Company: PAVS
Filing Date: 2025-10-28
Form Type: 424B5
Source: 0001929980-25-000683
Chunk: 31

Company: Paranovus Entertainment Technology Ltd.
Filing Date: 2025-10-28
Form: 424B5
Chunk 31
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2022. Due to the lingering adverse impacts of COVID-19 and sluggish macro-economic condition in China, the management does not expect short-term turn-over of these businesses and therefore the Board decided to suspend these loss-incurring businesses. After disposition of its nutraceutical and dietary supplements business in August 2023 and suspension of the e-commerce and internet information and advertising business expected in September 2023, the Company’s only remaining operating business based in China is the automobile sales business, a B2B business committed to optimizing the auto supply chain by connecting car dealers via an online automobile sales platform and offering overall services for automobile purchasing.

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On September 3, 2023, the Company entered into a non-binding letter of intent with Blueline Studios, Inc. (“BlueLine”) to acquire 100% of BlueLine’s equity interests. Headquartered in Vancouver, Canada, Blueline Studios Inc. is a gaming studio that specializes in creating interactive entertainment in collaboration with celebrities and athletes.

On November 12, 2023, the Company entered into a software development agreement (the “Development Agreement”) with Blueline. Pursuant to the Development Agreement, Blueline shall be responsible for developing and delivering certain interactive game application (“Hollywood Sunshine”), including the underlying software, documentation, and technical data, under the terms and conditions of the Development Agreement, and agreed to assign to the Company all the right, title, and interest in Hollywood Sunshine, excluding any Background Technology (as defined in the Development Agreement). Blueline will deliver the initial full-featured version for the PC platform (the “PC Release”) six months after the Start Date as defined in the Development Agreement, followed by the delivery of iOS version (the “iOS Release”) three months after the PC Release. In exchange, the Company agreed to pay a total of $1,500,000 development fee to Blueline for the PC Release, and $400,000 development fee for the iOS Release, in accordance with the schedule set forth in the Development Agreement. The decision to develop the iOS Release is at the discretion of the Company. Furthermore, once Hollywood Sunshine starts generating revenues, the Company agreed to pay Blueline 9% of the net revenue after deducting all the licensing fees owned to all talent partners.

On November 9, 2023, the Company signed a promissory note purchase agreement with a non-U.S. investor (the “Investor”), pursuant to which, the Company will issue an 8%