Item 3. Legal Proceedings
ITEM 3. LEGAL PROCEEDINGS
On August 24, 2021, Millennium
Fine Art Inc. (“MFAI”) filed a complaint against the Company in the 8 th District Court of Clark County, State of
Nevada, captioned Millennium Fine Art Inc. v. Greenpro Capital Corp. (Case No. A-21-840033-B). MFAI alleges that on or about April 21,
2021, MFAI and the Company entered into a contract (the “Contract”) pursuant to which MFAI agreed to create approximately
7,700 non-fungible tokens (“NFTs”) in exchange for $16 million in shares of the Company’s common stock. MFAI contends
that the Company breached the Contract by refusing delivery of the NFTs and failing to issue the agreed-upon shares. The complaint asserts
cause of action for breach of contract, special damages, and promissory estoppel, and seeks approximately $66 million in damages, specific
performance of the alleged Contract, and attorney’s fees and costs.
On October 18, 2021, the Company
filed a motion, denying all the material allegations of the complaint, and seeking to stay the litigation and compel arbitration pursuant
to the purported the Contract’s arbitration clause. The Company’s motion sought only to enforce the arbitration provision
and otherwise denied the existence of a valid and binding contract. Over MFAI’s opposition, the court granted the Company’s
motion and stayed the proceeding pending arbitration.
On or about April 1, 2022, MFAI
filed a Request for Arbitration with Judicial Arbitration and Mediation Services, Inc. (JAMS). The Company subsequently filed its Statement
of Answer, denying the material allegations and asserting that the claims are without merit. The arbitration remains in the discovery
phase, and the Company intends to vigorously defend this matter. A final arbitration hearing is currently scheduled to be held in Las
Vegas, Nevada, from July 14 through July 17, 2026.
The Company is currently unable
to reasonably estimate the possible loss or range of losses, if any, that may result from this proceeding. Management does not believe,
based on information presently available, that the outcome of this matter will have a material adverse effect on the Company’s financial
condition or results of operations; however, an adverse determination could have such an effect.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
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PART II
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