VEII Value Exchange International Inc (QB)

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): December 20, 2023 (December 14, 2023)

 

VALUE EXCHANGE INTERNATIONAL, INC.

(Exact name of Registrant as specified in its charter)

 

Nevada		000-53537		26-3767331
(State or other jurisdiction		(Commission File Number)		(IRS Employer
of Incorporation)				Identification No.)

 

Unit 602, Block B, 6 Floor, Shatin Industrial Centre, 5-7 Yuen Shun Circuit,

Shatin, N.T., Hong Kong SAR

(Address of principal executive offices) (Zip Code)

(852) 2950 4288

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:

 

	¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
	¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
	¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
	¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

Securities registered pursuant to Section 12(b) of the Exchange Act:

 

Title of Each Class	Trading Symbol	Exchange on which registered
NONE	----	----

 

 

Item 1.01 Entry into a Material Definitive Agreement. On December 14, 2023, Value Exchange International, Inc., a Nevada corporation, (“Company”) entered into a Convertible Credit Agreement (collectively, the “Credit Agreement”) with Hapi Metaverse, Inc., a Delaware corporation, (“Lender’) for an unsecured credit line in the maximum amount of One Million U.S. Dollars and No Cents (USD$1,000,000.00) (“Credit Limit”). Advances of the principal under the Credit Agreement accrue simple interest at Eight Percent (8%) per annum. The Lender may in its discretion refuse to make any advances of money to the Company or may refuse to provide funding in the amount requested by the Company. Any approved advance is to be funded (“Advance”) within ten (10) days after approval of the request for an advance of money under the Credit Agreement. Lender is a reporting company under the Securities Exchange Act of 1934, but there is no active trading market for the Lender’s capital stock.

 

Need for Funding and Use of Proceeds. The Company needed funding on an expedited basis and in place prior to 2024 in order to fund requirements for new and existing customer work and to pay for overall general operational expenses. Lender was the only known and identified funding source willing to provide the necessary funding on an expedited basis. Credit Line may be used for general working capital, including possible expansion of existing business operations or business lines to new geographical markets in Asia or other geographical markets; for development of new business lines (whether in existing or new geographical markets); acquisition of assets or companies (whether in existing or new geographical markets); and payment of any sums due under the Credit Agreement or other loans.

 

Repayment of Advances and Interest. Each Advance and all accrued interest thereon may, at the election of the Lender, or the Company, be: (1) repaid in cash; (2) converted into shares of the Company Common Stock; or (3) be repaid in a combination of cash and shares of the Company Common Stock. The principal amount of each Advance shall be due and payable on the third (3^rd) annual anniversary of the date that the Advance is received by the Company along with any unpaid interest accrued on the principal (the “Advance Maturity Date”). Prior to the Advance Maturity Date, unpaid interest accrued on any Advance shall be paid on the last business day of June and on the last business day of December of each year in which the Advance is outstanding and not converted into shares of Company Common Stock. Company may prepay any Advance and interests accrued thereon prior to Advance Maturity Date without penalty or charge.

 

Fee on Advances. The Credit Agreement provided that each Advance incurs a 10% fee on the amount of the Advance (“Fee”), payable in cash or shares of Company’s Common Stock (“Common Stock”) at the election of Company. Under a December 19, 2023 Amendment to the Credit Agreement, which amendment is attached to this Current Report on Form 8-K as Exhibit 10.2, the Fee was amended to provide for a one-time $100,000 payment instead of 10% on an Advance, which amended Fee is payable at option of Company in either cash or shares of Company Common Stock within 30 days of December 19, 2023.

 

Conversion to Shares of Common Stock. Lender or Company may convert monies owed under any Advance into shares of Company Common Stock (“Conversion”). The price for conversion of an Advance and unpaid interest accrued thereon into shares of Common Stock shall be based on US$0.045 per share, which is an approximately twenty-five percent (25%) discount from the market closing price as of December 12, 2023 (the “Conversion Price”). No fractional shares may be issued in any Conversion.

 

Conversion Process. If the Lender elects to effect a Conversion, it must deliver a Notice of Conversion to the Company that specifies the amount of the advance and accrued interest, if any, to be converted, and the date on which such conversion shall be effected (the “Conversion Date”). If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion is deemed received by the Company. Conversions shall reduce the amount advanced in an amount equal to the amount of the advance that is converted in a Conversion.

 

Conversion upon a Change in Control Transaction. In the event that the Company consummates a “Change in Control Transaction” (as defined below), then the total amount of Advances outstanding, and not previously converted into shares of Company Common Stock, shall convert into shares of Company Common Stock at the Conversion Price upon receipt of written notice from the Lender to the Company. “Change in Control Transaction” will exist if (1) there occurs any consolidation, merger or other business combination of the Company with or into any third party and the Company is not the surviving entity, or any other corporate reorganization or transaction or series of related transactions in which in any of such events the voting stockholders of the Company prior to such event cease to own 50% or more of the voting power, or corresponding voting equity interests, of the surviving entity after the consummation of the transaction or transactions, or (2) in one or a series of related transactions, there is a sale or transfer of all or substantially all of the operating assets of the Company or substantially all of the Company’s operating and wholly-owned subsidiaries, determined on a consolidated basis, to a third party.

 

 

Conversion upon Breach of this Agreement. In addition to on-demand, non-breach Conversion and a Change of Control Conversion, the Lender may convert amounts owed under outstanding Advances if the Company breaches the Credit Agreement and does not remedy that breach within thirty (30) days after receipt of a written demand from the Lender (“Demand”), which Demand shall describe the breach, (a “Conversion Breach Event”). Upon occurrence of a Conversion Breach Event that is not timely remedied and receipt of a Notice of Conversion, the Company is required to convert the requested conversion amount of all outstanding amount of Advances not previously converted into shares of Company Common Stock within ten (10) days after receipt of the Notice of Conversion.

 

Warrants. In the event that the Lender elects to convert any portion of an advance into shares of Company Common Stock, the Company is obligated to issue to the Lender five (5) detachable warrants for each share of Company Common Stock issued in a Conversion (“Warrants”) in addition to the shares of Company Common Stock issued in the Conversion. Each Warrant will entitle the Lender to purchase one (1) share of Company Common Stock (“Warrant Shares”) at a per-share exercise price equal to the Conversion Price. The exercise period for each Warrant will be five (5) years from the date of issuance of the Warrant.

 

Restricted Securities. Any shares of Company Common Stock, any Warrants and any shares of Company Common Stock issued under the exercise of a Warrant shall be “restricted securities” under Rule 144 of the Securities Act of 1933 and requiring registration under federal securities laws and applicable state securities laws or an exemption from registration in order to be sold, transferred, assigned, or otherwise disposed, or to be pledged or hypothecated. The shares of Company Common Stock and Warrants will have restrictive legends.

 

Events of Default. The Credit Agreement’s events of default are: (1) failure to timely pay of any Advance when due and payable and the Company fails to cure such default within ten (10) days after receipt of a written notice of default from the Lender or its authorized agent; (2) a default of any non-monetary material covenant or agreement in the Credit Agreement that the Company does not remedy within thirty (30) days after receipt by the Company of a written notice of default from the Lender or its authorized agent (or within such other longer time period as may be therein specifically provided in the written notice); (3) a breach of any other obligations, covenant, representation or warranty contained in the Credit Agreement that is not cured within thirty (30) days from the receipt by the Company of a written notice from a Lender or its authorized agents; (4) the filing of a petition in bankruptcy or the commencement of any proceedings under any bankruptcy laws by or against the Company, which filing or proceeding, is not dismissed within sixty (60) days after the filing or commencement thereof, or (5) if the Company becomes insolvent, the filing of a petition to a court for the entry of an order, judgment or decree approving a petition in an insolvency, liquidation or similar procedure and the petition shall remain unvacated or not removed for an aggregate of sixty (60) days (whether or not consecutive) from the first date of entry thereof or rejected by such court; (6) all or any part of the Company’s assets, or of any or all of the royalties, revenues, rents, issues or profits thereof, shall be appointed without the consent of the Company and such appointment shall remain unvacated and unstayed for an aggregate of sixty (60) days (whether or not consecutive); (7) entry of judgment or judgements in the aggregate in excess of One Hundred Thousand United States Dollars (US$100,000.00) in face amount, a writ of execution or attachment or any similar process shall be issued or levied against all of the Company’s assets, or any judgment involving monetary damages shall be entered against the Company which shall becomes a lien on all of the Company’s assets and such execution, attachment or similar process or judgment is not released, bonded, satisfied, vacated or stayed within sixty (60) days after its entry or levy; or (8) the Company ceases to conduct its primary business line for ninety (90) consecutive days.

 

Remedy for Default not timely Remedied. If, at any time, an event of default shall occur and is not timely remedied, then the unpaid amount of all Advances and unpaid interest accrued thereon shall become immediately due and payable without presentment, demand or protest, all of which are hereby waived by the Company.

