~~0001750106 us-gaap:FairValueInputsLevel2Member 2022-06-30~~

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, ~~2022~~2023

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________to _________

001-39732

Commission File Number

Alset ~~EHome International~~ Inc.

(Exact name of registrant as specified in its charter)

~~delaware~~texas

83-1079861

State or other jurisdiction of

incorporation or organization

(I.R.S. Employer

Identification No.)

4800 Montgomery Lane, Suite 210,

Bethesda, Maryland

20814

(Address of principal executive offices)

(Zip Code)

301-971-3940

Registrant’s telephone number, including area code

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

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock, $0.001 par value		AEI		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August ~~15, 2022,~~14, 2023, there were ~~148,507,188~~9,235,119 shares of the registrant’s common stock $0.001 par value per share, issued and outstanding.

Table of Contents

PART I FINANCIAL INFORMATION	F-1

Item 1. Financial Statements (Unaudited)	F-1

Condensed Consolidated Balance Sheets – June 30, ~~2022~~2023 and December 31, ~~2021~~2022	F-1

Condensed Consolidated Statements of Operations and Other Comprehensive Loss - Three and Six Months Ended June 30, ~~2022~~2023 and ~~2021~~2022	F-2

Condensed Consolidated Statements of Stockholders’ Equity – Three and Six Months Ended June 30, ~~2022~~2023 and ~~2021~~2022	F-3

Condensed Consolidated Statements of Cash Flows – Six Months Ended June 30, ~~2022~~2023 and ~~2021~~2022	~~F-5~~F-4

Notes to Condensed Consolidated Financial Statements	~~F-6~~F-5 – ~~F-38~~F-36

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	3

Item 3. Quantitative and Qualitative Disclosure About Market Risk	11

~~Item 4. Controls and Procedures~~	11

~~PART II OTHER INFORMATION~~	12

Item ~~1. Legal Proceedings~~4. Controls and Procedures	12

~~Item 1A. Risk Factors~~PART II OTHER INFORMATION	12

Item 1. Legal Proceedings	12

Item 1A. Risk Factors	12

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	12

Item 3. Defaults Upon Senior Securities	12

Item 4. Mine Safety Disclosures	12

Item 5. Other Information	12

~~Item 6. Exhibits~~	13

Item 6. Exhibits	13

SIGNATURES	14

Part I. Financial Information

Item 1. Financial Statements.

Alset ~~EHome International~~ Inc. and Subsidiaries

~~Condensed~~ Consolidated Balance Sheets

~~(Unaudited)~~

	June 30, 2022			December 31, 2021			June 30, 2023			December 31, 2022
Assets:
Current Assets:
Cash	$	41,326,946		$	56,061,309		$	28,827,961		$	17,827,383
Restricted Cash		669,321			4,740,870			664,174			694,520
Account Receivables, Net		169,725			39,622			63,778			46,522
Other Receivables		415,012			334,788			7,951,914			446,798
Note Receivables - Related Parties		14,285,929			12,792,671			2,857,383			3,617,176
Prepaid Expense		528,179			1,202,451			237,772			188,070
Inventory		38,742			47,290			38,015			35,020
Investment in Securities at Fair Value		21,218,774			36,337,023			6,695,823			6,288,236
Investment in Securities at Fair Value - Related Party								24,804,737			13,193,089
Investment in Securities at Cost		99,216			99,216			99,802			98,129
Investment in Securities at Equity Method		52,510,133			30,801,129			32,202,734			52,987,224
Deposit		298,147			275,204
Total Current Assets		131,560,124			142,731,573			104,444,093			95,422,167

Real Estate
Rental Properties		25,831,478			24,820,253			31,388,691			31,169,031
Properties under Development		17,309,061			15,695,127			8,056,513			23,449,698
Operating Lease Right-Of-Use Asset		479,528			659,620
Deposit		39,653			39,653
Operating Lease Right-Of-Use Assets, net								1,805,482			1,614,159
Deposits								422,313			536,947
Cash and Marketable Securities Held in Trust Account								20,831,983			-
Goodwill								274,234			-
Property and Equipment, Net		851,476			263,917			1,218,502			1,298,334
Total Assets	$	176,071,320		$	184,210,143		$	168,441,811		$	153,490,336

Liabilities and Stockholders’ Equity:
Current Liabilities:
Accounts Payable and Accrued Expenses	$	2,841,530		$	11,341,789		$	6,131,700		$	2,983,470
Deferred Revenue		89,880			728,343			2,100			21,198
Builder Deposits		-			31,553
Operating Lease Liability		180,524			283,989
Operating Lease Liabilities - current								186,380			45,556
Notes Payable		77,308			317,671			167,898			181,846
Notes Payable - Related Parties		412,848			833,658			16,481			12,668
Total Current Liabilities		3,602,090			13,537,003			6,504,559			3,244,738

Long-Term Liabilities:
Operating Lease Liability		304,158			383,354
Operating Lease Liabilities - noncurrent								1,647,909			1,582,483
Total Liabilities		3,906,248			13,920,357			8,152,468			4,827,221

Temporary Equity
Class A Common Stock of Alset Capital Acquisition Corp subject to possible redemption; 1,976,036 shares at approximately $10.16 per share as of June 30, 2023								19,416,835			-

Stockholders’ Equity:
Preferred Stock, $0.001 par value; 25,000,000 shares authorized, NaN issued and outstanding		-			-
Common Stock, $0.001 par value; 250,000,000 shares authorized; 148,507,188 and 87,368,446 shares issued and outstanding on June 30, 2022 and December 31, 2021, respectively		148,507			87,368
Preferred Stock, $0.001 par value; 25,000,000 shares authorized, none issued and outstanding								-			-
Common Stock, $0.001 par value; 250,000,000 shares authorized; 9,235,119 and 7,422,846 shares issued and outstanding on June 30, 2023 and December 31, 2022, respectively*								9,235			7,423
Additional Paid in Capital		322,302,515			296,181,977			325,967,000			322,534,891
Accumulated Deficit		(163,688,118	)		(148,233,473	)		(198,390,147	)		(188,724,411	)
Accumulated Other Comprehensive Income		558,045			341,646			2,923,279			3,836,063
Total Alset EHome International Stockholders’ Equity		159,320,949			148,377,518
Total Alset Inc. Stockholders’ Equity								130,509,367			137,653,966
Non-controlling Interests		12,844,123			21,912,268			10,363,141			11,009,149
Total Stockholders’ Equity		172,165,072			170,289,786			140,872,508			148,663,115

Total Liabilities and Stockholders’ Equity	$	176,071,320		$	184,210,143		$	168,441,811		$	153,490,336

*	The numbers of outstanding common stock were adjusted retrospectively to reflect 20-for-1 reverse stock split on December 28, 2022

See accompanying notes to condensed consolidated ~~unaudited~~ financial statements.

F-1

Alset ~~EHome International~~ Inc. and Subsidiaries

~~Condensed~~ Consolidated Statements of Operations and Other Comprehensive ~~Loss~~Income

For the Three and Six Months Ended June 30, ~~2022~~2023 and ~~2021~~2022

~~(Unaudited)~~

	2023			2022			2023			2022
	Three- Months Ended June 30,						Six- Months Ended June 30,
	2023			2022			2023			2022

Revenue
Rental	$	690,967		$	403,900		$	1,324,778		$	636,482
Property		18,190,950			246,910			18,190,950			1,288,434
Biohealth		-			132,222			12,786			749,693
Digital Transformation Technology – related party		14,034			7,701			28,074			7,701
Other		257,897			135607			524,196			196,267
Total Revenue		19,153,848			926,340			20,080,784			2,878,577
Operating Expenses
Cost of Sales		11,738,493			550,677			12,427,774			1,665,227
General and Administrative		2,305,859			2,029,925			4,633,244			4,521,153
Total Operating Expenses		14,044,352			2,580,602			17,061,018			6,186,380

Income (Loss) from Operations		5,109,496			(1,654,262	)		3,019,766			(3,307,803	)

Other Income (Expense)
Interest Income		92,388			196,639			131,666			369,039
Foreign Exchange Transaction Gain		1,150,830			2,077,709			362,528			2,485,804
Unrealized Gain (Loss) on Securities Investment		9,027,846			(407,407	)		6,543,729			(1,230,648	)
Unrealized Gain (Loss) on Securities Investment - Related Party		9,812,880			(6,459,968	)		11,109,151			(9,535,742	)
Realized Loss on Securities Investment		(10,557,229	)		(2,918,668	)		(10,688,542	)		(6,355,451	)
Gain (Loss) on Investment on Security by Equity Method		219,888			(79,670	)		(48,388	)		(216,050	)
Loss on Consolidation of Alset Capital Acquisition Corp.		(21,657,036	)		-			(21,657,036	)		-
Finance Costs		-			(2,879	)		-			(450,887	)
Other Income (Expense)		987,531			(734,355	)		1,090,538			550,538
Total Other Expense, Net		(10,922,902	)		(8,328,599	)		(13,156,354	)		(14,383,397	)

Net Loss Before Income Taxes		(5,813,406	)		(9,982,861	)		(10,136,588	)		(17,691,200	)

Income Tax Expense		-			-			-			(222,114	)

Net Loss		(5,813,406	)		(9,982,861	)		(10,136,588	)		(17,913,314	)

Net Loss Attributable to Non-Controlling Interest		(5,556	)		(995,502	)		(470,852	)		(2,458,669	)

Net Loss Attributable to Common Stockholders	$	(5,807,850	)	$	(8,987,359	)	$	(9,665,736	)	$	(15,454,645	)

Other Comprehensive Loss, Net
Unrealized Loss on Securities Investment		-			(591	)		-			(9,714	)
Foreign Currency Translation Adjustment		(2,183,883	)		(3,514,595	)		(1,087,940	)		(4,163,735	)
Comprehensive Loss		(7,997,289	)		(13,498,047	)		(11,224,528	)		(22,086,763	)

Comprehensive Loss Attributable to Non-controlling Interests		(320,903	)		(2,286,174	)		(626,520	)		(3,371,569	)

Comprehensive Loss Attributable to Common Stockholders	$	(7,676,386	)	$	(11,211,873	)	$	(10,598,008	)	$	(18,715,194	)

Net Loss Per Share - Basic and Diluted	$	(0.63	)	$	(1.46	)	$	(1.09	)	$	(2.77	)
Net Loss Per Share - Basic	$	(0.63	)	$	(1.46	)	$	(1.09	)	$	(2.77	)

Weighted Average Common Shares Outstanding - Basic and Diluted		9,235,119			6,144,550	*		8,845,250			5,586,433	*
Weighted Average Common Shares Outstanding - Basic		9,235,119			6,144,550	*		8,845,250			5,586,433	*

*	The numbers of weighted average outstanding common stock - basic and diluted were adjusted retrospectively to reflect 20-for-1 reverse stock split on December 28, 2022

2022 2021 2022 2021
Three Months Ended on June 30, Six Months Ended on June 30,
2022 2021 2022 2021

Revenue
Rental $ 403,900 $ 21,947 $ 636,482 $ 21,947
Property 246,910 4,562,595 1,288,434 8,456,726
Biohealth 132,222 1,958,890 749,693 3,671,673
Digital Transformation Technology – related party 7,701 - 7,701 -
Other 135,607 - 196,267 -
Total Revenue 926,340 6,543,432 2,878,577 12,150,346
Operating Expenses
Cost of Sales 550,677 2,607,950 1,665,227 6,305,804
General and Administrative 2,029,925 8,611,512 4,521,153 10,926,830
Total Operating Expenses 2,580,602 11,219,462 6,186,380 17,232,634

Operating Losses from Operations (1,654,262 ) (4,676,030 ) (3,307,803 ) (5,082,288 )

Other Income (Expense)
Interest Income 196,639 25,656 369,039 56,288
Interest Expense - (262,703 ) - (316,285 )
Foreign Exchange Transaction Gain 2,077,709 958,334 2,485,804 2,421,031
Unrealized Loss on Securities Investment (6,867,375 ) (21,168,905 ) (10,766,390 ) (30,703,914 )
Realized Loss (Gain) on Securities Investment (2,918,668 ) 555,206 (6,355,451 ) 296,961
Loss on Investment on Security by Equity Method (79,670 ) (77,459 ) (216,050 ) (102,306 )
Finance Costs (2,879 ) (50,261,203 ) (450,887 ) (50,844,071 )
Other (Expense) Income (734,355 ) 19,044 550,538 30,300
Total Other Expense, Net (8,328,599 ) (70,212,030 ) (14,383,397 ) (79,161,996 )

Net Loss Income Before Income Taxes (9,982,861 ) (74,888,060 ) (17,691,200 ) (84,244,284 )

Income Tax Expense - (1,264 ) (222,114 ) (452,601 )

Net Loss (9,982,861 ) (74,889,324 ) (17,913,314 ) (84,696,885 )

Net Loss Attributable to Non-Controlling Interest (995,502 ) (8,238,460 ) (2,458,669 ) (11,807,572 )

Net Loss Attributable to Common Stockholders $ (8,987,359 ) $ (66,650,864 ) $ (15,454,645 ) $ (72,889,313 )

Other Comprehensive Loss, Net
Unrealized Loss on Securities Investment (591 ) (35,922 ) (9,714 ) (37,909 )
Foreign Currency Translation Adjustment (3,514,595 ) (1,070,191 ) (4,163,735 ) (2,839,631 )
Comprehensive Loss (13,498,047 ) (75,995,437 ) (22,086,763 ) (87,574,425 )

Comprehensive Loss Attributable to Non-controlling Interests (2,286,174 ) (8,584,838 ) (3,371,569 ) (12,913,762 )

Comprehensive Loss Attributable to Common Stockholders $ (11,211,873 ) $ (67,410,599 ) $ (18,715,194 ) $ (74,660,663 )

Net Loss Per Share - Basic and Diluted $ (0.07 ) $ (6.03 ) $ (0.14 ) $ (7.42 )

Weighted Average Common Shares Outstanding - Basic and Diluted 122,891,000 11,056,534 111,728,663 9,824,059

See accompanying notes to condensed consolidated ~~unaudited~~ financial statements.

F-2

Alset ~~EHome International~~ Inc. and Subsidiaries

~~Condensed~~ Consolidated Statements of Stockholders’ Equity

For the ~~Three and~~ Six Months Ended June 30, ~~2022~~

~~(Unaudited)~~2023

Series A Preferred Stock Series B Preferred Stock Common Stock
Shares Par Value $0.001 Shares Par Value $0.001 Shares Par Value $0.001 Additional Paid in Capital Accumulated Other Comprehensive Income Accumulated Deficit Total Alset EHome International Stockholders’ Equity Non-Controlling Interests Total
Stockholders’ Equity
Balance at January 1, 2022 - $ - - $ - 87,368,446 $ 87,368 $ 296,181,977 $ 341,646 $ (148,233,473 ) $ 148,377,518 $ 21,912,268 $ 170,289,786

Issuance of Stock by Exercising Warrants - - - - 15,819,452 15,820 (11,925 ) - - 3,895 - 3,895

Convert Related Party Note to Common Stock - - - - 10,000,000 10,000 6,203,000 - - 6,213,000 - 6,213,000

Deconsolidate Alset Capital Acquisition - - - - - - 17,160,800 - - 17,160,800 2,227,744 19,388,544

Gain from Purchase of DSS Stock - - - - - - 737,572 - - 737,572 - 737,572

Beneficial Conversion Feature Intrinsic Value, Net - - - - - - 450,000 - - 450,000 - 450,000

Change in Non-Controlling Interests - - - - - - (316,459 ) 459,069 - 142,610 (142,610 ) -

Change in Unrealized Loss on Investment - - - - - - - (7,027 ) - (7,027 ) (2,096 ) (9,123 )

Foreign Currency Translations - - - - - - - (499,967 ) - (499,967 ) (149,173 ) (649,140 )

Net Loss - - - - - - - - (6,467,286 ) (6,467,286 ) (1,463,167 ) (7,930,453 )

Balance at March 31, 2022 - $ - - $ - 113,187,898 $ 113,188 $ 320,404,965 $ 293,721 $ (154,700,759 ) $ 166,111,115 $ 22,382,966 $ 188,494,081

Issuance of Common Stock 35,319,290 $ 35,319 $ (35,319 ) - - - - -

Change in Valuation on Investment - - - - - - (2,624,585 ) - - (2,624,585 ) (206,377 ) (2,830,962 )

Change in Non-Controlling Interests - - - - - - 4,557,454
3,266,996
-
7,824,450
(7,824,450 ) -

Change in Unrealized Loss on Investment - - - - - - - (505 ) - (505 ) (86 ) (591 )

Foreign Currency Translations - - - - - - - (3,002,167 ) - (3,002,167 ) (512,428 ) (3,514,595 )

Net Loss - - - - - - - - (8,987,359 ) (8,987,359 ) (995,502 ) (9,982,861 )

Balance at June 30, 2022 - $ - - $ - 148,507,188 $ 148,507 $ 322,302,515 $ 558,045 $ (163,688,118 ) $ 159,320,949 $
12,844,123
$
172,165,072


	Series A Preferred Stock				Series B Preferred Stock				Common Stock				Additional		Accumulated Other						Total Alset			Non-			Total
	Shares		Par Value $0.001		Shares		Par Value $0.001		Shares		Par Value $0.001		Paid in Capital		Comprehensive Income			Accumulated Deficit			Stockholders’ Equity			Controlling Interests			Stockholders’ Equity
Balance at January 1, 2023		-	$	-		-	$	-		7,422,846	$	7,423	$	322,534,891	$	3,836,063		$	(188,724,411	)	$	137,653,966		$	11,009,149		$	148,663,115

Issuance of Common Stock										1,812,273		1,812		3,432,109		-			-			3,433,921			-			3,433,921

Foreign Currency Translations										-		-		-		936,265			-			936,265			159,678			1,095,943

Net Loss				-				-		-		-		-		-			(3,857,886	)		(3,857,886	)		(465,296	)		(4,323,182	)

Balance at March 31, 2023		-	$	-		-	$	-		9,235,119	$	9,235	$	325,967,000	$	4,772,328		$	(192,582,297	)	$	138,166,266		$	10,703,531		$	148,869,797

Foreign Currency Translations										-	$	-	$	-		(1,849,049	)		-			(1,849,049	)		(334,834	)		(2,183,883	)

Net Loss				-				-		-	$	-	$	-		-			(5,807,850	)		(5,807,850	)		(5,556	)		(5,813,406	)

Balance at June 30, 2023		-	$	-		-	$	-		9,235,119		9,235		325,967,000		2,923,279			(198,390,147	)		130,509,367			10,363,141		$	140,872,508

~~F-3~~

Alset ~~EHome International~~ Inc. and Subsidiaries

~~Condensed~~ Consolidated Statements of Stockholders’ Equity

For the ~~Three and~~ Six Months Ended June 30, ~~2021~~2022

~~(Unaudited)~~

Series A Preferred Stock Series B Preferred Stock Common Stock
Shares Par Value $0.001 Shares Par Value $0.001 Shares Par Value $0.001 Additional Paid in Capital Accumulated Other Comprehensive Income Accumulated Deficit Total Alset EHome International Stockholders’ Equity Non-Controlling Interests Total
Stockholders’ Equity
Balance at January 1, 2021 (As Combined) - $ - - $ - 8,570,000 $ 8,570 $ 102,729,944 $ 2,143,338 $ (44,910,297 ) $ 59,971,555 $ 38,023,260 $ 97,994,815

Issuance of Stock for Services - - - - 10,000 10 60,890 - - 60,900 - 60,900

Transactions under Common Control - - - - - - (57,190,499 ) - - (57,190,499 ) - (57,190,499 )

Sale of Vivacitas to Related Party - - - - - - 2,279,872 - - 2,279,872 - 2,279,872

Purchase Stock of True Partner from Related Party - - - - - - 3,274,060 - - 3,274,060 - 3,274,060

Beneficial Conversion Feature Intrinsic Value, Net - - - - - - 50,770,192 - - 50,770,192 - 50,770,192

Subsidiary’s Issuance of Stock - - - - - - 46,099 - - 46,099 34,677 80,776

Proceeds from Selling Subsidiary Equity - - - - - - 142,675.00 - - 142,675 107,325 250,000

Change in Non-Controlling Interest - - - - - - 76,412 (39,067 ) - 37,345 (37,345 ) -

Change in Unrealized Loss on Investment - - - - - - - (1,135 ) - (1,135 ) (852 ) (1,987 )

Foreign Currency Translations - - - - - - - (1,010,527 ) - (1,010,527 ) (758,913 ) (1,769,440 )

Distribution to Non-Controlling Shareholders - - - - - - - - - - (82,250 ) (82,250 )

Net Loss - - - - - - - - (6,238,449 ) (6,238,449 ) (3,569,112 ) (9,807,561 )

Balance at March 31, 2021 - - - - 8,580,000 8,580 102,189,645 1,092,609 (51,148,746 ) 52,142,088 33,716,790 85,858,878

Issuance of Common Stock 8,389,324 8,389 39,260,191 - - 39,268,580 0 39,268,580

Change Common stock to Series A Preferred Stock 6,380 6 - - (6,380,000 ) (6,380 ) 6,374 - - - 0 -

Issuance of Series B Preferred Stock 2,132 2 - - 12,999,998 - - 13,000,000 0 13,000,000

Convert Preferred Stock Series A and B to Common (6,380 ) (6 ) (2,132 ) (2 ) 8,512,000 8,512 (8,503 ) - - - 0 -

Change in Non-Controlling Interest - - - - (2,885,117 ) (343,225 ) - (3,228,342 ) 3,228,342 -

Convertible Note to Stock - - - - 9,163,965 9,164 51,217,402 - - 51,226,566 - 51,226,566

Subsidiary’s Issuance of Stock - - - - - - 1,961,349 - - 1,961,349 784,100 2,745,449

Proceeds from Selling Subsidiary Equity - - - - - - 21,432 - - 21,432 8,568 30,000

Change in Unrealized Loss on Investment - - - - - - - (25,663 ) - (25,663 ) (10,259 ) (35,922 )

Foreign Currency Translations - - - - - - - (764,544 ) - (764,544 ) (305,647 ) (1,070,191 )

Distribution to Non-Controlling Shareholders - - - - - - - - (1,069,250 ) (1,069,250 )

Net Loss - - - - - - - - $ (66,650,864 ) $ (66,650,864 ) (8,238,460 ) (74,889,324 )

Balance at June 30, 2021 - $ - - $ - 28,265,289 $ 28,265 $ 204,762,770 $ (40,823 ) $ (117,799,610 ) $ 86,950,602 $ 28,114,184 $ 115,064,786


	Series A Preferred Stock				Series B Preferred Stock				Common Stock					Additional			Accumulated Other						Total Alset			Non-			Total
	Shares		Par Value $0.001		Shares		Par Value $0.001		Shares			Par Value $0.001		Paid in Capital			Comprehensive Income			Accumulated Deficit			Stockholders’ Equity			Controlling Interests			Stockholders’ Equity
Balance at January 1, 2022		-	$	-		-	$	-		87,368,446		$	87,368	$	296,181,977		$	341,646		$	(148,233,473	)	$	148,377,518		$	21,912,268		$	170,289,786

Issuance of Stock by Exercising Warrants				-				-		15,819,452			15,820		(11,925	)		-			-			3,895			-			3,895

Convert Related Party Note to Common Stock										10,000,000			10,000		6,203,000			-			-			6,213,000			-			6,213,000

Deconsolidate Alset Capital Acquisition										-			-		17,160,800			-			-			17,160,800			2,227,744			19,388,544

Gain from Purchase Stock DSS										-			-		737,572			-			-			737,572			-			737,572

Beneficial Conversion Feature Intrinsic Value, Net										-			-		450,000			-			-			450,000			-			450,000

Change in Non-Controlling Interest										-			-		(316,459	)		459,069			-			142,610			(142,610	)		-

Change in Unrealized Loss on Investment										-			-		-			(7,027	)		-			(7,027	)		(2,096	)		(9,123	)

Foreign Currency Translations										-			-		-			(499,967	)		-			(499,967	)		(149,173	)		(649,140	)

Net Loss										-			-		-			-			(6,467,286	)		(6,467,286	)		(1,463,167	)		(7,930,453	)

Balance at March 31, 2022		-	$	-		-	$	-		113,187,898		$	113,188	$	320,404,965		$	293,721		$	(154,700,759	)	$	166,111,115		$	22,382,966		$	188,494,081
Balance		-	$	-		-	$	-		113,187,898		$	113,188	$	320,404,965		$	293,721		$	(154,700,759	)	$	166,111,115		$	22,382,966		$	188,494,081

Issuance of Common Stock				-				-		35,319,290			35,319		(35,319	)		-			-			-			-			-

Change in Valuation on Investment										-			-		(2,624,585	)		-			-			(2,624,585	)		(206,377	)		(2,830,962	)

Change in Non-Controlling Interest										-	��		-		4,557,454			3,266,996			-			7,824,450			(7,824,450	)		-

Change in Unrealized Loss on Investment										-			-		-			(505	)		-			(505	)		(86	)		(591	)

Foreign Currency Translations										-			-		-			(3,002,167	)		-			(3,002,167	)		(512,428	)		(3,514,595	)

Net Loss										-			-		-			-			(8,987,359	)		(8,987,359	)		(995,502	)		(9,982,861	)

Balance at June 30, 2022		-	$	-		-	$	-		148,507,188		$	148,507	$	322,302,515		$	558,045		$	(163,688,118	)	$	159,320,949		$	12,844,123		$	172,165,072
Balance		-	$	-		-	$	-		148,507,188		$	148,507	$	322,302,515		$	558,045		$	(163,688,118	)	$	159,320,949		$	12,844,123		$	172,165,072

See accompanying notes to condensed consolidated ~~unaudited~~ financial statements.

~~F-4~~F-3

Alset ~~EHome International~~ Inc. and Subsidiaries

~~Condensed~~ Consolidated Statements of Cash Flows

For the Six Months Ended June 30, ~~2022~~2023 and ~~2021~~2022

(Unaudited)

2022 2021

Cash Flows from Operating Activities
Net Loss from Operations $ (17,913,314 ) $ (84,696,885 )
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Depreciation 349,403 34,164
Amortization of Right-Of-Use Asset 180,092 259,691
Amortization of Debt Discount 450,000 50,813,099
Shared-based Compensation & Expense - 133,983
Foreign Exchange Transaction Gain (2,485,804 ) (2,421,031 )
Unrealized Loss on Securities Investment
10,766,390
30,703,914
Realized Loss on Securities Investment 6,355,451 -
Loss on Exchange of Investment Securities 852,061 -
PPP Loan Forgiveness (68,502 ) -
Director Compensation Adjustment (1,185,251 ) -
Loss on Equity Method Investment 216,050 102,306
Changes in Operating Assets and Liabilities
Real Estate (2,274,959 ) (2,584,817 )
Account Receivables (160,327 ) (6,503 )
Prepaid Expense 515,568 (1,480,203 )
Trading Securities 1,072,263 (952,509 )
Inventory 7,470 33,236
Accounts Payable and Accrued Expenses (9,398,591 ) 173,892
Other Receivable - Related Parties (2,551,127 )
Accrued Interest - Related Parties - 73,903
Deferred Revenue (638,463 ) 52,057
Operating Lease Liability (182,661 ) (167,161 )
Builder Deposits (31,553 ) (720,987 )
Net Cash Used in Operating Activities (16,125,804 ) (10,649,851 )

Cash Flows from Investing Activities
Loan Receivable - Related Party (111,112 ) -
Purchase of Fixed Assets (210,319 ) (87,044 )
Purchase of Real Estate Properties (722,817 ) -
Real Estate Improvements (602,161 ) -
Purchase of Investment Securities (6,662,017 ) (758,208 )
Sales of Investment Securities to Related Party - 2,480,000
Issuing Loan Receivable - Related Party - (240,129 )
Proceeds from Loan Receivable - Related Party - 840,000
Net Cash (Used in) Provided by Investing Activities (8,308,426 ) 2,234,619

Cash Flows from Financing Activities
Proceeds from Common Stock Issuance 6,213,000 39,268,580
Proceeds from Exercise of Subsidiary Warrants - 2,753,203
Proceeds from Sale of Subsidiary Shares - 280,000
Dividend Paid on Subsidiary Preferred Stock - (73,750 )
Borrowing from PPP Loan - 68,502
Distribution to Non-controlling Interest Shareholders - (1,151,500 )
Repayment to Notes Payable (171,861 ) (690,035 )
Proceeds from Note Payable - Related Parties - 5,545,495
Repayment to Notes Payable - Related Parties - (2,102,400 )
Net Cash Provided by Financing Activities 6,041,139 43,898,095

Net (Decrease) Increase in Cash and Restricted Cash (18,393,091 ) 35,482,863
Effects of Foreign Exchange Rates on Cash (412,821 ) (293,205 )
Cash and Restricted Cash - Beginning of Period 60,802,179 31,735,479
Cash and Restricted Cash- End of Period $ 41,996,267 $ 66,925,137

Supplementary Cash Flow Information
Cash Paid for Interest $ 1,524 $ 14,454
Cash Paid for Taxes $ - $ 451,410

Supplemental Disclosure of Non-Cash Investing and Financing Activities
Unrealized Gain (Loss) on Investment $ 727,858 $ (37,909 )
Initial Recognition of ROU / Lease Liability $ - $ 256,928
Acquiring True Partner Stock $ - $ 10,003,689
Sale of Investment in Vivacitas to Related Party $ - $ 2,279,872
Deconsolidate Alset Capital Acquisition $ 16,557,582 $ -
Intrinsic Value of BCF $ (450,000 ) $ (50,770,192 )
Issuance of Stock by Exercising Warrants $ 3,895 $ -
Transactions under Common Control $ - $ 57,190,499
Convert Related Party Note Payable to Common Stock $ - $ 64,226,566

	2023			2022

Cash Flows from Operating Activities
Net Loss from Operations	$	(10,136,588	)	$	(17,913,314	)
Adjustments to Reconcile Net Loss to Net Cash Provided by (Used in) Operating Activities:
Depreciation		606,434			349,403
Amortization of Right-Of-Use Assets		523,591			180,092
Amortization of Debt Discount		-			450,000
Loss on Consolidation of Alset Capital Acquisition Corp.		21,657,036			-
Foreign Exchange Transaction Gain		(362,528	)		(2,485,804	)
Unrealized (Gain) Loss on Securities Investment		(6,543,729	)		1,230,648
Unrealized (Gain) Loss on Securities Investment - Related Party		(11,109,151	)		9,535,742
Realized Loss on Securities Investment		10,688,542			6,355,451
(Gain) Loss on Exchange of Investment Securities		(502,497	)		852,061
PPP Loan Forgiveness		-			(68,502	)
Director Compensation Adjustment		-			(1,185,251	)
Loss on Equity Method Investment		48,388			216,050
Changes in Operating Assets and Liabilities, net of acquisitions
Real Estate		15,393,185			(2,274,959	)
Account Receivables		(7,280,286	)		(160,327	)
Prepaid Expense		(11,664	)		515,568
Deposits		2,935			-
Trading Securities		(4,593,961	)		1,072,263
Inventory		(3,889	)		7,470
Accounts Payable and Accrued Expenses		(364,372	)		(9,398,591	)
Other Receivables - Related Parties		(55,000	)		(2,551,127	)
Deferred Revenue		(19,098	)		(638,463	)
Operating Lease Liabilities		(527,578	)		(182,661	)
Builder Deposits		-			(31,553	)
Net Cash Provided by (Used in) Operating Activities		7,409,770			(16,125,804	)

Cash Flows from Investing Activities
Loan Receivable - Related Party		-			(111,112	)
Purchase of Fixed Assets		(11,726	)		(210,319	)
Purchase of Real Estate Properties		-			(722,817	)
Real Estate Improvements		(734,688	)		(602,161	)
Purchase of Investment Securities		(692,219	)		(6,662,017	)
Acquisition of Subsidiary		(214,993	)		-
Issuing Loan Receivable - Related Party		(1,628,010	)		-
Proceeds from Loan Receivable - Related Party		2,674,653			-
Net Cash Used in Investing Activities		(606,983	)		(8,308,426	)

Cash Flows from Financing Activities
Proceeds from Common Stock Issuance		3,433,921			6,213,000
Repayment to Notes Payable		(16,950	)		(171,861	)
Net Cash Provided by Financing Activities		3,416,971			6,041,139

Net Increase (Decrease) in Cash and Restricted Cash		10,219,758			(18,393,091	)
Effects of Foreign Exchange Rates on Cash		750,474			(412,821	)
Cash and Restricted Cash - Beginning of Year		18,521,903			60,802,179
Cash and Restricted Cash- End of Period	$	29,492,135		$	41,996,267

Cash	$	28,827,961		$	41,326,946
Restricted Cash	$	664,174		$	669,321
Total Cash and Restricted Cash	$	29,492,135		$	41,996,267

Supplementary Cash Flow Information
Cash Paid for Interest	$	2,007		$	1,524
Cash Paid for Taxes	$	-		$	-

Supplemental Disclosure of Non-Cash Investing and Financing Activities
Unrealized Gain on Investment	$	-		$	727,858
Initial Recognition of ROU / Lease Liability	$	157,647		$	-
Deconsolidate Alset Capital Acquisition	$	-		$	16,557,582
Intrinsic Value of BCF	$	-		$	(450,000	)
Issuance of Stock by Exercising Warrants	$	-		$	3,895

See accompanying notes to condensed consolidated ~~unaudited~~ financial statements.

