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Item 1. Financial Statements

2020-05-11 compared with 2019-11-14 · 1517 added, 951 removed, 32 unchanged (99% of the section changed)

Financial Statements.

TKK SYMPHONY ACQUISITION CORPORATION

CONDENSED BALANCE SHEETS

September 30,

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

CONDENSED CONSOLIDATED BALANCE SHEETS

dollars in thousands, except share and per share data)

Current assets:

Prepaid expenses

Cash and cash equivalents

Accounts receivable, net

Prepayment and other current assets

Total current assets

Marketable securities held in Trust Account

$ 256,409,142

$ 252,412,991

LIABILITIES AND SHAREHOLDERS’

Current Liabilities –

Accounts payable and accrued expenses

Property and equipment, net

Intangible assets, net

Deferred tax assets

Unamortized produced content, net

Right-of-use assets

Total non-current assets

Liabilities and Equity

Current liabilities:

Short-term bank loans

Accounts payable

Advances from customers

Accrued liabilities and other payables

Other taxes payable

Operating lease liabilities -current

Due to related parties

Convertible promissory note - related party

Total current liabilities

Convertible promissory note –

related party

Long-term bank loan

Operating lease liabilities - non-current

Total non-current liabilities

TOTAL LIABILITIES

Ordinary shares subject to possible redemption, 24,421,453 and 24,553,676 shares at redemption value at September 30, 2019 and December 31, 2018, respectively

Commitments and contingences

Shareholders’

Preferred shares, $0.0001 par value;

Preferred shares (par value of $0.0001 per share;

2,000,000 authorized;

none issued and outstanding)

Ordinary shares, $0.0001 par value;

200,000,000 shares authorized;

7,028,547 and 6,896,324 shares issued and outstanding (excluding 24,421,453 and 24,553,676 shares subject to possible redemption) at September 30, 2019 and December 31, 2018, respectively

Ordinary shares (par value of $0.0001 per share;

200,000,000 shares authorized as of December 31, 2019 and March 31, 2020;

41,204,025 and 50,898,866 shares issued and outstanding as of December 31, 2019 and March 31, 2020, respectively)

Additional paid-in capital

Statutory reserve

Retained earnings

Total Shareholders’

TOTAL LIABILITIES AND SHAREHOLDERS’

$ 256,409,142

$ 252,412,991

The accompanying notes are an integral part

of the unaudited condensed financial statements.

TKK SYMPHONY ACQUISITION CORPORATION

CONDENSED STATEMENTS OF OPERATIONS

Three Months Ended

September 30,

For the Period

from February 5, 2018

September 30,

Operating costs

Loss from operations

Other income:

Interest income on marketable securities held in Trust Account

Unrealized loss on marketable securities held in Trust Account

Weighted average shares outstanding, basic and diluted (1)

Basic and diluted net loss per ordinary share (2)

Excludes an aggregate of 24,421,543 and 24,568,336 shares subject to possible redemption at September 30, 2019 and 2018.

ordinary share –

basic and diluted excludes income attributable to ordinary shares subject to possible redemption of

$1,214,055 and $4,298,499 for the three and nine months ended September 30, 2019, respectively, and $428,034 for each of the

three months ended September 30, 2018 and for the period from February 5, 2018 (inception) through September 30, 2018 (see

Accumulated other comprehensive loss

TOTAL GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED SHAREHOLDERS’

Non-controlling interest

TOTAL LIABILITIES AND EQUITY

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

dollars in thousands, except share and per share data)

For the Three Months Ended

Operating expenses:

Cost of revenues

Selling and marketing

General and administrative

Research and development

Total operating expenses

Income from operations

Other (expenses) income:

Interest expense, net

Other (expenses) income, net

Total other expenses

Income before income tax

Income tax (expense) benefit

net loss attributable to non-controlling interests

Net income attributable to Glory Star New Media Group Holdings Limited’s shareholders

Other comprehensive income (loss)

Unrealized foreign currency translation gain (loss)

Comprehensive income

comprehensive loss attributable to non-controlling interests

Comprehensive income attributable to Glory Star New Media Group Holdings Limited’s shareholders

Earnings per ordinary share

Weighted average shares used in calculating earnings per ordinary share

Earnings per ordinary share

Weighted average shares used in calculating earnings per ordinary share

The accompanying notes are an integral part

of the unaudited condensed financial statements.

