Global Interactive Technologies, Inc S-1/A, filed Jun 8, 2023
Global Interactive Technologies, Inc. (GITS)
As filed with the Securities and Exchange Commission on June 8, 2023.
Registration No. 333-269419
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 10
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
| HANRYU HOLDINGS, INC. |
| (Exact name of Registrant as specified in its charter) |
| Delaware | 7370 | 88-1368281 | ||
| (State or other jurisdiction of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(I.R.S. Employer Identification Number) |
160, Yeouiseo-ro, Yeongdeungpo-gu, Seoul, Republic
of Korea 07231
+82-2-564-8588
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Chang-Hyuk Kang
Chief Executive Officer
Hanryu Holdings, Inc.
160, Yeouiseo-ro, Yeongdeungpo-gu, Seoul, Republic of Korea 07231
+82-2-564-8588
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
|
Matthew Ogurick, Esq. Pryor Cashman LLP 7 Times Square, 40th Fl New York, New York 10022 (212) 421-4100 |
Anthony W. Basch, Esq. Yan (Natalie) Wang, Esq. Alexander W. Powell, Esq. Kaufman & Canoles, P.C. Two James Center, 14th Floor 1021 East Cary St. Richmond, Virginia 23219 (804) 771-5700 |
Approximate date of commencement of proposed
sale to the public:
As soon as practicable after the effective date of this registration statement. The closing of the offering contained herein is contingent
upon the successful listing of our common stock on the Nasdaq Capital Market.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended, check the following box. ☒
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering. ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | Accelerated filer ☐ | Non-accelerated filer ☐ | Smaller reporting company ☒ | |||
| 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 7(a)(2)(B) of the Securities Act. ☐
The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment that specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
EXPLANATORY NOTE
This Amendment No. 10 to the Registration Statement (the “Registration Statement”) on Form S-1 (File No. 333-269419) is filed solely to amend Item 16 of Part II thereof and to file certain revised exhibits thereto. This Amendment No. 10 does not modify any provision of the preliminary prospectus contained in Part I of Amendment No. 9 to the Registration Statement. Accordingly, the preliminary prospectus has been omitted.
PART II — INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.
The following table indicates the expenses to be incurred in connection with this registration statement and the listing of our common stock. All amounts are estimated except the Securities and Exchange Commission (the “SEC”) registration fee, the Financial Industry Regulatory Authority, Inc. (“FINRA”) filing fee and the Nasdaq Capital Market listing fee.
| Amount | ||||
| SEC registration fee | $ | 5,387 | ||
| FINRA filing fee | $ | 5,956 | ||
| Nasdaq Capital Stock Market listing fee | $ | 70,000 | ||
| Accountants’ fees and expenses | $ | 55,000 | ||
| Audit fees and expenses | $ | 373,400 | ||
| Legal fees and expenses | $ | 555,000 | ||
| Transfer Agent’s fees and expenses | $ | 12,000 | ||
| Printing and engraving expenses | $ | 34,663 | ||
| Miscellaneous | $ | 188,594 | ||
| Total expenses | $ | 1,300,000 | ||
Item 14. Indemnification of Directors and Officers.
Section 145(a) of the Delaware General Corporation Law (“DGCL”) provides, in general, that a Delaware corporation may indemnify any person who was or is a party, or is threatened to be made a party, to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) because that person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise. The indemnity may include expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, so long as the person acted in good faith and in a manner he or she reasonably believed was in or not opposed to the corporation’s best interests, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.
Section 145(b) of the DGCL provides, in general, that a Delaware corporation may indemnify any person who was or is a party, or is threatened to be made a party, to any threatened, pending or completed action or suit by or in the right of the corporation to obtain a judgment in its favor because the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise. The indemnity may include expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action, so long as the person acted in good faith and in a manner the person reasonably believed was in or not opposed to the corporation’s best interests, except that no indemnification shall be permitted without judicial approval if a court has determined that the person is to be liable to the corporation with respect to such claim. Section 145(c) of the DGCL provides that, if a present or former director or officer has been successful in defense of any action referred to in Sections 145(a) and (b) of the DGCL, the corporation must indemnify such officer or director against the expenses (including attorneys’ fees) he or she actually and reasonably incurred in connection with such action.
Section 145(g) of the DGCL provides, in general, that a corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise against any liability asserted against and incurred by such person, in any such capacity, or arising out of his or her status as such, whether or not the corporation could indemnify the person against such liability under Section 145 of the DGCL.
Our Certificate of Incorporation (“Charter”), and our bylaws (“Bylaws”) provide for the indemnification of our directors and officers to the fullest extent permitted under the DGCL.
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We also expect to enter into separate indemnification agreements with our directors and officers in addition to the indemnification provided for in our Charter and Bylaws. These indemnification agreements will provide, among other things, that we will indemnify our directors and officers for certain expenses, including damages, judgments, fines, penalties, settlements and costs and attorneys’ fees and disbursements, incurred by a director or officer in any claim, action or proceeding arising in his or her capacity as a director or officer of the Company or in connection with service at our request for another corporation or entity. The indemnification agreements also provide for procedures that will apply in the event that a director or officer makes a claim for indemnification.
We also maintain a directors’ and officers’ insurance policy pursuant to which our directors and officers are insured against liability for actions taken in their capacities as directors and officers.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
Item 15. Recent Sales of Unregistered Securities.
Set forth below is information regarding all securities sold by Hanryu Holdings and HBC within the last three years which were not registered under the Securities Act. Also included is the consideration received by us for such securities and information relating to the section of the Securities Act, or rule of the SEC, under which exemption from registration was claimed. Prior to the Share Exchange (as defined below), HBC did not offer or sell any securities to any U.S. Person or within the United States, and therefore was not subject to Federal securities regulations nor did it need to rely on an exemption from registration under the Securities Act or rule of the SEC.
Share Exchange Agreement
On February 25, 2022, the Company entered into a share exchange agreement (the “Exchange Agreement”) with Hanryu Bank Co., Ltd., a corporation formed under the laws of South Korea (“HBC”), and the shareholders of HBC (the “HBC Shareholders”), pursuant to which the HBC Shareholders agreed to assign, transfer and deliver, free and clear of all liens, 100% of the issued and outstanding common shares of HBC, representing 100% of the equity interest in HBC (the “HBC Shares”) to the Company, in exchange for the Company issuing the HBC Shareholders 42,565,786 restricted shares of the Company’s common stock (the “Exchange Shares”).
As a result, HBC will become wholly owned subsidiary of the Company, and the HBC Shareholders will acquire a controlling interest in the Company (the “Share Exchange”). For accounting purposes, the Share Exchange will be treated as an acquisition of the Company and a recapitalization of HBC. HBC will be the accounting acquirer, and the results of its operations will carryover. Accordingly, the operations of Hanryu Holdings are not carried over and will be adjusted to $0.
On August 26, 2022, warrants were exercised with an exercise price of $1.27 to purchase 66,666 shares of common stock, and warrants were exercised with an exercise price of $0.42 to purchase 560,000 shares of common stock. The Company received $319,866 by cash.
On September 28, 2022, warrants were exercised with an exercise price of $0.42 to purchase 1,000,000 shares of common stock. The Company received $420,000 by cash.
On September 30, 2022, warrants were exercised with an exercise price of $1.27 to purchase 250,000 shares of common stock. The Company received $317,500 in cash.
In issuing the Exchange Shares to the HBC Shareholders, and the issuance of the shares of common stock pursuant to the exercise of the aforementioned warrants, the Company relied upon the exemptions from registration provided by both (i) Section 4(a)(2) of the Securities Act, as, among other things, the transaction did not involve a public offering and the securities were acquired for investment purposes only and not with a view to or for sale in connection with any distribution thereof, and (ii) Regulation S, promulgated under the Securities Act, as offers or sales made in an offshore transaction.
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HBC Issuances
In October 2018, HBC sold an aggregate of 1,000,000 shares of common stock at a price of $0.42 per share in private placement transactions, for an aggregate purchase price of approximately $422,000.
On December 19, 2018, HBC sold 500,000 shares of common stock at a price of $4.22 per share in a private placement transaction, for a purchase price of approximately $2,110,000.
On March 31, 2021, HBC issued 4,000,000 shares of common stock at a price of $0.42 per share in consideration of the exercise of certain warrants issued with bonds.
On March 31, 2021, HBC issued 4,150,000 shares of common stock at a price of $0.42 per share as consideration for the RnDeep Merger.
On September 29, 2021, HBC sold 600,000 shares of common stock at a price of $0.42 per share in a private placement transaction, for a purchase price of approximately $253,000.
On October 6, 2021, HBC issued 2,600,000 shares of common stock at a price of $0.42 per share in consideration of the exercise of certain warrants issued with bonds.
In October 2021, HBC sold an aggregate of 4,200,000 shares of common stock at a price of $0.42 per share in a private placement transaction, for an aggregate purchase price of approximately $1,772,300.
In November and December 2021, HBC issued and aggregate of 21,512,455 shares of common stock at a price of $0.42 per share in consideration of the exercise of certain warrants issued with bonds.
In November and December 2021, HBC issued and aggregate of 4,533,331 shares of common stock at a price of $1.27 per share in consideration of the exercise of certain warrants issued with bonds.
In February and March of 2023, the Company closed two private placements solely to accredited investors (as defined by Rule 501(a) of Regulation D of the Securities Act) pursuant to which the Company sold an aggregate amount of 240,000 shares of common stock for $10.00 per share, resulting in gross proceeds of $2,400,000. The purchase price of the common stock purchased in the private placements is subject to adjustment to the price of the common stock sold in the Company’s IPO, such that additional common stock shall be issued to the purchasers if the price of common stock sold in the IPO is less than $10.00 per share, or the purchasers shall return common stock to the Company if the price of the common stock sold in the IPO is greater than $10.00 per share, in each case resulting in the purchasers purchasing an aggregate amount of $2,400,000 of Company common stock at the IPO price.
On May 31, 2023, the Company completed a private placement to solely an accredited investor (as defined by Rule 501(a) of Regulation D of the Securities Act) pursuant to which the Company sold an aggregate amount of 760,000 shares of common stock for $10.00 per share, resulting in gross proceeds of $7,600,000.The offering was exempt from registration under Section 4(a)(2) of the Securities Act. The subscription agreement pursuant to which the common stock was sold to an accredited investor contains customary representations and warranties of the Company and the investors and customary indemnification rights and obligations of the parties.
Grants of Restricted Common Stock
The offers, sales and issuances of the securities described in Item 15 were deemed to be exempt from registration under the Securities Act under (i) Rule 701 promulgated under the Securities Act as offers and sale of securities pursuant to certain compensatory benefit plans and contracts relating to compensation in compliance with Rule 701, (ii) Section 4(a)(2) of the Securities Act as transactions by an issuer not involving any public offering, or (iii) Regulation S, promulgated under the Securities Act, as offers or sales of securities made in an offshore transaction. The recipients of securities in each of these transactions represented their intention to acquire the securities for investment only and not with a view to or for sale in connection with any distribution thereof and appropriate legends were affixed to the stock certificates and instruments issued in such transactions. All recipients had adequate access, through their relationships with us, to information about us.
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Item 16. Exhibits and Financial Statement Schedules.
(a) Exhibits. The list of exhibits is set forth below and is incorporated by reference herein.
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| * | Previously filed. |
| # | Filed herewith. |
| † | Identifies exhibits that consist of a management contract or compensatory plan or arrangement. |
(b) Financial Statement Schedules. Schedules not listed above have been omitted because the information required to be set forth therein is not applicable or is shown in the financial statements or notes thereto.
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
| (1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
| (i) | To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, as amended, or Securities Act. |
| (ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. |
| (iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. |
| (2) | That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
| (3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers, and controlling persons of the registrant pursuant to provisions described in Item 14 above, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer, or controlling person of the registrant in the successful defense of any action, suit, or proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes that:
| (1) | For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. |
| (2) | For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
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SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Seoul, Republic of Korea, on this 8th day of June, 2023.
| Hanryu Holdings, Inc. | ||
| By: | /s/ Chang Hyuk Kang | |
| Chief Executive Officer | ||
SIGNATURES AND POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities held on the dates indicated.
| Signature | Title | Date | ||
| /s/ Chang Hyuk Kang | Chief Executive Officer and Director | June 8, 2023 | ||
| (Principal Executive Officer) | ||||
| /s/ * | Chief Financial Officer | June 8, 2023 | ||
| (Principal Accounting Officer) | ||||
| /s/ * | Director | June 8, 2023 | ||
| /s/ * | Director | June 8, 2023 | ||
| /s/ * | Director | June 8, 2023 |
| *By: | /s/ Changhyuk Kang | |
| Name: | Changhyuk Kang | |
|
Title: |
Attorney-in-fact |
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Exhibit 2.5
Bond, Stock, and Management Right Transfer Contract
This bond, stock, and management right transfer contract (hereinafter referred to as “This Contract”) was concluded by the following parties as of June 30, 2021.
1. Transferer
Sewang Co., Ltd.
CEO: Jungshin Kong
D-43 on floor 6 at 602, Youngdongdae-ro, Gangnam-gu, Seoul, Korea (Samsung-dong)
2. Transferee
Hanryu Bank Co., Ltd.
B-dong, Room 1702 at 397 Seochodae-ro, Seocho-gu, Seoul, Korea (Seocho-dong)
3. Relevant company
Marine Island Co., Ltd. (hereinafter referred to as “Relevant Company”) with the main office registered and located at 160 (Yeouido-dong) Yeouiseo-ro, Yeongdeungpo-gu, Seoul, Korea
Article 1 Object for Transfer
1.1 Objects for the transfer in this contract are as follows.
A. Rent bond worth KRW 4,871,048,109 and its interest bond transferer has on Seoul Marina Co., Ltd.
B. Bond for claim amount for reimbursement worth KRW 4,610,404,814 and its interest bond transferer has on Seoul Marina Co., Ltd.
C. Bond transfer amount bond worth KRW 4,100,410,000 and its interest bond transferer has on the relevant company
D. Rent bond worth KRW 1,033,970,000 and its interest bond transferer has on the relevant company
E. All the stocks, management rights, and rights and obligations belonging to management rights issued by the relevant company
F. 9,777 ordinary shares issued by Seoul Marina Co., Ltd. and owned by transferer (24.53% of the total issued stocks)
G. Objects currently owned by transferee with sucesssful bid from the 3137 tangible movable assets auction in 2017 from Seoul Southern District Court
1.2 This contract is the “transfer contract on the object,” and transferee shall not raise objection on the defects on objects in this article.
Article 1.3 The lien nonexistence confirmation lawsuit in the number 2021Gahap102991 is in progress at Seoul Southern District Courtt in regards of the construction bonds possessed by the relevant company on Seoul Marina Co., Ltd. If the judgment is confirmed as the relevant company loses on the case, the effectiveness of this contract shall follow the Article 5.3 of this contract.
Article 2 Transfer Amount
2.1 Transfer Amount
Transfer amount in this case is KRW 3,500,000,000, and shall be paid in case or virtual assets.