 

 

Piggyback Registration Rights. The Credit Agreement grants piggyback registration rights for any shares of Company Common Stock and Warrants that are issued upon a conversion of sums owed under the Credit Agreement. The Credit Agreement provides that the Company will pay all expenses incurred in connection with a registration under the Securities Act of 1933, excluding underwriters’ and brokers’ discounts and commissions, but including, without limitation, all federal and “blue sky” registration and qualification fees, printers’ and accounting fees, fees and disbursements of counsel for the Company and the reasonable fees and disbursements of one (1) legal counsel for the selling securityholders will be borne by the Company. Piggyback registration rights do not apply to a registration statement under the Securities Act of 1933 for stock-based incentive compensation plan offerings or for corporate reorganization. The obligation of the Company in respect of the registration rights is subject to the condition that the selling shareholder provides the Company with information regarding the selling securityholder, the registrable securities of the selling securityholder and the intended method of disposition of such securities as will be required to timely effect the registration of the registrable securities and comply with applicable U.S. federal securities laws and regulations.

 

Governing Law; Disputes. Delaware law governs the Credit Agreement. Any action or proceeding arising out of or relating to the Credit Agreement shall be brought exclusively in the federal or state courts of Delaware.

 

Other Provisions. Credit Agreement and Amendment Number One to the Credit Agreement contain other usual and customary provisions for a commercial credit line agreement, including, without limitation, customary conditions to the obligation of Lender and the Company to conduct a closing of the Credit Agreement. The above summary of the Credit Agreement and the Amendment Number One to the Credit Agreement is qualified in its entirety by reference to the Convertible Credit Agreement, dated December 14, 2023, by the Company and Lender, which agreement is filed as Exhibit 10.1 to this Current Report on Form 8-K (”Form 8-K report”) and Amendment Number One to the Credit Agreement, dated December 19, 2023, which amendment is attached as Exhibit 10.2 to this Form 8-K.

 

Lender Ownership of Shares of Company Common Stock. Based on filings with the Commission, Lender owns 21,120,795 shares of Company Common Stock, which is approximately 48.55% of issued and outstanding shares of Company Common Stock (based on 43,500,762 shares issued and outstanding). On September 6, 2023, Lender converted $1,300,000 in debt owed by the Company into 7,344,632 shares of Company’s Common Stock at a price equivalent to $0.177 pursuant to that certain Convertible Credit Agreement dated as of January 27, 2023, (“January Credit Agreement”) made by Lender and New Energy CV Corporation (formerly, “American Wealth Mining Corp.”), a Nevada corporation, (“NECV”) to the Company. Lender’s ownership of shares of Company Common Stock above does not include a total of 36,723,160 shares of Company Common Stock that Lender may purchase under Warrants issued under the January Credit Agreement. The terms of the Warrants entitle the holder to purchase from the Company one (1) share of the Company Common Stock (as adjusted from time to time pursuant to the provisions of the Warrants) for each issued Warrant. The Warrants are currently exercisable and expire on September 6, 2028.

 

If Lender exercised the Warrants issued under the January Credit Agreement in full and purchased all 36,723,160 of the underlying shares of Company Common Stock, then Lender would own 57,843,955 shares of Company Common Stock or approximately 72.10% of the then issued and outstanding shares of Company Common Stock (based on the assumption of 80,223,922 shares of Company Common Stock then being issued and outstanding). Mr. Chan Heng Fai Ambrose , a director of the company, would, based on his control of Lender, also be a “shared” or joint owner of those shares of Company Common Stock. Mr. Chan controls Lender by virtue of his majority ownership of shares of common stock of Alset, Inc., a Texas corporation and a Commission-reporting company, (“Alset”), which is the parent company of the Lender. Alset owns 99.693% of the issued and outstanding shares of Lender’s common stock. Mr. Chan owns approximately 53.5% of the issued shares of common stock of Alset. Mr. Chan is also the Chairman and Chief Executive Officer of Alset and Executive Chairman of the Board of Directors of Lender.

 

Mr. Chan is deemed to be the owner of 21,587,429 shares of Common Stock, which represents approximately 49.63% of the issued shares of Company’s Common Stock (based on 43,500,762 shares issued and outstanding), by virtue of: 95,000 shares of Company’s Common Stock held by Mr. Chan, and the following share ownership of Common Stock by entities that Mr. Chan is deemed to control: 21,120,795 shares held by Lender, 39,968 shares held by BMI Capital Partners International Limited, 18,512 shares held by LiquidValue Development Pte Ltd. and 313,154 shares held by Decentralized Sharing Systems, Inc. BMI Capital Partners International Limited is owned by Alset International Limited, a Singapore company (“AIL”). AIL is a subsidiary of Alset. LiquidValue Development Pte Ltd. is a subsidiary of Alset. Decentralized Sharing Systems, Inc. is a subsidiary of DSS, Inc., a New York Stock Exchange listed company, (“DSS”). Mr. Chan is personally and through entities he controls, the largest shareholder of DSS. Mr. Chan is also the Chairman of the Board of Directors of DSS.

 

 

Mr. Chan, Lender, BMI Capital Partners International Limited, LiquidValue Development Pte Ltd. and Decentralized Sharing Systems, Inc. are referred to collectively below as “Affiliated Shareholders.”

 

Loans and Related Persons. The non-executive directors of the Company are: Chan Heng Fai ((also known as “Heng Fai Ambrose Chan”); Lum Kan Fai; Wong Tat Keung, Wong Shui Yeung; Robert Trapp and Lim Sheng Hon Danny.

 

Companies controlled, directly or indirectly, by Chan Heng Fai, including the Lender, have provided the Company with working capital loans or a credit line in 2022 and 2023. The loans or credit line have been made on an ad hoc, as needed basis and not part of any general agreement to provide ongoing financial support. These loans or credit line have been the sole third party debt funding of the Company in 2022 and 2023, and have funded working capital funding needs of the Company and its operating subsidiaries. There is no agreement, arrangement or understanding as of the date of the filing of this Form 8-K report between the Company and Mr. Chan, Lender or companies controlled or affiliated with Mr. Chan to provide ongoing or further debt or equity financing to the Company beyond existing loans or credit lines. There is no assurance that either the Lender, Mr. Chan or any of the companies controlled by or affiliated with Mr. Chan will provide any debt or equity funding to the Company in the future, or maintain or increase any existing ownership position in the shares of the Company Common Stock.

 

A summary of existing loans or credit lines of the Company are:

 

(1)    The Company and American Pacific Bancorp, Inc., a Texas corporation located in Houston, Texas, (“APB”) signed a Loan Agreement, Security Agreement and Revolving Credit Promissory Note, each dated July 26, 2022 (but fully executed and closed as of July 27, 2022), whereby APB provided a $1 million secured revolving credit line to the Company. APB is deemed to be controlled with Chan Heng Fai by virtue of Mr. Chan’s equity ownership of parent company of APB and his service as the Executive Chairman of the parent company of APB.

 

(2)    On January 27, 2023, Lender and NECV entered into the January Credit Agreement. On February 23, 2023, the Company made a loan in the amount of $1,300,000 to the Company pursuant to the January Credit Agreement. On September 6, 2023, Lender converted $1,300,000 of the principal amount loaned to the Company into 7,344,632 shares of Company’s Common Stock. Under the terms of the January Credit Agreement, the Company received common stock warrants to purchase a maximum of 36,723,160 shares of Company Common Stock at an exercise price of $0.1770 per share. The warrants expire five (5) years from date of their issuance. Mr. Chan is deemed to control the Lender by virtue of his ownership of shares of Alset, which owns 99.693% of the issued and outstanding shares of Lender’s common stock, and his position as Executive Chairman of the Board of Directors of the Lender and as Chairman of the Board of Directors and Chief Executive Officer of Alset. Mr. Lum is Vice Chairman of the Board of Directors of the Lender. Mr. Chan also controls NECV by virtue of his ownership of approximately 95.6% of issued shares of NECV common stock. Robert H. Trapp, a director of the Company, is also a director of NECV.

 

(3)    On September 28, 2023, the Company entered into a Loan Agreement and Promissory Note (collectively, the “AIL Loan Agreement”) with AIL for an unsecured loan of Five Hundred Thousand U.S. Dollars and No Cents (USD$500,000.00) principal amount (“Principal”) to the Company. Principal accrues simple interest at Eight Percent (8%) per annum. Repayment of Principal and accrued interest thereon is to be made as follows: Principal will be paid in a single lump sum payment on or by the six (6) month anniversary of the effective date of the AIL Loan Agreement, being March 28, 2024, (being the “Maturity Date”); and Interest accrued on Principal shall be paid on the last business day on a calendar monthly basis with initial accrued Interest payments commencing on September 28, 2023. AIL is a majority-owned subsidiary of Alset. Mr. Chan owns approximately 53.5% of the issued shares of common stock of Alset and Mr. Chan is the Chairman and Chief Executive Officer of Alset and Executive Chairman of the Board of Directors of AIL. Further, Wong Shui Yeung and Wong Tat Keung, who are directors of the Company, are also directors of Alset. Mr. Lim is an Executive Director of AIL and Alset and he is a Senior Vice President of AIL.

