Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 21, 2023

GROM SOCIAL ENTERPRISES, INC.

(Exact name of registrant as specified in its charter)

Florida

001-40409

46-5542401

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

2060 NW Boca Raton Blvd., Suite #6

Boca Raton, Florida 33431

(Address of principal executive offices)

Registrant’s telephone number, including area code: (561) 287-5776

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Company under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbols	Name of each exchange on which registered
Common Stock, par value $0.001	GROM	The Nasdaq Capital Market
Warrants to purchase shares of Common Stock, par value $0.001 per share	GROMW	The Nasdaq Capital Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 8.01

Other Events.

On December 21, 2023, Grom Social Enterprises, Inc., a Florida corporation (the “Company”), issued a press release announcing the first closing (the “First Closing”) of its previously announced private placement offering (the “Offering”) relating to the Securities Purchase Agreement, dated November 9, 2023 and amended on November 20, 2023 (the “SPA”), entered into with Generating Alpha Ltd., a Saint Kitts and Nevis Corporation (the “Investor”).

In the First Closing, the Company sold one convertible promissory note of the Company (the “Note”), with an initial principal amount of $4,000,000, for a price of $3,640,000. In connection with the purchase and sale of the Note, the Company also issued to the Investor warrants (the “Warrants”) to acquire a total of 1,514,072 shares of the Company’s Common Stock, par value $0.001 per share (the “Common Stock”), consisting of (1) 757,036 warrants to purchase 757,036 shares of Common Stock with an exercise price of $1.78 per share of Common Stock and (ii) 757,036 warrants to purchase 757,036 shares of Common Stock with an exercise price of $0.001 per share of Common Stock.

The First Closing of the Offering took place on December 21, 2023. The Company received approximately $3.6 million in gross proceeds from the First Closing, prior to deducting the underwriting discount and commission and other estimated offering expenses payable by the Company. The Company intends to use the net proceeds from this offering for working capital and general corporate purposes.

A copy of the press release is attached as Exhibit 99.1 hereto.

Cautionary Statements

This filing includes “forward-looking statements.” All statements other than statements of historical facts included or incorporated herein may constitute forward-looking statements. Actual results could vary significantly from those expressed or implied in such statements and are subject to a number of risks and uncertainties. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company can give no assurance that such expectations will prove to be correct. The forward-looking statements involve risks and uncertainties that affect the Company’s operations, financial performance, and other factors as discussed in the Company’s filings with the SEC. Among the factors that could cause results to differ materially are those risks discussed in the periodic reports the Company files with the SEC. You are urged to carefully review and consider the cautionary statements and other disclosures made in those filings, specifically those under the heading “Risk Factors.” The Company does not undertake any duty to update any forward-looking statement except as required by law.

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.		Description
99.1		Press Release dated December 21, 2023, announcing the First Closing of the Offering.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	GROM SOCIAL ENTERPRISES, INC.


Date: December 27, 2023	By:	/s/ Darren Marks
		Darren Marks Chief Executive Officer

Exhibit 99.1

Grom Social Enterprises, Inc. Announces Closing of $4.0 Million Private Placement

BOCA RATON, Fla., Dec. 21, 2023 (GLOBE NEWSWIRE) -- Grom Social Enterprises, Inc. (NASDAQ: GROM; GROMW) (“Grom” or the “Company”), a media, technology and entertainment company dedicated to family-friendly programming, web filtering technology and safe social media for kids, today announced the first closing of its previously announced private placement of a convertible promissory note with an initial principal amount of $4,000,000 (the “Notes”). The Notes are being issued pursuant to the securities purchase agreement, dated as of November 9, 2023 (as amended) with a single institutional investor (the “Investor”). In connection with the purchase and sale of the Notes, the Company has agreed to issue to the Investor, warrants to acquire a total of 1,514,072 shares of Common Stock consisting of (1) 757,036 shares of Common Stock with an exercise price of $1.78 per share of Common Stock and (ii) 757,036 shares of Common Stock with an exercise price of $.001 per share of Common Stock.