2.2 Payment of Transfer Amount
A. Transferee shall pay for the KRW 1,200,000,000 to the transferer in cash until July 6, 2021.
B. Transferee shall pay for the virtual assets developed by the transferee in the amount relevant to KRW 2,300,000,000 as a balance to pay for the balance calculated after deducting the cash amount in the paragraph A. until July 2, 2021.
C. As for the previous paragraph, the value of virtual asset shall be converted based on the face price (or scheduled face price) issued in the beginning of listing for the payment. In case of shortage in the payment from outstanding balance when converting them in cash through listing in Korea or abroad, transferee shall additionally pay for the shortage in cash or virtual assets.
D. If it is not possible to convert the assets to cash including the case where virtual assets paid by the transferee to the transferer by failing to be listed in domestic or foreign exchange until December 30, 2021, transferee shall pay for the relevant amount in cash or marketable securities.
2.3 Take-Over of Liabilities from the Relevant Company
Assets and liabilities of the relevant company as of the date when concluding this contract are indicated in the current status of assets and liabilities in the appendix 1. As shown in the list from the appendix 1, transferee shall take the assets and liabilities confirmed as of the date of concluding this contract at their cost.
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Article 4 End of Transactions
4.1 When transferee pays for the entire transfer amount in the Article 2.2, transferer shall immediately notifies Haejin Chung of the termination of bond, stock, and management right transfer contract concluded on April 17, 2018, after July 17, 2021, and performs all the procedures needed to proceed with the transfer in the Article 1 including the notice of transferring the bonds or title transfer of stocks within 5 business days from when Haejin Chung receives the aforementioned notice.
4.2 Transferer shall hold the temporary meeting of shareholders to appoint directors designated by the transferee, and exercise voting rights for a party designated by the transferee to be appointed as the board member of the company to transfer management rights of the relevant company.
Article 5 Compensation of Damage and Penalty
5.1 If parties in this contract violate each provision in this contract, the counter-party may terminate this contract or seek for the restoration, and the violating party shall compensate KRW 350,000,000 as penalty in separation from the compensation of damage.
5.2 In spite of the Article 5.1, if the contract is not properly terminated or cancelled including the payment of balance in this contract by Haejin Chung in regards of the bond, stock, and management right transfer contract concluded on April 17, 2018, by the transferer and Haejin Chung, such circumstance shall not constitute the attributable causes of the transferer, and this contract shall be automatically terminated.
5.3 In spite of the Article 5.1, if the relevant company loses on the case with confirmed judgment in the lien non-existence confirmation lawsuit in the number 2020Gahap 102991 in Seoul Southern District Court issued by Optimus Asset Management to the relevant company, such circumstance shall not constitute attributable causes to the transferer, and the transferee may terminate this contract within a month from when the judgment is confirmed.
5.4 When this contract is terminated to restore the conditions, if the liability amount of the relevant company at the time of restoration exceeds the liability amount in the appendix 1, the transferer shall refund the balance deducted with the exceeding amount. Furthermore, they shall only refund the balance calculated by deducting KRW 25,000,000 borrowed by the transferee every month while running the relevant company.
5.5 There shall not be objection on the defects on the rights or objects of objects for the transfer in this case. At the same time, this contract shall not be terminated or cancelled due to the defects on the rights or objects.
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Article 6 Others
6.1 Limit of Transferring Rights in the Contract
Positions of each party in this contract shall not be transferred to a third party without the consent from the other party in advance.
6.2 Notice and Non-Disclosure
Parties and advisories (laws, accounting, and finance, etc.) shall not announce matters related to the conclusion or implementation of this contract as well as the business from this contract to a third party without consent from the other party. However, it is of an exception when required to announce them to obey the laws.
6.3 Proper Law
Laws in South Korea shall be applied on the rights or obligations of parties from this contract, and interpreted according to laws in South Korea. However, what is not regulated in this contract shall follow regulations and customs in commercial laws.
6.4 Resolution of Conflict
Resolution of all the disputes occurring from or with this contract shall be determined by the causes attributable to the transferer and the transferee, and also based on the lawsuit procedures with Seoul Central District Court as the competent court for the first trial.
In order to prove the conclusion of this contract, 2 copies of this contract shall be prepared and signed by the transferer and the transferee that keeps one copy of them, respectively.
Transferer Sewang Co., Ltd.
| CEO: Jungshin Kong |  |
D-43 on floor 6 at 602 Youngdongdae-ro, Gangnam-gu, Seoul, Korea (Samsung-dong)
Trasnferee
Hanryu Bank Co., Ltd.
Room 1702 at 397 Seochodae-ro, Seocho-gu, Seoul, Korea (Seocho-dong, Boutique Monaco)
| CEO: Munjong Kang |  |
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Seal Certificate
Corporate registration number: 110111-3409136
Company name: Sewang Co., Ltd.
Main office: D-43 on floor 6 at 602 Youngdongdae-ro, Gangnam-gu, Seoul, Korea (Samsung-dong)
CEO: Jungshin Kong
(560403-2228316)
Registry office: Registry office at Seoul Central
District Court/ Issuing registry: Registry
office at Seoul Central District Court
May 31, 2021
Court Administrative Department, Central Registered
Information Management Office,
Computer operating system manager
Receipt of the commission 1,000
1. It is available to confirm by checking the barcode at the bottom of this document with scanner or enter issuance confirmation number in the issuance confirmation menu of seal certificate from Internet Registry (http://ww.iros.go.kr) to confirm falsification or forgery.
2. When applying the text message service including the issuance of corporate seal certificate, it is available to have a notice of issuance via text message with cell phone (available to apply at registry office in the nation or Internet registry).
Exhibit 10.1
| Real Estate (Studio) Monthly Rent Agreement | ||||||||
| Lessor and lessee conclude the following lease agreement with the conditions below on the real estate as follows. | ||||||||
| Location | Boutique Monaco (Seochodae-ro, 397) Room 1702, at 1316-5 Seocho-dong, Seocho-gu, Seoul, Korea | |||||||
| Land | Type | Large | Area | 4284.8m2 |
Type of Site Right |
Ownership in Site Right | Expenses of Site Right | 23.75 of 4284.8 |
| Building | Structure | Steel concrete | Purpose | Work facility | Area | 158.04m2 | ||
| Parts to lease | The entire room 1702 | Area | 158.04m2 | |||||
|
2. Contract contents Only for the lease of the real estate listed in the Article 1 (Purpose), the lessor and the lessee shall pay for the lease security and amount as follows in the agreement. | ||||||||
| Security | KRW 50,000,000 | |||||||
|
Contract amount |
KRW 5 million shall be paid at the time of concluding the contract. Received by (Signature) | |||||||
| Balance | KRW 45,000,000 shall be paid on April 2, 2020 | |||||||
| Lease amount | KRW 5.7 million shall be (pre) paid on the 2nd of every month. VAT to be (separately applied) | |||||||
|
Article 2 (Duration)
The Lessor shall deliver the above property to the lessee until April 2, 2020, with the above property available for rental purposes, and the lease period shall be from the date of delivery to April 1, 2021 (12 months).
Article 3 (Change of Use and Squadron, etc.)
The lessee shall not change the use or structure of the above property without the consent of the lessee, transfer or provide collateral for the entire lease, and shall not use it for any purpose other than the lease.
Article 4 (Termination of Contract)
In the event that the arrears amount of the lessee to the third term or violate Article 3, the lessee may immediately terminate this agreement.
Article 5 (Termination of the Contract) If the lease agreement is terminated, the lessee shall restore the above property to its original state and return it to the lessee. In such cases, the lessor returns the deposit to the lessee, removes it when there is a late payment or damages, and returns the balance.
Article 6 (Termination of the Contract) Until the lessee pays the lessee a mid-payment (the balance in the absence of a mid-payment), the lessee shall repay the multiples of the down payment, and the lessee shall waive the down payment and terminate this agreement.
Article 7 (Defaulting and Restitution) If the lessor or lessee defaults on the contents of this agreement, the other party may terminate the contract at its best in writing to the defaulted person. In this case, the parties to the contract may claim damages in accordance with the termination of the contract, and the down payment shall be viewed as a basis for damages unless there is a separate agreement for damages.
Article 8 (Intermediary Maintenance) The practitioner shall not be liable for the failure of this agreement by the lessor and the lessee. In addition, intermediary remuneration shall be paid by both parties to the Agreement at the same time as the conclusion of this Agreement, and intermediary remuneration shall be paid even if this agreement is void, cancelled, or terminated without willful or negligent action by the practitioner. In the event of a joint brokerage, the lessor and the lessee shall pay the brokerage remuneration to the practitioner broker who has requested the brokerage.
Article 9 (Issuance of Intermediary Object confirmation Manual, etc.) The practitioner shall complete the intermediary object confirmation manual and attach a copy of the business guarantee relationship certificate (deduction certificate, etc.) to both parties of the trading party (Date of issuance: March 27, 2020)
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(Special Terms)
1. This is a lease agreement that the lessee enters into after confirming the purpose of the lease.
2. In the event of damage/loss of facilities and fixtures due to the willful/negligent negligence of the lessee, it shall be restored to its original condition.
3. In the event of an incident such as a malfunction of the facility, the lessee shall repair it if it is not the willful/careless of the lessee.
(However, coffee makers and microwaves cannot be used and repaired due to supplier bankruptcy) | ||||||||
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4. As of the date of the contract, there is no defect in the registered loan or right, and the lessor shall maintain this condition until the date of the balance.
5. Value-added tax (KRW 570,000) is borne by the lessee separately, and the lessor issues a tax invoice.
6. The management fee and electricity/gas/water fee shall be borne by the lessee in accordance with the boutique Monaco management regulations.
7. The lessee shall bear all damages incurred by the lessor in violation of the Contract of business registration as a business studio (non-transfer notification).
8. In the event of delinquency of the monthly rent, the delinquent interest of 18% of the year shall be calculated and paid one day from the date of delinquency.
9. If the rent is more than three years overdue, the lessor may immediately terminate the contract, enforce the name, and the name cost shall be borne by the lessee.
10. The rental difference and brokerage fee shall be borne by the lessee upon leaving before maturity.
11. Other matters shall be in accordance with the Civil Code, the Lease Protection Act, and the general custom of the real Estate lease agreement.
** The parties to this Agreement agree to provide personal information and use the information required for the contract.
** Renter's account number: Shinhan Bank 110-154-385180 Sunnam Ko (Prepay on 2nd day of each month)
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| In order to prove the conclusion of this contract, both parties confirm that all the information above is correct and sign/seal on them. March 27, 2020 | |||||||||||||
| Lessor | Address | C-dong, Room 3603 at Unju-ro 30-gil, Gangnam-gu, Seoul, Korea (Dogok-dong, Tower Palace Apartment) | |||||||||||
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Resident registration number |
450318- 2046914 |
Telephone number |
010- 6339- 6802 |
Name | Sunnam Ko | (Signature) | |||||||
| Lessee | Address | 32 Bongeunsa-ro 20-gil, Gangnam-gu, Seoul, Korea (Yeoksam-dong) |  | ||||||||||
| Corporate registration number |
10111- 6894467 |
Telephone number |
010- 8632- 0806 |
Name |
Hanryu Bank Co., Ltd. CEO: Sungmin Hong |
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| Private licensed real estate agent | Address of office | Room 114 on the floor 1 at Jinheung Building at 389 Seochodae-ro, Seocho-gu, Seoul, Korea | |||||||||||
| Name of office |
Seocho Sarang Licensed Real Estate Office | Name of CEO | Signature or seal | Ilhyung Sohn | |||||||||
| Telephone number |
02- 599- 0059 |
Registration number |
11650- 2018-00321 |
Licensed real estate agent |
Signature or seal |  | |||||||
| Joint licensed real estate agent | Address of office | President office at a part of the entire floor 1 at Yongma Building at 522 Nonhyeon-ro, Gangnam-gu, Seoul, Korea | |||||||||||
| Telephone number |
02- 557- 9836 |
Registration number |
11680-2018- 00246 |
Name of CEO | Signature or seal |
Sinju Park | |||||||
| Name of office |
The First Real Estate Agent | Licensed real estate agent |
Signature or seal |
 | |||||||||
Exhibit 10.7
Contract of acquisition of bond with warrant
This Agreement is entered into between the following parties on May 18, 2021.
SELLER: HANRYUBANK CO., LTD.
PURCHASER: LA PRIMERA CAPITAL INVESTMENTS, LLC
(Purpose]
(1) This contract is the 10th New Shareholder Bond (hereinafter referred to as “this bond”) 100 million won issued by the issuing company HanryuBank Co., Ltd. The purpose is to determine the rights and obligations arising between the issuer and the acquirer in the acquisition of 80 volumes by LA PRIMERA CAPITAL INVESTMENTS, LLC (hereinafter referred to as “Purchaser”).
(2) The purpose of issuing “this bond” is to raise the operating funds of HanryuBank Co., Ltd.
[Issuance condition]
| (1) | The conditions for issuance of “this bond” issued by “Seller” are as follows. |
| 1) | The company name of the issuer: Hanryubank Co., Ltd. | |
| 2) | The name of the bond: The 10th Separated Type Bonds with Acquisition Rights | |
| 3) | Type of bond: Detachable bond with warrant | |
| 4) | Bond interest: 1% | |
| 5) | Total amount of debentures: KRW 8,000,000,000 | |
| 5.1) | Payment schedule is as below: | |
| ● | Phase 1: KRW 2,161,252,500 (7th April 2021) | |
| ● | Phase 2: KRW 1,648,287,360 (24th May 2021) | |
| ● | Phase 3: Remaining balance (three months from 1st April 2021) | |
| 6) | Total issue price of bonds: 100% of the total amount of each bond | |
| 7) | The amount and type of issue of bond: 80 pieces of KRW 100,000,000 | |
| 8) | Issuance price of bond: Amount equivalent to 100% of the amount of each bond issued | |
| 9) | Issue date and maturity date of bond: Issue date April 1, 2021, Expiry date March 31, 2022 | |
| 10) | Prohibition of division and merger of individual bonds: These bonds do not exercise their rights from 3 months after the issue date. | |
| 11) | Payment agent and payment office: HanryuBank Co., Ltd. | |
| 12) | Issuance form: “This bond” is issued by a private equity firm without registration, and upon request of A, the real property is issued. | |
| 13) | Payment due date for “this bond”: three months from the date of report | |
| 14) | Payment place for “this bond”: HanryuBank Co., Ltd. | |
| 15) | Acquiring company name of “this bond”: LA PRIMERA CAPITAL INVESTMENTS, LLC |
(2) Since “this bond” is issued by a method other than solicitation, it is not listed on the Korea Stock and Futures Exchange, and cannot be resold to 50 or more persons within one year.
