| RELATED PARTY BALANCES AND TRANSACTIONS |
NOTE 23
— RELATED PARTY BALANCES AND TRANSACTIONS
The table below sets forth major related parties
of the Company and their relationships with the Company.
| Name | | Relationship with the Company |
| Mr. Tsai Ming Hsing, Richard (“Mr. Tsai”) | | Controlling stockholder of the Company | | Mr. Ng Wing Fai (“Mr. Ng”) | | Chief Executive Officer and Executive Director of the Company | | Mr. Robert E. Diamond, Jr. (“Diamond”) | | Former chairman of the Company (resigned on December 12, 2024) | | Ms. Wong Suet Fai Almond | | Chief Operating Officer of the Company | | TAG Holdings Limited | | Stockholder and immediate holding company of the Company | | TAG Financial Holdings Limited | | Company controlled by Mr. Tsai | | Convoy Financial Services Limited | | Company controlled by Mr. Tsai | | Convoy Global Holdings Limited | | Company controlled by Mr. Tsai | | Giant Wisdom Ventures Limited | | Company controlled by Mr. Tsai | | Green Nature Limited | | Company controlled by Mr. Tsai | | Total Formation Inc. | | Stockholder of the Company and company controlled by Mr. Tsai | | JFA Capital | | Investment private funds controlled by Mr. Tsai | | NSD Capital | | Investment private funds controlled by Mr.
Tsai | | Atlas Merchant Capital LLC | | Company controlled by Diamond | | DeSilva 2000 Living Trust | | Company controlled by director of subsidiaries of the Company | | HCMPS Healthcare Holdings Limited | | Company with common director – Mr. Ng |
In support of the Company’s efforts and cash requirements, it
may rely on advances from related parties until such time that the Company can support its operations or attains adequate financing through
sales of its equity or traditional debt financing. There is no formal written commitment for continued support by the stockholder. Amounts
represent advances or amounts paid in satisfaction of liabilities.
| (i) | Related party balances |
Related party balances consisted of the following:
| | |
| |
As of December 31, | |
| | |
| |
2024 | | |
2023 | |
| | |
| |
| | |
| |
| Balance with related parties: | |
| |
| | |
| |
| Accounts receivable | |
(a) | |
$ | — | | |
$ | 1,094 | |
| Other current liabilities | |
(b) | |
$ | 1,251 | | |
$ | — | |
| Borrowings | |
(c) | |
$ | 29,181 | | |
$ | 5,000 | |
| Amount due to stockholder | |
(d) | |
$ | — | | |
$ | 2,906 | |
| Long-term investment – Investment E | |
(e) | |
$ | 525 | | |
$ | 523 | |
| Convertible debts | |
(f) | |
$ | 53,106 | | |
$ | — | |
| (a) | Accounts receivable due from related parties represented the management service rendered to two individual close-ended investment private funds registered in the Cayman Islands, which are controlled by the controlling stockholder of the Company. |
| (b) | Other current liabilities due to related parties represented the interest
payable accrued on the short-term borrowings from four related parties (see Note 15(c)). |
| (c) | Borrowings consisted of short-term loans obtained from the Company’s Chief Operating Officer, TAG Holdings Limited, Giant Wisdom Ventures Limited and DeSilva 2000 Living Trust. The amounts were secured, interest-bearing and repayable on demand (see Note 15(c)). | | (d) | Amount due to stockholder are those nontrade payables arising from transactions between the Company and TAG Holdings Limited, such as advances made by TAG Holdings Limited on behalf of the Company, advances made by the Company on behalf of TAG Holdings Limited, and allocated shared expenses paid by TAG Holdings Limited. During the years ended December 31, 2024 and 2023, amounts due to stockholder of nil and $12.6 million, respectively, were forgiven (see Note 19(f)). |
| (e) | In May 2021, the Company purchased 4% equity interest in HCMPS Healthcare Holdings Limited, which has common director with the Company, based on
historical cost. |
| (f) | The convertible debts obtained from Total Formation Inc. and Giant
Wisdom Ventures Limited. (see Note 16). |
| (ii) | Transactions with related parties |
In the ordinary course of business, during the
years ended December 31, 2024 and 2023, the Company involved with transactions, either at cost or current market prices and on the normal
commercial terms among related parties. The following table provides the transactions with these parties for the periods as presented
(for the portion of such period that they were considered related):
| | |
| |
For the years ended
December 31, | |
| | |
| |
2024 | | |
2023 | |
| | |
| |
| | |
| |
| Asset management service income | |
(g) | |
$ | - | | |
$ | 970 | |
| Office rental and operating fees | |
(h) | |
$ | 4,303 | | |
$ | 6,040 | |
| Legal and professional fees | |
(i) | |
$ | 949 | | |
$ | 333 | |
| Interest expense | |
(j) | |
$ | 1,024 | | |
$ | - | |
| (g) | Under the management agreements, the Company shall provide management service to the portfolio assets held by two individual close-ended investment private funds in the Cayman Islands, which are controlled by the controlling stockholder of the Company, for a compensation of asset management service fee income at the predetermined rate based on the respective portfolio of asset values invested by the final customers. |
| (h) | Pursuant to the service agreement, the Company agreed to pay the office and administrative expenses to
TAG Holdings Limited and Convoy Financial Services Limited for the use of office premises, including, among other things, building management fees, government rates and rent,
office rent, and lease-related interest and depreciation that were actually incurred. |
| (i) | On September 19, 2023, the Company entered into an advisory services agreement with Atlas Merchant Capital LLC, a company controlled by its former chairman, for a monthly fee of approximately $0.8 million. The service will be terminated by either party upon 90 days prior written notice. |
| (j) | The
interest expense incurred for borrowings from four related parties (see Note 15(c)). |
Apart from the transactions and balances detailed
above and elsewhere in these accompanying consolidated financial statements, the Company has no other significant or material related
party transactions during the years presented.
|