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Phi Group Inc. – ‘1-A’ on 2/9/22 – ‘PART II AND III’

On:  Wednesday, 2/9/22, at 9:27am ET   ·   Accession #:  1493152-22-3542   ·   File #:  24-11801

3 References:   By:  Phi Group Inc. – ‘10-K’ on 10/13/23 for 6/30/23 By:  Phi Group Inc. – ‘10-K/A’ on 1/17/23 for 6/30/22 To:  Phi Group Inc. – ‘SB-2’ on 1/29/03 

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  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/09/22  Phi Group Inc.                    1-A                    5:1.8M                                   M2 Compliance LLC/FA

Document/Exhibit                   Description                      Pages   Size 

 1: 1-A         Offering Statement -- primary_doc.xml               HTML      3K 
 2: PART II AND III  Offering Statement - Parts II and III          HTML    820K 
 3: ADD EXHB    Miscellaneous Exhibit                               HTML     58K 
 4: ADD EXHB    Miscellaneous Exhibit                               HTML      7K 
 5: ADD EXHB    Miscellaneous Exhibit                               HTML     10K 

As filed with the Securities and Exchange Commission on February 9, 2022

PART II - INFORMATION REQUIRED IN OFFERING CIRCULAR

Preliminary Offering Circular dated February 9, 2022

An offering statement pursuant to Regulation A relating to these securities has been filed with the United States Securities and Exchange Commission (the “SEC”). Information contained in this Preliminary Offering Circular is subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted before the offering statement filed with the SEC is qualified. This Preliminary Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy nor may there be any sales of these securities in any state in which such offer, solicitation or sale would be unlawful before registration or qualification under the laws of any such state. We may elect to satisfy our obligation to deliver a Final Offering Circular by sending you a notice within two business days after the completion of our sale to you that contains the URL where the Final Offering Circular or the offering statement in which such Final Offering Circular was filed may be obtained.

OFFERING CIRCULAR

PHI Group, Inc.

3,750,000,000 Shares of Common Stock

By this Offering Circular, PHI Group, Inc., a Wyoming corporation, is offering for sale a maximum of 3,750,000,000 shares of its common stock (the “Offered Shares”), at a fixed price of $0.015-$0.050 per share, pursuant to Tier 2 of Regulation A of the United States Securities and Exchange Commission (the “SEC”). A minimum purchase of $1,000 of the Offered Shares is required in this offering; any additional purchase must be in an amount of at least $500. This offering is being conducted on a best-efforts basis, which means that there is no minimum number of Offered Shares that must be sold by us for this offering to close; thus, we may receive no or minimal proceeds from this offering. All proceeds from this offering will become immediately available to us and may be used as they are accepted. Purchasers of the Offered Shares will not be entitled to a refund and could lose their entire investments. Please see the “Risk Factors” section, beginning on page 5, for a discussion of the risks associated with a purchase of the Offered Shares.

We estimate that this offering will commence on or around March 4, 2022; this offering will terminate at the earliest of (a) the date on which the maximum offering has been sold, (b) the date which is one year from this offering being qualified by the SEC or (c) the date on which this offering is earlier terminated by us, in our sole discretion. (See “Plan of Distribution”).

Our common stock is quoted in the over-the-counter under the symbol “PHIL” in the OTC Pink marketplace of OTC Link. On February 8, 2022, the closing price of our common stock was $0.0036 per share.

Investing in the Offered Shares is speculative and involves substantial risks, including the superior voting rights of our outstanding shares of Class B Series I Preferred Stock, which could have the effect of precluding current and future owners of our common stock, including the Offered Shares, from influencing any corporate decision. You should purchase such securities only if you can afford a complete loss of your investment. See Risk Factors, beginning on page 5, for a discussion of certain risks that you should consider before purchasing any of the Offered Shares.

Each share of Class B Series I Preferred Stock is entitled to notice of any shareholders’ meeting or action as to such matters on the same basis as the holders of our common stock, and the holders of our common stock and shares of Class B Series I Preferred Stock vote together or act together thereon, as if a single class on all such matters; provided, however, that in such voting or action, each one share of Class B Series I Preferred Stock shall be entitled to 100,000 votes. Our officers and directors, as a group, as the owners of 100% of all outstanding shares of the Class B Series I Preferred Stock, possess effective and absolute control the management and affairs of our company, as well as matters requiring the approval by our shareholders, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets, and any other significant corporate transaction. (See “Risk Factors—Risks Related to a Purchase of the Offered Shares”).

THE SEC DOES NOT PASS UPON THE MERITS OF, OR GIVE ITS APPROVAL TO, ANY SECURITIES OFFERED OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE SEC. HOWEVER, THE SEC HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.

The use of projections or forecasts in this offering is prohibited. No person is permitted to make any oral or written predictions about the benefits you will receive from an investment in Offered Shares.

No sale may be made to you in this offering, if you do not satisfy the investor suitability standards described in this Offering Circular under “Plan of Distribution—State Law Exemption and Offerings to ‘Qualified Purchasers’” (page 11). Before making any representation that you satisfy the established investor suitability standards, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general information on investing, we encourage you to refer to www.investor.gov.

This Offering Circular follows the disclosure format of Form S-1, pursuant to the General Instructions of Part II(a)(1)(ii) of Form 1-A.

The date of this Offering Circular is _________, 2022.

TABLE OF CONTENTS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

The information contained in this Offering Circular includes some statements that are not historical and that are considered forward-looking statements. Such forward-looking statements include, but are not limited to, statements regarding our development plans for our business; our strategies and business outlook; anticipated development of our company; and various other matters (including contingent liabilities and obligations and changes in accounting policies, standards and interpretations). These forward-looking statements express our expectations, hopes, beliefs and intentions regarding the future. In addition, without limiting the foregoing, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words anticipates, believes, continue, could, estimates, expects, intends, may, might, plans, possible, potential, predicts, projects, seeks, should, will, would and similar expressions and variations, or comparable terminology, or the negatives of any of the foregoing, may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.

The forward-looking statements contained in this Offering Circular are based on current expectations and beliefs concerning future developments that are difficult to predict. We cannot guarantee future performance, or that future developments affecting our company will be as currently anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements.

All forward-looking statements attributable to us are expressly qualified in their entirety by these risks and uncertainties. These risks and uncertainties, along with others, are also described below in the Risk Factors section. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. You should not place undue reliance on any forward-looking statements and should not make an investment decision based solely on these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

OFFERING CIRCULAR SUMMARY

The following summary highlights material information contained in this Offering Circular. This summary does not contain all of the information you should consider before purchasing our common stock. Before making an investment decision, you should read this Offering Circular carefully, including the Risk Factors section and the consolidated financial statements and the notes thereto. Unless otherwise indicated, the terms “we”, “us” and “our” refer and relate to PHI Group, Inc., including our subsidiaries: (a)PHILUX Global Funds SCA, SICAV-RAIF, a Luxembourg corporation, (b) PHI Luxembourg Development SA, a Luxembourg corporation, (c) PHI Luxembourg Holding SA, a Luxembourg corporation, (d) PHILUX Global General Partner SA, a Luxembourg corporation, (e) PHILUX Capital Advisors, Inc., a Wyoming corporation, (f) PHI Vietnam Investment & Development Co., Ltd., a Vietnamese limited liability company, (g) Asia Diamond Exchange, Inc., a Wyoming corporation, (h) Vinafilms International, Inc. (formerly American Pacific Plastics, Inc.), a Wyoming corporation, (i) American Pacific Resources, Inc., a Wyoming corporation, (j) PHIVITAE Healthcare, Inc., a Wyoming corporation, (k) CO2-1-0 (Carbon) Corp., a Wyoming corporation, (l) Empire Spirits, Inc. (formerly Provimex, Inc.), a Nevada corporation, and (m) PHILUX Global Energy, Inc., a Wyoming corporation.

Our Company

Originally incorporated on June 8, 1982, as JR Consulting, Inc., a Nevada corporation, our company applied for a Certificate of Domestication and filed Articles of Domestication to become a Wyoming corporation on September 20, 2017.

From inception, our company was foremost engaged in mergers and acquisitions and had an operating subsidiary, Diva Entertainment, Inc., which operated two modeling agencies, one in New York and one in California. In January 2000, we changed our corporate name to “Providential Securities, Inc.” (while a Nevada corporation), following a business combination with Providential Securities, Inc., a California-based financial services company. In February 2000, we then changed our corporate name to “Providential Holdings, Inc.” (while a Nevada corporation). In October 2000, our company withdrew our securities brokerage membership and ceased our financial services business.

From October 2000 to October 2011, the Company and its subsidiaries were engaged in mergers and acquisitions advisory and consulting services, real estate and hospitality development, mining, oil and gas, telecommunications, technology, healthcare, private equity, and special situations. In April 2009, we changed our corporate name to “PHI Group, Inc.” (while a Nevada corporation).

In October 2011, we discontinued the operations of Providential Vietnam Ltd., Philand Ranch Limited, a United Kingdom corporation (together with its subsidiaries Philand Ranch - Singapore, Philand Corporation - US, and Philand Vietnam Ltd. - Vietnam), PHI Gold Corporation (formerly PHI Mining Corporation, a Nevada corporation), and PHI Energy Corporation (a Nevada corporation), and mainly focused on acquisition and development opportunities in energy and natural resource businesses.

We are currently focused the development on PHILUX Global Funds, SCA, SICAV-RAIF, by launching a number of sub-funds for investment in real estate, renewable energy, infrastructure, agriculture and healthcare and on developing and establishing the Asia Diamond Exchange in Vietnam. In addition, PHILUX Capital Advisors, Inc. (formerly Capital Holdings, Inc.), a wholly owned subsidiary of our company, continues to provide corporate and project finance services, including merger and acquisition advisory and consulting services for U.S. and international companies. Recently, we signed agreements to acquire 70% ownership in Five-Grain Treasure Spirits Company, Ltd., a baiju distiller located in Jilin Province, China, for $100,000,000 and 50.10% ownership in Kota Energy Group LLC and Kota Construction LLC for $64,125,000. No assurances can be made that we will be successful in achieving our plans, in this regard. (See “Business”).

Offering Summary

Continuing Reporting Requirements Under Regulation A

We are required to file periodic and other reports with the SEC, pursuant to the requirements of Section 13(a) of the Securities Exchange Act of 1934. Our continuing reporting obligations under Regulation A are deemed to be satisfied, as long as we comply with our Section 13(a) reporting requirements. As a Tier 2 issuer under Regulation A, we will be required to file with the SEC a Form 1-Z (Exit Report Under Regulation A) upon the termination of this offering.

RISK FACTORS

An investment in the Offered Shares involves substantial risks. You should carefully consider the following risk factors, in addition to the other information contained in this Offering Circular before purchasing any of the Offered Shares. The occurrence of any of the following risks might cause you to lose a significant part of your investment. The risks and uncertainties discussed below are not the only ones we face, but do represent those risks and uncertainties that we believe are most significant to our business, operating results, prospects and financial condition. Some statements in this Offering Circular, including statements in the following risk factors, constitute forward-looking statements.