 

 

(4)    The Credit Agreement between Lender and Company is described in Item 1.01 above. Mr. Chan controls Lender by virtue of his majority ownership of shares of common stock of Alset, which is the parent company of the Lender. Alset owns 99.693% of the issued and outstanding shares of Lender’s common stock. Mr. Chan owns approximately 53.5% of the issued shares of common stock of Alset. Mr. Chan is also the Chairman and Chief Executive Officer of Alset and Executive Chairman of the Board of Directors of Lender. Mr. Lum is Vice Chairman of the Board of Directors of the Lender. Wong Shui Yeung and Wong Tat Keung are directors Alset. Wong Shui Yeung and Wong Tat Keung serve as directors of AIL. Mr. Lim Sheng Hon Danny currently serves as Senior Vice President and Executive Director of AIL. He also serves as an Executive Director of Alset.

 

Recusal and Affiliation of Non-Executive Directors. The non-executive directors of the Company are: Chan Heng Fai, Lum Kan Fai (also known as “Vincent Lum”), Robert Trapp, Wong Tat Keung, Wong Shui Yeung (also known as “Frankie Wong”), and Lim Sheng Hon Danny (also known as “Danny Lim”). All of the non-executive directors are affiliated by virtue of service as directors or officers of companies controlled by Chan Heng Fai and are deemed related parties in respect of the loans and credit lines as described in Loans and Related Persons above.

 

Chan Heng Fai (also known as “Heng Fai Ambrose Chan”), and Lum Kan Fai, each being a non-executive director of Company, recused themselves from consideration of, and the consent by the Company’s Board of Directors to, the Credit Agreement and transactions contemplated under the Credit Agreement. The recusal was due to these directors being directors of the Lender.

 

As stated above, Mr. Chan controls the Lender by virtue of his control of Alset. Mr. Chan is also Executive Chairman of the Board of Directors of the Lender and a director of American Pacific Bancorp., another lender of the Company. Mr. Lum Kan Fai is Vice Chairman of the Board of Directors of Lender and has served in other management capacities with HMI. Lum Kan Fai is also President of Digital Group of DSS. Mr. Chan is Executive Chairman of the Board of Directors of DSS and owns approximately 58.3% of the issued and outstanding shares of DSS. Wong Shui Keung is a non-executive director of DSS.

 

Robert Trapp was a director of Lender and was a director of Alset. He also serves or has served as a director of several subsidiaries of Alset. Mr. Trapp is a director of Sharing Services Global Corporation, a Nevada corporation and Commission-reporting company, (“SSGC”). Mr. Chan is Executive Chairman of the Board of Directors of SSGC as well as the owner of 49.2% of issued and outstanding shares of SSGC common stock, which ownership position includes shares of SSGC common stock owned by DSS and Alset. Further, Mr. Trapp is a director of NECV. Mr. Chan controls NECV by virtue of his ownership of approximately 95.6% of issued shares of NECV common stock.

 

Wong Shui Yeung and Wong Tat Keung are directors Alset, and have been or are affiliated with other entities controlled or affiliated with Mr. Chan. Wong Shui Yeung and Wong Tat Keung serve as directors of AIL, a subsidiary of Alset.

 

Wong Shui Yeung, Robert Trapp, and Wong Tat Keung also serve as members of the Company’s Audit Committee of the Board of Directors.

 

Mr. Lim Sheng Hon Danny currently serves as Senior Vice President and Executive Director of AIL. He also serves as an Executive Director of Alset, the parent company of AIL. Mr. Lim also works extensively with Mr. Chan on various business matters concerning AIL, Alset and DSS.

 

Item 5.01 Changes Control of Registrant. Due to the continued reliance by the Company on Lender and other affiliates of Chan Heng Fai for working capital debt funding, including the Lender, the increase in total aggregate ownership of Common Stock by the Affiliated Shareholders in 2023 and six (6) of the nine (9) Company’s directors being Chan Heng Fai and persons affiliated with Chan Heng Fai and, in respect of Mr. Chan and Mr. Lum, also the Lender, the Company’s Board of Directors has recognized as of the Effective Date that a change of control of the Company has occurred and Mr. Chan and Lender are deemed to have the ability to control the Company through voting power of stock ownership, board seats and funding of Company’s working capital needs.

 

 

While Chan Heng Fai, Wong Shui Yeung, Robert Trapp, Lum Fai Kai, Wong Tat Keung and Lim Sheng Hon Danny have not directed or controlled daily operational management or decision making, or strategic and business development decisions of the Company, beyond input and guidance as non-executive directors, and while the Company is not aware of any agreement among Chan Heng Fai, Wong Shui Yeung, Robert Trapp, Lum Fai Kai, Wong Tat Yeung and Lim Sheng Hon Danny, or among these directors and the Affiliated Shareholders or lenders of the Company, to direct the operational management and strategic planning of the Company or its operating subsidiaries, the Affiliated Shareholders collectively control 49.6% of Company’s issued shares of Common Stock. Further, the Lender, as an Affiliated Shareholder, has the right to convert the Warrant issued to Lender under the January Credit Agreement conversion into shares of Company Common Stock that would, if the Warrants are fully exercised, result in ownership of approximately 72.10% of the then issued and outstanding shares of Company Common Stock (based on the assumption of 80,223,922 shares of Company Common Stock then being issued and outstanding). With the Credit Agreement, Lender could, assuming a Conversion of any significant amount of Advances made to the Company, into an ownership position of shares of Common Stock into more than 80% of the then issued and outstanding shares of Common Stock.

 

Chan Heng Fai, Wong Shui Yeung, Robert Trapp, Lum Fai Kai, Wong Tat Keung and Lim Sheng Hon Danny have not directed or controlled daily operational management or decision making, or strategic and business development decisions of the Company, beyond input and guidance as non-executive directors, and the Company is not aware of any agreement among Chan Heng Fai, Wong Shui Yeung, Robert Trapp, Lum Fai Kai, Wong Tat Yeung and Lim Sheng Hon Danny or among these directors and the Affiliated Shareholders or lenders of the Company, to direct the operational management and strategic planning of the Company or its operating subsidiaries. The Affiliated Shareholders collectively control 49.6% of Company’s issued shares of Common Stock. The Lender, as an Affiliated Shareholder, has the right to exercise the Warrant issued to Lender under the January Credit Agreement conversion into shares of Company Common Stock that would, if the Warrants are fully exercised, result in ownership of approximately 72.10% of the then issued and outstanding shares of Company Common Stock (based on the assumption of 80,223,922 shares of Company Common Stock then being issued and outstanding). With the Credit Agreement, Lender could, assuming a Conversion of any significant amount of Advances made to the Company, into an ownership position of shares of Common Stock into more than 80% of the then issued and outstanding shares of Common Stock.

 

According to filings with the Commission, Mr. Chan used personal funds to acquire his shares of Company Common Stock and the Lender converted principal under the January Credit Agreement to acquire its shares of Company Common Stock.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits. The following exhibits are being furnished herewith:

 

Exhibit No.	Description of Exhibit
10.1	Convertible Credit Agreement, dated December 14, 2023, by Value Exchange International, Inc. and Hapi Metaverse, Inc. [CERTAIN COMMERCIALLY SENSITIVE AND NON-MATERIAL INFORMATION HAS BEEN DELETED FROM THIS EXHIBIT]
10.2	Amendment Number One to the Convertible Credit Agreement, dated December 19, 2023, by Value Exchange International, Inc. and Hapi Metaverse, Inc.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

 

VALUE EXCHANGE INTERNATIONAL, INC.

 

By:	/s/ Tan Seng Wee
Name:	Tan Seng Wee
Title:	Chief Executive Officer and President
Date:	December 20, 2023

 

 

Exhibit Index

 

Exhibit No.	Description of Exhibit
10.1	Convertible Credit Agreement, dated December 14, 2023, by Value Exchange International, Inc. and Hapi Metaverse, Inc. [CERTAIN COMMERCIALLY SENSITIVE AND NON-MATERIAL INFORMATION HAS BEEN DELETED FROM THIS EXHIBIT]
10.2	Amendment Number One to the Convertible Credit Agre ement, dated December 19, 2023, by Value Exchange International, Inc. and Hapi Metaverse, Inc.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

8

 

 

 

Exhibit 10.1

 

CONVERTIBLE CREDIT AGREEMENT

 

THIS CONVERTIBLE CREDIT AGREEMENT (this “Agreement”), dated and effective as of December     14    , 2023 (the “Effective Date”), is made by Hapi Metaverse Inc., a Delaware corporation (the “Lender”) and Value Exchange International, Inc., a Nevada corporation (the “Borrower” and together with the Lender, each a “Party” and together the “Parties”).

