| Contracts and Commitments | NOTE 17 CONTRACTS
AND COMMITMENTS EQUITY LINE FACILITY - INVESTMENT AGREEMENT
WITH AZURE CAPITAL, INC. On March 6, 2017, PHI Group, Inc., a
Nevada corporation (the “Company”) and Azure Capital, a Massachusetts Corporation (the “Investor”) entered
into an Investment Agreement (the “Investment Agreement”) and a Registration Rights Agreement (the “Registration
Rights Agreement”), each dated March 6, 2017 between the Company and the Investor. Pursuant to the Investment Agreement,
the Investor committed to purchase, subject to certain restrictions and conditions, up to $10,000,000 worth of the Company’s
common stock, over a period of 36 months from the effectiveness of the registration statement registering the resale of shares
purchased by the Investor pursuant to the Investment Agreement. The Company agreed to initially reserve 20,000,000 shares of its
Common Stock for issuance to the Investor pursuant to the Investment Agreement. In the event the Company cannot register a sufficient
number of shares of its Common Stock for issuance pursuant to the Investment Agreement, the Company will use its best efforts to
authorize and reserve for issuance the number of shares required for the Company to perform its obligations in connection with
the Investment Agreement as soon as reasonable practical. The Company may in its discretion draw
on the facility from time to time, as and when the Company determines appropriate in accordance with the terms and conditions of
the Investment Agreement. The maximum number of shares that the Company is entitled to put to the Investor in any one draw down
notice shall not exceed shares with a purchase price of $250,000 or 200% of the average daily volume (U.S. market only) of the
Company’s Common Stock for the three (3) Trading Days prior to the applicable put notice date multiplied by the average of
the three (3) daily closing prices immediately preceding the put date, calculated in accordance with the Investment Agreement.
The Company may deliver a notice for a subsequent put from time to time, after the pricing period for the prior put has been completed. The purchase price shall be set at ninety-four
percent (94%) of the lowest daily volume weighted average price (VWAP) of the Company’s common stock during the five (5)
consecutive trading days immediately following the put notice date. On each put notice submitted to the Investor by the Company,
the Company shall specify a suspension price for that put. In the event the price of Company’s Common Stock falls below the
suspension price, the put shall be temporarily suspended. The put shall resume at such time the price of the Company’s Common
Stock is above the suspension price, provided the dates for the pricing period for that particular put are still valid. In the
event the pricing period has been complete, any shares above the suspension price due to the Investor shall be sold to the Investor
by the Company at the suspension price under the terms of the Investment Agreement. The suspension price for a put may not be changed
by the Company once submitted to the Investor. There are put restrictions applied on
days between the draw down notice date and the closing date with respect to that particular put. During such time, the Company
shall not be entitled to deliver another draw down notice. In addition, the Investor will not be obligated to purchase shares if
the Investor’s total number of shares beneficially held at that time would exceed 4.99% of the number of shares of the Company’s
common stock as determined in accordance with Rule 13d-1(j) of the Securities Exchange Act of 1934, as amended. In addition, the
Company is not permitted to draw on the facility unless there is an effective registration statement to cover the resale of the
shares. The Investment Agreement also contains
customary representations and warranties of each of the parties. The assertions embodied in those representations and warranties
were made for purposes of the Investment Agreement and are subject to qualifications and limitations agreed to by the parties in
connection with negotiating the terms of the Investment Agreement. The Investment Agreement further provides that the Company and
the Investor are each entitled to customary indemnification from the other for, among other things, any losses or liabilities they
may suffer as a result of any breach by the other party of any provisions of the Investment Agreement or Registration Rights Agreement
(as defined below). Investor should read the Investment Agreement together with the other information concerning the Company that
the Company publicly files in reports and statements with the Securities and Exchange Commission (the “SEC”). Pursuant to the terms of the Registration
Rights Agreement, the Company is obligated to file one or more registrations statements with the SEC within twenty-one (21) days
after the date of the Registration Rights Agreement to register the resale by the Investor of the shares of common stock issued
or issuable under the Investment Agreement. In addition, the Company is obligated to use all commercially reasonable efforts to
have the registration statement declared effective by the SEC within 90 days after the registration statement is filed. This Investment Agreement was amended
on August 3, 2017 to allow for the reservation of 65,445,000 shares of the Company’s Common Stock for issuance to the Investor
pursuant to the corrected Investment Agreement. The Company has filed a S-1 Registration