TKK SYMPHONY ACQUISITION CORPORATION

CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’

THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019

of these unaudited condensed consolidated financial statements.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’

dollars in thousands, except share and per share data)

Preferred shares

Ordinary shares

comprehensive

shareholders’

Balance –

January 1, 2019

Change in value of ordinary shares subject to possible redemption

Balance –

March 31, 2019

Change in value of ordinary shares subject to possible redemption

Balance –

June 30, 2019

Change in value of ordinary shares subject to possible redemption

Balance –

September 30, 2019

FOR THE PERIOD FROM FEBRUARY 5, 2018 (INCEPTION) THROUGH

SEPTEMBER 30, 2018

(loss) income

Balance as of December 31, 2018

Accretion of mezzanine equity

Foreign currency translation adjustment

Balance as of March 31, 2019

Preferred shares

Ordinary shares

comprehensive

shareholders’

Balance –

February 5, 2018 (inception)

Founder Shares issued to Sponsor

Balance –

March 31, 2018

Collection of share subscription receivable

Balance –

June 30, 2018

Sale of 25,000,000 Units, net of underwriting discounts and offering expenses

Sale of 13,000,000 Private Placement Warrants

Forfeiture of Founder Shares

Issuance of Representative Shares

Ordinary shares subject to possible redemption

(24,568,336 )

(246,108,950 )

(246,111,408 )

Balance –

September 30, 2018

Balance as of December 31, 2019

Reverse recapitalization

Issuance of shares to three independent directors

Issuance of shares for the services rendered

Issuance of shares for the conversion of rights

Foreign currency translation adjustment

Balance as of March 31, 2020

The accompanying notes are an integral part

of the unaudited condensed financial statements.

TKK SYMPHONY ACQUISITION CORPORATION

CONDENSED STATEMENTS OF CASH FLOWS

Nine Months Ended

September 30,

For the Period

from February 5, 2018

September 30,

of these unaudited condensed consolidated financial statements.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

dollars in thousands)

Three Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

Adjustments to reconcile net income to net cash used in operating activities:

Interest earned on securities held in Trust Account

Unrealized loss on securities held in Trust Account

Changes in operating assets and liabilities:

Accounts payable and accrued expenses

Prepaid expenses

Net cash used in operating activities

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

(Reversal of allowance) allowance for doubtful accounts

Depreciation and amortization

Amortization of right-of-use assets

Deferred income tax expense (benefit)

Share base compensation

Changes in assets and liabilities

Accounts receivable

Prepayment and other current assets

Unamortized produced content

Accounts payable

Advances from customers

Accrued liabilities and other payables

Other taxes payable

Operating lease liabilities

Net cash provided by (used in) operating activities

CASH FLOWS FROM INVESTING ACTIVITIES:

Investment of cash in Trust Account

(250,000,000 )

Purchase of property and equipment

Prepayments for acquisition of intangible assets

Net cash used in investing activities

(250,000,000 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of ordinary shares to Sponsor

Proceeds from sale of Units, net of underwriting discounts paid

Proceeds from sale of Private Placement Warrants

Advances from related party

Repayment of advances from related party

Proceeds from promissory note –

related party

Proceeds from convertible promissory note –

related party

Repayment of promissory note –

Proceeds from bank loans

Repayments of bank loans

Proceeds from a third party

Cash acquired from the acquisition of TKK

Net cash (used in) provided by financing activities

Effect of exchange rate changes

Net (decrease) increase in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash, at beginning of year

Cash, cash equivalents and restricted cash, at end of year

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Interests paid

Right of use assets obtained in exchange for operating lease obligations

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO UNAUDITD CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

ORGANIZATION AND PRINCIPAL ACTIVITIES

Organization and General

Glory Star New Media

Group Holdings Limited (“GS Holdings”, or the “Company”), was a blank check company incorporated in the

Cayman Islands on February 5, 2018 under the former name TKK Symphony Acquisition Corporation (“TKK”).

was formed for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization

or other similar business combination with one or more businesses or entities.

