0001213900-23-081037.txt : 20230929 0001213900-23-081037.hdr.sgml : 20230929 20230929163012 ACCESSION NUMBER: 0001213900-23-081037 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 13 CONFORMED PERIOD OF REPORT: 20230926 ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20230929 DATE AS OF CHANGE: 20230929 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GD Culture Group Ltd CENTRAL INDEX KEY: 0001641398 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-METALS, MINERALS (NO PETROLEUM) [5050] IRS NUMBER: 473709051 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-37513 FILM NUMBER: 231296122 BUSINESS ADDRESS: STREET 1: 22F-810 SEVENTH AVENUE CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 1-347-259-0292 MAIL ADDRESS: STREET 1: 22F-810 SEVENTH AVENUE CITY: NEW YORK STATE: NY ZIP: 10019 FORMER COMPANY: FORMER CONFORMED NAME: Code Chain New Continent Ltd DATE OF NAME CHANGE: 20200518 FORMER COMPANY: FORMER CONFORMED NAME: TMSR HOLDING Co Ltd DATE OF NAME CHANGE: 20180207 FORMER COMPANY: FORMER CONFORMED NAME: JM Global Holding Co DATE OF NAME CHANGE: 20150505 8-K/A 1 ea185974-8ka1_gdculture.htm AMENDMENT NO.1 TO FORM 8-K
0001641398 true 8-K/A 0001641398 2023-09-26 2023-09-26 iso4217:USD xbrli:shares iso4217:USD xbrli:shares

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

AMENDMENT NO.1 TO

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

 

Date of report (Date of earliest event reported): September 26, 2023

 

GD Culture Group Limited

(Exact name of Company as specified in charter)

 

Nevada   001-37513   47-3709051
(State or other jurisdiction
of incorporation)
  (Commission File No.)   (IRS Employer
Identification No.)

 

22F - 810 Seventh Avenue,
New York, NY 10019

(Address of Principal Executive Offices) (Zip code)

 

+1-347-2590292

(Company’s Telephone number, including area code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Company under any of the following provisions (see General Instruction A.2. below):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4© under the Exchange Act (17 CFR 240.13(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

  

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common Stock, par value $0.0001   GDC   Nasdaq Capital Market

 

 

 

 

 

 

Explanatory Note

 

On September 26, 2023, GD Culture Group Limited (the “Company”) filed with the United States Securities and Exchange Commission a Current Report on Form 8-K (the “8-K Report”) reporting the termination of certain VIE agreements between Shanghai Highlight Entertainment Co., Ltd., an indirect subsidiary of the Company (“Highlight WFOE”), Shanghai Highlight Media Co., Ltd., a PRC company (“Highlight Media”), and the shareholders of Shanghai Highlight (the “Highlight Media Shareholders”) on September 26, 2023. As a result of such termination, the Company will no longer treat Highlight Media as a consolidated affiliated entity or consolidate the financial results and balance sheet of Highlight Media in the Company’s consolidated financial statements under U.S. GAAP.

 

This Amendment is being filed to file the unaudited Pro Forma Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) of the Company for the six months ended June 30, 2023 and 2022 and the unaudited Pro Forma Condensed Consolidated Balance Sheets of the Company as of June 30, 2023 required by Item 9.01 of Form 8-K, and this Amendment should be read in conjunction with the 8-K Report.

 

1

 

 

Item 9.01 Financial Statements and Exhibits.

 

(b) Pro forma financial information.

 

(d) Exhibits.