~~F-5~~F-4

Alset ~~EHome International~~ Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Six Months Ended June 30, ~~2022~~2023 and ~~2021~~2022

(Unaudited)

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

Alset ~~EHome International~~ Inc. (the “Company” or “AEI”), formerly known as Alset EHome International Inc. and HF Enterprises Inc., was incorporated in the State of Delaware on March 7, ~~2018 and~~ ~~1,000~~ ~~shares of common stock~~2018. On October 4, 2022, through a merger transaction, the Company was ~~issued to Chan Heng Fai, the founder, Chairman and Chief Executive Officer of the Company.~~reincorporated in Texas. AEI is a diversified holding company principally engaged through its subsidiaries in the development of EHome communities and other real estate, financial services, digital transformation technologies, biohealth activities and consumer products with operations in the United States, Singapore, Hong Kong, Australia and South Korea. ~~The Company manages its principal~~We manage a significant portion of our businesses ~~primarily~~ through ~~its~~our 85.4% owned subsidiary, Alset International Limited (“Alset International”~~, f.k.a. Singapore eDevelopment Limited)~~), a public company ~~publicly~~ traded on the Singapore Stock Exchange.

The Company has four operating segments based on the products and services we offer, which include three of our principal businesses – real estate, digital transformation technology and biohealth – as well as a fourth category consisting of certain other business activities.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The Company’s condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and following the requirements of the Securities and Exchange Commission (“SEC”) for interim reporting. These interim financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results to be expected for the year ending December 31, ~~2022~~2023 or any other interim periods or for any other future years. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the Company’s Form 10-K for the year ended December 31, ~~2021~~2022 filed on March 31, ~~2022.~~2023.

The condensed consolidated financial statements include all accounts of the Company and its majority owned and controlled subsidiaries. The Company consolidates entities in which it owns more than 50% of the voting common stock and controls operations. All intercompany transactions and balances among consolidated subsidiaries have been eliminated.

~~F-6~~F-5

The Company’s condensed consolidated financial statements include the financial position, results of operations and cash flows of the following entities as of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, as follows:

SCHEDULE OF SUBSIDIARIES

		Attributable interest as of,
Name of subsidiary consolidated under AEI	State or other jurisdiction of incorporation or organization	June 30, 2022			December 31, 2021
Name of subsidiary								State or other jurisdiction of	Attributable interest as of,
consolidated under AEI								incorporation or organization	June 30, 2023			December 31, 2022
			%			%			%			%
Alset Global Pte. Ltd.	Singapore		100			100		Singapore		100			100
Alset Business Development Pte. Ltd.	Singapore		100			100		Singapore		100			100
Global eHealth Limited	Hong Kong		100			100		Hong Kong		100			100
Alset International Limited	Singapore		85.4			76.8		Singapore		85.4			85.4
Singapore Construction & Development Pte. Ltd.	Singapore		85.4			76.8		Singapore		85.4			85.4
Art eStudio Pte. Ltd.	Singapore		43.6	*		39.2	*	Singapore		43.6	*		43.6	*
Singapore Construction Pte. Ltd.	Singapore		85.4			76.8		Singapore		85.4			85.4
Global BioMedical Pte. Ltd.	Singapore		85.4			76.8		Singapore		85.4			85.4
Alset Innovation Pte. Ltd.	Singapore		85.4			76.8		Singapore		85.4			85.4
Health Wealth Happiness Pte. Ltd.	Singapore		85.4			76.8		Singapore		85.4			85.4
SeD Capital Pte. Ltd.	Singapore		85.4			76.8		Singapore		85.4			85.4
LiquidValue Asset Management Pte. Ltd.	Singapore		85.4			76.8		Singapore		85.4			85.4
Alset Solar Limited	Hong Kong		85.4			76.8		Hong Kong		85.4			85.4
Alset F&B One Pte. Ltd	Singapore		76.9			69.2		Singapore		76.9			76.9
Global TechFund of Fund Pte. Ltd.	Singapore		85.4			76.8		Singapore		-			100
Singapore eChainLogistic Pte. Ltd.	Singapore		85.4			76.8		Singapore		-			100
BMI Capital Partners International Limited.	Hong Kong		85.4			76.8		Hong Kong		85.4			85.4
SeD Perth Pty. Ltd.	Australia		85.4			76.8		Australia		85.4			85.4
SeD Intelligent Home Inc.	United States of America		85.4			76.8		United States of America		85.4			85.4
LiquidValue Development Inc.	United States of America		85.4			76.8		United States of America		85.4			85.4
Alset EHome Inc.	United States of America		85.4			76.8		United States of America		85.4			85.4
SeD USA, LLC	United States of America		85.4			76.8		United States of America		85.4			85.4
150 Black Oak GP, Inc.	United States of America		85.4			76.8		United States of America		85.4			85.4
SeD Development USA Inc.	United States of America		85.4			76.8		United States of America		85.4			85.4
150 CCM Black Oak, Ltd.	United States of America		85.4			76.8		United States of America		85.4			85.4
SeD Texas Home, LLC	United States of America		85.4			76.8		United States of America		100			85.4
SeD Ballenger, LLC	United States of America		85.4			76.8		United States of America		85.4			85.4
SeD Maryland Development, LLC	United States of America		71.4			64.2		United States of America		71.4			71.4
SeD Development Management, LLC	United States of America		72.6			65.3		United States of America		72.6			72.6
SeD Builder, LLC	United States of America		85.4			76.8		United States of America		85.4			85.4
GigWorld Inc.	United States of America		85.2			76.6
Hapi Metaverse Inc. (f.k.a. GigWorld Inc.)								United States of America		99.7			99.7
HotApp BlockChain Pte. Ltd.	Singapore		85.2			76.6		Singapore		99.7			99.7
HotApp International Limited	Hong Kong		85.2			76.6		Hong Kong		99.7			99.7
HWH International, Inc. (Delaware)	United States of America		85.4			76.8		United States of America		85.4			85.4
Health Wealth & Happiness Inc.	United States of America		85.4			76.8		United States of America		85.4			85.4
HWH Multi-Strategy Investment, Inc.	United States of America		85.4			76.8		United States of America		85.4			85.4
SeD REIT Inc.								United States of America		85.4			85.4
Gig Stablecoin Inc.								United States of America		99.7			99.7
HWH World Inc. (Delaware)								United States of America		99.7			99.7
HWH World Pte. Ltd.								Singapore		85.4			85.4
UBeauty Limited								Hong Kong		85.4			85.4
WeBeauty Korea Inc								Korea		85.4			85.4
HWH World Limited								Hong Kong		85.4			85.4
HWH World Inc.								Korea		85.4			85.4
GDC REIT Inc.								United States of America		85.4			85.4

~~F-7~~F-6

SeD REIT Inc.	United States of America	85.4		76.8
Gig Stablecoin Inc.	United States of America	85.2		76.6
HWH World Inc. (Delaware)	United States of America	85.2		76.6
HWH World Pte. Ltd.	Singapore	85.4		76.6
UBeauty Limited	Hong Kong	85.4		76.8
WeBeauty Korea Inc	Korea	85.4		76.8
HWH World Limited	Hong Kong	85.4		76.8
HWH World Inc.	Korea	85.4		76.8
Alset BioHealth Pte. Ltd.	Singapore	-		76.8
Alset Energy Pte. Ltd.	Singapore	-		76.8
Alset Payment Inc. (now known as GDC REIT Inc.)	United States of America	85.4		76.8
Alset World Pte. Ltd.	Singapore	-		76.8
Name of subsidiary						State or other jurisdiction of	Attributable interest as of,
consolidated under AEI						incorporation or organization	June 30, 2023			December 31, 2022
BioHealth Water Inc.	United States of America	85.4		76.8		United States of America		85.4			85.4
Impact BioHealth Pte. Ltd.	Singapore	85.4		76.8		Singapore		85.4			85.4
American Home REIT Inc.	United States of America	85.4		76.8		United States of America		100			85.4
Alset Solar Inc.	United States of America	68.3		61.5		United States of America		68.3			68.3
HWH KOR Inc.	United States of America	85.4		76.8		United States of America		85.4			85.4
Open House Inc.	United States of America	85.4		76.8		United States of America		-			100
Open Rental Inc.	United States of America	85.4		76.8		United States of America		-			100
Hapi Cafe Inc. (Nevada)	United States of America	85.4		76.8		United States of America		-			100
Global Solar REIT Inc.	United States of America	85.4		76.8		United States of America		-			100
OpenBiz Inc.	United States of America	85.4		76.8
Alset EV Inc. (f.k.a. OpenBiz Inc.)						United States of America		100			100
Hapi Cafe Inc. (Texas)	United States of America	85.6		100		United States of America		85.4			85.4
HWH (S) Pte. Ltd.	Singapore	85.4		76.8		Singapore		85.4			85.4
True Partner International Limited	Hong Kong	-		100
LiquidValue Development Pte. Ltd.	Singapore	100		100		Singapore		100			100
LiquidValue Development Limited	Hong Kong	100		100		Hong Kong		100			100
EPowerTech Inc.	United States of America	100		100		United States of America		-			100
Alset EPower Inc.	United States of America	100		100		United States of America		-			100
AHR Asset Management Inc.	United States of America	85.4		76.8		United States of America		85.4			85.4
HWH World Inc. (Nevada)	United States of America	85.4		76.8		United States of America		85.4			85.4
Alset F&B Holdings Pte. Ltd.	Singapore	85.4		76.8		Singapore		85.4			85.4
Credas Capital Pte. Ltd.	Singapore	42.7	*	38.4	*	Singapore		42.7	*		42.7	*
Credas Capital GmbH	Switzerland	42.7	*	38.4	*	Switzerland		42.7	*		42.7	*
Smart Reward Express Limited	Hong Kong	42.6	*	38.3	*	Hong Kong		49.8	*		49.8	*
Partners HWH Pte. Ltd.	Singapore	-		76.8
AHR Texas Two LLC	United States of America	85.4		76.8		United States of America		100			85.4
AHR Black Oak One LLC	United States of America	85.4		76.8		United States of America		85.4			85.4
Hapi Air Inc.	United States of America	92.7		88.4		United States of America		92.7			92.7
AHR Texas Three, LLC	United States of America	85.4		76.8		United States of America		100			85.4
Alset Capital Pte. Ltd.	Singapore	100		100		Singapore		-			100
Hapi Cafe Korea, Inc.	Korea	85.6		100		Korea		85.4			85.4
Green Energy Inc.	United States of America	100		100
Green Energy REIT Inc.						United States of America		-			100
Green Energy Management Inc.	United States of America	100		100		United States of America		-			100
Alset Metaverse Inc.	United States of America	97.2		95.6		United States of America		97.2			97.2
Alset Management Group Inc.	United States of America	83.4		88.2		United States of America		83.4			83.4
Alset Acquisition Sponsor, LLC	United States of America	83.4		79.6		United States of America		93.4			93.4
Alset Capital Acquisition Corp.	United States of America	23.4		79.6
Alset Spac Group Inc.	United States of America	83.4		79.6		United States of America		93.4			93.4
Alset Mining Pte. Ltd.	Singapore	85.4		-		Singapore		85.4			85.4
Alset Inc.	United States of America	100		-
Hapi Travel Pte. Ltd.	Singapore	85.4		-		Singapore		85.4			85.4
Hapi WealthBuilder Pte. Ltd.	Singapore	85.4		-		Singapore		85.4			85.4
HWH Marketplace Pte. Ltd.	Singapore	85.4		-		Singapore		85.4			85.4
HWH International Inc. (Nevada)	United States of America	85.4		-		United States of America		85.4			85.4
Hapi Cafe SG Pte. Ltd.	Singapore	85.4		-		Singapore		85.4			85.4
Alset Reits Inc.						United States of America		100			100
Robotic gHome Inc.						United States of America		76.9			76.9
HWH Merger Sub, Inc.						United States of America		85.4			85.4
Alset Home REIT Inc.						United States of America		100			100
Hapi Metaverse Inc. (Texas)						United States of America		99.7			99.7
Hapi Café Limited						Hong Kong		99.7			99.7
MOC HK Limited						Hong Kong		99.7			99.7
AHR Texas Four, LLC						United States of America		100			100
Alset F&B (PLQ) Pte. Ltd.						Singapore		85.4			85.4
Hapi Café Sdn. Bhd.						Malaysia		51.3			-
Shenzhen Leyouyou Catering Management Co., Ltd.						China		100			100
Dongguan Leyouyou Catering Management Co., Ltd.						China		100			-
Guangzho Leyouyou Catering Management Co., Ltd.						China		100			-
Hapi Travel Ltd.						Hong Kong		100			-
Alset Capital Acquisition Corp.						United States of America		57.1			-

*	Although the Company indirectly holds percentage of shares of these entities less than 50%, the subsidiaries of the Company directly hold more than 50% of shares of these entities, and therefore, they are still consolidated into the Company.

~~F-8~~F-7

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates made by management include, but are not limited to, allowance for doubtful accounts, valuation of real estate assets, allocation of development costs and capitalized interest to sold lots, fair value of the investments, the valuation allowance of deferred taxes, and contingencies. Actual results could differ from those estimates.

In our property development business, land acquisition costs are allocated to each lot based on the area method, the size of the lot compared to the total size of all lots in the project. Development costs and capitalized interest are allocated to lots sold based on the total expected development and interest costs of the completed project and allocating a percentage of those costs based on the selling price of the sold lot compared to the expected sales values of all lots in the project.

If allocation of development costs and capitalized interest based on the projection and relative expected sales value is impracticable, those costs could also be allocated based on area method, the size of the lot compared to the total size of all lots in the project.

~~Transactions~~When the Company purchases properties but does not receive the assessment information from the county, the Company allocates the values between ~~Entities under Common Control~~land and building based on the data of similar properties. The Company makes appropriate adjustments once the assessment from the county is received. At the same time, any necessary adjustments to depreciation expense are made in the income statement. On June 30, 2023 and December 31, 2022, the Company adjusted $951,349 and $4,791,997 between building and land, respectively. During the three months ended June 30, 2023 and 2022, the Company adjusted depreciation expenses of $17,525 and $0, respectively. During the six months ended June 30, 2023 and 2022, the Company adjusted depreciation expenses of $17,525 and $0, respectively.

On March 12, 2021, the Company entered into a Securities Purchase Agreement (the “SPA”) with Chan Heng Fai, the founder, Chairman and Chief Executive Officer of the Company, for four proposed transactions, consisting of (i) purchase of certain warrants (the “Warrants”) to purchase ~~1,500,000,000~~ ~~shares of Alset International Limited, which was valued at $28,363,966; (ii) purchase of all of the issued and outstanding stock of LiquidValue Development Pte Ltd. (“LVD”), which was valued at $173,395; (iii) purchase of~~ ~~62,122,908~~ ~~ordinary shares in True Partner Capital Holding Limited (HKG: 8657) (“True Partner”), which was valued at $6,729,629; and (iv) purchase of~~ ~~4,775,523~~ ~~shares of the common stock of American Pacific Bancorp Inc. (“APB”), which was valued at $28,653,138. The total amount of above four transactions was $63,920,129~~, payable on the Closing Date by the Company, in the convertible promissory notes (“Alset CPNs”), which, subject to the terms and conditions of the Alset CPNs and the Company’s shareholder approval, shall be convertible into shares of the Company’s common stock (“AEI Common Stock”), par value $~~0.001~~ ~~per share, at the conversion price of AEI’s Stock Market Price. AEI’s Stock Market Price shall be $5.59~~ per share, equivalent to the average of the five closing per share prices of AEI’s Common Stock preceding January 4, 2021 as quoted by Bloomberg L.P. The above four acquisitions from Chan Heng Fai were transactions between entities under common control.

~~On October 15, 2020, American Pacific Bancorp (which subsequently became a majority-owned subsidiary of the Company) entered into an acquisition agreement to acquire~~ ~~3,500,001~~ ~~common shares of HengFeng Finance Limited (“HFL”), representing~~ ~~100% of the common shares of HFL, in consideration for $1,500,000, to be satisfied by the issuance and allotment of~~ ~~250,000~~ shares of the Class A Common Stock of American Pacific Bancorp. HFL is incorporated in Hong Kong with limited liability. The principal activities of HFL are money lending, securities trading and investment. This transaction closed on April 21, 2021. This transaction between the Company and Chan Heng Fai is under common control of Chan Heng Fai.

~~The common control transactions resulted in the following basis of accounting for the financial reporting periods:~~

	●	~~The acquisition of the Warrants and True Partner stock were accounted for prospectively as of March 12, 2021 and they did not represent a change in reporting entity.~~
	●	The acquisition of LVD, APB and HFL was under common control and was consolidated in accordance with ASC 850-50. The consolidated financial statements were retrospectively adjusted for the acquisition of LVD, APB and HFL, and the operating results of LVD, APB and HFL as of January 1, 2020 for comparative purposes.

~~AEI’s stock price was $10.03~~ ~~on March 12, 2021, the commitment date. The Beneficial Conversion Feature (“BCF”) intrinsic value was $50,770,192~~ for the four convertible promissory notes and was recorded as debt discount of convertible notes after these transactions. The debt discount attributable to the BCF is amortized over period from issuance to the date that the debt becomes convertible using the effective interest method. If the debt is converted, the discount is amortized to finance cost in full immediately. On May 13, 2021 and June 14, 2021 all Alset CPNs of $~~63,920,128~~ ~~and accrued interest of $306,438~~ ~~were converted into~~ ~~2,123~~ ~~shares of Series B preferred stock and~~ ~~9,163,965~~ ~~shares of common stock of the Company.~~

~~F-9~~

Cash and Cash Equivalents

The Company considers all highly liquid investments with a maturity of three months or less at the date of acquisition to be cash equivalents. Cash and cash equivalents include cash on hand and at the bank and short-term deposits with financial institutions that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in values. There were 0no cash equivalents as of June 30, ~~2022~~2023 and December 31, ~~2021.~~2022.

Restricted Cash

As a condition to the loan agreement with the Manufacturers and Traders Trust Company (“M&T Bank”), the Company was required to maintain a minimum of $2,600,000 in an interest-bearing account maintained by the lender as additional security for the loan. The funds were required to remain as collateral for the loan until the loan is paid off in full and the loan agreement terminated. On March 15, 2022 approximately $2,300,000 was released from collateral, leaving approximately $300,000 as collateral for outstanding letters of credit. The Company also has an escrow account with M&T Bank to deposit a portion of cash proceeds from lot sales. The funds in the escrow account were specifically to be used for the payment of the loan from M&T Bank. The funds were required to remain in the escrow account for the loan payment until the loan agreement terminates. In May 2022 the funds from this escrow account were released and the account closed. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the total balance of these two accounts was $~~309,137~~309,372 and $~~4,399,984~~309,219, respectively.

As a condition to the loan agreement with National Australian Bank Limited in conjunction with the Perth project, an Australian real estate development project, the Company iswas required to maintain Australian Dollar 50,000, in a non-interest-bearing account. As of ~~June 30, 2022 and~~ December 31, 2021, the account balance was $~~34,445~~36,316. In February 2022 the Company repaid the loan and $~~36,316, respectively. These~~the funds ~~will remain as collateral for the loans until paid in full.~~were subsequently released.

F-8

The Company puts money into brokerage accounts specifically for equity investment. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the cash balance in these brokerage accounts was $~~325,738~~354,802 and $~~304,570~~385,304, respectively.

Investments held in Trust Account

At June 30, 2023 the Company had approximately $20.8 million, in investments in treasury securities held in the Trust Account. The funds in the Trust Account are subject to redemption by investors of Alset Capital Acquisition Corp. (“SPAC”).

Account Receivables and Allowance for Doubtful Accounts

Account receivables is stated at amounts due from buyers, contractors, and all third parties, net of an allowance for doubtful accounts. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the balance of account receivables was $~~169,725~~63,778 and $~~39,622~~46,522, respectively. ~~Approximately $~~0 ~~and $2,500~~ of account receivables as of June 30, 2022 and December 31, 2021, respectively, was from DSS with a merchant agreement, under which the Company uses DSS credit card platform to collect money from our direct sales.

The Company monitors its account receivables balances on a monthly basis to ensure that they are collectible. On a quarterly basis, the Company uses its historical experience to estimate its allowance for doubtful account receivables. The Company’s allowance for doubtful accounts represents an estimate of the losses expected to be incurred based on specifically identified accounts as well as nonspecific amount, when determined appropriate. Generally, the amount of the allowance is primarily decided by division management’s historical experience, the delinquency trends, the resolution rates, the aging of receivables, the credit quality indicators and financial health of specific customers. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the allowance was $0.

Inventories

Inventories are stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out method and includes all costs in bringing the inventories to their present location and condition. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs necessary to make the sale. As of June 30, 2023 and December 31, ~~2021, inventory consisted of finished goods from HWH World Inc. As of June 30,~~ 2022, inventory consisted of finished goods from HWH ~~World~~International Inc. and ~~Hapi Cafe Korea Inc.~~its subsidiaries. The Company continuously evaluates the need for reserve for obsolescence and possible price concessions required to write-down inventories to net realizable value.

~~F-10~~

Investment Securities

Investment Securities at Fair Value

The Company records all equity investments with readily determinable fair values at fair value calculated by the publicly traded stock price at the close of the reporting period. Holista CollTech Limited (“Holista”), Amarantus BioScience Holdings, Inc. (“AMBS”) ~~and~~ True Partner Capital Holding Limited (“True Partner”) and Lucy Scientific Discovery Inc. (“Lucy”) are publicly traded companies. The Company does not have significant influence over Holista, AMBS, ~~and~~ True Partner and Lucy, as the Company is the beneficial owner of approximately 14.7% of common shares of Holista, 4.3% of the common shares of AMBS and ~~as of December 31, 2021 held~~less than ~~15.5~~0.1% of ~~True Partner. On May 17, 2022 the Company sold its investment in True Partner to DSS Inc. These securities’ fair values are determined by reference to quoted stock prices.~~

~~On April 12, 2021 the Company acquired~~ ~~6,500,000~~ common shares of ~~Value Exchange International, Inc. (“Value Exchange International”), an OTC listed company, for an aggregate subscription price of $650,000. After the transaction the Company owns approximately~~ 18~~% of Value Exchange International and does not have significant influence on it.~~True Partner. The stock’s fair value is determined by ~~reference to~~ quoted stock prices. The Company disposed the shares of Lucy in the first six months of 2023.

~~During the year ended December 31,~~Since 2021, the Company’s subsidiaries ~~established~~have maintained a portfolio of trading securities. The objective is to generate profits on short-term differences in market prices. The Company does not have significant influence over any trading securities in our portfolio and fair value of these trading securities are determined by reference to quoted stock prices.

F-9

The Company has elected the fair value option for the equity securities noted below that would otherwise be accounted for under the equity method of accounting. ~~Holista CollTech Limited (“Holista”),~~ DSS, Inc. (“DSS”) ~~and American Premium Mining~~, New Electric CV Corporation (“~~APM”~~NECV” formerly known as ~~American~~“American Premium ~~Water~~Mining Corporation” (“APM”)), Value Exchange International Inc. (“Value Exchange International” or “VEII”) and Sharing Services Global Corp. (“SHRG”) are publicly traded companies and ~~the~~ fair value ~~of such securities are~~is determined by ~~reference to~~ quoted stock prices. The Company has significant influence but does not have a controlling interest in these investments, and therefore, the Company’s investment could be accounted for under the equity method of accounting or elect fair value accounting.

	●	The Company has significant influence over DSS. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the Company owned approximately ~~45.18~~44.8~~% and~~ ~~24.9~~% of the common stock of DSS, respectively. Our CEO is a stockholder and the Chairman of the Board of Directors of DSS. Chan Tung Moe, our Co-Chief Executive Officer and the son of Chan Heng Fai, is also a director of DSS. William Wu, ~~one of~~Wong Shui Yeung and Joanne Wong Hiu Pan, directors of the Company, isare each also ~~a director~~directors of DSS.

	●	The Company has significant influence over ~~Holista~~NECV as the Company ~~and its CEO are~~is the beneficial owner of approximately ~~15.8~~0.5% of the ~~outstanding~~common shares of ~~Holista~~NECV and ~~our CEO~~one officer from the Company held a director position on ~~Holista’s~~NECV’s Board of Directors until ~~June~~April of ~~2021.~~2023. Additionally, our CEO is a significant stockholder of NECV shares.

	●	The Company has significant influence over ~~APM~~Value Exchange International as the Company is the beneficial owner of approximately ~~0.8~~38.3% of the common shares of ~~APM~~VEII. Mr. Chan and ~~one officer from~~another member of the Board of Directors of Hapi Metaverse, Lum Kan Fai Vincent, are both members of the Board of Directors of VEII. In addition to Mr. Chan, two other members of the Board of Directors of Alset Inc. are also members of the Board of Directors of VEII (Mr. Wong Shui Yeung and Mr. Wong Tat Keung).

	●	The Company has significant influence over SHRG as the Company is the beneficial owner of approximately 33.4% of the common shares of SHRG, our CEO holds a director position on ~~APM’s~~SHRG’s Board of ~~Directors.~~Directors and one of the officers of the Company is the CFO of SHRG. Additionally, our CEO is a significant stockholder of SHRG shares.

On March 2, 2020 and October 29, 2021, the Company received warrants to purchase shares of American Medical REIT Inc. (“AMRE”), a related party private company, in conjunction with the Company lending two ~~$200,000~~$200,000 promissory notes. For further details on this transaction, refer to Note 8 - Related Party Transactions, Note Receivable from a Related Party Company. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, AMRE was a private company. Based on management’s analysis, the fair value of the AMRE warrants was $0 as of December 31, 2021. In March 2022 both loans, together with warrants were converted into common shares of AMRE. After the conversion, the Company owns approximately 15.8% of AMRE.

~~The Company held a stock option to purchase~~ ~~250,000~~ ~~shares of Vivacitas common stock at $~~1 per share at any time prior to the date of a public offering by Vivacitas. As of December 31, 2020, Vivacitas was a private company. Based on management’s analysis, the fair value of the Vivacitas stock option was $0 as of December 31, 2020. On March 18, 2021 the Company sold the subsidiary holding the ownership and stock option in Vivacitas to an indirect subsidiary of DSS. For further details on this transaction, refer to Note 8 - Related Party Transactions, ~~Sale of Investment in Vivacitas to DSS~~.

~~F-11~~

The Company accounts for certain of its investments in funds without readily determinable fair values in accordance with ASU No. 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) (“2015-07”). In the first six months of 2022 the Company invested $$100,000 in Class A Shares of Novum Alpha Global Opportunity Digital Asset Fund I SP, a segregated portfolio of Novum Alpha SPC (“Novum Alpha Fund”). This fund invests in long-short digital assets. The Company subscribed in participating shares which are redeemable and non-voting. The Company closed the fund in July 2022 recording $74,827 loss on this investment.

Investment Securities at Cost

Investments in equity securities without readily determinable fair values are measured at cost minus impairment adjusted by observable price changes in orderly transactions for the identical or a similar investment of the same issuer. These investments are measured at fair value on a nonrecurring basis when there are events or changes in circumstances that may have a significant adverse effect. An impairment loss is recognized in the condensed consolidated statements of comprehensive income equal to the amount by which the carrying value exceeds the fair value of the investment.

The Company had an equity holding in Vivacitas Oncology Inc. (“Vivacitas”), a private company that is currently not listed on an exchange. We measured Vivacitas at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer. Our ownership in Vivacitas was sold on March 18, 2021 to DSS for $~~2,480,000. The difference of $2,279,872~~ between the selling price and our original investment cost was recorded as additional paid capital considering a related party transaction. For further details on this transaction, refer to Note 8 – Related Party Transactions, ~~Sale of Investment in Vivacitas to DSS~~.

On September 8, 2020, the Company acquired 1,666 shares, approximately 1.45% ownership, from Nervotec Pte Ltd (“Nervotec”), a private company, at the purchase price of $37,826. The Company applied ASC 321 and measured Nervotec at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.

