Joint Venture Between Ispire and Berify for PMTA and Software Development

According to a press release by the U.S. Securities and Exchange Commission on February 1st, on January 31st, Ispire Technology, Inc. (hereinafter referred to as the "Company") signed a letter of intent and term sheet (hereinafter referred to as the "Term Sheet") with Touch Point Worldwide Inc., also known as Berify (hereinafter referred to as "Berify"), a technology company specializing in linking physical products to the digital world, digital interaction, and brand protection.

According to the terms outlined in the agreement, all parties intend to establish a new joint venture company known as "NewCo" in the state of Delaware. Ispire and Berify will hold 50% ownership each in NewCo. Ispire will invest a total of $10 million in NewCo, which will be utilized to support the pre-market tobacco product application submitted to the US Food and Drug Administration, as well as for software development.

Berify agrees to an exclusive period where its intellectual property related to products used for inhaling, vaporizing, atomizing, or heating nicotine and/or tobacco, as well as any packaging related to its product authentication system, blockchain technology for product identification, connected device platforms (such as applications and dashboards), and smart chips or tags (or similar technologies) (referred to as "Berify licensed assets") will be exclusively held by Berify. During this period, Berify agrees not to engage in any discussions or negotiations related to the acquisition or licensing of Berify licensed assets without prior approval from the company. Upon the finalization of the agreement, the company agrees to issue warrants to Berify for the purchase of 111,111 shares of the company's common stock at an exercise price of $9.00 per share.

The clause states that negotiations should be conducted in good faith, with the aim of implementing the provisions outlined in the term sheet into a final agreement. The signing of the final agreement is subject to various uncertainties, including the completion of customary due diligence by all parties, negotiations on the final agreement, approval by the respective boards of directors, and the fulfillment of other customary closing conditions, including but not limited to obtaining any necessary government and third-party approvals. There is no guarantee that the final agreement will be signed in accordance with the provisions set forth in the term sheet or in any other manner. If the final agreement is not signed by April 1, 2024 (referred to as the "deadline" hereafter), the term sheet shall be considered void, and all parties will be released from the obligations contained therein. The deadline may be extended at any time by mutual agreement in writing.