Risks Related to Our Company

Our independent auditor’s report for the fiscal years ended June 30, 2021 and 2020, is qualified as to our ability to continue as a going concern. Due to the uncertainty of our ability to meet our current operating and capital expenses, in our audited annual consolidated financial statements for the years ended June 30, 2021 and 2020, our independent auditor included a note to our consolidated financial statements regarding concerns about our ability to continue as a going concern. Recurring losses from operations raise substantial doubt about our ability to continue as a going concern. The presence of the going concern note to our consolidated financial statements may have an adverse impact on the relationships we are developing and plan to develop with third parties as we continue the development of our business and could make it challenging and difficult for us to raise additional financing, all of which could have a material adverse impact on our business and prospects and result in a significant or complete loss of your investment.

We have incurred significant losses in prior periods, and losses in the future could cause the quoted price of our common stock to decline or have a material adverse effect on our financial condition, our ability to pay our debts as they become due, and on our cash flows. We have incurred significant losses in prior periods. For the three months ended September 30, 2021, we incurred a net loss of $5,960,170 (unaudited) and, as of that date, we had an accumulated deficit of $56,523,700 (unaudited). For the year ended June 30, 2021, we incurred a net loss of $6,553,178 and, as of that date, we had an accumulated deficit of $50,563,530. For the year ended June 30, 2020, we incurred a net loss of $1,321,805 and, as of that date, we had an accumulated deficit of $44,010,352. Any losses in the future could cause the quoted price of our common stock to decline or have a material adverse effect on our financial condition, our ability to pay our debts as they become due, and on our cash flows.

It is possible that the novel Coronavirus pandemic could cause long-lasting stock market volatility and weakness, as well as long-lasting recessionary effects on the United States and/or global economies. Should the negative economic impact caused by the novel Coronavirus pandemic result in long-term economic weakness in the United States and/or globally, our ability to establish our business would be severely negatively impacted. It is possible that our company would not be able to sustain during any such long-term economic weakness.

We may be unable to obtain sufficient capital to pursue our growth strategy. We do not possess sufficient financial resources to implement our complete business plan. We are currently seeking available sources of capital. There is no assurance that we will obtain needed capital, nor is there any assurance that our business will be able to generate revenues that are sufficient to sustain our operations. We are not able to offer assurance that we will be able to obtain needed sources of financing to satisfy our working capital needs.

We do not have a successful operating history. We are without a history of successful business operations, which makes a purchase of Offered Shares speculative in nature. Additionally, our operations are subject to certain risks, including, among other factors, efficiently deploying our capital and executing our business plan.

We may not be successful in executing our business plan. We are unable to offer assurance that we will be successful in expanding our current business, developing our planned business activities and earning a profit from such efforts. Should we fail to implement successfully our business plan, you can expect to lose your entire investment in the Offered Shares.

We may never earn a profit. Because we lack a successful operating history, we are unable to offer assurance that we will ever earn a profit from our operations.

If we are unable to manage future expansion effectively, our business may be adversely impacted. In the future, we may experience rapid growth in our business, which could place a significant strain on our operations, in general, and our internal controls and other managerial, operating and financial resources, in particular. If we are unable to manage future expansion effectively, our business would be harmed. There is, of course, no assurance that we will enjoy rapid development in our business.

We currently depend on the efforts of one of our executive officers; the loss of this officer could disrupt our operations and adversely affect the development of our business. Our success in effectuating our business plan will depend, primarily, on the continued service of our President, Henry D. Fahman. We have not yet entered into an employment agreement with Mr. Fahman. (See “Executive Compensation”). The loss of service of Mr. Fahman, for any reason, could seriously impair our ability to effectuate our business plan, which could have a materially adverse effect on our business and future results of operations. We have not purchased any key-man life insurance.

If we are unable to recruit and retain key personnel, our business may be harmed. If we are unable to attract and retain key personnel, our business may be harmed. Our failure to enable the effective transfer of knowledge and facilitate smooth transitions with regard to our key employees could adversely affect our long-term strategic planning and execution.

Our business plan is not based on independent market studies. We have not commissioned any independent market studies concerning our business plans. Rather, our plans for implementing our business strategy and achieving profitability are based on the experience, judgment and assumptions of our management. If these assumptions prove to be incorrect, we may not be successful in our business operations.

Our Board of Directors may change our policies without shareholder approval. Our policies, including any policies with respect to investments, leverage, financing, growth, debt and capitalization, will be determined by our Board of Directors or officers to whom our Board of Directors delegate such authority. Our Board of Directors will also establish the amount of any dividends or other distributions that we may pay to our shareholders. Our Board of Directors or officers to which such decisions are delegated will have the ability to amend or revise these and our other policies at any time without shareholder vote. Accordingly, our shareholders will not be entitled to approve changes in our policies, which policy changes may have a material adverse effect on our financial condition and results of operations.

Risks Related to Our Business

We may not be able to compete effectively in our intended markets. None of our products enjoys name recognition and many of our competitors possess substantially greater resources, financial and otherwise, than does our company. There is no assurance that we will be able to establish our business and compete successfully in this environment.

We may suffer sluggish or negative sales growth as a result of the novel Coronavirus pandemic. It is possible that the negative economic impact caused by the novel Coronavirus pandemic will result in long-term economic weakness in the United States and/or globally and our ability to establish our business would be severely negatively impacted. It is possible that our company would not be able to survive as a going business during any such long-term economic weakness.

If we fail to maintain a positive reputation with customers, we may not be able to attract business, and our operating results may be adversely affected. We believe a positive reputation with customers to be highly important in developing our business. To the extent we are not perceived positively to potential customers, our ability to expand our operations may be adversely impacted.

Risks Related to Our Organization and Structure

Our holding company structure makes us dependent on our subsidiaries for our cash flow and could serve to subordinate the rights of our shareholders to the rights of creditors of our subsidiaries, in the event of an insolvency or liquidation of any such subsidiary. Our company acts as a holding company and, accordingly, substantially all of our operations are conducted through our subsidiaries. Such subsidiaries will be separate and distinct legal entities. As a result, substantially all of our cash flow will depend upon the earnings of our subsidiaries. In addition, we will depend on the distribution of earnings, loans or other payments by our subsidiaries. No subsidiary will have any obligation to provide our company with funds for our payment obligations. If there is an insolvency, liquidation or other reorganization of any of our subsidiaries, our shareholders will have no right to proceed against their assets. Creditors of those subsidiaries will be entitled to payment in full from the sale or other disposal of the assets of those subsidiaries before our company, as a shareholder, would be entitled to receive any distribution from that sale or disposal.

Risks Related to a Purchase of the Offered Shares

We may seek capital that may result in shareholder dilution or that may have rights senior to those of our common stock, including the Offered Shares. From time to time, we may seek to obtain additional capital, either through equity, equity-linked or debt securities. The decision to obtain additional capital will depend on, among other factors, our business plans, operating performance and condition of the capital markets. If we raise additional funds through the issuance of equity, equity-linked or debt securities, those securities may have rights, preferences or privileges senior to the rights of our common stock, which could negatively affect the market price of our common stock or cause our shareholders to experience dilution.

We do not intend to pay dividends on our common stock. We intend to retain earnings, if any, to provide funds for the implementation of our business strategy. We do not intend to declare or pay any dividends in the foreseeable future. Therefore, there can be no assurance that holders of our common stock will receive cash, stock or other dividends on their shares of our common stock, until we have funds which our Board of Directors determines can be allocated to dividends.

Our common stock is a “Penny Stock,” which may impair trading liquidity. Disclosure requirements pertaining to penny stocks may reduce the level of trading activity in the market for our common stock and investors may find it difficult to sell their shares. Trades of our common stock will be subject to Rule 15g-9 of the SEC, which rule imposes certain requirements on broker-dealers who sell securities subject to the rule to persons other than established customers and accredited investors. For transactions covered by the rule, broker-dealers must make a special suitability determination for purchasers of the securities and receive the purchaser’s written agreement to the transaction prior to sale. The SEC also has rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in that security is provided by the exchange or system). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation.

It is possible that our common stock can be expected to experience highly volatile in its market price. Our common stock is quoted in the over-the-counter market under the symbol “PHIL” in the OTC Pink marketplace of OTC Link. The market for low-priced securities is generally less liquid and more volatile than securities traded on national stock markets. Wide fluctuations in market prices are not uncommon. No assurance can be given that the market for our common stock will become less volatile.

The price of our common stock may be subject to wide fluctuations in response to factors such as the following, some of which are beyond our control:

The outstanding shares of our Class B Series I Preferred Stock effectively preclude current and future owners of our common stock from influencing any corporate decision. Our officers and directors, as a group, as the owners of 100% of all outstanding shares of our Class B Series I Preferred Stock, will be able effectively to control the management and affairs of our company, as well as matters requiring the approval by our shareholders, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets, and any other significant corporate transaction. Each share of Class B Series I Preferred Stock is entitled to notice of any shareholders’ meeting or action as to such matters on the same basis as the holders of our common stock, and the holders of our common stock and shares of Class B Series I Preferred Stock vote together or act together thereon, as if a single class on all such matters; provided, however, that in such voting or action, each one share of Class B Series I Preferred Stock shall be entitled to 100,000 votes.

You will suffer dilution in the net tangible book value of the Offered Shares you purchase in this offering. If you acquire any Offered Shares, you will suffer immediate dilution, due to the lower book value per share of our common stock compared to the purchase price of the Offered Shares in this offering. (See “Dilution”).

Future sales of our common stock, or the perception in the public markets that these sales may occur, could reduce the market price of our common stock. Approximately 95% of our currently issued and outstanding common stock is free-trading in nature. In addition, we have outstanding numerous convertible debt instruments that are presently eligible for conversion into free-trading shares of our common stock. The availability for sale of substantial amounts of our common stock upon conversion of such debt instruments could reduce prevailing market prices for our common stock. (See “Convertible Promissory Notes—Description of Securities”).

Future issuances of debt securities and equity securities could negatively affect the market price of shares of our common stock and, in the case of equity securities, may be dilutive to existing shareholders. In the future, we may issue debt or equity securities or incur other financial obligations, including stock dividends. Upon liquidation, it is possible that holders of our debt securities and other loans and preferred stock would receive a distribution of our available assets before common shareholders. We are not required to offer any such additional debt or equity securities to existing shareholders on a preemptive basis. Therefore, additional common stock issuances, directly or through convertible or exchangeable securities, warrants or options, would dilute the holdings of our existing common shareholders and such issuances, or the perception of such issuances, could reduce the market price of shares of our common stock.

As an issuer of penny stock, the protection provided by the federal securities laws relating to forward-looking statements does not apply to us. Although federal securities laws provide a safe harbor for forward-looking statements made by a public company that files reports under the federal securities laws, this safe harbor is not available to issuers of penny stocks. As a result, we will not have the benefit of this safe harbor protection, in the event of any legal action based upon a claim that the material provided by us contained a material misstatement of fact or was misleading in any material respect because of our failure to include any statements necessary to make the statements not misleading. Such an action could hurt our financial condition.

DILUTION

Dilution in net tangible book value per share to purchasers of our common stock in this offering represents the difference between the amount per share paid by purchasers of the Offered Shares in this offering and the pro forma as adjusted net tangible book value per share immediately after completion of this offering. In this offering, dilution is attributable primarily to our relatively low net tangible book value per share.

If you purchase Offered Shares in this offering, your investment will be diluted to the extent of the difference between your purchase price per Offered Share and the net pro forma as adjusted tangible book value per share of our common stock after this offering. Our net tangible book value as of September 30, 2021, was $(2,514,670) (unaudited), or $(0.0001) per share.