 

Exhibit No.   Description
99.1   Unaudited pro forma condensed consolidated financial statements of the Company
104   Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

2

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  GD CULTURE GROUP LIMITED
   
Date: September 29, 2023 By: /s/ Xiao Jian Wang
  Name:   Xiao Jian Wang
  Title: Chief Executive Officer, President and
Chairman of the Board

 

 

3

 

 

EX-99.1 2 ea185974ex99-1_gdculture.htm UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF THE COMPANY

Exhibit 99.1

 

GD CULTURE GROUP LIMITED AND SUBSIDIARIES

PROFORMA CONDENSED DECONSOLIDATED BALANCE SHEETS

AT JUNE 30, 2023

 

      less:        
   GDC
CONS
   Highlight
Media
   ADJUSTMENTS   GDC
DECONS
 
ASSETS                
CURRENT ASSETS                
Cash and cash equivalents  $7,400,739    62,615    -   $7,338,124 
Accounts receivable, net   218,077    68,077    -    150,000 
Other receivables, net   1,178,684    78,684    100,000    1,200,000 
Prepayments   173,334    303    -    173,031 
Total current assets   8,970,834    209,679    100,000    8,861,155 
                     
NON-CURRENT ASSETS             -    - 
Plant and equipment, net   5,032    478         4,554 
Goodwill   2,083,518    -    (2,083,518)   - 
Intangible assets, net   750,000    -         750,000 
                     
Total non-current assets   2,838,550    478    (2,083,518)   754,554 
                     
Total assets  $11,809,384    210,157    (1,983,518)  $9,615,709 
                     
LIABILITIES AND SHAREHOLDERS’ EQUITY                    
                     
CURRENT LIABILITIES                    
Accounts payable  $4,961    4,961    -   $- 
Other payables and accrued liabilities   1,739    1,739    -    - 
Other payables - related parties   35,188    35,188    -    - 
Customer deposits   68,953    68,953    -    - 
Taxes payable   269    269    -    - 
Total current liabilities   111,110    111,110    -    - 
                     
Total liabilities   111,110    111,110    -    - 
                     
COMMITMENTS AND CONTINGENCIES                    
                     
SHAREHOLDERS’ EQUITY                    
Preferred stock, $0.0001 par value, 20,000,000 shares authorized, no shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively   -    -    -    - 
Common stock, $0.0001 par value, 200,000,000 shares authorized, 3,053,563 and 1,844,877 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively   305    -    -    305 
Additional paid-in capital   68,644,206    -    -    68,644,206 
Statutory reserves   4,467    4,467    -      
Accumulated deficit   (57,017,881)   106,121    (1,983,518)   (59,107,520)
Accumulated other comprehensive income   67,177    (11,541)   -    78,718 
Total shareholders’ equity   11,698,274    99,047    (1,983,518)   9,615,709 
                     
Total liabilities and shareholders’ equity  $11,809,384    210,157    (1,983,518)  $9,615,709 

 

1

 

 

GD CULTURE GROUP LIMITED AND SUBSIDIARIES

PROFORMA CONDENSED DECONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE SIX MONTHS ENDED JUNE 30, 2023

 

      less:        
   GDC
CONS
   Highlight Media   ADJUSTMENTS   GDC
DECONS
 
REVENUES                
Enterprise brand management services  $132,173   $132,173   $          -   $- 
Software copyright   150,000    -    -    150,000 
    -    -    -    - 
TOTAL REVENUES   282,173    132,173    -    150,000 
                     
COST OF REVENUES                    
Enterprise brand management services   97,562    97,562    -    - 
TOTAL COST OF REVENUES   97,562    97,562    -    - 
                     
GROSS PROFIT   184,611    34,611    -    150,000 
                     
OPERATING EXPENSES (INCOME)                    
Selling, general and administrative   362,107    86,171    -    275,936 
                     
TOTAL OPERATING EXPENSES   362,107    86,171    -    275,936 
                     
LOSS FROM OPERATIONS   (177,496)   (51,560)   -    (125,936)
                     
OTHER INCOME (EXPENSE)                    
Interest income   222    43    -    179 
Interest expense   (82)   (82)   -    - 
Other income, net   663    663    -    - 
                     
Total other income, net   803    624    -    179 
                     
LOSS BEFORE INCOME TAXES FROM CONTINUING OPERATIONS   (176,693)   (50,936)   -    (125,757)
                     
PROVISION FOR INCOME TAXES   114    114    -    - 
                     
LOSS FROM CONTINUING OPERATIONS   (176,807)   (51,050)   -    (125,757)
                     
Discontinued operations:                    
Loss on disposal, net of taxes   -    -    (1,983,518)   (1,983,518)
                     