Statement with the Securities and Exchange Commission to include 7,936,600 shares of its Common Stock for issuance in connection
with the first tranche of the Equity Line Facility. The S-1 Registration Statement, as amended, was declared effective by the Securities
and Exchange Commission on January 11, 2018. The Company intends to access the Equity Line Facility only when the Company’s
stock prices reach levels that its management deems fairly-valued. SETTLEMENT
AGREEMENT WITH THINH HUNG INVESTMENT CO. On August 3, 2017, the Company signed
a Settlement Agreement and agreed to pay Thinh Hung Investment Co. a total amount of $381,000, which includes the outstanding balance
of $288,219 that is reclassified as Customer Advances in the Long-term Liability portion of the attached balance sheet and accrued
interest as agreed by the two parties. According to the Settlement Agreement,
the Compapny will transfer or cause to be transferred at least 480,000 shares of Common Stock of PHI Group, Inc. to an authorized
represenatative of Thinh Hung. In the event Thinh Hung is unable to realize at least $381,000 from the sale of PHI Stock, PHI Group
will either transfer additional Common Stock of PHI Group, Inc. or other marketable securities to the authorized reprenesattive
designated Thinh Hung or pay cash directly to Thinh Hung until the total amount of $381,000 is reached. PHI Group, Inc. agreed
to use its best efforst to pay off any outstanding balance by October 31, 2017. After the receipt of at least 480,000 shares of
PHI Group Stock by the authorized representative of Thinh Hung, Thinh Hung shall deliver and transfer all the Vietnam Foods Corporation
Stock to PHI Group, Inc. or its authorized representative. As of the day of this report, the Company has not been able to transfer
480,000 shares of its Common Stock to Thinh Hung’s authorized representative. BUSINESS
COOPERATION AGREEMENT WITH TNB VIETNAM JSC On August
7, 2017, the Company signed a Business Cooperation Agreement with TNB Vietnam JSC, a Vietnamese company located in the Mekong Delta
that specializes in cultivating and processing “forest” bitter melon (momordica charantia). According to the agreement,
TNB and PHI Group plan to facilitate mutual growth and expansion including but not limited to: (1) Purchase of finished forest
bitter melon products from TNB for distribution and sale in the U.S., Europe, China and other select international markets under
PHI Group’s private labels; (2) Purchase of semi-processed ingredients from TNB in order to manufacture other end products
for export markets; (3) Strategic alliance by acquisition of equity interest in TNB and/or exchange of ownership between TNB and
PHI via stock swap; and (4) Co-developing and cultivating forest bitter melon as well as manufacturing and marketing its products
in the U.S. and other international markets with potential for long-term growth. FORMATION OF
PHI EZ WATER TECH, INC. SUBSIDIARY On August 7,
2017, the Company incorporated PHI EZ Water Tech, Inc., a Wyoming corporation, as a subsidiary to manage and commercialize the
water treatment systems developed by Dr. Martin Nguyen, a Vietnamese-American scientist. These systems
are among a series of products developed by Dr. Nguyen using quantum technology in a combination of disciplines including applied
physics, applied water science, biological system engineering and agricultural economics. Incorporating complex electromagnetic
force, advanced oxidation, electrocoagulation and ultrasound, they can reduce water consumption by up to 30% and fertilizer usage
by 30%-50% while boosting crop yields by 30%-50%. The water produced from these systems is also good for human health and able
to stabilize water environments to increase yields for aquatic and wet paddy farming. ( www.phiezwater.com MEMORANDUM
OF UNDERSTANDING WITH AQUARIUS POWER, INC. On August 9,
2017, the Company signed a Memorandum of Understanding (“MOU”) with Aquarius Power, Inc. (“AQP”), a Texas
company, to provide renewable energy technology to Vietnam. PHI has also made an investment to become a strategic shareholder of
AQP. PHI and AQP
will form a joint venture company which will have the exclusive right to sublicense, sell, build, own and/or operate the AQP energy
systems in Vietnam on an exclusive basis. PHI will
be responsible for: Obtaining all necessary approvals to build, own and operate AQuarius Energy System; Securing a binding and
acceptable power purchase agreement (PPA) from the governmental authority; Providing the land for the Aquarius Energy System; Providing
the construction and civil engineering know-how to build the energy pools; Providing management, engineering and operational manpower
to build and operate the AQuarius Engineering System; and Providing the interconnection of the AQuarius Energy System to the national
grid. AQP’s
responsibilities include: Support PHI in obtaining the Power Purchase Agreement; Conduct a site survey and provide blueprints for
a tailor made Energy System; Provide technical support for the construction and operation of the Energy System (Includes training
for construction, installation and operations); Build, Ship, the AQuarius Energy System(s); and Install and commission the AQuarius
Energy System as required. AQuarius
Wave Energy System is a land-based wave energy system that uses a combination of gravity and “buoyancy” found within
the interaction between air and water to produce power that can be used to generate electricity and / or produce potable water.
