the authorized distributor of new biodegradable waste recycling machine
for the territory of Singapore in accordance with the terms of that certain Authorized Distributor Agreement (the “Authorized Distributor
Agreement”). Pursuant to the terms of the Authorized Distributor Agreement, GSP agreed to purchase 100 units of the Company’s
machines as well as other related products and pay a license fee of USD One Million Dollars (US$1,000,000) for the first year of the term.
The term of the Authorized Distributor Agreement will begin upon the successful commission of the first machine in Singapore. The Company
is in the process of working with the relevant governmental agencies to have the machines commissioned for use in Singapore. On July 12,
2021, $100,000 was received as a portion of the license fee.