The registration statements for TKK’s Initial

Public Offering (“Initial Public Offering”) were declared effective on August 15, 2018.

Reverse recapitalization

On February 14, 2020,

GS Holdings consummated the transaction (the “Business Combination”) contemplated by the Share Exchange Agreement dated

as of September 6, 2019, as amended (“Share Exchange Agreement”), by and among the Company, Glory Star New Media Group

Limited, a Cayman Islands exempted company (“Glory Star”), Glory Star New Media (Beijing) Technology Co., Ltd., a wholly

foreign-owned enterprise limited liability company (“WFOE”) incorporated in the People’s Republic of China (“PRC”)

and indirectly wholly-owned by Glory Star, Xing Cui Can International Media (Beijing) Co., Ltd., a limited liability company incorporated

in the PRC (“Xing Cui Can”), Horgos Glory Star Media Co,.

(“Horgos”), a limited liability company

incorporated in the PRC, each of Glory Star’s shareholders (collectively, the “Sellers”), TKK Symphony Sponsor

1, the Company’s sponsor (the “Sponsor”), in the capacity as the representative from and after the closing of

the Business Combination for GS Holdings’

shareholders other than the Sellers, and Bing Zhang, in the capacity as the representative

for the Sellers thereunder, pursuant to which GS Holdings acquired 100% of the equity interests of Glory Star from the Sellers.

As a result of the Business Combination, Sellers became the controlling shareholders of the Company.

The Business Combination was

accounted for as a reverse merger, wherein Glory Star is considered the acquirer for accounting and financial reporting purposes and

the transaction was treated as a recapitalization of Glory Star.

Upon closing of the

Business Combination (the “Closing”), the Company acquired all of the issued and outstanding securities of Glory Star

in exchange for (i) 41,204,025 of the Company’s ordinary shares (“Closing Payment Shares”), of which 2,060,201

of the Closing Payment Shares shall be deposited into escrow to secure certain indemnification obligations of the Sellers, plus

(ii) earnout payments consisting of up to an additional 5,000,000 of the Company’s ordinary shares if the Company meet certain

financial performance targets for the 2019 fiscal year and an additional 5,000,000 of the Company’s ordinary shares if the

Company meet certain financial performance targets for the 2020 fiscal year (the “Earnout Shares”).

In the event that

a financial performance target is not met for the 2019 fiscal year and/or 2020 fiscal year but the Company meet certain financial

performance targets for the 2019 fiscal year and 2020 fiscal year combined, the Sellers will be entitled to receive any Earnout

Shares that they otherwise did not receive.

After giving effect

to the Business Combination and the issuance of the Closing Payment Shares described above, there are 49,767,866 of the Company’s

ordinary shares issued and outstanding.

The Business Combination

is treated by TKK as a reverse merger under the acquisition method of accounting in accordance with GAAP.

For accounting purposes,

Glory Star is considered to be acquiring TKK in this transaction.

Therefore, the aggregate consideration paid in connection with

the business combination will be allocated to TKK’s tangible and intangible assets and liabilities based on their fair market

The assets and liabilities and results of operations of TKK will be consolidated into the results of operations of Glory

Star as of the completion of the Business Combination.

Reorganization of Glory Star Group

On November 30, 2018,

Glory Star was incorporated as an exempted company with limited liability under the laws of the Cayman Islands.

On December 18, 2018,

Glory Star New Media Group HK Limited (“Glory Star HK”) was established as a wholly-owned subsidiary formed in accordance

with laws and regulations of Hong Kong.

