Approximate date of commencement of proposed sale
to the public: From time to time after the effective date of the registration statement.
If the only securities being registered on this
Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. ☐
If any of the securities being registered on this
Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☒
If this Form is filed to register additional securities
for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed
pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. ☐
If this Form is a registration statement pursuant
to General Instruction I.C. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant
to Rule 462(e) under the Securities Act, check the following box. ☐
If this Form is a post-effective amendment to
a registration statement filed pursuant to General Instruction I.C. filed to register additional securities or additional classes of securities
pursuant to Rule 413(b) under the Securities Act, check the following box. ☐
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
If an emerging growth company that prepares its
financial statements in accordance with U.S. GAAP, 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 7(a)(2)(B) of the Securities
Act. ☐
ABOUT THIS PROSPECTUS
This prospectus is part of
a registration statement that we filed with the Securities and Exchange Commission, or the SEC, under the Securities Act of 1933, as amended,
or the Securities Act, using a “shelf” registration process. Under this shelf registration process, we may from time to time
sell Ordinary Shares, Preferred Shares, warrants to purchase Ordinary Shares or Preferred Shares, rights or any combination of the foregoing,
either individually or as units comprised of one or more of the other securities, in one or more offerings up to a total dollar amount
of $200,000,000. We have provided to you in this prospectus a general description of the securities we may offer. Each time we sell securities
under this shelf registration, we will, to the extent required by law, provide a prospectus supplement that will contain specific information
about the terms of that offering. We may also authorize one or more free writing prospectuses to be provided to you that may contain material
information relating to these offerings. The prospectus supplement and any related free writing prospectus that we may authorize to be
provided to you may also add, update or change information contained in this prospectus or in any documents that we have incorporated
by reference into this prospectus. To the extent there is a conflict between the information contained in this prospectus and the prospectus
supplement or any related free writing prospectus, you should rely on the information in the prospectus supplement or the related free
writing prospectus; provided that if any statement in one of these documents is inconsistent with a statement in another document having
a later date – for example, a document filed after the date of this prospectus and incorporated by reference into this prospectus
or any prospectus supplement or any related free writing prospectus – the statement in the document having the later date modifies
or supersedes the earlier statement.
We have not authorized any
dealer, agent or other person to give any information or to make any representation other than those contained or incorporated by reference
in this prospectus and any accompanying prospectus supplement, or any related free writing prospectus that we may authorize to be provided
to you. You must not rely upon any information or representation not contained or incorporated by reference in this prospectus or an accompanying
prospectus supplement, or any related free writing prospectus that we may authorize to be provided to you. This prospectus and the accompanying
prospectus supplement, if any, do not constitute an offer to sell or the solicitation of an offer to buy any securities other than the
registered securities to which they relate, nor do this prospectus and the accompanying prospectus supplement constitute an offer to sell
or the solicitation of an offer to buy securities in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation
in such jurisdiction. You should not assume that the information contained in this prospectus, any applicable prospectus supplement or
any related free writing prospectus is accurate on any date subsequent to the date set forth on the front of such document or that any
information we have incorporated by reference is correct on any date subsequent to the date of such document incorporated by reference
(as our business, financial condition, results of operations and prospects may have changed since that date), even though this prospectus,
any applicable prospectus supplement or any related free writing prospectus is delivered or securities are sold on a later date.
As permitted by SEC rules
and regulations, the registration statement of which this prospectus forms a part includes additional information not contained in this
prospectus. You may read the registration statement and the other reports we file with the SEC at its website or at its offices described
below under “Where You Can Find More Information.”
Unless the context otherwise
requires, all references in this prospectus to “Oriental Culture”, “OCG,” “we,” “us,”
“our,” “the Company,” “the “Registrant” or similar words refer to Oriental Culture Holding LTD.,
together with our subsidiaries, VIE and its subsidiaries.
“China” or
the “PRC” are to the People’s Republic of China, excluding Taiwan and the special administrative regions of
Hong Kong and Macau for the purposes of this prospectus only.
PROSPECTUS SUMMARY
Overview
We were incorporated under the laws of the Cayman
Islands as an offshore holding company and we own 100% of the equity interest in Oriental Culture Development LTD (“Oriental Culture
BVI”), which was incorporated under the laws of British Virgin Islands.
Through Oriental Culture BVI, we own 100% of the
equity interest in HK Oriental Culture Investment Development Limited (“Oriental Culture HK”), a company formed under the
laws of Hong Kong. Through Oriental Culture HK, we directly own 100% of the equity interest in Nanjing Rongke Business Consulting Service
Co., Ltd. (the “WFOE” or “Nanjing Rongke”), a wholly-owned PRC subsidiary of Oriental Culture HK. The WFOE entered
into a series of agreements with Jiangsu Yanggu Culture Development Co., Ltd. (“Jiangsu Yanggu” or “VIE”) and
Jiangsu Yanggu’s shareholders, through which we effectively control and derive all of the economic interest and benefits from Jiangsu
Yanggu.
We own 100% equity interest in China International
Assets and Equity of Artworks Exchange Limited (the “International Exchange”), a company incorporated under the laws of Hong
Kong. International Exchange provides an online platform to facilitate collectibles and artwork trading e-commerce and became our subsidiary
as a result of the reorganization of the common control of Oriental Culture and International Exchange. We own 100% equity interest in
HKDAEx Limited (“HKDAEx”), a company incorporated under laws of Hong Kong. HKDAEx provides our customers with online trading
platform for products and commodities other than collectible and artwork in Hong Kong.
Nanjing Yanqing Information Technology Co., Ltd.,
(“Nanjing Yanqing”) and Nanjing Yanyu Information Technology Co., Ltd. (“Nanjing Yanyu”) are wholly-owned subsidiaries
of Jiangsu Yanggu in China. Their primary business is to provide technical and other support for online collectibles and art e-commerce
business for our Hong Kong subsidiaries, and to sell software applications and provide support services to our affiliates and third parties.
Kashi Longrui Business Management Services Co.,
Ltd. (“Kashi Longrui”) is a wholly-owned subsidiary of Nanjing Yanqing, and its primary business is to provide online and
offline marketing service for our e-commerce platform’s members and other related services.
Kashi Dongfang Cangpin Culture Development Co.,
Ltd. (“Kashi Dongfang”) is a wholly-owned subsidiary of Nanjing Yanqing and its primary focus is to provide online and offline
warehouse management services for our e-commerce platform’s registered members.
Zhongcang Warehouse Co., Ltd. (“Zhongcang”)
is a joint venture by Kashi Longrui with third parties namely Zhonglianxin Industry Group (Hunan) Co., Ltd., Nanjing Zhonghao Culture
Media Limited, and Zhengjiang Culture Tourism International Cultural and Creative Industry Park Development Co., Ltd. to provide warehouse
services to our customers. Kashi Longrui owned 18% of Zhongcang.
We, through our subsidiaries in Hong Kong are
an online provider of collectibles and artwork e-commerce services, which allow collectors, artists and art dealers and owners to access
a much bigger market where they can engage with a wider range of collectibles or artwork investors than they could likely encounter without
our platforms. We currently facilitate trading by individual and institutional customers of all kinds of collectibles, artwork and certain
commodities on our leading online platforms owned by our subsidiaries in Hong Kong, namely the China International Assets and Equity of
Artworks Exchange Limited and HKDAEx Limited. We also provide online and offline integrated marketing, warehouse storage and technical
maintenance services to our customers through our VIE and its subsidiaries in China.
We are a holding company
incorporated in the Cayman Islands. Our securities offered in this prospectus are securities of our Cayman Islands holding company. As
a holding company with no material operations of our own, we conduct our business through our operating subsidiaries in Hong Kong and
our VIE and its subsidiaries in China. Neither we nor our subsidiaries own any shares in our VIE, Jiangsu Yanggu. Instead, we control
and receive the economic benefits of the business operations of Jiangsu Yanggu through a series of contractual arrangements (the “VIE
Agreements”). Investors of our securities of will not own any equity interests in our VIE, but instead own shares of a Cayman holding
company. Chinese regulatory authorities could disallow the VIE structure, which would likely result in a material change in our operations
and/or value of our shares, including that it could cause the value of shares to significantly decline or become worthless.
The VIE structure is subject to various risks.
For example, the contractual arrangements may not be as effective as direct ownership in providing us with control over Jiangsu Yanggu.
We expect to rely on the performance by the VIE shareholders of their respective obligations under the contracts to exercise control over
Jiangsu Yanggu. The VIE shareholders may not act in the best interests of our company or may not perform their obligations under these
contracts. Such risks will exist throughout the period in which we operate our business in China through the contractual arrangements.
If any dispute relating to these contracts remains unresolved, we will have to enforce our rights under these contracts through the operations
of PRC law and arbitration, litigation or other legal proceedings which could be a lengthy process and very costly.
Our VIE Jiangsu Yanggu and its subsidiaries are
incorporated and operating in mainland China and they have received all required permissions from Chinese authorities to operate its current
business in China. As our VIE and its subsidiaries provide marketing, warehouse storage and technical maintenance services in China, based
on the advice of our PRC counsel, we do not believe that we are a Critical Information Infrastructure Operator (“CIIO”) or
a Data Processing Operator (“DPO”) as defined in Cybersecurity Review Measures published by Cyberspace Administration of China,
National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, Ministry of
State Security, Ministry of Finance, Ministry of Commerce, People’s Bank of China, State Administration of Radio and Television,
China Securities Regulatory Commission, State Secrecy Administration and State Cryptography Administration on December 28, 2021 and will
take effect on February 15, 2022. As of the date of this prospectus, we (1) are not required to obtain permissions from any PRC authorities
to issue our Ordinary Shares or Preferred Shares to foreign investors, (2) are not subject to permission requirements from China Securities
Regulatory Commission (the “CSRC”), Cyberspace Administration of China (“CAC”) or any other authority that
is required to approve of our VIE’s operations, and (3) have not received or were denied such permissions by any PRC authorities.
Nevertheless, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council
jointly issued the “Opinions on Severely Cracking Down on Illegal Securities Activities According to Law,” or the Opinions,
which were made available to the public on July 6, 2021. The Opinions emphasized the need to strengthen the administration over illegal
securities activities, and the need to strengthen the supervision over overseas listings by Chinese companies. Given the current PRC regulatory
environment, it is uncertain when and whether we, our PRC subsidiary or VIE and it subsidiaries, will be required to obtain permission
from the PRC government to list on U.S. exchanges in the future, and even when such permission is obtained, whether it will be denied
or rescinded.
Our independent registered public accounting firm
that issues the audit report included in our annual report which is incorporated by reference in this prospectus, as an auditor of companies
that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to
which the PCAOB conducts regular inspections to assess its compliance with the applicable professional standards. Our auditor is headquartered
in New York City, and has been inspected by the PCAOB on a regular basis with the last inspection in 2020 and is not subject to the determinations
announced by the PCAOB on December 16, 2021. However, the recent developments would add uncertainties to our offering and we cannot assure
you whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness
of our auditor’s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources,
geographic reach, or experience as it relates to our audit. If it is later determined that the PCAOB is unable to inspect or investigate
completely our auditor because of a position taken by an authority in a foreign jurisdiction or any other reasons, the lack of inspection
could cause the trading in our securities to be prohibited under the Holding Foreign Companies Accountable Act, and as a result Nasdaq
may delist our securities. If our securities are unable to be listed on another securities exchange, such a delisting would substantially
impair your ability to sell or purchase our securities when you wish to do so, and the risk and uncertainty associated with a potential
delisting would have a negative impact on the price of our ordinary shares. Further, new laws and regulations or changes in laws and regulations
in both the United States and China could affect our ability to list and trade our ordinary shares on Nasdaq, which could materially impair
the market for and market price for our securities.
We provide customers of our online platform with
comprehensive services, including account opening, art investment education, market information, research, real-time customer support,
and artwork and collectibles warehousing services. Most services are delivered online through our proprietary client software and call
center. Our client software provides not only market information and analysis, but also interactive functions including live discussion
boards and instant messaging with customer service representatives, which we believe enhances our customers’ engagement.
We generate revenue from our services in connection
with the trading of artwork, collectibles and certain commodities on our platforms, primarily consisting of listing service fees, transaction
fees, marketing services fees and other revenues generated from traders (our customers).
Listing service fees
One-time nonrefundable listing service fees are
collected from traders for listing their products on the platform. Our only performance obligation is to provide the listing on our platform.
