The Board of Directors (“Board”) of XOX Bhd (“XOX” or the “Company”) wishes to announce that XOX Media Sdn Bhd (“XOX Media”), a wholly-owned subsidiary of the Company, had on 12 March 2021 entered into a Heads of Agreement (“HOA”) with Cheetah Corporation (M) Sdn Bhd (“CHEETAH”) and Lamboplace Sdn Bhd (“LAMBO”) for the purpose to jointly create a rebranded and reimagined CHEETAH exclusive digital shopping platform. 

CHEETAH is a wholly-owned subsidiary of Cheetah Holdings Berhad, a company duly listed on the Main Market of Bursa Malaysia Stock Exchange. CHEETAH’s principal business is product designing, product development, marketing and retailing of sports apparel and accessories and casual wear under its own brand name. 

LAMBO is a wholly-owned subsidiary of Lambo Group Berhad, a company duly listed on the ACE Market of Bursa Malaysia Stock Exchange. LAMBO has its own business-to-consumer (B2C) e-commerce marketplace known as “LamboPlace” offering lifestyle consumer products including food products, apparels and accessories, baby toys and collectibles, fitness products, home and living products, lifestyle gadgets as well as beauty and wellness products.

The salient terms of the HOA are as follows : 

(a) Business Collaboration

i) CHEETAH will be the owner of the digital e-commerce platform, supplying the relevant merchandising and stock-keeping units (“SKU”) to capture a share of the massive online clothing market. CHEETAH will also coordinate with the rest of the teams to provide continuous content creation and updated designs to appeal to a more digitally savvy and younger target market.  

ii) XOX Media will provide its knowhow in its recent success of its BLACK Market marketplace App. The natural exposure to its existing clients of 2.2 million subscribers and 20,000 dealers provides an immediate reach and instant scalability. XOX Media will also provide input and technical support to create a CHEETAH store app similar to the BLACK Market.

iii) LAMBO will provide its expertise in technological development to build the shopping mall platform, incorporating machine learning technology and consumer behavior analysis. This will dovetail into LAMBO’s desire to venture into an e-fulfillment business model, with CHEETAH and XOX Media as partners and anchor clients.

(b) Parties Commitment

i) The parties have agreed to immediately implement the project with clear separation of revenue models and relevant skills and technology to be combined in an executive planning committee. 

ii) The costs of deployment of this project are segregated to each party individually to a clear defined revenue ownership structure, finalised internally through the executive committee.

iii) The executive committee will commence implementation of the project immediately.

(c) Duration of HOA

The HOA shall be effective from 12 March 2021 and shall terminate upon the occurrence of any of the following events: 

i) 6 months without any finalised commercial agreement between the parties.

ii) Mutual termination by all the parties, in writing.

iii) In the event of insolvency, liquidation or filing of winding up petition of any party.

iv) Upon the parties entering into a Formal Agreement.

Notwithstanding subparagraph (i) the above, the HOA may be extended by mutual agreement in writing of the parties.

The HOA will not have any effects on the share capital and shareholding structure of the Company and is not expected to have any material immediate effect on the earnings per share, net assets per share and gearing of XOX for the financial year ending 30 September 2021.

Similar to all business entities, the risk factors affecting the execution of the HOA, including but not limited to business risks such as prudent financial management, changes in political, economic and regulatory conditions. However, the Board will continue to exercise due care in considering the risks associated with the HOA and will take appropriate measures in planning the successful execution of the HOA.

The HOA being incurred in the ordinary course of business, is not subject to the approval of the shareholders. 

Save as disclosed below, none of the directors and/or major shareholders of the Company and/or persons connected with them have any interest, whether direct or indirect, in the HOA:

(a) Common directorships of Mr Roy Ho Yew Kee in XOX and Cheetah Holdings Berhad.

The Board, after due consideration, is of the opinion that the HOA is in the best interest of the Group.

This announcement is dated 12 March 2021.