The tables below illustrate the dilution to purchasers of Offered Shares in this offering, on a pro forma basis, assuming 100%, 75%, 50% and 25% of the Offered Shares are sold.

USE OF PROCEEDS

The table below sets forth the estimated proceeds we would derive from this offering, assuming the sale of 25%, 50%, 75% and 100% of the Offered Shares and assuming the payment of no sales commissions or finder’s fees. There is, of course, no guaranty that we will be successful in selling any of the Offered Shares in this offering.

The table below sets forth the manner in which we intend to apply the net proceeds derived by us in this offering, assuming the sale of 25%, 50%, 75% and 100% of the Offered Shares. All amounts set forth below are estimates.

We reserve the right to change the foregoing use of proceeds, should our management believe it to be in the best interest of our company. The allocations of the proceeds of this offering presented above constitute the current estimates of our management and are based on our current plans, assumptions made with respect to the industries in which we currently or, in the future, expect to operate, general economic conditions and our future revenue and expenditure estimates.

Investors are cautioned that expenditures may vary substantially from the estimates presented above. Investors must rely on the judgment of our management, who will have broad discretion regarding the application of the proceeds of this offering. The amounts and timing of our actual expenditures will depend upon numerous factors, including market conditions, cash generated by our operations (if any), business developments and the rate of our growth. We may find it necessary or advisable to use portions of the proceeds of this offering for other purposes.

In the event we do not obtain the entire offering amount hereunder, we may attempt to obtain additional funds through private offerings of our securities or by borrowing funds. Currently, we do not have any committed sources of financing.

PLAN OF DISTRIBUTION

In General

Our company is offering a maximum of 3,750,000,000 Offered Shares on a best-efforts basis, at a fixed price of $____[$0.015-$0.05] per Offered Share; any funds derived from this offering will be immediately available to us for our use. There will be no refunds. This offering will terminate at the earliest of (a) the date on which the maximum offering has been sold, (b) the date which is one year from this offering being qualified by the SEC or (c) the date on which this offering is earlier terminated by us, in our sole discretion.

There is no minimum number of Offered Shares that we are required to sell in this offering. All funds derived by us from this offering will be immediately available for use by us, in accordance with the uses set forth in the Use of Proceeds section of this Offering Circular. No funds will be placed in an escrow account during the offering period and no funds will be returned, once an investor’s subscription agreement has been accepted by us.

We intend to sell the Offered Shares in this offering through the efforts of our President, Henry D. Fahman. Mr. Fahman will not receive any compensation for offering or selling the Offered Shares. We believe that Mr. Fahman is exempt from registration as a broker-dealer under the provisions of Rule 3a4-1 promulgated under the Securities Exchange Act of 1934 (the Exchange Act). In particular, Mr. Fahman:

● primarily performs, and will perform at the end of this offering, substantial duties for us or on our behalf otherwise than in connection with transactions in securities; and

● was not a broker or dealer, or an associated person of a broker or dealer, within the preceding 12 months; and

● did not participate in selling an offering of securities for any issuer more than once every 12 months other than in reliance on paragraphs (a)(4)(i) or (iii) of Rule 3a4-1 under the Exchange Act.

As of the date of this Offering Circular, we have not entered into any agreements with selling agents for the sale of the Offered Shares. However, we reserve the right to engage FINRA-member broker-dealers. In the event we engage FINRA-member broker-dealers, we expect to pay sales commissions of up to 8.0% of the gross offering proceeds from their sales of the Offered Shares. In connection with our appointment of a selling broker-dealer, we intend to enter into a standard selling agent agreement with the broker-dealer pursuant to which the broker-dealer would act as our non-exclusive sales agent in consideration of our payment of commissions of up to 8% on the sale of Offered Shares effected by the broker-dealer.

Procedures for Subscribing

If you are interested in subscribing for Offered Shares in this offering, please go to www.phiglobal.com and electronically receive and review the information set forth on such website.

Thereafter, should you decide to subscribe for Offered Shares, you are required to follow the procedures described therein, which are:

Right to Reject Subscriptions

After we receive your complete, executed subscription agreement and the funds required under the subscription agreement have been transferred to us, we have the right to review and accept or reject your subscription in whole or in part, for any reason or for no reason. We will return all monies from rejected subscriptions immediately to you, without interest or deduction.

Acceptance of Subscriptions

Upon our acceptance of a subscription agreement, we will countersign the subscription agreement and issue the Offered Shares subscribed. Once you submit the subscription agreement and it is accepted, you may not revoke or change your subscription or request your subscription funds. All accepted subscription agreements are irrevocable.

This Offering Circular will be furnished to prospective investors upon their request via electronic PDF format and will be available for viewing and download on our website at www.phiglobal.com, as well as on the SEC’s website, www.sec.gov.

An investor will become a shareholder of our company and the Offered Shares will be issued, as of the date of settlement. Settlement will not occur until an investor’s funds have cleared and we accept the investor as a shareholder.

By executing the subscription agreement and paying the total purchase price for the Offered Shares subscribed, each investor agrees to accept the terms of the subscription agreement and attests that the investor meets certain minimum financial standards. (See “State Qualification and Investor Suitability Standards” below).

An approved trustee must process and forward to us subscriptions made through IRAs, Keogh plans and 401(k) plans. In the case of investments through IRAs, Keogh plans and 401(k) plans, we will send the confirmation and notice of our acceptance to the trustee.

Minimum Purchase Requirements

You must initially purchase at least $1,000 of the Offered Shares in this offering. If you have satisfied the minimum purchase requirement, any additional purchase must be in an amount of at least $250.

State Law Exemption and Offerings to “Qualified Purchasers”

The Offered Shares are being offered and sold only to “qualified purchasers” (as defined in Regulation A under the Securities Act). As a Tier 2 offering pursuant to Regulation A under the Securities Act, this offering will be exempt from state “Blue Sky” law review, subject to certain state filing requirements and anti-fraud provisions, to the extent that the Offered Shares offered hereby are offered and sold only to “qualified purchasers”. “Qualified purchasers” include: (a) “accredited investors” under Rule 501(a) of Regulation D and (b) all other investors, so long as their investment in Offered Shares does not represent more than 10% of the greater of their annual income or net worth (for natural persons), or 10% of the greater of annual revenue or net assets at fiscal year-end (for non-natural persons). Accordingly, we reserve the right to reject any investor’s subscription in whole or in part for any reason, including if we determine, in our sole and absolute discretion, that such investor is not a “qualified purchaser” for purposes of Regulation A. We intend to offer and sell the Offered Shares to qualified purchasers in every state of the United States.

Issuance of Offered Shares

Upon settlement, that is, at such time as an investor’s funds have cleared and we have accepted an investor’s subscription agreement, we will either issue such investor’s purchased Offered Shares in book-entry form or issue a certificate or certificates representing such investor’s purchased Offered Shares.

Transferability of the Offered Shares

The Offered Shares will be generally freely transferable, subject to any restrictions imposed by applicable securities laws or regulations.

Advertising, Sales and Other Promotional Materials

In addition to this Offering Circular, subject to limitations imposed by applicable securities laws, we expect to use additional advertising, sales and other promotional materials in connection with this offering. These materials may include information relating to this offering, articles and publications concerning industries relevant to our business operations or public advertisements and audio-visual materials, in each case only as authorized by us. In addition, the sales material may contain certain quotes from various publications without obtaining the consent of the author or the publication for use of the quoted material in the sales material. Although these materials will not contain information in conflict with the information provided by this Offering Circular and will be prepared with a view to presenting a balanced discussion of risk and reward with respect to the Offered Shares, these materials will not give a complete understanding of our company, this offering or the Offered Shares and are not to be considered part of this Offering Circular. This offering is made only by means of this Offering Circular and prospective investors must read and rely on the information provided in this Offering Circular in connection with their decision to invest in the Offered Shares.

DESCRIPTION OF SECURITIES

General

Our authorized capital stock consists of (a) 60,000,000,000 shares of common stock, $.001 par value per share; and (b) 500,000,000 shares of preferred stock, $.001 par value per share, of which 500,000,000 shares have been designated, as follows: (1) Class A Series I Preferred Stock, 50,000,000 shares authorized; (2) Class A Series II Preferred Stock, 200,000,000 shares authorized; (3) Class A Series III Preferred Stock, 50,000,000 shares authorized; (4) Class A Series IV Preferred Stock, 199,000,000 shares authorized; and (5) Class B Series I Preferred Stock, 1,000,000 shares authorized.

As of the date of this Offering Circular, there were (s) 28,774,498,378 shares of our common stock issued and outstanding, held by 53 holders of record; (t) no shares of Series A Class I Preferred Stock issued and outstanding; (u) no shares of Series A Class II Preferred Stock issued and outstanding, held by ____ holders of record; (v) no shares of Series A Class III Preferred Stock issued and outstanding; (x) no shares of Series A Class IV Preferred Stock issued and outstanding; and (z) 600,000 shares of Series B Class I Preferred Stock issued and outstanding, held by four holders of record.

Common Stock

In General. The holders of our common stock currently have (a) equal ratable rights to dividends from funds legally available therefor, when, as and if declared by our Board of Directors; (b) are entitled to share ratably in all of our assets available for distribution to holders of common stock upon liquidation, dissolution or winding up of the affairs of our company; (c) do not have preemptive, subscriptive or conversion rights and there are no redemption or sinking fund provisions or rights applicable thereto; and (d) are entitled to one non-cumulative vote per share on all matters on which shareholders may vote. Our bylaws provide that, at all meetings of the shareholders for the election of directors, a plurality of the votes cast shall be sufficient to elect. On all other matters, except as otherwise required by Wyoming law or our Articles of Incorporation, as amended, a majority of the votes cast at a meeting of the shareholders shall be necessary to authorize any corporate action to be taken by vote of the shareholders.

Non-cumulative Voting. Holders of shares of our common stock do not have cumulative voting rights, which means that the holders of more than 50% of the outstanding shares, voting for the election of directors, can elect all of the directors to be elected, if they so choose, and, in such event, the holders of the remaining shares will not be able to elect any of our directors. As of the date of this Offering Circular, our officers and directors own, directly or indirectly, a total of 427,884,136 shares, less than one-and-one-half percent of our outstanding common stock, which ownership percentage would remain below one percent, assuming all of the Offered Shares are sold in this offering. (See “Security Ownership of Certain Beneficial Owners and Management”).

Pre-emptive Rights. As of the date of this Offering Circular, no holder of any shares of our common stock has pre-emptive or preferential rights to acquire or subscribe for any unissued shares of any class of our capital stock not disclosed herein.

Preferred Stock

Class A Preferred Stock.

Designations, Amounts and Dividends.

Conversion.

Conversion Shares. The amount of shares of our company’s common stock, or alternatively, that of a subsidiary of our company, to be received by the then-holder at the time of conversion of Class A Series I or Class A Series II will be based on the following formula:

Redemption Rights. Our company, after a period of two years from the date of issuance, may, at any time or from time to time, redeem any series of Class A Preferred Stock, in whole or in part, at the option of our company’s Board of Directors, at a price equal to 120% of the original purchase price of the Class A Preferred Stock or of a unit consisting of any shares of Class A Preferred Stock and any warrants attached thereto, plus, in each case, accumulated and unpaid dividends to the date fixed for redemption.