(3) Details concerning bond with warrant
“This debenture” may convert 100% of the denominated amount of debentures into common stocks of “Seller” at the request of the debenture creditor in accordance with the conditions of each of the following subparagraphs.
| 1) | Conditions for exercise of bond with warrant |
| (a) | Event rate: 100% of the number of shares divided by the exercise price divided by the amount of each debenture bond (in the case of claiming with two or more debenture bonds) is used as stocks that can be exercised, and the amount equivalent to shares of less than one share as cash when issued it is paid, and no interest is paid for the relevant period of the single order price. |
| (b) | Exercise price: The exercise price is KRW 500 (face value in case of par value division). |
The exercise price per share is retroactive from the day before the resolution of the board of directors to issue this bond. The closing price of ordinary shares established on the Korea Stock Exchange is the highest among the average closing price of one month, the average closing price of one week, the average closing price of the last day, and the three closing prices of the subscription date. However, after the contract conclusion date, if a reason for adjustment of the exercise price in accordance with item (e) below occurs, the exercise price adjusted in accordance with item (e) before the event request date is compared with the exercise price before adjustment, and the lower value is the exercise price.
| (c) | If HanryuBank Co., Ltd. merges with another corporation, the exercise price is adjusted according to the formula below, and in the case of the merger with another corporation, it is subject to mutual agreement. |
Exercise price after adjustment = Exercise price before adjustment X {number of previously issued stocks + (Number of merged new stocksX0.3) }/ (number of previously issued stocks+ Number of merged new stocks)
However, in the above formula, “number of previously issued stocks” is the number of shares as of the day immediately preceding the date of the occurrence of the strike price adjustment reason. After adjustment, the exercise price is revalue below the KRW 100 unit.
| (d) | If the exercise price needs to be adjusted due to a decrease in capital, stock split or merger, the “Seller” and “Purchaser” negotiate to adjust the exercise price. However, it shall be designated as a par value that is not affected by the decrease in the relevant stock. | |
| (e) | Apart from (b), (c) and (d), the exercise price is adjusted every one month from the issuance date of “this bond”. Based on the date before the event value adjustment date, After comparing the arithmetic average value of the last month’s average closing price, the average closing price of the week, and the daily closing price of the last day with the high value of the last day’s closing price and the previous event price, it will be exercised at a low price. However, the adjustment limit of the exercise price is the par value. | |
| (f) | The type of stock to be issued following the exercise of the preemptive right shall be the registered common stock of “Seller”. |
| 2) | ETC: In addition to the matters in each of the preceding subparagraphs, necessary matters are handled in consultation with “Seller” and “Purchaser”. |
[Acquisition timing and payment of the acquisition price]
The acquisition period of “debentures” to be taken over by “Purchaser” is “a week from the date of notification”, which is the payment due date, and “Purchaser” completes the payment of the purchase amount of “debentures” to the account designated by “Seller”.
[Notification obligation when issuing stocks and bonds]
If the “Seller” decides to issue corporate bonds or stocks before completing the redemption of “debentures”, the details are immediately referred to as “Purchaser” (hereinafter, “Purchaser” unless otherwise indicated after “debentures” have been transferred. Shall refer to the “debenture creditor” who has transferred “debentures”.) is notified.
[Use of financing]
The “Seller” shall preferentially use the funds raised by the issuance of this bond for the purpose of use stipulated in Article 1 (2).
[Reporting and notification obligations of the issuer]
(1) The “Seller” shall notify the “Purchaser” without delay in the event that a “reason for loss of profit over time” occurs or a reason for loss of profit over time occurs.
(2) The “Seller” shall immediately notify the “Purchaser” of the loss of time-limited gains on monetary payment obligations other than “debentures”.
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[Issuing Company’s Responsibilities]
When the “Seller” submits false or material information missing data or information in the performance of the matters related to this Agreement, or incurs damage to “B” or the head office creditor due to improper performance, the “Seller” shall compensate for this. Take responsibility.
[Guarantee of the issuer]
“Seller” guarantees “Purchaser” the following contents.
(1) The board of directors of “A” made a resolution to approve the issuance of “this bond” on April 1, 2021 in accordance with the proper procedures, and thereafter, in connection with the change of the issuance conditions, cancellation of issuance, or issuance of the “this bond”. We do not make any resolutions.
(2) Except for the information already disclosed by “Seller” to “Purchase”, no significant and unfavorable changes will occur in relation to the business condition and projections of “Seller’s” earnings, operating results, funds, finances, etc. after the 2021 fiscal year.
(3) The board of directors of “Seller” approved the conclusion and execution of this contract and the issuance of “the bonds”, and the articles of incorporation of “issuing company” and “issuing company” are one party that “Seller” concludes and executes this contract. It does not conflict with any provisions of all other contracts and agreements, and does not require approval or notification from the government or public agencies, or consent from a third party in addition to the provisions mentioned in this agreement.
(4) “Seller” compensates for damages (including litigation costs, attorney’s fees, etc.) incurred by “B” due to the facts or violations of the guarantees in this Article. However, exceptions are made for damages caused by intentional or gross negligence of the person who will receive compensation from the “Seller”.
[Loss of profit over time]
(1) In the event of any of the following reasons, “A” immediately loses the profit for the “this bond” by the deadline.
1) When the “Seller” applies for bankruptcy or commencement of rehabilitation procedures, or agrees to this, or when the “Seller” is declared bankrupt or initiates rehabilitation procedures
2) When the “Seller” has a reason for dissolution determined by the articles of incorporation, such as the expiration of the period of existence, a court order or a judgment for dissolution, or a resolution for dissolution at the general shareholders’ meeting.
3) When “Seller” is closed
4) When it is recognized that the “Seller” has reached a state of insolvency or suspension of payment, such as when the “Seller” has a transaction suspension disposition by the clearing house or when there is an application for registration of the default list of debts.
5) In the event of failure to repay a portion of the principal within the notified grace period due to failure to fulfill the obligation to repay part of the principal or the obligation to pay interest for which the deadline has reached.
6) In the case of loss of time-limited profit or collateral for the debt due to the default of the debt due to the payment at maturity, for the debt of the “Seller” whose principal amount is more than 5 times the equity capital.
7) When a seizure order is decided on all or important parts of the property of the “Seller” or when a voluntary auction is initiated
8) If the “Seller’s” property is not canceled within 60 days after the seizure or provisional disposition has been declared
9) Other cases where the “Seller” judges that the breach of obligations under “this agreement” is serious (2) In the event of loss of time-limited profit pursuant to Paragraph 1, the “Seller” shall immediately repay the full principal amount and any unpaid amount of interest accrued up to the date the time-limited profit is lost.
[Special Agreement]
(1) The “Seller” shall notify the “Purchaser” without delay in the event of the following occurrences before completing the redemption of the “Bond”.
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1) When the bills and checks issued by the “Seller” are defaulted or the banking transaction is suspended
2) Change or suspension of part or all of business
3) Change of business purpose
4) When enormous damage occurs to the “Seller” such as a fire
5) When you want to split the “Seller”
6) When there is a resolution of the board of directors to issue stocks or stocks of the “issuing company” or to issue any securities that can exercise the right to request issuance
7) When an asset revaluation commencement report and a revaluation report are filed in accordance with the Asset Revaluation Act
8) When there is an internal resolution, such as a resolution of the board of directors, that borrows more than 50% of the total equity of the “Seller”
[Notification and Request]
All notices or requests for this Agreement shall be made in writing. Any such notification or request shall be deemed to have been duly made upon receipt by the party by personal delivery, mail or fax to the address of the party notified in advance or to an address otherwise designated by either party. All notices, requests and other communications are deemed to have been reached on the same day if received by the recipient during normal business hours at the place of collection. In other cases, any notice, request or other contact shall be deemed to have reached the next business day of the place of receipt.
[Competent court]
Litigation regarding this Agreement shall be under the jurisdiction of the court having jurisdiction over the location of the head office of the “Seller”.
[Principle of interpretation of contract]
In the event of an objection between the parties regarding matters not stipulated in this contract or the interpretation of this contract, it shall be governed by the Capital Market and Financial Investment Business Act, related regulations, and commercial practices.
As proof of the conclusion of the above contract, two copies of this contract will be prepared, stamped in the name of “Seller” and “Purchaser”, and one copy of each “Seller” and “Purchaser” will be kept..
May 18, 2021
| Signed | |||
| /s/ Munjoong Kang | /s/ Eugene Kim | ||
| Authorized Signature | Authorized Signature | ||
| Munjoong Kang / CEO | Eugene Kim / President | ||
| Print Name and Title | Print Name and Title |
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Exhibit 10.9
| Hanryu Bank Co., Ltd.
The 11th Bearer Separate Privately Placed Bond with Warrant Underwriting Agreement |
Issuing Company: Hanryu Bank Co., Ltd.
Underwriter: Midas AI Co., Ltd.
Underwriting Agreement concluded on July 2, 2021
Date of Payment and Issuance: July 2, 2021
This bond with warrant underwriting agreement was concluded between the following parties on July 2, 2021.
| Issuer | Hanryu Bank Co., Ltd. | |
| CEO: Munjung Kang | ||
| [B-Dong, Room 1702, 397 Seochodae-ro, Seocho-gu, Seoul, Korea (Seocho-dong)] | ||
| Underwriter | Midas AI Co., Ltd. | |
| CEO: Sangchul Seo | ||
| [4th and 5th floors at Daechisangbu Tower at 413 Yeoksam-ro, Gangnam-gu, Seoul, Korea] |
Full Text
Hanryu Bank Co., Ltd. (hereinafter referred to as “Issuing Company”) has concluded the underwriting agreement (hereinafter referred to as “This Agreement”) with Midas AI Co., Ltd. (hereinafter referred to as “Underwriter” or “Debenture Holder”) for the 11th bearer separate privately placed bond (hereinafter referred to as “This Bond”) with the total face value of KRW 4,500,000,000 issued on July 2, 2021, from the resolution of the board of directors held on July 2, 2021.
Article 1 Purpose of Agreement
The purpose of this agreement is to clarify rights and obligations between the issuing company and the underwriter when the underwriter underwrites “this bond” issued by the issuing company.
Article 2 Underwriting Bond
Issuing company shall issue this bond according to conditions and contents determined in this agreement, and underwriter shall underwrite them.
| Underwriter | Underwriting Amount | |
| Midas AI Co., Ltd. | KRW 4,500,000,000 |
Article 3 Issuing Conditions of Bonds
Issuing conditions of this bond are as follows.
| 1. | Company name: Hanryu Bank Co., Ltd.
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| 2. | Name of bond: The 11st bearer separate privately placed bond with warrant of Hanryu Bank Co., Ltd.
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| 3. | Type of bond: Bearer separate privately placed bond with warrant
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| 4. | Total issuing price of the bond: KRW 4,500,000,000
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| 5. | Issuing price of the bond: 10% of the total face value of the bond
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| 6. | Face value and the number of bond: 9 of KRW 500 million bonds
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| 7. | Bond division and merger prohibition: This bond shall not be divided or merged for a month from the date issuance.
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| 8. | Interest rate of the bond: Coupon rate shall be calculated as the annual interest rate of 0.0% on the total face value of each bond from the next day of the issuance to the date of redemption and paid in every 12 month. Maturity secured profit rate shall be 3.0% of the annual rate.
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| 9. | Redemption method and expiration of the bond: The principal of this bond possessed until the maturity shall be paid at a time as relevant to the annual interest rate of 3.0% of the secured yield to maturity of the face value on July 2, 2024. However, if the redemption date is not the business day, the amount shall be paid on the following business day, and the interest shall not be calculated after the principal redemption date.
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| 10. | Put option about this bond: “Debenture holder” of “this bond” may claim the early redemption before the maturity for all or a part of the principal of “this bond” on July 2, 2022, a year after the issuance of “this bond” or on the date relevant to every 3 month afterwards (hereinafter referred to as “Date of Early Redemption”). However, if the date of early redemption is not the business day, the amount shall be redeemed on the next business day, and the interest shall not be calculated after the date of early redemption. In this case, the annual interest rate of 3.0% shall be applied for the early redemption.
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| 11. | Call option about this bond: The issuing company or a party designated by the issuing party may claim the purchaser to sell all or a part of this bond possessed by the debenture holder from the date of issuance of this bond to the maturity. Debenture holder shall sell this bond according to the claim in this case. In this case, the annual interest rate of 3.0% shall be applied on call option.
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| 12. | Overdue interest: When the issuing company fails to pay for the principal or interest on each due date according to the paragraph 9, the overdue interest shall be paid on the principal. In this case, overdue interest rate shall be the annual interest rate of 12%. Overdue interest shall be paid on a daily basis with 365 days in a year.
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| 13. | Redemption of principal and interest payment place: Hanryu Bank Co., Ltd.
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| 14. | Payment of the bond: Hanryu Bank Co., Ltd.
