GDC · GD Culture Group Limited

The ATM agreement represents a strategic financing tool that allows GD Culture Group Limited to access equity capital flexibly and incrementally, aligned with market conditions and funding needs—without the dilutive impact or pricing uncertainty of a traditional follow-on offering. Unlike a firm-commitment underwriting, this arrangement imposes no obligation on the sales agent to sell shares; instead, the Company retains full control over timing, volume, and pricing via Transaction Notices, enabling it to avoid issuing stock during periods of depressed valuation or volatility. The $300 million ceiling reflects significant capacity—approximately 1.8x the reported $166.7 million public float as of January 30, 2026—suggesting the Company anticipates substantial near-to-medium term capital requirements, likely tied to its AI interactive novel platform (Fato) commercialization and scaling efforts disclosed in Exhibit 99.1. The 3.5% commission is within typical ATM ranges but meaningfully impacts net proceeds, especially at lower trading volumes; however, the agreement explicitly excludes principal risk for the agent, reinforcing its role as a pure sales conduit. Regulatory readiness is confirmed by the March 18, 2026 effectiveness of the underlying Form S-3 (File No. 333-292934), and the inclusion of customary legal opinions (Exhibit 5.1) and comfort letters underscores compliance rigor. Critically, the agreement contains no covenants restricting future financings or operations, and termination rights preserve strategic optionality—though repeated non-execution could signal execution risk or deteriorating investor appetite. For investors, this filing signals both financial preparedness and operational ambition, but also introduces potential dilution pressure if executed aggressively amid weak share performance.