Quarterly report pursuant to Section 13 or 15(d)

Significant Related Party Transactions (Tables)

Significant Related Party Transactions (Tables)
3 Months Ended
Mar. 31, 2021
Related Party Transactions [Abstract]  
Schedule of name of related parties and relationships with the Company
Related Party   Relationship
Well Thrive Limited (“WTL”)   Major stockholder
Yuan Jiu Inc. (“Yuan Jiu”)   Stockholder; Albert Hsu, a Director of Aerkomm, is the Chairman
AA Twin Associates Ltd. (“AATWIN”)   Georges Caldironi, COO of Aerkomm, is the sole owner
EESquare Japan (“EESquare JP”)   Yih Lieh (Giretsu) Shih, President Aircom Japan, is the Director
Wealth Wide Int’l Ltd. (“WWI”)   Bummy Wu, a stockholder, is the Chairman
Schedule of significant related party transactions
a. As of March 31, 2021 and December 31, 2020:


    March 31,
    December 31,
Inventory prepayment to Yuan Jiu1   $ 180,710     $ 542,130  
Loan from WTL2   $ 2,444,695     $ 527,066  
Other payable to:                
AATWIN3   $ 201,061     $ 146,673  
Interest payable to WTL2     25,225       7,623  
Others4     355,103       296,890  
Total   $ 581,389     $ 451,186  
Lease liability to WWI5   $ 57,484     $ 68,661  


  1. Represents inventory prepayment paid to Yuan Jiu. On May 11, 2020, the Company entered into a product purchase agreement (PO1) with Yuan Jiu to purchase 100 sets of the AirCinema Cube to be installed on aircraft of commercial airline customers. The total purchase amount under this agreement was $1,807,100 and the Company paid 20% of the total amount, or $361,420, as an initial deposit. On July 15, 2020, the Company signed a second product purchase agreement (PO2) of $1,807,100 with Yuan Jiu for an additional 100 sets of the AirCinema Cube for the same purchase amount and paid a 10% initial deposit of $180,710 on this agreement as well. In February 2021, the Company paid the remaining balance of PO1 and received the inventory with aggregate value of $1,807,100.


  2. The Company has loans from WTL due to operational needs under the Loans (Note 1). The original loan amount was approximately $2.64M (NTD 80,000,000). The loan agreement, with an interest rate of 5% per annum, will terminate on December 31, 2021. The Company has repaid approximately $0.24M (NTD 10,375,000) of the outstanding loan amount as of March 31, 2021. As of May 20, 2021, the Company borrowed approximately additional $1.5M (unaudited) (NTD 41,984,000) (unaudited) from WTL under the loans.


  3. Represents payable to AATWIN due to consulting agreement on January 1, 2019. The monthly consulting fee is EUR 15,120 (approximately $17,000) and will be expired December 31, 2021.

  4. Represents payable to employees as a result of regular operating activities.

  5. Aircom Hong Kong has a lease agreement with WWI for the warehouse with a monthly rental cost of $450. The lease term was from July 1, 2020 to June 30, 2022. Aircom Hong Kong has another lease agreement with WWI for its office space in Hong Kong. The original lease term was from June 28, 2018 to June 27, 2020 with a monthly rental cost of HKD 29,897 (approximately $3,847). The Company renewed the lease on June 27, 2020 and the current lease term is from June 28, 2020 to June 27, 2022 with a monthly rental cost of HKD 30,000 (approximately $3,829).
Schedule of expenses paid to and income charged from related parties

  b. For the three-month periods ended March 31, 2021 and 2020:




  Three Months Ended
March 31,
    2021     2020  
    (Unaudited)     (Unaudited)  
Purchase from Yuan Jiu1   $ 1,807,100     $ -  
Consulting expense charged by AATWIN3     54,388       50,111  
Interest expense charged by WTL2     17,951       3,987  
Rental expense charged by WWI5     11,988       11,542  
Rental income from EESqaure JP6     (2,826 )     (2,754 )


  6. Aircom Japan entered into a sublease agreement with EESquare JP for the period between March 5, 2019 and March 4, 2021. Pursuant to the terms of this lease agreement, EESquare JP pays Aircom Japan a rental fee of approximately $920 per month.