Note 6. RELATED PARTY BALANCES AND TRANSACTIONS

Due to Alset Inc.

Alset Inc (“AEI”) is our ultimate holding company that is incorporated in the United States of America. The amount due to AEI represents short-term working capital advances to the Company for its daily operations. There is no written, executed agreement and no financial/non-financial covenants and the amount due to AEI is non-interest bearing. Since the amount due to AEI is due upon request, it is classified as a current liability. The original total amount due to AEI was $2,173,653, majority of which has been forgiven and treated as capital contribution in additional paid -in-capital (“APIC”), resulted in a balance of $347,353 as of March 31, 2026.

Due to Alset International Limited.

Alset International Limited (“AIL”) is incorporated in Singapore and is a fellow subsidiary of the common parent company, Alset Inc. The amount due to AIL represents short-term working capital advances to the Company for its daily operations. There is no written, executed agreement and no financial/non-financial covenants and the amount due to AIL is non-interest bearing. Since the amount due to AIL is due upon request, it is classified as a current liability. The original total amount due to AIL was $2,621,334, majority of which has been forgiven and treated as capital contribution in APIC, resulted in a balance of $114,658 as of March 31, 2026.

Due to Alset Business Development Pte. Limited.

Alset Business Development Pte. Limited (“ABD”) is incorporated in Singapore and is a fellow subsidiary of Alset Inc. The amount due from ABD represents short-term working capital advances for the Company to finance its daily operations. There is no written, executed agreement and no financial/non-financial covenants and the amount due to ABD is non-interest bearing. Since the amount due to ABD is due upon request, it is classified as a current liability. During the year ended March 31, 2026, ABD advanced additional $60,614 to the Company. The total cumulative advanced amount of $4,157,932 has been forgiven and treated as capital contribution in APIC, resulting in zero balance as of March 31, 2026.

Due to Hapi Robot Inc.

Hapi Robot Inc. (“HRI”) is incorporated in the United States of America, and is a fellow subsidiary of Alset Inc. The amount due from HRI represents payable to the Company for the investment in 40% ownership of HRI. There is no written, executed agreement and no financial/non-financial covenants and the amount due to HRI is non-interest bearing. Since the amount due to HRI is due upon request, it is classified as a current liability. The original total amount due to HRI was $4, all of which has been forgiven and treated as capital contribution in APIC, resulting in zero balance as of March 31, 2026.

Due to Alset Global Pte. Limited.

Alset Global Pte. Limited (“AGPL”) is incorporated in Singapore and is a fellow subsidiary of Alset Inc. The amount due from AGPL represents short-term working capital advances to the Company for its daily operations. There is no written, executed agreement and no financial/non-financial covenants and the amount due to AGPL is non-interest bearing. Since the amount due to AGPL is due upon request, it is classified as a current liability. The original total amount due to AGPL was $50,568, all of which has been forgiven and treated as capital contribution in APIC, resulting in zero balance as of March 31, 2026.

Due to Global eHealth Limited.

Global eHealth Limited (“GHL”) is incorporated in Hong Kong and is a fellow subsidiary of Alset Inc. The amount due from GHL represents short-term working capital advances to the Company for its daily operations. There is no written, executed agreement and no financial/non-financial covenants and the amount due to GHL is non-interest bearing. Since the amount due to GHL is due upon request, it is classified as a current liability. The original total amount due to GHL was $130,864, all of which has been forgiven and treated as capital contribution in APIC, resulting in zero balance as of March 31, 2026.

Due to HWH International Inc.

HWH International Inc. (“HWH”) is incorporated in the United States of America, and is a fellow subsidiary of Alset Inc. The amount due to HWH as of March 31, 2026 represents short-term working capital advances to the Company to finance its daily operations, including $855 borrowed from HWH, $640,915 from Health Wealth Happiness Pte. Ltd, a subsidiary of HWH and ($1,949)   from Hapi Wealth Builder Ltd., a subsidiary of HWH. There is no written, executed agreement and no financial/non-financial covenants and the amount due to HWH is non-interest bearing. Since the amount due to HWH is due upon request, it is classified as a current liability. The original total amount due to HWH was $639,821, all of which has been forgiven and treated as capital contribution in APIC, resulting in zero balance as of March 31, 2026.

Due from LiquidValue Development Limited.

LiquidValue Development Limited (“LVDL”) is incorporated in Hong Kong and is a fellow subsidiary of Alset Inc. The amount due from LVDL represents short-term working capital advances from the Company for LVDL daily operations. There is no written, executed agreement and no financial/non-financial covenants and the amount due from LVDL is non-interest bearing. Since the amount due from LVDL is due upon request, it is classified as a current liability. The original total amount due to LVDL was $12,764, all of which has been forgiven and treated as capital contribution in APIC, resulting in zero balance as of March 31, 2026.

