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SEC Filings

10-Q
SEVEN STARS CLOUD GROUP, INC. filed this Form 10-Q on 11/13/2017
Entire Document
 

 

Seven Stars Cloud Group, Inc., Its Subsidiaries and Variable Interest Entities
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

(b) Warrants

 

In connection with the Company’s financings, the Warner Brother Agreement and the service agreements, the Company issued warrants to service providers to purchase common stock of the Company.

 

As of September 30, 2017, the weighted average exercise price of the warrants was $2.33 and the weighted average remaining life was 0.81 years. The following table outlines the warrants outstanding and exercisable as of September 30, 2017 and December 31, 2016:

 

   September 30,   December 31,         
   2017   2016         
   Number of   Number of         
   Warrants   Warrants       
Warrants Outstanding  Outstanding and
Exercisable
   Outstanding and
Exercisable
   Exercise
Price
   Expiration
Date
 
                 
2012 August Financing Warrants  (i)   -    536,250   $1.50    08/30/17 
2013 Broker Warrants (Series D Financing)   100,000    228,571    1.75    07/05/18 
2013 Broker Warrants (Convertible Note)   114,285    114,285    1.75    11/04/18 
2014 Broker Warrants (Series E Financing)   1,085,714    1,085,714    1.75    01/31/19 
2016 Warrants to SSS (Note 12)   1,818,182    1,818,182   $2.75    03/28/18 
    3,118,181    3,783,002           

 

(i)The warrants are classified as derivative liabilities as disclosed in Note 13.

 

(c) Restricted Shares

 

In January, 2017, the Company granted 35,000 restricted shares to one employee under the “2010 Plan”. The restricted shares have a vesting period of four years with the first one-fourth vesting on the first anniversary from grant date and the remaining three-fourth vesting ratably over twelve quarters. The grant date fair value of the restricted shares was $43,750. As this employee left the Company in February, no expense was recorded.

 

In March and April, 2017, the Company granted 365,000 restricted shares to certain employees under the “2010 Plan”. The restricted shares have a vesting period of four years with the first one-fourth vesting on the first anniversary from grant date and the remaining three-fourth vesting ratably over twelve quarters. The grant date fair value of the restricted shares was $778,200.

 

A summary of the restricted shares is as follows:

 

   Shares   Weighted-average 
 fair value
 
Restricted shares outstanding at January 1, 2017   228,550   $1.75 
Granted   400,000    2.05 
Forfeited   (95,000)   1.65 
Vested   (111,465)   1.73 
Restricted shares outstanding at September 30, 2017   422,085   $2.07 

 

15.Loss Per Common Share

 

   Three Months Ended   Nine Months Ended 
   September 30,   September 30,   September 30,   September 30, 
   2017   2016   2017   2016 
Net loss attributable to common stockholders  $(3,044,597)  $(2,047,204)  $(4,491,943)  $(5,771,763)
Basic                    
Basic weighted average shares outstanding   62,146,168    41,184,037    59,594,289    31,640,230 
                     
Diluted                    
Diluted weighted average common shares outstanding   62,146,168    41,184,037    59,594,289    31,640,230 
                     
Net loss per share:                    
Basic  $(0.05)  $(0.05)  $(0.08)  $(0.18)
Diluted  $(0.05)  $(0.05)  $(0.08)  $(0.18)

 

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