On September 30, 2020, the Company acquired 3,800 shares, representing the ownership of approximately 19% ~~ownership,~~, from HWH World Company Limited (f.k.a. Hyten Global (Thailand) Co., Ltd.) (“HWH World Co.”), a private company, at a purchase price of $42,562.

F-10

During 2021, the Company invested $19,609 in K Beauty Research Lab Co., Ltd (“K Beauty”) for 18% ~~ownership.~~of such company. K Beauty was established for sourcing, developing and producing variety of Korea-made beauty products as well as Korea - originated beauty contents for the purpose of distribution to HWH’s membership distribution channel.

There has been no indication of impairment or changes in observable prices via transactions of similar securities and investments are still carried at cost.

Equity Method Investment

The Company accounts for equity investment in entities with significant influence under equity-method accounting. Under this method, the Group’s pro rata share of income (loss) from investment is recognized in the condensed consolidated statements of comprehensive income. Dividends received reduce the carrying amount of the investment. When the Company’s share of loss in an equity-method investee equals or exceeds its carrying value of the investment in that entity, the equity method investment can be reduced below zero based on losses, if the Company either is liable for the obligations of the investee or provides for losses in excess of the investment when imminent return to profitable operations by the investee appears to be assured. Otherwise, the Company does not recognize its share of equity method losses exceeding its carrying amount of the investment, but discloses the losses in the footnotes. Equity-method investment is reviewed for impairment by assessing if the decline in market value of the investment below the carrying value is other-than-temporary. In making this determination, factors are evaluated in determining whether a loss in value should be recognized. These include consideration of the intent and ability of the Group to hold investment and the ability of the investee to sustain an earnings capacity, justifying the carrying amount of the investment. Impairment losses are recognized in other expense when a decline in value is deemed to be other-than-temporary.

~~F-12~~

American Medical REIT Inc.

LiquidValue Asset Management Pte. Ltd. (“LiquidValue”), a subsidiary of the Company, owns 15.8% of American Medical REIT Inc. (“AMRE”) as of June 30, ~~2022,~~2023, a company concentrating on medical real estate. AMRE acquires state-of-the-art, purpose-built healthcare facilities and leases them to leading clinical operators with dominant market share under secure triple net leases. AMRE targets hospitals (both Critical Access and Specialty Surgical), Physician Group Practices, Ambulatory Surgical Centers, and other licensed medical treatment facilities. Chan Heng Fai, our Chairman and CEO, is the executive chairman and director of AMRE. DSS, of which we own ~~45.2%~~44.8% and have significant influence over, owns ~~80.8%~~80.8% of AMRE. Therefore, the Company has significant influence on AMRE.

~~Joint Venture with Novum~~

On April 20, 2021, one of Company’s indirect subsidiaries, SeD Capital Pte. Ltd. (“SeD Capital”), entered into joint venture agreement with a digital asset management firm Novum Alpha Pte Ltd (“Novum”). Pursuant to this agreement, SeD Capital will own 50~~% of the issued and paid-up capital in the joint venture company, Credas Capital Pte. Ltd. (“Credas”) with the remaining~~ 50% shareholding stake held by Novum. On the condensed consolidated balance sheet, the prorate loss from Credas was not recorded as a liability because the Company is not liable for the obligations of Credas and has not committed to provide additional financial support.

American Pacific Bancorp, Inc.

Pursuant to Securities Purchase Agreement from March 12, 2021 the Company purchased of 4,775,523 shares of the common stock of American Pacific Bancorp Inc. (“APB”) and gained majority ownership in that entity. APB was consolidated into the Company under common control accounting (See Transactions between Entities under Common Control for details). On September 8, 2021 APB sold 6,666,700 shares of Series A Common Stock to DSS, Inc. for $40,000,200 cash. As a result of the new share issuances, the Company’s ownership percentage of APB fell below 50% to 41.3%, and subsequently to 36.9% and the entity was deconsolidated in accordance with ASC 810-10. Upon deconsolidation the Company elected to apply the equity method accounting as the Company still retained significant influence. As a result of the deconsolidation, the Company recognized gain of approximately $28.2 million. The gain represents the difference between the fair value of retained equity method investment of $30.8 million and $~~2.6~~ ~~million,~~ the ~~Company’s~~ investment percentage of carrying amount of APB’s net assets of $2.9 million. Considering the transaction was between related parties, the Company recorded the gain as additional paid in capital in its equity. ~~From September 8 to December 31, 2021,~~During three and six months ended June 30, 2023 the investment ~~loss~~gain was $~~51,999~~136,751~~. During~~ and $119,002, respectively, and during three and six months ended June 30, 2022 the investment gain was $18,678 and $160,021, respectively. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the investment in APB was $~~30,961,150~~31,787,248 and $~~30,801,129~~31,668,246, respectively.

F-11

~~Alset Capital Acquisition Corp.~~

On February 3, 2022, Alset Capital Acquisition Corp. (“Alset Capital”), a special purpose acquisition company (SPAC) sponsored by the Company and certain affiliates, closed its initial public offering of ~~7,500,000~~ ~~units at $10.00~~ ~~per unit (the “Offering”). At the same time the exercise of underwriters’ over-allotment option of additional~~ ~~1,125,000~~ ~~units closed. The Company is majority owner of Alset Acquisition Sponsor, LLC, the sponsor (the “Sponsor”) of Alset Capital. On February 3, 2022, the Sponsor purchased~~ ~~473,750~~ ~~units pursuant to a private placement for a purchase price of $4,737,500. Previously, the Sponsor had purchased~~ ~~2,156,250~~ ~~shares of Class B common stock pursuant to a private placement for a purchase price of $25,000. After the Offering the Company holds~~ ~~23.4% of Alset Capital. Chan Heng Fai, the Chairman and CEO of the Company, is the CEO and director of Alset Capital.~~ ~~In June 2022, the Company made an adjustment of $2,830,961~~ ~~to Additional Paid in Capital and the fair value of investment in Alset Capital, and reversed the previously recorded unrealized loss of $237,578~~, because of the change of valuation methods of the investment on Class B Common Stock and units the company held. Initially, the Company used market trading prices of Class A common stock and units to calculate the fair value of these investment securities and recorded $~~237,578~~ unrealized loss on security investment during three months ended March 31, 2022. In June 2022, the Company determined the fair value of Class B common shares and units by using a put option model and a Monte Carlo simulation considering some restrictions and risks related to these securities the Company held. During the six months ended June 30, 2022, the Company recorded investment loss of $~~32,427~~ ~~by equity method. Investment on Alset Capital was $20,806,612~~ ~~as of June 30, 2022.~~

~~F-13~~

Ketomei Pte Ltd

On June 10, 2021 the Company’s indirect subsidiary Hapi Cafe Inc. (“Hapi Cafe”) lent $76,723 to Ketomei Pte Ltd (“Ketomei”). On March 21, 2022 Hapi Cafe entered into an agreement pursuant to which the principal of the loan together with accrued interest were converted into an investment in Ketomei. At the same time, Hapi Cafe invested an additional $179,595 in Ketomei. After the conversion and fund investment the Company now holds 28% of Ketomei. Ketomei is in the business of selling cooked food and drinks. During three and six months ended June 30, 2023 and 2022 the investment loss was $10,446 and $63,645, and $29,786 and $33,059, respectively. Investment in Ketomei was $~~223,259~~143,757 and $207,402 at June 30, ~~2022.~~2023 and December 31, 2022, respectively.

Sentinel Brokers Company Inc.

On May 22, 2023 the Company’s indirect subsidiary, SeD Capital Pte Ltd (“SeD Capital”), entered into a Stock Purchase Agreement, pursuant to which SeD Capital purchased 39.8 shares (19.9%) of the Common Stock of Sentinel Brokers Company Inc. (“Sentinel”) for the aggregate purchase price of $279,719. Sentinel is a broker-dealer operating primarily as a fiduciary intermediary, facilitating institutional trading of municipal and corporate bonds as well as preferred stock, and is registered with the Securities and Exchange Commission, is a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”), and is a member of the Securities Investor Protection Corporation (“SIPC”). The Company has significant influence over Sentinel as its CEO holds a director position on Sentinel’s Board of Directors. Additionally, DSS, of which we own 44.8% and have significant influence over, owns 80.1% of Sentinel. During three and six months ended June 30, 2023 the investment loss in Sentinel was $7,990 and $7,990, respectively. Investment in Sentinel was $271,729 at June 30, 2023.

Investment in Debt Securities

Debt securities are reported at fair value, with unrealized gains and losses (other than impairment losses) recognized in accumulated other comprehensive income or loss. Realized gains and losses on debt securities are recognized in the net income in the condensed consolidated statements of comprehensive income. The Company monitors its investments for other-than-temporary impairment by considering factors including, but not limited to, current economic and market conditions, the operating performance of the companies including current earnings trends and other company-specific information.

The Company invested $50,000 in a convertible promissory note of Sharing Services Global Corporation (“~~Sharing Services~~SHRG Convertible Note”), a company quoted on the US OTC market. The value of the convertible note iswas estimated by management using a Black-Scholes valuation model. The fair value of the note was $859,799 on December 31, 2021. The note was redeemed on July 14, 2022 and $~~9,799~~50,000 ~~on June 30, 2022 and December 31, 2021, respectively.~~principal together with $28,636 accrued interests were received from Sharing Services.

On February 26, 2021, the Company invested approximately $88,599 in the convertible note of Vector Com Co., Ltd (“Vector Com”), a private company in South Korea. The interest rate is 2% per annum and maturity istwo years. The conversion price is approximately $21.26 per common share of Vector Com. As of June 30, 2023 and December 31, 2022, ~~the Management~~our management estimated the fair value of the note to be $88,599, the initial transaction price.

Variable Interest Entity

Under Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) 810, Consolidation, when a reporting entity is the primary beneficiary of an entity that is a variable interest entity (“VIE”), as defined in ASC 810, the VIE must be consolidated into the financial statements of the reporting entity. The determination of which owner is the primary beneficiary of a VIE requires management to make significant estimates and judgments about the rights, obligations, and economic interests of each interest holder in the VIE.

The Company evaluates its interests in VIEs on an ongoing basis and consolidates any VIE in which it has a controlling financial interest and is deemed to be the primary beneficiary. A controlling financial interest has both of the following characteristics: (i) the power to direct the activities of the VIE that most significantly impact its economic performance; and (ii) the obligation to absorb losses of the VIE that could potentially be significant to it or the right to receive benefits from the VIE that could be significant to the VIE.

~~HWH World Company Limited~~

~~HWH World Co. is a direct sales company in Thailand. The Company has a~~ 19~~% ownership and loaned $187,500~~ with zero interest and due on demand, to HWH World Co. The current level of equity in HWH World Co. is not sufficient to determine if HWH World Co. can operate on its own without additional subordinated financial support. The Company has a variable interest in HWH World Co., however, the Company is not deemed to absorb losses or receive benefits that could potentially be significant to HWH World Co. Ltd. The Company does not also have the ultimate power over the activities which can impact VIE’s economic performance, like developing company budgets or overseeing and controlling the management. The power to direct the activities are held by the manager in Thailand who owns 51% of the HWH World Co. Therefore, the Company is not a primary beneficiary of this VIE and does not consolidate it. On June 30, 2022 and December 31, 2021 variable interest and amount receivable in the non-consolidated VIE was $~~236,699~~ ~~and $236,699~~, respectively, which represents the Company’s maximum risk of loss from non-consolidated VIE. The Company applied ASC 321 and measured HWH World Co. investment at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.

~~F-14~~F-12

~~American Medical REIT Inc.~~

~~The Company owned~~ ~~3.4% of AMRE and made a loan in the amount of $8,350,000~~ ~~to AMRE, as well as two loans of $200,000~~ ~~each, all with~~ 8~~% per annum interest rate. One of the $200,000~~ ~~loans was due on March 3, 2022, the other one is due on October 29, 2024. The $8,350,000~~ loan is due on November 29, 2023. The Company has a variable interest in AMRE. However, the Company is not deemed to absorb losses or receive benefits that could potentially be significant to AMRE. The Company does not also have the ultimate power over the activities which can impact VIE’s economic performance, like developing company budgets or overseeing and controlling the management. The power to direct these activities are held by the AMRE’s largest shareholder which owns approximately ~~80.8% of AMRE and AMRE’s management team. Therefore, the Company is not a primary beneficiary of this VIE and does not consolidate it. In March 2022, the Company converted both $200,000~~ ~~loans and accrued interests, together with accompanying warrants into AMRE common shares. After the conversion the Company owns~~ ~~15.8% of AMRE. On~~ ~~June 30, 2022 and~~ ~~December 31, 2021 variable interest and amount receivable in the non-consolidated VIE was $8,802,959~~ ~~and $8,901,285, respectively, which represents the Company’s maximum risk of loss from non-consolidated VIE.~~

Real Estate Assets

Real estate assets are recorded at cost, except when real estate assets are acquired that meet the definition of a business combination in accordance with Financial Accounting Standards Board (“FASB”) ASC 805 - “Business Combinations”, which acquired assets are recorded at fair value. Interest, property taxes, insurance and other incremental costs (including salaries) directly related to a project are capitalized during the construction period of major facilities and land improvements. The capitalization period begins when activities to develop the parcel commence and ends when the asset constructed is completed. The capitalized costs are recorded as part of the asset to which they relate and are reduced when lots are sold.

The Company capitalized construction costs of approximately $~~2.6~~6.3 million and $~~0.2~~2.6 million for the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. The Company capitalized construction costs of approximately $38.8 million and $~~1.4~~3 million for the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively.

The Company’s policy is to obtain an independent third-party valuation for each major project in the United States as part of our assessment of identifying potential triggering events for impairment. Management may use the market comparison method to value other relatively small projects, such as the project in Perth, ~~Australia.~~Australia, which was completed during the year 2022. In addition to the annual assessment of potential triggering events in accordance with ASC 360 – Property Plant and Equipment (“ASC 360”), the Company applies a fair value-based impairment test to the net book value assets on an annual basis and on an interim basis if certain events or circumstances indicate that an impairment loss may have occurred.

F-13

The Company did not record impairment on any of its projects during the three and six months ended on June 30, 2023 and 2022.

Recent Agreements to Sell Lots

On October 28, 2022, 150 CCM Black Oak Ltd. (the “Seller”), a Texas Limited Partnership and ~~2021.~~subsidiary of the Company, entered into a Contract for Purchase and Sale and Escrow Instructions (the “Agreement”) with Century Land Holdings of Texas, LLC, a Colorado limited liability company (the “Buyer”). Pursuant to the terms of the Agreement, the Seller agreed to sell approximately 242 single-family detached residential lots comprising a residential community in the city of Magnolia, Texas known as the “Lakes at Black Oak.” On November 28, 2022, the parties to the Agreement entered into an amendment to the Agreement (the “Amendment”). Pursuant to the Amendment, the parties agreed that the Buyer would purchase approximately 131 single-family detached residential lots, instead of 242 lots. This transaction closed on April 13, 2023.

On March 16, 2023, 150 CCM Black Oak Ltd. (the “Seller”) entered into a Purchase and Sale Agreement (the “Purchase and Sale Agreement”) with Rausch Coleman Homes Houston, LLC, a Texas limited liability company (“Rausch Coleman”). Pursuant to the terms of the Purchase and Sale Agreement, the Seller has agreed to sell approximately 110 single-family detached residential lots which comprise a section of the Lakes at Black Oak. The transaction closed on May 15, 2023.

On March 17, 2023, 150 CCM Black Oak Ltd. (the “Seller”) entered into a Purchase and Sale Agreement (the “Purchase and Sale Agreement”) with Davidson Homes, LLC, an Alabama limited liability company (“Davidson”). Pursuant to the terms of the Purchase and Sale Agreement, the Seller has agreed to sell approximately 189 single-family detached residential lots developed within section 2 of Black Oak project. The sale of the first 94 lots closed on May 30, 2023. The sale of remaining lots is estimated to close at the end of the year 2023.

Properties under development

Properties under development are properties being constructed for sale in the ordinary course of business, rather than to be held for the Company’s own use, rental or capital appreciation.

Rental Properties

Rental properties are acquired with the intent to be rented to tenants. ~~During the six months ended~~As of June 30, 2022 and ~~the year ended~~ December 31, ~~2021,~~2022, the Company ~~signed multiple purchase agreements to acquire 3 and 109 homes, respectively. By June 30, 2022, all of the 112 homes were closed with an~~owned 132 homes. The aggregate purchase cost of all the homes is $~~25,663,582~~30,998,258. These homes are located in Montgomery and Harris Counties, Texas. All of these purchased homes are properties of our rental business.

~~F-15~~

Investments in Single-Family Residential Properties

The Company accounts for its investments in single-family residential properties as asset acquisitions and records these acquisitions at their purchase price. The purchase price is allocated between land, building, improvements and existing leases based upon their relative fair values at the date of acquisition. The purchase price for purposes of this allocation is inclusive of acquisition costs which typically include legal fees, title fees, property inspection and valuation fees, as well as other closing costs.

Building improvements and buildings are depreciated over estimated useful lives of approximately 10 to 27.5 years, respectively, using the straight-line method.

The Company assesses its investments in single-family residential properties for impairment whenever events or changes in business circumstances indicate that carrying amounts of the assets may not be fully recoverable. When such events occur, management determines whether there has been impairment by comparing the asset’s carrying value with its fair value. Should impairment exist, the asset is written down to its estimated fair value. The Company did not recognize any impairment losses during three and six months ended June 30, ~~2022~~2023 and ~~2021.~~2022.

F-14

Revenue Recognition and Cost of Revenue

ASC 606 - Revenue from Contracts with Customers (“ASC 606”), establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. The Company adopted this new standard on January 1, 2018 under the modified retrospective method. The adoption of this new standard did not have a material effect on our financial statements.

In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these goods or services. The provisions of ASC 606 include a five-step process by which the determination of revenue recognition, depicting the transfer of goods or services to customers in amounts reflecting the payment to which the Company expects to be entitled in exchange for those goods or services. ASC 606 requires the Company to apply the following steps:

(1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, performance obligations are satisfied.

The following represents the Company’s revenue recognition policies by Segments:

Real Estate

Property Sales

The Company’s main business is land development. The Company purchases land and develops it for building into residential communities. The developed lots are sold to builders (customers) for the construction of new homes. The builders enter into sales contracts with the Company before they take the lots. The prices and timeline are determined and agreed upon in the contracts. The builders do the inspections to make sure all conditions and requirements in contracts are met before purchasing the lots. A detailed breakdown of the five-step process for the revenue recognition of the Ballenger project and Black Oak project, which represented approximately 420% and 7042%, for Ballenger and 91% and 0% for Black Oak, respectively, of the Company’s revenue in the six months ended on June 30, ~~2022~~2023 and ~~2021,~~2022, is as follows:

●

Identify the contract with a customer.

The Company has signed agreements with the builders for developing the raw land to ready to build lots. The contract has agreed upon prices, timelines, and specifications for what is to be provided.

●

Identify the performance obligations in the contract.

Performance obligations of the Company include delivering developed lots to the customer, which are required to meet certain specifications that are outlined in the contract. The customer inspects all lots prior to accepting title to ensure all specifications are met.

~~F-16~~

●

Determine the transaction price.

The transaction price per lot is fixed and specified in the contract. Any subsequent change orders or price changes are required to be approved by both parties.

●

Allocate the transaction price to performance obligations in the contract.

Each lot or a group of lots is considered to be a separate performance obligation, for which the specified price in the contract is allocated to.

●

Recognize revenue when (or as) the entity satisfies a performance obligation.

F-15

The builders do the inspections to make sure all conditions/requirements are met before taking title of lots. The Company recognizes revenue at a point in time when title is transferred. The Company does not have further performance obligations or continuing involvement once title is transferred.

Rental Revenue

The Company leases real estate properties to its tenants under leases that are predominately classified as operating leases, in accordance with ASC 842, Leases (“ASC 842”). Real estate rental revenue is comprised of minimum base rent and revenue from the collection of lease termination fees.

Rent from tenants is recorded in accordance with the terms of each lease agreement on a straight-line basis over the initial term of the lease. Rental revenue recognition begins when the tenant controls the space and continues through the term of the related lease. Generally, at the end of the lease term, the Company provides the tenant with a ~~one year~~one-year renewal option, including mostly the same terms and conditions provided under the initial lease term, subject to rent increases.

The Company defers rental revenue related to lease payments received from tenants in advance of their due dates. These amounts are presented within deferred revenues and other payables on the Company’s condensed consolidated balance sheets.

Rental revenue is subject to an evaluation for collectability on several factors, including payment history, the financial strength of the tenant and any guarantors, historical operations and operating trends of the property, and current economic conditions. If our evaluation of these factors indicates that it is not probable that we will recover substantially all of the receivable, rental revenue is limited to the lesser of the rental revenue that would be recognized on a straight-line basis (as applicable) or the lease payments that have been collected from the lessee. Differences between rental revenue recognized and amounts contractually due under the lease agreements are credited or charged to straight-line rent receivable or straight-line rent liability, as applicable. For the three and six months ended June 30, ~~2022,~~2023, the Company did not recognize any deferred revenue and collected all rents due.

Sale of the Front Foot Benefit Assessments

We have established a front foot benefit (“FFB”) assessment on all of the NVR lots. This is a 30-year annual assessment allowed in Frederick County which requires homeowners to reimburse the developer for the costs of installing public water and sewer to the lots. These assessments become effective as homes are settled, at which time we can sell the collection rights to investors who will pay an upfront lump sum, enabling us to more quickly realize the revenue. The selling prices range from $3,000to $4,500 per home depending the type of the home. Our total revenue from the front foot benefit assessment is approximately $1$1 million. To recognize revenue of the FFB assessment, both our and NVR’s performance obligation have to be satisfied. Our performance obligation is completed once we complete the construction of water and sewer facility and close the lot sales with NVR, which inspects these water and sewer facility prior to close lot sales to ensure all specifications are met. NVR’s performance obligation is to sell homes they build to homeowners. Our FFB revenue is recognized on quarterly basis after NVR closes sales of homes to homeowners. The agreement with these FFB investors is not subject to amendment by regulatory agencies and thus our revenue from the FFB assessment is not either. During the three months ended on June 30, ~~2022~~2023 and ~~2021,~~2022, we recognized revenue of $~~37,725~~0 and $~~141,575~~37,725 from the FFB assessments, respectively. During the six months ended on June 30, ~~2022~~2023 and ~~2021,~~2022, we recognized revenue of $~~116,088~~0 and $~~248,646~~116,088 from the FFB assessments, respectively.

~~F-17~~

Cost of Revenues

Real Estate

●

Cost of Real Estate Sale

All of the costs of real estate sales are from our land development business. Land acquisition costs are allocated to each lot based on the area method, the size of the lot comparing to the total size of all lots in the project. Development costs and capitalized interest are allocated to lots sold based on the total expected development and interest costs of the completed project and allocating a percentage of those costs based on the selling price of the sold lot compared to the expected sales values of all lots in the project.

F-16

●

Cost of Rental Revenue

Cost of rental revenue consists primarily of the costs associated with management and leasing fees to our management company, repairs and maintenance, depreciation and other related administrative costs. Utility expenses are paid directly by tenants.

Biohealth

●

Product Direct Sales

The Company’s net sales consist of product sales. The Company’s performance obligation is to transfer ownership of its products to its ~~third-party independent distributors (“Distributors”).~~members. The Company generally recognizes revenue when product is ~~shipped~~delivered to its ~~Distributors.~~

~~The Company’s Distributors may receive distributor~~members. Revenue is recorded net of applicable taxes, allowances, which are comprised of discounts, rebates and wholesale commission payments from the Company. Distributor allowances resulting from the Company’s sales of its products to its Distributors are recorded against net sales because the distributor allowances represent discounts from the suggested retail price.

In addition to distributor allowances, the Company compensates its sales leader Distributors with leadership incentives for services rendered, relating to the development, retention, and management of their sales organizations. Leadership incentives are payable based on achieved sales volume, which are recorded in general and administrative expenses. The Company recognizes revenue when it ships products.refund or returns. The Company receives the net sales price in cash or through credit card payments at the point of sale.

If ~~a Distributor~~any member returns a product to the Company on a timely basis, ~~he/she~~they may obtain a replacement product from the Company for such returned products. ~~In addition,~~We do not have buyback program. However, when the ~~Company maintains~~customer requests a ~~buyback program pursuant to which it will repurchase products sold to~~return and management decides that the refund is necessary, we initiate the refund after deducting all the benefits that a ~~Distributor who~~member has ~~decided to leave the business.~~earned. The returns are deducted from our sales revenue on our financial statements. Allowances for product and membership returns ~~primarily in connection with the Company’s buyback program,~~ are provided at the time the sale is recorded. This accrual is based upon historical return rates for each country and the relevant return pattern, which reflects anticipated returns to be received over a period of up to 12 months following the original sale. Product and membership returns for the three months ended June 30, 2023 and 2022 were approximately $0 and $15,412, respectively. Product and membership returns for the six months ended June 30, 2023 and 2022 were approximately $1,143 and $50,940, respectively.

●

Annual Membership

The Company collects an annual membership fee from its ~~Distributors.~~members. The fee is fixed, paid in full at the time ofupon joining the ~~membership and non-refundable.~~membership; the fee is not refundable. The ~~membership provides~~Company’s performance obligation is to provide its members the ~~member access~~right to (a) purchase products ~~at a discount,~~from the Company, (b) access to certain back-office services, (c) receive commissions ~~for signing up new members,~~ and (d) attend corporate events. The ~~Company recognizes revenue~~ associated ~~with~~performance obligation is satisfied over time, generally over the term of the membership ~~over the period of the membership.~~agreement which is for a one-year period. Before the membership fee is recognized as revenue, it is recorded as deferred revenue. Deferred revenue relating to membership was $~~89,880~~0 and $~~728,343~~21,198 at June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively. ~~During 2021,~~Starting in 2020 the ~~Company temporarily suspended the~~revenue from sale of ~~its~~ membership ~~as it~~declined to $0 in 2022. The Company is ~~focusing~~currently working on ~~developing~~a new ~~market strategy.~~membership model.

~~F-18~~

Other Businesses

●

~~Killiney Koptiam’s Franchise~~Food and Beverage

The Company, through Alset F&B One Pte. Ltd. (“Alset F~~&B”~~&B One”), and Alset F&B (PLQ) Pte. Ltd. (“Alset F&B PLQ”) each acquired a restaurant franchise ~~license~~licenses at the end of 2021 and ~~has~~2022 respectively, both of which have since commenced operations. ~~This license~~These licenses will allow Alset F&B One and Alset F&B PLQ each to operate a Killiney Kopitiam restaurant in Singapore. Killiney Kopitiam, founded in 1919, is a Singapore-based chain of mass-market, traditional kopitiam style service cafes selling ~~toast products, soft-boiled eggs~~traditional coffee and ~~coffee.~~tea, along with a range of local delicacies such as Curry Chicken, Laksa, Mee Siam, and Mee Rebus.

The Company, through Hapi Café Inc. (“HCI-T”), commenced operation of two cafés during 2022 and 2021, which are located in Singapore and South Korea.

F-17

The cafes are operated by subsidiaries of HCI-T, namely Hapi Café SG Pte. Limited (“HCSG”) in Singapore and Hapi Café Korea Inc. (“HCKI”) in Seoul, South Korea. Hapi Cafes are distinctive lifestyle café outlets that strive to revolutionize the way individuals dine, work, and live, by providing a conducive environment for everyone to relish the four facets – health and wellness, fitness, productivity, and recreation all under one roof.

In recent months the Company incorporated two new subsidiaries Shenzhen Leyouyou Catering Management Co., Ltd. and Dongguan Leyouyou Catering Management Co., Ltd. in the People’s Republic of China. Both companies will be principally engaged in the food and beverage business in Mainland China.

Additionally, through its subsidiary MOC HK Limited, the Company is focusing on operating café business in Hong Kong.

●

Remaining performance obligations

As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, there were no remaining performance obligations or continuing involvement, as all service obligations within the other business activities segment have been completed.

Stock-Based Compensation

The Company accounts for stock-based compensation to employees in accordance with ASC 718, “Compensation-Stock Compensation”. ASC 718 requires companies to measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the grant date fair value of the award and to recognize it as compensation expense over the period the employee is required to provide service in exchange for the award, usually the vesting period. Stock option forfeitures are recognized at the date of employee termination. Effective January 1, 2019, the Company adopted ASU 2018-07 for the accounting of share-based payments granted to non-employees for goods and services. During the three and six months ended on June 30, ~~2022~~2023 and ~~2021,~~2022, the Company recorded $0 ~~and $73,292~~ as stock-based compensation expense.

Foreign currency

Functional and reporting currency

Items included in the financial statements of each entity in the Company are measured using the currency of the primary economic environment in which the entity operates (“functional currency”). The financial statements of the Company are presented in U.S. dollars (the “reporting currency”).

The functional and reporting currency of the Company is the United States dollar (“U.S. dollar”). The financial records of the Company’s subsidiaries located in Singapore, Hong Kong, Australia and South Korea are maintained in their local currencies, the Singapore Dollar (S$), Hong Kong Dollar (HK$), Australian Dollar (“AUD”) ~~and~~, South Korean Won (“KRW”) and Chinese Yuan (CN¥), which are also the functional currencies of these entities.

Transactions in foreign currencies

Transactions in currencies other than the functional currency during the periods are converted into functional currency at the applicable rates of exchange prevailing when the transactions occurred. Transaction gains and losses are recognized in the statement of operations.

The majority of the Company’s foreign currency transaction gains or losses come from the effects of foreign exchange rate changes on the intercompany loans between Singapore entities and U.S. entities. The Company recorded foreign exchange gain of $~~2,077,709~~1,150,830 and $~~958,334~~2,077,709 during the three months ended on June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. The Company recorded foreign exchange gain of $~~2,485,804~~362,528 and $~~2,421,031~~2,485,804 during the six months ended on June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. The foreign currency transactional gains and losses are recorded in operations.

~~F-19~~F-18

Translation of consolidated entities’ financial statements

Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at the rates of exchange ruling at the balance sheet date. The Company’s entities with functional currency of S$, HK$, AUD, KRW and ~~KRW,~~CN¥, translate their operating results and financial positions into the U.S. dollar, the Company’s reporting currency. Assets and liabilities are translated using the exchange rates in effect on the balance sheet date. Revenue, expense, gains and losses are translated using the average rate for the year. Translation adjustments are reported as cumulative translation adjustments and are shown as a separate component of comprehensive income (loss).

The Company recorded other comprehensive loss of $~~3,514,595~~2,183,883 from foreign currency translation for the three months ended June 30, ~~2022~~2023 and $~~1,070,191~~3,514,595 loss for the three months ended June 30, ~~2021,~~2022, in accumulated other comprehensive loss. The Company recorded other comprehensive loss of $~~4,163,735~~1,087,940 from foreign currency translation for the six months ended June 30, ~~2022~~2023 and $~~2,839,631~~4,163,735 loss for the six months ended June 30, ~~2021,~~2022, in accumulated other comprehensive loss.