Glory Star HK is a holding company and holds all the equity interests of Glory Star New

Media (Beijing) Technology Co., Ltd.(“WFOE”), which was established in the PRC on March 13, 2019.

Xing Cui Can was incorporated

in Beijing on September 7, 2016 under the laws of the People’s Republic of China (“PRC”

or “China”).

It is a holding company with no business operation.

Horgos was incorporated

in Horgos Economic District, Xinjiang province, China on November 1, 2016 under the laws of the People’s Republic of China

(“PRC”

or “China”).

Horgos is a leading provider and operator of premium lifestyle content through mobile

internet in China.

Horgos formed some subsidiaries

in PRC at the following dates:

Glory Star Media (Beijing) Co., Ltd.

(“Glory Star Beijing”), a company incorporated on December 9, 2016 in Beijing is wholly owned by Horgos.

Leshare Star (Beijing) Technology Co., Ltd.

(“Beijing Leshare”), a company incorporated on March 28, 2016 in Beijing is wholly owned by Horgos.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

ORGANIZATION AND PRINCIPAL ACTIVITIES (cont.)

Horgos Glary Prosperity Culture Co., Ltd.

(“Glary Prosperity”), was incorporated on December 14, 2017 in Horgos Economic District, Xinjiang province and 51% of its shareholding was acquired by Horgos.

Horgos Glary Wisdom formed a branch of Horgos Glary Prosperity Culture Co., Ltd.

Beijing Branch (“Glary Prosperity Beijing Branchy”) on May 8, 2018.

Shenzhen Leshare Investment Co., Ltd.

(“Shenzhen Leshare”), a company incorporated on June 27, 2018 in ShenZhen, Guangdong province is wholly owned by Horgos.

Shenzhen Leshare is dormant as of December 31, 2018.

Horgos Glary Wisdom Marketing Planning Co., Ltd.

(“Horgos Glary Wisdom”) was incorporated on June 13, 2018 in Horgos Economic District, Xinjiang province and 51% of its shareholding was acquired by Horgos.

Horgos Glary Wisdom formed a subsidiary as Glary Wisdom (Beijing) Marketing Planning Co., Ltd.

(“Beijing Glary Wisdom”) on September 10, 2018.

In September 2019, WFOE

has entered into a series of contractual arrangements with (i) Xing Cui Can and its shareholders, and (ii) Horgos and its shareholders,

which allow Glory Star to exercise effective control over Xing Cui Can and Horgos and receive substantially all the economic benefits

of Xing Cui Can and Horgos (the “VIEs”).

These contractual agreements include Business Cooperation Agreement, Exclusive

Option Agreement, Share Pledge Agreement, Proxy Agreement and Power of Attorney and Master Exclusive Service Agreement (collectively

“VIEs Agreements”).

Glory Star together with its wholly-owned subsidiary Glory Star HK and WFOE and its VIEs and VIEs’

subsidiaries were effectively controlled by the same shareholders after the reorganization.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of presentation

The accompanying consolidated

financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”).

The consolidated financial statements include the financial statements of the Company, its subsidiaries, its VIEs

and its VIEs’

subsidiaries.

All inter-company transactions and balances have been eliminated upon consolidation.

(b) Use of estimates

The preparation of financial

statements in conformity with U.S.

GAAP requires to make estimates and assumptions that affect the reported amounts of assets and

liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts

of revenues and expenses during the reporting period and accompanying notes, including allowance for doubtful accounts, allowance

for unamortized production content, the useful lives of property and equipment and intangible assets, impairment of long-lived

assets, valuation allowance for deferred tax assets and revenue recognition.

Actual results could differ from those estimates.

The Company applies

ASC Topic 820, Fair Value Measurements and Disclosures which defines fair value, establishes a framework for measuring fair value

and expands financial statement disclosure requirements for fair value measurements.

ASC Topic 820 defines

fair value as the price that would be received from the sale of an asset or paid to transfer a liability (an exit price) on the

measurement date in an orderly transaction between market participants in the principal or most advantageous market for the asset

or liability.