AQuarius is a baseload zero carbon footprint that uses no consumables and can be installed virtually anywhere on the planet that
is cost effective against any fossil fuel alternatives. The system, which can be built turn-key within 6 months of obtaining permits,
has an operating life of over 60 years and is clean, scalable, reliable, and extremely flexible. Its operating cost is comparably
low as hydroelectric systems. On October
6, 2017, the Company signed a new Memorandum of Understanding (“MOU”) with AQuarius Power, Inc. to expand the scope
of cooperation and provide the same renewable energy technology to Eastern Europe and the European Region. For Eastern Europe the
Company is in the process of planning to build a pilot unit in Romania using AQP technology. PHI also intends to make additional
investments in AQP. As of the date of this report, the Company has made an investment of $5,000 in AQuarius Power, Inc. and intends
to continue making additional investments via purchase of AQP’s Common Stock. MASTER BUSINESS COOPERATION AGREEMENT
WITH THO XUAN DUONG JOINT STOCK COMPANY On August 14, 2017, the Company signed
a Master Business Cooperation Agreement with Tho Xuan Duong Joint Stock Company, a Vietnamese traditional medicine company with
400 years of history, to cooperate with each other in the following areas: (1) PHI will assist TXD to promote and advertise TXD’s
brand and traditional medicinal products and treatments on a global basis; (2) PHI will assist TXD to set up manufacturing facilities
and/or establish strategic alliances with pharmaceutical production and distribution companies in Europe, the United States, the
Middle East, Central and South America, Africa and other selective geographical areas; (3) PHI will assist TXD to access funding
sources to implement TXD’s business plan; (4) PHI will discuss and negotiate with TXD to consider an acquisition of equity
interest in TXD and/or exchange of ownership between TNB and PHI by way of stock swap to form a strategic alliance between the
two companies; (5) PHI and TXD will further discuss the potential of taking TXD public in the U.S. and/or European Stock Markets
to provide long-term financing capabilities for TXD’s development and growth; (6) PHI and TXD will cooperate to build and
develop raw material areas, preliminary and full-scale processing facilities for herbal medicines, and herbal medicine tourism
area in Sapa, Lao Cai Province, Northern Vietnam; (7) PHI will assist TXD to obtain special medical devices using Low Level Laser
Light Therapy technologies developed by American Laser Healthcare Corp., a US company, and cleared by the U.S. FDA for pain treatment,
needles acupuncture, diabetes Type 2, and 18 devices, as well as access other medical devices for TXD’s usage as needed;
and (8) PHI and TXD may jointly develop, manufacture and market other products and/or engage in other business activities that
may be of mutual interest to both parties. AGREEMENT TO ACQUIRE 51% OWNERSHIP IN
400-ACRE MINING CLAIMS IN GRANT COUNTY, OREGON AND CLOSING OF TRANSACTION On September 2, 2017, American Pacific
Resources, Inc., a Wyoming corporation (“APR”) and wholly owned subsidiary of the Company, entered into an Agreement
of Purchase and Sale with Rush Gold Royalty Inc, a Wyoming corporation, to acquire a 51% ownership in twenty-one mining claims
over an area of approximately 400 acres in Granite Mining District, Grant County, Oregon, U.S.A., in exchange for a total purchase
price of twenty-five million U.S. Dollars ($US 25,000,000) to be paid in a combination of $20 million in PHI Group, Inc.’s
Class A Series II Convertible Cumulative Redeemable Preferred Stock (“Preferred Stock”), and $5 million in a combination
of cash and a demand promissory note upon the closing of this contemplated transaction. The PHI Group’s
