QDM International Inc 10-K/A, filed Dec 15, 2023
QDM International Inc. (QDMI)
About this 10-K/A
QDM International Inc filed this 10-K/A on December 15, 2023, covering the fiscal year ended March 31, 2023.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Amendment No.2)
For
the fiscal year ended
For the transition period from___________ to___________
Commission
file number
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of | (I.R.S. Employer | |
| incorporation or organization) | Identification No.) | |
| (Address of principal executive offices) | (Zip Code) |
| (Registrant’s telephone number, including area code) |
Securities registered pursuant to Section 12(b)
of the Act:
Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.0001
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant
to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit and post such files)
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |
| ☒ | Smaller reporting company | |||
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report.
If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐
The
aggregate market value of the voting and non-voting common stock held by non-affiliates computed by reference to the price at which the
common stock was last sold on the OTCQB Marketplace operated by the OTC Markets as of September 30, 2022 ($0.81) was approximately $
As
of June 29, 2023,
| Auditor Name: | Auditor Location: | Auditor Firm ID: | ||
Explanatory Note
TABLE OF CONTENTS
| PART I | ||
| Item 1A. | Risk Factors | 1 |
| PART III | ||
| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 2 |
| PART IV | ||
| Item 15. | Exhibits, Financial Statement Schedules | 3 |
i
Item 1A. Risk Factors
Summary of Risk Factors
Risks Related to Our Common Stock
| ● | Our controlling stockholder may exercise significant influence over us and may be subject to conflicts of interest. |
| ● | The Series B Preferred Stock, which are controlled by Mr. Huihe Zheng, our Chairman of the Board, Chief Executive Officer, have super voting rights that may adversely affect our holders of common stock; in addition, Mr. Zheng, as our controlling stockholder, may exercise significant influence over us and may be subject to conflicts of interest. |
Risks Related to Our Common Stock
Our controlling stockholder may exercise significant influence over us and may be subject to conflicts of interest.
Our Chairman of the Board, Chief Executive Officer and President, Huihe Zheng, owns approximately 61.0% of our outstanding voting power. Mr. Zheng thus has the power, on his own, to determine the outcome of any corporate transaction or other matters submitted to our stockholders for approval, including mergers, consolidations and the sale of all or substantially all of our assets, election of directors, approval of equity incentive plans, and other significant corporate actions. Mr. Zheng also has the power to prevent or cause a change in control. In addition, without the consent of Mr. Zheng, we could be prevented from entering into transactions that could be beneficial to us. The interests of Mr. Zheng may differ from the interests of our other stockholders, which cause him to be faced with conflicts of interests that may not be resolved in favor of or to the satisfaction of our minority stockholders.
The Series B Preferred Stock, which are controlled by our Chairman of the Board, Chief Executive Officer, have super voting rights that may adversely affect our holders of common stock.
Except as required by law, holders of Series B Preferred Stock (which is currently controlled by Huihe Zheng, our Chairman of the Board, Chief Executive Officer) are entitled to super voting rights. Each share of Series B Preferred Stock is entitled to 100 votes. Holders of Series B Preferred Stock will vote together on all matters upon which common stock holders are entitled to vote. The voting rights of holders of our common stock will be diluted as a result of these super voting rights.
1
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table sets forth certain information known to us with respect to the beneficial ownership of common stock by (i) each person, entity or group (as that term is used in Section 13(d)(3) of the Exchange Act) known to us to be the beneficial owner of more than 5% of the outstanding shares of common stock, (ii) each of our directors and executive officers, and (iii) all of our directors and executive officers as a group. The percentage of class is based on 29,156,393 shares of common stock, 13,500 shares of Series B Preferred Stock, and 531,886 shares of Series C Preferred Stock issued and outstanding as of the date of this Report.