Non-controlling interests

Non-controlling interests represent the equity in subsidiary not attributable, directly or indirectly, to owners of the Company, and are presented separately in the condensed consolidated statements of operation and comprehensive income, and within equity in the Condensed Consolidated Balance Sheets, separately from equity attributable to owners of the Company.

On June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the aggregate non-controlling interests in the Company were $~~12,844,123~~10,363,141 and $~~21,912,268~~11,009,149, respectively.

Capitalized Financing Costs

Financing costs, such as loan origination fee, administration fee, interests, and other related financing costs should be capitalized and recorded on the balance sheet, if these financing activities are directly associated with the development of real estate.

Capitalized financing costs are allocated to lots sold based on the total expected development and interest costs of the completed project and allocating a percentage of those costs based on the selling price of the sold lot compared to the expected sales values of all lots in the project. If the allocation of capitalized financing costs based on the projection and relative expected sales value is impracticable, those costs could also be allocated based on an area method, which uses the size of the lots compared to the total project area and allocates costs based on their size.

As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the capitalized financing costs were $1,225,739 and $3,247,739., respectively.

Beneficial Conversion Features

The Company evaluates the conversion feature for whether it was beneficial as described in ASC 470-30. The intrinsic value of a beneficial conversion feature inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible note payable and may not be settled in cash upon conversion, is treated as a discount to the convertible note payable. This discount is amortized over the period from the date of issuance to the date the note is due using the effective interest method. If the note payable is retired prior to the end of its contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the beneficial conversion feature is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the shares of common stock at the commitment date to be received upon conversion.

~~F-20~~F-19

Recent Accounting Pronouncements

Accounting pronouncement adopted

In October 2021, the FASB issued ASU No. 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.” ASU 2021-08 requires the company acquiring contract assets and contract liabilities obtained in a business combination to recognize and measure them in accordance with ASC 606, “Revenue from Contracts with Customers”. At the acquisition date, the company acquiring the business should record related revenue, as if it had originated the contract. Before the update such amounts were recognized by the acquiring company at fair value. The amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted, including in interim periods, for any financial statements that have not yet been issued. The Company ~~plans to adopt~~adopted these requirements prospectively, effective on the first day of the year 2023.

~~Accounting pronouncement not yet adopted~~

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). ASU 2016-13 requires financial assets measured at amortized cost to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amounts. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances. ASU 2016-13 is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years, and a modified retrospective approach is required, with a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. In November of 2019, the FASB issued ASU 2019-10, which delayed the implementation of ASU 2016-13 to fiscal years beginning after December 15, 2022 for smaller reporting companies. The Company ~~is currently evaluating~~adopted these requirements prospectively, effective on the ~~impact~~first day of ~~ASU 2016-13 on its future consolidated financial statements.~~the year 2023.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of Reference Rate Reform on Financial Reporting. The amendments in this update provide optional expedients and exceptions for applying generally accepted accounting principles (GAAP) to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this update apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The Company’s line of credit agreement provides procedures for determining a replacement or alternative rate in the event that LIBOR is unavailable. The amendments in this update are effective for all entities as of March 12, 2020 through December 31, ~~2022.~~2024. The Company ~~is currently evaluating the impact of~~does not believe that ASU 2020-04 will have significant impact on its future consolidated financial statements.

Accounting pronouncement not yet adopted

In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) which simplifies the accounting for convertible instruments. The guidance removes certain accounting models which separate the embedded conversion features from the host contract for convertible instruments. Either a modified retrospective method of transition or a fully retrospective method of transition is permissible for the adoption of this standard. Update No. 2020-06 is effective for fiscal years beginning after December 15, 2023 for smaller reporting companies, including interim periods within those fiscal years. Early adoption is permitted no earlier than the fiscal year beginning after December 15, 2020. The Company is currently evaluating the impact of ASU 2020-06 on its future consolidated financial statements.

3. CONCENTRATIONS

The Company maintains cash balances at various financial institutions in different countries. These balances are usually secured by the central banks’ insurance companies. At times, these balances may exceed the insurance limits. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, uninsured cash and restricted cash balances were $~~38,856,265~~26,119,471 and $~~57,905,303~~15,723,599, respectively.

For the three months ended June 30, 2023, three customers accounted for approximately 37%, 36% and 27% of the Company’s property development revenue. For the three months ended June 30, 2022, two customers accounted for approximately 85%, and 15% of the Company’s property development revenue. For the ~~three~~six months ended June 30, ~~2021, two~~2023, three customers accounted for approximately 9737%, 36%, and 327% of the Company’s property development revenue. For the six months ended June 30, 2022, three customers accounted for approximately 42%, 49%, and 9~~% of the Company’s property development revenue. For the six months ended June 30, 2021, two customers accounted for approximately~~ 97~~%, and~~ 3% of the Company’s property development revenue.

~~F-21~~F-20

4. SEGMENTS

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision–making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision-maker is the CEO. The Company operates in and reports four business segments: real estate, digital transformation technology, biohealth, and other business activities. The Company’s reportable segments are determined based on the services they perform and the products they sell, not on the geographic area in which they operate. The Company’s chief operating decision maker evaluates segment performance based on segment revenue. Costs excluded from segment income (loss) before taxes and reported as “Other” consist of corporate general and administrative activities which are not allocable to the four reportable segments.

The following table summarizes the Company’s segment information for the following balance sheet dates presented, and for the six months ended June 30, ~~2022~~2023 and ~~2021:~~2022:

SCHEDULE OF SEGMENT INFORMATION

																Real Estate			Digital Transformation Technology			Biohealth Business			Other			Total
	Real Estate			Digital Transformation Technology			Biohealth Business			Other			Total

Six Months Ended on June 30, 2022
Six Months Ended on June 30, 2023
Revenue	$	1,924,916		$	7,701		$	749,693		$	196,267		$	2,878,577		$	19,515,728		$	28,074		$	12,786		$	524,196		$	20,080,784
Cost of Sales		(1,625,942	)		(2,792	)		(11,985	)		(24,508	)		(1,665,227	)		(12,168,470	)		(9,139	)		(109,657	)		(140,508	)		(12,427,774	)
Gross Margin		298,974			4,909			737,708			171,759			1,213,350			7,347,258			18,935			(96,871	)		383,688			7,653,010
Operating Expenses		(1,320,957	)		(159,976	)		(910,246	)		(2,129,974	)		(4,521,153	)		(992,201	)		(202,430	)		(477,917	)		(2,960,696	)		(4,633,244	)
Operating Loss		(1,021,983	)		(155,067	)		(172,538	)		(1,958,215	)		(3,307,803	)		6,355,057			(183,495	)		(574,788	)		(2,577,008	)		3,019,766
Other Income (Expense)		209			(764,968	)		(3,039,097	)		(10,579,541	)		(14,383,397	)		215,306			(1,091,514	)		835,888			(13,116,034	)		(13,156,354	)
Net Loss Before Income Tax		(1,021,774	)		(920,035	)		(3,211,635	)		(12,537,756	)		(17,691,200	)	$	6,570,363		$	(1,275,009	)	$	261,100		$	(15,693,042	)	$	(10,136,588	)

																Real Estate			Digital Transformation Technology			Biohealth Business			Other			Total
	Real Estate			Digital Transformation Technology			Biohealth Business			Other			Total

Six Months Ended on June 30, 2021
Six Months Ended on June 30, 2022
Revenue	$	8,478,673		$	-		$	3,671,673		$	-		$	12,150,346		$	1,924,916		$	7,701		$	749,693		$	196,267		$	2,878,577
Cost of Sales		(6,125,201	)		-			(180,603	)		-			(6,305,804	)		(1,625,942	)		(2,792	)		(11,985	)		(24,508	)		(1,665,227	)
Gross Margin		2,353,472			-			3,491,070			-			5,844,542			298,974			4,909			737,708			171,759			1,213,350
Operating Expenses		(625,555	)		(69,375	)		(1,910,582	)		(8,321,318	)		(10,926,830	)		(1,320,957	)		(159,976	)		(910,246	)		(2,129,974	)		(4,521,153	)
Operating (Loss) Income		1,727,917			(69,375	)		1,580,488			(8,321,318	)		(5,082,288	)		(1,021,983	)		(155,067	)		(172,538	)		(1,958,215	)		(3,307,803	)
Other Expense		(9,177	)		617,562			(28,743,495	)		(51,026,886	)		(79,161,996	)		209			(764,968	)		(3,039,097	)		(10,579,541	)		(14,383,397	)
Other Income (Expense)																	209			(764,968	)		(3,039,097	)		(10,579,541	)		(14,383,397	)
Net Loss Before Income Tax		1,718,740			548,187			(27,163,007	)		(59,348,204	)		(84,244,284	)	$	(1,021,774	)	$	(920,035	)	$	(3,211,635	)	$	(12,537,756	)	$	(17,691,200	)

June 30, 2022
June 30, 2023
Cash and Restricted Cash	$	3,007,823		$	214,976		$	2,442,236		$	36,331,232		$	41,996,267		$	2,209,538		$	461,704		$	991,986		$	25,828,907		$	29,492,135
Total Assets		47,101,961			1,475,948			7,025,365			120,468,046			176,071,320			61,091,436			3,516,613			5,136,085			98,697,677			168,441,811


December 31, 2021
December 31, 2022
Cash and Restricted Cash	$	7,493,921		$	245,780		$	2,629,464		$	50,433,014		$	60,802,179		$	2,592,577		$	514,260		$	1,338,404		$	14,076,662		$	18,521,903
Total Assets		55,465,600			2,199,466			11,056,779			115,488,298			184,210,143			57,951,324			3,184,416			4,861,615			87,492,981			153,490,336

~~F-22~~F-21

5. REAL ESTATE ASSETS

As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, real estate assets consisted of the following:

SCHEDULE OF REAL ESTATE ASSETS


	June 30, 2022		December 31, 2021		June 30, 2023		December 31, 2022

Construction in Progress	$	9,365,935	$	8,597,023	$	4,660,812	$	15,506,572
Land Held for Development		7,943,126		7,098,104		3,395,701		7,943,126
Rental Properties, net		25,831,478		24,820,253		31,388,691		31,169,031
Total Real Estate Assets	$	43,140,539	$	40,515,380	$	39,445,204	$	54,618,729

Single family residential properties

As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the Company owned ~~112 and 109~~132 Single Family Residential Properties (“SFRs”)~~, respectively.~~. The Company’s aggregate investment in those SFRs was $~~25.7~~31 million. Depreciation expense was $~~173,119~~276,125 and $~~15,222~~173,119 in the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. Depreciation expense was $~~318,743~~519,827 and $~~15,222~~318,743 in the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. These homes are located in Montgomery and Harris Counties, Texas.

The following table presents the summary of our SRFs as of June 30, ~~2022:~~2023:

SUMMARY OF SINGLE FAMILY RESIDENTIAL PROPERTIES

Number of
Homes
Aggregate investment Average Investment per Home
SFRs 112 $ 25,663,582 $ 229,139

Number of

Homes

Aggregate

investment

Average Investment

per Home

SFRs

132

31,388,691

237,793

6. BUILDER DEPOSITS

In November 2015, SeD Maryland Development, LLC (“SeD Maryland”) entered into lot purchase agreements with NVR, Inc. (“NVR”) relating to the sale of single-family home and townhome lots to NVR in the Ballenger Run Project. The purchase agreements were amended three times thereafter. Based on the agreements, NVR iswas entitled to purchase 479 lots for a price of approximately $64,000,000, which ~~escalates~~ 3%escalated 3% annually after June 1, 2018.

As part of the agreements, NVR was required to give a deposit in the amount of $5,600,000. Upon the sale of lots to NVR, 9.9% of the purchase price is taken as payback of the deposit. A violation of the agreements by NVR would cause NVR to forfeit the deposit. On January 3, 2019 and April 28, 2020, NVR gave SeD Maryland two more deposits in the amounts of $100,000 and $220,000, respectively, based on the 3rd Amendment to the Lot Purchase Agreement. On June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, there was $0 ~~and~~ held on deposit. Remaining balance of $31,553 ~~held on deposit, respectively.~~was repaid during 2022.

7. NOTES PAYABLE

As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, notes payable consisted of the following:

SCHEDULE OF NOTES PAYABLE

June 30, 2022 December 31, 2021
PPP Loan - 68,502
Australia Loan - 162,696
Hire Purchase 77,308 86,473
Total notes payable $ 77,308 $ 317,671

June 30,

2023

December 31,

2022

Motor Vehicle Loans

167,898

181,846

Total notes payable

167,898

181,846

~~F-23~~F-22

M&T Bank Loan

On April 17, 2019, SeD Maryland Development LLC entered into a Development Loan Agreement with Manufacturers and Traders Trust Company (“M&T Bank”) in the principal amount not to exceed at any one time outstanding the sum of $8,000,000, with a cumulative loan advance amount of $18,500,000. The line of credit bears interest rate of LIBOR plus 375 basis points. SeD Maryland Development LLC was also provided with a Letter of Credit (“L/C”) Facility in an aggregate amount of up to $900,000. The L/C commission will be 1.5% per annum on the face amount of the L/C. Other standard lender fees will apply in the event the L/C is drawn down. The loan is a revolving line of credit. The L/C Facility is not a revolving loan, and amounts advanced and repaid may not be re-borrowed. Repayment of the Loan Agreement is secured by $2,600,000 collateral fund and a Deed of Trust issued to the Lender on the property owned by SeD Maryland. As of June 30, ~~2022,~~2023, the outstanding balance of the revolving loan was $0. As part of the transaction, the Company incurred loan origination fees and closing fees in the amount of $381,823 and capitalized it into construction in process. On March 15, 2022, approximately $2,300,000 was released from collateral, leaving approximately $300,000 as collateral for outstanding letters of credit.

On June 18, 2020, Alset EHome Inc. (“Alset EHome”), a wholly owned subsidiary of LiquidValue Development Inc., entered into a Loan Agreement with Manufacturers and Traders Trust Company (the “Lender”).

~~Pursuant to the Loan Agreement, the Lender provided a non-revolving loan to Alset EHome in an aggregate amount of up to $2,990,000~~ (the “Loan”). The line of credit bears interest rate of LIBOR plus 375 basis points. Repayment of the Loan is secured by a Deed of Trust issued to the Lender on the property owned by certain subsidiaries of Alset EHome. The maturity date of this Loan is ~~July 1, 2022~~. LiquidValue Development Inc. and one of its subsidiaries are guarantors of this Loan. The guarantors are required to maintain during the term of the loan a combined minimum net worth in an aggregate amount equal to not less than $~~20,000,000~~.

~~During the year ended December 31, 2020, Alset EHome borrowed $664,810~~ ~~from M&T Bank, incurring at the same time a loan origination fees of $61,679~~ ~~which were amortized over the term of the loan. As of December 31, 2020, the remaining unamortized debt discount was $42,906. The loan in the amount of $664,810, together with all accrued interest of $25,225, was paid off on May 28, 2021. The loan was closed in June 2021. Additionally, the debt discount of $42,907~~ ~~was fully amortized during the year ended December 31, 2021.~~

Paycheck Protection Program Loan

On February 11, 2021, the Company entered into a five year note with M&T Bank with a principal amount of $68,502 pursuant to the Paycheck Protection Program (“PPP Term Note”) under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The PPP Loan was evidenced by a promissory note. The PPP Term Note had a fixed annual rate of 1.00%, with the first sixteen months of principal and interest deferred until we applied for loan forgiveness. The PPP Term Note was subject to acceleration upon the occurrence of an event of default.

The PPP Term Note was unsecured and guaranteed by the United States Small Business Administration. The Company applied to M&T Bank for forgiveness of the PPP Term Note, with the amount which may be forgiven equal to at least 60% of payroll costs and other eligible payments incurred by the Company, calculated in accordance with the terms of the CARES Act. In April 2022 the Company received confirmation that the PPP Loan was fully forgiven.

Australia Loan

On January 7, 2017, SeD Perth Pty Ltd (“SeD Perth”) entered into a loan agreement with National Australian Bank Limited (the “Australia Loan”) for the purpose of funding land development. The loan facility provides SeD Perth with access to funding of up to approximately $460,000 and matures on December 31, 2018. The Australia Loan is secured by both the land under development and a pledged deposit of $36,059. This loan is denominated in AUD. Personal guarantees amounting to approximately $500,000 have been provided by our CEO, Chan Heng Fai and by Rajen Manicka, the CEO of Holista CollTech and Co-founder of iGalen Inc. The interest rate on the Australia Loan is based on the weighted average interest rates applicable to each of the business markets facility components as defined within the loan agreement, ranging from 4.12% to 4.86% per annum for the ~~six~~nine months ended ~~June~~September 30, 2021. On September 7, 2017 the Australia Loan was amended to reduce the maximum borrowing capacity to approximately $179,000. During 2020, the terms of the Australia Loan were amended to reflect an extended maturity date of April 30, 2022. This was accounted for as a debt modification. The Company did not pay fees to the National Australian Bank Limited for the modification of the loan agreement. In February 2022, SeD Perth repaid the loan.

~~F-24~~

~~Singapore Car Loan~~Motor Vehicle Loans

On May 17, 2021, Alset International Limited entered into an agreement with Hong Leong Finance Limited to purchase a car for business. The total purchase price of the car, including associated charges, was approximately $184,596. Alset International paid an initial deposit of $78,640, and would make monthly instalment of approximately $1,300, including interest of 1.88% per annum, for the 84 months.

8. On September 22, 2022 Alset International entered into an agreement with United Overseas Bank Limited to purchase additional car for business. The total purchase price of the car, including associated charges, was approximately $~~RELATED PARTY TRANSACTIONS~~182,430. Alset International paid an initial deposit of $66,020 and would make monthly installments of approximately $1,472, including interest of 1.88% per annum, for the 84 months.

Future minimum principal payments under existing motor vehicle loans at June 30, 2023 in each calendar year through the end of their terms are as follows:

SCHEDULE OF FUTURE MINIMUM PAYMENTS


2024	$	29,959
2025		29,959
2026		29,959
2027		29,959
2028		27,680
Thereafter		20,382
Total Future Receipts	$	167,898

F-23

~~Personal Guarantees by Directors~~8. RELATED PARTY TRANSACTIONS

~~As of June 30, 2022 and December 31, 2021, a director of the Company had provided personal guarantees amounting to approximately $~~0 ~~and $500,000, respectively, to secure external loans from financial institutions for AEI and the consolidated entities.~~

Purchase of Shares and Warrants from ~~APM~~NECV

On July 17, 2020, the Company purchased 122,039,000 shares, approximately ~~9.99~~9.99%% ownership, and warrants to purchase 1,220,390,000 ~~warrants~~shares with an exercise price of $0.0001 per share, from ~~APM~~,NECV, for an aggregate purchase price of $122,039. We value ~~APM~~ the NECV warrants under level 3 category through a Black Scholes option pricing model and the fair value of the NECV warrants ~~from~~ ~~APM~~ were $860,342 as of July 17, 2020, the purchase date, $~~507,062~~47,115 as of June 30, ~~2022~~2023 and $~~1,009,854~~327,565 as of December 31, ~~2021, respectively.~~2022. The difference of $945,769 of fair value of stock and warrants, total $1,067,808 and the purchase price $122,039, was recorded as additional paid in capital at December 31, 2021, as ~~it was a related party transaction.~~

~~Sale of Investment in Vivacitas to DSS~~

~~On March 18, 2021, the Company sold its equity investment in Vivacitas, a U.S.-based biopharmaceutical company, consisting of~~ ~~2,480,000~~ ~~shares of common stock and an option to purchase~~ ~~250,000~~ ~~shares of Vivacitas common stock at $~~1 ~~per share at any time prior to the date of a public offering, to a subsidiary of DSS for $2,480,000~~. Chan Heng Fai, our Chairman, CEO and founder, serves as a director of Vivacitas and as the Executive Chairman of DSS. After this transaction, we do not own any investment in Vivacitas. Our original cost of common stock and stock option of Vivacitas was $~~200,128. We did not recognize gain or loss in this transaction. The difference of $2,279,872~~ ~~between the selling price and our original investment cost was recorded as additional paid capital, reflecting that~~ it was a related party transaction.

Purchase and Sale of Stock in True Partners Capital Holding Limited

On March 12, 2021, the Company purchased 62,122,908 ordinary shares of True Partners Capital Holding Limited for $6,729,629 from a related party. The fair market value of such stock on the acquisition date was $10,003,689. The difference between the purchase price and the fair market value of $3,274,060 was recorded as an equity transaction on Company’s condensed consolidated statement of stockholders’ equity at December 31, 2021. Pursuant to a Stock Purchase Agreement from February 2022, the Company sold 62,122,908 shares of True Partner to DSS Inc. (through the transfer of subsidiary and otherwise), for a purchase price of 17,570,948 shares of common stock of DSS. DSS shareholders approved the Stock Purchase Agreement on May 17, 2022 (which is deemed to be the effective date of this transaction). The transaction loss of $446,104, which is the difference between the fair value of True Partner stock and fair value of DSS stock at the agreement’s effective date, was recorded as other expense in the Company’s Statement of Operations.

SHRG Shares Dividend Received from DSS

On May 4, 2023, DSS distributed approximately 280 million shares of Sharing Services Global Corporation (“SHRG”) beneficially held by DSS and its subsidiaries in the form of a dividend to the shareholders of DSS common stock. As a result of this distribution, the Company directly received 70,426,832 shares of SHRG, and through its majority-owned subsidiary Alset International Limited, and certain subsidiaries of Alset International Limited, indirectly received additional 55,197,696 shares of SHRG. The Company and its majority-owned subsidiaries now collectively own 125,624,528 shares of SHRG, representing 33.4% of the issued and outstanding shares of SHRG Common Stock (such number of SHRG shares held and ownership percentage do not include any shares held by affiliates of the Company which we do not hold a majority interest in). Additionally, our founder, Chairman and Chief Executive Officer, Chan Heng Fai, directly and indirectly is the owner of an additional 37,947,756 shares of SHRG and is a beneficial owner of approximately 43.5% of SHRG shares (including those shares owned by Alset Inc. and its majority-owned subsidiaries).

Consolidation of Alset Capital Acquisition Corp.

On May 1, 2023, Alset Capital Acquisition Corp. (“Alset Capital”) held a Special Meeting of Stockholders. In connection with the Special Meeting and certain amendments to Alset Capital’s Amended and Restated Certificate of Incorporation, 6,648,964 shares of Alset Capital’s Class A Common Stock were rendered for redemption. Following the redemption, 2,449,786 shares of Class A Common Stock of Alset Capital remained issued and outstanding, including 473,750 shares held by the Company. The Company also owns 2,156,250 shares of Alset Capital’s Class B Common Stock. Following the redemptions, Company’s ownership in Alset Capital has increased from 23.4% of the total shares of common stock to 57.1% of the total number of outstanding shares of the two classes. The Company recognized $21,657,036 loss on the consolidation of Alset Capital. The loss is included in Finance Costs on the Company’s Consolidated Statement of Operations for the three and six months ended June 30, 2023.

Purchase of Hapi Travel Ltd. Stock

On June 14, 2023, one of the Company’s subsidiaries acquired Hapi Travel Ltd. from Business Mobile Intelligence Ltd., a company 100% owed by our CEO and majority stockholder, Chan Heng Fai, for consideration of $214,993. On November 17, 2021, Chan Heng Fai had acquired Hapi Travel Ltd. (formerly known as Travel Panda Ltd.) from Chan Hei Wai, an individual unaffiliated with the Company.

F-24

Notes Payable

Chan Heng Fai provided an interest-free, due on demand advance to LiquidValue Development Pte. Ltd. and its subsidiary LiquidValue Development Limited for the general operations of such entities. As of June 30, 2022 and December 31, 2021, the outstanding balance was approximately $0~~, and $820,113, respectively.~~

~~F-25~~

Chan Heng Fai provided an interest-free, due on demand advance to Alset EHome International for the Company’s general operations. The advance was paid back during the year ended December 31, 2021 and as of June 30, 2022 and December 31, 2021, the outstanding balance was $0.

Chan Heng Fai provided an interest-free, due on demand advance to SeD Perth Pty. Ltd. for its general operations. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the outstanding balance was $~~12,848~~12,343 and $~~13,546~~12,668, respectively.

~~On August 20, 2020, the Company acquired~~ ~~30,000,000~~ ~~common shares from~~ Chan Heng Fai ~~in exchange~~provided an interest-free, due on demand advance to Hapi Metaverse Inc. for ~~a two-year non-interest bearing note of $1,333,429. During the year ended December 31, 2021, the Company paid back all $1,333,429~~ ~~and as~~its general operations. As of June 30, ~~2022~~2023 and December 31, ~~2021 the amount outstanding was $~~0.

On March 12, 2021, the Company entered into a Securities Purchase Agreement (the “SPA”) with Chan Heng Fai, the founder, Chairman and Chief Executive Officer of the Company, for four proposed transactions, consisting of (i) purchase of certain warrants (the “Warrants”) to purchase ~~1,500,000,000~~ ~~shares of Alset International Limited, which was valued at $28,363,966; (ii) purchase of all of the issued and outstanding stock of LiquidValue Development Pte Ltd. (“LVD”), which was valued at $173,395; (iii) purchase of~~ ~~62,122,908~~ ~~ordinary shares in True Partner Capital Holding Limited (HKG: 8657) (“True Partner”), which was valued at $6,729,629; and (iv) purchase of~~ ~~4,775,523~~ ~~shares of the common stock of American Pacific Bancorp Inc. (“APB”), which was valued at $28,653,138. The total amount of above four transactions was $63,920,129~~, payable on the Closing Date by the Company, in the convertible promissory notes (“Alset CPNs”), which, subject to the terms and conditions of the Alset CPNs and the Company’s shareholder approval, shall be convertible into shares of the Company’s common stock (“AEI Common Stock”), at par value of $~~0.001~~ ~~per share, at the conversion price of AEI’s Stock Market Price. AEI’s Stock Market Price shall be $5.59~~ ~~per share, equivalent to the average of the five closing per share prices of AEI Common Stock preceding January 4, 2021 as quoted by Bloomberg L.P. AEI’s stock price was $10.03~~ ~~on March 12, 2021, the commitment date. The Beneficial Conversion Feature (“BCF”) intrinsic value was $50,770,192~~ ~~for the four convertible promissory notes and was recorded as debt discount of convertible notes after the transaction. On May 13 and June 14, 2021 all Alset CPNs of $63,920,128~~ ~~and accrued interests of $306,438~~ ~~were converted into~~ ~~2,123~~ ~~shares of Series B preferred stock and~~ ~~9,163,965~~ ~~shares of common stock of the Company.~~

~~On May 14, 2021, the Company borrowed S$7,395,472~~ ~~Singapore Dollars (equal to approximately $5,545,495~~ ~~U.S. Dollars) from Chan Heng Fai. The unpaid principal amount of the Loan is due and payable on May 14,~~ 2022, ~~and the Loan has no interest. The loan was paid back in full during 2021 and~~ the outstanding balance was $04,138 ~~as of June 30, 2022~~ and ~~December 31, 2021.~~$4,158, respectively.

Management Fees

MacKenzie Equity Partners, LLC, an entity owned by Charles MacKenzie, the Chief Development Officer of the Company, has had a consulting agreement with a majority-owned subsidiary of the Company since 2015. Pursuant to the terms of the agreement, as amended on January 1, 2018, the Company’s subsidiary paid a monthly fee of $20,000 for consulting services. Pursuant to an agreement entered into in June of 2022, the Company’s subsidiary has paid $25,000 per month for consulting services, effective as of January 2022.

In addition, MacKenzie Equity Partners will be paid certain bonuses, including (i) a sum of $50,000 on June 30, 2022; (ii) a sum of $50,000 upon the successful financing of 100 homes owned by American Housing REIT Inc. with an entity not affiliated with SeD Development Management LLC (a subsidiary of the Company); and (iii) a sum of $50,000 upon the successful leasing of 30 homes in the Alset of Black Oak development.

The Company incurred expenses of $~~60,000~~75,000 and $~~180,000~~150,000 in the three and six months ended June 30, ~~2021,~~2023, respectively, and $140,000 and $200,000 in the three and six months ended June 30, 2022, respectively, which were capitalized as part of Real Estate on the balance sheet as the services relate to property and project management. In ~~2021,~~June 2022, MacKenzie Equity Partners was paid ~~a bonus payment of $120,000. In June 2022, MacKenzie Equity Partners accrued an additional~~ $50,000 bonus payment (as described above). On June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the Company owed this related party $~~100,000~~25,000 and $~~80,000~~25,000, respectively.

~~F-26~~

Notes Receivable from Related Party

On March 2, 2020 and on October 29, 2021, LiquidValue Asset Management Pte. Ltd. (“LiquidValue”) received two $200,000Promissory Notes and on October 29, 2021 Alset International received $8,350,000Promissory Note from American Medical REIT Inc. (“AMRE”), a company which is ~~15.8~~15.8%% owned by LiquidValue as of ~~June~~September 30, 2022. Chan Heng Fai and Chan Tung Moe are directors of American Medical REIT Inc. The notes carry interest rates of 88%% and are payable in two,, three years and 25 months, respectively. LiquidValue also received warrants to purchase AMRE shares at the exercise price of ~~$5.00~~$5.00 per share. The amount of the warrants equals to the note principal divided by the exercise price. If AMRE goes to IPO in the future and IPO price is less than $10.00 per share, the exercise price shall be adjusted downward to fifty percent (50%) of the IPO price.In March 2022 the Company converted two $200,000loans, together with associated warrants into 167,938common shares of AMRE, and increased its ownership in AMRE from ~~3.4~~3.4%% to ~~15.8~~15.8%%. AsOn July 12, 2022, pursuant to Assignment and Assumption Agreement from February 25, 2022, as amended on July 12, 2022, the Company sold the $8,350,000 loan, together with accrued interest, to DSS for a purchase price of ~~December 31, 2021,~~21,366,177 shares of DSS’s common stock. The loss from this transaction of $1,089,675 was calculated as the difference between the face value of promissory note together with accrued interest and the fair ~~market~~ value of ~~the warrants was $~~0~~. The Company accrued $334,000~~ ~~and $130,000~~ ~~interest income as of June 30,~~DSS stock on July 12, 2022, and ~~December 31, 2021, respectively.~~was recorded under Other Expense in Statement of Operations.