Class A Series II Preferred Stock is priced at $5 per share (“Original Price per Share”), carrying a cumulative dividend
rate of 8%, redeemable at 120% premium to the Original Price per Share, and convertible to Common Stock of PHI Group at 25% discount
any time after two years commencing its issuance or to Common Stock of APR at 50% discount to the market price when APR has become
a fully-reporting company. This transaction
was closed effective October 3, 2017. On April 19, 2018, Rush Gold Royalty,
Inc. (“RGRI”), American Pacific Resources, Inc. (“APRI”) and PHI Group, Inc. (“PHIL”) signed
an Amendment to the Agreement of Purchase and Sale dated September 2, 2017 among the same parties with respect to Article 2 of
said Agreement of Purchase and Sale as follows: a. RGRI shall surrender
and return to PHIL 4,000,000 shares of PHI Group, Inc.’s Series II Class A Convertible Cumulative Redeemable Preferred Stock,
Certificate No. P-A-II-001, that was issued to RGRI by PHIL on 10/3/2017 in connection with the Closing of the referenced Agreement
of Purchase and Sale. b. PHIL shall cancel
4,000,000 shares of PHI Group, Inc.’s Series II Class A Convertible Cumulative Redeemable Preferred Stock, Certificate No.
P-A-II-001, that was issued to RGRI on 10/3/2017 in connection with the Closing of the referenced Agreement of Purchase and Sale. c. APRI shall issue
4,000,000 shares of American Pacific Resources, Inc.’s Series I Class A Convertible Cumulative Redeemable Preferred Stock
to RGRI to replace the 4,000,000 shares of PHI Group, Inc.’s Series II Class A Convertible Cumulative Redeemable Preferred
Stock, Certificate No. P-A-II-001, issued to RGRI on 10/3/2017, that will have been cancelled by PHIL pursuant to this Amendment. On April 23,
2018, the Company’s Board of Directors passed a resolution to declare a twenty percent (20%) special stock dividend from
its holdings of Common Stock in American Pacific Resources, Inc., a subsidiary of the Company, to shareholders of Common Stock
of the Company as follows: (a) Declaration date: April 23, 2018; (b) Record date: May 31, 2018; (c) Payment date: October 31, 2018;
(d) Dividend ratio: All eligible shareholders of Common Stock of the Company as of the Record date shall be entitled to receive
two (2) shares of Common Stock of American Pacific Resources, Inc. for every ten (10) shares of Common Stock of PHI Group, Inc.
held by such shareholders as of the referenced Record date. TECHNICAL ASSISTANCE
AGREEMENT WITH AUBURN UNIVERSITY On September
25, 2017, the Company signed a Technical Assistance Agreement with Auburn University to conduct a research program in order to
determine the market segments related to supply and demand of medicinal and aromatic plants in the world, and then focus more specifically
on major production and consumption markets. The first four topics of the research program focus on the production, medicinal applications,
and market analysis of turmeric, saffron, bitter melon, and some major potential and aromatic plants. The last topic covers the
trends and solutions of switching from conventional farming to organic farming of these crops to meet the future food and medicinal
consumption. The research program began on October 1, 2017 and will end on September 30, 2018. APPOINTMENT
OF CHIEF TECHNOLOGY OFFICER AND ORGANIC FERTILIZER PROGRAM On October
28, 2017, Abundant Farms, Inc., a wholly owned subsidiary of PHI Group, Inc., signed an Employment Agreement with Mr. Lam Duong
and appointed the same as Chief Technology Officer/Chief Operation Officer for Abundant Farms. After a trial period of three months,
the Employment Agreement will be effective for three years and may be renewed by mutual consent of both the Company and the employee.
