{"url_path":"/sec/upyy/10-k/2026/item-13","section_key":"item-13","section_title":"Item 13 CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS, AND DIRECTOR INDEPENDENCE","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-02","source_url":"https://www.sec.gov/Archives/edgar/data/1677897/0001575872-26-000390-index.html","accession_number":"0001575872-26-000390","cik":"0001677897","ticker":"UPYY","issuer_name":"UPAY","edgar_url":"https://www.sec.gov/Archives/edgar/data/1677897/0001575872-26-000390-index.html","primary_entity_key":"0001677897","primary_entity_name":"UPAY"},"word_count":1980,"has_tables":true,"body_markdown":"ITEM 13. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS, AND DIRECTOR INDEPENDENCE\n\nDue to Related Parties\n\n \n\nOn March 24, 2021, we entered into a promissory note with our Chief Executive Officer (“CEO”) for $10,000, which is unsecured, bears interest of 10% per annum and matured on March 24, 2022.\n\nAs at February 28, 2026, the outstanding principal is $10,000 (February 28, 2025 – $10,000) and we have recognized accrued interest of $4,937 (February 28, 2025 – $3,937), which is included in due to related parties.\n\n \n\nOn September 7, 2021, we entered into a promissory note with our CEO for $10,000, which is unsecured, bears interest of 10% per annum and matured on March 7, 2022.\n\nAs at February 28, 2026, the outstanding principal is $10,000 (February 28, 2025 – $10,000) and we have recognized accrued interest of $4,479 (February 28, 2025 – $3,479), which is included in due to related parties.\n\n \n\nOn February 11, 2022, we entered into a promissory note with our CEO for $20,000, which is unsecured, bears interest of 10% per annum and matured on February 11, 2023.\n\nAs at February 28, 2026, the outstanding principal is $20,000 (February 28, 2025 – $20,000) and we have recognized accrued interest of $8,099 (February 28, 2025 – $6,099), which is included in due to related parties.\n\n \n\nOn April 14, 2021, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $26,000, which is unsecured, bears interest of 10% per annum and matured on October 13, 2023. As at February 28, 2025, the outstanding principal is $26,000\n\n(February 28, 2025 – $26,000) and we have recognized accrued interest of $nil (February 28, 2025 – $10,087), which is included in due to related parties.\n\nOn October 17, 2025, the Company issued 140,007 shares of common stock with a fair value of $196,010 to settle the outstanding principal of $26,000 and accrued interest of $11,732, resulting in a loss on settlement of debt of $158,278.On February 11, 2022, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $130,000, which is unsecured, bears interest of 10% per annum and matured on February 11, 2023. As at February 28, 2026, the outstanding principal is $nil (2025 – $130,000) and we have recognized accrued interest of $nil (2025 – $39,641), which is included in due to related parties. On October 17, 2025, the Company issued 659,993 shares of common stock with a fair value of $923,990 to settle the outstanding principal of $130,000 and accrued interest of $47,868, resulting in a loss on settlement of debt of $746,122.\n\n30\n\nDuring the year ended February 28, 2022, a third-party lender purchased a promissory note from a company controlled by a significant shareholder of the Company in the amount of $15,000, which is unsecured, bears interest of 10% per annum and matured on October 13, 2023.\n\nAs at February 28, 2026, the outstanding principal is $15,000 (2025 – $15,000) and we have recognized accrued interest of $7,319 (2025 – $5,819), which is included in due to related parties.\n\nOn May 2, 2022, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $25,000, which is unsecured, bears interest of 10% per annum and matured on March 2, 2023.\n\nAs at February 28, 2026, the outstanding principal is $25,000 (2025 – $25,000) and we have recognized accrued interest of $9,575 (2025 – $7,075), which is included in due to related parties.\n\nOn September 9, 2022, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $15,000, which is unsecured, bears interest of 10% per annum and matured on September 9, 2023.\n\nAs at February 28, 2026, the outstanding principal is $15,000 (2025 – $15,000) and we have recognized accrued interest of $5,211 (2025 – $3,711), which is included in due to related parties.\n\n \n\nOn January 31, 2025, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $50,000, which is unsecured, bears interest of 10% per annum and matured on January 31, 2027.\n\nAs at February 28, 2026, the outstanding principal is $50,000 (2025 – $50,000) and we have recognized accrued interest of $5,383 (2025 – $383), which is included in due to related parties.\n\n \n\nOn March 3, 2025, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $50,000, which is unsecured, bears interest of 10% per annum and matures on March 3, 2027. As at February 28, 2026, the outstanding principal is $50,000 and we have recognized accrued interest of $4,959, which is included in due to related parties.\n\n \n\nOn May 9, 2025, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $29,000, which is unsecured, bears interest of 10% per annum and matures on May 9, 2027. As at February 28, 2026, the outstanding principal is $29,000 and we have recognized accrued interest of $2,344, which is included in due to related parties.\n\n \n\nOn May 22, 2025, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $41,000, which is unsecured, bears interest of 10% per annum and matures on May 22, 2027. As at February 28, 2026, the outstanding principal is $41,000 and we have recognized accrued interest of $3,168, which is included in due to related parties.\n\n \n\nOn July 23, 2025, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $50,000, which is unsecured, bears interest of 10% per annum and matures on July 23, 2027. As at February 28, 2026, the outstanding principal is $50,000 and we have recognized accrued interest of $3,014, which is included in due to related parties.