UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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): October 31, 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.) |
c/o GD Culture Group Limited
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(c) under the Exchange Act (17 CFR 240.13e-4(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 |
Item 1.01 Entry into a Material Definitive Agreement.
On or about November 1, 2023, GD Culture Group Limited (the “Company”, “we”, “us” or “our”) entered into a placement agency agreement (the “Placement Agency Agreement”), with Univest Securities, LLC (the “Placement Agent” or “Univest”). Pursuant to the Placement Agency Agreement, the Placement Agent agrees to use its reasonable best efforts to sell the Company’s common stock (the “Common Stock”) in a registered direct offering (the “Offering”). The Placement Agent has no obligation to buy any of the securities from us or to arrange for the purchase or sale of any specific number or dollar amount of securities.
In the Offering, (i) an aggregate of 1,436,253 shares of common stock (the “Common Shares”) of the Company, par value $0.0001 per share, (ii) pre-funded warrants to purchase up to an aggregate of 1,876,103 shares of common stock (the “Pre-Funded Warrants”, and the common stock underlying such warrants, the “Pre-Funded Warrant Shares”), and (iii) registered warrants to purchase up to an aggregate of 3,312,356 shares of common stock (the “Registered Warrants”, and the common stock underlying such warrants, the “Registered Warrant Shares”) are sold to certain purchasers (the “Purchasers”), pursuant to a securities purchase agreement, dated October 31, 2023 (the “Securities Purchase Agreement”). The purchase price of each Common Share is $3.019. The purchase price of each Pre-funded Warrant is $3.018, which equals the price per Common Share being sold in this Offering, minus $0.001. The Pre-funded Warrants will be exercisable immediately after issuance and will expire five (5) years from the date of issuance. The Registered Warrants will be exercisable immediately and will expire five (5) years from the date of issuance.
The Offering is being made pursuant to a shelf registration statement (No. 333-254366) on Form S-3, which was declared effective by the U.S. Securities and Exchange Commission (the “SEC”) on March 26, 2021, and related prospectus supplement.
The net proceeds from the Offering, after deducting placement agent discounts and commissions and estimated offering expenses payable by the Company, are approximately $9.05 million (assuming the Registered Warrants are not exercised). The Company intends to use the net proceeds from the Offering for working capital and general corporate purposes.
Pursuant to the Placement Agency Agreement, the Company has agreed to pay the Placement Agent a total cash fee equal to 7.0% of the aggregate gross proceeds received in the Offering. The Company also agreed to reimburse the Placement Agent certain out-of-pocket accountable expenses incurred in this Offering up to $150,000.
In concurrent with the Offering, on November 1, 2023, the Company entered into certain warrant exchange agreements (the “Warrant Exchange Agreements”) with certain holders of warrants issued by the Company on May 16, 2023 in a private placement (the “Existing Warrants”), to purchase up to 1,154,519 shares of the Company’s Common Stock (the “Holders”). Pursuant to the Warrant Exchange Agreements, the Holders shall surrender the Existing Warrants, and the Company shall cancel the Existing Warrants and shall issue to Holders pre-funded warrants to purchase up to 577,260 shares of the Company’s Common Stock (the “Exchange Warrants”). The Exchange Warrants were issued to Holders on November 3, 2023 and the warrant exchange closed on the same day.
Pre-funded Warrants
“Pre-funded” refers to the fact that the purchase price of the warrants in the offering includes almost the entire exercise price that will be paid under the Pre-funded Warrants, except for a nominal remaining exercise price of $0.001. The purpose of the Pre-funded Warrants is to enable Purchasers that may have restrictions on their ability to beneficially own more than 4.99% (or, upon election of the holder, 9.99%) of the Company’s outstanding Common Stock following the consummation of the offering the opportunity to make an investment in the Company without triggering their ownership restrictions, by receiving Pre-funded Warrants in lieu of the Company’s common stock which would result in such ownership of more than 4.99% (or 9.99%), and receive the ability to exercise their option to purchase the shares underlying the Pre-funded Warrants at such nominal price at a later date. In the Offering, each Pre-funded Warrant is exercisable for one share of our Common Stock, with an exercise price equal to $0.001 per share, at any time that the Pre-funded Warrant is outstanding. The Pre-funded Warrants will be exercisable immediately after issuance and will expire five (5) years from the date of issuance. The holder of a Pre-funded Warrant will not be deemed a holder of our underlying common stock until the Pre-funded Warrant is exercised.