Mr. Duong will be responsible for all technological aspects of Abundant Farms, including the development of organic fertilizers
and other agricultural and medicinal products. Holding a Master
of Science in agriculture, Mr. Duong has held teaching and research positions at Nong Lam University, Vietnam, and Auburn University,
Alabama, U.S.A. during the last sixteen years. He has researched, developed and successfully produced organic fertilizer with his
proprietary formulations that has provided excellent results for a variety of crops. Mr. Duong will further enhance his methodologies
and start production of organic fertilizer for Abundant Farms in North America and Eastern Europe. AGREEMENT TO
DEVELOP A 67,000-ACRE GOLD MINING PROJECT IN LAOS On November
4, 2017, American Pacific Resources, Inc. (“APR”) (https://aprgold.com/) signed a Business Cooperation and Investment
Agreement with Suda Lattana Co., a Lao company, to develop a 67,000-acre gold mining project in the Province of Savannakhet, Laos. According to the Agreement, APR will
be responsible for financing and operating the gold mining project and will share a majority of the project’s net profits
after accounting for the costs of capital and operating expenses. It is estimated that 3,527,000 ounces of gold can be mined from
this concession, subject to further professional study and verification. The Agreement is valid until December 31, 2066. It has
been reported that Sepon, another gold mine in Savannakhet operated by Lane Xang Minerals Ltd., a majority-owned subsidiary of
MMG Company ( http://www.mmg.com/en/ AGREEMENT TO
SUPPLY PHARMACEUTICAL PRODUCTS, MEDICAL EQUIPMENT AND HEALTHCARE SUPPLIES TO LAOS. On November
4, 2017, Phivitae Corporation, a wholly owned subsidiary of the Company, signed a Business Cooperation Agreement with Suda Lattana
Co., a Lao company, to provide pharmaceutical products, medical equipment and healthcare supplies to Laos. According to
the Agreement, Phivitae Corp. will be responsible for identifying and forming strategic alliance with reputable international manufacturers
and suppliers in North America, European Union and India to provide pharmaceutical products, medical equipment and healthcare supplies
that meet or exceed international required standards to Laos and its neighboring markets. The term of the Agreement is for six
years and may be renewed every five years thereafter by mutual consent of both parties. BUSINESS CONSULANCY
AND STRUCTURING AGENCY AGREEMENT TO SET UP INSTITUTIONAL BANK FUNDS IN LUXEMBOURG On November
30, 2017, the Company signed an agreement with a structuring agent and legal experts to set up a bank fund in Luxembourg in order
to provide financing for the Company’s and its clients’ projects. The Reserved
Alternative Investment Fund (RAIF) can be established under the form of common funds (“FCP”), investment companies
with variable capital (“SICAV”) or under the form that does not have to have the legal form of a SICAV or an FCP. There
will be no restriction in terms of eligible assets. RAIFs are free to introduce any kind of assets and financial instruments in
their investment policy. According to the Luxembourg Law of July 12, 2013, RAIFs must entrust their assets to a Luxembourg custodian
bank for safekeeping and must appoint an approved statutory auditor. One of the
distinctive advantages of RAIF is that it may have various sub-funds, each corresponding to a distinct part of the assets and liabilities
of the RAIF. As such, sub-funds can be established under a RAIF umbrella to target different investment opportunities in a variety
of industries as desired. On February
21, 2018, the Company signed an amendment to the Business Consultancy and Structuring Agency Agreement to be solely responsible
for all the costs of Euros 3,500,000 associated with establishing the RAIF. INVESTMENT AGREEMENT WITH GRIDLINE COMMUNICATIONS,
INC. On December 15, 2017, PHI Group, Inc.
entered into an Investment Agreement with Gridline Communications, Inc. (“Gridline”) to form a special purpose vehicle
(“SPV”) under the name of Matrix Communications, Inc., as the holding company to acquire all the stock of Gridline
Communications and its sister company GridlineX as well as finance and implement Gridline’s high-speed broadband communications
business. According to the Investment Agreement,
the Matrix Communications will acquire all ownership and rights of the Investee in connection with high-speed broadband networks
and related supporting assets to serve government, commercial and consumer telephony, data and video needs in the Republic of Equatorial
Guinea as the first point of entry into the African Continent. Matrix Communications’ authorized capital will include 600
million shares of Common Stock and 300 million shares of Preferred Stock. PHI Group will be the sole holder of Common Stock in
the SPV initially and will retain fifteen percent equity interest thereof following the capitalization plan. This transaction has
not closed as of the date of this report. MEMORANDUM OF UNDERSTANDING TO BUILD
INDUSTRIAL PARK, GREENHOUSES, POWER PLANT AND WATER PARK IN TRANSYLVANIA, ROMANIA On December 18, 2017, PHI Group, Inc.