| Name of Beneficial Owner 5% Stockholders | Number of Shares of Common Stock Owned | Percentage of Shares of Common Stock Owned | Number of Shares of Series B Preferred Stock Owned | Percentage of Shares of Series B Preferred Stock Owned | Number of Shares of Series C Preferred Stock Owned | Percentage of Shares of Series C Preferred Stock Owned | Percentage of Aggregate Voting Power (1)(2) | |||||||||||||||||||||
| HW FUND(3) | 12,000,000 | 41.2 | % | — | — | — | — | 39.1 | % | |||||||||||||||||||
| Willington Capital Limited(4) | 5,000,000 | 17.2 | % | — | — | — | — | 16.3 | % | |||||||||||||||||||
| Ruiyin Capital Limited(5) | 4,800,000 | 16.5 | % | — | — | — | — | 15.6 | % | |||||||||||||||||||
| Bakelai Capital Limited(6) | 5,000,000 | 17.2 | % | — | — | — | — | 16.3 | % | |||||||||||||||||||
| Directors and Officers | ||||||||||||||||||||||||||||
| Huihe Zheng(3) | 12,158,810 | 41.7 | % | 13,500 | 100 | % | 531,886 | 100 | % | 44.6 | %(1)(2) | |||||||||||||||||
| Tim Shannon(7) | 8,196 | * | — | — | — | — | * | |||||||||||||||||||||
| Huili Shen(4) | 5,000,167 | 17.1 | % | — | — | — | — | 16.3 | % | |||||||||||||||||||
| Timothy Miles(8) | 8,167 | * | — | — | — | — | * | |||||||||||||||||||||
| All officers and directors as a group (four persons) | 17,175,340 | 58.9 | % | 13,500 | 100 | % | 531,886 | 100 | % | 61.0 | % | |||||||||||||||||
| * | Less than one percent. |
| (1) | Each share of Series B Preferred Stock entitles the holder to 100 votes on all corporate matters submitted for stockholder approval. |
| (2) | Each share of Series C Preferred Stock entitles the holder to approximately 0.3667 votes on all corporate matters submitted for stockholder approval. |
| (3) | 12,000,000 shares of common stock directly held by HW FUND, of which Huihe Zheng, our Chief Executive Officer and President, is the controlling shareholder and holds the voting and dispositive power over the shares of common stock held by such entity. The address for this stockholder is Vistra (Cayman) Limited, P.O. Box 31119, Grand Pavilion, Hibiscus Way, 802 West Bay Road, Grand Cayman, KY1-1205, Cayman Islands. |
| (4) | 5,000,000 shares of common stock directly held by Willington Capital Limited, of which Huili Shen, our director, is the sole shareholder and director and holds the voting and dispositive power over the shares of common stock held by such entity. The address for this stockholder is Rm 4F, 15/F, Sunwise Industrial Building, 16-26 Wang Wo Tsai Street, Tsuen Wan, Hong Kong. |
| (5) | Erkai Wang is the sole shareholder and director of Ruiyin Capital Limited. The address for this stockholder is Rm 4G, 15/F, Sunwise Industrial Building, 16-26 Wang Wo Tsai Street, Tsuen Wan, Hong Kong. |
| (6) | Shimei Zhou is the sole shareholder and director of Bakelai Capital Limited. The address for this stockholder is Rm 4, 15/F, Sunwise Industrial Building, 16-26 Wang Wo Tsai Street, Tsuen Wan, Hong Kong. |
| (7) | The address for this stockholder is 2035 Highway A1A, #306 Indian Harbour Beach, FL 32937. |
| (8) | The address for this stockholder is PO Box 30, Dundee, MI 48131. |
2
PART IV
Item 15. Exhibits, Financial Statement Schedules.
(3) Exhibits
| Exhibit No. | Description | |
| 31.1** | Certification by Chief Executive Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act, promulgated pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2** | Certification by Chief Financial Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act, promulgated pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 101.INS | Inline XBRL Instance Document. | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Linkbase Document. | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
| ** | Furnished herewith. |
3
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| QDM International Inc. | ||
| Date: December 15, 2023 | By: | /s/ Huihe Zheng |
| Name: | Huihe Zheng | |
| Title: | Chairman of the Board, Chief Executive Officer, and President | |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| Signature | Title | Date | ||
| /s/ Huihe Zheng | Chairman of the Board, Chief Executive Officer | December 15, 2023 | ||
| Huihe Zheng | (principal executive officer), and President | |||
| /s/ Tim Shannon | Chief Financial Officer | December 15, 2023 | ||
| Tim Shannon | (principal accounting and financial officer) and Director | |||
| /s/ Timothy Miles | Director | December 15, 2023 | ||
| Timothy Miles | ||||
| /s/ Huili Shen | Secretary and Director | December 15, 2023 | ||
| Huili Shen |
4
Exhibit 31.1
CERTIFICATION
Pursuant to 18 U.S.C. Section 1350,
As adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Huihe Zheng, certify that:
| 1. | I have reviewed this Annual Report on Form 10-K/A2 of QDM International Inc. (the “registrant”); and |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report. |
Date: December 15, 2023
| /s/ Huihe Zheng | ||
| Name: | Huihe Zheng | |
| Title: |
Chief Executive Officer (Principal Executive Officer) |
Exhibit 31.2
CERTIFICATION
Pursuant to 18 U.S.C. Section 1350,
As adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Tim Shannon, certify that:
| 1. | I have reviewed this Annual Report on Form 10-K/A2 of QDM International Inc. (the “registrant”); and |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report. |
Date: December 15, 2023
| /s/ Tim Shannon | ||
| Name: | Tim Shannon | |
| Title: |
Chief Financial Officer (Principal Financial and Accounting Officer)) |