~~On January 24, 2017, SeD Capital Pte Ltd, a~~ ~~100% owned subsidiary of Alset International lent $350,000~~ ~~to iGalen Inc.~~ The term of the loan was two years, with an interest rate of 3% per annum for the first year and 5% per annum for the second year. The expiration term was renewed as due on demand after two years with 5% per annum interest rate. ~~As of December 31, 2020, the outstanding principal was $350,000~~ ~~and accrued interest $61,555~~. On December 31, 2021, the management of the Company evaluated the financial and the operation results of iGalen and concluded that possibility to repay this loan is not probable, and the principal and accrued interest total of $~~412,754~~ ~~was recorded as bad debt expense.~~

F-25

As of June 30, 2023 and December 31, 2022, the Company provided advances for operation of $236,699 to HWH World Co., a direct sales company in Thailand of which the Company holds approximately 1919%% ownership.

In the first quarter of 2022, a subsidiary of the Company made a non-interest bearing advance in the amount of $476,250 on behalf of Alset Investment Pte. Ltd., a company 100% owned by one of our directors. Such advance was made in connection with a private placement into Alset Capital Acquisition Corp. by its sponsor, Alset Acquisition Sponsor, LLC. During 2022, Alset Investment repaid all balance due of $476,250.

In June 2022, Alset International Limited, a subsidiary of the Company, entered into a stock purchase agreement with one of our directors and paid $1,746,279 to one of our directors as the consideration for purchase of 7,276,163 common shares of Value Exchange International. This transaction was terminated under the agreement of both parties thereafter. On October 17, 2022 the Company purchased 7,276,163 common shares of Value Exchange International for an aggregate purchase price of $1,743,734. After the transaction the Company owns approximately 38.3% of Value Exchange International.

On July 28, 2022 Hapi Café Inc. entered into binding term sheet (the “First Term Sheet”) with Ketomei Pte Ltd and Tong Leok Siong Constant, pursuant to which Hapi Café lent Ketomei $41,750. This loan has a 0% interest rate for the first 60 days and an interest rate of 8% per annum afterwards. On August 4, 2022 the same parties entered into another binding term sheet (the “Second Term Sheet”) pursuant to which Hapi Café agreed to lend Ketomei up to S$360,000 Singapore Dollars (equal to approximately $250,500 US Dollars) pursuant to a convertible loan, with a term of 12 months. After the initial 12 months, the interest on such loan will be 8%. In addition, pursuant to the Second Term Sheet, the July 28, 2022 loan was modified to include conversion rights. In August 2022, Ketomei drew $29,922 from the loan. As of June 30, 2023 and December 31, 2022, Ketomei owed $260,961 and $198,162 to Hapi Café, respectively.

On October 13, 2021 BMI Capital Partners International Limited (“BMI”) entered into loan agreement with Liquid Value Asset Management Limited (“LVAML”), a subsidiary of DSS, pursuant to which BMI agreed to lend $3,000,000 to LVAML. The loan has variable interest rate and matures on ~~October~~January 12, ~~2022.~~2023, with automatic three-month extension. The purpose of the loan is to purchase a portfolio of trading securities by LVAM. BMI participates in the losses and gains from portfolio based on the calculations included in the loan agreement. As of June 30, ~~2022~~2023 and December 31, ~~2021~~2022 LVAML owes the Company $~~2,986,811~~516,165 and $~~2,987,039~~3,042,811, respectively.

InOn January 27, 2023, the ~~first quarter of 2022,a~~Company’s subsidiary ofHapi Metaverse Inc. and New Electric CV Corp. (“NECV,” and together with Hapi Metaverse Inc., the ~~Company made a non-interest bearing advance in the amount of $476,250~~ ~~on behalf of Alset Investment Pte. Ltd., a company~~ ~~100~~% owned by one of our directors. Such advance was made in connection with a private placement into Alset Capital Acquisition Corp. by its sponsor, Alset Acquisition Sponsor, LLC. Alset Investment Pte. Ltd. agreed to pay back the full outstanding amount prior to the end of September 2022.

~~In June 2022, Alset International Limited, a subsidiary of the Company,~~“Lenders”) entered into a ~~stock purchase agreement~~Convertible Credit Agreement (the “Credit Agreement”) with ~~one~~Value Exchange International, Inc. (“Value Exchange”), a Nevada corporation. The Credit Agreement provides Value Exchange with a maximum credit line of ~~our directors~~$1,500,000 (“Maximum Credit Line”) with simple interest accrued on any advances of the money under the Credit Agreement at 8%. The principal amount of any advance of money under the Credit Agreement (each being referred to as an “Advance”) is due in a lump sum, balloon payment on the third annual anniversary of the date of the Advance (“Advance Maturity Date”). Accrued and unpaid interest on any Advance is due and payable on a semi-annual basis with interest payments due on the last business day of June and last business day of December of each year. A Lender may demand that any portion or all of the unpaid principal amount of any Advance as well as accrued and unpaid interest thereon may be paid $~~1,746,279~~ ~~to one of our directors as the consideration to purchase the stocks~~by shares of Value Exchange ~~International. This transaction~~Common Stock in lieu of cash payment. As of June 30, 2023, $1,400,000 of credit was ~~terminated under the agreement of both parties thereafter. The director agreed to fully refund the amount~~used, and interest income of $~~1,746,279~~27,923 ~~or to work on a new stock sale deal with the Company~~and $38,970 is included in interest income in the ~~third quarter of 2022.~~

~~The Company paid some operating expenses for Alset Capital Acquisition Corp., a special purpose acquisition company of which the Company holds~~ ~~23.4%. The advances are interest free with no set repayment terms. On~~three and six months ended June 30, ~~2022 and December 31, 2021, the balance of these advances was $~~2023, respectively.

F-26

~~Loan~~9. GOODWILL

The Company and its subsidiaries continually evaluate potential acquisitions that align with the Company’s plans. Starting an F&B business in Hong Kong, China, and Taiwan can be an excellent opportunity due to ~~Employees~~the large consumer market, diverse food culture, high demand for international cuisine, favorable business environment, skilled labor force, and opportunities for growth.

On ~~November 24, 2020, American Pacific Bancorp. Inc. lent $560,000~~ ~~to Chan Tung Moe, an officer~~October 4, 2022, the Company completed its first F&B business acquisition of ~~one~~MOC HK Limited (“MOC”), a F&B business started in Hong Kong. The accompanying consolidated financial statements include the operations of the ~~subsidiaries~~acquired entity from its acquisition date. The acquisition has been accounted for as a business combination. Accordingly, consideration paid by the Company to complete the acquisition is initially allocated to the acquired assets and liabilities assumed based upon their estimated acquisition date fair values. The recorded amounts for assets acquired and liabilities assumed are provisional and subject to change during the measurement period, which is up to 12 months from the acquisition date.

As a result of the acquisition of MOC, goodwill of $60,363 generated in a business combination represents the purchase price of $70,523 in excess of identifiable tangible and intangible assets. Goodwill and intangible assets that have an indefinite useful life are not amortized. Instead, they are reviewed periodically for impairment.

On June 14, 2023, the Company ~~and son~~completed acquisition of ~~Chan Heng Fai, Chairman and Chief Executive Officer~~Hapi Travel Limited (“HTL”), an online travel business started in Hong Kong. The accompanying consolidated financial statements include the operations of the acquired entity from its acquisition date. The acquisition has been accounted for as a business combination. Accordingly, consideration paid by the Company ~~bearing interest at~~ to complete the acquisition is initially allocated to the acquired assets and liabilities assumed based upon their estimated acquisition date fair values. The recorded amounts for assets acquired and liabilities assumed are provisional and subject to change during the measurement period, which is up to 12 months from the acquisition date.

6~~%, with~~

As a ~~maturity date of~~ ~~November 23, 2023~~. ~~This loan was secured by an irrevocable letter of instruction on 80,000 shares of Alset EHome International.~~ ~~On November 24, 2020, American Pacific Bancorp. Inc. lent $280,000~~ ~~to Lim Sheng Hon Danny, an employee of one~~result of the ~~subsidiaries~~acquisition of HTL, goodwill of $214,174 generated in a business combination represents the purchase price of $214,993 in excess of identifiable tangible and intangible assets. Goodwill and intangible assets that have an indefinite useful life are not amortized. Instead, they are reviewed periodically for impairment.

The Company evaluates goodwill on an annual basis in the fourth quarter or more frequently, if management believes indicators of impairment exist. Such indicators could include, but are not limited to (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, or (3) an adverse action or assessment by a regulator. The Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If management concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, management conducts a quantitative goodwill impairment test. The impairment test involves comparing the fair value of the applicable reporting unit with its carrying value. The Company ~~bearing interest at~~ 6~~%, with~~estimates the fair values of its reporting units using a ~~maturity date~~combination of ~~November 23, 2023~~. ~~This loan was secured by~~the income, or discounted cash flows, approach and the market approach, which utilizes comparable companies’ data. If the carrying amount of a reporting unit exceeds the reporting unit’s fair value, an ~~irrevocable letter of instruction on 40,000 shares of Alset EHome International.~~ ~~Subsequent~~impairment loss is recognized in an amount equal to that excess, limited to the ~~making~~total amount of ~~these loans,~~goodwill allocated to that reporting unit. The Company’s evaluation of goodwill completed during the ~~Company acquired~~period resulted in no impairment losses.

The table below reflects the ~~majority~~Company’s estimates of the ~~issued~~acquisition date fair value of the assets acquired and ~~outstanding common stock~~liabilities assumed for the 2022 and 2023 acquisition:

SCHEDULE OF ESTIMATES OF ACQUISITION FAIR VALUE

	MOC			HTL
Acquisition Date		October 4, 2022			June 14, 2023

Purchase Price
Cash	$	70,523		$	214,993
Total purchase consideration		70,523			214,993

Purchase Price Allocation
Assets acquired
Current assets		32,700			15,098
Property and Equipment, net		11,266			1,485
Operating lease right-of-use assets, net		114,232			16,516
Total assets acquired		158,198			33,099

Liabilities assumed:
Current liabilities		(33,437	)		(20,885	)
Operating lease liability		(114,232	)		(11,395	)
Accrued taxes		(349	)		-
Total liabilities assumed		(148,018	)		(32,280	)

Net assets acquired		10,180			819
Goodwill		60,343			214,174
Total purchase consideration	$	70,523		$	214,993

The following table summarizes changes in the carrying amount of ~~American Pacific Bancorp. During the year ended~~goodwill at June 30, 2023 and December 31, ~~2021, both principal and interest, $840,000~~ ~~and $28,031, of both loans to Chan Tung Moe and Lim Sheng Hong, were fully paid off.~~2022

SCHEDULE OF GOODWILL

	June 30, 2023			December 31, 2022

Balance at beginning of the period/year	$	60,343		$	-
Acquisitions		214,174			60,343
Foreign currency exchange adjustment		(283	)
Balance as of end of the period/year	$	274,234		$	60,343

F-27

9.10. EQUITY

On June 14, 2021, the Company filed an amendment (the “Amendment”) to its Third Amended and Restated Certificate of Incorporation, as amended, to increase the Company’s authorized share capital. The Amendment increased the Company’s authorized share capital to 250,000,000 common shares and 25,000,000 preferred shares, from 20,000,000 common shares and 5,000,000 preferred shares, respectively.

The Company has designated 6,380 preferred shares as Series A Preferred Stock and 2,132 as Series B Preferred Stock.

On December 6, 2022 the Company filed a certificate of Amendment to the Company’s Certificate of Formation with the Texas Secretary of State to effect a 1-for-20 reverse stock split. The reverse stock split was effective as of December 28, 2022.

Holders of the Series A Preferred Stock shall be entitled to receive dividends equal, on an as-if-converted basis, to and in the same form as dividends actually paid on shares of the Company’s common stock, par value $0.001 per share (“Common Stock”) when, as and if paid on shares of Common Stock. Each holder of outstanding Series A Preferred Stock is entitled to vote equal to the number of whole shares of Common Stock into which each share of the Series A Preferred Stock is convertible. Holders of Series A Preferred Stock are entitled, upon liquidation of the Company, to receive the same amount that a holder of Series A Preferred Stock would receive if the Series A Preferred Stock were fully converted into Common Stock.

Holders of the Series B Preferred Stock shall be entitled to receive dividends equal, on an as-if-converted basis, to and in the same form as dividends actually paid on shares of the Company’s common stock par value $0.001 per share (“Common Stock”) when, as and if paid on shares of Common Stock. Each holder of outstanding Series B Preferred Stock is entitled to vote equal to the number of whole shares of Common Stock into which each share of the Series B Preferred Stock is convertible. Holders of Series B Preferred Stock are entitled, upon liquidation of the Company, to receive the same amount that a holder of Series B Preferred Stock would receive if the Series B Preferred Stock were fully converted into Common Stock.

The Company analyzed the Preferred stock and the embedded conversion option for derivative accounting consideration under ASC 815-15 “Derivatives and Hedging” and determined that the conversion option should be classified as equity.

On ~~January 19, 2021, the Company issued~~ ~~10,000~~ ~~shares of its common stock as compensation for public relations services at a fair value of $60,900~~.

On May 3, 2021, the Company entered into a Loan and Exchange Agreement with its Chief Executive Officer, Chan Heng Fai pursuant to which he loaned the Company his shares of Common Stock of the Company by exchanging ~~6,380,000~~ ~~shares of common stock which he owned for an aggregate of~~ ~~6,380~~ ~~shares of the Company’s newly designated Series A Convertible Preferred Stock. Effective upon the filing of the Amendment in June 2021, the Company issued an entity owned by Chan Heng Fai~~ ~~6,380,000~~ ~~shares of common stock upon the automatic conversion of all~~ ~~6,380~~ ~~outstanding shares of the Company’s Series A Convertible Preferred Stock.~~

~~On May 12, 2021,~~February 6, 2023, the Company entered into an ~~Exchange~~Underwriting Agreement (the “Underwriting Agreement”) in connection with ~~Chan Heng Fai, pursuant to which he converted $13,000,000~~ ~~of note payable for~~ ~~2,132~~ ~~shares of the Company’s newly designated Series B Preferred Stock. Effective upon the filing of the Amendment in June 2021, the Company issued Chan Heng Fai~~ ~~2,132,000~~ ~~shares of common stock upon the automatic conversion of all~~ ~~2,132~~ ~~outstanding shares of the Company’s Series B Convertible Preferred Stock.~~

~~On May 10, 2021, the Company entered into~~ an ~~underwriting agreement with Aegis Capital Corp., as the sole book-running manager and representative of the underwriters named therein (the “Underwriters”), relating to an underwritten public~~ offering (the ~~“May Offering”~~“Offering”) of ~~(i)~~ ~~4,700,637~~ ~~common units (the “Common Units”), at a price to the public of $5.07~~ ~~per Common Unit, with each Common Unit consisting of (a) one share of~~its common stock, par value $0.001 per share (the “Common Stock”), ~~(b) one Series A warrant~~with Aegis Capital Corp. (the ~~“Series A Warrant” and collectively,~~“Underwriter”) as the ~~“Series A Warrants”)~~underwriter, relating to ~~purchase one share~~an underwritten public offering of ~~Common Stock with an initial exercise price of $5.07~~1,727,273 per whole share, exercisable until the fifth anniversary of the issuance date, and (c) one Series B warrant (the “Series B Warrant” and collectively, the “Series B Warrants” and together with the Series A Warrants, the “Warrants”) to purchase one-half share of Common Stock with an initial exercise price of $~~6.59~~ ~~per whole share, exercisable until the fifth anniversary of the issuance date and (ii)~~ ~~1,611,000~~ ~~pre-funded units (the “Pre-funded Units”), at a price to the public of $5.06~~ per Pre-funded Unit, with each Pre-funded Unit consisting of (a) one pre-funded warrant (the “Pre-funded Warrant” and collectively, the “Pre-funded Warrants”) to purchase one share of Common Stock, (b) one Series A Warrant and (c) one Series B Warrant. The shares of Common Stock at a public offering price of $2.20 per share. The Underwriting Agreement provides the Pre-funded Warrants, and the Warrants were offered together, but the securities contained in the Common Units and the Pre-funded Units were issued separately. Following the May Offering, all the investors exercised their Pre-funded Units andUnderwriter a 45-day option to purchase up to an additional ~~1,611,000~~212,863 shares of ~~common stock and Series A and Series B Warrants were issued.~~Common Stock to cover over-allotments, if any.

F-28

The ~~Company also granted the Underwriters a 45-day over-allotment option to purchase up to~~ ~~808,363~~ ~~additional shares of Common Stock and/or up to~~ ~~808,363~~ ~~additional Series A Warrants to purchase~~ ~~808,363~~ ~~shares of Common Stock, and/or up to~~ ~~808,363~~ ~~additional Series B warrants to purchase~~ ~~404,181~~ ~~shares of Common Stock. The May Offering, including the partial exercise of the Underwriters’ over-allotment option to purchase~~ ~~808,363~~ ~~Series A Warrants and~~ ~~808,363~~ ~~Series B Warrants, closed on May 13, 2021. During the month of June 2021, Aegis exercised its option to purchase an additional~~ ~~808,363~~ ~~common shares at a price of $5.07~~ ~~per common share and as of June 30, 2022 still holds~~ ~~808,363~~ ~~Series B Warrants. Through June 30, 2022, investors exercised~~ ~~1,364,025~~ ~~of Series A Warrants and~~ ~~6,598~~ ~~of Series B Warrants. As a result of the May Offering and subsequent exercise notice received for the pre-funded units and warrants, the Company issued~~ ~~8,487,324~~ ~~common shares. As a result of the May Offering and subsequent exercise notice received for the pre-funded units and warrants, and the~~ net proceeds to the Company from the Offering were approximately $~~39,765,440~~3.4. million, after deducting underwriting discounts and the payment of other offering expenses associated with the Offering that are payable by the Company.

The ~~Company incurred approximately $88,848~~ ~~in expenses related to the May Offering and subsequent warrants exercises, including SEC fees, FINRA fees, auditor fees and filing fees.~~

~~The following table presents net funds received from the May Offering and warrants exercised as of June 30, 2022.~~

~~SCHEDULE OF NET FUNDS RECEIVED ON OFFERING AND WARRANTS EXERCISED~~

Shares Par value Amount received
Offering 4,700,637 $ 4,701 $ 29,145,056
Exercise of Pre-Funded Units 1,611,000 $ 1,611 $ 16,110
Exercise of Underwriter’s Series A Warrants 808,363 $ 808 $ 3,755,774
Exercise of Series A and Series B Warrants 1,367,324 $ 1,367 $ 6,937,347
Offering Expenses - $ - $ (88,848 )
Total 8,487,324 $ 8,487 $ 39,765,439

On July 27, 2021, the Company entered into another underwriting agreement with Aegis Capital Corp., as the sole book-running manager and representative of the underwriters named therein (the “Underwriters”), relating to an underwritten public offering (the “July Offering”) of (i) ~~5,324,139~~ ~~shares of common stock, par value $0.001~~ ~~per share (the “Common Stock”), at a price to the public of $2.12~~ ~~per share of Common Stock and (ii)~~ ~~9,770,200~~ ~~pre-funded warrants (the “Pre-funded Warrants”) to purchase~~ ~~9,770,200~~ ~~shares of Common Stock, at a price to the public of $2.11~~ ~~per Pre-funded Warrant. The~~ Offering closed on ~~July 30, 2021. As~~February 8, 2023. The Common Stock was being offered pursuant to an effective registration statement on Form S-3 (File No. 333-264234), as well as a ~~result of~~prospectus supplement in connection with the ~~July~~ Offering filed with the Securities and ~~subsequent exercise notice received for the pre-funded warrants, the net proceeds to the Company were $33,392,444~~.Exchange Commission.

~~The Company granted the Underwriters a 45-day over-allotment option to purchase up to~~ ~~2,264,150~~ ~~additional shares of Common Stock. The Company also paid the Underwriters an underwriting discount equal to~~ ~~7.0% of the gross proceeds of the Offering and a non-accountable expense fee equal to~~ ~~1.5% of the gross proceeds of the Offering. In addition, the Company agreed to issue to the representative warrants (the “Representative’s Warrants”) to purchase a number of shares equal to~~ ~~3.0%~~ ~~of the aggregate number of shares (including shares underlying the Pre-funded Warrants) sold under in the Offering, or warrants to purchase up to an aggregate of~~ ~~520,754~~ ~~shares, assuming the Underwriters exercise their over-allotment option in full. The Representative’s Warrants have an exercise price equal to~~ ~~125% of the public offering price, or $2.65~~ ~~per share, with an exercise period of~~ 24 ~~months from issuance. On September 9, 2021 the Underwriters exercised their over-allotment option and were issued~~ ~~2,264,150~~ ~~shares of our Common Stock. On September 9, 2021 the Underwriters exercised the option and the Company received $4,386,998~~ ~~proceeds from this exercise.~~

The Pre-funded Warrants were offered and sold to purchasers whose purchase of Common Stock in the Offering would otherwise result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of the Company’s outstanding Common Stock immediately following the consummation of the Offering in lieu of Common Stock that would otherwise result in the purchaser’s beneficial ownership exceeding 4.99% of the Company’s outstanding Common Stock (or, at the election of the purchaser, 9.99%). Each Pre-funded Warrant is exercisable for one share of Common Stock at an exercise price of $0.01 per share. The Pre-funded Warrants are immediately exercisable and may be exercised at any time until all of the Pre-funded Warrants are exercised in full. ~~All of the Pre-Funded Warrants were exercised during 2021.~~

~~F-29~~

~~The Company incurred approximately $49,553~~ ~~in expenses related to the July Offering and subsequent warrants exercises, including SEC fees, FINRA fees, auditor fees and filing fees.~~

~~The following table presents net funds received from the July Offering and warrants exercised as of June 30, 2022.~~

Shares Par value Amount received
Offering 5,324,139 $ 5,324 $ 28,957,297
Exercise of Pre-Funded Units 9,770,200 $ 9,770 $ 97,702
Exercise of Underwriter’s Over-Allotment Option 2,264,150 $ 2,264 $ 4,386,998
Offering Expenses - $ - $ (49,553 )
Total 17,358,489 $ 17,358 $ 33,392,444

On December 5, 2021, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Aegis Capital Corp., as the sole book-running manager and representative of the underwriters named therein (the “Underwriters”), relating to an underwritten public offering (the “December Offering”) of (i) ~~18,076,666~~ ~~shares of common stock, par value $0.001~~ ~~per share (the “Common Stock”), at a price to the public of $0.60~~ ~~per share of Common Stock and (ii)~~ ~~31,076,666~~ ~~pre-funded warrants (the “Pre-funded Warrants”) to purchase~~ ~~31,076,666~~ ~~shares of Common Stock, at a price to the public of $0.599~~ per Pre-funded Warrant. The December Offering closed on December 8, 2021. As a result of the December Offering and subsequent exercise notice received for the pre-funded warrants, the net proceeds to the Company were $~~27,231,875~~.

~~The Company granted the Underwriters a 45-day over-allotment option to purchase up to~~ ~~7,500,000~~ ~~additional shares of Common Stock. The Company also paid the Underwriters an underwriting discount equal to~~ 7~~% of the gross proceeds of the Offering and a non-accountable expense fee equal to~~ 1~~% of the gross proceeds of the Offering. On December 14, 2021, the Company consummated the sale of these~~ ~~7,500,000~~ ~~shares of Common Stock, representing~~ ~~15%~~ ~~of the shares of common stock and the shares underlying the Pre-funded Warrants sold in the offering, that were subject to the underwriters’ over-allotment option at a price of $0.60~~ ~~per share, generating net proceeds of $4,115,000~~.

The Pre-funded Warrants were offered and sold to purchasers whose purchase of Common Stock in the Offering would otherwise result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of the Company’s outstanding Common Stock immediately following the consummation of the Offering. Each Pre-funded Warrant is exercisable for one share of Common Stock at an exercise price of $0.001 per share. The Pre-funded Warrants are immediately exercisable and may be exercised at any time until all of the Pre-funded Warrants are exercised in full. At June 30, 2022 31,076,666 warrants were exercised, some in cashless exercise transactions.

~~The Company incurred approximately $40,621~~ ~~in expenses related to the December Offering and subsequent warrants exercises, including SEC fees, FINRA fees, auditor fees and filing fees.~~

~~F-30~~

~~The following table presents net funds received from the December Offering and warrants exercised as of June 30, 2022.~~

Shares Par value
Amount
received

Offering 18,923,334 $ 18,923 $ 27,263,673
Exercise of Pre-Funded Units 15,223,333 $ 15,223 $ 8,823
Exercise of Underwriter’s Over-Allotment Option 7,500,000 $ 7,500 $ 4,115,000
Offering Expenses - $ - $ (40,621 )
Total 41,646,667 $ 41,647 $ 31,346,875

On June 30, ~~2022,~~2023, there were ~~148,507,188~~9,235,119 common shares issued and outstanding.

The following table summarizes the warrant activity for the six months ended June 30, ~~2022.~~2023.

SCHEDULE OF WARRANT ACTIVITY

Warrant for
Common
Shares

Weighted
Average
Exercise Price

Remaining Contractual
Term
(Years)

Aggregate
Intrinsic
Value

Warrants Outstanding as of December 31, 2021 28,533,147 $ 1.79 1.88 $ -
Warrants Vested and exercisable at December 31, 2021 28,533,147 $ 1.79 1.88 $ -
Granted - -
Exercised (15,843,378 ) 0.001
Forfeited, cancelled, expired - -
Warrants Outstanding as of June 30, 2022 12,689,769 $ 4.02 3.74 $ -
Warrants Vested and exercisable at June 30, 2022 12,689,769 $ 4.02 3.74 $ -

	Warrant for Common Shares		Weighted Average Exercise Price		Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Warrants Outstanding as of December 31, 2022		634,488	$	80.32		3.23	$	-
Warrants Vested and exercisable at December 31, 2022		634,488	$	80.32		3.23	$	-
Granted		-		-
Exercised		-		-
Forfeited, cancelled, expired		-		-
Warrants Outstanding as of June 30, 2023		634,488	$	80.32		2.74	$	-
Warrants Vested and exercisable at June 30, 2023		634,488	$	80.32		2.74	$	-

~~GigWorld Inc. Sale of Shares~~

~~During the six months ended June 30, 2021, the Company sold~~ ~~280,000~~ ~~shares of GigWorld to international investors for the amount of $280,000, which was booked as addition paid-in capital. The Company held~~ ~~505,381,376~~ ~~shares of the total outstanding shares~~ ~~506,898,576~~ ~~before the sale. After the sale, the Company still owns approximately~~ 99~~% of GigWorld’s total outstanding shares.~~

~~During the six months ended June 30, 2021, the sales of GigWorld’s shares were de minimis compared to its outstanding shares and did not change the minority interest.~~

~~Distribution to Minority Shareholder~~

~~During the six months ended June 30, 2021, SeD Maryland Development LLC Board approved the payment distribution plan to members and paid $1,151,500~~ ~~in distribution to the minority shareholder.~~

Changes of Ownership of Alset International

In the year ended December 31, ~~2021, Alset International issued~~ ~~1,721,303,416~~ ~~common shares through warrants exercise with exercise price of approximately $0.04~~ ~~per share and received $60,300,464~~ ~~cash, which included approximately $~~58 million from Alset EHome International to exercise its warrants to purchase Alset International common shares. The warrant exercise transactions between Alset EHome International and Alset International were intercompany transactions and only affected change in non-controlling interest on the condensed consolidated statements of stockholders’ equity. During the year ended December 31, 2021, the stock-based compensation expense of Alset International was $~~73,292~~ ~~with the issuance of~~ ~~1,500,000~~ ~~shares to an officer. In six months ended June 30,~~ 2022 the Company purchased ~~6,137,900~~6,670,200 shares of Alset International from the market.

~~F-31~~

On January 17, 2022 the Company entered into a securities purchase agreement with Chan Heng Fai, pursuant to which the Company agreed to purchase from Chan Heng Fai 293,428,200 ordinary shares of Alset International for a purchase price of 29,468,977 newly issued shares of the Company’s common stock. On February 28, 2022, the Company and Chan Heng Fai entered into an amendment to this securities purchase agreement pursuant to which the Company shall purchase these 293,428,200 ordinary shares of Alset International for a purchase price of 35,319,290 newly issued shares of the Company’s common stock. The closing of this transaction with Chan Heng Fai was subject to approval of the Nasdaq and the Company’s stockholders. These 293,428,200 ordinary shares of Alset International represent approximately ~~8.4~~8.4%% of the 3,492,713,362 total issued and outstanding shares of Alset International. The Company had a Special Meeting of Stockholders to vote on the approval of this transaction on June 6, 2022.

Due to these transactions the Company’s ownership of Alset International changed from ~~76.8~~76.8%% as of December 31, 2021 to ~~85.4~~85.4%% as of June 30, 2023 and December 31, 2022.

Promissory Note Converted into Shares

On December 13, 2021 the Company entered into a Securities Purchase Agreement with Chan Heng Fai for the issuance and sale of a convertible promissory note in favor of Chan Heng Fai, in the principal amount of $6,250,000. The note bears interest of 33%% per annum and iswas due on the earlier of December 31, 2024 or when declared due and payable by Chan Heng Fai. The note ~~can~~could be converted in part or whole into common shares of the Company at the conversion price of $0.625 or into cash. The loan closed on January 26, 2022 after all closing conditions were met. Chan Heng Fai opted to convert all of the amount of such note into 10,000,000 shares of the Company’s common stock, which shares were issued on January 27, 2022.

F-29

Registration Statement on Form S-3

On April 11, 2022 the Company filed a Registration Statement on Form S-3 using a “shelf” registration or continuous offering process. Under this shelf registration process, the Company may, from time to time, sell any combination of the securities (common stock, preferred stock, warrants, rights, units) described in the filed prospectus in one or more offerings up to a total aggregate offering price of $75,000,000.

Class A Common Stock of Alset Capital Acquisition Corp. Subject to Possible Redemption

The Company accounts for its, and its subsidiaries’ common stock subject to possible redemption in accordance with the guidance enumerated in ASC 480 “Distinguishing Liabilities from Equity”. Common stock subject to possible redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable common stock (including shares of common stock that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, shares of common stock are classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered by the Company to be outside of the Company’s control and subject to the occurrence of uncertain future events. Accordingly, at June 30, 2023, the Class A common stock of Alset Capital Acquisition Corp. subject to possible redemption in the amount of $20,075,127, are presented as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets.

On May 1, 2023, after the redemptions (for further details on this transaction refer to Note 8. – Related Party Transactions, Consolidation of Alset Capital Acquisition Corp.), the Company consolidated Alset Capital. As of June 30, 2023, non-controlling interest of $(658,292) was recorded as temporary equity, since these non-controlling interests are considered redeemable noncontrolling interests in accordance with ASC 810-10 and ASC 480-10-S99-3A.