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Registered Warrants
In the Offering, the Company issued to such Purchasers warrants to purchase up to 3,312,356 shares of Common Stock. The Registered Warrants will be exercisable immediately and will expire five (5) years from the date of issuance. The Exercise Price of the Registered Warrants is $3.019, subject to adjustment as provided in the form of Registered Warrants.
Placement Agent Warrants
Pursuant to the Placement Agency Agreement, the Company agreed to issue the Placement Agent Warrants to the Placement Agent to purchase up to 331,236 shares of Common Stock (equal to 5.0% of the aggregate number of Common Shares, and shares of Common Stock underlying the Pre-Funded Warrants sold in this offering, and the number of shares of Common Stock underlying the Registered Warrants) at an exercise price of $3.623 per share, which represents 120% of the offering price. The Placement Agent’s Warrants are not covered by the shelf registration statement (No. 333-254366) on Form S-3, which was declared effective by the SEC on March 26, 2021, and related prospectus supplement.
Exchange Warrants
Pursuant to the Warrant Exchange Agreements, the Holders agreed to surrender the Existing Warrants and the Company shall cancel the Existing Warrants and shall issue to Holders pre-funded warrants to purchase up to 577,260 shares of Common Stock (the “Exchange Warrants”). The Exchange Warrants have the same terms and conditions as the Pre-funded Warrants. The Exchange Warrants are not covered by the shelf registration statement (No. 333-254366) on Form S-3, which was declared effective by the SEC on March 26, 2021, and related prospectus supplement. The issuance of the Exchange Warrants is intended to be exempt from registration by virtue of Section 3(a)(9) of the Securities Act of 1933, as amended.
The Placement Agency Agreement is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference. The form of Securities Purchase Agreement is filed as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated herein by reference. The form of Warrant Exchange Agreement is filed as Exhibit 10.3 to this Current Report on Form 8-K and is incorporated herein by reference. The form of Pre-funded Warrants is filed as Exhibit 4.1 to this Current Report on Form 8-K and is incorporated herein by reference. The form of Registered Warrants is filed as Exhibit 4.2 to this Current Report on Form 8-K and is incorporated herein by reference. The foregoing descriptions of the terms of the Securities Purchase Agreement and form of Pre-funded Warrant and Registered Warrants do not purport to be complete descriptions of the rights and obligations thereunder and are qualified in their entirety by reference to such exhibits. A copy of the opinion of the Company’s counsel, relating to the validity of the Common Shares, Pre-funded Warrants, and the Registered Warrants in connection with the Offering, is filed as Exhibit 5.1 to this Current Report on Form 8-K.
Item 8.01 Other Events.
On November 1, 2023, the Company issued a press release announcing the pricing of the Offering, a copy of which is attached hereto as Exhibit 99.1.
On November 3, 2023, the Company issued a press release announcing the closing of the Offering, a copy of which is attached hereto as Exhibit 99.2.
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Item 9.01. Financial Statements and Exhibits
Exhibit Number | Description of Exhibit | |
4.1 | Form of Pre-funded Warrants | |
4.2 | Form of Registered Warrants | |
5.1 | Opinion of Ortoli Rosenstadt LLP | |
10.1 | Placement Agency Agreement, dated November 1, 2023 | |
10.2 | Form of Securities Purchase Agreement™ between the Company and certain Purchasers, dated October 31, 2023 | |
10.3 | Warrant Exchange Agreement, dated November 1, 2023 | |
23.1 | Consent of Ortoli Rosenstadt LLP (included in Exhibit 5.1) | |
99.1 | Pricing Press Release dated November 1, 2023 | |
99.2 | Closing Press Release dated November 3, 2023 | |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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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: November 3, 2023 | By: | /s/ Xiaojian Wang |
Name: | Xiaojian Wang | |
Title: | Chief Executive Officer, President and Chairman of the Board |
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