The Company intends to use the net proceeds from the private placement for general working capital and administrative purposes.

EF Hutton LLC acted as exclusive placement agent for the offering.

The shares of common stock and warrants described above have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission (SEC) or an applicable exemption from such registration requirements. The securities were offered only to accredited investors. Pursuant to a registration rights agreement with the investors, the Company has agreed to file one or more registration statements with the SEC covering the resale of the shares of common stock and the shares issuable upon exercise of the pre-funded warrants and warrants.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Grom Social Enterprises, Inc.

Grom Social Enterprises, Inc. (NASDAQ: GROM) is a growing social media platform and original content provider of entertainment for children under 13 years of age, which provides safe and secure digital environments for kids that can be monitored by their parents or guardians. The Company has several operating subsidiaries, including Grom Social, which delivers its content through mobile and desktop environments (web portal and apps) that entertain children, let them interact with friends, access relevant news, and play proprietary games while teaching them about being good digital citizens. The Company owns and operates Top Draw Animation, which produces award-winning animation content for some of the largest international media companies in the world. The company owns an 80% stake in Curiosity Ink Media, which is a global media company that develops, acquires, builds, grows and maximizes the short, mid, and long-term commercial potential of Kids & Family entertainment properties and associated business opportunities. Grom also includes Grom Educational Services, which has provided web filtering services for K-12 schools, government and private businesses. For more information, please visit the Company’s website at gromsocial.com or for investor relations information, please visit investors.gromsocial.com.

Safe Harbor Statement

This press release may contain forward-looking statements about Grom Social Enterprises, Inc. activities that are based on current expectations, forecasts, and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially from those anticipated or expected, including statements related to the amount and timing of expected revenues and any payment of dividends on our common stock, statements related to our financial performance, expected income, distributions, and future growth for upcoming quarterly and annual periods, and other risks set forth in the Company’s filings with the U.S. Securities and Exchange Commission, including our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q. Actual results and the timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors. Among other matters, the Company may not be able to sustain growth or achieve profitability based upon many factors including, but not limited to general stock market conditions. We have incurred and will continue to incur significant expenses in the expansion of our existing and new service lines, noting there is no assurance that we will generate enough revenues to offset those costs in both the near and long-term. Additional service offerings may expose us to additional legal and regulatory costs and unknown exposure(s) based upon the various geopolitical locations where we will be providing services, the impact of which cannot be predicted at this time. All forward-looking statements speak only as of the date of this press release. We undertake no obligation to update any forward-looking statements or other information contained herein. Stockholders and potential investors should not place undue reliance on these forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in or suggested by the forward-looking statements in this report are reasonable, we cannot assure stockholders and potential investors that these plans, intentions or expectations will be achieved. Except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise.

Investor Relations Contact:

Floyd Stumpf Worldwide Financial Marketing, Inc.

info@wwfinancial.com

(954) 360-9998

Media Contact:
Paul Ward
Grom Social Enterprises, Inc.
paul@gromsocial.com
(917) 593-6066

Cover	Dec. 21, 2023
Document Type	8-K
Amendment Flag	false
Document Period End Date	Dec. 21, 2023
Entity File Number	001-40409
Entity Registrant Name	GROM SOCIAL ENTERPRISES, INC.
Entity Central Index Key	0001662574
Entity Tax Identification Number	46-5542401
Entity Incorporation, State or Country Code	FL
Entity Address, Address Line One	2060 NW Boca Raton Blvd., Suite #6
Entity Address, City or Town	Boca Raton
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33431
City Area Code	(561)
Local Phone Number	287-5776
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Common Stock [Member]
Title of 12(b) Security	Common Stock, par value $0.001
Trading Symbol	GROM
Security Exchange Name	NASDAQ
Warrant [Member]
Title of 12(b) Security	Warrants
Trading Symbol	GROMW
Security Exchange Name	NASDAQ