We recognized the related revenue upon the completion of our performance obligations which is when the customers’ products are successfully
listed on our websites. The fees are determined by contracts with the customers as a fixed percentage of the listing price. For listing
service contracts in which the related performance obligations can be completed within a short period of time, we recognize the related
revenue upon the completion of our performance obligations.
Transaction fee revenue
Transaction fee revenue is generally calculated
based on the transaction value of collectibles, artwork, commodities and points per transaction. Transaction value is the dollar amount
of the purchase and sale of the collectibles, artwork, commodities and points after they are listed on our platform. Our performance obligation
is to facilitate the trading transactions. The Company has a customer reward points program, pursuant to which reward points were issued
for opening a new account or referring customers to open accounts with us during our promotion period. In that regard, customers are required
to redeem certain reward points for new listings along with the regular listing services fees. If a customer does not own any reward points,
he/she can purchase them from other customers on our platform as the points can be traded by and among our customers on the platform and
we charge a transaction fee from the such points trading.
Transaction fee revenue is recognized and collected
at the time when the transaction is completed.
Transaction fee revenue also includes predetermined
monthly transaction fees for select traders with large transactions and are negotiated on a case by case basis. Predetermined transaction
fees are recognized and earned over the specified service period. Predetermined transaction fees received in advance of the specified
service period are recorded as deferred revenue.
Marketing service fees
Marketing service fee are usually collected after
we complete our services and includes the following type of services:
|
|
(1)
|
For certain marketing service agreements, we promise to assist our customer in connection with his/her listing and trading of his/her collectible/artwork or commodities on our platform, which mainly includes consultation and supporting services of the marketability for the collectible/artwork; assessing its market value and market acceptance for the collectible/artwork or commodities; and assisting in the application and legal protection required for the customer’s collectible/artwork or commodities to be approved for listing on our platform. For marketing service contracts in which the related performance obligations can be completed within a short period of time, we recognize the related revenue upon the completion of our performance obligations.
|
|
|
(2)
|
Marketing service agreements also includes providing promotional services for customers’ items as where to place ads on well-known cultural and art exchange websites in China, to provide online and offline marketing services including cooperation with auction houses and participate in industry-related exhibitions and fairs.
|
The marketing service fees are charged on various
fixed fee basis, which are based on the type of the listing session that the customer applies for and whether the customer has listed
and sold its collectible on other platforms before, and they were not tied to the type or value of the underlying collectible/artwork.
Marketing service contracts and fees are recognized upon the completion of all performance obligations.
Other
revenues
Other revenues primarily include other service
fees for IT technical support to customers and revenues from agency recommendation fee. IT technical support fees are negotiated on a
case by case basis and are recognized when the related services have been performed based on the specific terms of the contract. Agency
recommendation fees are mainly training and consulting services provided to certain qualified traders/agents. Upon completion of the training
and consultation, these qualified traders/agents may introduce our platform and services to potential customers to list their collectibles
and artwork with us for a fee or promote their own products on our platforms. Our performance obligation is completed and revenue is recognized
upon completion of training and related consulting services.
Set forth below is selected consolidating statements
of income and cash flows for the years ended December 31, 2020 and 2019 and selected balance sheet information as of December 31, 2020
and 2019 showing financial information for the Company (excluding the VIEs), the VIEs, eliminating entries and consolidated information.
ORIENTAL CULTURE HOLDING LTD AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS
FOR THE YEAR ENDED DEEMBER 31, 2020
|
|
|
Holding
|
|
Subsidiaries
|
|
VIE
|
|
Total
|
|
Elimiation
|
|
|
Consolidated
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
16,613,029
|
|
$
|
123,777
|
|
$
|
7,299,368
|
|
$
|
24,036,174
|
|
$
|
|
|
|
$
|
24,036,174
|
|
|
Short-term investment
|
|
|
|
|
|
|
|
|
1,056,286
|
|
|
1,056,286
|
|
|
|
|
|
|
1,056,286
|
|
|
Accounts receivable, net
|
|
|
|
|
|
|
|
|
402,428
|
|
|
402,428
|
|
|
|
|
|
|
402,428
|
|
|
Other receivables and prepaid expenses
|
|
|
|
|
|
10,688
|
|
|
188,827
|
|
|
199,515
|
|
|
|
|
|
|
199,515
|
|
|
Deposit
|
|
|
|
|
|
|
|
|
13,333,538
|
|
|
13,333,538
|
|
|
|
|
|
|
13,333,538
|
|
|
Other receivable - intercompany
|
|
|
|
|
|
|
|
|
256,948
|
|
|
256,948
|
|
|
(256,948
|
)(a)
|
|
|
|
|
|
Other receivable - VIE
|
|
|
|
|
|
20,500,877
|
|
|
|
|
|
20,500,877
|
|
|
(20,500,877
|
)(a)(b)
|
|
|
|
|
|
Total current assets
|
|
|
16,613,029
|
|
|
20,635,342
|
|
|
22,537,395
|
|
|
59,785,766
|
|
|
(20,757,825
|
)
|
|
|
39,027,941
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT, NET
|
|
|
|
|
|
8,540
|
|
|
363,675
|
|
|
372,215
|
|
|
|
|
|
|
372,215
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Escrow
|
|
|
600,000
|
|
|
|
|
|
|
|
|
600,000
|
|
|
|
|
|
|
600,000
|
|
|
Investment
|
|
|
|
|
|
|
|
|
535,617
|
|
|
535,617
|
|
|
|
|
|
|
535,617
|
|
|
Intangible assets, net
|
|
|
|
|
|
474,792
|
|
|
98,200
|
|
|
572,992
|
|
|
|
|
|
|
572,992
|
|
|
Investment in subsidiaries
|
|
|
20,761,600
|
|
|
|
|
|
|
|
|
20,761,600
|
|
|
(20,761,600
|
)(c)
|
|
|
|
|
|
Other receivable - intercompany
|
|
|
|
|
|
|
|
|
1,445,637
|
|
|
1,445,637
|
|
|
(1,445,637
|
)(a)
|
|
|
|
|
|
Total other assets
|
|
|
21,361,600
|
|
|
474,792
|
|
|
2,079,454
|
|
|
23,915,846
|
|
|
(22,207,237
|
)
|
|
|
1,708,609
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
37,974,629
|
|
$
|
21,118,674
|
|
$
|
24,980,524
|
|
$
|
84,073,827
|
|
$
|
(42,965,062
|
)
|
|
$
|
41,108,765
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
2,960,000
|
|
$
|
|
|
$
|
1,871,394
|
|
$
|
4,831,394
|
|
$
|
|
|
|
$
|
4,831,394
|
|
|
Accounts payable - related parties
|
|
|
|
|
|
|
|
|
1,229,381
|
|
|
1,229,381
|
|
|
|
|
|
|
1,229,381
|
|
|
Deferred revenue
|
|
|
|
|
|
|
|
|
243,355
|
|
|
243,355
|
|
|
|
|
|
|
243,355
|
|
|
Other payables and accrued liabilities
|
|
|
50,918
|
|
|
41,472
|
|
|
950,994
|
|
|
1,043,384
|
|
|
|
|
|
|
1,043,383
|
|
|
Other payables - related parties
|
|
|
|
|
|
7,312
|
|
|
-
|
|
|
7,312
|
|
|
|
|
|
|
7,312
|
|
|
Taxes payable
|
|
|
|
|
|
|
|
|
184,694
|
|
|
184,694
|
|
|
|
|
|
|
184,694
|
|
|
Other payable - intercompany
|
|
|
|
|
|
|
|
|
269,273
|
|
|
269,273
|
|
|
(269,273
|
)(a)
|
|
|
|
|
|
Other payable - VIE
|
|
|
1,394,465
|
|
|
251,487
|
|
|
|
|
|
1,645,952
|
|
|
(1,645,952
|
)(a)
|
|
|
|
|
|
Total current liabilities
|
|
|
4,405,383
|
|
|
300,271
|
|
|
4,749,091
|
|
|
9,454,745
|
|
|
(1,915,225
|
)
|
|
|
7,539,519
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
4,405,383
|
|
|
300,271
|
|
|
4,749,091
|
|
|
9,454,745
|
|
|
(1,915,225
|
)
|
|
|
7,539,519
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
|
|
|
18,886,014
|
|
|
1,495,505
|
|
|
113,299
|
|
|
20,494,818
|
|
|
(1,608,804
|
)(b)(c)
|
|
|
18,886,014
|
|
|
Statutory reserves
|
|
|
112,347
|
|
|
|
|
|
112,347
|
|
|
224,694
|
|
|
(112,347
|
)(b)
|
|
|
112,347
|
|
|
Retained earnings
|
|
|
13,647,770
|
|
|
18,079,201
|
|
|
19,021,604
|
|
|
50,748,575
|
|
|
(37,100,805
|
)(b)(c)
|
|
|
13,647,770
|
|
|
Accumulated other comprehensive income (loss)
|
|
|
923,115
|
|
|
1,243,697
|
|
|
984,183
|
|
|
3,150,995
|
|
|
(2,227,880
|
)(b)(c)
|
|
|
923,115
|
|
|
Total shareholders’ equity
|
|
|
33,569,246
|
|
|
20,818,403
|
|
|
20,231,433
|
|
|
74,619,082
|
|
|
(41,049,836
|
)
|
|
|
33,569,246
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders’ equity
|
|
$
|
37,974,629
|
|
$
|
21,118,674
|
|
$
|
24,980,524
|
|
$
|
84,073,827
|
|
$
|
(42,965,062
|
)
|
|
$
|
41,108,765
|
|
|
|
(a)
|
To eliminate intercompany balance as a result of the following:
|
|
Due from
|
|
Due to
|
|
Amount
|
|
|
Purpose
|
|
VIE
|
|
Subsidiaries
|
|
|
256,948
|
|
|
Amount owed for expenses paid for by VIE on behalf of subsidiaries
|
|
Subsidaries
|
|
VIE
|
|
|
269,273
|
|
|
Amount owed from subsidiaries for services provided by VIE
|
|
Holding
|
|
VIE
|
|
|
1,445,637
|
|
|
IPO expenses paid for by VIE
|
|
|
(b)
|
To eliminate receivable as result of contractual agreement from
VIE with VIE’s equity .
|
|
|
(c)
|
To eliminate Holding company’s investment with its
subsidiary’s equity.
|
ORIENTAL CULTURE HOLDING LTD AND SUBSIDIARIES
UNAUDITED CONDENDSED CONSOLIDATED STATEMENTS
OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 2020
|
|
|
Holding
|
|
|
Subsidiaries
|
|
|
VIE
|
|
|
Elimination
|
|
|
Total Subsidiaries
|
|
|
Elimination
|
|
|
Consolidated
|
|
|
Operating revenues
|
|
$
|
-
|
|
|
$
|
333,024
|
|
|
$
|
17,438,802
|
|
|
$
|
(333,024
|
)(a)
|
|
$
|
17,438,802
|
|
|
$
|
|
|
|
$
|
17,438,802
|
|
|
Cost of revenues
|
|
|
-
|
|
|
|
(261,908
|
)
|
|
|
(2,380,255
|
)
|
|
|
|
|
|
|
(2,642,163
|
)
|
|
|
|
|
|
|
(2,642,163
|
)
|
|
Gross profit
|
|
|
-
|
|
|
|
71,116
|
|
|
|
15,058,547
|
|
|
|
(333,024
|
)
|
|
|
14,796,639
|
|
|
|
-
|
|
|
|
14,796,639
|
|
|
Operating expenses
|
|
|
(4,452,154
|
)
|
|
|
(665,565
|
)
|
|
|
(8,383,307
|
)
|
|
|
350,475
|
|
|
|
(8,698,397
|
)
|
|
|
|
|
|
|
(13,150,551
|
)
|
|
Income from operations
|
|
|
(4,452,154
|
)
|
|
|
(594,449
|
)
|
|
|
6,675,240
|
|
|
|
17,451
|
|
|
|
6,098,242
|
|
|
|
-
|
|
|
|
1,646,088
|
|
|
Other income(expense)
|
|
|
(17,410
|
)
|
|
|
146,070
|
|
|
|
273,359
|
|
|
|
|
|
|
|
419,429
|
|
|
|
|
|
|
|
402,019
|
|
|
Provision fro income tax
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Income from VIE
|
|
|
-
|
|
|
|
6,948,599
|
|
|
|
-
|
|
|
|
(6,948,599
|
)(b)
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
Income from subsidiaries
|
|
|
6,517,671
|
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
(6,517,671
|
)(c)
|
|
|
-
|
|
|
Net income
|
|
$
|
2,048,107
|
|
|
$
|
6,500,220
|
|
|
$
|
6,948,599
|
|
|
$
|
(6,931,148
|
)
|
|
$
|
6,517,671
|
|
|
$
|
(6,517,671
|
)
|
|
$
|
2,048,107
|
|
|
|
(a)
|
to eliminate intercompany revenue and expenses for services
provided by the Company’s subsidiairy to its VIE.