~~10.~~11. LEASE INCOME

The Company generally rents its SFRs under lease agreements with a term of one or two years. Future minimum rental revenue under existing leases on our properties at June 30, ~~2022~~2023 in each calendar year through the end of their terms are as follows:

SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS

2022 $ 871,824
2023 531,550
2024 7,450
Total Future Receipts $ 1,410,824

2023	$	1,082,873
2024		623,105
Total Future Receipts	$	1,705,978

Property Management Agreements

The Company has entered into property management agreement with the property managers under which the property managers generally oversee and direct the leasing, management and advertising of the properties in our portfolio, including collecting rents and acting as liaison with the tenants. The Company pays its property managers a monthly property management fee for each property unit and a leasing fee. For the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, property management fees incurred by the property managers were $~~20,990~~34,650 and $~~2,740~~20,990, respectively. For the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, property management fees incurred by the property managers were $~~32,015~~66,600 and $~~2,740~~32,015, respectively. For the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, leasing fees incurred by the property managers were $~~87,035~~41,745 and $~~14,475~~87,035, respectively. For the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, leasing fees incurred by the property managers were $~~112,825~~66,755 and $~~14,475~~112,825, respectively.

~~F-32~~

~~11.~~12. ACCUMULATED OTHER COMPREHENSIVE INCOME

Following is a summary of the changes in the balances of accumulated other comprehensive income, net of tax:

SCHEDULE OF CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME, NET OF TAX

Unrealized Gains and Losses on Security Investment Foreign Currency Translations Change in Minority Interest Total
Balance at January 1, 2022 $ (90,031 ) $ (367,895 ) $ 799,572 $ 341,646

Other Comprehensive Income (7,027 ) (499,967 ) 459,069 (47,925 )

Balance at March 31, 2022 $ (97,058 ) $ (867,862 ) $ 1,258,641 $ 293,721

Other Comprehensive Income (505 ) (3,002,167 ) 3,266,996 264,324

Balance at June 30, 2022 $ (97,563 ) $ (3,870,029 ) $
4,525,637
$
558,045

	Unrealized Gains and Losses on Security Investment			Foreign Currency Translations			Change in Minority Interest		Total
Balance at January 1, 2023	$	(54,921	)	$	121,272		$	3,769,712	$	3,836,063

Other Comprehensive Income		-			936,265			-		936,265

Balance at March 31, 2023	$	(54,921	)	$	1,057,537		$	3,769,712	$	4,772,328

Other Comprehensive Loss		-			(1,849,049	)		-		(1,849,049	)

Balance at June 30, 2023	$	(54,921	)	$	(791,512	)	$	3,769,712	$	2,923,279

Unrealized Gains and Losses on Security Investment Foreign Currency Translations Change in Minority Interest Total
Balance at January 1, 2021 $ (48,758 ) $ 2,258,017 $ (65,921 ) $ 2,143,338

Other Comprehensive Income (1,135 ) (1,010,527 ) (39,067 ) (1,050,729 )

Balance at March 31, 2021 $ (49,893 ) $ 1,247,490 $ (104,988 ) $ 1,092,609
Balance at Beginning $ (49,893 ) $ 1,247,490 $ (104,988 ) $ 1,092,609

Other Comprehensive Income (25,663 ) (764,544 ) (343,225 ) (1,133,432 )

Balance at June 30, 2021 $ (75,556 ) $ 482,946 $ (448,213 ) $ (40,823 )
Balance at End (75,556 ) 482,946 (448,213 ) (40,823 )

	Unrealized Gains and Losses on Security Investment			Foreign Currency Translations			Change in Minority Interest		Total
Balance at January 1, 2022	$	(90,031	)	$	(367,895	)	$	799,572	$	341,646
Balance	$	(90,031	)	$	(367,895	)	$	799,572	$	341,646

Other Comprehensive Income		(7,027	)		(499,967	)		459,069		(47,925	)

Balance at March 31, 2022	$	(97,058	)	$	(867,862	)	$	1,258,641	$	293,721
Balance	$	(97,058	)	$	(867,862	)	$	1,258,641	$	293,721

Other Comprehensive Income		(505	)		(3,002,167	)		3,266,996		264,324

Balance at June 30, 2022	$	(97,563	)	$	(3,870,029	)	$	4,525,637	$	558,045
Balance	$	(97,563	)	$	(3,870,029	)	$	4,525,637	$	558,045

F-30

~~12.~~

13. INVESTMENTS MEASURED AT FAIR VALUE

Financial assets measured at fair value on a recurring basis are summarized below and disclosed on the condensed consolidated balance sheet as of June 30, ~~2022~~2023 and December 31, ~~2021:~~2022:

SCHEDULE OF FINANCIAL ASSETS MEASURED AT FAIR VALUE ON A RECURRING BASIS

	Amount at		Fair Value Measurement Using							Amount at		Fair Value Measurement Using						Amount at
	Cost		Level 1		Level 2			Level 3		Fair Value		Level 1		Level 2		Level 3		Fair Value
June 30, 2022
June 30, 2023
Assets
Investment Securities- Fair Value	$	76,264,051	$	17,132,071	$	-		$	-	$	17,132,071	$	287,818	$	-	$	-	$	287,818
Investment Securities- Fair Value - Related Party													24,757,622		-		-		24,757,622
Investment Securities- Trading		2,387,149		3,466,845		-			-		3,466,845		6,319,406		-		-		6,319,406
Convertible Note Receivable		138,599		-		-			88,684		88,684		-		-		88,599		88,599
Warrants - American Premium Mining		-		-		-			507,062		507,062

Total	$	78,789,799	$	20,598,916	$	-	��	$	595,746	$	21,194,662

Investment Securities - Fair Value NAV as Practical Expedient											24,112
Warrants - New Electric CV Corp.													-		-		47,115		47,115

Total Investment in securities at Fair Value											21,218,774	$	31,364,846	$	-	$	135,714	$	31,500,560

~~F-33~~

	Amount at		Fair Value Measurement Using						Amount at		Fair Value Measurement Using						Amount at
	Cost		Level 1		Level 2		Level 3		Fair Value		Level 1		Level 2		Level 3		Fair Value
December 31, 2021
December 31, 2022
Assets
Investment Securities- Fair Value	$	72,000,301	$	25,320,694	$	-	$	-	$	25,320,694	$	884,432	$	-	$	-	$	884,432
Investment Securities- Fair Value - Related Party												12,865,525		-		-		12,865,525
Investment Securities- Trading		9,809,778		9,908,077		-		-		9,908,077		5,315,204		-		-		5,315,204
Convertible Note Receivable		138,599		-		-		98,398		98,398		-		-		88,599		88,599
Warrants - American Premium Mining		696,791		-		-		1,009,854		1,009,854
Warrants - AMRE		-		-		-		-		-
Warrants - New Electric CV Corp.												-		-		327,565		327,565

Total Investment in securities at Fair Value	$	82,645,469	$	35,228,771	$	-	$	1,108,252	$	36,337,023	$	19,065,161	$	-	$	416,164	$	19,481,325

Realized loss on investment securities for the six months ended June 30, ~~2022~~2023 was $~~6,355,451~~10,688,542 and realized ~~gain~~loss on investment securities for the six months ended June 30, ~~2021~~2022 was $~~296,961~~6,355,451. Unrealized loss on securities investment was $~~10,766,390~~17,652,880 and $~~30,703,914~~10,766,390 in the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. These gains and losses were recorded directly to net ~~income (loss).~~loss. The change in fair value of the convertible note receivable in the six months ended June 30, ~~2022~~2023 and ~~2021~~2022 was $~~9,714~~0 and $~~37,909~~9,123, respectively, and was recorded in condensed consolidated statements of stockholders’ equity.

F-31

For U.S. trading stocks, we use Bloomberg Market stock prices as the share prices to calculate fair value. For overseas stock, we use the stock price from the local stock exchange to calculate fair value. The following chart shows details of the fair value of equity security investment at June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively.

SCHEDULE OF FAIR VALUE OF EQUITY SECURITY INVESTMENT

	Share price				Market Value
	6/30/2023		Shares		6/30/2023		Valuation

DSS (Related Party)	$	0.359		62,812,264	$	22,549,603	Investment in Securities at Fair Value

AMBS (Related Party)	$	0.001		20,000,000	$	16,000	Investment in Securities at Fair Value

Holista (Related Party)	$	0.007		40,927,621	$	271,818	Investment in Securities at Fair Value

New Electric CV (Related Party)	$	0.001		354,039,000	$	70,808	Investment in Securities at Fair Value

Value Exchange (Related Party)	$	0.100		13,834,643	$	1,383,464	Investment in Securities at Fair Value

Sharing Services (Related Party)	$	0.006		125,624,528	$	753,747	Investment in Securities at Fair Value

Trading Stocks					$	6,319,406	Investment in Securities at Fair Value

		Total Level 1 Equity Securities			$	31,364,846
Nervotec		N/A		1,666	$	37,631	Investment in Securities at Cost
HWH World Co.		N/A		3,800	$	42,562	Investment in Securities at Cost
UBeauty		N/A		3,600	$	19,609	Investment in Securities at Cost
		Total Equity Securities			$	31,464,648

		Share price				Market Value				Share price				Market Value
		6/30/2022		Shares		6/30/2022		Valuation		12/31/2022		Shares		12/31/2022		Valuation

DSS (Related Party)		$	0.351		41,446,087	$	14,547,577	Investment in Securities at Fair Value		$	0.164		62,812,264	$	10,301,211	Investment in Securities at Fair Value

AMBS (Related Party)		$	0.002		20,000,000	$	48,000	Investment in Securities at Fair Value		$	0.002		20,000,000	$	34,000	Investment in Securities at Fair Value

Holista (Related Party)		$	0.021		43,596,621	$	931,552	Investment in Securities at Fair Value		$	0.020		42,999,621	$	850,432	Investment in Securities at Fair Value

American Premium Mining (Related Party)		$	0.001		354,039,000	$	389,443	Investment in Securities at Fair Value
New Electric CV (Related Party)										$	0.001		354,039,000	$	212,423	Investment in Securities at Fair Value

Value Exchange		$	0.187		6,500,000	$	1,215,500	Investment in Securities at Fair Value
Value Exchange (Related Party)										$	0.170		13,834,643	$	2,351,889	Investment in Securities at Fair Value

Trading Stocks						$	3,466,845	Investment in Securities at Fair Value						$	5,315,204	Investment in Securities at Fair Value

Total Level 1 Equity Securities	Total Level 1 Equity Securities					$	20,598,917		Total Level 1 Equity Securities					$	19,065,161

Nervotech			N/A		1,666	$	37,045	Investment in Securities at Cost
Hyten Global			N/A		3,800	$	42,562	Investment in Securities at Cost
Ubeauty			N/A		3,600	$	19,609	Investment in Securities at Cost
			Total Equity Securities			$	20,698,133
Nervotec											N/A		1,666	$	35,958	Investment in Securities at Cost
HWH World Co.											N/A		3,800	$	42,562	Investment in Securities at Cost
UBeauty											N/A		3,600	$	19,609	Investment in Securities at Cost
Total Equity Securities									Total Equity Securities					$	19,163,290

~~F-34~~F-32

Share price Market Value
12/31/2021 Shares 12/31/2021 Valuation

DSS (Related Party) $ 0.672 19,888,262 $ 13,364,912 Investment in Securities at Fair Value

AMBS (Related Party) $ 0.016 20,000,000 $ 328,000 Investment in Securities at Fair Value

Holista (Related Party) $ 0.034 43,626,621 $ 1,489,179 Investment in Securities at Fair Value

American Premium Mining (Related Party) $ 0.002 354,039,000 $ 778,886 Investment in Securities at Fair Value

True Partner $ 0.119 62,122,908 $ 7,409,717 Investment in Securities at Fair Value

Value Exchange $ 0.300 6,500,000 $ 1,950,000 Investment in Securities at Fair Value

Trading Stocks $ 9,908,077 Investment in Securities at Fair Value

Total Level 1 Equity Securities $ 35,228,771

Nervotech N/A 1,666 $ 37,045 Investment in Securities at Cost
Hyten Global N/A 3,800 $ 42,562 Investment in Securities at Cost
Ubeauty N/A 3,600 $ 19,609 Investment in Securities at Cost
Total Equity Securities $ 35,327,987

~~DSS convertible preferred stock~~

~~During the six months ended June 30, 2021, Global BioMedical Pte Ltd. converted~~ ~~42,575~~ ~~preferred stock of DSS into~~ ~~6,570,170~~ ~~common shares of DSS.~~

Sharing Services Convertible Note

The fair value of the Sharing Services Convertible Note under level 3 category ~~as of June 30, 2022 and December 31, 2021~~ was calculated using a Black-Scholes valuation ~~model valued with the following weighted average assumptions:~~model.

~~SCHEDULE OF SIGNIFICANT INPUTS AND ASSUMPTIONS~~

June 30,
2022

December 31,
2021

Dividend yield 0.00 % 0.00 %
Expected volatility 126.23 % 138.85 %
Risk free interest rate 3.25 % 3.25 %
Contractual term (in years) 0.51 0.76
Exercise price $ 0.15 $ 0.15

~~F-35~~

We assumed dividend yield rate isof ~~0.00~~0.00%% in Sharing Services. The volatility iswas based on the historical volatility of the Sharing Services’ common stock. Risk-free interest rates were obtained from U.S. Treasury rates for the applicable periods.

The Sharing Services Convertible Note was redeemed in July 2022.

Changes in the observable input values would likely cause material changes in the fair value of the Company’s Level 3 financial instruments. A significant increase (decrease) in this likelihood would result in a higher (lower) fair value measurement.

The table below provides a summary of the changes in fair value which are recorded as other comprehensive income (loss), including net transfers in and/or out of all financial assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three and six months ended June 30, ~~2022~~2023 and ~~2021:~~2022:

SCHEDULE OF CHANGE IN FAIR VALUE

	Total
Balance at January 1, 2023	$	327,565
Total gains		62,348
Balance at March 31, 2023	$	389,913
Total losses		(342,798	)
Balance at June 30, 2023	$	47,115

		Total
Balance at January 1, 2022	$	1,108,252
Total losses		(203,463	)
Balance at March 31, 2022	$	904,789
Total losses		(591	)
Balance at June 30, 2022	$	904,198

Total
Balance at January 1, 2022 $ 1,108,252
Total losses (203,463 )
Balance at March 31, 2022 $ 904,789
Total losses (591 )
Balance at June 30, 2022 $ 904,198

Total
Balance at January 1, 2021 $ 66,978
Total losses (1,987 )
Balance at March 31, 2021 $ 64,991
Total losses (35,922 )
Balance at June 30, 2021 $ 29,069

Vector Com Convertible Bond

On February 26, 2021, the Company invested approximately $88,599 in the convertible bond of Vector Com Co., Ltd (“Vector Com”), a private company in South Korea. The interest rate is 22%% per annum and maturity is two years. The conversion price is approximately $21.26, per common share of Vector Com. As of June 30, ~~2022,~~2023, the management estimated that the fair value of this note remained unchanged from its initial purchase price.

Warrants

On March 2, 2020 and October 29, 2021, the Company received warrants to purchase shares of AMRE, a related party private company, in conjunction with the Company lending two $200,000 promissory notes. For further details on this transaction, refer to Note 8 - Related Party Transactions, Note Receivable from a Related Party Company. As of ~~June~~September 30, 2022 and December 31, 2021, AMRE was a private company. Based the management’s analysis, the fair value of the warrants was $0 as of December 31, 2021. All warrants were converted into common shares in March 2022.

F-33

On July 17, 2020, the Company purchased 122,039,000 shares, approximately ~~9.99~~9.99%% ownership, and 1,220,390,000 warrants with an exercise price of $0.0001 per share, from ~~APM~~,NECV, for an aggregated purchase price of $122,039. During 2021, the Company exercised 232,000,000 of the warrants to purchase 232,000,000 shares of ~~APM~~NECV for the total consideration of $232,000, leaving the balance of outstanding warrants of 988,390,000 at December 31, ~~2021.~~2021 and 2022. The Company did not exercise any warrants during six months ended June 30, ~~2022.~~2023. We value ~~APB~~NECV warrants under level 3 category through a Black Scholes option pricing model and the fair value of the warrants from ~~APM~~NECV was $~~507,062~~47,115 as of June 30, ~~2022~~2023 and $~~1,009,854~~327,565 as of December 31, ~~2021.~~2022.

~~F-36~~

The fair value of the ~~APM~~NECV warrants under level 3 category as of June 30, ~~2022~~2023 and December 31, ~~2021~~2022 was calculated using a Black-Scholes valuation model valued with the following weighted average assumptions:

SCHEDULE OF SIGNIFICANT INPUTS AND ASSUMPTIONS


	June 30, 2022			December 31, 2021			June 30, 2023			December 31, 2022

Stock Price	$	0.0011		$	0.0022		$	0.0002		$	0.0006
Exercise price		0.001			0.001			0.001			0.001
Risk free interest rate		1.46	%		1.48	%		3.96	%		3.95	%
Annualized volatility		155.6	%		186.5	%		250.4	%		186.1	%
Dividend Yield								0.00			0.00
Year to maturity		8.07			8.58			7.07			7.56

~~13.~~14. COMMITMENTS AND CONTINGENCIES

Lots Sales Agreement

On November 23, 2015, SeD Maryland Development LLC completed the $15,700,000 acquisition of Ballenger Run, a 197-acre land sub-division development located in Frederick County, Maryland. Previously, on May 28, 2014, the RBG Family, LLC entered into a $15,000,000 assignable real estate sales contract with NVR, by which RBG Family, LLC would facilitate the sale of the 197 acres of Ballenger Run to NVR. On December 10, 2014, NVR assigned this contract to SeD Maryland Development, LLC through execution of an assignment and assumption agreement and entered into a series of lot purchase agreements by which NVR would purchase 443 subdivided residential lots from SeD Maryland Development, LLC. On December 31, 2018, SeD Maryland entered into the Third Amendment to the Lot Purchase Agreement for Ballenger Run with NVR. Pursuant to the Third Amendment, SeD Maryland will convert the 5.9 acre CCRC parcel to 36 lots (the 28 feet wide villa lot) and sell to NVR. SeD Maryland pursued the required zoning approval to change the number of such lots from 85 to 121, which was approved in July 2019. Subsequently, SeD Maryland Development signed Fourth Amendment to the Lot Purchase Agreement, pursuant to which NVR agreed to purchase all of the new 121 lots.

During the three months ended on June 30, ~~2022~~2023 and ~~2021,~~2022, NVR purchased 0 ~~and~~ 31 ~~lots, respectively.~~lots. During the six months ended on June 30, ~~2022~~2023 and ~~2021,~~2022, NVR purchased 30 and 583 lots, respectively. Through June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, NVR had purchased a total of 3479 ~~and~~ ~~476~~ ~~lots, respectively.~~lots.

Certain arrangements for the sale of buildable lots to NVR require the Company to credit NVR with an amount equal to one year of the FFB assessment. Under ASC 606, the credits to NVR are not in exchange for a distinct good or service and accordingly, the amount of the credit was recognized as the reduction of revenue. As of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the accrued balance due to NVR was $189,475~~and $188,125, respectively.~~.

Leases

The Company leases offices in Bethesda, Maryland, ~~Singapore,~~ Magnolia, Texas, Singapore, Hong Kong, ~~and~~ South Korea and China through leased spaces aggregating approximately ~~15,811~~30,000 square feet, under leases expiring on various dates from ~~August 2022~~November 2023 to March ~~2024.~~2027. The leases have rental rates ranging from $~~2,300~~1,401 to $~~21,500~~23,020 per month. Our total rent expense under these office leases was $~~156,470~~266,103 and $~~140,271~~156,575 in the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. Our total rent expense under these office leases was $~~312,940~~525,781 and $~~272,985~~313,150 in the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. The following table outlines the details of lease terms:

SCHEDULE OF OPERATING AND RENEWED LEASE TERMS RENTAL

Office Location		Lease Term as of December 31, 2021
Singapore - AI		June ~~2022~~2023 to May ~~2023~~2026
Singapore – F&B		October 2021 to October 2024
Singapore – Four Seasons Park		July 2022 to July 2024
Singapore – Hapi Cafe		July 2022 to June 2024
Singapore - PLQ		December 2022 to July 2024
Hong Kong - Office		October ~~2020~~2022 to October 2024
Hong Kong - Warehouse		November 2022 to October 2024
Hong Kong - Shop		October 2022 to September 2024
South Korea – Hapi Cafe		August ~~2020~~2022 to August 2025
South Korea – HWH World		August 2022 to July 2025
Magnolia, Texas ~~USA~~		May 2022 ~~- on month to month basis~~– January 2023
Bethesda, Maryland ~~USA~~		January 2021 to March 2024
China - Cafe		December 2022 - November 2023
China - Office		March 2023 – March 2027

~~F-37~~F-34

The Company adopted ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”) to recognize a right-of-use asset and a lease liability for all the leases with terms greater than twelve months. We elected the practical expedient to not recognize operating lease right-of-use assets and operating lease liabilities for lease agreements with terms less than 12 months. Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As our leases do not provide a readily determinable implicit rates, we estimate our incremental borrowing rates to discount the lease payments based on information available at lease commencement. Our incremental borrowings rates are at a range from 0.35% to 3.9% in ~~2022~~2023 and ~~2021,~~2022, which were used as the discount rates. The balances of operating lease right-of-use assets and operating lease liabilities as of June 30, ~~2022~~2023 were $~~479,528~~1,805,482 and $~~484,682~~1,834,289 respectively. The balances of operating lease right-of-use assets and operating lease liabilities as of December 31, ~~2021~~2022 were $~~659,620~~1,614,159 and $~~667,343~~1,628,039, respectively.

The table below summarizes future payments due under these leases as of June 30, ~~2022.~~2023.

For the Years Ended June 30:

SCHEDULE OF LEASE PAYMENTS



2023		320,414
2024		162,852		$	1,064,127
2025		18,199			589,037
2026					220,887
2027					29,433
Total Minimum Lease Payments		501,465		$	1,903,485
Less: Effect of Discounting		(16,783	)		(69,196	)
Present Value of Future Minimum Lease Payments		484,682			1,834,289
Less: Current Obligations under Leases		(180,524	)		(186,380	)
Long-term Lease Obligations	$	304,158		$	1,647,909

~~14.~~Agreement to Sell 189 Lots

On March 17, 2023, 150 CCM Black Oak (the “Seller”) entered into a Contract of Sale (the “Contract of Sale”) with Davidson Homes, LLC, an Alabama limited liability company (“Davidson Homes”). Pursuant to the terms of the Contract of Sale, the Seller has agreed to sell approximately 189 single-family detached residential lots comprising an additional section of the Lakes at Black Oak. The price of the lots and certain community enhancement fees the Seller will be entitled to receive are anticipated to equal an aggregate of $10,022,500.

The closing of the transactions described in the Contract of Sale depends on the satisfaction of certain conditions set forth therein. There can be no assurance that such closings will be completed on the terms outlined herein or at all. Davidson Homes has agreed to purchase the lots in stages, comprising an initial closing of 94 lots, the remaining lots to be purchased on or before December 29, 2023. Commencing on March 17, 2023, Davidson Homes had a thirty (30) day inspection period in which to inspect the properties and determine their suitability; during such inspection period, Davidson Homes was entitled to decline to proceed with the closing of these transactions. Davidson Homes did not exercise its right to decline, and pursuant to the Contract of Sale, has made an additional deposit in escrow. Through the date hereof, Davidson Homes has deposited $1,425,000 in escrow. On May 30, 2023 the sale of 94 lots closed and the Company received approximately $5 million.

The Seller shall be required to complete certain improvements at the property at the Seller’s cost prior to the closing of the remaining lots.

Security Deposits

Our rental-home lease agreements require tenants to provide a one-month security deposits. The property management company collects all security deposits and maintains them in a trust account. The Company also has obligation to refund these deposits to the renters at the time of lease termination. As of June 30, 2023 and December 31, 2022, the security deposits held in the trust account were $305,255 and $271,480, respectively.

F-35

15. DIRECTORS AND EMPLOYEES’ BENEFITS

AEI Stock Option plans ~~AEI~~

~~The Company previously reserved~~Under our 2018 Incentive Compensation Plan (the “Plan”), adopted by our board of directors and holders of a majority of our outstanding shares of common stock in September 2018, ~~500,000~~25,000 shares of common stock (subject to certain adjustments) were reserved for issuance upon exercise of stock options and grants of other equity awards. No options or other equity awards have been granted under the Incentive Compensation Plan for high-quality executives and other employees, officers, directors, consultants and other persons who provide services to the Company or its related entities. This plan is meant to enable such persons to acquire or increase a proprietary interest in the Company in order to strengthen the mutuality of interests between such persons and the Company’s shareholders, and providing such persons with performance incentives to expand their maximum efforts in the creation of shareholder value. As of June 30, 2022 and December 31, 2021, there have been no options granted.Plan. The reservation of shares under the Incentive Compensation Plan was cancelled in May of 2021.

Alset International Stock Option plans

On November 20, 2013, Alset International approved a Stock Option Plan (the “2013 Plan”). Employees, executive directors, and non-executive directors (including the independent directors) are eligible to participate in the 2013 Plan.

The following tables summarize stock option activity under the 2013 Plan for the ~~six~~three months ended June 30, ~~2022:~~2023:

SCHEDULE OF OPTION ACTIVITY

	Options for Common Shares		Exercise Price		Remaining Contractual Term (Years)		Aggregate Intrinsic Value		Options for Common Shares		Exercise Price		Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding as of January 1, 2021		1,061,333	$	0.09		3.00	$	-
Vested and exercisable at January 1, 2021		1,061,333	$	0.09		3.00	$	-
Outstanding as of January 1, 2022										1,061,333	$	0.09		2.00	$	-
Vested and exercisable at January 1, 2022										1,061,333	$	0.09		2.00	$	-
Granted		-		-						-		-
Exercised		-		-						-		-
Forfeited, cancelled, expired		-		-						-		-
Outstanding as of December 31, 2021		1,061,333	$	0.09		2.00	$	-
Vested and exercisable at December 31, 2021		1,061,333	$	0.09		2.00	$	-
Outstanding as of December 31, 2022										1,061,333	$	0.09		1.00	$	-
Vested and exercisable at December 31, 2022										1,061,333	$	0.09		1.00	$	-
Granted		-		-						-		-
Exercised		-		-						-		-
Forfeited, cancelled, expired		-		-						-		-
Outstanding as of June 30, 2022		1,061,333	$	0.09		1.50	$	-
Vested and exercisable at June 30, 2022		1,061,333	$	0.09		1.50	$	-
Outstanding as of June 30, 2023										1,061,333	$	0.09		0.50	$	-
Vested and exercisable at June 30, 2023										1,061,333	$	0.09		0.50	$	-

~~15.~~16. SUBSEQUENT EVENTS

On ~~July 12, 2022,~~August 1, 2023, Alset Capital held a Special Meeting of Stockholders. In connection with this Special Meeting, Alset Capital’s business combination with HWH International ~~Limited (“AIL”), entered into Amendment No. 1 (the “First Amendment”)~~Inc. was approved by its stockholders and certain amendments to Alset Capital’s Amended and Restated Certification of Incorporation were also approved. The business combination is planned to close during the third quarter of 2023, subject to the Assignment and Assumption Agreement originally entered into on February 25, 2022 (the “Assumption Agreement”) with DSS, Inc. (“DSS”). Pursuant to the Assumption Agreement, DSS agreed to purchase a convertible promissory note with the face valuecompletion of $~~8,350,000~~ ~~together with accrued interest from AIL (the “Note”) for a purchase price of~~ ~~21,366,177~~ shares of DSS’s common stock, subject to adjustment in the event that the transaction closed after May 15, 2022. The Note was issued by American Medical REIT, Inc. (“AMRE”), pursuant to a subscription agreement, dated as of October 29, 2021 between AIL and AMRE. The First Amendment revised the Assumption Agreement to remove the adjustment provision. On July 12, 2022, the transactions contemplated by the Assumption Agreement and the First Amendment were consummated, AIL assigned the Note to DSS, and DSS issued to AIL ~~21,366,177~~ ~~shares of DSS’s common stock.~~certain closing conditions.

~~F-38~~F-36

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This Form 10-Q contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements contained in this Form 10-Q that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as “may”, “will”, “expect”, “believe”, “anticipate”, “estimate” or “continue” or comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties, and actual results may differ materially depending on a variety of factors, many of which are not within our control. These factors include by are not limited to economic conditions generally and in the industries in which we may participate, competition within our chosen industry, including competition from much larger competitors, technological advances and failure to successfully develop business relationships.

Business Overview

We are a diversified holding company principally engaged through our subsidiaries in the development of EHome communities and other real estate, financial services, digital transformation technologies, biohealth activities and consumer products with operations in the United States, Singapore, Hong Kong, Australia and South Korea. We manage a significant portion of our ~~principal~~ businesses ~~primarily~~ through our 85.4% owned subsidiary, Alset International Limited, a public company traded on the Singapore Stock Exchange. Through this subsidiary (and indirectly, through other public and private U.S. and Asian subsidiaries), we are actively developing real estate projects near Houston, Texas and in Frederick, Maryland, in our real estate segment. Recently, the Company expanded its real estate portfolio to single family rental homes, and we currently own 112 homes that are rented or are available for rent. We have designed applications for enterprise messaging and e-commerce software platforms in the United States and Asia inIn our digital transformation technology ~~business unit.~~segment, we focus on serving business-to-business (B2B) needs in e-commerce, collaboration and social networking functions. Our biohealth segment includes the sale of consumer products.

AsWe also have ownership interests outside of ~~June 30, 2022, additional interests we held, both directly and indirectly, included~~Alset International, including a ~~41.3%~~36.9% equity interest in American Pacific Bancorp Inc., ~~a 15.8%~~an indirect 14.7% equity interest in Holista CollTech Limited, a ~~45.2%~~44.8% equity interest in DSS Inc. (“DSS”), ~~an 18%~~a 38.3% equity interest in Value Exchange International, Inc., a ~~0.8%~~0.5% equity interest in ~~American~~New Electric CV Corporation (“NECV” formerly known as “American Premium Mining ~~Corporation.~~Corporation” or “APM,” and earlier known as “American Premium Water Corp.”), and an33.4% equity interest in ~~Alset Capital Acquisition~~Sharing Services Global Corp. (“~~Alset Capital”~~SHRG”). American Pacific Bancorp Inc. is a financial network holding company. Holista CollTech Limited is a public Australian company that produces natural food ingredients (ASX: HCT). DSS is a multinational company operating businesses within nine divisions: product packaging, biotechnology, ~~direct~~consumer marketing, commercial lending, securities and investment management, alternative trading, ~~digital transformation,~~ secure living, and alternative energy. DSS Inc. is listed on the NYSE American (NYSE: DSS). Value Exchange International, Inc. is a provider of information technology services for businesses, and is traded on the OTCQB (OTCQB: VEII). ~~American Premium Mining Corporation~~NECV is a publicly traded consumer products company ~~that is engaged in crypto-mining~~ (OTCPK: HIPH). ~~Alset Capital~~SHRG markets and distributes health and wellness products, as well as member-based travel services, using a direct selling business model. SHRG is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses and is listedtraded on the ~~Nasdaq (Nasdaq: ACAXU, ACAX, ACAXW and ACAXR)~~OTCQB (OTCQB: SHRG).