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| 15. | Usage of the bond: Operating fund including the business expenses
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| 16. | Date of concluding the bond underwriting agreement: July 2, 2021
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| 17. | Subscription date of the bond: July 2, 2021
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| 18. | Payment date of the bond: July 2, 2021
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| 19. | Issuance date of the bond: July 2, 2021
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| 20. | Maturity of the bond: July 2, 2024
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| 21. | Issuing method of the bond: Bond separated with preemptive right and warrant shall be issued in kind. |
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| 22. | Benefit of time of the issuing company |
| A. | Causes of the lost benefit of time from the issuing company: In case of causes relevant to the following on the issuing company, the issuing company shall be lost with benefit of time on this bond without separate request or notice and shall immediately pay for the amount that is calculated by adding all the interest amounts applied with the coupon rate from the paragraph 8 of this article from the date of the payment of full amount of outstanding principal (face value) and the previous interest amount to when the benefit of time is lost to the debenture holder. |
| a) | If the issuing company becomes bankrupt or applies for the initiation of rehabilitation or agrees with them, or if the bankruptcy is announced, or the rehabilitation procedures are initiated on the issuing company |
| b) | In case of causes of the dissolution as determined by the articles of association including the expiration of duration on the issuing company, or order of dissolution or judgment of dissolution from the court, or resolution of dissolution from the general meeting of shareholders |
| c) | If the issuing company is temporarily or permanently closed with business, or faces significant business suspension or cancellation from the supervising organizations (however, temporary business suspension from the administrative order from the supervising organization shall be excluded). |
| d) | If there is suspension in transaction from promissory note exchange to the issuing company, or if there is the application of registration on the default list, and other cases when the issuing company is acknowledged to be in insolvent or suspended with payment |
| B. | Causes of the lost benefit of time on the issuing company: In case of causes occurring on the issuing company, the debenture holder may immediately lose the benefit of time on all or a part of the outstanding principal and claim for the payment of amount added with all the interest amounts calculated by applying the coupon rate. |
| a) | When the issuing company violates obligations from this agreement |
| b) | When non-fulfilling obligations to pay for all or a part of the principal of this bond and also the interest on due, or failing to pay for the amount within 5 days of due date |
| c) | If the payment is not made on principal among debts from the issuing company other than this bond, or if there are causes of lost benefit of time due to financial default, or if the security right on debt has been performed |
| d) | All or more than 50% of the assets of the issuing company are reported to be applied with injunction or provisional attachment, and if they are not cancelled within 90 days |
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| C. | If the benefit of time on this bond is lost on the issuing company according to A or B in this paragraph, failing to pay for the principal within due date, the overdue interest shall be paid as applied with the interest rate from the next date of the payment to the date of actual payment made in the paragraph 12 of this article. |
| D. | Issuing company shall immediately notify the underwriter or debenture holder of the occurrence of causes for the lost benefit of time in writing (or overall conditions related to the lost benefit of time along with the delivery of notice/time lapse/confirmation letter issuing courses, or actual cases or behaviors related to them). |
| 23. | Distributing date and place of the bond: Bond shall be issued on the relevant date and distributed to the underwriter. |
| 24. | This bond shall be issued in a method other than the recruitment, and not listed in the stock market. |
| 25. | Matters related to the preemptive right: Preemptive right of this bond shall be separated from the unsecured bond, and issued in kind to the underwriter on the date of bond issuance according to the following conditions. |
| A. | Amount and the face value of the preemptive right: 9 KRW 500 million bonds |
| B. | Types of stocks to be issued in the exercise of securities from the preemptive right to new stocks: Registered ordinary shares from the issuing company |
| C. | Exercise ratio: 100% of the shares after dividing the face value of securities from the preemptive right to new stocks (the total of face value if exercising preemptive right with more than two bonds with warrant) with the following exercise price of the preemptive right is regarded as the number of exercise shares, and the fractional share shall not be acknowledged. |
| D. | Exercise price of preemptive right: KRW 1,500 per share |
| E. | Adjustment of exercise price of preemptive right (hereinafter referred to as “Exercise Price”) |
| a) | If the issuing company issues stocks through capital increase by issuing new stocks, share distribution, or capital transfer of reserve in the issuance price that is lower than the market price (including when it is lower than the exercise price prior to the issuance, and same as the following paragraphs) before a part in possession of securities from the preemptive right to new stocks claims to exercise preemptive right, or issues convertible bonds or bonds with warrant with convertible price or exercise price below the market price, the exercise price of preemptive right is adjusted as follows. However, when performing the capital increase both by issuing new stocks or without consideration, when the per-share exercise price of capital increase by issuing new stocks is above the exercise price before the adjustment, the shares of newly issued stocks by the capital increase by issuing new stocks shall not be applied in the adjustment of exercise price but only applied with the newly issued shares from the capital increase without consideration. The date of adjustment of exercise price according to this paragraph shall be the date of issuance of new stocks or convertible bonds or bonds with warrant from the capital increase by issuing new stocks, share distribution, or capital transfer of reserve. |
Exercise price after the adjustment = Exercise price before the adjustment x [{A+(B+C/D)} / (A+B)]
| A. | Issued shares of stocks |
| B. | Newly issued shares of stocks |
| C. | Per-share exercise price |
| D. | Market price |
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However, in the above formula, the “issued shares of stocks” shall be the total shares issued as of the date immediately before the cause of the adjustment occurs. In the case of issuing convertible bonds or bonds with warrant, the “issued shares of stocks” shall be the number of shares to be issued if all shares are converted at the conversion price. In addition, the “per-share issuing price” in the above formula is zero (0) in the case of share division, capital increase without consideration, and stock dividend. In the case of issuance of convertible bonds or bonds with warrant, the conversion price or exercise price at the time of issuance of such bonds. In the above formula, “market price” is the reference stock. However, in case of an adjustment due to an issuance that falls below the value of the exercise on the day before the issuance, the exercise value on the day before the issuance shall be).
| b) | In case that an adjustment of the exercise price is required by merger, capital decrease, share division and, etc., securities from the preemptive right to new stocks shall be exercised and acquired in full stock immediately before the merger or capital decrease so that the securities from the preemptive right to new stocks may have the same effect. In the case of mergers, capital decrease, share division, and mergers, the exercise price shall be adjusted taking into account the ratio of each of them. In case that the securities from the preemptive right to new stocks holder have suffered damages due to the issuer’s failure to take these measures, the issuer shall compensate the damages. In addition, the issuing company shall not conduct mergers, splits, and sales transfers in a manner that adversely affects the rights of the holder of the new share acquisition rights. |
| c) | In case of an increase in the value of the stock, such as the merger of potatoes and shares, the value of the exercise shall be adjusted on the condition that the adjustment ratio due to the merger of potatoes and shares is reflected upward. |
| d) | If the exercise price adjusted by a) to c) above is less than the face value of the shares, the face value shall be the exercise price, and the total amount of the issue value of the shares to be issued due to the exercise of the preemptive right granted to each bond with warrant shall not exceed the issue value of each new share rights bond. |
| (e) | Less than one KRW of the exercise price shall be raised after adjustment under this subparagraph. |
| F. | Preemptive right exercise period: One year after the date of issuance of this bond (July 2, 2022) to one month before the principal redemption date (June 2, 2024). If the end of the exercise period is not a business day, it shall be a business day. If not exercising preemptive right within this period, the preemptive right of these securities from the preemptive right to new stocks will be extinguished. |
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| G. | Preemptive right exercise place: Main branch of the publishing company |
| H. | Preemptive right exercise procedures and methods: |
| a) | Securities from the preemptive right to new stocks and a predetermined preemptive right exercise claim shall be submitted to the issuer with the necessary information. |
| b) | The payment of the principal of the new shares issued as a preemptive right exercise shall be paid to the issuer or to the financial institution designated by the issuer or to substitute the new shares into separate bonds of this bond. |
| c) | In the case of substitute payment, the amount equivalent to a single share of less than one week of the recommendation of the bond shall be paid in cash by the issuing company at the time of the sovereign grant. |
| I. | When the preemptive right exercise takes effect: In accordance with the preemptive right exercise procedure above, the preemptive right exercise shall take effect when the preemptive right exercise claim and the securities from the preemptive right to new stocks are submitted and the new stock acquisition fee is paid. Shares issued by the preemptive right exercise shall be deemed to have been issued at the time of the effect of the above preemptive right exercise. |
| J. | How and where the shares issued by the preemptive right exercise are issued: The shares issued by the preemptive right exercise shall be issued by the issuing company or the issuing company’s name and opening agency. |
| K. | Initial dividend and interest of shares issued due to preemptive right exercise: Shares issued by preemptive right exercise shall have the effect of the dividend as issued as shares at the end of the business year immediately prior to the business year to which the preemptive right exercise claim date belongs, and the interest of bonds with warranty shall not be affected by the preemptive right exercise. |
| L. | Holding of non-issued shares: The issuer shall hold as unreleased shares the number of shares to be issued due to the preemptive right exercise among the total number of shares to be issued by the issuer until the end of the preemptive right exercise period. |
| M. | Registration of capital increase by preemptive right exercise: The “issuer” shall perform the registration procedure in accordance with the preemptive right exercise within 5 business days from the date of the preemptive right exercise. |
| 27. | Special Terms |
| A. | Only the preemptive right (warranty) of this bond may be transferred separately, and the issuer may charge the acquirer to preferentially sell a portion or 100% of the preemptive right to the issuer and the issuer specified within one month before maturity from the date of issue. At this time, a premium of 3% of the preemptive right’s exhortation will be paid. |
| B. | In case that the largest shareholder of the issuer sells his or her share, he or she shall preferentially repay these bonds prior to the sale, or sell them. |
| 28. | For matters not set forth in this Agreement, the provisions of Articles 516-2 to 516-11 of the Commercial Code shall be followed |
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Article 4 Expenses
Expenses from the issuance of this bond shall be borne by the issuing company in principles. However, the expenses acknowledged by the underwriter of this bond such as the expenses for setting pledges shall be of an exception.
Article 5 Resale of Bonds
| 1. | Underwriter may resell the bond to a third party before the due date of redemption of the bond from a month after issuing the bond. However, underwriter shall not resell the bond to more than 50 people within a year of the issuance. |
| 2. | Rights of the underwriter on the contract in case of resale shall be automatically succeeded to a party acquiring this bond. |
Article 6 Statement and Guarantee of Issuing Company
| 1. | As of the date of this agreement, the issuer shall state and guarantee to the underwriter: |
| A. | The issuing company is legally established and survives in accordance with the laws of the Republic of Korea and has the ability and qualifications to perform the operations it currently performs. The issuing company is not in liquidation or in a state where bankruptcy, corporate regeneration procedures, insolvency signs under the Corporate Structure Adjustment Promotion Act, corporate management procedures and other similar procedures are in progress or are about to be initiated. |
| B. | The issuing company has performed all of the authorized procedures required by the Board of Directors and/or the General Meeting of Shareholders or articles of association of the issuing company or law in connection with the conclusion of this agreement and the implementation of the contents of this agreement (including the issuance of these bonds to the underwriter). |
| C. | This agreement has the effect of legally binding the issuer, and if the issuer does not fulfill its contractual obligations, the underwriter may take all legal means to force the issuer to fulfill its obligations. |
| D. | No laws, court rulings, decisions, and orders exist that substantially limit the issuer’s exercise of rights and obligations under this agreement, and the conclusion and implementation of this agreement by the Issuer shall not violate or conflict with the Articles of Incorporation of the issuer or any other agreement of which the issuer is a party. |
| E. | The issuing company’s duty to pay taxes is fulfilled. |
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| F. | There shall not be any litigation or legal dispute of a nature that has a significant adverse effect on the financial condition of the issuing company or on the trading relationship under this Agreement as a lawsuit or legal dispute that is currently in progress or expected in the future. |
| G. | The Issuing company has not (1) issued any other shares or bonds or certificates or securities granting the right to acquire them, other than those disclosed to the underwriter prior to the conclusion of this agreement, and (2) entered into no agreement granting the right to acquire shares or bonds, such as stock options, with respect to common shares already issued, bonds and stock options that have not |
| H. | All real estate, property, machinery, vehicles, and office equipment held by the issuing company are legally owned by the issuing company or are authorized to be used by the issuing company. |
| I. | The Issuer shall not be a party to any agreement, agreement, or other agreement that places an unusual burden on the Issuer’s operations and shall not be bound by such agreement, agreement, or other agreement. |
| J. | The financial statements of the issuing company’s recent business year were prepared in accordance with generally accepted accounting principles in Korea, accurately and fairly represent the issuer’s financial status and operating status, and do not miss significant liabilities (including contingent liabilities). In addition, after the date of the above financial statements, there were no important matters that may adversely affect the financial condition and operating status of the issuing company. |
| K. | The issuing company legally holds intellectual property rights such as patents, trademarks, and copyrights, as well as licenses from all necessary government and supervisory authorities regarding the sales and assets they currently hold. |
| L. | The issuing company is not in a situation where it may default on its debts and lose the profits of its due date or initiate forced execution. |
| M. | The issuing company did not cause dissolution under Article 517 of the Commercial Code and other laws. |
| N. | Notes or checks issued by the issuing company have not been dishonored or transactions with the bank have not been suspended or prohibited. |
| O. | The issuing company has no current progress (except if the application for suspension or cancellation of the execution has been accepted) in the event that forced enforcement of the issuing company’s property (including enforcement by a ruling or order) has been carried out or disclosed. |
The issuer shall immediately notify the underwriter if any statement or guarantee made by the issuer under this agreement is false or inaccurate or likely to be made in light of the circumstances at that time at any time before the underwriting payment of the bonds is paid on the date of issue.
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Article 7 Prerequisites of Payment
The underwriter shall acquire this bond and pay the resulting acquisition fee only if the conditions of each of the following paragraphs are met.
| 1. | From the date of this agreement, there will be no event that the (financial or other) circumstances or general affairs of the issuer or its subsidiaries will be changed to a significantly unfavorable state due to the issuance of these bonds or reasonably expected to involve adverse changes |
| 2. | The statements and guarantees provided by the issuing company in this agreement shall be true and accurate as of the date of this agreement and on each date on which the statements and guarantees are deemed to have been made, and the above statements and guarantees shall be true and accurate as to the facts and circumstances existing at the time of payment |
| 3. | There will be no changes that may have a significant adverse effect on the management or financial position of the issuing company as of the date of delivery |
| 4. | As of the date of payment, there will be no default of the issuer’s contractual obligations and the underwriter’s approval conditions |
| 5. | As of the date of payment, the articles of association of the issuing company and the minutes of the board of directors, and other documents required by the underwriter as reasonably necessary shall be filled out and submitted in the content and format that the underwriter satisfies |
Article 8 Proper Law and Competent Court
This agreement and the bond shall be interpreted according to the laws in South Korea as proper law, and lawsuits on this agreement and bond shall be handled in Seoul Central District Court as the competent court for the first trial.
Article 9 Resolution of Objections
Objection from matters not determined in this contract shall be processed in business custom or in negotiation with the issuing company and the underwriter.
Article 10 Notice
Notice from this contract shall be made in writing, and delivered in the following address or number in person, fax, or registered mail.
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Notice to the underwriter:
Midas AI Co., Ltd.
Address: 4th and 5th floors at Daechisangbu Tower at 413 Yeoksam-ro, Gangnam-gu, Seoul, Korea
Charging person: Jongpan Choi
Telephone: 02-3497-8900
Email: jpchoi@midas-ai.co.kr
Notice to the issuing company:
Hanryu Bank Co., Ltd.
Reference: Juhyun Shin
Address: B-dong, Room 1702 at 397 Seochodae-ro, Seocho-gu, Seoul, Korea (Seocho-dong)
Telephone: 02-564-8588
Email: sjh@hanryubank.com
As a proof of the conclusion of this contract, 2 copies of this contract shall be prepared and signed/sealed by each party to keep one copy, respectively.
July 2, 2021
| “Issuing company”: | Hanryu Bank Co., Ltd. |
| CEO Munjung Kang (Signature) | |
| “Underwriter” : | Midas AI Co., Ltd. |
| CEO Sangchul Seo (Signature) |
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Exhibit 10.10
Hanryu Bank Co., Ltd. The
12th Bearer Separate Privately |
Issuing Company: Hanryu Bank Co., Ltd.
Underwriter: Changhyuk Kang, Donghoon Park
Underwriting Agreement concluded on July 1, 2021
Date of Payment and Issuance: July 1, 2021
This bond with warrant underwriting agreement was concluded between the following parties on July 2, 2021.
| Issuer | Hanryu Bank Co., Ltd. | |
| CEO: Munjung Kang | ||
| [B-Dong, Room 1702, 397 Seochodae-ro, Seocho-gu, Seoul, Korea (Seocho-dong)] | ||
| Underwriter | Changhyuk Kang(810106-1845910) | |
| Donghoon Park(850120-1148114) |
Korea]
Full Text
Hanryu Bank Co., Ltd. (hereinafter referred to as “Issuing Company”) has concluded the underwriting agreement (hereinafter referred to as “This Agreement”) with Changhyuk Kang and Donghoon Park (hereinafter referred to as “Underwriter” or “Debenture Holder”) for the 12th bearer separate privately placed bond (hereinafter referred to as “This Bond”) with the total face value of KRW 1,300,000,000 issued on July 1, 2021, from the resolution of the board of directors held on July 1, 2021.
Article 1 Purpose of Agreement
The purpose of this agreement is to clarify rights and obligations between the issuing company and the underwriter when the underwriter underwrites “this bond” issued by the issuing company.