|
|
|
(b)
|
to eliminate VIE income by WFOE
|
|
|
(c)
|
to eliminate subsidiary income from Holding
|
ORIENTAL CULTURE HOLDING LTD AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2020
|
|
|
Holding
|
|
|
Subsidiaries
|
|
|
VIE
|
|
|
Total
|
|
|
Elimination
|
|
|
Consolidated
|
|
|
Net cash provided by (used in) operating activities
|
|
$
|
(1,477,639
|
)
|
|
$
|
(408,115
|
)
|
|
$
|
9,987,341
|
|
|
$
|
8,101,587
|
|
|
$
|
|
|
|
$
|
8,101,587
|
|
|
Net cash provided by (used in )investing activities
|
|
|
|
|
|
|
(9,388
|
)
|
|
|
(11,759,906
|
)
|
|
|
(11,769,294
|
)
|
|
|
|
|
|
|
(11,769,294
|
)
|
|
Net cash provided by (used in) financing activities
|
|
|
18,090,668
|
|
|
|
(54,273
|
)
|
|
|
|
|
|
|
18,036,395
|
|
|
|
|
|
|
|
18,036,395
|
|
|
Effect of exchange rate
|
|
|
|
|
|
|
2,598
|
|
|
|
480,217
|
|
|
|
482,815
|
|
|
|
|
|
|
|
482,815
|
|
|
Net increase in cash and cash equivalents
|
|
|
16,613,029
|
|
|
|
(469,178
|
)
|
|
|
(1,292,348
|
)
|
|
|
14,851,503
|
|
|
|
|
|
|
|
14,851,503
|
|
|
CASH AND CASH EQUIVELENTS, beginning of year
|
|
|
-
|
|
|
|
592,955
|
|
|
|
8,591,716
|
|
|
|
9,184,671
|
|
|
|
|
|
|
|
9,184,671
|
|
|
CASH AND CASH EQUIVELENTS, end of year
|
|
$
|
16,613,029
|
|
|
$
|
123,777
|
|
|
$
|
7,299,368
|
|
|
$
|
24,036,174
|
|
|
$
|
|
|
|
$
|
24,036,174
|
|
ORIENTAL CULTURE HOLDING LTD AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS
FOR THE YEAR ENDED DECEMBER 31, 2019
|
|
|
Holding
|
|
|
Subsidiaries
|
|
|
VIE
|
|
Total
|
|
|
Elimination
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
|
|
|
$
|
592,955
|
|
|
$
|
8,591,716
|
|
$
|
9,184,671
|
|
|
$
|
|
|
|
$
|
9,184,671
|
|
|
Short-term investment
|
|
|
|
|
|
|
|
|
|
|
1,749,092
|
|
|
1,749,092
|
|
|
|
|
|
|
|
1,749,092
|
|
|
Accounts receivable, net
|
|
|
|
|
|
|
|
|
|
|
1,263,224
|
|
|
1,263,224
|
|
|
|
|
|
|
|
1,263,224
|
|
|
Other receivables and prepaid expenses
|
|
|
|
|
|
|
24,676
|
|
|
|
8,266
|
|
|
32,942
|
|
|
|
|
|
|
|
32,942
|
|
|
Other receivable - intercompany
|
|
|
|
|
|
|
|
|
|
|
182,201
|
|
|
182,201
|
|
|
|
(182,201
|
)(a)
|
|
|
|
|
|
Other receivable - VIE
|
|
|
|
|
|
|
12,090,838
|
|
|
|
|
|
|
12,090,838
|
|
|
|
(12,090,838
|
)(a)(b)
|
|
|
|
|
|
Total current assets
|
|
|
|
|
|
|
12,708,469
|
|
|
|
11,794,499
|
|
|
24,502,968
|
|
|
|
(12,273,039
|
)
|
|
|
12,229,929
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT, NET
|
|
|
|
|
|
|
14,236
|
|
|
|
446,633
|
|
|
460,869
|
|
|
|
|
|
|
|
460,869
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
|
|
|
|
|
|
|
|
|
|
|
500,967
|
|
|
500,967
|
|
|
|
|
|
|
|
500,967
|
|
|
Intangible assets, net
|
|
|
|
|
|
|
631,467
|
|
|
|
108,326
|
|
|
739,793
|
|
|
|
|
|
|
|
739,793
|
|
|
Deferred offering costs
|
|
|
|
|
|
|
|
|
|
|
782,029
|
|
|
782,029
|
|
|
|
|
|
|
|
782,029
|
|
|
Investment in subsidiairies
|
|
|
13,099,272
|
|
|
|
|
|
|
|
|
|
|
13,099,272
|
|
|
|
(13,099,272
|
)(c)
|
|
|
|
|
|
Total other assets
|
|
|
13,099,272
|
|
|
|
631,467
|
|
|
|
1,391,322
|
|
|
15,122,061
|
|
|
|
(13,099,272
|
)
|
|
|
2,022,789
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
13,099,272
|
|
|
$
|
13,354,172
|
|
|
$
|
13,632,454
|
|
$
|
40,085,898
|
|
|
$
|
(25,372,311
|
)
|
|
$
|
14,713,587
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
|
|
|
$
|
|
|
|
$
|
333,505
|
|
$
|
333,505
|
|
|
$
|
|
|
|
$
|
333,505
|
|
|
Accounts payable - related parties
|
|
|
|
|
|
|
|
|
|
|
207,766
|
|
|
207,766
|
|
|
|
|
|
|
|
207,766
|
|
|
Deferred revenue
|
|
|
|
|
|
|
|
|
|
|
176,457
|
|
|
176,457
|
|
|
|
|
|
|
|
176,457
|
|
|
Other payables and accrued liabilities
|
|
|
|
|
|
|
11,570
|
|
|
|
684,236
|
|
|
695,806
|
|
|
|
|
|
|
|
695,806
|
|
|
Other payables - related parties
|
|
|
|
|
|
|
61,318
|
|
|
|
-
|
|
|
61,318
|
|
|
|
|
|
|
|
61,318
|
|
|
Taxes payable
|
|
|
|
|
|
|
|
|
|
|
139,463
|
|
|
139,463
|
|
|
|
|
|
|
|
139,463
|
|
|
Other payable - intercompany
|
|
|
|
|
|
|
|
|
|
|
38,703
|
|
|
38,703
|
|
|
|
(38,703
|
)(a)
|
|
|
|
|
|
Other payable - VIE
|
|
|
|
|
|
|
198,249
|
|
|
|
|
|
|
198,249
|
|
|
|
(198,249
|
)(a)
|
|
|
|
|
|
Total current liabilities
|
|
|
|
|
|
|
271,137
|
|
|
|
1,580,130
|
|
|
1,851,267
|
|
|
|
(236,952
|
)
|
|
|
1,614,315
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
|
|
|
|
271,137
|
|
|
|
1,580,130
|
|
|
1,851,267
|
|
|
|
(236,952
|
)
|
|
|
1,614,315
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional paid-in capital
|
|
|
1,608,804
|
|
|
|
1,495,505
|
|
|
|
113,299
|
|
|
3,217,608
|
|
|
|
(1,608,804
|
)(b)(c)
|
|
|
1,608,804
|
|
|
Statutory reserves
|
|
|
112,347
|
|
|
|
-
|
|
|
|
112,347
|
|
|
224,694
|
|
|
|
(112,347
|
)(b)
|
|
|
112,347
|
|
|
Retained earnings
|
|
|
11,599,663
|
|
|
|
11,578,982
|
|
|
|
12,073,005
|
|
|
35,251,650
|
|
|
|
(23,651,987
|
)(b)(c)
|
|
|
11,599,663
|
|
|
Accumulated other comprehensive income (loss)
|
|
|
(221,542
|
)
|
|
|
8,548
|
|
|
|
(246,327
|
)
|
|
(459,321
|
)
|
|
|
237,779
|
(b)(c)
|
|
|
(221,542
|
)
|
|
Total shareholders’ equity
|
|
|
13,099,272
|
|
|
|
13,083,035
|
|
|
|
12,052,324
|
|
|
38,234,631
|
|
|
|
(25,135,359
|
)
|
|
|
13,099,272
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders’ equity
|
|
$
|
13,099,272
|
|
|
$
|
13,354,172
|
|
|
$
|
13,632,454
|
|
$
|
40,085,898
|
|
|
$
|
(25,372,311
|
)
|
|
$
|
14,713,587
|
|
|
|
(a)
|
To eliminate intercompany balance of $182,801 for expenses paid
for by VIE on behalf of subsidiaries and $38,703 receivable due from VIE to subsidiaries.
|
|
|
(b)
|
To eliminate receivable as result of contractual agreement from VIE with VIE’s equity.
|
|
|
(c)
|
To eliminate Holding company’s investment with its subsidiary’s
equity.
|
ORIENTAL CULTURE HOLDING LTD AND SUBSIDIARIES
UNAUDITED CONDENDSED CONSOLIDATED STATEMENTS
OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 2019
|
|
|
Holding
|
|
|
Subsidiaries
|
|
|
VIE
|
|
|
Total
|
|
|
Elimination
|
|
|
Consolidated
|
|
|
Operating revenues
|
|
$
|
-
|
|
|
$
|
57,421
|
|
|
$
|
13,449,448
|
|
|
$
|
13,506,869
|
|
|
$
|
(57,434
|
)(a)
|
|
$
|
13,449,435
|
|
|
Cost of revenues
|
|
|
-
|
|
|
|
(50,507
|
)
|
|
|
(1,279,370
|
)
|
|
|
(1,329,877
|
)
|
|
|
|
|
|
|
(1,329,877
|
)
|
|
Gross profit
|
|
|
-
|
|
|
|
6,914
|
|
|
|
12,170,078
|
|
|
|
12,176,992
|
|
|
|
(57,434
|
)
|
|
|
12,119,558
|
|
|
Operating expenses
|
|
|
|
|
|
|
(405,713
|
)
|
|
|
(2,792,186
|
)
|
|
|
(3,197,899
|
)
|
|
|
57,434
|
(a)
|
|
|
(3,140,465
|
)
|
|
Income from operations
|
|
|
|
|
|
|
(398,799
|
)
|
|
|
9,377,892
|
|
|
|
8,979,093
|
|
|
|
-
|
|
|
|
8,979,093
|
|
|
Other income(expense)
|
|
|
|
|
|
|
(4,256
|
)
|
|
|
113,035
|
|
|
|
108,779
|
|
|
|
|
|
|
|
108,779
|
|
|
Provision fro income tax
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Income from VIE
|
|
|
-
|
|
|
|
9,490,927
|
|
|
|
-
|
|
|
|
9,490,927
|
|
|
|
(9,490,927
|
)(b)
|
|
|
-
|
|
|
Income from subsidiaries
|
|
|
9,087,872
|
|
|
|
|
|
|
|
-
|
|
|
|
9,087,872
|
|
|
|
(9,087,872
|
)(c)
|
|
|
-
|
|
|
Net income
|
|
$
|
9,087,872
|
|
|
$
|
9,087,872
|
|
|
$
|
9,490,927
|
|
|
$
|
27,666,671
|
|
|
$
|
(18,578,799
|
)
|
|
$
|
9,087,872
|
|
|
|
(a)
|
to eliminate intercompany revenue and expenses for services provided by the Company’s subsidiaries to its VIE.
|
|
|
(b)
|
to eliminate VIE income by WFOE
|
|
|
(c)
|
to eliminate subsidiary income from Holding
|
ORIENTAL CULTURE HOLDING LTD AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2019
|
|
|
Holding
|
|
|
Subsidiaries
|
|
|
VIE
|
|
|
Total
|
|
|
Elimination
|
|
|
Consolidated
|
|
|
Net cash provided by (used in) operating activities
|
|
$
|
|
|
|
$
|
(36,505
|
)
|
|
$
|
9,595,972
|
|
|
$
|
9,559,467
|
|
|
$
|
|
|
|
$
|
9,559,467
|
|
|
Net cash provided by (used in )investing activities
|
|
|
|
|
|
|
657,984
|
|
|
|
(2,096,744
|
)
|
|
|
(1,438,760
|
)
|
|
|
|
|
|
|
(1,438,760
|
)
|
|
Net cash provided by (used in) financing activities
|
|
|
|
|
|
|
(31,828
|
)
|
|
|
(821,751
|
)
|
|
|
(853,579
|
)
|
|
|
|
|
|
|
(853,579
|
)
|
|
Effect of exchange rate
|
|
|
|
|
|
|
3,304
|
|
|
|
(102,619
|
)
|
|
|
(99,315
|
)
|
|
|
|
|
|
|
(99,315
|
)
|
|
Net increase in cash and cash equivalents
|
|
|
|
|
|
|
592,955
|
|
|
|
6,574,858
|
|
|
|
7,167,813
|
|
|
|
|
|
|
|
7,167,813
|
|
|
CASH AND CASH EQUIVELENTS, beginning of year
|
|
|
|
|
|
|
-
|
|
|
|
2,016,858
|
|
|
|
2,016,858
|
|
|
|
|
|
|
|
2,016,858
|
|
|
CASH AND CASH EQUIVELENTS, end of year
|
|
$
|
|
|
|
$
|
592,955
|
|
|
$
|
8,591,716
|
|
|
$
|
9,184,671
|
|
|
$
|
|
|
|
$
|
9,184,671
|
|
Dividend Distribution
We are an online provider of collectibles and
artwork e-commerce services and we facilitate trading by individual and institutional customers of all kinds of collectibles, artworks
and certain commodities on our leading online platforms owned by our subsidiaries in Hong Kong, namely the China International Assets
and Equity of Artworks Exchange Limited and HKDAEx Limited. We also provide online and offline integrated marketing, warehouse storage
and technical maintenance services to our customers through our VIE and its subsidiaries in China.