\n\n \n\nOn September 12, 2025, we entered into a promissory note with a company controlled by a significant shareholder of the Company for $50,000, which is unsecured, bears interest of 10% per annum and matures on September 12, 2027. As at February 28, 2026, the outstanding principal is $50,000 and we have recognized accrued interest of $2,315, which is included in due to related parties.\n\n \n\nAs at February 28, 2025, we owe a total of $600 (February 29, 2024 – $nil) to our officers for advances, which are unsecured, non-interest bearing and due on demand.\n\n \n\nDuring the year ended February 28, 2026, we incurred salary expenses of $110,168 (R1,970,905) (2025 – $107,911 (R1,976,929) to our CEO.\n\n \n\n31\n\nDuring the year ended February 28, 2025, we incurred directors’ fees of $91,875 (2024 – $65,000) to a Director of the Company pursuant to a Director Agreement (Note 10(b).\n\n \n\nDuring the year ended February 28, 2025, we incurred directors’ fees of $4,928 (R90,000) (2024 – $nil) to a Director of the Company.\n\n \n\nDuring the year ended February 28, 2025, we incurred management fees of $nil (2024 - $174,998) and director fees of $70,000 (2024 - $75,000) to the Director and former Chief Operating Officer (“COO”) of the Company pursuant to a Director and Officer Agreement (Note 10(c).\n\n \n\nStock Issuances to our Founders\n\n \n\nOn October 1, 2015, we issued 9,025,000 shares to our co-founder, Wouter A. Fouche, at an aggregate value of $12,033.\n\nUnder the February 3, 2022, Share Purchase and Separation Agreement, the Company repurchased 7,125,000 of those shares and, following the September 1, 2023 amendment, acquired the remaining 2,035,000 shares.\n\nWouter A. Fouche is no longer a shareholder, director or in any way associated with the company.\n\n \n\nOn October 1, 2015, we issued 9,025,000 shares to our co-founder, Jacob C Fölscher, at an aggregate value of $12,033.\n\n \n\nOn November 5, 2015, pursuant to the Share Exchange with Rent Pay, we issued 100,000 common stock shares to LoanTech Trust, a trust controlled by our officer, Wouter Fouche, at an aggregate value of $10,000.\n\n \n\nOn November 5, 2015, pursuant to the Share Exchange with Rent Pay, we issued 100,000 common stock shares to Fölscher Family Trust, a trust controlled by our officer, Jacob C Fölscher, at an aggregate value of $10,000.\n\n \n\nOn April 20, 2016, we issued 50,000 shares to Kim Elizabeth Fölscher, Jacob Fölscher’s wife, at an aggregate value of $5,000.\n\n \n\nOn December 12, 2015, we issued 40,000 shares to Desiree Fouche, Wouter Fouche’s wife, at an aggregate value of $4,000.\n\n \n\nVerbal Agreements with our Founders\n\n \n\nVerbal Agreement with Wouter Fouche\n\n \n\nWe had a February 2014 verbal agreement with our Chief Executive Officer, Wouter Fouche, to pay him a monthly salary of $6,000 for our fiscal years 2015 and 2016 based upon available funds. This monthly salary has since increased to $9,000, for 2018 and 2019 and $9,500 for 2021 dependent on available funds. There is also a 13\nth\ncheck that is payable yearly. A $10,000 relocation expense for relocating to the US was also paid to Wouter Fouche previously. This monthly salary and $10,000 relocation expense already paid were the sole terms of this verbal agreement. This agreement has terminated pursuant to a February 3, 2022 Share Purchase and Separation agreement between us and Wouter Fouche.\n\nWouter Fouche has since resigned from all previous positions at the Company.\n\n32\n\nVerbal Agreement with Jacob C Fölscher\n\nWe have a February 2014 verbal agreement with our Chief Financial Officer, Jacob C. Fölscher, to pay him a monthly salary of $6,000 for our fiscal years 2015 and 2016 based upon available funds. This monthly salary has since increased to $9,000 for 2018 and 2019 and $9,500 for 2021 dependent on available funds. There is also a 13\nth\ncheck that is payable yearly. Additionally, we verbally agreed to pay Jacob C. Fölscher a $10,000 relocation expense for relocating, should this be needed in future. The $9,500 monthly salary and $10,000 relocation expense are the sole terms of this verbal agreement. Since February 2022, he has also assumed the role of CEO. Although he is not currently receiving compensation for this additional responsibility, the board has verbally agreed to consider awarding Jacob C. Fölscher a performance-based bonus in the future.\n\nConsulting Agreement\n\nWe have a June 3, 2016 consulting agreement with Ferdinand Labuschagne to perform business advisory services in return for 300,000 restricted common stock shares for an aggregate value of $30,000 and two million cashless warrants, the details of which are contained in our Material Agreements Section beginning at page 39. Ferdinand Labuschagne is Wouter A. Fouche’s brother-in-law. The consulting agreement has since come to an end and the 300,000 shares were issued previously. The two million cashless warrants have since expired.\n\nTwin Harbor Web Solutions (“Twin Harbor”) individually owns more than 5% of our common stock. On 16 April 2018, we acquired the Theme Studio software from Twin Harbor in exchange for 2,000,000 common shares for an aggregate purchase price of $200,000. In addition, we have a service level agreement for development and hosting solutions with Twin Harbor. The transactions are related party transactions and Twin Harbor is a related party.\n\nApart from the above transaction, none of our Officers or Directors has any direct or indirect material interest in any transaction to which we are a party during the past two years, or in any proposed transaction to which we are proposed to be a party.\n\nGiven our small size, we have not adopted formal policies and procedures, apart from our company Bylaws and Code of Ethics, for the review, approval or ratification of related party transactions with our executive officer(s), Director(s) and significant stockholders. We intend to establish more formal policies and procedures in the future so that such transactions will be subject to the stricter review, approval or ratification of our Board of Directors, or an appropriate committee thereof. On a moving forward basis, our Directors will continue to approve or disapprove any and all related party transaction."}