ASC Topic 820 specifies

a hierarchy of valuation techniques, which is based on whether the inputs into the valuation technique are observable or unobservable.

The hierarchy is as follows:

Level 1 inputs to the

valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 inputs to the

valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable

for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.

Level 3 inputs to the

valuation methodology are unobservable and significant to the fair value.

Unobservable inputs are valuation technique inputs that

reflect the Company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Management of the Company

is responsible for considering the carrying amount of cash and cash equivalents, accounts receivable, prepayment and other current

assets, short-term bank loans, accounts payable, advances from customers, accrued liabilities and other payables and other taxes

payable based on the short-term maturity of these instruments to approximate their fair values because of their short-term nature.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

(d) Accounts Receivable, net

Accounts receivable

represent the amounts that the Company has an unconditional right to consideration (including billed and unbilled amount) when

the Company has satisfied its performance obligation.

The Company does not have any contract assets since revenue is recognized

when control of the promised services is transferred and the payment from customers is not contingent on a future event.

maintains allowance for potential credit losses on accounts receivable.

Management reviews the composition of accounts receivable

and analyses historical bad debt, customer concentrations, customer credit worthiness, current economic trends and changes in customer

payment patterns to estimate the allowance.

Past due accounts are generally written off against the allowance for bad debts only

after all collection attempts have been exhausted and the potential for recovery is considered remote.

(e) Unamortized produced content

Produced content includes

direct production costs, production overhead and acquisition costs and is stated at the lower of unamortized cost or estimated

Produced content also includes cash expenditures made to enter into arrangements with third parties to co-produce certain

of its productions.

The Company uses the

individual-film-forecast-computation method and amortizes the produced content based on the ratio of current period actual revenue

(numerator) to estimated remaining unrecognized ultimate revenue as of the beginning of the fiscal year (denominator) in accordance

with ASC 926.

Ultimate revenue estimates for the produced content are periodically reviewed and adjustments, if any, will result

in prospective changes to amortization rates.

When estimates of total revenues and other events or changes in circumstances indicate

that a film or television series has a fair value that is less than its unamortized cost, a loss is recognized currently for the

amount by which the unamortized cost exceeds the film or television series’

For the three months ended March

31, 2019 and 2020, $3,430 and $3,369 were amortized to the cost of sales, and as of December 31, 2019 and March 31, 2020, no impairment

allowance was recorded.

(f) Intangible asset, net

Intangible asset is

stated at cost less accumulated amortization and amortized in a method which reflects the pattern in which the economic benefits

of the intangible asset are expected to be consumed or otherwise used up.

The balance of intangible asset represents software related

to CHEERS App, a mobile application that allows its users to access its online store (e-Mall), video content, live streaming, and

online games.

The software is acquired externally tailored to the Company’s requirements and is amortized straight-line over

7 years in accordance with the way the Company estimates to generate economic benefits from such software.

(g) Impairment of Long-lived Assets

In accordance with ASC

Topic 360, the Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying

amount of the assets may not be fully recoverable, or at least annually.

The Company recognizes an impairment loss when the sum

of expected undiscounted future cash flows is less than the carrying amount of the asset.

The amount of impairment is measured

as the difference between the asset’s estimated fair value and its book value.

The Company did not record any impairment

charge for the three months ended March 31, 2019 and 2020.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

(h) Revenue Recognition

The Company early adopted

the new revenue standard Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, on January

The core principle of this new revenue standard is that a company should recognize revenue to depict the transfer of promised

goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange

for those goods or services.

The following five steps are applied to achieve that core principle:

Identify the contract with the customer

Identify the performance obligations in the

Determine the transaction price

Allocate the transaction price to the performance

obligations in the contract

Recognize revenue when the company satisfies

a performance obligation

The Company mainly offers

and generates revenue from the copyright licensing of self-produced content, advertising and customized content production and

Revenue recognition policies are discussed as follows:

The Company self produces

or coproduces TV series featuring lifestyle, culture and fashion, and licenses the copyright of the TV series on an episode basis

to the customer for broadcast over a period of time.