Article 2 Underwriting Bond
Issuing company shall issue this bond according to conditions and contents determined in this agreement, and underwriter shall underwrite them.
| Underwriter | Underwriting Amount | |
| Changhyuk Kang | KRW 700,000,000 | |
| Donghoon Park | KRW 600,000,000 |
Article 3 Issuing Conditions of Bonds
Issuing conditions of this bond are as follows.
| 1. | Company name: Hanryu Bank Co., Ltd. |
| 2. | Name of bond: The 11st bearer separate privately placed bond with warrant of Hanryu Bank Co., Ltd. |
| 3. | Type of bond: Bearer separate privately placed bond with warrant |
| 4. | Total issuing price of the bond: KRW 1,300,000,000 |
| 5. | Issuing price of the bond: 10% of the total face value of the bond |
| 6. | Face value and the number of bond: 13 of KRW 100 million bonds |
| 7. | Bond division and merger prohibition: This bond shall not be divided or merged for a month from the date issuance. |
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| 8. | Interest rate of the bond: Coupon rate shall be calculated as the annual interest rate of 0.0% on the total face value of each bond from the next day of the issuance to the date of redemption and paid in every 12 month. Maturity secured profit rate shall be 3.0% of the annual rate. |
| 9. | Redemption method and expiration of the bond: The principal of this bond possessed until the maturity shall be paid at a time as relevant to the annual interest rate of 3.0% of the secured yield to maturity of the face value on July 1, 2024. However, if the redemption date is not the business day, the amount shall be paid on the following business day, and the interest shall not be calculated after the principal redemption date. |
| 10. | Put option about this bond: “Debenture holder” of “this bond” may claim the early redemption before the maturity for all or a part of the principal of “this bond” on July 1, 2022, a year after the issuance of “this bond” or on the date relevant to every 3 month afterwards (hereinafter referred to as “Date of Early Redemption”). However, if the date of early redemption is not the business day, the amount shall be redeemed on the next business day, and the interest shall not be calculated after the date of early redemption. In this case, the annual interest rate of 3.0% shall be applied for the early redemption. |
| 11. | Call option about this bond: The issuing company or a party designated by the issuing party may claim the purchaser to sell all or a part of this bond possessed by the debenture holder from the date of issuance of this bond to the maturity. Debenture holder shall sell this bond according to the claim in this case. In this case, the annual interest rate of 3.0% shall be applied on call option. |
| 12. | Overdue interest: When the issuing company fails to pay for the principal or interest on each due date according to the paragraph 9, the overdue interest shall be paid on the principal. In this case, overdue interest rate shall be the annual interest rate of 12%. Overdue interest shall be paid on a daily basis with 365 days in a year. |
| 13. | Redemption of principal and interest payment place: Hanryu Bank Co., Ltd. |
| 14. | Payment of the bond: Hanryu Bank Co., Ltd. |
| 15. | Usage of the bond: Operating fund including the business expenses |
| 16. | Date of concluding the bond underwriting agreement: July 1, 2021 |
| 17. | Subscription date of the bond: July 1, 2021 |
| 18. | Payment date of the bond: July 1, 2021 |
| 19. | Issuance date of the bond: July 1, 2021 |
| 20. | Maturity of the bond: July 1, 2024 |
| 21. | Issuing method of the bond: Bond separated with preemptive right and warrant shall be issued in kind. |
| 22. | Benefit of time of the issuing company |
| A. | Causes of the lost benefit of time from the issuing company: In case of causes relevant to the following on the issuing company, the issuing company shall be lost with benefit of time on this bond without separate request or notice and shall immediately pay for the amount that is calculated by adding all the interest amounts applied with the coupon rate from the paragraph 8 of this article from the date of the payment of full amount of outstanding principal (face value) and the previous interest amount to when the benefit of time is lost to the debenture holder. |
| a) | If the issuing company becomes bankrupt or applies for the initiation of rehabilitation or agrees with them, or if the bankruptcy is announced, or the rehabilitation procedures are initiated on the issuing company |
| b) | In case of causes of the dissolution as determined by the articles of association including the expiration of duration on the issuing company, or order of dissolution or judgment of dissolution from the court, or resolution of dissolution from the general meeting of shareholders |
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| c) | If the issuing company is temporarily or permanently closed with business, or faces significant business suspension or cancellation from the supervising organizations (however, temporary business suspension from the administrative order from the supervising organization shall be excluded). | |
| d) | If there is suspension in transaction from promissory note exchange to the issuing company, or if there is the application of registration on the default list, and other cases when the issuing company is acknowledged to be in insolvent or suspended with payment | |
| B. | Causes of the lost benefit of time on the issuing company: In case of causes occurring on the issuing company, the debenture holder may immediately lose the benefit of time on all or a part of the outstanding principal and claim for the payment of amount added with all the interest amounts calculated by applying the coupon rate. | |
| a) | When the issuing company violates obligations from this agreement | |
| b) | When non-fulfilling obligations to pay for all or a part of the principal of this bond and also the interest on due, or failing to pay for the amount within 5 days of due date | |
| c) | If the payment is not made on principal among debts from the issuing company other than this bond, or if there are causes of lost benefit of time due to financial default, or if the security right on debt has been performed | |
| d) | All or more than 50% of the assets of the issuing company are reported to be applied with injunction or provisional attachment, and if they are not cancelled within 90 days | |
| C. | If the benefit of time on this bond is lost on the issuing company according to A or B in this paragraph, failing to pay for the principal within due date, the overdue interest shall be paid as applied with the interest rate from the next date of the payment to the date of actual payment made in the paragraph 12 of this article. | |
| D. | Issuing company shall immediately notify the underwriter or debenture holder of the occurrence of causes for the lost benefit of time in writing (or overall conditions related to the lost benefit of time along with the delivery of notice/time lapse/confirmation letter issuing courses, or actual cases or behaviors related to them). |
| 23. | Distributing date and place of the bond: Bond shall be issued on the relevant date and distributed to the underwriter. |
| 24. | This bond shall be issued in a method other than the recruitment, and not listed in the stock market. |
| 25. | Matters related to the preemptive right: Preemptive right of this bond shall be separated from the unsecured bond, and issued in kind to the underwriter on the date of bond issuance according to the following conditions. |
| A. | Amount and the face value of the preemptive right:13 KRW 100 million bonds | |
| B. | Types of stocks to be issued in the exercise of securities from the preemptive right to new stocks: Registered ordinary shares from the issuing company |
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| C. | Exercise ratio: 100% of the shares after dividing the face value of securities from the preemptive right to new stocks (the total of face value if exercising preemptive right with more than two bonds with warrant) with the following exercise price of the preemptive right is regarded as the number of exercise shares, and the fractional share shall not be acknowledged. | |
| D. | Exercise price of preemptive right: KRW 500 per share | |
| E. | Adjustment of exercise price of preemptive right (hereinafter referred to as “Exercise Price”) | |
| a) | If the issuing company issues stocks through capital increase by issuing new stocks, share distribution, or capital transfer of reserve in the issuance price that is lower than the market price (including when it is lower than the exercise price prior to the issuance, and same as the following paragraphs) before a part in possession of securities from the preemptive right to new stocks claims to exercise preemptive right, or issues convertible bonds or bonds with warrant with convertible price or exercise price below the market price, the exercise price of preemptive right is adjusted as follows. However, when performing the capital increase both by issuing new stocks or without consideration, when the per-share exercise price of capital increase by issuing new stocks is above the exercise price before the adjustment, the shares of newly issued stocks by the capital increase by issuing new stocks shall not be applied in the adjustment of exercise price but only applied with the newly issued shares from the capital increase without consideration. The date of adjustment of exercise price according to this paragraph shall be the date of issuance of new stocks or convertible bonds or bonds with warrant from the capital increase by issuing new stocks, share distribution, or capital transfer of reserve. |
Exercise price after the adjustment = Exercise price before the adjustment x [{A+(B+C/D)} / (A+B)]
| A. | Issued shares of stocks | |
| B. | Newly issued shares of stocks | |
| C. | Per-share exercise price | |
| D. | Market price |
However, in the above formula, the “issued shares of stocks” shall be the total shares issued as of the date immediately before the cause of the adjustment occurs. In the case of issuing convertible bonds or bonds with warrant, the “issued shares of stocks” shall be the number of shares to be issued if all shares are converted at the conversion price. In addition, the “per-share issuing price” in the above formula is zero (0) in the case of share division, capital increase without consideration, and stock dividend. In the case of issuance of convertible bonds or bonds with warrant, the conversion price or exercise price at the time of issuance of such bonds. In the above formula, “market price” is the reference stock. However, in case of an adjustment due to an issuance that falls below the value of the exercise on the day before the issuance, the exercise value on the day before the issuance shall be).
| b) | In case that an adjustment of the exercise price is required by merger, capital decrease, share division and, etc., securities from the preemptive right to new stocks shall be exercised and acquired in full stock immediately before the merger or capital decrease so that the securities from the preemptive right to new stocks may have the same effect. In the case of mergers, capital decrease, share division, and mergers, the exercise price shall be adjusted taking into account the ratio of each of them. In case that the securities from the preemptive right to new stocks holder have suffered damages due to the issuer’s failure to take these measures, the issuer shall compensate the damages. In addition, the issuing company shall not conduct mergers, splits, and sales transfers in a manner that adversely affects the rights of the holder of the new share acquisition rights. |
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| c) | In case of an increase in the value of the stock, such as the merger of potatoes and shares, the value of the exercise shall be adjusted on the condition that the adjustment ratio due to the merger of potatoes and shares is reflected upward. | |
| d) | If the exercise price adjusted by a) to c) above is less than the face value of the shares, the face value shall be the exercise price, and the total amount of the issue value of the shares to be issued due to the exercise of the preemptive right granted to each bond with warrant shall not exceed the issue value of each new share rights bond. | |
| (e) | Less than one KRW of the exercise price shall be raised after adjustment under this subparagraph. | |
| F. | Preemptive right exercise period: One year after the date of issuance of this bond (July 2, 2022) to one month before the principal redemption date (June 2, 2024). If the end of the exercise period is not a business day, it shall be a business day. If not exercising preemptive right within this period, the preemptive right of these securities from the preemptive right to new stocks will be extinguished. |
| G. | Preemptive right exercise place: Main branch of the publishing company | |
| H. | Preemptive right exercise procedures and methods: | |
| a) | Securities from the preemptive right to new stocks and a predetermined preemptive right exercise claim shall be submitted to the issuer with the necessary information. | |
| b) | The payment of the principal of the new shares issued as a preemptive right exercise shall be paid to the issuer or to the financial institution designated by the issuer or to substitute the new shares into separate bonds of this bond. | |
| c) | In the case of substitute payment, the amount equivalent to a single share of less than one week of the recommendation of the bond shall be paid in cash by the issuing company at the time of the sovereign grant. | |
| I. | When the preemptive right exercise takes effect: In accordance with the preemptive right exercise procedure above, the preemptive right exercise shall take effect when the preemptive right exercise claim and the securities from the preemptive right to new stocks are submitted and the new stock acquisition fee is paid. Shares issued by the preemptive right exercise shall be deemed to have been issued at the time of the effect of the above preemptive right exercise. | |
| J. | How and where the shares issued by the preemptive right exercise are issued: The shares issued by the preemptive right exercise shall be issued by the issuing company or the issuing company’s name and opening agency. | |
| K. | Initial dividend and interest of shares issued due to preemptive right exercise: Shares issued by preemptive right exercise shall have the effect of the dividend as issued as shares at the end of the business year immediately prior to the business year to which the preemptive right exercise claim date belongs, and the interest of bonds with warranty shall not be affected by the preemptive right exercise. | |
| L. | Holding of non-issued shares: The issuer shall hold as unreleased shares the number of shares to be issued due to the preemptive right exercise among the total number of shares to be issued by the issuer until the end of the preemptive right exercise period. | |
| M. | Registration of capital increase by preemptive right exercise: The “issuer” shall perform the registration procedure in accordance with the preemptive right exercise within 5 business days from the date of the preemptive right exercise. |
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| 27. | Special Terms |
| A. | Only the preemptive right (warranty) of this bond may be transferred separately, and the issuer may charge the acquirer to preferentially sell a portion or 100% of the preemptive right to the issuer and the issuer specified within one month before maturity from the date of issue. At this time, a premium of 3% of the preemptive right’s exhortation will be paid. | |
| B. | In case that the largest shareholder of the issuer sells his or her share, he or she shall preferentially repay these bonds prior to the sale, or sell them. | |
| 28. | For matters not set forth in this Agreement, the provisions of Articles 516-2 to 516-11 of the Commercial Code shall be followed |
Article 4 Expenses
Expenses from the issuance of this bond shall be borne by the issuing company in principles. However, the expenses acknowledged by the underwriter of this bond such as the expenses for setting pledges shall be of an exception.
Article 5 Resale of Bonds
| 1. | Underwriter may resell the bond to a third party before the due date of redemption of the bond from a month after issuing the bond. However, underwriter shall not resell the bond to more than 50 people within a year of the issuance. |
| 2. | Rights of the underwriter on the contract in case of resale shall be automatically succeeded to a party acquiring this bond. |
Article 6 Statement and Guarantee of Issuing Company
| 1. | As of the date of this agreement, the issuer shall state and guarantee to the underwriter: |
| A. | The issuing company is legally established and survives in accordance with the laws of the Republic of Korea and has the ability and qualifications to perform the operations it currently performs. The issuing company is not in liquidation or in a state where bankruptcy, corporate regeneration procedures, insolvency signs under the Corporate Structure Adjustment Promotion Act, corporate management procedures and other similar procedures are in progress or are about to be initiated. | |
| B. | The issuing company has performed all of the authorized procedures required by the Board of Directors and/or the General Meeting of Shareholders or articles of association of the issuing company or law in connection with the conclusion of this agreement and the implementation of the contents of this agreement (including the issuance of these bonds to the underwriter). | |
| C. | This agreement has the effect of legally binding the issuer, and if the issuer does not fulfill its contractual obligations, the underwriter may take all legal means to force the issuer to fulfill its obligations. | |
| D. | No laws, court rulings, decisions, and orders exist that substantially limit the issuer’s exercise of rights and obligations under this agreement, and the conclusion and implementation of this agreement by the Issuer shall not violate or conflict with the Articles of Incorporation of the issuer or any other agreement of which the issuer is a party. |
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| E. | The issuing company’s duty to pay taxes is fulfilled. | |
| F. | There shall not be any litigation or legal dispute of a nature that has a significant adverse effect on the financial condition of the issuing company or on the trading relationship under this Agreement as a lawsuit or legal dispute that is currently in progress or expected in the future. | |
| G. | The Issuing company has not (1) issued any other shares or bonds or certificates or securities granting the right to acquire them, other than those disclosed to the underwriter prior to the conclusion of this agreement, and (2)entered into no agreement granting the right to acquire shares or bonds, such as stock options, with respect to common shares already issued, bonds and stock options that have not | |
| H. | All real estate, property, machinery, vehicles, and office equipment held by the issuing company are legally owned by the issuing company or are authorized to be used by the issuing company. | |
| I. | The Issuer shall not be a party to any agreement, agreement, or other agreement that places an unusual burden on the Issuer’s operations and shall not be bound by such agreement, agreement, or other agreement. | |
| J. | The financial statements of the issuing company’s recent business year were prepared in accordance with generally accepted accounting principles in Korea, accurately and fairly represent the issuer’s financial status and operating status, and do not miss significant liabilities (including contingent liabilities). In addition, after the date of the above financial statements, there were no important matters that may adversely affect the financial condition and operating status of the issuing company. | |
| K. | The issuing company legally holds intellectual property rights such as patents, trademarks, and copyrights, as well as licenses from all necessary government and supervisory authorities regarding the sales and assets they currently hold. | |
| L. | The issuing company is not in a situation where it may default on its debts and lose the profits of its due date or initiate forced execution. | |
| M. | The issuing company did not cause dissolution under Article 517 of the Commercial Code and other laws. | |
| N. | Notes or checks issued by the issuing company have not been dishonored or transactions with the bank have not been suspended or prohibited. | |
| O. | The issuing company has no current progress(except if the application for suspension or cancellation of the execution has been accepted) in the event that forced enforcement of the issuing company’s property(including enforcement by a ruling or order) has been carried out or disclosed. |
The issuer shall immediately notify the underwriter if any statement or guarantee made by the issuer under this agreement is false or inaccurate or likely to be made in light of the circumstances at that time at any time before the underwriting payment of the bonds is paid on the date of issue.