Liquidation. Upon the occurrence of a Liquidation Event (defined below), the holders of Class A Preferred Stock are entitled to receive net assets on a pro rata basis. “Liquidation Event” means (a) the liquidation, dissolution or winding-up, whether voluntary or involuntary, of our company, (b) the purchase or redemption by us of shares of any class of stock or the merger or consolidation of our company with or into any other corporation or corporations, unless (1) the holders of the Class A Preferred Stock receive securities of the surviving corporation having substantially similar rights as the Class A Preferred Stock and the shareholders of our company immediately prior to such transaction are holders of at least a majority of the voting securities of the successor corporation immediately thereafter (the “Permitted Merger”), unless the holders of the shares of Class A Preferred Stock elect otherwise, or (2) the sale, license or lease of all or substantially all, or any material part of, our company’s assets, unless the holders of Class A Preferred Stock elect otherwise.

Rank. All shares of the Class A Preferred Stock shall rank (a) senior to our common stock and any other class or series of our capital stock hereafter created, (b) pari passu with any class or series of our capital stock hereafter created and specifically ranking, by its terms, on par with the Class A Preferred Stock, and (c) junior to any class or series of our capital stock hereafter created specifically ranking, by its terms, senior to the Class A Preferred Stock, in each case as to distribution of assets upon liquidation, dissolution or winding up of our company, whether voluntary or involuntary.

Voting Rights. Shares of Class A Series I, Class A Series II, Class A Series III and Class A Series IV Preferred Stock possess no voting rights.

Protection Provisions. So long as any shares of Class A Preferred Stock are outstanding, our company shall not, without first obtaining the majority written consent of the holders of Class A Preferred Stock, alter or change the rights, preferences or privileges of the Class A Preferred Stock so as to affect adversely the holders of Class A Preferred Stock.

Miscellaneous.

Status of Redeemed Stock. In case any shares of Class A Preferred Stock shall be redeemed or otherwise repurchased or reacquired, the shares so redeemed, repurchased or reacquired shall resume the status of authorized but unissued shares of preferred stock, and shall no longer be designated as Class A Preferred Stock.

Lost or Stolen Certificates. Upon receipt by us of (a) evidence of the loss, theft, destruction or mutilation of any preferred stock certificate(s) and (b) in the case of loss, theft or destruction, indemnity (with a bond or other security) reasonably satisfactory to us, or in the case of mutilation, the preferred stock certificate(s) (surrendered for cancellation), our company shall execute and deliver new preferred stock certificates. However, our company shall not be obligated to reissue such lost, stolen, destroyed or mutilated preferred stock certificates, if the holder of Class A Preferred Stock contemporaneously requests our company to convert such holder’s Class A Preferred Stock into shares of our common stock.

Waiver. Any provision relating to any right of the holders of Class A Preferred Stock may be waived as to all shares of Class A Preferred Stock (and the holders thereof), upon the majority written consent of the holders of the Class A Preferred Stock.

Class B Preferred Stock.

Designation, Amounts and Dividends.

Voting Rights. Except as provided by law, the shares of Class B Series I shall have the same right to vote or act on all matters on which the holders of our common stock have the right to vote or act, and the holders of the shares of Class B Series I shall be entitled to notice of any shareholders’ meeting or action as to such matters on the same basis as the holders of our common stock, and the holders of our common stock and shares of Class B Series I shall vote together or act together thereon as if a single class on all such matters; provided, in such voting or action each one share of Class B Series I shall be entitled to 100,000 votes.

Convertible Promissory Notes

As of December, 2021, we had outstanding a total of eight separate convertible promissory notes. The table below sets forth information with respect to such convertible promissory notes.

Dividend Policy

We have never declared or paid any dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.

Shareholder Meetings

Our bylaws provide that special meetings of shareholders may be called only by our Board of Directors, the chairman of the board or our president, or as otherwise provided under Wyoming law.

Transfer Agent

We have retained the services of Worldwide Stock Transfer, LLC, 1 University Plaza, Suite 505, Hackensack, New Jersey 07601, as the transfer agent for our common stock. Worldwide Stock Transfer’s website is located at: www.wwstr.com. No information found on Worldwide Stock Transfer’s website is part of this Offering Circular.

BUSINESS

Introduction

Currently, our company, PHI Group, Inc., is focused the development on PHILUX Global Funds, SCA, SICAV-RAIF, by launching a number of sub-funds for investment in real estate, renewable energy, infrastructure, agriculture and healthcare and on developing and establishing the Asia Diamond Exchange in Vietnam. In addition, PHILUX Capital Advisors, Inc. (formerly Capital Holdings, Inc.), a wholly owned subsidiary of our company, continues to provide corporate and project finance services, including merger and acquisition advisory and consulting services for U.S. and international companies. Recently, we signed agreements to acquire 70% ownership in Five-Grain Treasure Spirits Company, Ltd., a baiju distiller located in Jilin Province, China and 50.10% ownership in Kota Energy Group LLC and Kota Contruction LLC, both of which are California limited liability companies. No assurances can be made that we will be successful in achieving our plans, in this regard.

Our Company

Originally incorporated on June 8, 1982, as JR Consulting, Inc., a Nevada corporation, our company applied for a Certificate of Domestication and filed Articles of Domestication to become a Wyoming corporation on September 20, 2017.

From inception, our company was foremost engaged in mergers and acquisitions and had an operating subsidiary, Diva Entertainment, Inc., which operated two modeling agencies, one in New York and one in California. In January 2000, we changed our corporate name to Providential Securities, Inc. (while a Nevada corporation), following a business combination with Providential Securities, Inc., a California-based financial services company. In February 2000, we then changed our corporate name to Providential Holdings, Inc. (while a Nevada corporation). In October 2000, our company withdrew our securities brokerage membership and ceased our financial services business.

From October 2000 to October 2011, the Company and its subsidiaries were engaged in mergers and acquisitions advisory and consulting services, real estate and hospitality development, mining, oil and gas, telecommunications, technology, healthcare, private equity, and special situations. In April 2009, we changed our corporate name to PHI Group, Inc. (while a Nevada corporation).

In October 2011, we discontinued the operations of Providential Vietnam Ltd., Philand Ranch Limited, a United Kingdom corporation (together with its subsidiaries Philand Ranch - Singapore, Philand Corporation - US, and Philand Vietnam Ltd. - Vietnam), PHI Gold Corporation (formerly PHI Mining Corporation, a Nevada corporation), and PHI Energy Corporation (a Nevada corporation), and mainly focused on acquisition and development opportunities in energy and natural resource businesses.

Figure 1 below depicts the corporate structure of our company.

Figure 1

Business Strategy

In operating our business, we employ the following strategy:

Business

Development of the Asia Diamond Exchange in Vietnam. Along with the establishment of PHILUX Global Funds, since March 2018, our company has worked closely with the Authority of Chu Lai Open Economic Zone and the Provincial Government of Quang Nam, Vietnam to develop the Asia Diamond Exchange. Quang Nam Provincial Government has agreed to allocate more than 200 hectares in the sanctioned Free-Trade Zone near Chu Lai Airport, Nui Thanh District, Quang Nam Province in Central Vietnam for us to set up a multi-commodities center which would include the Asia Diamond Exchange.

Recently, another opportunity has arisen with the start of construction of the new international airport in Long Thanh District, Dong Nai Province near Ho Chi Minh City in Southern Vietnam. In December 2020, the Vietnamese central government designated 1,200 hectares of land in Bau Can village, Long Thanh District, Dong Nai Province as a new industrial zone. We are in the process of applying for 600 hectares close to the Long Thanh International Airport to develop Long Thanh Multi-Commodities Logistics Center (LMLC) with a plan to house the proposed International Financial Center, an Urban Area and other hi-tech industrial operations. On June 4, 2021, we incorporated Asia Diamond Exchange, Inc., a Wyoming corporation, ID number 2021-001010234, as the holding company for the Asia Diamond Exchange to be established in Vietnam.

Empire Spirits, Inc. Empire Spirits, Inc. is to serve as the holding company for the acquisition of 70% ownership in Five-Grain Treasure Spirits Company, Ltd. (“Five Grain”), a baiju distiller in Jilin Province, China. Our company, through Empire Spirits, Inc., will provide additional required capital for Five-Grain to execute fully its business plan. The budget for this transaction will be $100 million, to be paid in three tranches. We are in the process of completing our due diligence with respect Five-Grain and expect to sign definitive acquisition agreement in the near future. We have signed a definitive agreement to acquire 70% ownership in Five Grain and plan to close this transaction as soon as practical. We expect to use part of the proceeds from this offering to pay for this acquisition.

Baijiu is a white spirit distilled from sorghum. It is similar to vodka, but with a fragrant aroma and taste. It is currently the most consumed spirit in the world. Mainly consumed in China, it is gaining popularity in the rest of the world.

Five-Grain specializes in the production and sales of spirits and the development of proprietary spirit production processes. It also possesses a patented technology to grow red sorghum for baiju manufacturing. The patented grain produces superior yield and quality. Five-Grain is a reputable bulk alcohol supplier to some of the largest spirits companies in the world.

PHILUX Global Funds, SCA, SICAV-RAIF. On June 11, 2020, we received the approval from the Luxembourg Commission de Surveillance du Secteur Financier (CSSF) and successfully established and activated PHILUX GLOBAL FUNDS SCA, SICAV-RAIF (the “Fund”), Registration No. B244952, a Luxembourg bank fund organized as a Reserved Alternative Investment Fund in accordance with the Luxembourg Law of July 23, 2016 relative to reserved alternative investment funds, Law of August 23, 2016 relative to commercial companies, and Modified Law of July 12, 2013, relative to alternative investment fund managers.

The following entities have been engaged to support the Fund’s operations: (a) Custodian Bank: Hauck & Aufhauser Privatbankiers AG, (b) Administrative Registrar & Transfer Agent: Hauck & Aufhauser Alternative Investment Services S.A., (c) Fund Manager: Hauck & Aufhauser Fund Services S.A., (d) Fund Attorneys: DLP Law Firm SARL and VCI Legal, (e) Investment Advisor: PHILUX Capital Advisors, Inc., (f) Fund Auditors: E&Y Luxembourg and E&Y Vietnam, (g) Fund Tax Advisor: ATOZ Tax Management, Luxembourg, (h) Fund Independent Asset Valuator: Cushman & Wakefield, Vietnam.

The Fund is an umbrella fund containing one or more sub-fund compartments intended to invest in real estate, infrastructure, renewable energy, agriculture, healthcare and especially the Multi-Commodities Center (MCC) in Vietnam which will include the Asia Diamond Exchange and potentially the proposed International Financial Center.

PHILUX Capital Advisors, Inc. PHILUX Capital Advisors, Inc. was originally incorporated under the name of “Providential Capital, Inc.” in 2004 as a Nevada corporation and wholly-owned subsidiary of our company to provide merger and acquisition advisory services, consulting services, project financing, and capital market services to clients in North America and Asia. In May 2010, Providential Capital, Inc. changed its name to PHI Capital Holdings, Inc. It was re-domiciled as a Wyoming corporation on September 20, 2017, and changed its name to “PHILUX Capital Advisors, Inc.” on June 3, 2020. This subsidiary has successfully managed merger plans for several privately held and publicly traded companies and continues to focus on serving the Pacific Rim markets in the foreseeable future. This subsidiary currently serves as the investment advisor to PHILUX Global Funds SCA, SICAV-RAIF and also arranges debt financing for its international clients.