Our PRC operating entity receives their revenue
in RMB. Under our current corporate structure, to fund any cash and financing requirements we may have, the Company may rely on certain
dividend payments from our subsidiaries in Hong Kong and WFOE in China. Our WFOE receives payments from Jiangsu Yanggu, pursuant to the
VIE Agreements. WFOE may make distribution of such payments to Oriental Culture HK as dividends.
Under existing PRC foreign exchange regulations,
payments of current account items, such as profit distributions and trade and service-related foreign exchange transactions, can be made
in foreign currencies without prior approval from State Administration of Foreign Exchange or SAFE by complying with certain procedural
requirements. Therefore, our PRC subsidiary, WFOE is able to pay dividends in foreign currencies to us without prior approval from SAFE,
subject to the condition that the remittance of such dividends outside of the PRC complies with certain procedures under PRC foreign exchange
regulations, such as the overseas investment registrations by the shareholders of the Company who are PRC residents. Approval from or
registration with appropriate government authorities is, however, required where the RMB is to be converted into foreign currency and
remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. The PRC government may
also at its discretion restrict access in the future to foreign currencies for current account transactions.
Current PRC regulations permit our WFOE to pay
dividends to the Company only out of its accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations.
In addition, our subsidiary in China is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory
reserve until such reserve reaches 50% of its registered capital. Each such entity in China is also required to further set aside a portion
of its after-tax profits to fund the employee welfare fund, although the amount to be set aside, if any, is determined at the discretion
of its board of directors. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate
future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except
in the event of liquidation.
As of the date of this prospectus, Neither WFOE
or any of our subsidiaries in Hong Kong has not made any dividends or distributions to the Company, the Company has not made any dividends
or distribution to the holding company, and no dividends or distributions have been made by the Company. We intend to keep any future
earnings to re-invest in and finance the expansion of our business, and we do not anticipate that any cash dividends will be paid in the
foreseeable future. Under the Cayman Islands law, a Cayman Islands company may pay a dividend on its shares out of either profit or share
premium amount, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts
due in the ordinary course of business.
Impact of COVID-19
Beginning in late 2019, there were reports of the COVID-19 (coronavirus) that has surfaced, the pandemic quickly spread to many provinces, autonomous regions, and cities all over the China and Hong Kong. To the prevention and control of the spread of the pandemic, the Chinese governments issued administrative orders to impose travel and public gathering restrictions as well as to work from home and self-quarantine. The Company primarily conducts its business operations in Hong Kong and China. In response to the evolving dynamics related to the COVID-19 outbreak, the Company has followed the guidelines of local government authorities as it prioritizes the health and safety of its employees, clients, contractors, suppliers and business partners. Our business, financial condition, and results of operations were adversely affected by the outbreak of COVID-19 when we closed our warehouse for collectibles and artwork traded on our platform as required by relevant Chinese government authorities during COVID-19 outbreak, the appraisals for certain collectibles and artwork were delayed from the beginning of February to mid-March 2020, resulting in delays of the subsequent listing process of such collectibles and artworks, thus affected us providing marketing services for potential new products and our ability to generate marketing service fees during the first half of 2020. Also, our customers required additional time to pay us or failed to pay us which required us to record additional allowances during the fist half of 2020.
Starting in July 2020, our business has recovered
as individuals and entities resumed their business activities which were delayed or postponed due to the COVID-19 outbreak. However, the
results of operations are still uncertain and may be adversely impacted by any further outbreak or resurgence of the COVID-19 and new
variants. Potential impact to our results of operations will also depend on future developments and new information that may emerge regarding
COVID-19 and the actions taken by governmental authorities and other entities to contain COVID-19 and/or mitigate its impact, almost all
of which are beyond our control. Due to the significant uncertainties surrounding any further outbreak or resurgence of COVID-19 and actions
that might be taken by governmental authorities, the extent of the future business disruption and the related financial impacts on our
business cannot be reasonably estimated at this time
Our Organizational Structure
The Company’s organizational chart
as of the date of this registration statement is as follows:
Corporate Information
Our principal executive office
is located on the Room 1402, Richmake Commercial Building, 198-200 Queen’s Road Central, Hong Kong. Our telephone number is +852-21103909.
We maintain a website at www.ocgroup.hk that contains information about our Company, though no information contained on our website is
part of this prospectus.
Transfer Agent and Registrar
The transfer agent and registrar for our Ordinary
Shares is VStock Transfer, LLC at 18 Lafayette Place, Woodmere, New York 11598.
NASDAQ Capital Market Listing
Our Ordinary Shares are listed on the NASDAQ Capital
Market under the symbol “OCG”
The Offering
|
Issuer
|
Oriental Culture Holding LTD.
|
|
|
|
|
Securities We May Offer
|
We may offer up to $200,000,000 in aggregate amount of our ordinary shares and preferred shares, warrants, rights, either individually or in units.
|
|
|
|
|
Use of Proceeds
|
We will use the net proceeds from the sale of our securities for general corporate purposes.
|
|
|
|
|
Risk Factors
|
See “Risk Factors” on page 11 and other information we include or incorporate by reference in this prospectus for a discussion of factors you should carefully consider before deciding to invest in our ordinary shares.
|
|
|
|
|
NASDAQ Market Symbol
|
OCG
|
RISK FACTORS
Investing in our securities involves a high degree
of risk. You should carefully consider the risk factors set forth under “Risk Factors” described in our most recent annual
report on Form 20-F, filed on April 30, 2021, as supplemented and updated by subsequent current reports on Form 6-K that we have
filed with the SEC, together with all other information contained or incorporated by reference in this prospectus and any applicable prospectus
supplement and in any related free writing prospectus in connection with a specific offering, before making an investment decision. Each
of the risk factors could materially and adversely affect our business, operating results, financial condition and prospects, as well
as the value of an investment in our securities, and the occurrence of any of these risks might cause you to lose all or part of your
investment.
If the Chinese government determines that
the contractual arrangements through which we control our VIE do not comply with applicable regulations, our business could be adversely
affected.
There are uncertainties regarding the interpretation
and application of PRC laws, rules and regulations, including but not limited to the laws, rules and regulations governing the validity
and enforcement of the contractual arrangements with Jiangsu Yanggu and its shareholders. Although we have been advised by our PRC counsel
that based on their understanding of the current PRC laws, rules and regulations, the contractual arrangements, as well our ability to
enforce our rights thereunder, comply with all applicable PRC laws, rules and regulations, and do not violate, breach, contravene or otherwise
conflict with any applicable PRC laws, rules or regulations, we cannot assure you that the PRC regulatory authorities will not determine
that our corporate structure and contractual arrangements violate PRC laws, rules or regulations. If the PRC regulatory authorities determine
that our contractual arrangements are in violation of applicable PRC laws, rules or regulations, they will become invalid or unenforceable.
In addition, new PRC laws, rules and regulations may be introduced from time to time to impose additional requirements that may be applicable
to our contractual arrangements.
The Chinese government has broad discretion in
dealing with violations of laws and regulations, including levying fines, revoking business and other licenses and requiring actions necessary
for compliance. In particular, licenses and permits issued or granted to us by relevant governmental bodies may be revoked at a later
time by higher regulatory bodies. We cannot predict the effect of the interpretation of existing or new Chinese laws or regulations on
our businesses. We cannot assure you that our current ownership and operating structure would not be found in violation of any current
or future Chinese laws or regulations. As a result, we may be subject to sanctions, including fines, and could be required to restructure
our operations or cease to provide certain services. Any of these or similar actions could significantly disrupt our business operations
or restrict us from conducting a substantial portion of our business operations, which could materially and adversely affect our business,
financial condition and results of operations.
We conduct our operations in China through our
VIE Jiangsu Yanggu, which entered into a series of contractual arrangements by and among WFOE, our VIE and its shareholders. These contractual
agreements enable us to (i) exercise effective control over our VIE, (ii) receive substantially all of the economic benefits of our VIE,
and (iii) have an exclusive call option to purchase all or part of the equity and asset interests in our VIE when and to the extent permitted
by PRC law. As a result of these contractual arrangements, we exert control over our VIE and consolidate financial results of our VIE
in our financial statements under U.S. GAAP.
In the opinion of our PRC legal counsel, (i) the
ownership structures of our VIE and WFOE in China are not in violation of mandatory provisions of applicable PRC laws and regulations
currently in effect; and (ii) the agreements under the contractual arrangements among WFOE, our VIE and its shareholders governed by PRC
law are valid and binding upon each party to such agreements and enforceable against each party thereto in accordance with their terms
and applicable PRC laws and regulations currently in effect. However, we have been further advised by our PRC legal counsel that there
are substantial uncertainties regarding the interpretation and application of current or future PRC laws and regulations. If we or our
VIE are determined to be in violation of any existing or future PRC laws, rules or regulations or fail to obtain or maintain any of the
required governmental permits or approvals, the relevant PRC regulatory authorities would have broad discretion in dealing with such violations,
including:
|
|
●
|
revoking the business and operating licenses of Jiangsu Yanggu and/or voiding the contractual arrangements;
|
|
|
|
|
|
|
●
|
discontinuing or restricting the operations of Jiangsu Yanggu and its subsidiaries;
|
|
|
●
|
imposing conditions or requirements with which we or Jiangsu Yanggu may not be able to comply;
|
|
|
|
|
|
|
●
|
requiring us to restructure the relevant ownership structure or operations;
|
|
|
|
|
|
|
●
|
restricting or prohibiting our use of the proceeds from our offering to finance our business and operations in China; or
|
|
|
|
|
|
|
●
|
imposing fines or other forms of economic penalties.
|
As we do not have direct ownership of Jiangsu
Yanggu, the imposition of any of these penalties may have a material adverse effect on our financial condition, results of operations
and prospects. If occurrences of any of these events result in our inability to direct the activities of our VIE and its subsidiaries
in China, and/or our failure to receive the economic benefits and residual returns from our consolidated variable interest entity, and
we are not able to restructure our ownership structure and operations in a satisfactory manner, we may not be able to consolidate the
financial results of our VIE in our consolidated financial statements in accordance with U.S. GAAP.
Our contractual arrangements with our VIE
may not be as effective in providing operational control as direct ownership.
We have relied and expect to continue to rely
on contractual arrangements with Jiangsu Yanggu and its shareholders to operate our business. These contractual arrangements may not be
as effective in providing us with control over these affiliated entities as direct ownership. If we had direct ownership of these entities,
we would be able to exercise our rights as a shareholder to effect changes in the board of directors, which in turn could effect changes,
subject to any applicable fiduciary obligations, at the management level. However, under the current contractual arrangements, we rely
on the performance by these entities and their shareholders of their contractual obligations to exercise control over our VIE. Therefore,
our contractual arrangements with our VIE may not be as effective in ensuring our control over our China operations as direct ownership
would be.