 

Background:

 

A.

The Lender desires to provide, at the option of the Lender, a credit line to the Borrower, and the Borrower desires to receive from the Lender a credit line (the “Loan”) that provides a maximum, aggregate credit line of ONE MILLION UNITED STATES DOLLARS (US$1,000,000.00) (the “Credit Line Amount” being the maximum possible principal of the Loan) and to do so pursuant to the terms of this Agreement.

 

B.

Any advance of money under the Credit Line by the Lender to the Borrower will be referred to as an “Advance”. “Person” means a natural person, corporation, partnership, limited partnership, limited liability company, business trust, other trust, organization, association, governmental authority or entity or other entity – in which instance who is not a Party or an Affiliate of a Party. “Business Days” means a weekday that the banks in Hong Kong Special Administrative Region of the People’s Republic of China (Hong Kong) are open for business on regular operating hours. “Affiliates” has the meaning in 17 Code of Federal Regulations §230.405.

 

Intending to be legally bound, the Parties agree:

 

1.       Loan; Closing. (a) Terms of Loan. Upon and after the Effective Date, the Lender shall extend to the Borrower a credit line for a maximum amount equal to an amount not exceeding the Credit Line Amount. From time to time during the term of this Agreement, the Borrower may request an advance on the Credit Line in accordance with the instructions set forth Exhibit A hereto (each being an “Advance Request”) from the Lender. The Lender will advise the Borrower within three (3) Business Days after receipt of an Advance Request if the Lender will make an Advance to the Borrower and the amount of the Advance. The Lender may refuse any Advance Request made by the Borrower without cause and without explanation or offer to fund an amount less than requested by the Borrower. Neither this Agreement nor any provision herein will obligate the Lender to approve any Advance Request. If the Lender approves any Advance Request, the advance of money under that Advance Request will be made within ten (10) days after approval of the Advance Request by the Lender, as the case may be, by wire transfer to the Borrower’s bank account listed in Exhibit A hereto. Each Advance shall bear a simple interest rate of eight percent (8%) per annum (based upon a 365- day year. Each Advance and all accrued but unpaid interest thereon shall, at the discretion of the Lender, either (i) be repaid in cash and/or (ii) convert into shares of common stock of the Borrower (the “Common Stock”) as provided in Section 2 below on and shall be due and payable on the third (3^rd) anniversary of the date that the Advance is received by the Borrower in good funds on deposit (the “Advance Maturity Date”). An Advance Maturity Date may be extended by the Lender who made the Advance for a one-time extension not to exceed the thirty (30) consecutive days immediately following the Advance Maturity Date. Each Advance shall not be secured by a lien or other encumbrance on any Borrower assets (including, without limitation, ownership interests in the Borrower’s subsidiaries or assets of any of Borrower’s subsidiaries) but shall be solely a general unsecured debt obligation of the Borrower.

 

(b)      Payment of Principal and Interest. The Borrower shall pay the unpaid principal amount of an Advance that has not been previously converted into the “Securities” (as defined below) on or before that the Advance Maturity Date along with any unpaid interest accrued on that Advance. Prior to the Advance Maturity Date, unpaid interest accrued on any Advance shall be paid on the last Business Day of June and on the last Business Day of December of each year in which the Advance is outstanding and not converted into Securities.

 

 

(c)       Warrants. In the event that the Lender elects to convert any portion of an Advance into shares of Common Stock in accordance with Section 2 below and in lieu of cash payment in satisfaction of that Advance, then and only then shall the Borrower issue to the Lender five (5) detachable warrants for each share of Common Stock issued in a Conversion (“Warrants”) in addition to the shares of Common Stock issued in the Conversion as defined under Section 2 below. Each Warrant will entitle the Lender to purchase one (1) share of Common Stock (“Warrant Shares”) at a per-share exercise price equal to the “Conversion Price” (as defined below). Each Warrant will be registered in the name of the Lender who requested the Conversion, or in a nominee name as designated by the Lender. The exercise period for each Warrant will be five (5) years from the date of issuance of the Warrant. Any nominee of the Lender must meet any compliance requirements for an investor under the exemption from registration of the Securities under applicable securities laws and regulations.

 

(d)       Origination Fee. An origination fee of ten percent (10%) of the Advance (the “Origination Fee”) shall be accrued and is payable in cash by the Borrower to the Lender and/or converted into shares of Common Stock of the Borrower as provided in Section 2 below, upon one (1) month from the date of issuance of the Notice of Conversion.

 

(e)       Prepayment. The Borrower may, at its option, at any time during the term of this Agreement, prepay a portion or all amounts of the outstanding Advance to the Lender, without incurring penalties, additional interest, or other fees or charges.

 

(f)       Additional Definitions. “Closing” means the date on which all conditions in Section 4 are completed and “Closing Date” means the date of the Closing. “Securities” means shares of Common Stock and Warrants issued or issuable under this Agreement to the Lender or its nominees or assignees and shares of Common Stock issuable or issued upon exercise of the Warrants.

 

2.        Conversion of Loan. (a) Optional Conversion. (i) Each Advance shall be convertible, in whole or in part, into shares of Common Stock, at the option of either Party (being referred to as a “Conversion”), at any time and from time to time, at a price per share equal the “Conversion Price” (as defined below), subject to adjustment as provided herein. The Lender shall effect conversions by delivering to the Borrower a Notice of Conversion, the form of which is attached hereto as Exhibit B (a “Notice of Conversion”), specifying therein the amount of the Advance and accrued interest, if any, to be converted, and the date on which such conversion shall be effected (such date, the “Conversion Date”). If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion is deemed received by the Borrower at its principal executive offices by a senior officer of the Borrower. Conversions hereunder shall have the effect of lowering the Advance in an amount equal to the amount of the Advance that is converted in a Conversion. The Lender and the Borrower shall maintain records showing the amount of the Advance converted and the date of each Conversion.

 

(ii)       Conversion Price. The price for conversion of an Advance into shares of Common Stock is US$0.045 per share, which is based on twenty-five percent (25%) discount of the Borrower’s market closing price as of 12 December 2023 (the “Conversion Price”).

 

(iii)       Conversion Procedure. The Conversion procedure set forth in Section 2(a)(i) above will be followed by the Lender in any Conversion under Sections 2(b), (c) and (d).

 

(b)        Conversion at Maturity Date. (i) To the extent that any Advances are not earlier repaid in cash or converted pursuant to the provisions of this Section 2, on the Advance Maturity Date, the amount of the Advances not previously converted into Securities under this Agreement, or any portion thereof, owed to the Lender may be converted by the Lender into shares of Common Stock at the Conversion Price.

 

 

(c)        Conversion upon a Change in Control Transaction. In the event that prior to the time of repayment of any Advance that has not previously been converted into Securities, the Borrower shall consummate a “Change in Control Transaction” (as defined below), then the total amount of Advances outstanding and not previously converted into Securities shall convert into shares of Common Stock at the Conversion Price upon receipt of written notice from the Lender to the Borrower, subject to adjustment as provided herein. “Change in Control Transaction” will be deemed to exist if (i) there occurs any consolidation, merger or other business combination of the Borrower with or into any Person and the Borrower is not the surviving entity, or any other corporate reorganization or transaction or series of related transactions in which in any of such events the voting stockholders of the Borrower prior to such event cease to own 50% or more of the voting power, or corresponding voting equity interests, of the surviving entity after the transaction or transactions, or (ii) in one or a series of related transactions, there is a sale or transfer of all or substantially all of the operating assets of the Borrower or substantially all of the Borrower’s equity interests in the operating and wholly-owned subsidiaries, determined on a consolidated basis, to a third party.

 

(d)       Conversion upon Breach of this Agreement. In the event that the Borrower breaches any provision of this Agreement and does not remedy that breach within thirty (30) days after receipt of a written demand from the Lender (“Demand”), which Demand shall describe the breach, (a “Conversion Breach Event”), then the Lender may convert all or any portion of the unpaid amount of Advance or Advances into shares of Common Stock at the Conversion Price. Upon occurrence of a Conversion Breach Event that is not timely remedied and receipt of a Notice of Conversion, the Borrower shall convert the requested Conversion amount of all outstanding amount of Advances not previously converted into Securities into shares of Common Stock within ten (10) days after receipt of the Notice of Conversion and in accordance with this Section 2.

 

(e)       Cancellation. In the event all Advances are paid in full by cash or are converted into shares of Common Stock, the Lender shall surrender all executed originals of this Agreement to the Borrower along with all promissory notes executed to evidence any Advance and all of such originals of this Agreement and each of the promissory notes shall be thereupon cancelled and marked “paid in full” on its face.