Convertible Promissory Notes with VEII

CN #1

On January 27, 2023, the Company and HIPH World Inc. (f.k.a. American Premium Water Corporation and New Electric CV Corporation) (together with the Company, the “Lenders”) entered into a Convertible Credit Agreement (“CN #1”) with Value Exchange International, Inc., a Nevada corporation. CN #1 provides VEII with a maximum credit line of $1,500,000 (“Maximum Credit Line”) with simple interest accrued on any advances of the money under CN #1 at 8%. The principal amount of any advance of money under CN #1 (each being referred to as an “Advance”) is due in a lump sum, balloon payment on the third annual anniversary of the date of the Advance (“Advance Maturity Date”). Accrued and unpaid interest on any Advance is due and payable on a semi-annual basis with interest payments due on the last business day of June and last business day of December of each year. A Lender may demand that any portion or all of the unpaid principal amount of any Advance as well as accrued and unpaid interest thereon may be paid in shares of VEII’s common stock in lieu of cash payment. On February 23, 2023, Hapi Metaverse loaned VEII $1,400,000 (the “Loan Amount”). The Loan Amount can be converted into shares of VEII pursuant to the terms of the Convertible Credit Agreement for a period of three years. There is no fixed conversion price for the conversion option until Hapi Metaverse gives notice of conversion to convert the Loan Amount into shares of VEII common stock. The maturity date was extended to February 23, 2029 in March 2026.

On September 6, 2023, the Company converted $1,300,000 of the principal amount loaned to VEII into 7,344,632 shares of VEII’s common stock, level 1 of financial assets. Under the terms of CN #1, the Company received common stock warrants, level 2 of financial assets, to purchase a maximum of 36,723,160 shares of VEII common stock at an exercise price of $0.1770 per share. Such warrants expire five (5) years from date of their issuance.

As of March 31, 2026, $100,000 credit was advanced, and interest income of $1,973   and $1,973 are included in interest income for the three months ended March 31, 2026 and 2025, respectively. Alset Inc. acted as an intermediary to pay the money directly to VEII. A corresponding note payable to Alset Inc. was entered into in connection with this transaction. See the following paragraph for a description of the note payable to Alset Inc.

On February 23, 2023, the Company and Alset Inc. entered into a Subscription Agreement (the “AEI Subscription Agreement”). Pursuant to the AEI Subscription Agreement, the Company has borrowed $1,400,000 (the “AEI Loan Amount”) from AEI in exchange for a Convertible Promissory Note (the “AIL Note”). The term of the AEI Note is three years and will mature on February 23, 2031 with simple interest at a rate of 8% percent per annum. The AEI Note may be converted in whole or in part, into fully-paid and non-assessable shares of common stock, par value $0.0001 per share, of the Company (the “Shares”) at fixed conversion rate equal to $0.50 per share. AEI may require repayment upon 30 days’ notice. The Company shall be entitled to repay all or any portion of the AEI Loan Amount to AEI early and without penalty. As of March 31, 2026, $1,400,000 remains unpaid, and interest expenses of $27,616   and $27,616 are included in interest expenses for the three months ended March 31, 2026 and 2025, respectively. The AEI Loan Amount was used by the Company to fulfill the CN #1 between the Company and VEII.

CN #2

On December 14, 2023, the Company entered into a Convertible Credit Agreement (“CN #2”) with VEII. On December 15, 2023, the Company loaned VEII $1,000,000. CN #2 was amended pursuant to an agreement dated December 19, 2023. Under CN #2, as amended, this amount can be converted into shares of VEII pursuant to the terms of the Convertible Credit Agreement for a period of three years and will mature on December 14, 2026, with 8% interest per annum. In the event that the Company converts this loan into shares of VEII common stock, the conversion price shall be $0.045 per share. In the event that the Company elects to convert any portion of the loan into shares of VEII common stock in lieu of cash payment in satisfaction of that loan, then VEII will issue to the Company five (5) detachable warrants for each share of VEII common stock issued in a conversion (“Warrants”). Each Warrant will entitle the Company to purchase one (1) share of common stock at a per-share exercise price equal to the Conversion Price. The exercise period of each Warrant will be five (5) years from date of issuance of the Warrant. At the time of this filing, the Company has not converted the Loan Amount. As of March 31, 2026, $1,000,000 credit was advanced, and interest income of $19,726   and $19,726 is included in interest income for the three ended March 31, 2026 and 2025, respectively. The Company has subsequently confirmed with VEII the intent to extend the loan, with final terms to be formalized prior to the original maturity.

On December 15, 2023, the Company and AIL entered into a Subscription Agreement (the “AIL Subscription Agreement”). Pursuant to the AIL Subscription Agreement, the Company has borrowed $1,000,000 (the “AIL Loan Amount”) from AIL in exchange for a Promissory Note (the “AIL Note”). The term of the AIL Note is three years with simple interest rate of 5% per annum. AIL may require repayment upon 30 days’ notice. The Company shall be entitled to repay all or any portion of the AIL Loan Amount to Alset International Limited early and without penalty.