Net Loss   (176,807)   (51,050)   (1,983,518)   (2,109,275)
                     
OTHER COMPREHENSIVE INCOME                    
Foreign currency translation adjustment   (112,283)   (11,541)   -    (100,742)
                     
COMPREHENSIVE LOSS  $(289,090)  $(62,591)   (1,983,518)  $(2,210,017)
                     
WEIGHTED AVERAGE NUMBER OF COMMON SHARES                    
Basic and diluted on proforma basis   2,137,653    -    -    2,137,653 
                     
Loss per share from continuing operations                    
Basic and diluted   (0.08)   -    -    (0.06)
                     
Loss  per share from discontinued operations                    
Basic and diluted   -    -    -    (0.93)
                     
Loss per share available to common shareholders                    
Basic and diluted on a proforma basis  $(0.08)  $-    -   $(0.99)

 

2

 

 

GD CULTURE GROUP LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE SIX MONTHS ENDED JUNE 30, 2022

 

         less:        
   GDC
CONS
   less:
WUGE
   Highlight
Media
   ADJUSTMENTS   GDC
DECONS
 
REVENUES                         
Wuge digital door signs  $7,616,615   $7,616,615   $          -   $           -   $- 
    -    -    -    -    - 
TOTAL REVENUES   7,616,615    7,616,615    -    -    - 
                          
COST OF REVENUES                         
Wuge digital door signs   5,527,950    5,527,950    -    -    - 
TOTAL COST OF REVENUES   5,527,950    5,527,950    -    -    - 
                          
GROSS PROFIT   2,088,665    2,088,665    -    -    - 
                          
OPERATING EXPENSES (INCOME)                         
Selling, general and administrative   8,341,973    1,605,935    -    -    6,736,038 
Provision for doubtful accounts   12,949,329    -    -    -    12,949,329 
TOTAL OPERATING EXPENSES   21,291,302    1,605,935    -    -    19,685,367 
                          
LOSS FROM OPERATIONS   (19,202,637)   482,730    -    -    (19,685,367)
                          
OTHER INCOME (EXPENSE)                         
Interest income   65,251    65,251    -    -    - 
Interest expense   (935)   (935)   -    -    - 
Other income, net   70,830    70,830    -    -    - 
                          
Total other income, net   135,146    135,146    -    -    - 
                          
LOSS BEFORE INCOME TAXES FROM CONTINUING OPERATIONS   (19,067,491)   617,876    -    -    (19,685,367)
                          
PROVISION FOR INCOME TAXES   314,787    314,787    -    -    - 
                          
LOS FROM CONTINUING OPERATIONS   (19,382,278)   303,089    -    -    (19,685,367)
                          
Discontinued operations:                         
Loss on disposal, net of taxes   -    -    -    (246,369)   (246,369)
                          
Net Los   (19,382,278)   303,089    -    (246,369)   (19,931,736)
                          
OTHER COMPREHENSIVE INCOME                         
Foreign currency translation adjustment   (935)   204,195    -    -    (205,130)
                          
COMPREHENSIVE LOSS  $(19,383,213)  $507,284    -    (246,369)  $(20,136,866)
                          
WEIGHTED AVERAGE NUMBER OF COMMON SHARES                         
Basic and diluted on proforma basis   41,065,559    -    -    (4,000,000)   37,065,559 
                          
Loss per share from continuing operations                         
Basic and diluted   (0.47)   -    -    -    (0.53)
                          
Loss per share from discontinued operations                         
Basic and diluted   -    -    -    -    (0.01)
                          
Loss per share available to common shareholders                         
Basic and diluted on a proforma basis  $(0.47)  $-    -    -   $(0.54)

 

3

 

 

GD CULTURE GROUP LIMITED AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

Note 1 – Nature of business and organization

 

GD Culture Group Limited (“GDC” or the “Company”), formerly known as Code Chain New Continent Limited, TMSR Holding Company Limited and JM Global Holding Company is a Nevada corporation and a holding company that has no material operation of its own. The Company’s current and previous subsidiaries, Citi Profit Investment Holding Limited (“Citi Profit”), TMSR Holdings Limited (“TMSR HK”), Highlights Culture Holding Co., Limited (“Highlight HK”), Shanghai Highlight Entertainment Co., Ltd. (“Highlight WFOE”), and Makesi IoT Technology (Shanghai) Co., Ltd. (“Makesi WFOE”) are also holding companies with no material operations. 