 

(f)       No Fractional Shares. No fractional shares shall be issued upon the Conversion of any Advances or any portion thereof. In the Lender’s sole discretion, the Borrower shall either pay to the Lender in cash the unconverted amount that would otherwise be converted into such factional share or interest in a share, or round the shares being issued upon Conversion up to the nearest whole number.

 

(g)       Sufficient Authorized Shares. The Borrower covenants that it will at all times reserve and keep available out of its authorized and unissued shares of Common Stock for the sole purpose of issuance upon Conversion of all possible Advances under this Agreement, free from preemptive rights or any other actual contingent purchase rights of persons other than the Lender or any Affiliates of the Lender, not less than such number of shares of Common Stock issuable upon conversion of the all outstanding Advances not previously converted into Securities hereunder. The Borrower covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable and free and clear of any lien or encumbrance.

 

(h)       Stamp Tax. The issuance of shares of Common Stock on Conversion of any Advances or any portion thereof shall be made without charge to the Lender, as the case may be, for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such shares upon conversion.

 

(i)       Restricted Securities. The Lender understands that the shares of Common Stock issuable upon conversion of the Advances, the Warrants and the shares of Common Stock issuable upon exercise of any Warrant will be “restricted securities” within the meaning of Rule 144 under the Securities Act of 1933, as amended (the “1933 Act”) and may not be sold, pledged, assigned or transferred and must be held indefinitely in the absence of (i) an effective registration statement under the 1933 Act and applicable state securities laws with respect thereto or (ii) an available exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act as evidenced by an opinion of counsel satisfactory to the Borrower that such registration is not required. The certificates for the Common Stock issuable upon conversion of the Advances or any Advance or upon exercise of any Warrants shall bear the following or similar legend (in addition to such other restrictive legends as are required or deemed advisable under any applicable law by Borrower or any other agreement to which the Borrower is a party):

 

 

“THE SECURITIES REPRESENTED HEREBY OR ISSUABLE UPON EXERCISE OF THOSE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE 1933 ACT, OR UNDER THE SECURITIES LAWS OF ANY STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE SOLD, DISTRIBUTED, OFFERED, PLEDGED, ENCUMBERED, ASSIGNED OR OTHERWISE TRANSFERRED, EXCEPT AS PERMITTED UNDER THE 1933 ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION, AN AVAILABLE EXEMPTION THEREFROM, OR A TRANSACTION NOT SUBJECT TO THE REGISTRATION REQUIREMENTS OF THE 1933 ACT OR UNDER THE SECURITIES LAWS OF ANY STATES. UNLESS SOLD PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE 1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS.”

 

(j)       Other Legends. The Lender consents to the Borrower making a notation on the Borrower’s records or giving instructions to any transfer agent of the Common Stock in order to implement the restrictions on transfer set forth and described herein on the shares of Common Stock and Warrants and shares of Common Stock issued or issuable upon exercise of Warrants. Further, certificates shall also bear any legend required by the securities laws of any state to the extent such laws are applicable to the Securities represented by the certificate so legended.

 

3.       Use of Proceeds. The Borrower shall use the funds of each Advance for working capital, including expansion of existing business operations or business lines to new geographical markets in Asia or other geographical markets; for development of new business lines (whether in existing or new geographical markets); acquisition of assets or companies (whether in existing or new geographical markets); and payment of any sums due under this Agreement or other credit or loan agreement with the Lender, if any.

 

4.       Closing Conditions. (a) The obligations of the Borrower hereunder in connection with the Closing are subject to the following conditions being met:

 

(i)       the accuracy in all material respects on the Closing Date of the representations and warranties of the Lender contained herein (unless as of a specific date therein in which case it shall be accurate as of such date);

 

(ii)       all obligations, covenants and agreements of the Lender required to be performed at or prior to the Closing Date shall have been performed;

 

(iii)       the delivery by the Lender of a completed and signed original of this Agreement as well as any other documents and agreements reasonably necessary to consummate the Closing; and

 

(iv)       the Lender has provided a completed and signed investor questionnaire provided by the Borrower to the Lender.

 

 

(b)       The respective obligations of the Lender hereunder in connection with the Closing are subject to the following conditions being met:

 

(i)       the accuracy in all material respects when made and on the Closing Date of the representations and warranties of the Borrower contained herein (unless as of a specific date therein);

 

(ii)      all obligations, covenants and agreements of the Borrower required to be performed at or prior to the Closing Date shall have been performed;

 

(iii)      the delivery by the Borrower of a completed and signed original of this Agreement as well as any other documents and agreements reasonably necessary to consummate the Closing;

 

(iv)      there shall have been no Material Adverse Effect with respect to the Borrower since the Effective Date; and

 

(v)       from the date hereof to the Closing Date, trading in the Common Stock shall not have been suspended by the United States of America (U.S.) Securities and Exchange Commission (SEC) or by the Borrower’s principal U.S. public market for its Common Stock (“Trading Market”) and at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg or any successor stock quotation service shall not have been suspended or limited.

 

(c)       Each Party shall in good faith and diligently remedy any condition set forth above that is an obligation of that Party upon written notice from any other Party. All conditions to the Closing set forth above in Sections 4(a) and (b) will be deemed satisfied if no Party objects in a written notice to the other Parties within five (5) days after the Effective Date.

 

5.       Events of Default. (a) The following shall constitute events of default (each an “Event of Default”): (i) default shall be made in the payment of any Advance when due and payable under this Agreement and the Borrower fails to cure such default within ten (10) days after receipt of a written notice of default from the Lender or its authorized agent is received by the Borrower;

 

(ii)      there is a default by the Borrower in the observance or performance of any non- monetary material covenant or agreement contained herein and the Borrower fails to cure such default within thirty (30) days after written notice of default from the Lender or its authorized agent is received by the Borrower (or within such other longer time period as may be therein specifically provided);

 

(iii)     failure of the Borrower to comply with the obligations, terms, covenants or conditions contained in this Agreement, or breach by the Borrower of any obligations, covenant, representation or warranty contained in this Agreement that is not cured within thirty (30) days from the receipt of a written notice from a Lender or its authorized agents by Borrower, which written notice will state the specific failure or breach by the Borrower;

 

(iv)      filing of a petition in bankruptcy or the commencement of any proceedings under any bankruptcy laws by or against the Borrower, which filing or proceeding, is not dismissed within sixty (60) days after the filing or commencement thereof, or if the Borrower shall become, or in light of its usual business conditions is likely to become, insolvent and is unable to pay its debts or liabilities as they fall due;

 

(v)       a petition to a court of competent jurisdiction shall be filed for the entry of an order, judgment or decree approving a petition filed against the Borrower seeking any reorganization, dissolution or similar relief under any present or future federal, state or other statute, law or regulation relating to bankruptcy, insolvency or other relief for debtors, and such petition shall remain unvacated or not removed for an aggregate of sixty (60) days (whether or not consecutive) from the first date of entry thereof or rejected by such court; or any trustee, receiver or liquidator of the Borrower or of all or any part of the assets, or of any or all of the royalties, revenues, rents, issues or profits thereof, shall be appointed without the consent or acquiescence of the Borrower and such appointment shall remain unvacated and unstayed for an aggregate of sixty (60) days (whether or not consecutive);

 

 

(vi)       for debts or judgments in excess of One Hundred Thousand United States Dollars (US$100,000.00) in face amount, a writ of execution or attachment or any similar process shall be issued or levied against all of the Borrower’s assets, or any judgment involving monetary damages shall be entered against the Borrower which shall become a lien on all of the Borrower’s assets and such execution, attachment or similar process or judgment is not released, bonded, satisfied, vacated or stayed within sixty (60) days after its entry or levy; or

 

(vii)       the Borrower ceases to carry on its primary business line for ninety (90) consecutive days.

 

(b)    Accelerated Payment; No Presentment. If, at any time, an Event of Default shall occur and is not timely remedied, then the unpaid amount of all Advances shall become immediately due and payable without presentment, demand or protest, all of which are hereby waived by the Borrower.

 

6.       The Borrower’s Warranties and Representations. The Borrower represents and warrants to the Lender as of the Effective Date and as of the Closing Date as follows:

 

(a)       Good Standing. The Borrower and each of its wholly-owned subsidiaries is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Borrower nor any of its wholly-owned subsidiaries is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents. Each of the Borrower and its wholly-owned subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of this Agreement, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Borrower and its wholly-owned subsidiaries, taken as a whole, or (iii) a material adverse effect on the Borrower’s ability to perform in any material respect on a timely basis its payment obligations under this Agreement (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification. The execution and performance of this Agreement by the Borrower have been duly authorized by all necessary corporate actions.

 

(b)      No Conflict. The execution and performance of this Agreement by the Borrower have been duly authorized by all necessary actions. This Agreement has been duly executed and delivered by the Borrower and is the legal, valid, and binding obligation of the Borrower and is fully enforceable against the Borrower according to its terms.

