| Commitments |
NOTE 16 - Commitments
As of June 30, 2019, the Company's
significant commitment is summarized as follows:
| |
|
Yihe Culture
Media Agreement: On June 20, 2018, the Company entered into a Cooperation Framework Agreement with Shenzhen Yihe Culture
Media Co., Ltd. ("Yihe"), the authorized agent of Guangdong Tengnan Internet, pursuant to which Yihe will promote
the development of strategic cooperation between the Company and Guangdong Tengnan Internet. Specifically, Yihe agreed to
assist the Company with public relations and advertising, such as market and brand promotion, as well as brand recognition
in China (excluding Hong Kong, Macao and Taiwan), including but not limited to news dissemination, creative planning and support
of campaigns, financial public relations and internet advertising. More specifically, Yihe will help the Company develop a
working application of the WeChat Pay payment solution as well as WeChat applets applicable for Chinese users and relating
to cell phone and WiFi connectivity on airplanes, and Yihe will assist the Company in integrating other Tencent internet-based
original product offerings. As compensation, the Company agreed to pay Yihe RMB 8 million (approximately US$1.2 million),
RMB 2,000,000 (approximately US$309,000) of which the Company paid on June 29, 2018 and the remaining RMB 6,000,000 (approximately
US$927,000) of which was to be paid by August 15, 2018. On July 19, 2019, Yihe and the Company agreed to extend the expiration
date of the agreement to June 20, 2022 and to extend the date by which the Company must pay the remaining RMB 6,000,000 on August
12, 2019. |
| |
|
|
| |
|
Airbus SAS Agreement: On
November 30, 2018, in furtherance of a memorandum of understanding signed in March 2018, the Company entered into an agreement
with Airbus SAS ("Airbus"), pursuant to which Airbus will develop and certify a complete solution allowing the
installation of our "AERKOMM K++" system on Airbus' single aisle aircraft family including the Airbus A319/320/321,
for both Current Engine Option (CEO) and New Engine Option (NEO) models. Airbus will also apply for and obtain on our behalf
a Supplemental Type Certificate (STC) from the European Aviation Safety Agency, or EASA, as well as from the U.S. Federal
Aviation Administration or FAA, for the retrofit system. It is anticipated that the Bilateral Aviation Safety Agreement between
EASA and the Civil Aviation Administration of China, or CAAC, will be finalized and go into effect in 2019. Pursuant to the
terms of our Airbus agreement, The Company agreed to pay the service fees that Airbus provides the Company with the retrofit
solution which will include the Service Bulletin and the material kits including the update of technical and operating manuals
pertaining to the aircraft and provision of aircraft configuration control. The timeframe for the completion and testing of
this retrofit solution, including the certification, is approximately 16 months from the purchase order issued in August 2018,
although there is no guarantee that the project will be successfully completed in the projected timeframe.
|
|