|SEVEN STARS CLOUD GROUP, INC. filed this Form 10-Q on 11/13/2017|
Seven Stars Cloud Group, Inc., Its Subsidiaries
and Variable Interest Entities
both minimum guarantee payments and revenue sharing arrangements with distribution partners as well as subscription or transactional fees from subscribers.
Wecast Services - Wecast Services (which resides under the Product Sales Cloud) is currently primarily engaged with consumer electronics and smart supply chain management operations.
Segment disclosures are on a performance basis consistent with internal management reporting. The Company does not allocate expenses below segment gross profit since these segments share the same executive team, office space, occupancy expenses, information technology infrastructures, human resources and finance department. The following tables summarized the Company’s revenue and cost generated from different revenue streams.
On October 17, 2017, Wecast Services Group Limited (“Wecast”), a wholly owned subsidiary of the Company, entered into a Technical License Agreement with Guangxi Dragon Coin Network Technology Co., Ltd. (“Guangxi”), pursuant to which Wecast has agreed to provide Guangxi with a non-exclusive agreement to license the technology platform from Wecast’s Red Coin Chain. Pursuant to the terms of the License Agreement, Guangxi, a subsidiary of Courage Investment Group Limited (1145.HK) (“Courage Investment Group”), will be granted a non-exclusive license from Wecast and the Red Coin Chain (“Red Coin”), to use Red Coin’s technology platform specifically and exclusively for real estate based securitization. In exchange and in consideration for, the non-exclusive rights to the technology, the Company will receive 17.9% of the existing total equity of Courage Investment Group, which is Guangxi’s Hong Kong listed parent company.
On October 23, 2017, the Company entered into a Securities Purchase Agreement with Hong Kong Guo Yuan Group Capital Holdings Limited. Pursuant to the terms of the agreement, the Company has agreed to sell and issue 5,494,505 shares of the Company’s common stock to the Hong Kong Guo Yuan Group Capital Holdings Limited for $1.82 per share, or a total purchase price of $10.0 million.
On November 9, 2017, the Board of Directors approved Amendment No. 7 to $3.0 million Convertible Promissory Notes (“Note”) issued to Mr. Shane McMahon, our Vice Chairman, pursuant to which the maturity date of the Note was extended to December 31, 2019. The Note remains payable on demand or convertible on demand into Common Stock at a conversion price of $1.50.