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Article 7 Prerequisites of Payment
The underwriter shall acquire this bond and pay the resulting acquisition fee only if the conditions of each of the following paragraphs are met.
| 1. | From the date of this agreement, there will be no event that the (financial or other) circumstances or general affairs of the issuer or its subsidiaries will be changed to a significantly unfavorable state due to the issuance of these bonds or reasonably expected to involve adverse changes |
| 2. | The statements and guarantees provided by the issuing company in this agreement shall be true and accurate as of the date of this agreement and on each date on which the statements and guarantees are deemed to have been made, and the above statements and guarantees shall be true and accurate as to the facts and circumstances existing at the time of payment |
| 3. | There will be no changes that may have a significant adverse effect on the management or financial position of the issuing company as of the date of delivery |
| 4. | As of the date of payment, there will be no default of the issuer’s contractual obligations and the underwriter’s approval conditions |
| 5. | As of the date of payment, the articles of association of the issuing company and the minutes of the board of directors, and other documents required by the underwriter as reasonably necessary shall be filled out and submitted in the content and format that the underwriter satisfies |
Article 8 Proper Law and Competent Court
This agreement and the bond shall be interpreted according to the laws in South Korea as proper law, and lawsuits on this agreement and bond shall be handled in Seoul Central District Court as the competent court for the first trial.
Article 9 Resolution of Objections
Objection from matters not determined in this contract shall be processed in business custom or in negotiation with the issuing company and the underwriter.
Article 10 Notice
Notice from this contract shall be made in writing, and delivered in the following address or number in person, fax, or registered mail.
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Notice to the underwriter:
Changhyuk Kang
106-1203 Banporaemian I park Seochojoongangro 220 Seochogu, Seoul
Phone : 010-4131-7958, Email : KCH@hanryubank.com
Donghoon Park
106-10, 30 Seunghakgil 104bungil, MichuholGu, Incheon
Phone : 010-4488-4858, Email : pdh@hanryubank.com
Notice to the issuing company:
Hanryu Bank Co., Ltd.
Reference: Juhyun Shin
Address: B-dong, Room 1702 at 397 Seochodae-ro, Seocho-gu, Seoul, Korea (Seocho- dong)
Telephone: 02-564-8588
Email: sjh@hanryubank.com
As a proof of the conclusion of this contract, 2 copies of this contract shall be prepared and signed/sealed by each party to keep one copy, respectively.
July 1, 2021
| “Issuing company”: | Hanryu Bank Co., Ltd. |
| CEO Munjung Kang (Signature) | |
| “Underwriter” : | Changhyuk Kang (Signature) |
| Donghoon Park (Signature) |
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Exhibit 10.19
BUSINESS TRANSFER AGREEMENT
This BUSINESS TRANSFER AGREEMENT (the “Agreement”) is made and entered into on June 22, 2022, by and between HANRYU BANK CO., LTD., a corporation incorporated in South Korea (the “Seller”), and KINGDOM HOLDINGS., a corporation incorporated in the Cayman Islands (the “Purchaser”).
Background
The parties hereto desire that Seller sell and transfer to Purchaser and Purchaser purchase and acquire from Seller all of the Cryptocurrency Assets and consummate all of the other transactions contemplated hereby, all on the terms and subject to the conditions set forth in this Agreement (the “Transaction”).
Terms
THEREFORE, in consideration of the mutual covenants contained herein, and intending to be legally bound hereby, the parties hereto agree as follows:
ARTICLE I
THE TRANSACTION
1.1. Sale and Purchase of Assets. (a) Subject to the terms and conditions of this Agreement, at the Closing hereunder, Seller shall sell, assign, transfer, deliver and convey to Purchaser, and Purchaser shall purchase, acquire and accept from Seller, the Acquired Assets as of the Effective Time, free and clear of all Liens, except Permitted Liens, for the Purchase Price specified below in Section 1.3.
(b) As used herein, the term “Acquired Assets” means Seller’s intangible asset, primarily relating to or primarily used in the Blockchain business, other than the Excluded Assets as set forth in Section 1.1. (c) hereof, wherever such properties, assets and rights are located and whether real, personal or mixed, whether accrued, contingent or otherwise, including all of the following to the extent primarily relating to or primarily used in the Business and if and to the extent any of the following does not constitute an Excluded Asset:
(i) existing outstanding cryptocurrency balance of KDC 299,651,320,620 (the “Kingdom Coin”) owned by Seller;
(ii) Blockchain Mainnet (the “Fandomchain”);
(iii) all of the Cryptocurrency Accounts including the FANTOO Wallet.
(c) The Acquired Assets shall not include, and Purchaser shall not purchase and Seller shall retain, any of the following whether or not they primarily relate to or are primarily used in the FANTOO platform business (the “Excluded Assets”):
(i) Notwithstanding the clauses set forth in Section 1.1. (c) to the contrary, the cryptocurrency balance of KDG(the “Kingdom Gold”)
(ii) all cash and cash equivalents including cash, any money deposit with respect to certain units of the lease agreements, funds in time and demand deposits or similar accounts, certificates of deposit, marketable securities, short-term instruments;-deferred charges, security deposits; prepaid expenses and other prepaid items, advanced payments;
(iii) all Contracts existing named by Seller;
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(iv) all trademarks or trade name rights that is not primarily used nor primarily held for use in the conduct of the Business;
(v) all Intellectual Property that is not primarily used nor primarily held for use in the conduct of the Business;
(vi) all personnel records and other books and records that Seller is required by Law to retain in its possession, provided, however, that Purchaser shall be entitled to receive and retain copies of any such books and records (including personnel records relating to Transferred Employees) unless prohibited by applicable Law;
(vii) all rights or choses in action, causes of action, judgments, claims and demands against third parties (other than customers of the Business), in each case to the extent relating to or arising from the Excluded Assets, the Excluded Liabilities or the ownership, use or possession of the Acquired Assets prior to the Effective Time;
(viii) all rights or choses in action, causes of action, judgments, claims and demands against customers of the Business, in each case to the extent relating to or arising from the Excluded Assets or the Excluded Liabilities;
(ix) all losses, loss carry forwards and rights to receive refunds, credits and credit carry forwards with respect to any Taxes to the extent attributable to the period prior to the Effective Time, including interest thereon, and whether or not any of the foregoing is derived from the Business;
(x) any shares of any corporation, interests in any partnership or any ownership or other investment or equity interest, either of record, beneficially or equitably, in any Person;
(xi) all fixture, equipment and vehicles, tools, office equipment, office supplies, production and other supplies and other tangible property.
1.2. Closing. Subject to the terms and conditions of this Agreement, the closing of the sale and purchase of the Acquired Assets (the “Closing”) shall take place at 10:00 A.M., Seoul time, on the seventh Business Day after satisfaction (or waiver) of the conditions to closing set forth in Article 2 hereof (other than those which by their nature are not to be satisfied until Closing, but subject to the satisfaction or waiver of those conditions), or on such other date and at such other time or place as may be mutually agreed upon by the parties hereto (the “Closing Date”). The Closing shall be deemed to be effective as of 11:59 P.M. local time on the Closing Date in each jurisdiction in which the Acquired Assets are located (the “Effective Time”), and Purchaser and Seller agree to acknowledge and use the Effective Time for all purposes, including for accounting and foreign and domestic Tax reporting purposes.
1.3. Purchase Price. (a) Upon the terms and subject to the conditions set forth herein, the aggregate price (the “Purchase Price”) to be paid by Purchaser shall be determined by the gross sales derived by Acquired Assets from June 22, 2022, to December 31, 2024, (the “Gross Sales”) as follows:
(i) In case of the Gross Sales exceeds $74million, the Purchaser shall pay 10% of the Gross Sales to the Seller.
(ii) In case of the Gross Sales exceeds $37million and less than $74million, the Purchaser shall pay 15% of the Gross Sales to the Seller.
(iii) In case of the Gross Sales is less than $37million, the Purchaser would not pay any percentage of the Gross Sales.
(b) Notwithstanding any other clauses herein to the contrary, the Purchaser shall assume the all indebtedness of the Seller related to the Acquired Assets.
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ARTICLE
II
CLOSING CONDITIONS
2.1. Obligation to Purchase. The Purchaser’s obligation to purchase the Acquired Assets and to take the other actions required of it at the Closing, is subject to the satisfaction, at or prior to the Closing, of each of the following conditions (any of which may be waived by the Purchaser, in whole or in part):
(a) Each of the Seller’s representations and warranties in this Agreement must have been true and correct as of the date of this Agreement, and must have been true and accurate as of the Closing Date as if made on the Closing Date;
(b) The Seller must have delivered the Acquired Assets right after signing this Agreement.
2. 2. Obligation to Transfer. Seller’s obligation to Transfer the Acquired Assets and to take the other actions required to be taken by the Seller at the Closing, is subject to the satisfaction, at or prior to the Closing, of each of the following conditions (any of which may be waived by the Seller, in whole or in part)
(a) Each of the Purchaser’s representations and warranties in this Agreement must have been true and correct as of the date of this Agreement, and must have been true and correct as of the Closing Date as if made on the Closing Date;
(b) The Purchaser shall pay the Purchase Price described in Section 1.3.(a), Article I;
(c) The Purchaser must have requested the Creditor to answer whether he/she will consent or not to the assumption of indebtedness described in Section 1.3.(b), Article I;
(d) The Purchaser must have sufficient funds (or access to sufficient funds) available to it to manage Acquired Assets.
ARTICLE III
REPRESENTATIONS and WARRANTIES
The parties hereto represent and warrant respectively each other that each party is a corporation duly organized and validly existing under the laws of the jurisdiction in which it is incorporated.
ARTICLE IV
TERMINATION
4.1. Termination. This Agreement may be terminated at any time prior to Closing:
(a) By mutual written consent of Seller and Purchaser;
(b) By Purchaser, upon written notice to the Seller, if there shall have been (i) a breach of any warranty on the part of the Seller, or if any warranty of Seller shall have become untrue in any respect, or (ii) a breach by Seller of any of its provisions or agreements hereunder and such breach is not cured within 10 days after notice thereof by Purchaser;
(c) By Purchaser, in the event that Seller becomes or is declared insolvent or bankrupt, makes an assignment for the benefit of all or substantially all of its creditors, enters into an agreement for the composition, extension or readjustment of all or substantially all or of its obligations, or becomes the subject of any proceedings related to its liquidation or insolvency or for the appointment of a receiver of similar officer.
(d) By Seller, upon written notice to-the Purchaser, if there shall have be-en-(t) a breach of any warranty on the part of the Purchaser, or if any warranty of Purchaser shall have become untrue in any respect, or (ii) a breach by Purchaser of any of its provisions or agreements hereunder and such breach is not cured within 10 days after notice thereof by Seller;
4.2. Effect of Termination. The termination of this Agreement shall not affect any rights and obligations which have accrued prior to the termination; provided, however, that nothing herein shall relieve any party of any liability before the termination of this Agreement.
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ARTICLE V
INDEMNIFICATION
The parties agree to indemnify and keep indemnified and hold harmless the other Party from and against any and all losses, penalties, judgments, suits, costs, claims, liabilities, assessments, damages, and expenses (including, without limitation, reasonable attorney’s fees and disbursements) incurred by, imposed upon arising from or asserted against the other Party as a result of relating to or arising out of any breach, default or non-compliance under this Agreement.
ARTICLE VI
INTERPRETATION
6.1. Each term defined in the singular form in this Agreement means the plural thereof whenever the plural form is used, and each term defined in the plural form means the singular thereof whenever the singular form is used. The use of a pronoun of any gender is applicable to all genders.
6.2. Unless otherwise specified therein, all terms defined in this Agreement have the meanings as so defined herein when used in any other certificate, report or document made or delivered pursuant hereto.
6.3. The words “hereof,” “herein,” “hereunder” and similar terms when used in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement, and article, section, subsection, schedule, and exhibit references herein are references to articles, sections, subsections, schedules and exhibits to this Agreement unless otherwise specified.
6.4. A reference to any agreement, document or instrument refers to the agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof and as permitted herein.
6.5. Except as otherwise specified, a reference to any applicable law refers to the law as amended, modified, codified, replaced or reenacted, in whole or in part, and in effect from time to time, and to any rules and regulations promulgated thereunder; and a reference to any section or other provision of any applicable law refers to that provision of the law from time to time in effect and constituting the substantive amendment, modification, codification, replacement or reenactment of the referenced section or other provision.
6.6. The words “including” and “include” mean including without limiting the generality of any description preceding such term, the phrase “may not” is prohibitive and not permissive, and the word “or” is not exclusive.
6.7. Unless otherwise stated in this Agreement, in the computation of a period of time from a specified date to a later specified date, the word “from” means “from but excluding” and the words “to” and “until” each means “to and including.”
6.8. In case any provisions contained respectively in the Special Conditions and the General Conditions are discrepant each other, the provisions in the Special Conditions shall take precedence over those in the General Conditions.
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ARTICLE VII
COVENANTS
7.1. Access Information and Documents. The Seller shall afford to the Purchaser and its representatives (including Purchaser’s agents, accountants, counsel, surveyors, financing sources and employees), reasonable access during regular business hours throughout the period from the date of this Agreement to the Closing Date to all their respective books, documents, records, properties and facilities that relate to the Acquired Assets and, during such period, shall furnish as promptly as reasonably practicable to Purchaser all available information as Purchaser reasonably may request to the extent relating to the Agreement. The Seller shall permit Purchaser, its representatives and financing sources reasonable access throughout the period from the date of this Agreement to the Closing Date to discuss matters related to the Business with the officers, directors, employees and auditors of Seller and its Subsidiaries. Notwithstanding the foregoing, no such access shall unreasonably interfere with the operation of the respective business of Seller.