 

Highlight WFOE has a series of contractual arrangement with Shanghai Highlight Media Co., Ltd. (“Highlight Media”) that established a VIE structure. For accounting purposes, Highlight WFOE is the primary beneficiary of Highlight Media. Accordingly, under U.S. GAAP, GDC treats Highlight Media as the consolidated affiliated entity and has consolidated Highlight Media’s financial results in GDC’s financial statements. Highlight Media was founded in 2016. It is an integrated marketing service agency, focusing on enterprise brand management, crisis public relations, intelligent public opinion monitoring, media PR, financial and economic we-media operation, digital face application, large-scale exhibition services and other businesses. It is committed to becoming a modern science and technology media organization that fully empowers the development of customer enterprises in the era of artificial intelligence and big data.

  

The VIE structure involves unique risks to investors. The VIE agreements have not been tested in a court of law and the Chinese regulatory authorities could disallow this VIE structure, which would likely result in a material change in our operations and the value of our securities, including that it could cause the value of such securities to significantly decline or become worthless.

 

AI Catalysis Corp. (“AI Catalysis“) is a Nevada corporation, incorporated on May 18, 2023. AI Catalysis is expected to bridge the realms of the internet, media, and artificial intelligence (“AI”) technologies. Positioned at the crossroads of traditional and streaming media, AI Catalysis plans to elevate the experience of media with AI-based interactive and smart content, aiming to transform the whole media landscape. At present, AI Catalysis' primary focus is the application of AI digital human technology with the sectors of e-commerce and entertainment to improve the interaction experiences online. AI Catalysis strives to deliver stable interactive livestreaming products to AI Catalysis' users. AI Catalysis foresees future expansion to a variety of business sectors with AI applications in different scenarios. AI Catalysis plans to enter into the livestreaming market with a focus on e-commerce and livestreaming interactive game.

 

Prior to September 28, 2022, we also conducted business through Sichuan Wuge Network Games Co., Ltd. (“Wuge”). Makesi WFOE had a series of contractual arrangement with Wuge that established a VIE structure. Wuge focused its business on research, development and application of Internet of Things (IoT) and electronic tokens Wuge digital door signs. On September 28, 2022, Makesi WFOE entered into a termination agreement with Wuge and the shareholders of Wuge to terminate the VIE Agreements and to cancel the Shares, based on the average closing price of $0.237 per share of the Company during the 30 trading days immediately prior to the date of the termination agreement. As a result of such termination, the Company no longer treats Wuge as a consolidated affiliated entity or consolidates the financial results and balance sheet of Wuge in the Company’s consolidated financial statements under U.S. GAAP. 

  

Prior to June 26, 2023, we had a subsidiary TMSR HK, which owns 100% equity interest in Makesi WFOE. Makesi WFOE had a series of contractual arrangement with Shanghai Yuanma Food and Beverage Management Co., Ltd. (“Yuanma”) that established a VIE structure. For accounting purposes, Makesi WFOE was the primary beneficiary of Yuanma. Accordingly, under U.S. GAAP, GDC treated Yuanma as the consolidated affiliated entity and has consolidated Yuanma’s financial results in GDC’s financial statements prior to June 26, 2023. On June 26, 2023, GDC entered into a share purchase agreement with a buyer unaffiliated with the Company. Pursuant to the agreement, the Company agreed to sell and the buyer agreed to purchase all the issued and outstanding equity interest in TMSR HK. The purchase price for the transaction contemplated by the Agreement was $100,000. TMSR The sale of TMSR HK included the sale of Makesi WFOE and Yuanma. None of TMSR HK, Makesi WFOE or Yuanma had any assets, employees or operation. The sale of TMSR HK did not have any material impact on the Company’s consolidated financial statements.