CO2-1-0 (Carbon) Corp. In August 2021, our company signed a letter of intent with Indonesia-based CYFS Group, headed by Mr. Choky Fernando Simanjuntak, to sponsor and co-found CO2-1-0 (Carbon) Corp., to implement a new disruptive carbon mitigation initiative through environmentally sustainable projects starting in Indonesia, Vietnam, other ASEAN countries and worldwide. On September 21, 2021, CO2-1-0 (Carbon) Corp. was incorporated as a Wyoming corporation to manage this program. Our company will contribute a major portion of the development budget and will hold 50.1% shares of the company. There is no assurance that we will ever possess sufficient capital to apply to this subsidiary’s development budget.

According to the United Nation Framework Convention on Climate Change (UNFCCC), together with the Paris agreement and Kyoto protocol in 2016, where Indonesia has actively participated and agreed to maintain the earth temperature not to exceed by 1.5 degrees Celsius by 2030, greenhouse gases (GHG), mainly CO2, CH4, N2O, SF6, HFCs, PFCs, are the root cause of global climate change, each of which can be calculated as CER (CO2 Emission Reduction) equivalent. The target for Indonesia is 834 million tonnes annually of CER by 2030.

Currently, CER is being tediously registered, validated and certified centrally under UNFCCC methodology by a few independent institutions, mostly in the US and Europe, where the CER later can be traded (as carbon credits) voluntarily. For the past 5 years, the market for carbon credits is nearly zero, and due to complexity of the processes, many companies and stand-alone projects have less appetite to be engaged into the carbon credit opportunity. Many environmentally sustainable projects (renewable energy, waste, agriculture , forestry, etc.) have failed to get financial support, especially at the development stage, due to the above reasons, causing less economic value of the project or delays.

Though the carbon market remains dormant, CER value is estimated to rise to US$100/ton CER by 2030, while cryptocurrency is just starting and has attracted many millennials and gen-Z who are more aware to green environment and sustainability (recent survey result, Indonesian college students, 12-13 July 2021). It is believed that, from year 2022 onward, the world will witness the boom of renewable energy projects and other sustainability initiatives that are related to carbon credits, with an enormous market size of 23 Giga tones of CO2 emission to be reduced in 2030. The Taskforce on Scaling Voluntary Carbon Markets (TSVCM), sponsored by the Institute of International Finance (IIF) with knowledge support from McKinsey, estimates that demand for carbon credits could increase by a factor of 15 or more by 2030 and by a factor of up to 100 by 2050. Overall, the market for carbon credits could be worth upward of $50 billion in 2030. However, we can offer no assurance that this will be the case.

CO2-1-0 (Carbon) aims to provide a solution in disruptive decentralized new carbon market system using blockchain technology, which will be empowering environmentally sustainable projects (renewable energy, waste, agriculture, forestry, etc.) starting in Indonesia, Vietnam, other ASEAN countries and worldwide. It has a clear and systematic product development roadmap and the ultimate milestones of the products estimated to be launched in the near future. The solution, methodology and improved TACCC (transparent, accurate, consistent, complete and comparable) business process originally introduced by CO2-1-0 (Carbon) are intended to bring full impact to better environment and life of millions.

American Pacific Resources, Inc. American Pacific Resources, Inc. (“APR”) is a Wyoming corporation established in April 2016 to serve as a holding company for various natural resource projects. On September 2, 2017, APR entered into an Agreement of Purchase and Sale with Rush Gold Royalty, Inc. (“RGR”), 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 cash, convertible demand promissory note and our Class A Series II Convertible Cumulative Redeemable Preferred Stock. This transaction was closed effective October 3, 2017. Following the first amendment dated April 19, 2018, and the second amendment dated September 29, 2018, retroactively effective April 20, 2018, to the afore-mentioned Agreement of Purchase and Sale, our company paid ten million shares of our Class A Series II Convertible Cumulative Redeemable Preferred Stock, a convertible demand promissory note and cash totaling $25,000,000 to Rush Gold Royalty, Inc. As of June 30, 2020, we have recorded $462,000 paid for this transaction as expenses for research and development in connection with the Granite Mining Claims project. The value of these mining claims is expected to be adjusted later, after a new valuation of these mining assets is conducted by an independent third-party valuator.

Special Stock Dividend. On April 23, 2018, our Board of Directors passed a resolution to declare a twenty percent (20%) special stock dividend from our holdings of common stock in American Pacific Resources, Inc., a subsidiary of our company, to our shareholders, 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 our common stock 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 our common stock held by such shareholders, as of the Record date. The payment date was rescheduled for March 29, 2019.

Most recently, on December 27, 2021, our Board of Directors adopted a resolution to further extend the Record Date to June 30, 2022, and state the provisions for the afore-mentioned stock dividend, as follows: (a) Eligible Shareholders: In order to be eligible for the above-mentioned special stock dividend, the minimum amount of our common stock each shareholder must hold as of June 30, 2022 (the “New Record Date”), is two thousand (2,000) shares; (b) Dividend Ratio: all eligible shareholders of our common stock as of the New Record Date will be entitled to receive one (1) share of common stock of American Pacific Resources, Inc. for every two thousand (2,000) shares of our common stock held by such shareholders as of the New Record Date; and (c) Payment Date: the Payment Date for the distribution of the special stock dividend to be ten (10) business days after a registration statement for said special stock dividend shares is declared effective by the SEC.

PHIVITAE Healthcare, Inc. PHIVITAE Healthcare, Inc., a Wyoming corporation, is a wholly-owned subsidiary of our company, established on July 07, 2017 under the name of “PHIVATAE Corporation, Inc.” with the intention to acquire a pharmaceutical and medical equipment distribution company in Romania and to manage distribution of medical equipment and pharmaceutical products to emerging markets. This subsidiary changed its name to PHIVITAE HEALTHCARE, INC. on March 17, 2020. On April 27, 2020, PHI Group, Inc. signed a business cooperation agreement with Natural Well Technical Ltd. (“NWTL”), Taiwanese company, to jointly cooperate in the research and development activities of pertinent technologies that have been initiated and continue to be carried out by NWTL and applying them to produce commercial products and services in the fields of healthcare, beauty supply, agriculture and industry, as the case may be, as well as any other business activities deemed mutually beneficial. PHIVITAE is also in the process of entering into a strategic alliance with a Vietnam-based medical supply company.

PHILUX Global Energy, Inc. On January 3, 2022, the Company incorporated “PHILUX Global Energy, Inc., a Wyoming corporation, as a wholly-owned subsidiary of the Company to serve as the holding company for the contemplated acquisition of 50.10% equity interests in Kota Energy Group, LLC and Kota Energy Construction, LLC, both of which are California limited liability companies engaged in solar the energy business.

Vinafilms International, Inc. On December 21, 2021, American Pacific Plastics, Inc., a Wyoming corporation and subsidiary of the Company, changed its name to Vinafilms International to engage in the production and distribution of plastic bags for the food and beverage industry.

Ownership Stakes in Other Companies

Myson Group, Inc. As of June 30, 2020, our company and one of our subsidiaries, PHI Capital Holdings, Inc., together owned 33,805,106 shares of common stock of Myson Group, Inc., a Nevada corporation currently traded on the OTC Markets under the symbol “MYSN.” We wrote off 32,900,106 shares of MYSN stock held in certificate form as worthless as of June 30, 2019, as Myson Group was not in good standing with the State of Nevada at that time. Subsequently, Myson Group filed a Certificate of Reinstatement with the Secretary of State of Nevada on June 4, 2021.

Sports Pouch Beverage Company, Inc. As of June 30, 2020, through PHILUX Capital Advisors, Inc., we owned 292,050,000 shares of Sports Pouch Beverage Company, Inc., a Nevada corporation traded on the OTC Markets under the symbol “SPBV”. On March 19, 2021, this company signed a Business Combination Agreement with Glink Apps International, Inc. and, effective October 16, 2021, the corporate name was changed to Glink Arts Global Group, Inc.

Intellectual Property

We regard our current and future trademarks, service marks and business know-how as having significant value. Our policy is to establish, enforce and protect our intellectual property rights using the intellectual property laws, as necessary.

Employees

Besides our current executive officers, we have six full-time and four part-time employees. Upon our obtaining adequate funding, we expect that we would hire additional employees. We have used, and, in the future, expect to use, the services of certain outside consultants and advisors as needed on a consulting basis.

MANAGEMENTS DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Cautionary Statement

The following discussion and analysis should be read in conjunction with our financial statements and related notes, beginning on page F-1 of this Offering Circular.

Our actual results may differ materially from those anticipated in the following discussion, as a result of a variety of risks and uncertainties, including those described under Cautionary Statement Regarding Forward-Looking Statements and Risk Factors. We assume no obligation to update any of the forward-looking statements included herein.

Implications of Being an Emerging Growth Company

As a company with less than $1.07 billion in revenue during our last fiscal year, we qualify as an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act). As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies. These provisions include:

We may take advantage of these exemptions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1.07 billion in annual revenue, we have more than $700 million in market value of our stock held by non-affiliates, or we issue more than $1 billion of non-convertible debt over a three-year period. We may choose to take advantage of some but not all of these reduced burdens. We have taken advantage of these reduced reporting burdens herein, and the information that we provide may be different than what you might get from other public companies in which you hold stock.

Critical Accounting Policies

In General. Our financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (GAAP). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenue and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures, including information regarding contingencies, risk and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. Valuations based on estimates are reviewed by us for reasonableness and conservatism on a consistent basis throughout our company. Primary areas where our company’s financial information is subject to the use of estimates, assumptions and the application of judgment include acquisitions, valuation of long-lived and intangible assets, recoverability of deferred tax and the valuation of shares issued for services. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions.

Valuation of Long-Lived and Intangible Assets. The recoverability of long-lived assets requires considerable judgment and is evaluated on an annual basis or more frequently if events or circumstances indicate that the assets may be impaired. As it relates to definite life intangible assets, we apply the impairment rules as required by SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and Assets to Be Disposed Of as amended by SFAS No. 144, which also requires significant judgment and assumptions related to the expected future cash flows attributable to the intangible asset. The impact of modifying any of these assumptions can have a significant impact on the estimate of fair value and, thus, the recoverability of the asset.

Income Taxes. We recognize deferred tax assets and liabilities based on the differences between the financial statement carrying amounts and the tax bases of assets and liabilities. We regularly review our deferred tax assets for recoverability and establish a valuation allowance based upon historical losses, projected future taxable income and the expected timing of the reversals of existing temporary differences. As of September 30, 2021, we estimated the allowance on net deferred tax assets to be one hundred percent of the net deferred tax assets.

Introduction

Our company is currently focused on PHILUX Global Funds, SCA, SICAV-RAIF by launching a number of sub-funds for investment in real estate, renewable energy, infrastructure, agriculture and healthcare and on developing and establishing the Asia Diamond Exchange in Vietnam. In addition, our wholly-owned subsidiary, PHILUX Capital Advisors, Inc. (formerly Capital Holdings, Inc.), continues to provide corporate and project finance services, including merger and acquisition advisory and consulting services for U.S. and international companies. No assurances can be made that we will be successful in achieving our objectives.