Uncertainties and quick change in the PRC
legal system with little advance notice could result in a material and negative impact our business operations, decrease the value of
our Ordinary Shares and limit the legal protections available to you and us.
The PRC legal system is a civil law system based
on written statutes. Unlike the common law system, prior court decisions under the civil law system may be cited for reference but have
limited precedential value.
In 1979, the PRC government
began to promulgate a comprehensive system of laws and regulations governing economic matters in general. The overall effect of legislation
over the past four decades has significantly enhanced the protections afforded to various forms of foreign investments in China. However,
China has not developed a fully integrated legal system, and recently enacted laws and regulations may not sufficiently cover all aspects
of economic activities in China. In particular, the interpretation and enforcement of these laws and regulations involve uncertainties.
Since PRC administrative and court authorities have significant discretion in interpreting and implementing statutory provisions and contractual
terms, it may be difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection we enjoy.
These uncertainties may affect our judgment on the relevance of legal requirements and our ability to enforce our contractual rights or
tort claims. In addition, the regulatory uncertainties may be exploited through unmerited or frivolous legal actions or threats in attempts
to extract payments or benefits from us.
From time to time, we
may have to resort to administrative and court proceedings to enforce our legal rights. However, since PRC administrative and court authorities
have significant discretion in interpreting and implementing statutory and contractual terms, it may be more difficult to evaluate the
outcome of administrative and court proceedings and the level of protection we enjoy than in more developed legal systems. Furthermore,
the PRC legal system is based in part on government policies and internal rules, some of which are not published on a timely basis or
at all, and which may have a retroactive effect. As a result, we may not be aware of our violation of any of these policies and rules
until sometime after the violation. In addition, any administrative and court proceedings in China may be protracted, resulting in substantial
costs and diversion of resources and management attention.
Such uncertainties, including
uncertainty over the scope and effect of our contractual, property (including intellectual property) and procedural rights, and any failure
to respond to changes in the regulatory environment in China could materially and adversely affect our business and impede our ability
to continue our operations.
Litigation and
negative publicity surrounding China-based companies listed in the U.S. may result in increased regulatory scrutiny of us and negatively
impact the trading price of our Ordinary Shares and could have a material adverse effect upon our business, including our results of operations,
financial condition, cash flows and prospects.
We believe that litigation
and negative publicity surrounding companies with operations in China that are listed in the U.S. have negatively impacted stock prices
for such companies. Various equity-based research organizations have published reports on China-based companies after examining, among
other things, their corporate governance practices, related party transactions, sales practices and financial statements that have led
to special investigations and stock suspensions on national exchanges. Any similar scrutiny of us, regardless of its lack of merit, could
result in a diversion of management resources and energy, potential costs to defend ourselves against rumors, decreases and volatility
in the trading price of our Ordinary Shares, and increased directors and officers insurance premiums and could have a material adverse
effect upon our business, including our results of operations, financial condition, cash flows and prospects.
The Chinese government exerts substantial
influence over the manner in which we must conduct our business, and may intervene or influence our operations at any time, which could
result in a material change in our operations, significantly limit or completely hinder our ability to offer or continue to offer securities
to investors and, and cause the value of our Ordinary Shares to significantly decline or be worthless.
The Chinese government has exercised and continues
to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability
to operate in China may be harmed by changes in its laws and regulations, including those relating to taxation, environmental regulations,
land use rights, property and other matters. The central or local governments of these jurisdictions may impose new, stricter regulations
or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our compliance
with such regulations or interpretations. Accordingly, government actions in the future, including any decision not to continue to support
recent economic reforms and to return to a more centrally planned economy or regional or local variations in the implementation of economic
policies, could have a significant effect on economic conditions in China or particular regions thereof, and could require us to divest
ourselves of any interest we then hold in Chinese properties.
As such, our business in China is subject to various
government and regulatory interferences. We could be subject to regulation by various political and regulatory entities, including various
local and municipal agencies and government sub-divisions. The Company may incur increased costs necessary to comply with existing and
newly adopted laws and regulations or penalties for any failure to comply. Our operations could be adversely affected, directly or indirectly,
by existing or future laws and regulations relating to its business or industry, which could result in a material change in our operation
and the value of our Ordinary Shares.
Furthermore, given recent statements by
the Chinese government indicating an intent to exert more oversight and control over offerings that are conducted overseas, although we
are currently not required to obtain permission from any of the PRC federal or local government and has not received any denial to list
on the U.S. exchange, it is uncertain when and whether we will be required to obtain permission from the PRC government to list and trade
on U.S. exchanges in the future, and even when such permission is obtained, whether it will be denied or rescinded, which could significantly
limit or completely hinder our ability to offer or continue to offer our securities to investors and cause the value of our shares to
significantly decline or be worthless.
Our Ordinary Shares may be delisted under
the Holding Foreign Companies Accountable Act if the Public Company Accounting Oversight Board (the “PCAOB”), is unable to
inspect our auditors due to a position taken by one or more authorities in the foreign jurisdiction. The delisting of our Ordinary Shares,
or the threat of their being delisted, may materially and adversely affect the value of your investment. Additionally, the inability of
the PCAOB to conduct inspections deprives our investors with the benefits of such inspections.
On April 21, 2020, then SEC Chairman Jay
Clayton and PCAOB Chairman William D. Duhnke III, along with other senior SEC staff, released a joint statement highlighting the risks
associated with investing in companies based in or have substantial operations in emerging markets including China. The joint statement
emphasized the risks associated with lack of access for the PCAOB to inspect auditors and audit work papers in China and higher risks
of fraud in emerging markets.
On May 18, 2020, Nasdaq filed three proposals
with the SEC to (i) apply minimum offering size requirement for companies primarily operating in a “Restrictive Market,”
(ii) adopt a new requirement relating to the qualification of management or board of directors for Restrictive Market companies,
and (iii) apply additional and more stringent criteria to an applicant or listed company based on the qualifications of the company’s
auditor.
On June 4, 2020, the U.S. President issued
a memorandum ordering the President’s working group on financial markets to submit a report to the President within 60 days of the
date of the memorandum that should include recommendations for actions that can be taken by the executive branch and by the SEC or PCAOB
to enforce U.S. regulatory requirements on Chinese companies listed on U.S. stock exchanges and their audit firms.
On August 10, 2020, the SEC announced that
the SEC Chairman had directed the SEC staff to prepare proposals in response to the report of the President’s working group, and
that the SEC was soliciting public comments and information with respect to the development of these proposals.
On May 20, 2020, the U.S. Senate passed S.
945, the Holding Foreign Companies Accountable Act, or the Act. The Act was approved by the U.S. House of Representatives on December 2,
2020. On December 18, 2020, the Act was signed into public law by the President of the United States. In essence, the Act requires
the SEC to prohibit foreign companies from listing securities on U.S. securities exchanges if a company retains a foreign accounting firm
that cannot be inspected by the PCAOB for three consecutive years, beginning in 2021. On March 24, 2021, SEC announced it has adopted
interim final amendments to implement congressionally mandated submission and disclosure requirements of the Act. The interim final
amendments will apply to registrants that the SEC identifies as having filed an annual report on Forms 10-K, 20-F, 40-F or N-CSR with
an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that the PCAOB has determined
it is unable to inspect or investigate completely because of a position taken by an authority in that jurisdiction. On December 2, 2021,
SEC adopted amendments to finalize rules implementing the submission and disclosure requirements in the Act. The rules apply to registrants
the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located
in a foreign jurisdiction and that the PCAOB is unable to inspect or investigate (the “Commission-Identified
Issuers”). A Commission-Identified Issuer will be required to comply
with the submission and disclosure requirements in the annual report for each year in which it was identified. If a registrant is identified
as a Commission-Identified Issuer based on its annual report for the fiscal year ended December 31, 2021, the registrant will be required
to comply with the submission or disclosure requirements in its annual report filing covering the fiscal year ended December 31, 2022.
Under the Act, our Ordinary
Shares may be prohibited from trading on the Nasdaq or other U.S. stock exchanges if our auditor is not inspected by the PCAOB for three
consecutive years, and this ultimately could result in our Ordinary Shares being delisted. Furthermore, on June 22, 2021, the U.S. Senate
passed the Accelerating Holding Foreign Companies Accountable Act, which, if enacted, would amend the Act and require the SEC to prohibit
an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive
years instead of three, thus reducing the time period before our securities may be prohibited from trading or delisted if our auditor
is unable to meet the PCAOB inspection requirement. On September 22, 2021, the PCAOB adopted a final rule implementing the Act, which
provides a framework for the PCAOB to use when determining, as contemplated under the Act, whether the PCAOB is unable to inspect or investigate
completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities
in that jurisdiction. On December 16, 2021, the PCAOB issued a report on its determinations that it is unable to inspect or
investigate completely PCAOB-registered public accounting firms headquartered in mainland China and in Hong Kong, a Special Administrative
Region of the People’s Republic of China (PRC), because of positions taken by PRC authorities in those jurisdictions, however, our
auditor is not subject to such determination as it is headquartered in New York and has been inspected by PCAOB on a regular basis.
The enactment of the
Act and any additional actions, proceedings, or new rules resulting from these efforts to increase U.S. regulatory access to audit
information could cause investors uncertainty for affected issuers and the market price of our Ordinary Shares could be adversely affected,
and we could be delisted if we and our auditor are unable to meet the PCAOB inspection requirement.
The lack of access to PCAOB inspections in China
prevents the PCAOB from fully evaluating audits and quality control procedures of the auditors based in China. As a result, investors
may be deprived of the benefits of such PCAOB inspections. The inability of the PCAOB to conduct inspections of auditors in China makes
it more difficult to evaluate the effectiveness of these accounting firm’s audit procedures or quality control procedures as compared
to auditors outside of China that are subject to the PCAOB inspections.
We are a company headquartered in Hong Kong. Our
independent registered public accounting firm that issues the audit report, as an auditor of companies that are traded publicly in the
United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB conducts regular
inspections to assess its compliance with the applicable professional standards. Our auditor is headquartered in New York City, and has
been inspected by the PCAOB on a regular basis with the last inspection in 2020. However, the recent developments would add uncertainties
to our offering and we cannot assure you whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to
us after considering the effectiveness of our auditor’s audit procedures and quality control procedures, adequacy of personnel and
training, or sufficiency of resources, geographic reach, or experience as it relates to our audit. If it is later determined that
the PCAOB is unable to inspect or investigate completely our auditor because of a position taken by an authority in a foreign jurisdiction
or any other reasons, the lack of inspection could cause the trading in our securities to be prohibited under the Holding Foreign Companies
Accountable Act, and as a result Nasdaq may delist our securities. If our securities are unable to be listed on another securities exchange,
such a delisting would substantially impair your ability to sell or purchase our securities when you wish to do so, and the risk and uncertainty
associated with a potential delisting would have a negative impact on the price of our ordinary shares. Further, new laws and regulations
or changes in laws and regulations in both the United States and China could affect our ability to list and trade our ordinary shares
on Nasdaq, which could materially impair the market for and market price for our securities.
Future sales or other dilution of our
equity could depress the market price of our ordinary shares.
Sales of our ordinary
shares, preferred shares, warrants, rights, units or any combination of the foregoing in the public market, or the perception that such
sales could occur, could negatively impact the price of our ordinary shares. If one or more of our shareholders were to sell large portions
of their holdings in a relatively short time, for liquidity or other reasons, the prevailing market price of our ordinary shares could
be negatively affected.
In addition, the issuance
of additional shares of our ordinary shares, securities convertible into or exercisable for our ordinary shares, other equity-linked securities,
including preferred shares, warrants, rights or any combination of the securities pursuant to this prospectus will dilute the ownership
interest of our shareholders and could depress the market price of our ordinary shares and impair our ability to raise capital through
the sale of additional equity securities.
We may need to seek additional
capital. If this additional financing is obtained through the issuance of equity securities or warrants to acquire equity securities,
our existing shareholders could experience significant dilution upon the issuance, conversion or exercise of such securities.
Our management
will have broad discretion over the use of the proceeds we receive from the sale of our securities pursuant to this prospectus and might
not apply the proceeds in ways that increase the value of your investment.