7.2. Specific Performance. The parties hereto acknowledge and agree that damages along would not provide an adequate remedy for any breach or threatened breach of the provisions of this Agreement and therefore that, without prejudice to any and all other rights and remedies a party may have(including but not limited to damages), such party shall be entitled without proof of special damage to the remedies of injunction, specific performance and other equitable relief for any threatened or actual breach of such provisions.
7.3. Confidentiality. (a) At all times after the Closing Date, The Seller shall keep confidential all data, trade secrets, proprietary secrets and any other confidential information regarding the Acquired Assets and not disclose such confidential information to anyone other than Purchaser, except with the express written consent of Purchaser or as required by Law, order or legal process. Confidential information shall not be deemed to include information (i) that is or becomes generally available to the public other than by breach of these confidentiality obligations by Seller, (ii) is or becomes available to Seller from any person who is not subject to any confidentiality obligation to Purchaser, (iii) is developed after the Closing by or on behalf of Seller without reliance on confidential information regarding the Business acquired prior to the Closing or (iv) to the extent Seller uses such information in the ordinary course of its business under any right or license to so use such information from Purchaser. In the event Seller is required by Law, order or legal process to disclose any such confidential information, such person will promptly notify Purchaser in writing so that Purchaser may, at its expense, seek a protective order and/or other motion to prevent or limit the production or disclosure of such confidential information; provided that in the absence of a protective order or the receipt of a waiver from Purchaser after a request in writing therefor is made by any such person, if any such person is legally required to disclose confidential information, such person will be entitled to disclose such information without liability under these confidentiality provisions.
(b) The Purchaser shall keep confidential all data, trade secrets, proprietary secrets and any other confidential information of Seller disclosed heretofore or hereafter by Seller to Purchaser, other than any such information included in the Acquired Assets, and not disclose such confidential information to anyone other than Seller, except with the express written consent of Seller or as required by Law, order or legal process. Confidential information shall not be deemed to include information (i) that is or becomes generally available to the public other than by breach of these confidentiality obligations by Purchaser, (ii) is or becomes available to Purchaser or any of its Affiliates from any person who is not subject to any confidentiality obligation to Seller, (iii) is developed after the Closing by or on behalf of Purchaser or any of its Affiliates without reliance on confidential information of Seller acquired prior to the Closing or (iv) to the extent Purchaser uses such information in the ordinary course of its business under any right or license to so use such information from Seller. In the event Purchaser or any of its Affiliates or representatives is required by Law, order or legal process to disclose any such confidential information, such person will promptly notify Seller in writing so that Seller may, at its expense, seek a protective order and/or other motion to prevent or limit the production or disclosure of such confidential information; provided that in the absence of a protective order or the receipt of a waiver from Seller after a request in writing therefor is made by any such person, if any such person is legally required to disclose confidential information, such person will be entitled to disclose such information without liability under these confidentiality provisions.
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ARTICLE VIII
GOVERNING LAW and JURISDICTION
8.1. Governing Law. This Agreement shall be governed by and construed in accordance with the Laws of the Republic of Korea without giving effect to the rules of conflict of Laws of the Republic of Korea that would require application of any other Law.
8.2. Consent to Jurisdiction. The parties shall consent to and submit to the exclusive jurisdiction of the Seoul Central District Court located in the Republic of Korea in connection with any action, suit or proceeding arising out of or relating to this Agreement, and Seller and Purchaser shall irrevocably waive, to the fullest extent permitted by Law, any objection which it may have to the laying of the venue of any such proceeding brought in such court and any claim that any such proceeding brought in such court has been brought in an inconvenient forum.
ARTICLE IX
MISCELLANEOUS
9.1. Severability. The parties agree that (a) the provisions of this Agreement shall be severable in the event that any provision hereof is held by a court of competent jurisdiction to be invalid, void or otherwise unenforceable, (b) such invalid, void or otherwise unenforceable provision shall be automatically replaced by another provision which is as similar as possible in terms to such invalid, void or otherwise unenforceable provision but which is valid and enforceable and (c) the remaining provisions shall remain enforceable to the fullest extent permitted by Law.
9.2. Notices. All notices, requests, demands and other communications which are required or may be given pursuant to the terms of this Agreement shall be in writing and shall be deemed delivered (a) on the date of delivery when delivered by hand, (b) on the date of transmission when set by facsimile transmission during normal business hours with telephone confirmation of receipt, (c) three (3) days after dispatch when sent by a reputable courier service that maintains record of receipt.
9.3. Successors and Assigns. The Seller shall not assign this Agreement or any of their rights or obligations hereunder without the prior written consent of Purchaser. The Purchaser may at any time assign this Agreement and any of its rights and obligations hereunder to any affiliate of the Purchaser without the consent of the Seller, and to any other party by providing prior notice in writing to the Seller. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided herein.
9.4. Entire Agreement. This Agreement constitutes the entire understanding of the parties with respect to the subject matter hereof, supersedes any prior agreements or understandings, written or oral, between the parties with respect to the subject matter hereof, and is not intended to confer upon any Person other than the parties hereto any benefit, right or remedy.
9.5. Amendment and Waiver. The parties may, by mutual agreement, amend this Agreement in any respect, and any party, as to such party, may (i) extend the time for the performance of any of the obligations of the other party; (ii) waive any inaccuracies or omissions in representations and warranties by the other party; (iii) waive compliance by the other party with any of the provisions or agreements contained herein and performance of any obligations by the other party; and (iv) waive the fulfillment of any condition that is precedent to the performance by such party of any of its obligations under this Agreement. To be effective, any such amendment or waiver must be in writing and be signed by the party providing such waiver or extension, as the case may be. The rights and remedies herein provided are cumulative and are not exclusive of any rights or remedies which any party may otherwise have at law or in equity. The waiver by any party hereto of any breach by the other party of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach by the other party, whether or not similar.
9.6. Construction. The language used in this Agreement shall be deemed to be the language chosen by the parties to express their mutual-intent, and no rule of strict construction shall be applied against-any Party.
9.7. Counterparts. This Agreement may be executed in counterparts, each of which shall be an original, but which together shall constitute one and the same Agreement.
9.8. Further Assurances and Assistance. The parties agree that each will execute and deliver to the other any and all documents, in addition to those expressly provided for herein, that may be necessary or appropriate to effectuate the provisions of this Agreement, whether before, at or after the Closing. The Seller agrees that, at any time and from time to time after the Closing, it will execute and deliver to the Purchaser such further assignments or other written assurances as Purchaser may reasonably request to perfect and protect the purchaser’s title to the Acquired Assets.
* Signatures page(s) follow *
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the day and year first written above.
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Exhibit 10.21
HANRYU HOLDINGS, INC.
May 31, 2023
SUBSCRIBER:
____________________
____________________
RE: Securities Subscription Agreement
To whom it may concern:
This agreement (the “Agreement”) is entered into effective May 31, 2023 by and between Hanryu Holdings, Inc., a Delaware corporation (the “Company”) and [AUTHORIZED PERSON], a natural person (the “Subscriber”). Pursuant to the terms hereof, the Company hereby accepts the offer the Subscriber has made to purchase 760,000 shares of the Company’s common stock $0.001 par value per share (the “Shares”), for a Purchase Price (as defined in Section 1.1) of $10.00 per share.
1. Purchase of Securities.
1.1. Purchase of Shares. For the sum of $7,600,000, or $10.00 per share purchased (the “Purchase Price”), which the Company acknowledges receiving by wire of ready funds from the Subscriber on or prior to the date hereof, the Company hereby issues the Shares to the Subscriber, and the Subscriber hereby purchases the Shares from the Company on the terms and subject to the conditions set forth in this Agreement. Concurrently with the Subscriber’s execution of this Agreement, the Company shall, at its option, deliver to the Subscriber a certificate registered in the Subscriber’s name representing the shares (the “Original Certificate”), or effect such delivery in book-entry form, with such restrictive legends as are described in Section 5.3 hereof.
2. Deliveries.
2.1. Subscriber’s Deliveries. On or prior to the date first written above, Subscriber shall deliver or cause to be delivered to the Company a duly executed copy of the investor questionnaire, attached hereto as Exhibit A to this Agreement (the “Investor Questionnaire”). In addition, on or prior to the date hereof, Subscriber has paid the Purchase Price as provided in Section 1.1.
3. Representations, Warranties and Agreements.
3.1. Subscriber’s Representations, Warranties and Agreements. To induce the Company to issue the Shares to the Subscriber, the Subscriber hereby represents and warrants to the Company and agrees with the Company as follows:
3.1.1. No Government Recommendation or Approval. The Subscriber understands that no federal or state agency has passed upon or made any recommendation or endorsement of the offering of the Shares.
3.1.2. No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Subscriber of the transactions contemplated hereby do not violate, conflict with or constitute a default under (i) the formation and governing documents of the Subscriber, (ii) any agreement, indenture or instrument to which the Subscriber is a party or (iii) any law, statute, rule or regulation to which the Subscriber is subject, or any agreement, order, judgment or decree to which the Subscriber is subject.
3.1.3. Organization and Authority. The Subscriber is a natural person, who possesses all requisite power and authority necessary to carry out the transactions contemplated by this Agreement. Upon execution and delivery by the Subscriber, this Agreement is a legal, valid and binding agreement of Subscriber, enforceable against Subscriber in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance or similar laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
3.1.4. Experience, Financial Capability and Suitability. Subscriber is: (i) sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Shares and (ii) able to bear the economic risk of its investment in the Shares for an indefinite period of time because the Shares have not been registered under the Securities Act (as defined below) and therefore cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available. Subscriber is capable of evaluating the merits and risks of its investment in the Company and has the capacity to protect its own interests. Subscriber must bear the economic risk of this investment until the Shares are sold pursuant to: (i) an effective registration statement under the Securities Act or (ii) an exemption from registration available with respect to such sale. Subscriber is able to bear the economic risks of an investment in the Shares and to afford a complete loss of Subscriber’s investment in the Shares.
3.1.5. Access to Information; Independent Investigation. Prior to the execution of this Agreement, the Subscriber has had the opportunity to ask questions of and receive answers from representatives of the Company concerning an investment in the Company, as well as the finances, operations, business and prospects of the Company, and the opportunity to obtain additional information to verify the accuracy of all information so obtained. In determining whether to make this investment, Subscriber has relied solely on Subscriber’s own knowledge and understanding of the Company and its business based upon Subscriber’s own due diligence investigation and the information furnished pursuant to this paragraph. Subscriber understands that no person has been authorized to give any information or to make any representations which were not furnished pursuant to this Section 2 and Subscriber has not relied on any other representations or information in making its investment decision, whether written or oral, relating to the Company, its operations and/or its prospects.
3.1.6. Regulation D Offering. Subscriber represents that it is an “accredited investor” as such term is defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”) and acknowledges the sale contemplated hereby is being made in reliance on a private placement exemption to “accredited investors” within the meaning of Section 501(a) of Regulation D under the Securities Act or similar exemptions under state law.
3.1.7. Investment Purposes. The Subscriber is purchasing the Shares solely for investment purposes, for the Subscriber’s own account and not for the account or benefit of any other person, and not with a view towards the distribution or dissemination thereof. The Subscriber did not decide to enter into this Agreement as a result of any general solicitation or general advertising within the meaning of Rule 502 under the Securities Act.
3.1.8. Restrictions on Transfer. Subscriber understands the Shares are being offered and sold in a transaction not involving a public offering within the meaning of the Securities Act (including, without limitation, Section 4(a)(2) and/or Regulation 506(b)). Subscriber understands the Shares will be “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, and Subscriber understands that the certificates or book-entries representing the Shares will contain a legend in respect of such restrictions. If in the future the Subscriber decides to offer, resell, pledge or otherwise transfer the Shares, such Shares may be offered, resold, pledged or otherwise transferred only pursuant to: (i) registration under the Securities Act, or (ii) an available exemption from registration. Subscriber agrees that if any transfer of its Shares or any interest therein is proposed to be made, as a condition precedent to any such transfer, Subscriber may be required to deliver to the Company an opinion of counsel satisfactory to the Company. Absent registration or an exemption, the Subscriber agrees not to resell the Shares.
3.1.9. No Governmental Consents. No governmental, administrative or other third party consents or approvals are required, necessary or appropriate on the part of Subscriber in connection with the transactions contemplated by this Agreement.
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3.2. Company’s Representations, Warranties and Agreements. To induce the Subscriber to purchase the Shares, the Company hereby represents and warrants to the Subscriber and agrees with the Subscriber as follows:
3.2.1. Organization and Corporate Power. The Company is a Delaware corporation and is qualified to do business in every jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on the financial condition, operating results or assets of the Company. The Company possesses all requisite corporate power and authority necessary to carry out the transactions contemplated by this Agreement.
3.2.2. No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Company of the transactions contemplated hereby do not violate, conflict with or constitute a default under (i) the Certificate of Incorporation or Bylaws of the Company, (ii) any agreement, indenture or instrument to which the Company is a party or (iii) any law, statute, rule or regulation to which the Company is subject, or any agreement, order, judgment or decree to which the Company is subject.
3.2.3. Title to Securities. Upon issuance in accordance with, and payment pursuant to, the terms hereof, the Shares will be duly and validly issued, fully paid and nonassessable. Upon issuance in accordance with, and payment pursuant to, the terms hereof, the Subscriber will have or receive good title to the Shares, free and clear of all liens, claims and encumbrances of any kind, other than (a) transfer restrictions hereunder and other agreements to which the Shares may be subject which have been notified to the Subscriber in writing, (b) transfer restrictions under federal and state securities laws, and (c) liens, claims or encumbrances imposed due to the actions of the Subscriber.
3.2.4. No Adverse Actions. There are no actions, suits, investigations or proceedings pending, threatened against or affecting the Company which: (i) seek to restrain, enjoin, prevent the consummation of or otherwise affect the transactions contemplated by this Agreement or (ii) question the validity or legality of any transactions or seeks to recover damages or to obtain other relief in connection with any transactions.
4. [Intentionally Omitted]
5. Covenants.
5.1. Subscriber’s Covenants. To induce the Company to issue the Shares to the Subscriber, the Subscriber hereby covenants and agrees with the Company as follows:
5.1.1. Accredited Investor Verification. Subscriber shall deliver to Company a letter from its legal counsel verifying its status as an accredited investor as such term is defined in Rule 501(a) of Regulation D under the Securities Act, and such letter to be made in a form acceptable to Company and its counsel.
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6. Restrictions on Transfer.
6.1. Securities Law Restrictions. Subscriber agrees not to sell, transfer, pledge, hypothecate or otherwise dispose of all or any part of the Shares unless, prior thereto (a) he/she it has received prior written consent of the Company, (b) a registration statement on the appropriate form under the Securities Act and applicable state securities laws with respect to the Shares proposed to be transferred shall then be effective or (c) the Company has received an opinion from counsel reasonably satisfactory to the Company, that such registration is not required because such transaction is exempt from registration under the Securities Act and the rules promulgated by the Securities and Exchange Commission thereunder and with all applicable state securities laws.