Business Strategy

Our overarching strategy to achieve growth in our operations is to:

Subsidiaries

Development of the Asia Diamond Exchange in Vietnam. Along with the establishment of PHILUX Global Funds, since March 2018, our company has worked closely with the Authority of Chu Lai Open Economic Zone and the Provincial Government of Quang Nam, Vietnam to develop the Asia Diamond Exchange. Quang Nam Provincial Government has agreed to allocate more than 200 hectares in the sanctioned Free-Trade Zone near Chu Lai Airport, Nui Thanh District, Quang Nam Province in Central Vietnam for us to set up a multi-commodities center which would include the Asia Diamond Exchange.

Recently, another opportunity has arisen with the start of construction of the new international airport in Long Thanh District, Dong Nai Province near Ho Chi Minh City in Southern Vietnam. In December 2020, the Vietnamese central government designated 1,200 hectares of land in Bau Can village, Long Thanh District, Dong Nai Province as a new industrial zone. We are in the process of applying for 600 hectares close to the Long Thanh International Airport to develop Long Thanh Multi-Commodities Logistics Center (LMLC) with a plan to house the proposed International Financial Center, an Urban Area and other hi-tech industrial operations. On June 4, 2021, we incorporated Asia Diamond Exchange, Inc., a Wyoming corporation, ID number 2021-001010234, as the holding company for the Asia Diamond Exchange to be established in Vietnam.

Empire Spirits, Inc. Empire Spirits, Inc. is to serve as the holding company for the acquisition of 70% ownership in Five-Grain Treasure Spirits Company, Ltd. (“Five Grain”), a baiju distiller in Jilin Province, China. Our company, through Empire Spirits, Inc., will provide additional required capital for Five-Grain to execute fully its business plan. The budget for this transaction will be $100 million, to be paid in three tranches. We have signed a definitive agreement to acquire 70% ownership in Five Grain and plan to close this transaction as soon as practical. We expect to use part of the proceeds from this offering to pay for this acquisition.

Baijiu is a white spirit distilled from sorghum. It is similar to vodka, but with a fragrant aroma and taste. It is currently the most consumed spirit in the world. Mainly consumed in China, it is gaining popularity in the rest of the world.

Five-Grain specializes in the production and sales of spirits and the development of proprietary spirit production processes. It also possesses a patented technology to grow red sorghum for baiju manufacturing. The patented grain produces superior yield and quality. Five-Grain is a reputable bulk alcohol supplier to some of the largest spirits companies in the world.

PHILUX Global Funds, SCA, SICAV-RAIF. On June 11, 2020, we received the approval from the Luxembourg Commission de Surveillance du Secteur Financier (CSSF) and successfully established and activated PHILUX GLOBAL FUNDS SCA, SICAV-RAIF (the “Fund”), Registration No. B244952, a Luxembourg bank fund organized as a Reserved Alternative Investment Fund in accordance with the Luxembourg Law of July 23, 2016 relative to reserved alternative investment funds, Law of August 23, 2016 relative to commercial companies, and Modified Law of July 12, 2013, relative to alternative investment fund managers.

The following entities have been engaged to support the Fund’s operations: (a) Custodian Bank: Hauck & Aufhauser Privatbankiers AG, (b) Administrative Registrar & Transfer Agent: Hauck & Aufhauser Alternative Investment Services S.A., (c) Fund Manager: Hauck & Aufhauser Fund Services S.A., (d) Fund Attorneys: DLP Law Firm SARL and VCI Legal, (e) Investment Advisor: PHILUX Capital Advisors, Inc., (f) Fund Auditors: E&Y Luxembourg and E&Y Vietnam, (g) Fund Tax Advisor: ATOZ Tax Management, Luxembourg, (h) Fund Independent Asset Valuator: Cushman & Wakefield, Vietnam.

The Fund is an umbrella fund containing one or more sub-fund compartments intended to invest in real estate, infrastructure, renewable energy, agriculture, healthcare and especially the Multi-Commodities Center (MCC) in Vietnam which will include the Asia Diamond Exchange and potentially the proposed International Financial Center.

PHILUX Capital Advisors, Inc. PHILUX Capital Advisors, Inc. was originally incorporated under the name of “Providential Capital, Inc.” in 2004 as a Nevada corporation and wholly-owned subsidiary of our company to provide merger and acquisition advisory services, consulting services, project financing, and capital market services to clients in North America and Asia. In May 2010, Providential Capital, Inc. changed its name to PHI Capital Holdings, Inc. It was re-domiciled as a Wyoming corporation on September 20, 2017, and changed its name to “PHILUX Capital Advisors, Inc.” on June 3, 2020. This subsidiary has successfully managed merger plans for several privately held and publicly traded companies and continues to focus on serving the Pacific Rim markets in the foreseeable future. This subsidiary currently serves as the investment advisor to PHILUX Global Funds SCA, SICAV-RAIF and also arranges debt financing for its international clients.

CO2-1-0 (Carbon) Corp. In August 2021, our company signed a letter of intent with Indonesia-based CYFS Group, headed by Mr. Choky Fernando Simanjuntak, to sponsor and co-found CO2-1-0 (Carbon) Corp., to implement a new disruptive carbon mitigation initiative through environmentally sustainable projects starting in Indonesia, Vietnam, other ASEAN countries and worldwide. On September 21, 2021, CO2-1-0 (Carbon) Corp. was incorporated as a Wyoming corporation to manage this program. Our company will contribute a major portion of the development budget and will hold 50.1% shares of the company. There is no assurance that we will ever possess sufficient capital to apply to this subsidiary’s development budget.

According to the United Nation Framework Convention on Climate Change (UNFCCC), together with the Paris agreement and Kyoto protocol in 2016, where Indonesia has actively participated and agreed to maintain the earth temperature not to exceed by 1.5 degrees Celsius by 2030, greenhouse gases (GHG), mainly CO2, CH4, N2O, SF6, HFCs, PFCs, are the root cause of global climate change, each of which can be calculated as CER (CO2 Emission Reduction) equivalent. The target for Indonesia is 834 million tonnes annually of CER by 2030.

Currently, CER is being tediously registered, validated and certified centrally under UNFCCC methodology by a few independent institutions, mostly in the US and Europe, where the CER later can be traded (as carbon credits) voluntarily. For the past 5 years, the market for carbon credits is nearly zero, and due to complexity of the processes, many companies and stand-alone projects have less appetite to be engaged into the carbon credit opportunity. Many environmentally sustainable projects (renewable energy, waste, agriculture , forestry, etc.) have failed to get financial support, especially at the development stage, due to the above reasons, causing less economic value of the project or delays.

Though the carbon market remains dormant, CER value is estimated to rise to US$100/ton CER by 2030, while cryptocurrency is just starting and has attracted many millennials and gen-Z who are more aware to green environment and sustainability (recent survey result, Indonesian college students, 12-13 July 2021). It is believed that, from year 2022 onward, the world will witness the boom of renewable energy projects and other sustainability initiatives that are related to carbon credits, with an enormous market size of 23 Giga tones of CO2 emission to be reduced in 2030. The Taskforce on Scaling Voluntary Carbon Markets (TSVCM), sponsored by the Institute of International Finance (IIF) with knowledge support from McKinsey, estimates that demand for carbon credits could increase by a factor of 15 or more by 2030 and by a factor of up to 100 by 2050. Overall, the market for carbon credits could be worth upward of $50 billion in 2030. However, we can offer no assurance that this will be the case.

CO2-1-0 (Carbon) aims to provide a solution in disruptive decentralized new carbon market system using blockchain technology, which will be empowering environmentally sustainable projects (renewable energy, waste, agriculture, forestry, etc.) starting in Indonesia, Vietnam, other ASEAN countries and worldwide. It has a clear and systematic product development roadmap and the ultimate milestones of the products estimated to be launched in the near future. The solution, methodology and improved TACCC (transparent, accurate, consistent, complete and comparable) business process originally introduced by CO2-1-0 (Carbon) are intended to bring full impact to better environment and life of millions.

American Pacific Resources, Inc. American Pacific Resources, Inc. (“APR”) is a Wyoming corporation established in April 2016 to serve as a holding company for various natural resource projects. On September 2, 2017, APR entered into an Agreement of Purchase and Sale with Rush Gold Royalty, Inc. (“RGR”), 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 cash, convertible demand promissory note and our Class A Series II Convertible Cumulative Redeemable Preferred Stock. This transaction was closed effective October 3, 2017. Following the first amendment dated April 19, 2018, and the second amendment dated September 29, 2018, retroactively effective April 20, 2018, to the afore-mentioned Agreement of Purchase and Sale, our company paid ten million shares of our Class A Series II Convertible Cumulative Redeemable Preferred Stock, a convertible demand promissory note and cash totaling $25,000,000 to Rush Gold Royalty, Inc. As of June 30, 2020, we have recorded $462,000 paid for this transaction as expenses for research and development in connection with the Granite Mining Claims project. The value of these mining claims is expected to be adjusted later, after a new valuation of these mining assets is conducted by an independent third-party valuator.

Special Stock Dividend. On April 23, 2018, our Board of Directors passed a resolution to declare a twenty percent (20%) special stock dividend from our holdings of common stock in American Pacific Resources, Inc., a subsidiary of our company, to our shareholders, 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 our common stock 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 our common stock held by such shareholders, as of the Record date. The payment date was rescheduled for March 29, 2019.

Most recently, on December 27, 2021, our Board of Directors adopted a resolution to further extend the Record Date to June 30, 2022, and state the provisions for the afore-mentioned stock dividend, as follows: (a) Eligible Shareholders: In order to be eligible for the above-mentioned special stock dividend, the minimum amount of our common stock each shareholder must hold as of June 30, 2022 (the “New Record Date”), is two thousand (2,000) shares; (b) Dividend Ratio: all eligible shareholders of our common stock as of the New Record Date will be entitled to receive one (1) share of common stock of American Pacific Resources, Inc. for every two thousand (2,000) shares of our common stock held by such shareholders as of the New Record Date; and (c) Payment Date: the Payment Date for the distribution of the special stock dividend to be ten (10) business days after a registration statement for said special stock dividend shares is declared effective by the SEC.

PHIVITAE Healthcare, Inc. PHIVITAE Healthcare, Inc., a Wyoming corporation, is a wholly-owned subsidiary of our company, established on July 07, 2017 under the name of “PHIVATAE Corporation, Inc.” with the intention to acquire a pharmaceutical and medical equipment distribution company in Romania and to manage distribution of medical equipment and pharmaceutical products to emerging markets. This subsidiary changed its name to PHIVITAE HEALTHCARE, INC. on March 17, 2020. On April 27, 2020, PHI Group, Inc. signed a business cooperation agreement with Natural Well Technical Ltd. (“NWTL”), Taiwanese company, to jointly cooperate in the research and development activities of pertinent technologies that have been initiated and continue to be carried out by NWTL and applying them to produce commercial products and services in the fields of healthcare, beauty supply, agriculture and industry, as the case may be, as well as any other business activities deemed mutually beneficial. PHIVITAE is also in the process of entering into a strategic alliance with a Vietnam-based medical supply company.

PHILUX Global Energy, Inc. On January 3, 2022, the Company incorporated “PHILUX Global Energy, Inc., a Wyoming corporation, as a wholly-owned subsidiary of the Company to serve as the holding company for the contemplated acquisition of 50.10% equity interests in Kota Energy Group, LLC and Kota Energy Construction, LLC, both of which are California limited liability companies engaged in solar the energy business.