Our management will have
broad discretion to use the net proceeds from any offerings under this prospectus, and you will be relying on the judgment of our management
regarding the application of these proceeds. Except as described in any prospectus supplement or in any related free writing prospectus
that we may authorize to be provided to you, the net proceeds received by us from our sale of the securities described in this prospectus
will be added to our general funds and will be used for general corporate purposes. Our management might not apply the net proceeds from
offerings of our securities in ways that increase the value of your investment and might not be able to yield a significant return, if
any, on any investment of such net proceeds. You may not have the opportunity to influence our decisions on how to use such proceeds.
FORWARD-LOOKING STATEMENTS
Some
of the statements contained or incorporated by reference in this prospectus may be “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the
Exchange Act and may involve material risks, assumptions and uncertainties. Forward-looking statements typically are identified by the
use of terms such as “may,” “will,” “should,” “believe,” “might,” “expect,”
“anticipate,” “intend,” “plan,” “estimate” and similar words, although some forward-looking
statements are expressed differently.
Although
we believe that the expectations reflected in such forward-looking statements are reasonable, these statements are not guarantees of future
performance and involve certain risks and uncertainties that are difficult to predict and which may cause actual outcomes and results
to differ materially from what is expressed or forecasted in such forward-looking statements. These forward-looking statements speak only
as of the date on which they are made and except as required by law, we undertake no obligation to publicly release the results of any
revision or update of these forward-looking statements, whether as a result of new information, future events or otherwise. If we do update
or correct one or more forward-looking statements, you should not conclude that we will make additional updates or corrections with respect
thereto or with respect to other forward-looking statements. A detailed discussion of risks and uncertainties that could cause actual
results and events to differ materially from our forward-looking statements is included in our periodic reports filed with the SEC and
in the “Risk Factors” section of this prospectus.
USE OF PROCEEDS
Except as described in any
prospectus supplement and any free writing prospectus in connection with a specific offering, we currently intend to use the net proceeds
from the sale of the securities offered under this prospectus to fund the development and the growth of our business, primarily working
capital, and for general corporate purposes. We may also use a portion of the net proceeds to acquire or invest in technologies and/or
businesses that we believe will enhance the value of our Company, although we have no current commitments or agreements with respect to
any such transactions as of the date of this prospectus. We have not determined the amount of net proceeds to be used specifically for
the foregoing purposes. As a result, our management will have broad discretion in the allocation of the net proceeds and investors will
be relying on the judgment of our management regarding the application of the proceeds of any sale of the securities.
DESCRIPTION OF SHARE CAPITAL
The following is a summary
of our share capital and certain provisions of our Second Amended and Restated Memorandum and Articles of Association. This summary does
not purport to be complete and is qualified in its entirety by the provisions of our Second Amended and Restated Memorandum and Articles
of Association and applicable provisions of the laws of the Cayman Islands. You are encouraged to read the relevant provisions of the
Companies Act and of our Second Amended and Restated Memorandum and Articles of Association as they relate to the following summary.
See “Where You Can Find
More Information” elsewhere in this prospectus for information on where you can obtain copies of our Second Amended and Restated
Memorandum and Articles of Association, which have been filed with and are publicly available from the SEC.
Our authorized share capital
is $50,000.00 divided into 1,000,000,000 shares comprising of (i) 900,000,000 ordinary shares of a nominal or par value of $0.00005 each;
and (ii) 100,000,000 preferred shares of a nominal or par value of $0.00005 each.
DESCRIPTION OF ORDINARY SHARES
As of the date of this prospectus,
21,044,712 ordinary shares are outstanding and listing on Nasdaq Capital Market under symbol “OCG”.
Dividends.
Subject to any rights and restrictions of any other class or series of shares, our board of directors may, from time to time,
declare dividends on the shares issued and authorize payment of the dividends out of our lawfully available funds. No dividends
shall be declared by the board out of our company except the following:
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“share premium account,” which represents the excess of the price paid to our company on issue of its shares over the par or “nominal” value of those shares, which is similar to the U.S. concept of additional paid in capital.
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However, no dividend shall bear interest against
the Company.
Voting Rights.
The holders of our ordinary shares are entitled to one vote per share, including the election of directors. Voting at any meeting of
shareholders is by show of hands unless a poll is demanded. On a show of hands every shareholder present in person or by proxy shall
have one vote. On a poll every shareholder entitled to vote (in person or by proxy) shall have one vote for each share for
which he/she is the holder. A poll may be demanded by the chairman or one or more shareholders present in person or by proxy holding
not less than 10 percent of the paid up share capital of the Company entitled to vote. A quorum required for a meeting of
shareholders consists of shareholders who hold at least one-third of our issued and outstanding shares entitled to vote at the
meeting present in person or by proxy and that any holder of shares of the class present in person or by proxy may demand a poll.
While not required by our articles of association, a proxy form will accompany any notice of general meeting convened by the
directors to facilitate the ability of shareholders to vote by proxy.
Any ordinary resolution to be made by the shareholders
requires the affirmative vote of a simple majority of the votes of the issued and outstanding ordinary shares cast in a general meeting,
while a special resolution requires the affirmative vote of no fewer than two-thirds of the votes of the issued and outstanding ordinary
shares cast. Under Cayman Islands law, some matters, such as amending the memorandum and articles, changing the name or resolving to be
registered by way of continuation in a jurisdiction outside the Cayman Islands, require approval of shareholders by a special resolution.
There are no limitations on non-residents or foreign
shareholders in the current memorandum and articles to hold or exercise voting rights on the ordinary shares imposed by foreign law or
by the charter or other constituent document of our company. However, no person will be entitled to vote at any general meeting or at
any separate meeting of the holders of the ordinary shares unless the person is registered as of the record date for such meeting and
unless all calls or other sums presently payable by the person in respect of ordinary shares in the Company have been paid.
Winding Up;
Liquidation. Upon the winding up of our company, after the full amount that holders of any issued shares ranking senior to the
ordinary shares as to distribution on liquidation or winding up are entitled to receive has been paid or set aside for payment, the
holders of our ordinary shares are entitled to receive any remaining assets of the Company available for distribution as determined
by the liquidator. The assets received by the holders of our ordinary shares in a liquidation may consist in whole or in part of
property, which is not required to be of the same kind for all shareholders.
Calls on Ordinary Shares and Forfeiture of
Ordinary Shares. Our board of directors may from time to time make calls upon shareholders for any amounts unpaid on their
ordinary shares in a notice served to such shareholders at least 14 days prior to the specified time and place of payment. Any ordinary
shares that have been called upon and remain unpaid are subject to forfeiture.
Redemption of
Ordinary Shares. We may issue shares that are, or at its option or at the option of the holders are, subject to redemption on
such terms and in such manner as it may, before the issue of the shares, determine. Under the Companies Act, shares of a Cayman
Islands exempted company may be redeemed or repurchased out of profits or share premium of the company, provided the current
memorandum and articles authorize this and it has the ability to pay its debts as they come due in the ordinary course of
business.
No Preemptive
Rights. Holders of ordinary shares will have no preemptive or preferential right to purchase any securities of our company.
Variation
of Rights Attaching to Shares. If at any time the share capital is divided into different classes of shares, the
rights attaching to any class (unless otherwise provided by
the terms of issue of the shares of that class) may, subject to the current memorandum and articles, be varied or abrogated with the
consent in writing of the holders of all of the issued shares of that class or with the sanction of an ordinary resolution passed at
a general meeting of the holders of the shares of that class.
Anti-Takeover Provisions. Some provisions
of our current memorandum and articles of association may discourage, delay or prevent a change of control of our company or management
that shareholders may consider favorable, including provisions that authorize our board of directors to issue preferred shares in one
or more series and to designate the price, rights, preferences, privileges and restrictions of such preferred shares without any further
vote or action by our shareholders.
However, under Cayman Islands law, our directors
may only exercise the rights and powers granted to them under our current memorandum and articles of association for a proper purpose
and for what they believe in good faith to be in the best interests of our company.
Exempted Company. We are an exempted company
with limited liability under the Companies Act. The Companies Act distinguishes between ordinary resident companies and exempted companies.
Any company that is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands may apply to be registered
as an exempted company. The requirements for an exempted company are essentially the same as for an ordinary company except that an exempted
company:
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does not have to file an annual return of its shareholders with the Registrar of Companies;
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is not required to open its register of members for inspection;
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does not have to hold an annual general meeting;
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may issue shares with no par value;
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may obtain an undertaking against the imposition of any future taxation (such undertakings are usually given for 20 years in the first instance);
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may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;
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may register as a limited duration company; and
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may register as a segregated portfolio company.
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“Limited liability” means that the
liability of each shareholder is limited to the amount unpaid by the shareholder on the shares of the company (except in exceptional circumstances,
such as involving fraud, the establishment of an agency relationship or an illegal or improper purpose or other circumstances in which
a court may be prepared to pierce or lift the corporate veil).
DESCRIPTION OF PREFERRED SHARES
Our board of directors is
empowered to designate and issue from time to time one or more classes or series of preferred shares and to fix and determine the relative
rights, preferences, designations, qualifications, privileges, options, conversion rights, limitations and other special or relative rights
of each such class or series so authorized. Such action could adversely affect the voting power and other rights of the holders of our
ordinary shares or could have the effect of discouraging any attempt by a person or group to obtain control of us.
As of the date of this prospectus,
there are no outstanding shares of preferred shares of any series.
You
should refer to the prospectus supplement relating to the series of preferred shares being offered for the specific terms of that series,
including:
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title of the series and the number of shares in the series;
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the price at which the preferred shares will be offered;
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the dividend rate or rates or method of calculating the rates, the dates on which the dividends will be payable, whether or not dividends will be cumulative or noncumulative and, if cumulative, the dates from which dividends on the preferred shares being offered will cumulate;
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the voting rights, if any, of the holders of preferred shares being offered;
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the provisions for a sinking fund, if any, and the provisions for redemption, if applicable, of the preferred shares being offered, including any restrictions on the foregoing as a result of arrearage in the payment of dividends or sinking fund installments;
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the liquidation preference per share;
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the terms and conditions, if applicable, upon which the preferred shares being offered will be convertible into our Ordinary Shares, including the conversion price, or the manner of calculating the conversion price, and the conversion period;
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the terms and conditions, if applicable, upon which the preferred shares being offered will be exchangeable for debt securities, including the exchange price, or the manner of calculating the exchange price, and the exchange period;
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any listing of the preferred shares being offered on any securities exchange;
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a discussion of any material federal income tax considerations applicable to the preferred shares being offered;
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the relative ranking and preferences of the preferred shares being offered as to dividend rights and rights upon liquidation, dissolution or the winding up of our affairs;
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any limitations on the issuance of any class or series of preferred shares ranking senior or equal to the series of preferred shares being offered as to dividend rights and rights upon liquidation, dissolution or the winding up of our affairs; and
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any additional rights, preferences, qualifications, limitations and restrictions of the series.
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Upon
issuance, the preferred shares will be fully paid and nonassessable, which means that its holders will have paid their purchase price
in full and we may not require them to pay additional funds.
Any
preferred share terms selected by the Board could decrease the amount of earnings and assets available for distribution to holders of
our Ordinary Shares or adversely affect the rights and power, including voting rights, of the holders of our Ordinary Shares without any
further vote or action by the stockholders. The rights of holders of our Ordinary Shares will be subject to, and may be adversely affected
by, the rights of the holders of any preferred shares that may be issued by us in the future. The issuance of preferred shares could also
have the effect of delaying or preventing a change in control of our company or make removal of management more difficult.
Description
of Warrants
The following summary of certain
provisions of the warrants does not purport to be complete and is subject to, and qualified in its entirety by reference to, the provisions
of the warrant agreement that will be filed with the SEC in connection with the offering of such warrants.
General
We
may issue warrants for the purchase of Ordinary Shares and/or Preferred Shares in one or more series. We may issue warrants independently
or together with Ordinary Shares and/or Preferred Shares and the warrants may be attached to or separate from these securities. While
the terms summarized below will apply generally to any warrants that we may offer, we will describe the particular terms of any series
of warrants in more detail in the applicable prospectus supplement. The terms of any warrants offered under a prospectus supplement may
differ from the terms described below.
We
will file as exhibits to the Registration Statement of which this prospectus is a part, or will incorporate by reference from reports
that we file with the SEC, the form of warrant agreement, including a form of warrant certificate, that describes the terms of the particular
series of warrants we are offering. The following summaries of material provisions of the warrants and the warrant agreements are subject
to, and qualified in their entirety by reference to, all the provisions of the warrant agreement and warrant certificate applicable to
the particular series of warrants that we may offer under this prospectus. We urge you to read the applicable prospectus supplements related
to the particular series of warrants that we may offer under this prospectus, as well as any related free writing prospectuses, and the
complete warrant agreements and warrant certificates that contain the terms of the warrants.
