NOTE 12 - COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2016

Notes to Financial Statements

NOTE 12 - COMMITMENTS AND CONTINGENCIES

NOTE 12 COMMITMENTS AND CONTINGENCIES

The Company’s commitments and contingencies are set out below as follows:-

(a) As announced in a Form 8K on December 16, 2015 on December 11, 2015 the Company acquired and a 51% interests in Naim Indah Mobile Communication Sdn. Bhd. (“NIMC”), a company engaged in providing mobile communication services through MVNO platform. NIMC has a registered capital of RM2,000,001 (or about US$480,000) of which the Company is required to pay RM1,000,001 (or about US$240,000) for its 51% interests. Our director Ahmad Shukri Abdul Ghani is a 30% shareholder of NIMC. Our subsidiary Naim Indah Mobile Communication Sdn. Bhd. (“NIMC”) has an exclusive business partnership agreement (“Exclusive Agreement”) with MyAngkasa Holdings Sdn. Bhd. (“MyAngkasa”), a wholly owned company of the National Cooperative Malaysia Bhd and known as Angkatan Koperasi Kebangsaan Malaysia Berhad (“Angkasa”). The Exclusive Agreement has a fix term of 5 years ending in August 2020 and subject to renewal by mutual consent. Pursuant to this agreement, MyAngkasa agrees to use NIMC’s services under the trade name of “Median Mobile” products to co-operatives and members of the co-operatives under Angkasa and to exclusively appoint NIMC as the official mobile telecommunication services based on MVNA platform to Angkasa members. MyAngkasa agrees to undertake to deliver certain number of subscribers for pre/post-paid services (“Targeted Subscribers”) for each year. In return, NIMC agrees to a profit share scheme whereby MyAngkasa will receive RM100,000 (or about US$24,000) for the first financial year of the contract, and for each financial year thereafter the higher of RM500,000 (or about US$120,000) and a set percentage of NIMC’s net annual profit after tax, less any unapplied accumulative losses brought forward from previous years. If the Targeted Subscribers are not achieved for any each then the set percentage to be applied will be the pro-rate of the actual subscribers to the Targeted Subscribers for that year.