Vinafilms International, Inc. On December 21, 2021, American Pacific Plastics, Inc., a Wyoming corporation and subsidiary of the Company, changed its name to Vinafilms International to engage in the production and distribution of plastic bags for the food and beverage industry.

Ownership Stakes in Other Companies

Myson Group, Inc. As of June 30, 2020, our company and one of our subsidiaries, PHI Capital Holdings, Inc., together owned 33,805,106 shares of common stock of Myson Group, Inc., a Nevada corporation currently traded on the OTC Markets under the symbol “MYSN.” We wrote off 32,900,106 shares of MYSN stock held in certificate form as worthless as of June 30, 2019, as Myson Group was not in good standing with the State of Nevada at that time. Subsequently, Myson Group filed a Certificate of Reinstatement with the Secretary of State of Nevada on June 4, 2021.

Sports Pouch Beverage Company, Inc. As of June 30, 2020, through PHILUX Capital Advisors, Inc., we owned 292,050,000 shares of Sports Pouch Beverage Company, Inc., a Nevada corporation traded on the OTC Markets under the symbol “SPBV”. On March 19, 2021, this company signed a Business Combination Agreement with Glink Apps International, Inc. and, effective October 16, 2021, the corporate name was changed to Glink Arts Global Group, Inc.

Results of Operations

Three Months Ended September 30, 2021, compared to the Three Months Ended September 30, 2020.

Total Revenues. We are primarily focused on developing the Asia Diamond Exchange and launching PHILUX Global Funds and only generated $20,000 in revenues from consulting services for the three months ended September 30, 2021, as compared to $5,000 in revenues from consulting services for the three months ended September 30, 2020.

Total Operating Expenses. Our total operating expenses were $5,229,229 and $317,023 for the three months ended September 30, 2021 and 2020, respectively. The increase of $4,912,206 in total operating expenses between the two periods was mainly due to an increase of $4,950,065 in general and administrative expenses as a result of consulting services for the development of the ADE token in connection with the Asia Diamond Exchange.

Loss from Operations. We incurred a loss from operations for the three months ended September 30, 2021, of $5,960,170, as compared to our loss from operations of $336,264 for the three months ended September 30, 2020. The increase of $4,897,206 in the loss from operations between the two periods was mainly due to a decrease of $4,912,206 in general and administrative expenses as described above.

Other Income and Expenses. We incurred net other expenses of $750,941 for the three months ended September 30, 2021, as compared to net other expenses of $24,241 for the three months ended September 30, 2020. The increase in other expenses of $726,700 between the two periods was mainly due to a decrease of $947 in other income, an increase of $26,533 in interest expenses and an increase of $699,220 in other expense stemming primarily from loss on conversions of stock in the amount of $571,042, prepayment premium of $7,908, and origination costs of $118,245 associated with the new convertible notes for the three months ended September 30, 2021 and 2020, respectively.

Net Income (Loss). Our net loss for the three months ended September 30, 2021, was $5,960,170, as compared to a net loss of $336,264 for the three months ended September 30, 2020, which is equivalent to ($0.00) per share for the three months ended September 30, 2021 and 2020, respectively, based on the weighted average number of basic and diluted shares outstanding at the end of each period.

Years Ended June 30, 2021 and 2020.

Revenues. Our company earned $61,000 from consulting services for the fiscal year ended June 30, 2021, as compared to $12,531 earned from consulting services for the fiscal year ended June 30, 2020.

Operating Expenses. We incurred total operating expenses of $913,616 for the fiscal year ended June 30, 2021, as compared to $1,873,738 for the year ended June 30, 2020. The decrease of $960,122 includes a decrease of $91,308 in general and administrative expenses, a decrease of $816,314 in professional services and a decrease of $52,5000 in salaries and wages fees between the two fiscal periods. The decrease in professional services was due to a decrease in the expenses associated with setting up the Luxembourg bank funds during the fiscal year ended June 30, 2021.

Income (loss) from operations. We incurred a loss from operations of $852,616 for the fiscal year ended June 30, 2021, as compared to a loss from operations of $1,861,207 for the fiscal year ended June 30, 2020. This represents a decrease of $1,008,591 in loss from operations from the fiscal year ended June 30, 2021, to the fiscal year ended June 30, 2020. This was mainly due to a decrease of $91,308 in general and administrative expenses, a decrease of $816,314 in professional services, a decrease of $52,5000 in salaries and wages fees between the two fiscal periods as described above, plus an increase of $48,469 in revenues in the current period.

Other income (expense). We had net other expenses of $5,700,562 for the fiscal year ended June 30, 2021, as compared to net other income of $539,402 for the fiscal year ended June 30, 2020. The net variance of $6,239,964 between the two fiscal periods was primarily due to an increase of $69,638 in interest expenses, a decrease of $448,331 in other income and an increase in other expenses in the amount of $5,721,995. We recognized $302,420 as other income in connection with derecognition of liabilities associated with derivatives and accrued interest, a gain in settlement of debt in the amount of $87,228, a refund of $10,650 and total adjustments of $6,458 from the accounts of the Luxembourg bank funds, due to exchange rates during the fiscal year ended June 30, 2021, as compared to a total of 855,107 as other income from derivative gains during the fiscal year ended June 30, 2020. As for other expenses, we incurred $5,738,058 under this category during the fiscal year ended June 30, 2021, primarily due to loss on issuance of stock in the amount of $2,431,914, loss on conversion of notes in the amount of $2,558,325, loss on note discounts of $92,933, penalties of $174,987 and financing origination costs of $28,070, as compared to $16,063 in other expenses during the fiscal year ended June 30, 2021.

Net income (loss). We incurred a net loss of $6,553,178 for the fiscal ended June 30, 2021, as compared to a net loss of $1,321,805 for the fiscal year ended June 30, 2020, representing a variance of $5,231,373 in net loss between the two fiscal years. The net loss per share based on the basic and diluted weighted average number of common shares outstanding for both of the fiscal years ended June 30, 2021 and June 30, 2020, was $(0.00).

Cash Flows

Three Months Ended September 30, 2021, compared to the Three Months Ended September 30, 2020. Our company’s cash and cash equivalents balances were $108,388 and $299,735 as of March 31, 2021 and 2020, respectively.

Net cash used in our operating activities during the nine months ended March 31, 2021, was $1,174,247, as compared to net cash used in operating activities of $60,022 during the nine months ended March 31, 2020. This represents a variance of $1,114,225 in net cash used in operating activities between the two periods. The underlying reasons for the variance were primarily due to a decrease of $625,166 in loss from operations, provisions for development costs of the Asia Diamond Exchange in the amount of $265,373, a variance in other assets and prepaid expenses in the amount of $1,357,721, an increase in sub-fund obligations of $208,141, a reduction of accrued expenses in the amount of $114,973, an increase in advances from customers of $85,910 due to interest expenses, and net change in notes payable, derivatives and mark-to-market in the amount of $304,151 between the two periods.

There was no net cash provided by or used in investing activities during the nine months ended March 31, 2021 and 2020, respectively.

Cash provided by financing activities was $ 1,057,253 for the nine months ended March 31, 2021, as compared to cash provided by financing activities in the amount of $287,988 for the nine months ended March 31, 2020. The primary underlying reasons for an increase of $769,265 in cash provided by financing activities between the two corresponding periods were primarily due to an increase in common stock and paid-in capital in the amount $559,832, an increase of $98,941 from notes and loans, and a decrease in comprehensive loss of $110,552 between the two periods.

Year Ended June 30, 2021, compared to the Year Ended June 30, 2020. We had in cash and cash equivalents of $95,344 as of June 30, 2021, as compared to $225,381 in cash and cash equivalents as of June 30, 2020.

Net cash used in our operating activities was $79,446 for the fiscal year ended June 30, 2021, as compared to cash used in operating activities of $720,125 for the fiscal year ended June 30, 2020.

The underlying reasons for the variance in net cash provided by and used in operating activities between the two fiscal year periods were mainly due to an increase in net loss from operations of $5,231,373, a net increase of $6,507,913 due to conversion of notes, a net decrease in assets and prepaid expenses of $770,632 and a net decrease in accounts payable and accrued expenses of $39,617.

There was $441,995 in cash used in investing activities during the fiscal year ended June 30, 2021, as compared to no cash provided by or used in investing activities during the fiscal year ended June 30, 2020.

Net cash provided by financing activities was $391,404 for the fiscal year ended June 30, 2021, as compared with $873,827 for the fiscal year ended June 30, 2020. The net cash provided by financing activities for the fiscal year ended June 30, 2021, consist of $24,049 from loans from an officer, $254,825 from short-term notes and loans and $112,530 from issuance of common stock for cash.

Historical Financing Arrangements

Short Term Notes Payable and Issuance of Common Stock. In the course of our business, we have obtained short-term loans from individuals and institutional investors and from time to time raised money by issuing restricted common stock of our company. These notes bear interest rates ranging from 0% to 36% per annum.

Convertible Promissory Notes. As of December, 2021, we had outstanding a total of eight separate convertible promissory notes. The table below sets forth information with respect to such convertible promissory notes.

Plan of Operation

We believe that the proceeds of this offering will satisfy a portion of our cash requirements for at least the next twelve months.

In the next twelve months our company’s goals are to create a number of sub-funds under PHILUX Global Funds SCA, SICAV-RAIF for investment in real estate, renewable energy, agriculture, infrastructure, and healthcare, as well as develop the Asia Diamond Exchange in Vietnam. In addition, the Company will continue to carry out its merger and acquisition program by acquiring target companies for roll-up strategy and also invest in special situations. In particular, we intend to complete the acquisition of Five-Grain Treasure Spirits Co., Ltd., under Empire Spirits, Inc., and develop a private baiju brand to increase revenues. Moreover, we will continue to provide advisory and consulting services to international clients through oru wholly-owned subsidiary, PHILUX Capital Advisors, Inc. (formerly known as PHI Capital Holdings, Inc.).

Cash Requirements. We must obtain substantial amounts of capital in order to accomplish our plans for PHILUX Global Funds and for acquisitions. In addition to proceeds from this offering, we expect to use equity, debt and project financing to meet our capital needs for acquisitions and investments. There is, however, no assurance that we will be able to secure needed funding.

Equity Line Facility. On March 6, 2017, our company and Azure Capital (“Azure”) entered into an Investment Agreement and a Registration Rights Agreement. Pursuant to the Investment Agreement, Azure committed to purchase, subject to certain restrictions and conditions, up to $10,000,000 of our common stock, over a period of 36 months from the effective date of the registration statement registering the resale of shares purchased by Azure pursuant to the Investment Agreement..

We filed a Registration Statement on Form S-1 with the SEC to include shares of our common stock intended for issuance in connection with an investment agreement. This Registration Statement was declared effective by the SEC on January 11, 2018 (File No. 333-219769). We never accessed the equity line facility embodied in the investment agreement and, on January 14, 2022, we terminated this offering.

Off Balance Sheet Arrangements

As of September 30, 2021, and June 30, 2021, there were no off-balance sheet arrangements.

Contractual Obligations

To date, we have not entered into a long-term obligation.

Capital Expenditures

During the three months ended September 30, 2021, and the year ended June 30, 2021, we made no capital expenditures. Without obtaining additional capital, we will not be able to make any capital expenditures.

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

Directors and Executive Officers

The following table sets forth the names and ages of our company’s current directors and executive officers.