(the “Company”), entered into a Memorandum of Understanding (“MOU”) with SC Z.I.O.S. SRL, a Romanian company,
to develop an industrial park in Transylvania, Romania. According to the MOU, PHI Group will
cooperate with the owner of SC Z.I.O.S SRL to develop, build and operate a gas-fired power plant and greenhouses over the ZIOS
land parcel and water park adjacent to it. The Company is committed to investing
or causing to be invested the required capital to finance the building of a minimum 10-MW gas-fired power plant (renewable energy
with steam processing plant), the building of a minimum 10-hectares of greenhouse and investing 20 million Euros in a water park
and health retreat wellness resort taking advantage of the salt lakes adjacent to the ZIOS land parcel. Both parties agree to accept the value
of the ZIOS land parcel to be equivalent to seven (7) million Euros and acknowledge that ZIOS currently has a debt of 1.4 million
Euros on its books. The owner of SC Z.I.O.S. SRL agrees
to contribute 3.5 million Euros from value of the ZIOS land parcel toward the total capitalization to develop, build and operate
the gas-fired power plant, the greenhouse and the water park and will hold a proportionate percentage of ownership in the entity
that owns these projects based on the total capitalization amount during the first two years. PHI Group agrees to pay or cause to
be paid to owner of SC Z.I.O.S. SRL two (2) million Euros after the all required approvals and permits are granted by the pertinent
Romanian governmental authorities to build the gas-fired power plant, the greenhouse and the water park. This sum of money and
the payment of 1.4 million Euros to the Z.I.O.S. creditor will come from the structured financing in connection with the capitalization
for these projects, unless agreed otherwise by the pertinent parties afterwards. In addition, the balance of 1.5 million Euros
will be paid to the owner of SC Z.I.O.S. SRL over a period of 5 years based on cash flow milestones from operations. The Company and SC Z.I.O.S. SRL will
proceed towards the signing of a definitive agreement to consummate the transactions mentioned herein between the two parties or
as soon as practical. MEMORANDUM
OF UNDERSTANDING WITH VIETNAM GREEN AGRICULTURE COMPANY LTD. On January
3, 2018, the Company signed a Memorandum of Understanding (“MOU”) with Vietnam Green Agriculture Company, Ltd. (“VinaXanh”)
to cooperate in the manufacture and sale of bio-organic fertilizer products developed by VinaXanh, both in Vietnam and in international
markets. VinaXanh has
successfully formulated and tested proprietary bio-organic fertilizer and obtained the required governmental licenses to produce
about half a dozen products using amino acids, peptides, fulvic acid, organic chelates, and other organic ingredients. VinaXanh
fertilizer products have been effectively applied to numerous plants and crops in Vietnam, including black pepper, coffee, orange,
lime, tangerine, grapefruit, jackfruit, dragon fruit, red pepper, tea, rice, etc. and have been granted fifteen different awards
for excellence from 2015 to 2017. VinaXanh fertilizer has shown to be especially potent in combatting the deadly greening disease. PHI Group intends
to work with VinaXanh to boost the production and sale of these bio-organic fertilizer products in Vietnam and also integrate certain
applicable aspects of VinaXanh’s methodologies into Abundant Farms, Inc.’s organic fertilizer program in the U.S. and
Romania. In addition, the Company plans to incorporate the special water treatment system by PHI EZ Water Tech, Inc., a subsidiary
of PHI Group, (www.phiezwater.com) with VinaXanh’s products to optimize plant health and crop yields for farmers in Vietnam. BLOCKCHAIN TECHNOLOGY CONSULTING SERVICE
AGREEMENT On February 23, 2018, the Company signed
a consulting service agreement with International Blockchain Consulting (“IBC”), an Australian company, to provide
information, evaluation and consulting services to the Company in IBC’s areas of knowledge and expertise, including but not
limited to all the technical, legal, financial and marketing support services required to launch a successful ICO. IBC agrees to perform services for the
Company to launch an ICO for Asia Diamond Exchange (“ADE”), a subsidiary of PHI Group to be established in Singapore
or another foreign country, or for any other entity the Company elects to engage that may be approved and adopted by PHI Group
