Form 4: Executive Chairman and Related Entities Report Beneficial Ownership Changes in Sharing Services Global Corp

Executive Chairman Chan Heng Fai Ambrose and related entities Alset Inc. and HWH International Inc. report changes in beneficial ownership of Sharing Services Global Corp through convertible promissory notes and warrants.

Summary

• This document is a SEC Form 4 filing detailing changes in beneficial ownership of Sharing Services Global Corp (SHRG) securities.
• The filing involves Executive Chairman Chan Heng Fai Ambrose, and related entities Alset Inc. and HWH International Inc.
• The changes stem from a series of convertible promissory notes issued by SHRG to HWH and Alset between March and November 2024.
• These notes, totaling $3,100,000, can be converted into SHRG common stock at varying prices, ranging from $0.10 to $2.80 per share.
• The notes also include warrants to purchase additional shares at $1.68 per share.
• The conversion period for all notes is between March 25, 2025, and the respective maturity dates of the notes.
• Chan Heng Fai Ambrose has indirect beneficial ownership and dispositive control over the securities held by Alset Inc. and HWH International Inc.

Sentiment

Score: 5

Explanation: The document is neutral in sentiment as it is a factual reporting of transactions. The potential dilution is a negative, but the capital raised is a positive.

Risks

• The potential conversion of the promissory notes could significantly dilute existing shareholders.
• The varying conversion prices could lead to different levels of dilution depending on which notes are converted.
• The large number of shares potentially issuable through the notes and warrants could put downward pressure on the stock price.

Future Outlook

The document does not contain any specific forward-looking statements, but the potential conversion of the notes will impact the company's share structure.

Management Comments

• Mr. Chan is the Chairman, Chief Executive Officer and majority stockholder of Alset Inc.
• Mr. Chan, as indirect beneficial owner, has dispositive control over the securities of the Issuer owned by Alset Inc.
• Mr. Chan is the Chairman of HWH International Inc., which is a majority-owned subsidiary of Alset Inc.
• Mr. Chan, as indirect beneficial owner, has dispositive control over the securities of the Issuer owned by HWH International Inc.

Industry Context

This type of filing is common for companies that use convertible debt to raise capital. The conversion of debt to equity is a standard practice in corporate finance.

Comparison to Industry Standards

• Convertible notes are a common financing tool, particularly for smaller companies or those in early stages of growth, similar to companies like Cassava Sciences (SAVA) which have used convertible notes to raise capital.
• The conversion prices and terms are specific to the agreement between SHRG and the note holders, and are not directly comparable to other companies without detailed analysis of their specific financing agreements.
• The level of potential dilution is a key factor to consider, and this is similar to other companies that have used convertible notes, such as those in the biotech sector.

Related Party Transactions

• The transactions involve related parties, specifically HWH International Inc. and Alset Inc., both of which are controlled by Chan Heng Fai Ambrose.

Stakeholder Impact

• Shareholders may experience dilution if the notes are converted to equity.
• The company's financial structure will be impacted by the conversion of debt to equity.
• The potential for a large number of new shares could affect the stock price.

Next Steps

• The next key event is the start of the conversion period for the notes on March 25, 2025.
• The market will be watching to see if and when the note holders choose to convert their debt into equity.

Key Dates

Keywords

beneficial ownership, convertible promissory notes, warrants, SEC Form 4, SHRG, Chan Heng Fai Ambrose, Alset Inc., HWH International Inc., equity securities, dilution