We
will describe in the applicable prospectus supplement the terms of the series of warrants being offered, including:
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the title of such warrants;
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the aggregate number of such warrants;
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the price or prices at which such warrants will be issued and exercised;
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the currency or currencies in which the price of such warrants will be payable;
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the securities purchasable upon exercise of such warrants;
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the date on which the right to exercise such warrants shall commence and the date on which such right shall expire;
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if applicable, the minimum or maximum amount of such warrants which may be exercised at any one time;
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if applicable, the designation and terms of the securities with which such warrants are issued and the number of such warrants issued with each such security;
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if applicable, the date on and after which such warrants and the related securities will be separately transferable;
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information with respect to book-entry procedures, if any;
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any material Cayman Islands or United States federal income tax consequences;
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the antidilution provisions of the warrants, if any; and
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any
other terms of such warrants, including terms, procedures and limitations relating to the exchange and exercise of such warrants.
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Exercise of Warrants
Each warrant will entitle
the holder to purchase the securities that we specify in the applicable prospectus supplement at the exercise price that we describe in
the applicable prospectus supplement. Holders of the warrants may exercise the warrants at any time up to the specified time on the expiration
date that we set forth in the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants
will become void.
Holders
of the warrants may exercise the warrants by delivering the warrant certificate representing the warrants to be exercised together with
specified information, and paying the required amount to the Company in immediately available funds, as provided in the applicable prospectus
supplement. We will set forth in the warrant certificate and in the applicable prospectus supplement the information that the holder of
the warrant will be required to deliver to the Company for warrant exercise.
If fewer than all of the warrants
represented by the warrant certificate are exercised, then we will issue a new warrant certificate for the remaining amount of warrants.
If we so indicate in the applicable prospectus supplement, holders of the warrants may surrender securities as all or part of the exercise
price for warrants.
Outstanding Warrants
As of the date of this prospectus,
there are outstanding warrants to purchase 600,000 Ordinary Shares.
DESCRIPTION OF SUBSCRIPTION RIGHTS
The following summary of certain
provisions of the subscription rights does not purport to be complete and is subject to, and qualified in its entirety by reference to,
the provisions of the certificate evidencing the subscription rights that will be filed with the SEC in connection with the offering of
such subscription rights.
General
We may issue subscription
rights to purchase ordinary shares or preferred shares. Subscription rights may be issued independently or together with any other offered
security and may or may not be transferable by the person purchasing or receiving the subscription rights. In connection with any subscription
rights offerings, we may enter into a standby underwriting arrangement with one or more underwriters pursuant to which such underwriters
will purchase any offered securities remaining unsubscribed for after such subscription rights offering. In connection with a subscription
rights offering to our shareholders, we will distribute certificates evidencing the subscription rights and a prospectus supplement to
our shareholders on the record date that we set for receiving subscription rights in such subscription rights offering.
The applicable prospectus
supplement will describe the following terms of subscription rights in respect of which this prospectus is being delivered:
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the title of such subscription rights;
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the securities for which such subscription rights are exercisable;
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the exercise price for such subscription rights;
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the number of such subscription rights issued to each shareholder;
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the extent to which such subscription rights are transferable;
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if applicable, a discussion of the material Cayman Islands or United States federal income tax considerations applicable to the issuance or exercise of such subscription rights;
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the date on which the right to exercise such subscription rights shall commence, and the date on which such rights shall expire (subject to any extension);
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the extent to which such subscription rights include an over-subscription privilege with respect to unsubscribed securities;
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if applicable, the material terms of any standby underwriting or other purchase arrangement that we may enter into in connection with the subscription rights offering; and
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any other terms of such subscription rights, including terms, procedures and limitations relating to the exchange and exercise of such subscription rights.
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Exercise of Subscription Rights
Each subscription right will
entitle the holder of the subscription right to purchase for cash such amount of securities at such exercise price as shall be set forth
in, or be determinable as set forth in, the prospectus supplement relating to the subscription rights offered thereby. Subscription rights
may be exercised at any time up to the close of business on the expiration date for such subscription rights set forth in the prospectus
supplement. After the close of business on the expiration date, all unexercised subscription rights will become void.
Subscription rights may be
exercised as set forth in the prospectus supplement relating to the subscription rights offered thereby. Upon receipt of payment and the
subscription rights certificate properly completed and duly executed at the corporate trust office of the subscription rights agent or
any other office indicated in the prospectus supplement, we will forward, as soon as practicable, the ordinary shares or preferred shares
purchasable upon such exercise. We may determine to offer any unsubscribed offered securities directly to persons other than shareholders,
to or through agents, underwriters or dealers or through a combination of such methods, including pursuant to standby underwriting arrangements,
as set forth in the applicable prospectus supplement.
DESCRIPTION OF UNITS
The following summary of certain
provisions of the units does not purport to be complete and is subject to, and qualified in its entirety by reference to, the provisions
of the certificate evidencing the units that will be filed with the SEC in connection with the offering of such units.
We may issue units comprised
of one or more of the other securities described in this prospectus in any combination. Each unit will be issued so that the holder of
the unit is also the holder, with the rights and obligations of a holder, of each security included in the unit. The unit agreement under
which a unit is issued may provide that the securities included in the unit may not be held or transferred separately, at any time or
at any time before a specified date or upon the occurrence of a specified event or occurrence.
The applicable prospectus
supplement will describe:
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the designation and terms of the units and of the securities comprising the units, including whether and under what circumstances those securities may be held or transferred separately;
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any unit agreement under which the units will be issued;
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●
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any provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units; and
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●
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whether the units will be issued in fully registered or global form.
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PLAN OF DISTRIBUTION
We may sell the securities
offered through this prospectus (i) to or through underwriters or dealers, (ii) directly to purchasers, including our affiliates, (iii)
through agents, or (iv) through a combination of any these methods. The securities may be distributed at a fixed price or prices, which
may be changed, market prices prevailing at the time of sale, prices related to the prevailing market prices, or negotiated prices. The
prospectus supplement will include the following information:
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●
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the terms of the offering;
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●
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the names of any underwriters or agents;
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●
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the name or names of any managing underwriter or underwriters;
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●
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the purchase price of the securities;
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●
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any over-allotment options under which underwriters may purchase additional securities from us;
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●
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the net proceeds from the sale of the securities;
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any delayed delivery arrangements;
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●
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any underwriting discounts, commissions and other items constituting underwriters’ compensation;
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●
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any initial public offering price;
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●
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any discounts or concessions allowed or reallowed or paid to dealers;
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any commissions paid to agents; and
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●
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any securities exchange or market on which the securities may be listed.
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Sale Through Underwriters or Dealers
Only underwriters named in
the prospectus supplement are underwriters of the securities offered by the prospectus supplement. If underwriters are used in the sale,
the underwriters will acquire the securities for their own account, including through underwriting, purchase, security lending or repurchase
agreements with us. The underwriters may resell the securities from time to time in one or more transactions, including negotiated transactions.
Underwriters may sell the securities in order to facilitate transactions in any of our other securities (described in this prospectus
or otherwise), including other public or private transactions and short sales. Underwriters may offer securities to the public either
through underwriting syndicates represented by one or more managing underwriters or directly by one or more firms acting as underwriters.
Unless otherwise indicated in the prospectus supplement, the obligations of the underwriters to purchase the securities will be subject
to certain conditions, and the underwriters will be obligated to purchase all the offered securities if they purchase any of them. The
underwriters may change from time to time any public offering price and any discounts or concessions allowed or reallowed or paid to dealers.
If dealers are used in the
sale of securities offered through this prospectus, we will sell the securities to them as principals. They may then resell those securities
to the public at varying prices determined by the dealers at the time of resale. The prospectus supplement will include the names of the
dealers and the terms of the transaction.
We will provide in the applicable
prospectus supplement any compensation we will pay to underwriters, dealers or agents in connection with the offering of the securities,
and any discounts, concessions or commissions allowed by underwriters to participating dealers.
Direct Sales and Sales Through Agents
We may sell the securities
offered through this prospectus directly. In this case, no underwriters or agents would be involved. Such securities may also be sold
through agents designated from time to time. The prospectus supplement will name any agent involved in the offer or sale of the offered
securities and will describe any commissions payable to the agent. Unless otherwise indicated in the prospectus supplement, any agent
will agree to use its reasonable best efforts to solicit purchases for the period of its appointment.
We may sell the securities
directly to institutional investors or others who may be deemed to be underwriters within the meaning of the Securities Act with respect
to any sale of those securities. The terms of any such sales will be described in the prospectus supplement.
Delayed Delivery Contracts
If the prospectus supplement
indicates, we may authorize agents, underwriters or dealers to solicit offers from certain types of institutions to purchase securities
at the public offering price under delayed delivery contracts. These contracts would provide for payment and delivery on a specified date
in the future. The contracts would be subject only to those conditions described in the prospectus supplement. The applicable prospectus
supplement will describe the commission payable for solicitation of those contracts.
Market Making, Stabilization and Other Transactions
Unless the applicable prospectus
supplement states otherwise, other than our Ordinary Shares, all securities we offer under this prospectus will be a new issue and will
have no established trading market. We may elect to list offered securities on an exchange or in the over-the-counter market. Any underwriters
that we use in the sale of offered securities may make a market in such securities, but may discontinue such market making at any time
without notice. Therefore, we cannot assure you that the securities will have a liquid trading market.
Any underwriter may also engage
in stabilizing transactions, syndicate covering transactions and penalty bids in accordance with Rule 104 under the Securities Exchange
Act. Stabilizing transactions involve bids to purchase the underlying security in the open market for the purpose of pegging, fixing or
maintaining the price of the securities. Syndicate covering transactions involve purchases of the securities in the open market after
the distribution has been completed in order to cover syndicate short positions.
Penalty bids permit the underwriters
to reclaim a selling concession from a syndicate member when the securities originally sold by the syndicate member are purchased in a
syndicate covering transaction to cover syndicate short positions. Stabilizing transactions, syndicate covering transactions and penalty
bids may cause the price of the securities to be higher than it would be in the absence of the transactions. The underwriters may, if
they commence these transactions, discontinue them at any time.
General Information
Agents, underwriters, and
dealers may be entitled, under agreements entered into with us, to indemnification by us against certain liabilities, including liabilities
under the Securities Act. Our agents, underwriters, and dealers, or their affiliates, may be customers of, engage in transactions with
or perform services for us, in the ordinary course of business.
EXPENSES OF ISSUANCE
AND DISTRIBUTION
The following table sets
forth the various expenses in connection with the sale and distribution of the securities being registered. We will bear all of the expenses
shown below.
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Securities and Exchange Commission registration fee
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$
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18,540
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|
Printing expenses
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|
|
|
*
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|
Legal fees and expenses
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|
|
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*
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Accounting fees and expenses
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*
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Transfer agent fees and expenses
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|
|
|
*
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Miscellaneous
|
|
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|
*
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Total
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$
|
|
*
|
|
*
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The amount of securities and number of offerings are indeterminable, and the expenses cannot be estimated at this time.
|
LEGAL MATTERS
We are being represented by
FisherBroyles, LLP with respect to legal matters of United States federal securities and New York State law. Maples and Calder (Hong Kong)
LLP will pass upon certain legal matters in connection with the securities offered to the extent governed by Cayman Islands law.
EXPERTS
The consolidated financial
statements as of December 31, 2020 and 2019 and for the two years ended December 31, 2020 and 2019, incorporated by reference from the
Company’s Annual Report on Form 20-F for the year ended December 31, 2020 have been audited by Wei, Wei & Co., LLP, an independent
registered public accounting firm, as set forth in their report, which is incorporated herein by reference, and are included in reliance
upon such report given on the authority of such firm as experts in accounting and auditing. The office of Wei, Wei & Co., LLP is located
at 133-10 39th Avenue Flushing, New York 11354.