for use in its business strategy. As such, IBC will be providing bona fide services to PHI Group and/or its customers. The services
to be provided by IBC will not be in connection with the offer or sale of securities in a capital-raising transaction, and will
not directly or indirectly promote or maintain a market for PHI Group’s securities. AGREEMENTS WITH VIETNAMESE COMPANIES
TO GROW SACHA INCHI In March 2018, the Company signed agreements
with Bao Lam LLC, a company registered in the Province of Dak Lak Province, and Phuong Hoang Investment and Development LLC, a
company registered in Ha Tinh Province, Vietnam, to grow a total of 3,000 hectares (approximately 7,400 acres) of sacha inchi in
the provinces of Dak Lak, Dak Nong and Thua Thien Hue for export to the U.S. and European markets. Originally from the Amazon rainforest
and the high Andes Mountains of Peru, sacha inchi has been part of the Inca diet for 3,000 years. The sacha inchi plant, plukenetia
volubilis, a rainforest vine, with star-shaped seed pods, is currently cultivated primarily in parts of Southeast Asia and South
America. Sacha inchi has been recognized for a number of health benefits such as complete protein, weight loss, heart health, bone
health, and skin and hair health. According to the agreements, the Company
will be responsible for providing the required capital for these projects and will own 70-75% equity interest in the joint venture
companies. AGREEMENT BETWEEN
AMERICAN PACIFIC RESOURCES, INC. AND GILDEXSHOP On February
28, 2018, American Pacific Resources, Inc. (“APRI”), a subsidiary of the Company, signed a Business Cooperation with
GildexShop Pte Ltd. (“GLDX”), a company to be established in Singapore. According to the agreement, APRI and GLDX will
primarily cooperate with each other to accomplish the following objectives: 1. Capitalization of APRI: GLDX will
issue and circulate a certain amount of cryptocurrency tokens using blockchain technology in order to raise capital for APRI to
implement its business plan. 2. Using APRI’s assets as guarantee
for GLDX ICO’s: APRI agrees to guarantee the value of the GLDX ICO tokens pursuant to the following terms and conditions: a. In the event
the trading prices of GLDX ICO tokens fall below their original purchase prices anytime after GLDX tokens are listed on a reputable
cryptocurrency exchange, APRI agrees to guarantee the value of all such GLDX ICO tokens that are purchased by investors by allowing
the token holders to exchange the original purchase prices of such ICO tokens for gold from APRI at 50% discount to the Market
Price (as defined herein) of gold at the time of exchange. Market Price shall mean the 10-day average closing spot price of gold
on the London Metal Exchange (LME) immediately prior to the date of the request for exchange by the ICO token holders. b. Holders of GLDX
ICO tokens may select one of the following options for the receipt of the APRI gold guarantee: (i). Receipt of
physical gold bar(s) from APRI or its affiliate(s). (ii). Receipt of
Ethereum or alternatively acceptable crytocurrencies equivalent to the value of the original ICO purchase prices. (iii) Receipt of
cash through wire transfer to token-holder’s bank account after sale of the guarantee gold position(s). 3. GLDX shall be responsible for providing
the required capital for APRI to set up the processing facilities to recover gold and other precious metals from its Gold Assets.
The amounts of capital to be provided to APRI by GLDX will be done in tranches and based on a schedule of funding and use of proceeds
to be determined and agreed upon by both APRI and GLDX. 4. APRI covenants and warrants that
it shall sell refined gold and other products of precious metals from its Gold Assets to GLDX at 50% discount to Market Price as
defined above until GLDX has recovered at least twice the amount(s) of its capital investment in APRI or the end of the five-year
term of this Agreement, whichever occurs later. 5. Compliance with Various Jurisdictions
and the Requirements of the U.S. Securities and Exchange Commission: GLDX shall strictly comply with the requirements of the appropriate
jurisdictions with respect to the offerings of its GLDX ICO tokens and shall not offer any of such tokens to U.S. investors unless
and until it has met all the requirements of the U.S. Securities and Exchange Commission in connection with the o |