Our Directors serve until the earlier occurrence of the election of his successor at the next meeting of shareholders, death, resignation or removal by the Board of Directors. Officers serve at the discretion of our Board of Directors. Henry D. Fahman, our President, is the husband of Tina T. Phan, our Secretary and Treasurer. There exist no other family relationships between our officers and directors.

Certain information regarding the backgrounds of each of our officers and directors is set forth below.

Henry D. Fahman has more than 30 years experience in general management, finance, investments and corporate strategy. He has been President and Chairman of the Board of our company since January 2000, and is currently Acting Financial Officer of our company. Mr. Fahman served as President and Chairman of the Board of Providential Securities, Inc. from its inception in October 1992 to October 2000. He holds a B.S., magna cum laude, in business administration from the University of California at Berkeley, with emphasis in finance and economic analysis and policy, and is a graduate of the Advanced Management Program (AMP166) from Harvard Business School. He has also attended other Executive Education programs at Harvard Business School and Stanford University, including Mergers and Acquisitions, Creating Competitive Advantage, and Advanced General Management. Previously, he served as a Resettlement Coordinator for the United Nations High Commissioner for Refugees. Mr. Fahman also serves as Chairman/Managing Director of PHILUX Capital Advisors, Inc., a wholly owned subsidiary of our company, Chairman of PHILUX Global Funds SCA, SICAV-RAIF, and interim Chief Executive Officer of American Laser Healthcare Corporation, a Delaware corporation.

Tam T. Bui is our current Chief Operating Officer and has been a Director of our company since April 2009 and served as a Chief Technology Officer from May 2002 to April 2009. Mr. Bui holds Bachelor and Master of Science degrees from the University of Minnesota and has attended continuing Education at the University of California, Los Angeles. He has over 25 years of experience with Northrop Grumman, Honeywell, Inc. and TRW in various capacities such Project Director, Project Manager, Department Manager, Program Manager and Implementation Manager. One of Mr. Bui’s major responsibilities has been the construction of dual Emergency Command Control Communication (ECCC) centers and implementation of the Los Angeles Police Department ECCC Systems. He has a broad knowledge and experience in the areas of information technology, intranet/internet technology, inventory management, material resource planning, enterprise resource planning, human resource management, investment management, real estate, and international business. Mr. Bui also serves as Vice-Chairman of PHILUX Capital Advisors, Inc., a wholly-owned subsidiary of our company, and a member of the Board of Directors of PHILUX Global Funds, a Luxembourg bank fund.

Frank Hawkins has been a Director of our company since April 2009 and Mr. Hawkins is a founder and CEO of Hawk Associates with 30 years of award-winning investor relations experience, Mr. Hawkins has earned the wide respect of Wall Street’s investment community for straight talk and integrity. He was formerly vice president/corporate relations and planning and head of the investor relations program at Knight-Ridder, Inc. in Miami. Mr. Hawkins started his career as an agent handler in clandestine collection operations for the Defense Intelligence Agency in Germany and went on to become a foreign and war correspondent, international businessman, senior corporate executive and president of the Access Asia Group in Hong Kong. He has lived in eight countries. He has been involved in stock listings in Tokyo and Frankfurt and company presentations in London, Zurich, Geneva and Singapore. Fluent in German, he is a graduate of Cornell University and author of “Ritter’s Gold,” an adventure novel published in several languages by the New American Library. He is a member of the Association of Former Intelligence Officers and the Audubon Society and is listed in Who’s Who in America and Who’s Who in the World. He serves on the board of the Florida Keys Electric Cooperative.

Tina T. Phan has been Secretary and Treasurer of our company since April 2009. She served as a Director of our company from January 2000 to April 10, 2009, and was Vice President of Operations of Providential Securities, Inc. from 1995 to 2000. Mrs. Phan holds a B.S. in management information system from California State University, Los Angeles. Currently, Mrs. Phan serves a member of the Board of Directors of PHI Luxembourg Development S.A., the mother holding company of PHILUX Global Funds.

Conflicts of Interest

Certain of the officers and directors of our company are engaged in other businesses, either individually or through partnerships and corporations in which they have an interest, hold an office, or serve on a board of directors. As a result, certain conflicts of interest may arise between our company and our officers and directors. We will attempt to resolve such conflicts of interest in favor of our company. Our officers and directors are accountable to us and our shareholders as fiduciaries, which require that such officers and directors exercise good faith and integrity in handling our company’s affairs. A shareholder may be able to institute legal action on behalf of our company or on behalf of such shareholder and other similarly situated shareholders to recover damages or for other relief in cases of the resolution of conflicts is in any manner prejudicial to our company.

Corporate Governance

We do not have a separate Compensation Committee, Audit Committee or Nominating Committee. These functions are conducted by our Board of Directors acting as a whole. During the year ended June 30, 2021, our Board of Directors did not hold a meeting in person, but had telephonic and Zoom conference calls on four occasions and took action by written consent via email in lieu of a meeting on eight occasions.

Independence of Board of Directors

None of our directors is independent, within the meaning of definitions established by the SEC or any self-regulatory organization. We are not currently subject to any law, rule or regulation requiring that all or any portion of our Board of Directors include independent directors.

Shareholder Communications with Our Board of Directors

Our company welcomes comments and questions from our shareholders. Shareholders should direct all communications to our Secretary, Tina T. Phan, at our executive offices. However, while we appreciate all comments from shareholders, we may not be able to respond individually to all communications. We will attempt to address shareholder questions and concerns in our press releases and documents filed with the SEC, so that all shareholders have access to information about us at the same time. Ms. Phan collects and evaluates shareholder communications, except those addressed directly to our directors and executive officers. All communications addressed to our directors and executive officers will be reviewed by those parties, unless the communication is clearly frivolous.

Code of Ethics

As of the date of this Offering Circular, our Board of Directors has not adopted a code of ethics with respect to our directors, officers and employees.

EXECUTIVE COMPENSATION

In General

Currently, our management is unable to estimate accurately when, if ever, our company will possess sufficient capital, whether derived from sales revenues, this offering or otherwise, for the payment of salaries to our management.

As of the date of this Offering Circular, there are no annuity, pension or retirement benefits proposed to be paid to officers, directors or employees of our company, pursuant to any presently existing plan provided by, or contributed to, our company.

Compensation Summary

The following table summarizes information concerning the compensation awarded, paid to or earned by, our executive officers.

Outstanding Option Awards

The following table provides certain information regarding unexercised options to purchase common stock, stock options that have not vested and equity-incentive plan awards outstanding as of the date of this Offering Circular, for each named executive officer.

Employment Agreements

We entered into an employment agreement with Henry D. Fahman on April 15, 2009, to serve as our President and Chief Executive Officer. This employment agreement is automatically renewed after every third-year anniversary and may terminate either with a minimum of ninety-days’ advance notice by either party, or due to Mr. Fahman’s death, insanity, disability, for cause or any time by mutual agreement in writing. It is our intention to enter into employment agreements with other executive officers in the future.

Outstanding Equity Awards

Our Board of Directors has made no equity awards and no such award is pending.

Long-Term Incentive Plans

We currently have no employee incentive plans.

Director Compensation

Our directors receive no compensation for their serving as directors.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information known to us relating to the beneficial ownership of shares of our voting securities by: each person who is known by us to be the beneficial owner of more than 5% of our outstanding voting stock; each director; each named executive officer; and all named executive officers and directors as a group. The percentages in the table have been calculated on the basis of treating as outstanding for a particular person, all shares of our common stock outstanding on that date and all shares of our common stock issuable to that holder in the event of exercise of outstanding options, warrants, rights or conversion privileges owned by that person at that date which are exercisable within 60 days of that date. Except as otherwise indicated, the persons listed below have sole voting and investment power with respect to all shares of our common stock owned by them, except to the extent that power may be shared with a spouse.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Employment Agreements

We entered into an employment agreement with Henry D. Fahman on April 15, 2009, to serve as our President and Chief Executive Officer. This employment agreement is automatically renewed after every third-year anniversary and may terminate either with a minimum of ninety-days’ advance notice by either party, or due to Mr. Fahman’s death, insanity, disability, for cause or any time by mutual agreement in writing. It is our intention to enter into employment agreements with other executive officers in the future.

Class B Series I Preferred Stock

We have issued the following amounts of Class B Series I Preferred Stock to our executive officers and members of our Board of Directors to afford them the ability to make time-sensitive decisions regarding special business opportunities and transactions that they deem to be in the best interest of our company and our shareholders. The shares of Class B Series I Preferred Stock have super-voting rights but are not convertible into shares of our common stock. (See “Description of Securities—Preferred Stock—Class B Series I Preferred Stock”).

Advances from Related Parties

Henry D. Fahman, Chairman and Chief Executive Officer of our company, and Tam Bui, a Director of our company, have from time to time made cash advances to us. The advances are unsecured, interest free and payable on demand. A September 30, 2021, we owed Mr. Fahman a total of $1,056,972 and Mr. Bui a total of $663,350. Funds received from Messrs. Fahman and Bui were used for operating expenses

Other Interests of Management

Certain of the officers and directors of our company are engaged in other businesses, either individually or through partnerships and corporations in which they have an interest, hold an office or serve on a board of directors. As a result, certain conflicts of interest may arise between our company and its officers and directors. We will attempt to resolve such conflicts of interest in favor of our company. Our officers and directors are accountable to our company and our shareholders as fiduciaries, which requires that such officers and directors exercise good faith and integrity in handling the affairs of our company. A shareholder may be able to institute legal action on behalf of our company or on behalf of such shareholder and other similarly situated shareholders to recover damages or for other relief in cases of the resolution of conflicts is in any manner prejudicial to our company.

PHILUX Capital Advisors, Inc.

Henry D. Fahman, our Chairman and Chief Executive Officer, also serves as Interim Chief Executive Officer of American Laser Healthcare Corp., a Delaware corporation and a client of PHILUX Capital Advisors, Inc.

LEGAL MATTERS

Certain legal matters with respect to the Offered Shares offered by this Offering Circular will be passed upon by Newlan Law Firm, PLLC, Flower Mound, Texas.

WHERE YOU CAN FIND MORE INFORMATION

We have filed an offering statement on Form 1-A with the SEC under the Securities Act with respect to the common stock offered by this Offering Circular. This Offering Circular, which constitutes a part of the offering statement, does not contain all of the information set forth in the offering statement or the exhibits and schedules filed therewith. For further information with respect to us and our common stock, please see the offering statement and the exhibits and schedules filed with the offering statement. Statements contained in this Offering Circular regarding the contents of any contract or any other document that is filed as an exhibit to the offering statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the offering statement. The offering statement, including its exhibits and schedules, may be inspected without charge at the public reference room maintained by the SEC, located at 100 F Street, N.E., Room 1580, Washington, D.C. 20549, and copies of all or any part of the offering statement may be obtained from such offices upon the payment of the fees prescribed by the SEC. Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. The SEC also maintains an Internet website that contains all information regarding companies that file electronically with the SEC. The address of the website is www.sec.gov.

INDEX TO FINANCIAL STATEMENTS

PHI Group, Inc.

Audited Financial Statements for the Years Ended June 30, 2021 and 2020

PHI GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

The accompanying notes form an integral part of these audited consolidated financial statements

PHI GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)

FOR THE THREE MONTHS ENDED

The accompanying notes form an integral part of these audited consolidated financial statements

PHI GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(UNAUDITED)