6.2. Lock-up. Subscriber agrees that it may be required to be bound by a lock-up agreement with an underwriter in connection with the initial public offering of the Company (or the Company’s successor or newly-organized parent entity) and therefore, Subscriber hereby agrees to execute any such agreement if requested to do so by the Company.
6.3. Restrictive Legends. Any certificates representing the Shares shall have endorsed thereon legends substantially as follows:
“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN THE OPINION OF COUNSEL, IS AVAILABLE.”
6.4. Additional Shares or Substituted Securities. In the event of the declaration of a share dividend, the declaration of an extraordinary dividend payable in a form other than Shares, a spin-off, a share split, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting the Company’s outstanding Shares without receipt of consideration, any new, substituted or additional securities or other property which are by reason of such transaction distributed with respect to any Shares subject to this Section 5 or into which such Shares thereby become convertible shall immediately be subject to this Section 5 and Section 3. Appropriate adjustments to reflect the distribution of such securities or property shall be made to the number and/or class of Shares subject to this Section 5 and Section 3.
6.5. Registration Rights. Subscriber acknowledges that the Shares are being purchased pursuant to an exemption from the registration requirements of the Securities Act and will become freely tradable only after certain conditions are met.
6.6. General Solicitation. Subscriber and Company acknowledge that this offering does not allow, contemplate nor was made pursuant to a general solicitation or advertising under the meaning of Rule 506(b) of Regulation D under the Securities Act.
7. Other Agreements.
7.1. Further Assurances. Subscriber agrees to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement.
7.2. Notices. All notices, statements or other documents which are required or contemplated by this Agreement shall be: (i) in writing and delivered personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic transmission to the address designated in writing, (ii) by facsimile to the number most recently provided to such party or such other address or fax number as may be designated in writing by such party and (iii) by electronic mail, to the electronic mail address most recently provided to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the business day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery to an overnight courier service or five (5) days after mailing if sent by mail.
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7.3. Entire Agreement. This Agreement embodies the entire agreement and understanding between the Subscriber and the Company with respect to the subject matter hereof and supersedes all prior oral or written agreements and understandings relating to the subject matter hereof. No statement, representation, warranty, covenant or agreement of any kind not expressly set forth in this Agreement shall affect, or be used to interpret, change or restrict, the express terms and provisions of this Agreement.
7.4. Modifications and Amendments. The terms and provisions of this Agreement may be modified or amended only by written agreement executed by all parties hereto.
7.5. Waivers and Consents. The terms and provisions of this Agreement may be waived, or consent for the departure therefrom granted, only by a written document executed by the party entitled to the benefits of such terms or provisions. No such waiver or consent shall be deemed to be or shall constitute a waiver or consent with respect to any other terms or provisions of this Agreement, whether or not similar. Each such waiver or consent shall be effective only in the specific instance and for the purpose for which it was given, and shall not constitute a continuing waiver or consent.
7.6. Assignment. The rights and obligations under this Agreement may not be assigned by either party hereto without the prior written consent of the other party.
7.7. Benefit. All statements, representations, warranties, covenants and agreements in this Agreement shall be binding on the parties hereto and shall inure to the benefit of the respective successors and permitted assigns of each party hereto. Nothing in this Agreement shall be construed to create any rights or obligations except among the parties hereto, and no person or entity shall be regarded as a third-party beneficiary of this Agreement.
7.8. Governing Law. This Agreement and the rights and obligations of the parties hereunder shall be construed in accordance with and governed by the laws of Delaware, without giving effect to the conflict of law principles thereof.
7.9. Severability. In the event that any court of competent jurisdiction shall determine that any provision, or any portion thereof, contained in this Agreement shall be unreasonable or unenforceable in any respect, then such provision shall be deemed limited to the extent that such court deems it reasonable and enforceable, and as so limited shall remain in full force and effect. In the event that such court shall deem any such provision, or portion thereof, wholly unenforceable, the remaining provisions of this Agreement shall nevertheless remain in full force and effect.
7.10. No Waiver of Rights, Powers and Remedies. No failure or delay by a party hereto in exercising any right, power or remedy under this Agreement, and no course of dealing between the parties hereto, shall operate as a waiver of any such right, power or remedy of such party. No single or partial exercise of any right, power or remedy under this Agreement by a party hereto, nor any abandonment or discontinuance of steps to enforce any such right, power or remedy, shall preclude such party from any other or further exercise thereof or the exercise of any other right, power or remedy hereunder. The election of any remedy by a party hereto shall not constitute a waiver of the right of such party to pursue other available remedies. No notice to or demand on a party not expressly required under this Agreement shall entitle the party receiving such notice or demand to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the party giving such notice or demand to any other or further action in any circumstances without such notice or demand.
7.11. Survival of Representations and Warranties. All representations and warranties made by the parties hereto in this Agreement or in any other agreement, certificate or instrument provided for or contemplated hereby, shall survive the execution and delivery hereof and any investigations made by or on behalf of the parties.
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7.12. No Broker or Finder. Each of the parties hereto represents and warrants to the other that no broker, finder or other financial consultant has acted on its behalf in connection with this Agreement or the transactions contemplated hereby in such a way as to create any liability on the other. Each of the parties hereto agrees to indemnify and save the other harmless from any claim or demand for commission or other compensation by any broker, finder, financial consultant or similar agent claiming to have been employed by or on behalf of such party and to bear the cost of legal expenses incurred in defending against any such claim.
7.13. Headings and Captions. The headings and captions of the various subdivisions of this Agreement are for convenience of reference only and shall in no way modify or affect the meaning or construction of any of the terms or provisions hereof.
7.14. Counterparts. This Agreement may be executed in one 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 the other party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or any other form of electronic delivery, 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 signature page were an original thereof.
7.15. Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. If an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties hereto and no presumption or burden of proof will arise favoring or disfavoring any party hereto because of the authorship of any provision of this Agreement. The words “include,” “includes,” and “including” will be deemed to be followed by “without limitation.” Pronouns in masculine, feminine, and neuter genders will be construed to include any other gender, and words in the singular form will be construed to include the plural and vice versa, unless the context otherwise requires. The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,” and words of similar import refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited. The parties hereto intend that each representation, warranty, and covenant contained herein will have independent significance. If any party hereto has breached any representation, warranty, or covenant contained herein in any respect, the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of specificity) which such party hereto has not breached will not detract from or mitigate the fact that such party hereto is in breach of the first representation, warranty, or covenant.
7.16. Mutual Drafting. This Agreement is the joint product of the Subscriber and the Company and each provision hereof has been subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto.
8. Indemnification. Each party shall indemnify the other against any loss, cost or damages (including reasonable attorney’s fees and expenses) incurred as a result of such party’s breach of any representation, warranty, covenant or agreement in this Agreement.
[Signature Page Follows]
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If the foregoing accurately sets forth our understanding and agreement, please sign the enclosed copy of this Agreement and return it to us.
| Very truly yours, | ||
| HANRYU HOLDINGS, INC. | ||
| By: | ||
| Name: | Chang Hyuk Kang | |
| Title: | Chief Executive Officer | |
Notice Address: _________________________
|
Accepted and agreed as of the date first written above. | ||
|
/s/ [AUTHORIZED PERSON] |
||
| [AUTHORIZED PERSON] | ||
Notice Address: __________________________________
[Signature Page to Securities Subscription Agreement]
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Exhibit A
ACCREDITED INVESTOR QUESTIONNAIRE
HANRYU HOLDINGS, INC.
This Questionnaire is being distributed to certain individuals and entities which may be offered the opportunity to purchase securities (the “Securities”) of HANRYU HOLDINGS, INC., a Delaware corporation (the “Company”). The purpose of this Questionnaire is to assure the Company that all such offers and purchases will meet the standards imposed by the Securities Act of 1933, as amended (the “Act”), and applicable state securities laws.
All answers will be kept confidential. However, by signing this Questionnaire, the undersigned agrees that this information may be provided by the Company to its legal and financial advisors, and the Company and such advisors may rely on the information set forth in this Questionnaire for purposes of complying with all applicable securities laws and may present this Questionnaire to such parties as it reasonably deems appropriate if called upon to establish its compliance with such securities laws. The undersigned represents that the information contained herein is complete and accurate and will notify the Company of any material change in any of such information prior to the undersigned’s investment in the Company.
For Individual Investors
Accredited Investor Certification. The undersigned makes one of the following representations regarding its income, net worth, status as a “family client” of a “family office,” and/or certain professional certifications or designations and certain related matters and has checked the applicable representation:
| ☐ | The undersigned’s income1 during each of the last two years exceeded $200,000 or, if the undersigned is married or has a spousal equivalent,2 the joint income of the undersigned and the undersigned’s spouse or spousal equivalent, as applicable, during each of the last two years exceed $300,000, and the undersigned reasonably expects the undersigned’s income, from all sources during this year, will exceed $200,000 or, if the undersigned is married or has a spousal equivalent, the joint income of undersigned and the undersigned’s spouse or spousal equivalent, as applicable, from all sources during this year will exceed $300,000. |
| ☐ | The undersigned’s net worth,3 including the net worth of the undersigned’s spouse or spousal equivalent, as applicable, is in excess of $1,000,000 (excluding the value of the undersigned’s primary residence). |
| ☐ | The undersigned is a holder in good standing of one or more of the following certifications or designations administered by the Financial Industry Regulatory Authority, Inc. (FINRA): the Licensed General Securities Representative (Series 7), Licensed Investment Adviser Representative (Series 65), or Licensed Private Securities Offerings Representative (Series 82). |
| ☐ | The undersigned is a “family client,” as defined in rule 202(a)(11)(G)-1 under the Investment Advisers Act of 1940, as amended (the “Advisers Act”), of a family office as defined in rule 202(a)(11)(G)-1 under the Advisers Act, (i) with assets under management in excess of $5,000,000, (ii) that is not formed for the specific purpose of acquiring the securities offered, and (iii) whose prospective investment is directed by a person who has such knowledge and experience in financial and business matters that such family office is capable of evaluating the merits and risks of the prospective investment, and whose prospective investment is directed by such family office pursuant to clause (iii) of this sentence. |
| ☐ | The undersigned cannot make any of the representations set forth above. |
| 1 | For purposes of this Questionnaire, “income” means adjusted gross income, as reported for federal income tax purposes, increased by the following amounts: (a) the amount of any tax exempt interest income received, (b) the amount of losses claimed as a limited partner in a limited partnership, (c) any deduction claimed for depletion, (d) amounts contributed to an IRA or Keogh retirement plan, (e) alimony paid, and (f) any amounts by which income from long-term capital gains has been reduced in arriving at adjusted gross income pursuant to the provisions of Section 1202 of the Code. |
| 2 | For purposes of this Questionnaire, “spousal equivalent” means a cohabitant occupying a relationship generally equivalent to that of a spouse. |
| 3 | For purposes of this Questionnaire, “net worth” means the excess of total assets, excluding your primary residence, at fair market value over total liabilities, including your mortgage or any other liability secured by your primary residence only if and to the extent that it exceeds the value of your primary residence. Net worth should include the value of any other shares of stock or options held by you and your spouse or spousal equivalent and any personal property owned by you or your spouse or spousal equivalent (e.g. furniture, jewelry, other valuables, etc.). For the purposes of calculating joint net worth: joint net worth can be the aggregate net worth of you and your spouse or spousal equivalent; assets need not be held jointly to be included in the calculation. |
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For Entity Investors
Accredited Investor Certification. The undersigned makes one of the following representations regarding its net worth and certain related matters and has checked the applicable representation:
| ☐ | The undersigned is a trust with total assets in excess of $5,000,000 whose purchase is directed by a person with such knowledge and experience in financial and business matters that such person is capable of evaluating the merits and risks of the prospective investment. |
| ☐ | The undersigned is a bank, an investment adviser registered pursuant to Section 203 of the Advisers Act or registered pursuant to the laws of a state, any investment adviser relying on the exemption from registering with the SEC under Section 203(l) or (m) of the Advisers Act, an insurance company, an investment company registered under the United States Investment Company Act of 1940, as amended, a broker or dealer registered pursuant to Section 15 of the United States Securities Exchange Act of 1934, as amended, a business development company, a Small Business Investment Company licensed by the United States Small Business Administration, a Rural Business Investment Company as defined in Section 384A of the Consolidated Farm and Rural Development Act, as amended, a plan with total assets in excess of $5,000,000 established and maintained by a state for the benefit of its employees, or a private business development company as defined in Section 202(a)(22) of the Advisers Act. |
| ☐ | The undersigned is an employee benefit plan and either all investment decisions are made by a bank, savings and loan association, insurance company, or registered investment advisor, or the undersigned has total assets in excess of $5,000,000 or, if such plan is a self-directed plan, investment decisions are made solely by persons who are accredited investors. |
| ☐ | The undersigned is a corporation, limited liability company, partnership, business trust, not formed for the purpose of acquiring the Securities, or an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “Code”), in each case with total assets in excess of $5,000,000. |
| ☐ | The undersigned is an entity in which all of the equity owners (in the case of a revocable living trust, its grantor(s)) qualify under any of the above subparagraphs, or, if an individual, each such individual has a net worth,2 either individually or upon a joint basis with such individual’s spouse or spousal equivalent, as applicable, in excess of $1,000,000 (within the meaning of such terms as used in the definition of “accredited investor” contained in Rule 501 under the Act), or has had an individual income1 in excess of $200,000 for each of the two most recent years, or a joint income with such individual’s spouse or spousal equivalent, as applicable, in excess of $300,000 in each of those years, and has a reasonable expectation of reaching the same income level in the current year. |
| ☐ | The undersigned is an entity, of a type not listed in any of the paragraphs above, which was not formed for the specific purpose of acquiring the securities offered, owning investments in excess of $5,000,000. |
| ☐ | The undersigned is a “family office,” as defined in rule 202(a)(11)(G)-1 under the Advisers Act, (i) with assets under management in excess of $5,000,000, (ii) that is not formed for the specific purpose of acquiring the securities offered, and (iii) whose prospective investment is directed by a person who has such knowledge and experience in financial and business matters that such family office is capable of evaluating the merits and risks of the prospective investment. |
| ☐ | The undersigned is a “family client,” as defined in rule 202(a)(11)(G)-1 under the Advisers Act, of a family office meeting the requirements in the above paragraph and whose prospective investment is directed by such family office pursuant to clause (iii) of the above paragraph. |
| ☐ | The undersigned cannot make any of the representations set forth above. |
[Signature Page Follows]
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In Witness Whereof, the undersigned has executed this Accredited Investor Questionnaire as of the date written below.
| (Signature) | |
| Name of Signing Party | |
| Title of Signing Party | |
| (Address) | |
| (Email) | |
| May __, 2023 |
[Signature page to Accredited Investor Questionnaire]
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