 

(c)       Non-Assessable Shares. All of the shares of Common Stock to be issued upon any Conversion of the unpaid amount due under any Advances shall be, when issued, duly authorized, validly issued, fully paid, non-assessable free and clear of all liens, pledges, security interests, charges and encumbrances.

 

 

(d)       Compliance. Neither the Borrower nor any of its wholly-owned subsidiaries (to the best of their respective knowledge as of the Closing Date): (i) is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Borrower or any of its wholly-owned subsidiaries under), nor has the Borrower or any of its wholly-owned subsidiaries received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse Effect.

 

(e)       Money Laundering. The operations of the Borrower and its wholly-owned subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Borrower or any of its wholly- owned subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Borrower or any of its wholly owned subsidiaries, threatened.

 

(f)       Regulation M Compliance. The Borrower has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Borrower to facilitate the sale or resale of any of the securities issuable under this Agreement, (ii) sold, bid for, purchased, or, paid any compensation for soliciting purchases of, any of those securities, or (iii) paid or agreed to pay to any entity or person any compensation for soliciting another to purchase any other securities of the Borrower issuable under this Agreement.

 

(g)       Office of Foreign Assets Control. Neither the Borrower nor any of its wholly owned subsidiaries nor, to the Borrower’s knowledge, any director, officer, agent, employee or affiliate of the Borrower or any of its wholly owned subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (OFAC).

 

(h)       Foreign Corrupt Practices. Neither the Borrower nor any of its wholly owned subsidiaries, nor to the knowledge of the Borrower, any agent or other person acting on behalf of the Borrower, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Borrower or any of its wholly-owned subsidiaries (or made by any person acting on its behalf of which the Borrower is aware) which is in violation of law, or (iv) violated in any material respect any provision of Foreign Corrupt Practices Act, as amended.

 

(i)       No Injunction. No statute, regulation, order, decree, writ, ruling or injunction shall have been enacted, entered, promulgated, threatened or endorsed by any court or governmental authority of competent jurisdiction which prohibits the consummation of or which would materially modify or delay any of the transactions contemplated by this Agreement.

 

(j)      No Proceedings or Litigation. No action, suit or proceeding before any arbitrator or any court or governmental authority shall have been commenced, and no inquiry or investigation by any governmental authority shall have been commenced, against the Borrower or any of its wholly- owned subsidiaries, or any of the officers, directors or affiliates of the Borrower or any of its wholly- owned subsidiaries, seeking to restrain, prevent or change the transactions contemplated by this Agreement, or seeking material damages in connection with such transactions.

 

7.       The Lender’s Warranties and Representations. The Lender hereby represents and warrants as of the date hereof and as of the Closing Date to the Borrower as follows (unless as of a specific date is stated therein):

 

 

(a)       Good Standing. The Lender is an entity duly incorporated or formed, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability company or similar power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement and performance by the Lender of the transactions contemplated by this Agreement have been duly authorized by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the part of the Lender. This Agreement has been duly executed by the Lender, and when delivered by the Lender in accordance with the terms hereof, will constitute the valid and legally binding obligation of the Lender, enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors' rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law. The execution and performance of this Agreement by the Lender have been duly authorized by all necessary corporate actions.

 

(b)       Investment Intent. The Securities are being acquired for the Lender’s own account, for investment purposes only, and not as nominee or agent, and not with a view to, or for resale in connection with, any distribution or public offering thereof within the meaning of the 1933 Act.

 

(c)       Knowledge. The Lender has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in connection with the transactions contemplated in this Agreement. The Lender has, in connection with its decision to purchase the securities hereunder, relied only upon the representations and warranties contained herein. Further, the Lender has had such opportunity to obtain additional information and to ask questions of, and receive answers from, the Borrower, concerning the terms and conditions of the investment and the business and affairs of the Borrower, as the Lender considers necessary in order to form an investment decision. The Lender has reviewed filings by the Borrower with the SEC and has had an opportunity to ask questions about the Borrower and its Securities and to receive answers to those questions prior to the Effective Date.

 

(d)       Accredited Investor. The Lender is an “accredited investor” as such term is defined in Rule 501(a) of the rules and regulations promulgated under the 1933 Act or is a sophisticated investor knowledgeable about risks of an investment in the Borrower’s Securities and knowledgeable about the business and industry of the Borrower, either directly or through a personal representative. The Lender has a substantive, pre-existing business relationship with the Borrower. The Lender is not purchasing the Borrower’s securities hereunder as a result of any advertisement, article, notice or other communication regarding the securities published in any newspaper, magazine or similar media or broadcast over the television or radio or presented at any seminar or any other general solicitation or general advertisement. The Lender has a pre-existing and substantive business relationship with the Borrower. Prior to signing this Agreement, the Lender has: (i) had an opportunity to ask questions about the business and financial affairs of the Borrower and about the Securities and to receive answers to those questions from the Borrower; and (ii) had an opportunity to review the filings made by the Borrower with the SEC.

 

(e)      No Injunction. No statute, regulation, order, decree, writ, ruling or injunction shall have been enacted, entered, promulgated, threatened or endorsed by any court or governmental authority of competent jurisdiction which prohibits the consummation of or which would materially modify or delay any of the transactions contemplated by this Agreement.

 

(f)      No Proceedings or Litigation. No action, suit or proceeding before any arbitrator or any court or governmental authority shall have been commenced, and no inquiry or investigation by any governmental authority shall have been commenced, against the Lender or any of its wholly-owned subsidiaries, or any of the officers, directors or affiliates of the Lender or any of its wholly-owned subsidiaries, seeking to restrain, prevent or change the transactions contemplated by this Agreement, or seeking material damages in connection with such transactions.

 

 

(g)       Money Laundering. The operations of the Lender and its wholly-owned subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping and reporting requirements of the Money Laundering Laws (as defined above), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Lender or any of its wholly-owned subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Lender or any of its wholly owned subsidiaries, threatened.

 

(h)      Office of Foreign Assets Control. Neither the Lender nor any of its wholly owned subsidiaries nor, to the Lender’s knowledge, any director, officer, agent, employee or affiliate of the Lender or any of its wholly owned subsidiaries is currently subject to any U.S. sanctions administered by the OFAC.

 

8.       Securities Law Compliance. Each Party agrees, represents and warrants to the other Parties as follows that the Party will cooperate with the other Parties in ensuring that the transactions contemplated under this Agreement comply with all applicable federal and state securities laws and regulations. The Borrower will file a Form D with the SEC and applicable states for the issuance of Securities under this Agreement. The Lender will promptly complete and sign an investor questionnaire and other documents or instruments reasonably required under applicable federal and state securities laws and regulations as provided by the Borrower and timely tender that investor questionnaire and those other documents and instruments as part of the compliance with federal and state securities law compliance under this Agreement. The issuance of Securities under this Agreement is intended to be exempt from registration under the 1933 Act under Rule 506(b) of Regulation D under the 1933 Act. The Lender agrees to supply as and when requested by the Borrower any documents or information required to ensure compliance with applicable federal and state securities laws and regulations.

 

9.       Piggyback Registration Rights. (a)(i) Defined Terms. “Holder” means the owner of record of any securities of the Borrower issued or issuable under this Agreement. “Registrable Securities” means any of the Borrower’s Securities issued or issuable under this Agreement.

 

(ii) Piggyback Registration. The Borrower will notify all Holders of Registrable Securities in writing at least thirty (30) days prior to filing any registration statement under the 1933 Act for purposes of effecting a public offering of securities of the Borrower (including, but not limited to, registration statements relating to secondary offerings of securities of the Borrower, but excluding registration statements relating to any employee benefit plan or a corporate reorganization) and will afford each such Holder an opportunity to include in such registration statement all or any part of the Registrable Securities then held by such Holder. Each Holder desiring to include in any such registration statement all or any part of the Registrable Securities held by such Holder will, within twenty (20) days after receipt of the above-described notice from the Borrower, so notify the Borrower in writing, and in such notice will inform the Borrower of the number of Registrable Securities such Holder wishes to include in such registration statement. If a Holder decides not to include all of its Registrable Securities in any registration statement thereafter filed by the Borrower, such Holder will nevertheless continue to have the right to include any Registrable Securities in any subsequent registration statement or registration statements as may be filed by the Borrower with respect to offerings of its securities, all upon the terms and conditions set forth herein.