We generally acquire majority and/or control stakes in innovative and promising businesses that are expected to appreciate in value over time. Our emphasis is on building businesses in industries where our management team has in-depth knowledge and experience, or where our management can provide value by advising on new markets and expansion. We have at times provided a range of global capital and management services to these companies in order to gain access to Asian markets. We have historically favored businesses that improve an individual’s quality of life or that improve the efficiency of businesses through technology in various industries. We believe our capital and management services provide us with a competitive advantage in the selection of strategic acquisitions, which creates and adds value for our company and our stockholders.

Recent Developments

~~Sale of Securities of True Partner Limited~~

On January 18, 2022, the Company entered into a stock purchase agreement with DSS, Inc., pursuant to which the Company agreed to sell, through the transfer of subsidiary and otherwise, 62,122,908 shares of stock of True Partner Capital Holding Limited in exchange for 11,397,080 shares of the common stock of DSS. On February 28, 2022 the Company entered into a revised Stock Purchase Agreement with DSS, Inc., pursuant to which the Company has agreed to replace the January 18, 2022 agreement with a new agreement to sell a subsidiary holding 44,808,908 shares of stock of True Partner Capital Holding Limited, together with an additional 17,314,000 shares of True Partner Capital Holding Limited (for a total of 62,122,908 shares, representing all of our shares in such entity) in exchange for 17,570,948 shares of common stock of DSS (the “DSS Shares”). The issuance of the DSS Shares was subject to the approval of the NYSE American (on which the common stock of DSS is listed) and DSS’s shareholders. The shareholders of DSS approved this transaction on May 17, 2022, and the transaction subsequently closed.

~~Purchase of Shares of DSS~~

On January 25, 2022, the Company agreed to purchase 44,619,423 shares of DSS’s common stock for a purchase price of $0.3810 per share, for an aggregate purchase price of $17,000,000. On February 28, 2022, the Company and DSS agreed to amend this stock purchase agreement. The number of shares of the common stock of DSS that the Company agreed to purchase was reduced to 3,986,877 shares for an aggregate purchase price of $1,519,000. Such acquisition of shares of DSS closed on March 9, 2022.

~~Sale of Note to DSS~~

~~On February 25, 2022, Alset International entered into an assignment and assumption agreement with DSS~~ (the “Assumption Agreement”) pursuant to which DSS agreed to purchase a convertible promissory note from Alset International. The note has a principal amount of $8,350,000 and had accrued but unpaid interest of $367,400 through May 15, 2022. The note was issued by American Medical REIT, Inc. The consideration paid for the note was 21,366,177 shares of DSS’s common stock. The number of DSS shares issued as consideration was calculated by dividing $8,717,400, the aggregate of the principal amount and the accrued but unpaid interest under the Note, by $0.408 per share. The closing of the Assumption Agreement and the issuance of the DSS shares described above was subject to the approval of the NYSE American and DSS’s shareholders. The shareholders of DSS approved this transaction on May 17, 2022. On July 12, 2022, Alset International entered into Amendment No. 1 to the Assumption Agreement. Amendment No. 1 revised the Assumption Agreement to remove an adjustment provision. On July 12, 2022, the transactions contemplated by the Assumption Agreement and Amendment No. 1 were consummated, Alset International assigned the Note to DSS, and DSS issued to Alset International 21,366,177 shares of DSS’s common stock.

~~Purchase of Alset International shares~~

On January 17, 2022 the Company entered into a securities purchase agreement with Chan Heng Fai, pursuant to which the Company agreed to purchase from Chan Heng Fai 293,428,200 ordinary shares of Alset International for a purchase price of 29,468,977 newly issued shares of the Company’s common stock. On February 28, 2022, the Company and Chan Heng Fai entered into an amendment to this securities purchase agreement pursuant to which the Company shall purchase these 293,428,200 ordinary shares of Alset International for a purchase price of 35,319,290 newly issued shares of the Company’s common stock. The closing of this transaction with Mr. Chan is subject to approval of the Nasdaq and the Company’s stockholders. These 293,428,200 ordinary shares of Alset International represent approximately 8.4% of the 3,492,713,362 total issued and outstanding shares of Alset International. The Company had a Special Meeting of Stockholders to vote on the approval of this transaction on June 6, 2022.

~~Initial Public Offering of~~ Alset Capital Acquisition Corp.

On February 3, 2022 Alset Capital Acquisition Corp. (“Alset Capital”), a special purpose acquisition company sponsored by the Company and certain affiliates, closed its initial public offering of 7,500,000 units at $10 per unit. Each unit consisted of one of Alset Capital’s shares of Class A common stock, one-half of one redeemable warrant and one right to receive one-tenth of one share of Class A common stock upon the consummation of an initial business combination. Each whole warrant entitles the holder thereof to purchase one share of Class A common stock at a price of $11.50 per share. Only whole warrants are exercisable. The underwriters exercised their over-allotment option in full for an additional 1,125,000 units on February 1, 2022, which closed at the time of the closing of the Offering. As a result, the aggregate gross proceeds of this offering, including the over-allotment, were $86,250,000, prior to deducting underwriting discounts, commissions, and other offering expenses.

On February 3, 2022, simultaneously with the consummation of Alset Capital’s initial public offering, Alset Capital consummated the private placement of 473,750 units (the “Private Placement Units”) to the Sponsor, which amount includes 33,750 Private Placement Units purchased by the Sponsor in connection with the underwriters’ exercise of the over-allotment option in full, at a price of $10.00 per Private Placement Unit, generating gross proceeds of approximately $4.7 million (the “Private Placement”) the proceeds of which were placed in the trust account. No underwriting discounts or commissions were paid with respect to the Private Placement. The Private Placement Units are identical to the units sold in the initial public offering, except that (a) the Private Placement Units and their component securities will not be transferable, assignable or saleable until 30 days after the consummation of Alset Capital’s initial business combination except to permitted transferees and (b) the warrants and rights included as a component of the Private Placement Units, so long as they are held by the Sponsor or its permitted transferees, will be entitled to registration rights, respectively.

The Company and its majority-owned subsidiary Alset International ~~each~~together own ~~45% of~~ the sole member of Alset Acquisition Sponsor, LLC, the sponsor of Alset Capital, with the remaining 10% of the sole member of the sponsor owned by Alset Investment Pte. Ltd., a company owned by the Company’s Chairman, Chief Executive Officer and largest stockholder, Chan Heng Fai.Capital.

On September 9, 2022, Alset Capital entered into an agreement and plan of merger (the “Merger Agreement”) by and among Alset Capital, HWH International Inc., a Nevada corporation (“HWH”) and HWH Merger Sub Inc., a Nevada corporation and a wholly owned subsidiary of Alset Capital (“Merger Sub”). Pursuant to the Merger Agreement, a business combination between Alset Capital and HWH will be effected through the merger of Merger Sub with and into HWH, with HWH surviving the merger as a wholly owned subsidiary of Alset Capital (the “Merger”). HWH is an indirect subsidiary of the Company through its subsidiary Alset International Limited. The Merger has not closed as of the date of this Report and is subject to the receipt of the required approval by the stockholders of Alset Capital, the shareholder of HWH and the satisfaction of certain other customary closing conditions.

On May 1, 2023, Alset Capital amended its Investment Management Trust Agreement with Wilmington Trust, National Association, a national banking association, which was entered into on January 31, 2022. The Trust Agreement is now amended, in part, so that Alset Capital’s ability to complete a business combination may be extended in additional increments of one month up to a total of twenty-one (21) additional months from the closing date of its initial public offering, subject to the payment into the trust account by Alset Capital of one-third of 1% of the funds remaining in the trust account following any redemptions in connection with the approval of the amendment to Alset Capital’s Amended and Restated Certificate of Incorporation.

As approved by its stockholders at the Special Meeting of Stockholders held on May 1, 2023 (the “Alset Capital Special Meeting”), Alset Capital filed an amendment to its Amended and Restated Certificate of Incorporation with the Delaware Secretary of State on May 2, 2023, to (i) give Alset Capital the right to extend the date by which it has to consummate a business combination from May 3, 2023, to November 3, 2023, on a month-to-month basis; and (ii) expand the methods that it may employ to not become subject to the “penny stock” rules of the Securities and Exchange Commission.

In connection with the Alset Capital Special Meeting, 6,648,964 shares of the Class A Common Stock of Alset Capital were tendered for redemption. Following this redemption, 2,449,786 shares of the Class A Common Stock of Alset Capital remained issued and outstanding, including 473,750 shares held by Alset Acquisition Sponsor, LLC and 1,976,036 public shares. Alset Acquisition Sponsor, LLC owns 2,156,250 shares of Class B Common Stock.

Name Change

During a Special Meeting of Stockholders on June 6, 2022, the stockholders approved the reincorporation of the Company in Texas and the change of the Company’s name to “Alset Inc.” The management believes that such new name will more fully reflect its current business model.

~~Financial Impact~~Purchase of ~~the COVID-19 Pandemic~~Rental Business from Majority-Owned Subsidiary

~~Real Estate Projects~~On December 9, 2022, Alset Inc. entered into an agreement with Alset EHome Inc. and Alset International Limited pursuant to which Alset Inc. agreed to reorganize the ownership of its home rental business. Previously, Alset Inc. and certain majority-owned subsidiaries collectively owned 132 single-family rental homes in Texas. 112 of these rental homes are owned by subsidiaries of American Home REIT Inc. (“AHR”). Alset Inc. owns 85.4% of Alset International Limited, and Alset International Limited indirectly owns approximately 99.9% of Alset EHome Inc.

The extent to which the COVID-19 pandemic may impact our business will depend on future developments, which are highly uncertain and cannot be predicted. The COVID-19 pandemic’s far-reaching impact on the global economy could negatively affect various aspects of our business, including demand for real estate. From March 2020 through the second quarter of 2022, we continued to sell lots at our Ballenger Run project (in Maryland) to NVR for the construction of single-family homes. At this time, allclosing of the ~~lots at Ballenger Run have been sold~~transaction contemplated by this agreement was completed on January 13, 2023. Pursuant to ~~NVR, however we continue to complete our development requirements under our agreements with NVR. We do not anticipate~~this agreement, Alset Inc. has become the direct owner of AHR and its subsidiaries that ~~the COVID-19 pandemic will have a material impact on the timing~~collectively own these 112 homes, instead of ~~the completion of our remaining tasks at Ballenger Run.~~such homes being owned indirectly through Alset International Limited’s subsidiaries.

We have received strong indications that buyers and renters across the country are expressing interest in moving from more densely populated urban areas to the suburbs. We believe this trend, should it continue, will encourage interest in our Lakes at Black Oak project, an Alset EHome ~~community.~~Inc. sold AHR to Alset Inc. for a total consideration of $26,250,933, including the forgiveness of debt in the amount of $13,900,000, a promissory note in the amount of $11,350,933 and a cash payment of $1,000,000. This purchase price represents the book value of AHR as of November 30, 2022.

The ~~COVID-19 pandemic could impact~~closing of this transaction was approved by the ~~ability~~shareholders of Alset International Limited and the transaction was closed on January 13, 2023. Certain members of Alset Inc.’s Board of Directors and management are also members of the Board of Directors and management of each of Alset International Limited and Alset EHome Inc.

Public Offering

On February 6, 2023, we entered into an Underwriting Agreement (the “Underwriting Agreement”) in connection with an offering (the “Offering”) of our ~~staff and contractors~~common stock, par value $0.001 per share (the “Common Stock”), with Aegis Capital Corp. (the “Underwriter”) as the underwriter, relating to ~~continue~~an underwritten public offering of 1,727,273 shares of Common Stock at a public offering price of $2.20 per share. The Underwriting Agreement provides the Underwriter a 45-day option to ~~work, and our ability~~purchase up to ~~conduct our operations in a prompt and efficient manner. In 2020, we experienced a slowdown in the construction~~an additional 212,863 shares of a clubhouse at the Ballenger Run project, which was completed behind schedule. We believe this delay was caused in part by policies requiring lower numbers of contractors working in indoor space. The infrastructure design, engineering and construction for the Black Oak project, and other planned projects, could be impacted by the COVID-19 pandemic in the future. In addition, we believe the COVID-19 pandemic could continueCommon Stock to ~~have an impact on supply chains and commodities in the future, which may impact our real estate business by causing increased costs and longer project durations.~~cover over-allotments, if any.

The ~~COVID-19 pandemic may adversely impact~~net proceeds to the ~~timeliness~~Company from the Offering were approximately $3.3 million, after deducting underwriting discounts and the payment of ~~local government in granting required approvals. Accordingly,~~other offering expenses associated with the ~~COVID-19 pandemic may cause~~Offering that are payable by the ~~completion of important stages in our real estate projects to be delayed.~~

~~Other Business Activities~~Company.

The ~~COVID-19 pandemic may adversely impact our potential~~Offering closed on February 8, 2023. The Common Stock was being offered pursuant to ~~expand our business activities~~an effective registration statement on Form S-3 (File No. 333-264234), as well as a prospectus supplement in ~~ways that are difficult to assess or predict. The COVID-19 pandemic continues to evolve. The COVID-19 pandemic has impacted,~~connection with the Offering filed with the Securities and may continue to impact, the global supply of certain goods and services in ways that may impact the sale of products to consumers that we, or companies we may invest in or partner with, will attempt to make. The COVID-19 pandemic may prevent us from pursuing otherwise attractive opportunities.

COVID-19 pandemic has impacted our operations in South Korea; since the start of the pandemic, the South Korean government has at various times placed certain restrictions on business meetings to reduce the spread of COVID-19. Such restrictions have impacted our ability to recruit potential affiliate sales personnel, and to introduce products to a larger audience.Exchange Commission.

Purchase of Travel Business

On June 14, 2023, Hotapp Blockchain Pte. Ltd., (“Hotapp”) a wholly owned subsidiary of Hapi Metaverse Inc., a majority owned subsidiary of the Company, entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) in connection with its purchase of all of the outstanding shares of Hapi Travel Limited, a Hong Kong corporation, from Business Mobile Intelligence Inc. (“BMI”) for a total consideration of $214,993 (the “Purchase Price”). In order to facilitate the Stock Purchase Agreement, Hapi Metaverse made a loan (the “Loan”) in an amount equal to the Purchase Price to Hotapp. Chan Heng Fai, the chairman of the Company, is also Chairman of Hotapp and the sole stockholder of BMI, and therefore recused himself from any deliberation or voting regarding the Stock Purchase Agreement and the Loan.

Purchase of Sentinel Brokers Company Inc. Shares

~~Impact~~On May 22, 2023 the Company’s indirect subsidiary, SeD Capital Pte Ltd (“SeD Capital”), entered into a Stock Purchase Agreement, pursuant to which SeD Capital purchased 39.8 shares (19.9%) of the Common Stock of Sentinel Brokers Company Inc. (“Sentinel”) for the aggregate purchase price of $279,719. Sentinel is a broker-dealer operating primarily as a fiduciary intermediary, facilitating institutional trading of municipal and corporate bonds as well as preferred stock, and is registered with the Securities and Exchange Commission, is a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”), and is a member of the Securities Investor Protection Corporation (“SIPC”). The Company has significant influence over Sentinel and its CEO holds a director position on ~~Staff~~Sentinel’s Board of Directors.

Sale of Certain Lots

Sale of 131 Lots

~~Most~~On October 28, 2022, 150 CCM Black Oak Ltd. (the “Seller”), a Texas Limited Partnership and an indirect, majority-owned subsidiary of ~~our U.S. staff works out~~the Company, entered into a Contract for Purchase and Sale and Escrow Instructions (the “Agreement”) with Century Land Holdings of ~~our Bethesda, Maryland office.~~Texas, LLC, a Colorado limited liability company (the “Buyer”). Pursuant to the terms of the Agreement, the Seller agreed to sell all of the approximately 242 single-family detached residential lots comprising a residential community in the city of Magnolia, Texas known as the “Lakes at Black Oak.”

Our U.S. staff has shifted to mostly working from home since March 2020, but this has had a minimal impact on our operations to date. Our staff in Singapore and Hong Kong has been able to work from home when needed with minimal impact on our operations, however our staff’s ability to travel between our Hong Kong and Singapore offices and our staff’s travel betweenOn November 28, 2022, the ~~U.S. and non-U.S. offices was significantly limited until earlier this year. The COVID-19 pandemic also impacted the frequency with which our management would otherwise travel~~parties to the ~~Black Oak project in 2020~~Agreement entered into an amendment to the Agreement, pursuant to which the Seller agreed to sell approximately 131 lots instead of 242 lots, and ~~2021; however, we have a contractor in Texas providing supervision of~~ the project. Management continues to regularly supervise the Ballenger Run project. Limitations on the mobility of our management and staff may slow down our ability to enter into new transactions and expand existing projects.anticipated purchase price was reduced.

~~We have not reduced our staff in connection with~~On April 13, 2023, the ~~COVID-19 pandemic. To date, we did not have to expend significant resources related to employee health and safety matters related to~~sale of the ~~COVID-19 pandemic. We have a small staff, however,~~131 lots was completed and the ~~inability~~Seller received a total consideration of ~~any significant number of our staff to work due to illness or~~$6,615,500 from the ~~illness of a family member could adversely impact our operations.~~

~~Recent Business Developments in our Home Rental Business~~

Recently, the Company expanded its real estate portfolio to single family rental houses. During 2021 and early 2022, the Company, through its subsidiaries, acquired 112 homes in Montgomery and Harris Counties, Texas.

In forty-four of the 112 rental homes that were acquired, as part of our commitment to advancing smart and healthy sustainable living, we have installed Tesla PV solar panels and Powerwalls. We are reviewing plans to add solar panels and related technologies at the balance of the single-family rental homes, where feasible. In addition, we have added technologies at many of the single-family rental homes such as (i) smart solar, thermostat, and energy usage controls; (ii) smart lighting controls; (iii) smart locks and security; and (iv) smart home automation devices. We believe these and other technologies will be attractive to renters and we continue to build and pursue strategic, technological partnerships that will assist us as we expand our real estate business to include building homes for rent and building homes for sale in the future.Buyer.

The ~~Company has~~Seller was required to develop and improve the property at the Seller’s cost pursuant to certain development plans and government regulations prior to the closing described above.

Agreement to Sell 110 Lots

On March 16, 2023, 150 CCM Black Oak Ltd. (the “Seller”) entered into a ~~property management agreement~~Purchase and Sale Agreement (the “Purchase and Sale Agreement”) with Rausch Coleman Homes Houston, LLC, a Texas limited liability company (“Rausch Coleman”). Pursuant to the ~~property managers under which the property managers generally oversee and direct the leasing, management and advertising~~terms of the ~~properties in~~Purchase and Sale Agreement, the Seller has agreed to sell approximately 110 single-family detached residential lots which comprise a section of the Lakes at Black Oak. The transaction closed on May 15, 2023.

Agreement to Sell 189 Lots

Purchase of Value Exchange International, Inc. Shares

On October 17, 2022, our ~~portfolio, including collecting rents~~majority-owned subsidiary Hapi Metaverse entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with Chan Heng Fai, who is the Chairman of Hapi Metaverse’s Board of Directors and ~~acting as liaison with~~ the ~~tenants. The Company pays its property managers~~Chairman, Chief Executive Officer and largest stockholder of Alset Inc. Pursuant to the Stock Purchase Agreement, Hapi Metaverse bought an aggregate of 7,276,163 shares of Value Exchange International Inc. (“VEII”) for the following purchase prices: (i) $1,733,079 for 7,221,163 shares, representing a ~~monthly property management fee~~price of $0.24 per ~~property unit~~share; (ii) $2,314 for 10,000 shares, representing a price of $0.2314 per share; (iii) $5,015 for 25,000 shares, representing a price of $0.2006 per share; and (iv) $3,326 for 20,000 shares, representing a ~~leasing fee.~~price of $0.1663 per share. Collectively, these purchases represent an aggregate purchase price of $1,743,734 for 7,276,163 shares of VEII. Such purchase prices were negotiated between the parties to the Stock Purchase Agreement.

Mr. Chan and another member of the Board of Directors of Hapi Metaverse, Lum Kan Fai Vincent, are both members of the Board of Directors of VEII. In addition to Mr. Chan, two other members of the Board of Directors of Alset Inc. are also members of the Board of Directors of VEII (Mr. Wong Shui Yeung and Mr. Wong Tat Keung).

Matters that May or Are Currently Affecting Our Business

In addition to the matters described above, the primary challenges and trends that could affect or are affecting our financial results include:

● Our ability to improve our revenue through cross-selling and revenue-sharing arrangements among our diverse group of companies;

● Our ability to identify complementary businesses for acquisition, obtain additional financing for these acquisitions, if and when needed, and profitably integrate them into our existing operation;

● Our ability to attract competent, skilled technical and sales personnel for each of our businesses at acceptable compensation levels to manage our overhead; and

● Our ability to control our operating expenses as we expand each of our businesses and product and service offerings.

Results of Operations

Summary of Statements of Operations for the Three and Six Months Ended June 30, ~~2022~~2023 and ~~2021~~2022

Three- Months Ended Six-months Ended

June 30, 2023

June 30, 2022

June 30, 2023

June 30, 2022

Revenue $ 19,153,848 $ 926,340 $ 20,080,784 $ 2,878,577
Operating Expenses $ 14,044,352 $ 2,580,602 $ 17,061,018 $ 6,186,380
Other Expenses $ 10,922,902 $ 8,328,599 $ 13,156,354 $ 14,383,397
Net Loss $ 5,813,406 $ 9,982,861 $ 10,136,588 $ 17,913,314
Three- Months Ended Six-months Ended

June 30,
2022

June 30,
2021

June 30,
2022

June 30,
2021

Revenue $ 926,340 $ 6,543,432 $ 2,878,577 $ 12,150,346
Operating Expenses $ 2,580,602 $ 11,219,462 $ 6,186,380 $ 17,232,634
Other Expenses $ 8,328,599 $ 70,212,030 $ 14,383,397 $ 79,161,996
Net Loss $ 9,982,861 $ 74,889,324 $ 17,913,314 $ 84,696,885
7
Revenue

The following tables set forth period-over-period changes in revenue for each of our reporting segments:

Three Months Ended
June 30,
Change Three-months Ended Change
2022 2021 Dollars Percentage June 30, 2023 June 30, 2022 Dollars Percentage
Real Estate $ 650,810 $ 4,584,542 $ (3,933,732 ) -86 % $ 18,881,917 $ 650,810 $ 18,231,107 2,801 %
Biohealth 132,222 1,958,890 (1,826,668 ) -93 % - 132,222 (132,222 ) -100 %
Digital Transformation Technology 7,701 - 7,701 100 % 14,034 7,701 6,333 82 %
Other 135,607 - 135,607 100 % 257,897 135,607 122,290 90 %
Total revenue $ 926,340 $ 6,543,432 $ (5,617,092 ) -86 %
Total Revenue $ 19,153,848 $ 926,340 $ 18,227,508 1,968 %

Six Months Ended
June 30,
Change Six-months Ended Change
2022 2021 Dollars Percentage June 30, 2023 June 30, 2022 Dollars Percentage
Real Estate $ 1,924,916 $ 8,478,673 $ (6,553,757 ) -77 % $ 19,515,728 $ 1,924,916 $ 17,590,812 914 %
Biohealth 749,693 3,671,673 (2,921,980 ) -80 % 12,786 749,693 (736,907 ) -98 %
Digital Transformation Technology 7,701 - 7,701 100 % 28,074 7,701 20,373 265 %
Other 196,267 - 196,267 100 % 524,196 196,267 327,929 167 %
Total revenue $ 2,878,577 $ 12,150,346 $ (9,271,769 ) -76 %
Total Revenue $ 20,080,784 $ 2,878,577 $ 17,202,207 598 %

Revenue was ~~$926,340~~$19,153,848 and ~~$6,543,543~~$926,340 for the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. Revenue was ~~$2,878,577~~$20,080,784 and ~~$12,150,346~~$2,878,577 for the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. The ~~decrease~~increase in property sales from the ~~Ballenger~~Black Oak Project in the second quarter of 2023 contributed to higher revenue in this period.
In late 2022 and ~~direct~~early 2023, the Company entered into three contracts with builders to sell multiple lots from its Black Oak project. The sales contemplated by these contracts are contingent on certain conditions which the parties to such contracts will need to meet and are expected to generate approximately $22 million of funds from ~~our indirect subsidiary HWH World~~operations, not including certain expenses that the Company will be required to pay. The sale of 335 lots closed in the first six months of ~~2022 contributed~~2023 generating approximately $18.1 million revenue.
The Company plans to ~~lower~~continue its near-term focus on lot sales to regional and national builders. Funds from such lot sales will substantially improve the Company’s liquidity, strengthen its financial position and meet is working capital requirements.
In May 2023, the Company entered into lease agreement for its model house located in Montgomery County, Texas (AHR Black Oak Lease Agreement”). The revenue from the lease was $4,200 in ~~those periods. In~~ the ~~first~~three and six months ofending June 30, 2023.
In 2022 the last three homes in the Ballenger Project were sold. In this project, builders ~~are~~were required to purchase a minimum number of lots based on their applicable sale agreements. We ~~collect~~collected revenue only from the sale of lots to builders. We are not involved in the construction of homes at the present time.

Income from the sale of Front Foot Benefits (“FFBs”), assessed on Ballenger Run project lots, decreased from ~~$141,575 in the three months ended June 30, 2021 to~~ $37,725 in the three months ended June 30, ~~2022.~~2022 to $0 in the three months ended June 30, 2023. Income from the sale of FFBs decreased from ~~$248,646 in the six months ended June 30, 2021 to~~ $116,088 in the six months ended June 30, ~~2022.~~2022 to $0 in the six months ended June 30, 2023. The decrease is a result of the decreased sale of properties to homebuyers in ~~2022.~~2023.

~~In the second quarter of 2021, the Company started renting homes to tenants.~~ Revenue from ~~this~~ rental business was ~~$403,900~~$690,967 and ~~$21,947~~$403,900 in the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. Revenue from rental business was ~~$636,482~~$1,324,778 and ~~$21,947~~$636,482 in the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. The Company expects that the revenue from this business will continue to increase as we acquire more rental houses and successfully rent them.

78

In recent years, the Company expanded its biohealth segment to the South Korean market through one of the subsidiaries of ~~Health Wealth Happiness Pte. Ltd.~~HWH International Inc., HWH World Inc (“HWH World”). HWH World operates based on a direct sale model of health supplements. HWH World recognized ~~$132,222~~$0 and ~~$1,958,890~~$132,222 in revenue in the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. HWH World recognized ~~$749,693~~$12,587 and ~~$3,671,673~~$749,693 in revenue in the six months ended June 30, 2023 and 2022, ~~and 2021,~~ respectively. ~~The decrease in revenue from HWH World is caused mainly by decreased sales of annual memberships, as management is in the process of reorganizing its business model in South Korea.~~
In June 2022 the Company’s subsidiary GigWorld Inc., operating under our Digital Transformation Technology segment, started providing services to its customer in Hong Kong generating revenue of $7,701 as of June 30, 2022.

The category described as “Other” includes corporate and financial services, food and beverage business and new venture businesses. “Other” includes certain costs that are not allocated to the reportable segments, primarily consisting of unallocated corporate overhead costs, including administrative functions not allocated to the reportable segments from global functional expenses.

The financial services, food and beverage businesses and new venture businesses are small and diversified, and accordingly they are not separately addressed as one independent category. In the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, the revenue from other businesses was ~~$143,308~~$258,096 and ~~$0, respectively, generated by a Singaporean café shop operated by a subsidiary of the Company.~~$135,607, respectively. In the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, the revenue from other businesses was ~~$203,968~~$524,395 and ~~$0,~~$196,267, respectively, generated by ~~this~~Korean and Singaporean café ~~shop.~~shops and restaurants.

Cost of Revenues and Operating Expenses

The following tables sets forth period-over-period changes in cost of revenues for each of our reporting segments:

Three Months Ended
June 30,
Change Three-months Ended Change
2022 2021 Dollars Percentage June 30, 2023 June 30, 2022 Dollars Percentage
Real Estate $ 532,233 $ 2,510,369 $ (1,978,136 ) -79 % $ 11,566,130 $ 532,233 $ 11,033,897 2,073 %
Biohealth 53 97,581 (97,528 ) -100 % 95,290 (53 ) 95,343 -179,892 %
Digital Transformation Technology 2,792 - 2,792 100 % 4,571 2,792 1,779 64 %
Other 15,705 - 15,705 100 % 72,502 15,705 56,797 362 %
Total Cost of Revenues $ 550,677 $ 2,607,950 $ (2,057,273 ) -77 % $ 11,738,493 $ 550,677 $ 11,187,816 2,032 %

Six Months Ended
June 30,
Change Six-months Ended Change
2022 2021 Dollars Percentage June 30, 2023 June 30, 2022 Dollars Percentage
Real Estate $ 1,625,942 $ 6,125,201 $ (4,499,259 ) -73 % $ 12,168,470 $ 1,625,942 $ 10,542,528 648 %
Biohealth 11,985 180,603 (168,618 ) -93 % 109,657 11,985 97,672 815 %
Digital Transformation Technology 2,792 - 2,792 100 % 9,139 2,792 6,347 227 %
Other 24,508 - 24,508 100 % 140,508 24,508 116,000 473 %
Total Cost of Revenues $ 1,665,227 $ 6,305,804 $ (4,640,577 ) -74 % $ 12,427,774 $ 1,665,227 $ 10,762,547 646 %

Cost of revenues ~~decreased~~increased from ~~$2,607,950 in the three months ended June 30, 2021 to~~ $550,677 in the three months ended June 30, ~~2022. Cost of revenues decreased from 6,305,804~~2022 to $11,738,493 in the ~~six~~three months ended June 30, ~~2021 to~~2023. Cost of revenues increased from $1,665,227 in the six months ended June 30, ~~2022.~~2022 to $12,427,774 in the three months ended June 30, 2023. The ~~decrease~~increase is a result of the ~~decrease~~increase in sales in the ~~Ballenger Run project and HWH World sales.~~Black Oak Project. Capitalized construction expenses, finance costs and land costs are allocated to sales. We anticipate the total cost of revenues to increase as revenue increases.