As of March 31, 2026, $1,000,000 remains unpaid, and interest expenses of $12,329   and $12,329 are included in interest expenses for the three months ended March 31, 2026 and 2025, respectively. The Company used the AIL Loan Amount to fulfill the CN#2.

CN #3

On July 15, 2024, the Company entered into a Convertible Credit Agreement (“CN #3”) with VEII for an unsecured credit line in the maximum amount of $110,000. Advances of the principal under CN #3 accrue simple interest at 8% per annum. Each Advance under CN #3 and all accrued interest thereon may, at the election of VEII, or the Company, be: (1) repaid in cash; (2) converted into shares of VEII common stock; or (3) be repaid in a combination of cash and shares of VEII common stock. The principal amount of each advance under CN #3 shall be due and payable on the third (3rd) annual anniversary of the date that the advance is received by VEII along with any unpaid interest accrued on the principal (the “Advance Maturity Date 3”). Prior to the Advance Maturity Date 3, 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 VEII common stock. Company may prepay any advance under CN #3 and interests accrued thereon prior to Advance Maturity Date 3 without penalty or charge. At the time of this filing, the Company has not converted the loan amount. As of March 31, 2026, $110,000 credit was advanced, and interest income of $2,170   and $2,170 is included in interest income for the three months ended March 31, 2026 and 2025, respectively.

Our Chairman, Chan Heng Fai, and another member of our Board of Directors, Lum Kan Fai, are both members of the Board of Directors of VEII. In addition to Mr. Chan, three other members of the Board of Directors of Alset Inc., our majority stockholder, are also members of the Board of Directors of VEII (Wong Shui Yeung, Wong Tat Keung and Lim Sheng Hon, Danny).

Convertible promissory note receivable - related party measured at fair value on a recurring basis are summarized below and disclosed on the consolidated balance sheets as of March 31, 2026 and December 31, 2025:

 SCHEDULE OF CONVERTIBLE PROMISSORY NOTE RECEIVABLE ASSETS MEASURED AT FAIR VALUE ON A RECURRING BASIS

The Company has elected to recognize the convertible loan at fair value and therefore there was no further evaluation of embedded features for bifurcation. The Company engaged third party valuation firm to perform the valuation of convertible loans. The fair value of the convertible loans is calculated using the binomial tree model based on probability of remaining as straight debt using discounted cash flow with the following assumptions:

 SCHEDULE OF FAIR VALUE OF CONVERTIBLE LOANS USING BINOMIAL TREE MODEL

Changes in the observable input values would likely cause material changes in the fair value of the Company’s Level 2 financial instruments. A significant increase (decrease) in this likelihood would result in a higher (lower) fair value measurement.

SCHEDULE OF CONVERTIBLE NOTES RECEIVABLE 

During the three months ended March 31, 2026 and 2025, the Company measured the fair value of convertible notes receivable with VEII and the balance increased from $489,418 to $522,874 and decreased from $569,630 to $518,082, respectively. The total $33,456 revaluated gain amount and $51,548 revaluated loss amount was booked in unrealized gain (loss) on securities investment – related party in the three months ended March 31, 2026 and 2025, respectively.

On August 22, 2025, the Company paid a bill on behalf of Value Exchange International (Hong Kong) Limited (“VEIHK”), a subsidiary of VEII, in the amount of $34,185 as an interest-free loan, which is due on demand.

On September 5, 2025, the Company entered into a loan agreement with VEIHK, in the amount of $84,819 at a rate of 8% per annum, the maturity date of which is on or before the three months of the effective date. The maturity date was subsequently extended to September 4, 2026.

As of March 31, 2026, VEIHK owed the Company a total of $92,376, of which recorded in amount due from related party in the financial statements. As of December 31, 2025, VEIHK owed the Company a total of $121,199, of which recorded in amount due from related party in the financial statements.

Due from Hapi Travel Holding Pte. Ltd.

On December 17, 2024, the Company entered into a shares purchase agreement with Hapi Travel Holding Pte. Limited (“HTHPL”), pursuant to which the Company sold 500,000 ordinary shares of Hapi Travel Limited (“HTL”), representing 100% of the issued and outstanding share capital of HTL, in accordance with the terms and conditions set out in the shares purchase agreement entered into with HTHPL, in exchange for a promissory note in amount of $82,635, which bears an 6% interest rate and has a scheduled maturity two years from the date of the promissory note. Interest income of $958 and $1,220 is included in interest income for the three months ended March 31, 2026 and 2025, respectively. There were $64,752 and $65,204 included in promissory note receivable for the three months ended March 31, 2026 and the year ended December 31, 2025, respectively. The Company recognized a $257,733 gain through additional paid in capital as a result of the sale to a related party.