 

4

 

 

On September 26, 2023, Highlight WFOE entered into a termination agreement (the “Termination Agreement”) with Highlight Media, the Highlight Media Shareholders and a third party to terminate the VIE Agreements and for the third party to pay the Company $100,000 as consideration to the termination of the VIE Agreements. As a result of such termination, the Company will no longer treat Highlight Media as a consolidated affiliated entity or consolidate the financial results and balance sheet of Highlight Media in the Company’s consolidated financial statements under U.S. GAAP.

 

Note 2 – Summary of significant accounting policies

 

Basis of presentation

 

These proforma financial statements, accompanying notes, and related disclosures have been prepared on an as-if basis assuming that the disposition transaction between the Company, Highlight Media, and a third party has been in effect since the beginning of the period presented. The financial position and results of operations are deconsolidated using historical financial statements. Actual deconsolidated results may have differed from those presented herein. The information included in this Form 8-K should be read in conjunction with information included in the Company’s annual report on Form 10-Q for the six months ended June 30, 2023, filed with the Securities and Exchange Commission on August 14, 2023.

 

Use of estimates and assumptions

 

The preparation of the accompanying proforma financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in the Company’s proforma financial statements include the useful lives of intangible assets, plant and equipment and collectability of receivable. Actual results could differ from these estimates.

  

Foreign currency translation and transaction

 

The reporting currency of the Company is the U.S. dollar. The Company’s subsidiaries and VIEs in China conduct businesses in the local currency, Renminbi (RMB), as its functional currency. Assets and liabilities are translated at the unified exchange rate as quoted by the People’s Bank of China at the end of the period. The statement of income accounts is translated at the average translation rates and the equity accounts are translated at historical rates. Translation adjustments resulting from this process are included in accumulated other comprehensive income. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.

 

The PRC government imposes significant exchange restrictions on fund transfers out of the PRC that are not related to business operations. These restrictions have not had a material impact on the Company because it has not engaged in any significant transactions that are subject to the restrictions.

 

NOTE 3 – PROFORMA ADJUSTMENTS

 

Entry No.  Description  Dr.   Cr. 
1  Other receivables, net  $100,000      
   Loss on disposal, net of taxes   1,983,518      
   Goodwill       $2,083,518 
   De-consolidation adjustment including removal of loss on inter-company balances written off between GDC and Highlight Media.          

 

 

5

 

 

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Cover
Sep. 26, 2023
Cover [Abstract]  
Document Type 8-K/A
Amendment Flag true
Amendment Description On September 26, 2023, GD Culture Group Limited (the “Company”) filed with the United States Securities and Exchange Commission a Current Report on Form 8-K (the “8-K Report”) reporting the termination of certain VIE agreements between Shanghai Highlight Entertainment Co., Ltd., an indirect subsidiary of the Company (“Highlight WFOE”), Shanghai Highlight Media Co., Ltd., a PRC company (“Highlight Media”), and the shareholders of Shanghai Highlight (the “Highlight Media Shareholders”) on September 26, 2023. As a result of such termination, the Company will no longer treat Highlight Media as a consolidated affiliated entity or consolidate the financial results and balance sheet of Highlight Media in the Company’s consolidated financial statements under U.S. GAAP.
Document Period End Date Sep. 26, 2023
Entity File Number 001-37513
Entity Registrant Name GD Culture Group Limited
Entity Central Index Key 0001641398
Entity Tax Identification Number 47-3709051
Entity Incorporation, State or Country Code NV
Entity Address, Address Line One 22F - 810 Seventh Avenue
Entity Address, City or Town New York
Entity Address, State or Province NY
Entity Address, Postal Zip Code 10019
City Area Code +1-347
Local Phone Number 2590292
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.0001
Trading Symbol GDC
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
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As a result of such termination, the Company will no longer treat Highlight Media as a consolidated affiliated entity or consolidate the financial results and balance sheet of Highlight Media in the Company’s consolidated financial statements under U.S. GAAP. 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