 

 

(b)       Underwriting. If a registration statement under which the Borrower gives notice under this Section 9 is for an underwritten offering, then the Borrower will so advise the Holders of Registrable Securities. In such event, the right of any such Holder’s Registrable Securities to be included in a registration pursuant to this Section 9 will be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their Registrable Securities through such underwriting will enter into an underwriting agreement in customary form with the managing underwriter or underwriter(s) selected for such underwriting. Notwithstanding any other provision of this Agreement, if the managing underwriter(s) determine(s) in good faith that marketing factors require a limitation of the number of shares to be underwritten, then the managing underwriter(s) may exclude shares (including Registrable Securities) from the registration and the underwriting, and the number of shares or other Securities that may be included in the registration and the underwriting will be allocated, first, to the Borrower, and second, to each of the Holders requesting inclusion of their Registrable Securities in such registration statement on a pro rata basis based on the total number of Registrable Securities then held by each such Holder. If any Holder disapproves of the terms of any such underwriting, such Holder may elect to withdraw therefrom by written notice to the Borrower and the underwriter, delivered at least ten (10) Business Days prior to the effective date of the registration statement. This withdrawal right shall be the sole recourse of the Holder in any instance of an underwriter or underwriters, as the case may be, for any exclusion of Registrable Securities from registration. Any Registrable Securities excluded or withdrawn from such underwriting will be excluded and withdrawn from the registration. For any Holder which is a partnership or corporation, the partners, retired partners and shareholders of such Holder, or the estates and family members of any such partners and retired partners and any trusts for the benefit of any of the foregoing persons will be deemed to be a single “Holder,” and any pro rata reduction with respect to such “Holder” will be based upon the aggregate amount of shares carrying registration rights owned by all entities and individuals included in such “Holder,” as defined in this sentence.

 

(c)       Expenses. All expenses incurred in connection with a registration pursuant to this Section 9 (excluding underwriters’ and brokers’ discounts and commissions), including, without limitation, all federal and “blue sky” registration and qualification fees, printers’ and accounting fees, fees and disbursements of counsel for the Borrower and the reasonable fees and disbursements of one (1) counsel for the selling Holders will be borne by the Borrower.

 

(d)       Obligations of the Borrower. Whenever required to effect the registration of any Registrable Securities under this Agreement, the Borrower will, as expeditiously as reasonably possible:

 

(i)       Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use its best efforts to cause such registration statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for up to ninety (90) days;

 

(ii)      Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the 1933 Act with respect to the disposition of all securities covered by such registration statement;

 

(iii)      Furnish to the Holders such number of copies of a prospectus including a preliminary prospectus, in conformity with the requirements of the 1933 Act, and such other documents as they may reasonably request in order to facilitate the disposition of the Registrable Securities owned by them that are included in such registration;

 

(iv)       Use its good faith and diligent efforts to register and qualify the securities covered by such registration statement under such other securities or Blue Sky laws of such jurisdictions as will be reasonably requested by the Holders, provided the Borrower will not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions, unless already conducting business therein; and

 

(v)       In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter(s) of such offering (it being understood and agreed, as a condition to the Borrower’s obligations under this clause (v), each Holder participating in such underwriting will also enter into and perform its obligations under such an underwriting or underwriter’s agreement).

 

(e)       Notice. Notify each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the 1933 Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing.

 

 

(f)       Deliverables. Furnish, at the request of any Holder requesting registration of Registrable Securities, on the date such Registrable Securities are delivered to the underwriters for sale, if such Securities are being sold through underwriters, or, if the Securities are not being sold through underwriters, on the date the registration statement with respect to such securities becomes effective, (i) an opinion, dated as of such date, of the counsel representing the Borrower for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering and reasonably satisfactory to a majority in interest of the Holders requesting registration, addressed to the underwriters, if any, and to the Holders requesting registration of Registrable Securities and (ii) a “comfort” letter dated as of such date, from the independent certified public accountants of the Borrower, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering and reasonably satisfactory to a majority in interest of the Holders requesting registration, addressed to the underwriters, if any, and to the Holders requesting registration of Registrable Securities.

 

(g)       Furnish Information. It will be a condition precedent to the obligations of the Borrower to take any action pursuant to Section 9 that the selling Holders will furnish to the Borrower such information regarding themselves, the Registrable Securities held by them and the intended method of disposition of such securities as will be required to timely effect the registration of their Registrable Securities and comply with applicable U.S. federal securities laws and regulations.

 

(h)       Delay of Registration. No Holder will have any right to obtain or seek an injunction restraining or otherwise delaying any such registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Section 9. This Subsection 9(h) may be presented in any legal or administrative proceeding as, and shall constitute, a bar to any legal or administrative action by a Holder in violation of this Subsection 9(h).

 

10.       Termination. This Agreement may be terminated upon mutual agreement of both Parties.

 

11.       Waiver. The Borrower, for itself and each of its legal representatives, hereby waives presentment for payment, demand, right of setoff, notice of nonpayment, notice of dishonor, protest of any dishonor, notice of protest and protest of this Agreement, and all other notices in connection with the delivery, acceptance, performance, default or enforcement of the obligations under this Agreement.

 

12.       Further Assurances. The Parties shall each perform such further acts and execute such further documents as may reasonably be necessary to carry out and give full effect to the provisions of this Agreement.

 

13.       Miscellaneous. (a) Entire Agreement; Amendments. This Agreement constitutes the entire understanding of the Parties with respect to the subject matter hereof and supersedes all prior written and oral understandings of the Parties with regard thereto. This Agreement may be modified, amended, or any term hereof waived only in writing by the Borrower and the Lender. Any amendment effected in accordance with this Section 13(a) shall be binding upon both Parties and their respective successors and assignees.

 

(b)       Governing Law; Jurisdiction. This Agreement shall be governed by and construed according to the laws of the State of Delaware without regard to the conflict of law provisions thereof. Any dispute arising under or in relation to this Agreement shall be resolved exclusively in the U.S. District Court for the District of Delaware and states courts of the State of Delaware, including appellate courts thereto, (collectively, the “Delaware Courts”) and each of the Parties hereby submits irrevocably to the exclusive jurisdiction of the Delaware Courts and agrees that these courts are a convenient forum. Each Party waives any claim of forum non conveniens in respect of the Delaware Courts.

 

 

(c)       WAIVER OF JURY TRIAL. IN ANY ACTION SUIT OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.

 

(d)       Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, the Lender and the Borrower will be entitled to specific performance under this Agreement. The Parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in this Agreement and hereby agree to waive and not to assert in any action for specific performance of any such obligation the defense that a remedy at law would be adequate.

 

(e)       Notices. (i) All notices and other communications required or permitted hereunder to be given to a Party to this Agreement shall be in writing and shall be telecopied/emailed or mailed by registered or certified mail, postage prepaid, or otherwise delivered by hand or by messenger. Any notice sent in accordance with this Agreement shall be effective (i) if mailed, seven (7) Business Days after mailing to the address set forth below for the recipient Party, (ii) if sent by messenger, upon delivery, at the notice address set forth below for the recipient Party, and (iii) if sent via telecopier/email, upon transmission and electronic confirmation of receipt or (if transmitted and received on a non-Business Day) on the first Business Day following transmission and electronic confirmation of receipt using the telecopier or email address set forth below for the recipient Party.

 

To the Borrower:

 

Value Exchange International, Inc.

Address: Unit 602, Block B, 6 Floor, Shatin Industrial Centre, 5-7 Yuen Shun Circuit, Shatin, N.T., Hong Kong

Telephone: (852) 2950 4288 Attention to: Kenneth Tan

Email: 65.VEII.CG@value-exch.com

 

To the Lender:

 

Hapi Metaverse Inc.

Address: 4800 Montgomery Lane, Suite 210, Bethesda, Maryland, 20814 U.S. Telephone: (301) 971 3940

Attention to: Nathan Lee

Email: nathan@gigworldinc.com

 

(f)       Assignment; Waiver. This Agreement may not be assigned by either Party without the prior written consent of the other Party. This Agreement shall be binding upon the successors, assigns and representatives of each Party. No delay or omission to exercise any right, power, or remedy accruing to any Party upon any breach or default under this Agreement, shall be deemed a waiver of any other breach or default theretofore or thereafter occurring. All remedies, either under this Agreement or by law or otherwise afforded to any of the Parties, shall be cumulative and not alternative.

 

(g)       Severability. If any provision of this Agreement is held by a court of competent jurisdiction to be unenforceable under applicable law, then such provision shall be excluded from this Agreement and the remainder of this Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms; provided, however, that in such event this Agreement shall be interpreted so as to give effect, to the greatest extent consistent with and permitted by applicable law, to the meaning and intention of the excluded provision as determined by such court of competent jurisdiction.

 

 

(h)       Counterparts. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each Party and delivered to each other Party, it being understood that the Parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by e-mail delivery of a “.PDF” format data file, such signature shall create a valid and binding obligation of the Party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.PDF” signature page was an original thereof.

 

(i)       Construction. The Parties agree that each of them and their respective counsel have reviewed and had an opportunity to revise this Agreement and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting Party shall not be employed in the interpretation of this Agreement or any amendments thereto.