INFORMATION INCORPORATED BY REFERENCE
The SEC allows us to “incorporate
by reference” the information we file with them. This means that we can disclose important information to you by referring you to
those documents. Each document incorporated by reference is current only as of the date of such document, and the incorporation by reference
of such documents shall not create any implication that there has been no change in our affairs since the date thereof or that the information
contained therein is current as of any time subsequent to its date. The information incorporated by reference is considered to be a part
of this prospectus and should be read with the same care. When we update the information contained in documents that have been incorporated
by reference by making future filings with the SEC, the information incorporated by reference in this prospectus is considered to be automatically
updated and superseded. In other words, in the case of a conflict or inconsistency between information contained in this prospectus and
information incorporated by reference into this prospectus, you should rely on the information contained in the document that was filed
later.
We hereby incorporate by reference
into this prospectus the following documents that we have filed with the SEC under the Exchange Act:
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(1)
|
the Company’s
Annual Report on Form 20-F for the fiscal year ended December 31, 2020, filed with the SEC on April 30, 2021;
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|
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(3)
|
the description of our Ordinary Shares incorporated by reference in our registration statement on Form 8-A, as amended (File No. 001-39734) filed with the Commission on November 23, 2020, including any amendment and report subsequently filed for the purpose of updating that description; and
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(4)
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with respect to each offering of the securities under this prospectus, all our subsequent annual reports on Form 20-F and any report on Form 6-K that indicates that it is being incorporated by reference that we file or furnish with the SEC on or after the date on which the registration statement is first filed with the SEC and until the termination or completion of the offering by means of this prospectus.
|
Our 2020 Annual Report contains
a description of our business and audited consolidated financial statements with a report by our independent auditors. The consolidated
financial statements are prepared and presented in conformity with U.S. generally accepted accounting principles.
Unless
expressly incorporated by reference, nothing in this prospectus shall be deemed to incorporate by reference information furnished to,
but not filed with, the SEC. Copies of all documents incorporated by reference in this prospectus, other than exhibits to those documents
unless such exhibits are specifically incorporated by reference in this prospectus, will be provided at no cost to each person, including
any beneficial owner, who receives a copy of this prospectus on the written or oral request of that person made to: Oriental Culture
Holding LTD. Attn: Company Secretary, Room
1402, Richmake Commercial Building, 198-200 Queen’s Road Central, Hong Kong and email:
IR@ocgroup.hk
You should rely only on the
information that we incorporate by reference or provide in this prospectus. We have not authorized anyone to provide you with different
information. We are not making any offer of these securities in any jurisdiction where the offer is not permitted. You should not assume
that the information in this prospectus or any prospectus supplement is accurate as of any date other than the date on the front of those
documents.
WHERE YOU CAN FIND MORE INFORMATION
As permitted by SEC rules,
this prospectus omits certain information and exhibits that are included in the registration statement of which this prospectus forms
a part. Since this prospectus may not contain all of the information that you may find important, you should review the full text of these
documents. If we have filed a contract, agreement or other document as an exhibit to the registration statement of which this prospectus
forms a part, you should read the exhibit for a more complete understanding of the document or matter involved. Each statement in this
prospectus, including statements incorporated by reference as discussed above, regarding a contract, agreement or other document is qualified
in its entirety by reference to the actual document.
We
are subject to the information reporting requirements of the Exchange Act that are applicable to foreign private issuers, and, in
accordance with these requirements, we file annual and current reports and other information with the SEC. You may inspect, read (without
charge) and copy the reports and other information we file with the SEC at the SEC’s Public Reference Room located at 100 F Street,
N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.
The SEC also maintains an internet website at www.sec.gov that contains our filed reports and other information that
we file electronically with the SEC.
We
maintain a corporate website at www.ocgroup.hk. Information contained on, or that can be accessed through, our website does not constitute
a part of this prospectus.
ENFORCEABILITY
OF CIVIL LIABILITIES
We
are incorporated under the laws of the Cayman Islands as an exempted company with limited liability. We incorporated in the Cayman Islands
because of certain benefits associated with being a Cayman Islands exempted company, such as political and economic stability, an effective
judicial system, a favorable tax system, the absence of foreign exchange control or currency restrictions and the availability of professional
and support services. However, the Cayman Islands have a less developed body of securities laws that provide significantly less protection
to investors as compared to the securities laws of the United States. In addition, Cayman Islands companies may not have standing to
sue before the federal courts of the United States.
All
of our assets are located in Hong Kong and China. In addition, all of our directors and officers are residents of jurisdictions other
than the United States and all or a substantial portion of their assets are located outside the United States. As a result, it may be
difficult for investors to effect service of process within the United States upon us or our directors and officers, or to enforce against
us or them judgments obtained in United States courts, including judgments predicated upon the civil liability provisions of the securities
laws of the United States or any state in the United States.
Maples and Calder (Hong Kong)
LLP, our counsel as to Cayman Islands law has advised us, respectively, that there is uncertainty as to whether the courts of the Cayman
Islands would:
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●
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recognize
or enforce judgments of United States courts obtained against us or our directors or officers
predicated upon the civil liability provisions of the securities laws of the United States
or any state in the United States; or
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●
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entertain
original actions brought in each respective jurisdiction against us or our directors or officers
predicated upon the securities laws of the United States or any state in the United States.
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Maples
and Calder (Hong Kong) LLP has informed us that it is uncertain whether
the courts of the Cayman Islands would (i) recognize or enforce judgments of U.S. courts obtained against us or our directors or
officers that are predicated upon the civil liability provisions of the federal securities laws of the United States or the securities
laws of any state in the United States, or (ii) entertain original actions brought in the Cayman Islands against us or our directors
or officers that are predicated upon the federal securities laws of the United States or the securities laws of any state in the United
States.
Maples
and Calder (Hong Kong) LLP has informed us that although there is no statutory
enforcement in the Cayman Islands of judgments obtained in the federal or state courts of the United States (and the Cayman Islands are
not a party to any treaties for the reciprocal enforcement or recognition of such judgments), the courts of the Cayman Islands will,
at common law, recognize and enforce a foreign monetary judgment of a foreign court of competent jurisdiction without any re-examination
of the merits of the underlying dispute based on the principle that a judgment of a competent foreign court imposes upon the judgment
debtor an obligation to pay the liquidated sum for which such judgment has been given, provided such judgment (a) is given by a foreign
court of competent jurisdiction, (b) imposes on the judgment debtor a liability to pay a liquidated sum for which the judgment has been
given, (c) is final, (d) is not in respect of taxes, a fine or a penalty, and (e) was not obtained in a manner and is not of a kind the
enforcement of which is contrary to natural justice or the public policy of the Cayman Islands. However, the Cayman Islands courts are
unlikely to enforce a judgment obtained from the U.S. courts under civil liability provisions of the U.S. federal securities law if such
judgment is determined by the courts of the Cayman Islands to give rise to obligations to make payments that are penal or punitive in
nature. A Cayman Islands court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.
ORIENTAL
CULTURE HOLDING LTD.
$200,000,000
Ordinary
Shares,
Preferred
Shares,
Warrants,
Rights
and
Units
PROSPECTUS
______,
2022
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
8. Indemnification of Directors and Officers
Cayman
Islands law does not limit the extent to which a company’s memorandum and articles of association may provide for indemnification
of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public
policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. Our current memorandum and
articles of association permit indemnification of officers and directors for losses, damages, costs and expenses incurred in their capacities
as such unless such losses or damages arise from dishonesty or fraud of such directors or officers. In addition, we have entered into
indemnification agreements with our directors and executive officers that provide such persons with additional indemnification beyond
that provided in our current memorandum and articles of association.
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling
us under the foregoing provisions, we have been informed that in the opinion of the SEC, such indemnification is against public policy
as expressed in the Securities Act and is therefore unenforceable.
Item
9. Exhibits
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|
*
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To
be filed as an exhibit to a post-effective amendment to this registration statement or as
an exhibit to a report filed or furnished pursuant to the Exchange Act of the Registrant
and incorporated herein by reference.
|
Item 10
Undertakings
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(a)
|
The undersigned registrant
hereby undertakes:
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(1)
|
To file, during any period
in which offers or sales are being made, a post-effective amendment to this registration statement:
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(i)
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To include any prospectus
required by Section 10(a)(3) of the Securities Act of 1933;
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(ii)
|
To reflect in the prospectus
any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes
in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation
of Registration Fee” table in the effective registration statement.
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|
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(iii)
|
To include any material
information with respect to the plan of distribution not previously disclosed in the registration statement or any material change
to such information in the registration statement.
|
provided,
however, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not apply if the information required to be included
in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Securities and Exchange Commission
by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration
statement, or is contained in a form of prospectus filed pursuant to Rule 424(b).
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|
(2)
|
That, for the purpose of
determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
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(3)
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To remove from registration
by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
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(4)
|
To
file a post-effective amendment to the registration statement to include any financial statements
required by Item 8.A of Form 20-F at the start of any delayed offering or throughout a continuous
offering. Financial statements and information otherwise required by Section 10(a)(3) of
the Securities Act need not be furnished, provided that the Registrant includes
in the prospectus, by means of a post-effective amendment, financial statements required
pursuant to this paragraph (a)(4) and other information necessary to ensure that all other
information in the prospectus is at least as current as the date of those financial statements.
Notwithstanding the foregoing, with respect to registration statements on Form F-3, a post-effective
amendment need not be filed to include financial statements and information required by Section
10(a)(3) of the Securities Act or Item 8.A of Form 20-F if such financial statements and
information are contained in periodic reports filed with or furnished to the SEC by the Registrant
pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the Form F-3.
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|
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(5)
|
That,
for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
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(i)
|
Each prospectus filed by
the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus
was deemed part of and included in the registration statement; and
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(ii)
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Each prospectus required
to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to
an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by Section 10(a)
of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date
such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering
described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an
underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the
registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof. Provided, however, that no statement made in a registration statement
or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into
the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract
of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus
that was part of the registration statement or made in any such document immediately prior to such effective date.
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(6)
|
That, for the purpose of
determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:
The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration
statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold
to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and
will be considered to offer or sell such securities to such purchaser:
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(i)
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Any preliminary prospectus
or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
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(ii)
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Any free writing prospectus
relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
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(iii)
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The portion of any other
free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities
provided by or on behalf of the undersigned registrant; and
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(iv)
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Any other communication
that is an offer in the offering made by the undersigned registrant to the purchaser.
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(b)
|
That, for purposes of determining
any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to section 13(a) or
section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual
report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
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|
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(c)
|
Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that
a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication
of such issue.
|
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form F-3 and has duly caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in Hong Kong, on January 28, 2022.
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Oriental Culture Holding LTD.
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By:
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/s/ Yi
Shao
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Name:
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Yi Shao
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|
Title:
|
Chief Executive Officer
|
POWER
OF ATTORNEY
KNOW
ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Yi Shao and Lijia Ni, and each
of them, as his or her true and lawful attorneys-in-fact and agents, each with full power of substitution and resubstitution, for him
or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments)
and supplements to this registration statement on Form F-3 and to file the same, with all exhibits thereto, and other documents in connection
therewith, with the United States Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith and
about the premises, as fully to all intents and purposes as each such person might or could do in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents, or any of them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.
Pursuant
to the requirements of the U.S. Securities Act of 1933, as amended, this Form F-3 registration statement has been signed by the following
persons in the capacities and on the date indicated.
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Signature
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Title
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Date
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/s/ Yi Shao
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Chief Executive Officer and
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|
January 28, 2022
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Yi Shao
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Director
(Principal
Executive Officer)
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/s/
Lijia Ni
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Chief Financial Officer
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|
January
28, 2022
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Lijia Ni
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(Principal Accounting and Financial Officer)
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/s/ Mun Wah
Wan
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Chairman of the Board and Director
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January 28, 2022
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Mun Wah Wan
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/s/ Nelson
(Nam Sum) Wong
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Director
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|
January 28, 2022
|
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Nelson (Nam Sum) Wong
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/s/ Xiaobing
Liu
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Director
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|
January 28, 2022
|
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Xiaobing Liu
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/s/ Jinren
Chen
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Director
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January 28, 2022
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Jinren Chen
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SIGNATURE
OF AUTHORIZED REPRESENTATIVE IN THE UNITED STATES
Pursuant
to the requirements of the Securities Act of 1933, as amended, the undersigned, the duly authorized representative in the United States
of Oriental Culture Holding LTD has signed this registration statement on the 28th day of January, 2022.
|
|
Authorized
U.S. Representative
|
|
|
Cogency
Global Inc.
|
|
|
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|
|
/s/
Colleen A. DeVries
|
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Name:
|
Colleen A. DeVries
|
|
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Title:
|
Senior Vice
President
|
II-6
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