The gross margin ~~decreased~~increased from ~~$3,935,482~~$375,663 to ~~$375,663~~$7,415,355 in the three months ended June 30, ~~2021~~2022 and ~~2022,~~2023, respectively. The gross margin ~~decreased~~increased from ~~$5,844,542~~$1,213,350 to ~~$1,213,350~~$7,653,010 in the six months ended June 30, ~~2021~~2022 and ~~2022,~~2023, respectively. The ~~decrease~~increase of gross margin was caused by the ~~decrease~~increase in sales in the ~~Ballenger Run project and HWH World sales.~~Black Oak Project.

89

The following tables sets forth period-over-period changes in operating expenses for each of our reporting segments.

Three Months Ended
June 30,
Change Three-months Ended Change
2022 2021 Dollars Percentage June 30, 2023 June 30, 2022 Dollars Percentage
Real Estate $ 784,192 $ 266,066 $ 518,126 195 % $ 552,184 $ 784,192 $ (232,008 ) -30 %
Biohealth 289,904 1,064,102 (774,198 ) -73 % 336,627 289,904 46,723 16 %
Digital transformation technology 45,713 39,247 6,466 16 %
Digital Transformation Technology 62,527 45,713 16,814 37 %
Other 910,116 7,242,097 (6,331,981 ) -87 % 1,354,521 910,116 444,405 49 %
Total operating expenses $ 2,029,925 $ 8,611,512 $ (6,581,587 ) -76 %
Total Operating Expenses $ 2,305,859 $ 2,029,925 $ 275,934 14 %

Six Months Ended
June 30,
Change Six-months Ended Change
2022 2021 Dollars Percentage June 30, 2023 June 30, 2022 Dollars Percentage
Real Estate $ 1,320,957 $ 625,555 $ 695,402 111 % $ 992,201 $ 1,320,957 $ (328,756 ) -25 %
Biohealth 910,246 1,910,582 (1,000,336 ) -52 % 477,917 910,246 (432,329 ) -47 %
Digital transformation technology 159,976 69,375 90,601 131 %
Digital Transformation Technology 202,430 159,976 42,454 27 %
Other 2,129,974 8,321,318 (6,191,344 ) -74 % 2,960,696 2,129,974 830,722 39 %
Total operating expenses $ 4,521,153 $ 10,926,830 $ (6,405,677 ) -59 %
Total Operating Expenses $ 4,633,244 $ 4,521,153 $ 112,091 2 %

The ~~increase~~decrease of operating expenses of real estate in ~~2022~~the first three and six months of 2023 compared ~~with 2021~~to the same period of 2022 was mostly caused by the ~~increase in sales and~~decrease rental related expenses. ~~Decrease~~Increase in expenses in our ~~biohealth business~~other businesses is mainly caused by the ~~decreased commission payments to our distributors, which is connected to decreased sales.~~increase in professional and consulting fees.

Other Income (Expense)

In the three months ended June 30, ~~2022,~~2023, the Company had other expense of ~~$8,328,599~~$10,922,902 compared to other expenses of ~~$70,212,030~~$8,328,599 in the three months ended June 30, ~~2021.~~2022. In the six months ended June 30, ~~2022,~~2023, the Company had other expense of ~~$14,383,397~~$13,156,354 compared to other expenses of ~~$79,161,996~~$14,383,397 in the six months ended June 30, ~~2021.~~2022. The change in realized and unrealized ~~loss~~gain (loss) on securities investments and ~~finance costs~~loss on consolidation of Alset Capital Acquisition Corp. are the primary reasons for the volatility in these two periods. Unrealized ~~loss~~gain on securities investment was ~~$6,867,375~~$18,840,726 in the three months ended June 30, ~~2022,~~2023, compared to ~~$21,168,905~~$6,867,375 loss in the three months ended June 30, ~~2021.~~2022. Unrealized ~~loss~~gain on securities investment was ~~$10,766,390~~$17,652,880 in the six months ended June 30, ~~2022,~~2023, compared to ~~$30,703,914~~$10,766,390 loss in the six months ended June 30, ~~2021.~~2022. Realized loss on security investment was ~~$2,918,668~~$10,557,229 the three months ended June 30, ~~2022,~~2023, compared to a ~~gain~~loss of ~~$555,206~~$2,918,668 in the three months ended June 30, ~~2021.~~2022. Realized loss on security investment was ~~$6,355,451~~$10,688,542 the six months ended June 30, ~~2022,~~2023, compared to a ~~gain~~loss of ~~$296,961~~$6,355,451 in the six months ended June 30, ~~2021. Finance costs were $2,879 the three months ended June 30, 2022, compared to costs of $50,261,203~~2022. Loss on consolidation was $21,657,036 in the three ~~months ended June 30, 2021. Finance costs were $450,887 the~~and six months ended June 30, ~~2022,~~2023, compared to ~~costs~~loss on consolidation of ~~$50,844,071~~$0 in the three and six months ended June 30, ~~2021.~~
2022.

Net Loss

In the three months ended June 30, ~~2022~~2023 the Company had net loss of ~~$9,982,861~~$5,813,406 compared to net loss of ~~$74,889,324~~$9,982,861 in the three months ended June 30, ~~2021.~~2022. In the six months ended June 30, ~~2022~~2023 the Company had net loss of ~~$17,913,314~~$10,136,588 compared to net loss of ~~$84,696,885~~$17,913,314 in the six months ended June 30, ~~2021.~~
2022.

Liquidity and Capital Resources

Our real estate assets have ~~increased~~decreased to ~~$43,140,539~~$39,445,204 as of June 30, ~~2022~~2023 from ~~$40,515,380~~$54,618,729 as of December 31, ~~2021.~~2022. This ~~increase~~decrease primarily reflects the ~~additional rental~~sale of properties ~~we purchased in first half of 2022. In the six months ended June 30, 2022, we purchased three homes, which will be used~~ in the ~~Company’s rental business.~~ Black Oak project.
Our ~~rental properties assets were $25,831,478~~cash has increased from $17,827,383 as of December 31, 2022 to $28,827,961 as of June 30, ~~2022. In~~2023. Our liabilities increased from $4,827,221 at December 31, 2022 to $8,152,468 at June 30, 2023. Our total assets have increased to $168,441,811 as of June 30, 2023 from $153,490,336 as of December 31, 2022 mainly due to increase in cash held in Trust Account after the ~~first six months~~consolidation of ~~2022, one of the Company’s subsidiaries sold two plots of land it owns in Australia (which had been planned to be part of the SeD Perth project).~~Alset Capital Acquisition Corp.

910

Our cash has decreased from $56,061,309 as of December 31, 2021 to $41,326,946 as of June 30, 2022. Our liabilities decreased from $13,920,357 at December 31, 2021 to $3,906,248 at June 30, 2022. Our total assets have decreased to $176,071,320 as of June 30, 2022 from $184,210,143 as of December 31, 2021 mainly due to decrease in cash.
The management believes that the available cash in bank accounts and favorable cash revenue from real estate projects are sufficient to fund our operations for at least the next 12 months.

Summary of Cash Flows for the ~~Six~~Three Months Ended June 30, ~~2022~~2023 and ~~2021~~2022

Six-months Ended
2023 2022
Net cash provided by (used in) operating activities $ 7,409,770 $ (16,125,804 )
Net cash used in investing activities $ (606,983 ) $ (8,308,426 )
Net cash provided by financing activities $ 3,416,971 $ 6,041,139
Six Months Ended June 30,
2022 2021
Net cash used in operating activities $ (16,125,804 ) $ (10,649,851 )
Net cash (used in) provided by investing activities $ (8,308,426 ) $ 2,234,619
Net cash provided by financing activities $ 6,041,139 $ 43,898,095
Cash Flows from Operating Activities

Net cash ~~used in~~provided by operating activities was ~~$16,125,804~~$7,409,770 in the first six months of ~~2022,~~2023, as compared to net cash used in operating activities of ~~$10,649,851~~$16,125,804 in the same period of ~~2021. The payment of accrued bonus due to director of $3,614,749 contributed to~~2022. Property sales from the ~~decrease of~~Black Oak project in 2023 were the main reason for the cash inprovided by operating activities in ~~the first six months of 2022.~~
2023.

Cash Flows from Investing Activities

Net cash used in investing activities was ~~$8,308,426~~$606,983 in the first six months of ~~2022,~~2023, as compared to net cash ~~provided by~~used in investing activities of ~~$2,234,619~~$8,308,426 in the same period of ~~2021.~~2022. In the six months ended June 30, 2023 we invested $907,212 in marketable securities, issued $1,628,010 in loans to related parties and received $2,674,653 from repayment of related party notes receivable. In the six months ended June 30, 2022 we invested $6,662,017 in marketable securities, invested $722,817 to purchase real estate properties and $602,161 in real estate ~~property~~ improvements. ~~In the six months ended June 30, 2021 we invested $758,208 in marketable securities and we received approximately $2.5 million from the sale of Vivacitas Oncology to a related party.~~

Cash Flows from Financing Activities

Net cash provided by financing activities was $3,416,971 in the six months ended June 30, 2023, compared to net cash provided of $6,041,139 in the six months ended June 30, ~~2022, compared to net cash provided of $43,898,095 the six months ended June 30, 2021.~~2022. The ~~increase in~~ cash provided by financing activities in the first six months of ~~2022~~2023 is ~~primarily~~ caused by the proceeds from stock issuance of ~~$6,213,000. Additionally, the Company repaid $171,861 to loan payable.~~$3,433,921. During the six months ended June 30, ~~2021,~~2022, we received ~~cash proceeds~~$6,213,000 from conversion of ~~$39,268,580 from stock issuance, $2,753,203 from exercise of subsidiary warrants, $280,000 from the sale of our GigWorld shares to individual investors and $5,545,495 from a~~ related party ~~loan. The Company also distributed $1,151,500~~note payable to ~~one minority interest investor~~common stock and we repaid ~~$2,102,400~~$171,861 of ~~promissory note held by related parties.~~
~~Off-Balance Sheet Arrangements~~
We do not have any off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, results of operations, liquidity or capital expenditures.debt.

Impact of Inflation

We believe that inflation has not had a material impact on our results of operations for the ~~six~~three months ended June 30, ~~2022~~2023 or the year ended December 31, 2021. Our current and anticipated costs in our real estate and other business lines have increased due to recent inflation, including projected costs of materials and salaries, and such increases may be significant as we engage in additional operations.2022. We cannot assure you that future inflation will not have an adverse impact on our operating results and financial condition.
10

Impact of Foreign Exchange Rates

The effect of foreign exchange rate changes on the intercompany loans (under ASC 830), which mostly consist of loans from Singapore to the United States and which were approximately ~~$43~~$37 million and ~~$43~~$51 million on June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively, are the reason for the significant fluctuation of foreign currency transaction Gain or Loss on the Condensed Consolidated Statements of Operations and Other Comprehensive Loss. Because the intercompany loan balances between Singapore and United States will remain at approximately ~~$43~~$37 million over the next year, we expect this fluctuation of foreign exchange rates to still significantly impact the results of operations in ~~2022,~~2023, especially given that the foreign exchange rate may and is expected to be volatile. If the amount of intercompany loan is lowered in the future, the effect will also be reduced. However, at this moment, we do not expect to repay the intercompany loans in the short term.

Emerging Growth Company Status

We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies.” Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of these exemptions until we are no longer an emerging growth company or until we affirmatively and irrevocably opt out of this exemption.

11
Seasonality

The real estate business is subject to seasonal shifts in costs as certain work is more likely to be performed at certain times of the year. This may impact the expenses of our subsidiary Alset EHome Inc. from time to time. In addition, should we commence building homes, we are likely to experience periodic spikes in sales as we commence the sales process at a particular location.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

As a “smaller reporting company” as defined by Item 10(f)(1) of Regulation S-K, the Company is not required to provide the information required by this Item.

Item 4. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, an evaluation was performed under the supervision and with the participation of our management, including our Chief Executive Officers and Chief Financial Officers, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on that evaluation, our management, including our Chief Executive Officers and Chief Financial Officers, concluded that our disclosure controls and procedures are not effective as of June 30, ~~2022~~2023 to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officers and Chief Financial Officers, as appropriate to allow timely decisions regarding required disclosure.

(b) Changes in the Company’s Internal Controls Over Financial Reporting

There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15(d)-15(f) under the Exchange Act) that occurred during the quarterly period ended June 30, ~~2022~~2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

11
Part II. Other Information

Item 1. Legal Proceeding

On September 27, 2019, iGalen International Inc., which was at that time one of our majority-owned subsidiaries, and iGalen Inc., its wholly-owned subsidiary, filed a complaint in the Superior Court of the State of California, County of San Diego, Central Division, against Gara Group, Inc., a Delaware corporation, and certain affiliated or related entities, including the Chief Executive Officer of the Gara Group (collectively these entities are referred to herein as the “Gara Group”). The complaint, as amended on October 24, 2019, enumerated causes of action for breach of contract, breach of covenant of good faith and fair dealing and intentional interference with economic relations.
On October 10, 2019, Gara Group filed a complaint in the Superior Court of the State of California, County of San Diego, Central Division against iGalen International Inc., iGalen Inc., Alset International Limited, Chan Heng Fai, Dr. Rajen Manicka and David Price, an executive of iGalen Inc. Gara Group filed an amended complaint filed on March 13, 2020.
~~iGalen International Inc. was sold by one of the Company’s subsidiaries on December 30, 2020.~~
~~On April 13, 2022, the parties to these lawsuits entered into a settlement agreement, resolving these matters.~~Not applicable.

Item 1A. Risk Factors

Not applicable to smaller reporting companies.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On January 17, 2022 the Company entered into a securities purchase agreement with Chan Heng Fai, the Company’s Chairman, Chief Executive Officer and largest stockholder, pursuant to which the Company agreed to purchase from Chan Heng Fai 293,428,200 ordinary shares of Alset International for a purchase price of 29,468,977 newly issued shares of the Company’s common stock. On February 28, 2022, the Company and Chan Heng Fai entered into an amendment to this securities purchase agreement pursuant to which the Company agreed to purchase these 293,428,200 ordinary shares of Alset International for a purchase price of 35,319,290 newly issued shares of the Company’s common stock. The closing of this transaction was subject to the approval of the Nasdaq and the Company’s stockholders. These 293,428,200 ordinary shares of Alset International represent approximately 8.4% of the total issued and outstanding shares of Alset International.
On June 6, 2022, the Company held a Special Meeting of Stockholders (the “Special Meeting”). At the Special Meeting, the stockholders approved the issuance of 35,319,290 newly issued shares of the Company’s common stock in connection with the purchase of 293,428,200 ordinary shares of Alset International Limited in accordance with NASDAQ Listing Rule 5635(a). The transaction was completed on July 18, 2022. In connection with the issuance of these securities, the Company relied upon the exemption from registration provided by Section 4(a)(2) under the Securities Act of 1933, as amended, for transactions not involving a public offering.Not applicable.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not Applicable.

12
Item 5. Other Information

~~None.~~Not applicable.

12
Item 6. Exhibits

The following documents are filed as a part of this report:

Exhibit Number

Description
10.1*1.1 ~~Consulting~~Underwriting Agreement ~~dated June 23, 2022, by and between SeD Development Management LLC and MacKenzie Equity Partners, LLC.~~
~~10.2~~ ~~Amendment No. 1 to Assignment and Assumption Agreement, dated July 12, 2022,~~ by and between Alset ~~International Limited~~Inc. and ~~DSS, Inc.~~Aegis Capital Corp., ~~incorporated~~dated February 6, 2023 (incorporated by reference to Exhibit ~~10.3~~1.1 to Current Report on Form 8-K filed with the SEC on ~~July 14, 2022.~~February 8, 2023)
10.1(1)(2) Purchase and Sale Agreement, dated March 16, 2023, between 150 CCM Black Oak, Ltd. and Rausch Coleman Homes Houston, LLC (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the SEC on March 28, 2023.
10.2(1)(2) Contract of Sale, dated March 17, 2023, between 150 CCM Black Oak, Ltd. and Davidson Homes, LLC (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed with the SEC on March 28, 2023.
31.1a* Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.1b* Certification of Co-Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2a* Certification of Co-Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2b* Certification of Co-Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1** Certifications of the Chief Executive Officer and Chief Financial Officers pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS Inline XBRL Instance Document
101.SCH Inline XBRL Taxonomy Extension Schema Document
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Filed herewith.
** Furnished herewith.

(1) Certain of the exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Registrant agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon its request.
(2) Portions of this exhibit (indicated by asterisks) have been omitted under rules of the SEC permitting the confidential treatment of select information. The Registrant agrees to furnish a copy of all omitted information to the SEC upon its request.
13
SIGNATURES

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

ALSET ~~EHOME INTERNATIONAL~~ INC.

August ~~15, 2022~~14, 2023 By: /s/ Chan Heng Fai

Chan Heng Fai
Chairman of the Board and
Chief Executive Officer
(Principal Executive Officer)

August ~~15, 2022~~14, 2023 By: /s/ Chan Tung Moe
Chan Tung Moe
Co-Chief Executive Officer
(Principal Executive Officer)

August ~~15, 2022~~14, 2023 By: /s/ Rongguo Wei

Rongguo Wei
Co-Chief Financial Officer
(Principal Financial and Accounting Officer)

August ~~15, 2022~~14, 2023 By: /s/ Lui Wai Leung Alan

Lui Wai Leung Alan
Co-Chief Financial Officer
(Principal Financial and Accounting Officer)
14

	2022			2021			2022			2021
	Three Months Ended on June 30,						Six Months Ended on June 30,
	2022			2021			2022			2021

Revenue
Rental	$	403,900		$	21,947		$	636,482		$	21,947
Property		246,910			4,562,595			1,288,434			8,456,726
Biohealth		132,222			1,958,890			749,693			3,671,673
Digital Transformation Technology – related party		7,701			-			7,701			-
Other		135,607			-			196,267			-
Total Revenue		926,340			6,543,432			2,878,577			12,150,346
Operating Expenses
Cost of Sales		550,677			2,607,950			1,665,227			6,305,804
General and Administrative		2,029,925			8,611,512			4,521,153			10,926,830
Total Operating Expenses		2,580,602			11,219,462			6,186,380			17,232,634

Operating Losses from Operations		(1,654,262	)		(4,676,030	)		(3,307,803	)		(5,082,288	)

Other Income (Expense)
Interest Income		196,639			25,656			369,039			56,288
Interest Expense		-			(262,703	)		-			(316,285	)
Foreign Exchange Transaction Gain		2,077,709			958,334			2,485,804			2,421,031
Unrealized Loss on Securities Investment		(6,867,375	)		(21,168,905	)		(10,766,390	)		(30,703,914	)
Realized Loss (Gain) on Securities Investment		(2,918,668	)		555,206			(6,355,451	)		296,961
Loss on Investment on Security by Equity Method		(79,670	)		(77,459	)		(216,050	)		(102,306	)
Finance Costs		(2,879	)		(50,261,203	)		(450,887	)		(50,844,071	)
Other (Expense) Income		(734,355	)		19,044			550,538			30,300
Total Other Expense, Net		(8,328,599	)		(70,212,030	)		(14,383,397	)		(79,161,996	)

Net Loss Income Before Income Taxes		(9,982,861	)		(74,888,060	)		(17,691,200	)		(84,244,284	)

Income Tax Expense		-			(1,264	)		(222,114	)		(452,601	)

Net Loss		(9,982,861	)		(74,889,324	)		(17,913,314	)		(84,696,885	)

Net Loss Attributable to Non-Controlling Interest		(995,502	)		(8,238,460	)		(2,458,669	)		(11,807,572	)

Net Loss Attributable to Common Stockholders	$	(8,987,359	)	$	(66,650,864	)	$	(15,454,645	)	$	(72,889,313	)

Other Comprehensive Loss, Net
Unrealized Loss on Securities Investment		(591	)		(35,922	)		(9,714	)		(37,909	)
Foreign Currency Translation Adjustment		(3,514,595	)		(1,070,191	)		(4,163,735	)		(2,839,631	)
Comprehensive Loss		(13,498,047	)		(75,995,437	)		(22,086,763	)		(87,574,425	)

Comprehensive Loss Attributable to Non-controlling Interests		(2,286,174	)		(8,584,838	)		(3,371,569	)		(12,913,762	)

Comprehensive Loss Attributable to Common Stockholders	$	(11,211,873	)	$	(67,410,599	)	$	(18,715,194	)	$	(74,660,663	)

Net Loss Per Share - Basic and Diluted	$	(0.07	)	$	(6.03	)	$	(0.14	)	$	(7.42	)

Weighted Average Common Shares Outstanding - Basic and Diluted		122,891,000			11,056,534			111,728,663			9,824,059


	Series A Preferred Stock				Series B Preferred Stock				Common Stock
	Shares		Par Value $0.001		Shares		Par Value $0.001		Shares		Par Value $0.001		Additional Paid in Capital			Accumulated Other Comprehensive Income			Accumulated Deficit			Total Alset EHome International Stockholders’ Equity			Non-Controlling Interests			Total Stockholders’ Equity
Balance at January 1, 2022		-	$	-		-	$	-		87,368,446	$	87,368	$	296,181,977		$	341,646		$	(148,233,473	)	$	148,377,518		$	21,912,268		$	170,289,786

Issuance of Stock by Exercising Warrants		-		-		-		-		15,819,452		15,820		(11,925	)		-			-			3,895			-			3,895

Convert Related Party Note to Common Stock		-		-		-		-		10,000,000		10,000		6,203,000			-			-			6,213,000			-			6,213,000

Deconsolidate Alset Capital Acquisition		-		-		-		-		-		-		17,160,800			-			-			17,160,800			2,227,744			19,388,544

Gain from Purchase of DSS Stock		-		-		-		-		-		-		737,572			-			-			737,572			-			737,572

Beneficial Conversion Feature Intrinsic Value, Net		-		-		-		-		-		-		450,000			-			-			450,000			-			450,000

Change in Non-Controlling Interests		-		-		-		-		-		-		(316,459	)		459,069			-			142,610			(142,610	)		-

Change in Unrealized Loss on Investment		-		-		-		-		-		-		-			(7,027	)		-			(7,027	)		(2,096	)		(9,123	)

Foreign Currency Translations		-		-		-		-		-		-		-			(499,967	)		-			(499,967	)		(149,173	)		(649,140	)

Net Loss		-		-		-		-		-		-		-			-			(6,467,286	)		(6,467,286	)		(1,463,167	)		(7,930,453	)

Balance at March 31, 2022		-	$	-		-	$	-		113,187,898	$	113,188	$	320,404,965		$	293,721		$	(154,700,759	)	$	166,111,115		$	22,382,966		$	188,494,081

Issuance of Common Stock										35,319,290	$	35,319	$	(35,319	)		-			-			-			-			-

Change in Valuation on Investment		-		-		-		-		-		-		(2,624,585	)		-			-			(2,624,585	)		(206,377	)		(2,830,962	)

Change in Non-Controlling Interests		-		-		-		-		-		-		4,557,454			3,266,996			-			7,824,450			(7,824,450	)		-

Change in Unrealized Loss on Investment		-		-		-		-		-		-		-			(505	)		-			(505	)		(86	)		(591	)

Foreign Currency Translations		-		-		-		-		-		-		-			(3,002,167	)		-			(3,002,167	)		(512,428	)		(3,514,595	)

Net Loss		-		-		-		-		-		-		-			-			(8,987,359	)		(8,987,359	)		(995,502	)		(9,982,861	)

Balance at June 30, 2022		-	$	-		-	$	-		148,507,188	$	148,507	$	322,302,515		$	558,045		$	(163,688,118	)	$	159,320,949		$	12,844,123		$	172,165,072


	June 30, 2022		December 31, 2021
PPP Loan		-		68,502
Australia Loan		-		162,696
Hire Purchase		77,308		86,473
Total notes payable	$	77,308	$	317,671

	Shares		Par value		Amount received
Offering		4,700,637	$	4,701	$	29,145,056
Exercise of Pre-Funded Units		1,611,000	$	1,611	$	16,110
Exercise of Underwriter’s Series A Warrants		808,363	$	808	$	3,755,774
Exercise of Series A and Series B Warrants		1,367,324	$	1,367	$	6,937,347
Offering Expenses		-	$	-	$	(88,848	)
Total		8,487,324	$	8,487	$	39,765,439


	Shares		Par value		Amount received
Offering		18,923,334	$	18,923	$	27,263,673
Exercise of Pre-Funded Units		15,223,333	$	15,223	$	8,823
Exercise of Underwriter’s Over-Allotment Option		7,500,000	$	7,500	$	4,115,000
Offering Expenses		-	$	-	$	(40,621	)
Total		41,646,667	$	41,647	$	31,346,875


2022	$	871,824
2023		531,550
2024		7,450
Total Future Receipts	$	1,410,824

		Share price				Market Value
		12/31/2021		Shares		12/31/2021		Valuation

DSS (Related Party)		$	0.672		19,888,262	$	13,364,912	Investment in Securities at Fair Value

AMBS (Related Party)		$	0.016		20,000,000	$	328,000	Investment in Securities at Fair Value

Holista (Related Party)		$	0.034		43,626,621	$	1,489,179	Investment in Securities at Fair Value

American Premium Mining (Related Party)		$	0.002		354,039,000	$	778,886	Investment in Securities at Fair Value

True Partner		$	0.119		62,122,908	$	7,409,717	Investment in Securities at Fair Value

Value Exchange		$	0.300		6,500,000	$	1,950,000	Investment in Securities at Fair Value

Trading Stocks						$	9,908,077	Investment in Securities at Fair Value

	Total Level 1 Equity Securities					$	35,228,771

Nervotech			N/A		1,666	$	37,045	Investment in Securities at Cost
Hyten Global			N/A		3,800	$	42,562	Investment in Securities at Cost
Ubeauty			N/A		3,600	$	19,609	Investment in Securities at Cost
			Total Equity Securities			$	35,327,987

	Total
Balance at January 1, 2021	$	66,978
Total losses		(1,987	)
Balance at March 31, 2021	$	64,991
Total losses		(35,922	)
Balance at June 30, 2021	$	29,069

	Three- Months Ended				Six-months Ended
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Revenue	$	19,153,848	$	926,340	$	20,080,784	$	2,878,577
Operating Expenses	$	14,044,352	$	2,580,602	$	17,061,018	$	6,186,380
Other Expenses	$	10,922,902	$	8,328,599	$	13,156,354	$	14,383,397
Net Loss	$	5,813,406	$	9,982,861	$	10,136,588	$	17,913,314

	Three- Months Ended				Six-months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
Revenue	$	926,340	$	6,543,432	$	2,878,577	$	12,150,346
Operating Expenses	$	2,580,602	$	11,219,462	$	6,186,380	$	17,232,634
Other Expenses	$	8,328,599	$	70,212,030	$	14,383,397	$	79,161,996
Net Loss	$	9,982,861	$	74,889,324	$	17,913,314	$	84,696,885

	Three Months Ended June 30,				Change						Three-months Ended				Change
	2022		2021		Dollars			Percentage			June 30, 2023		June 30, 2022		Dollars			Percentage
Real Estate	$	650,810	$	4,584,542	$	(3,933,732	)		-86	%	$	18,881,917	$	650,810	$	18,231,107			2,801	%
Biohealth		132,222		1,958,890		(1,826,668	)		-93	%		-		132,222		(132,222	)		-100	%
Digital Transformation Technology		7,701		-		7,701			100	%		14,034		7,701		6,333			82	%
Other		135,607		-		135,607			100	%		257,897		135,607		122,290			90	%
Total revenue	$	926,340	$	6,543,432	$	(5,617,092	)		-86	%
Total Revenue											$	19,153,848	$	926,340	$	18,227,508			1,968	%

	Six Months Ended June 30,				Change						Six-months Ended				Change
	2022		2021		Dollars			Percentage			June 30, 2023		June 30, 2022		Dollars			Percentage
Real Estate	$	1,924,916	$	8,478,673	$	(6,553,757	)		-77	%	$	19,515,728	$	1,924,916	$	17,590,812			914	%
Biohealth		749,693		3,671,673		(2,921,980	)		-80	%		12,786		749,693		(736,907	)		-98	%
Digital Transformation Technology		7,701		-		7,701			100	%		28,074		7,701		20,373			265	%
Other		196,267		-		196,267			100	%		524,196		196,267		327,929			167	%
Total revenue	$	2,878,577	$	12,150,346	$	(9,271,769	)		-76	%
Total Revenue											$	20,080,784	$	2,878,577	$	17,202,207			598	%

	Six Months Ended June 30,
	2022			2021
Net cash used in operating activities	$	(16,125,804	)	$	(10,649,851	)
Net cash (used in) provided by investing activities	$	(8,308,426	)	$	2,234,619
Net cash provided by financing activities	$	6,041,139		$	43,898,095

Exhibit Number		Description
10.1*1.1		~~Consulting~~Underwriting Agreement ~~dated June 23, 2022, by and between SeD Development Management LLC and MacKenzie Equity Partners, LLC.~~
~~10.2~~		~~Amendment No. 1 to Assignment and Assumption Agreement, dated July 12, 2022,~~ by and between Alset ~~International Limited~~Inc. and ~~DSS, Inc.~~Aegis Capital Corp., ~~incorporated~~dated February 6, 2023 (incorporated by reference to Exhibit ~~10.3~~1.1 to Current Report on Form 8-K filed with the SEC on ~~July 14, 2022.~~February 8, 2023)
10.1(1)(2)		Purchase and Sale Agreement, dated March 16, 2023, between 150 CCM Black Oak, Ltd. and Rausch Coleman Homes Houston, LLC (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the SEC on March 28, 2023.
10.2(1)(2)		Contract of Sale, dated March 17, 2023, between 150 CCM Black Oak, Ltd. and Davidson Homes, LLC (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed with the SEC on March 28, 2023.
31.1a*		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.1b*		Certification of Co-Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2a*		Certification of Co-Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2b*		Certification of Co-Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**		Certifications of the Chief Executive Officer and Chief Financial Officers pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

	ALSET ~~EHOME INTERNATIONAL~~ INC.

August ~~15, 2022~~14, 2023	By:	/s/ Chan Heng Fai
		Chan Heng Fai Chairman of the Board and Chief Executive Officer
		(Principal Executive Officer)

August ~~15, 2022~~14, 2023	By:	/s/ Chan Tung Moe
		Chan Tung Moe
		Co-Chief Executive Officer
		(Principal Executive Officer)

August ~~15, 2022~~14, 2023	By:	/s/ Rongguo Wei
		Rongguo Wei Co-Chief Financial Officer
		(Principal Financial and Accounting Officer)

August ~~15, 2022~~14, 2023	By:	/s/ Lui Wai Leung Alan
		Lui Wai Leung Alan Co-Chief Financial Officer
		(Principal Financial and Accounting Officer)