 

(j)       Payment Set Aside. To the extent that the Borrower makes a payment or payments to the Lender pursuant to this Agreement, or the Lender enforces or exercises its rights thereunder, and the Borrower’s payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Borrower, a trustee, receiver or any other person or entity under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

 

(k)       Replacement of Securities. If any certificate or instrument evidencing any Borrower securities is mutilated, lost, stolen or destroyed, the Borrower shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Borrower of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs associated with the issuance of such replacement securities and shall pay the costs incurred by the Borrower to replace the certificate or instrument of the securities.

 

(l)       Survival. The representations and warranties contained herein shall survive the Closing for one (1) year.

 

(m)       Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.

 

(n)       Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their successors and permitted assigns.

 

(o)       No Third-Party Beneficiaries. This Agreement is intended for the benefit of the Parties and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other entity or person.

 

[The remainder of this page is intentionally left blank.]

 

 

IN WITNESS WHEREOF, the Parties have executed this Convertible Credit Agreement as of the date first above written.

 

Borrower:

Value Exchange International, Inc.

 

 

 

 

 

 

Name:	Tan Seng Wee Kenneth
Title:	Chief Executive Officer
Lender:	Hapi Metaverse Inc.
Name:	Chan Heng Fai Ambrose
Title:	Executive Chairman

 

 

EXHIBIT A

 

WIRE INSTRUCTIONS

 

All payments of unpaid principal of an Advance will be made by wire transfer to the Lender’s bank account in the United States, which wire instructions will be provided to the Borrower by the Lender.

 

Wire Instructions for Payment of Advance to the Borrower:

 

Name of Bank: Bank of China (Hong Kong) Limited

Address of Bank: Shop A, 16-20 Ngan Shing Commercial Centre, City One, Sha Tin, New Territories, Hong Kong

Telephone Number of Bank: (852) 3982 7375

Contact at Bank: Tse Yu Kei

Name of Accountholder: Value Exchange Int’l (China) Limited

Address of Accountholder: Unit 602, Block B, 6 Floor, Shatin Industrial Centre, 5-7 Yuen Shun Circuit, Shatin, N.T., Hong Kong

Telephone Number of Accountholder: (852) 2950 4288

Account Number:

ABA Routing Number: N/A

Swift #: BKCHHKHHXXX

 

 

EXHIBIT B

 

NOTICE OF CONVERSION

 

To: Value Exchange International, Inc. Attention to: Chief Executive Officer

 

Date:_________________, 202_______

 

 

The undersigned hereby irrevocably elects to convert $__________________of the amount of an Advance into shares of Common Stock of Value Exchange International, Inc. according to the terms and conditions stated therein, as of the Conversion Date written below.

 

Conversion Calculations:

 

Date to Effect Conversion: ___________________

 

Principal Amount of Unpaid Advance to be Converted: $__________________

 

Accrued Interest on Advance to be Converted, if any: $__________________

 

Conversion Price: $__________________

 

Number of Conversion Shares: $__________________

 

Signature: _________________________________

 

Print Full Legal Name:_____________________________

 

Address for Delivery of Conversion Shares: _____________________________

 

 

_______________________________________________________________________

 

_______________________________________________________________________

 

or, if eligible:

 

DWAC Instructions: __________________

Broker No: __________________

Account No: __________________

 

 

16

 

 

 

Exhibit 10.2

 

Amendment Number One to the Convertible Credit Agreement

 

This Amendment Number One, dated and effective as of December 19, 2023 (“Effective Date”), (referred to as the “Amendment”) is made by Value Exchange International, Inc., a Nevada corporation, (“Borrower”) and Hapi Metaverse, Inc., a Delaware corporation, (“Lender”) and amends the Credit Agreement, dated and effective as of December 14, 2023, (“Credit Agreement”) by the Lender and Borrower. Borrower and Lender may also be referred to individually as a “Party” and collectively as the “Parties”.

 

Intending to be legally bound, the Parties agree:

 

1.       Amendment to Credit Agreement. Section 1(d) of the Credit Agreement, entitled “Origination Fee”, is deleted in its entirety and replaced by the following provision:

 

(d) Origination Fee. A fully-earned, non-refundable origination fee of One Hundred Thousand U.S. Dollars and No Cents (USD$100,000.00) (“Origination Fee”) will be due and payable by Borrower to Lender within thirty (30) days after the Effective Date. Borrower may elect to pay the Origination Fee in either cash or shares of Borrower’s Common Stock. If the Origination Fee is paid in shares of Borrower’s Common Stock, then those shares will be valued at the per share price set forth in Section 2(a)(ii) of the Credit Agreement for purposes of determining the number of shares issuable as payment of the Origination Fee.

 

2.       Integration. This Amendment and the Credit Agreement will be read and construed as a single instrument and agreement and any conflict or ambiguity between this Amendment and the Credit Agreement will be resolved by reference to this Amendment.

 

3.       Governing Law. This Amendment will be construed and governed by the laws of the State of Delaware, U.S.A., without reference to any state’s or jurisdiction’s conflict of law doctrines or rules. Any dispute arising under or in relation to this Amendment shall be resolved exclusively in the U.S. District Court for the District of Delaware and states courts of the State of Delaware, including appellate courts thereto, (collectively, the “Delaware Courts”) and each of the Parties hereby submits irrevocably to the exclusive jurisdiction of the Delaware Courts and agrees that these courts are a convenient forum. Each Party waives any claim of forum non conveniens in respect of the Delaware Courts.

 

4.       WAIVER OF JURY TRIAL. IN ANY ACTION SUIT OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST THE OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.

 

5.       Counterparts. This Amendment may be executed in one or more textually identical counterparts, all of which will be considered one and the same agreement and will become effective when one or more counterparts have been signed by each of the Parties and exchanged by the Parties. Further, Parties agree that all Parties need not sign the same counterpart. Any counterpart, to the extent delivered by fax or .pdf, .tif, .gif, ..jpg or similar attachment to electronic mail or by an electronic signature service (any such delivery, being referred to as an “Electronic Delivery”), will be treated in all manner and respects as an original executed counterpart and will be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. No Party may raise the use of an Electronic Delivery to deliver a signature, or the fact that any signature or agreement or instrument was transmitted or communicated through the use of an Electronic Delivery, as a defense to the formation of a legally binding agreement and each Party forever waives any such defense, except to the extent that such defense relates to lack of authenticity.

 

 

6.       Entire Agreement; Amendment. This Amendment represents the entire agreement of the Parties with respect to the matters stated herein and this Amendment may only be amended by a writing signed by all of the Parties.  

 

7.       Further Assurances. The Parties shall each perform any further acts and execute any further documents as may reasonably be necessary to carry out and give full effect to the provisions of this Amendment.

 

8.       Notices. All notices and other communications required or permitted hereunder to be given to a Party shall be in writing and shall be made in accordance with Section 13(e) of the Credit Agreement.

 

9.       Assignment; Waiver. This Amendment may not be assigned by either Party without the prior written consent of the other Party. This Amendment shall be binding upon the successors, assigns and representatives of each Party. No delay or omission to exercise any right, power, or remedy accruing to any Party upon any breach or default under this Amendment, shall be deemed a waiver of any other breach or default theretofore or thereafter occurring. All remedies, either under this Amendment or by law or otherwise afforded to any of the Parties, shall be cumulative and not alternative.

 

10.       Headings. The headings of this Amendment are for convenience of reference only and shall not form part of, or affect the interpretation of, this Amendment.

 

11.      Severability. In the event that any provision of this Amendment is invalid or unenforceable under any applicable statute or rule of law, then that provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of this Amendment.

 

12.     Mutual Drafting. This Amendment has been drafted with input from and the participation by all Parties, and, as such, no drafting presumption or strict construction shall be applied to any Party or other signatory to this Amendment.

 

IN WITNESS WHEREOF, the Parties have entered into this Agreement as of the Effective Date.

 

Value Exchange International, Inc., a Nevada corporation

 

By:
	Tan Seng Wee Kenneth, Chief Executive Officer

 

Hapi Metaverse, Inc., a Delaware corporation

 

By:
	Chan Heng Fai Ambrose, Executive Chairman of the Board of Directors

 

 

 

2

 

 

v3.23.4

Cover	Dec. 20, 2023
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Dec. 20, 2023
Entity File Number	000-53537
Entity Registrant Name	VALUE EXCHANGE INTERNATIONAL, INC.
Entity Central Index Key	0001417664
Entity Tax Identification Number	26-3767331
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	Unit 602, Block B, 6 Floor
Entity Address, Address Line Two	Shatin Industrial Centre
Entity Address, Address Line Three	5-7 Yuen Shun Circuit
Entity Address, City or Town	Shatin
Entity Address, Country	HK
Entity Address, Postal Zip Code	N.T.
City Area Code	(852)
Local Phone Number	2950 4288
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Entity Information, Former Legal or Registered Name	Not Applicable

---