Generally, the Company signs a contract with a customer which requires the

Company to deliver a series of episodes that are substantially the same and that have the same pattern of transfer to the customer.

Accordingly, the delivery of the series of episodes is defined as the only performance obligation in the contract.

For the TV series produced

solely by the Company, the Company satisfies its performance obligation over time by measuring the progress toward the delivery

of the entire series of episodes which is made available to the licensee for exhibition after the license period has begun.

the copyright revenue in a contract is recognized over time based on the progress of the number of episodes delivered.

The Company also coproduces

TV series with other producers and licenses the copyright to third-party video broadcast platforms for broadcast.

For TV series

produced by Glory Star Group with co-producers, the Company satisfies its performance obligations over time by the delivery of

the entire series of episodes to the customer, and requires the customer to pay consideration based on the number and the unit

price of valid subsequent views of the TV series that occur on a broadcast platform.

Therefore, the copyright revenue is recognized

when the later of the valid subsequent view occurs or the performance obligation relating to the delivery of a number of episodes

has been satisfied.

Advertising revenue

The Company generates

revenue from sales of various forms of advertising on its TV series and streaming content by way of 1) advertisement displays,

or 2) the integration of promotion activities in TV series and content to be broadcast.

Advertising contracts are signed to establish

the different contract prices for different advertising scenarios, consistent with the advertising period.

The Company enters into

advertising contracts directly with the advertisers or the third-party advertising agencies that represent advertisers.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

(h) Revenue Recognition (cont.)

For the contracts that

involve the third-party advertising agencies, the Company is principal as the Company is responsible for fulfilling the promise

of providing advertising services and has the discretion in establishing the price for the specified advertisement.

Under a framework

contract, the Company receives separate purchase orders from advertising agencies before the broadcast.

Accordingly, each purchase

order is identified as a separate performance obligation, containing a bundle of advertisements that are substantially the same

and that have the same pattern of transfer to the customer.

Where collectability is reasonably assured, revenue is recognized monthly

over the service period of the purchase order.

For contracts signed

directly with the advertisers, the Company commits to display a series of advertisements which are substantially the same or similar

in content and transfer pattern, and the display of the whole series of advertisements is identified as the single performance

obligation under the contract.

The Company satisfies its performance obligations over time by measuring the progress toward the

display of the whole series of advertisements in a contract, and advertising revenue is recognized over time based on the number

of advertisements displayed.

Payment terms and conditions

vary by contract types, and terms typically include a requirement for payment within a period from 3 to 6 months.

Both direct advertisers

and third-party advertising agencies are generally billed at the end of the display period and require the Company to issue VAT

invoices in order to make their payments.

However, because the

local government tax authority uses a quota system to manage the VAT tax, it normally either delays the VAT invoices issued or

does not issue sufficient VAT invoices.

As such, the Company is not able to provide sufficient VAT invoices on a timely manner

and results in increased account receivables.

Customized content production revenue

The Company produces

customized short streaming videos according to its customers’

requirement, and earns fixed fees based on delivery.

is recognized upon the delivery of short streaming videos.

CHEERS E-mall marketplace service revenue

The Company through

CHEERS E-mall, an online e-commerce platform, enables third-party merchants to sell their products to consumers in China.

charges fees for platform services to merchants for sales transactions completed on the Cheer E-Mall including but not limited

to products displaying, promotion and transaction settlement services.

The Company does not take control of the products provided

by the merchants at any point in the time during the transactions and does not have latitude over pricing of the merchandise.

services fee is determined as the difference between the platform sales price and the settlement price with the merchants.

E-mall marketplace service revenue is recognized at a point of time when the Company’s performance obligation to provide

marketplace services to the merchants are determined to have been completed under each sales transaction upon the consumers confirming

the receipts of goods.

Payments for services are generally received before deliveries.

The Company provides

coupons to consumers at our own discretion as incentives to promote CHEERS E-mall marketplace with validity usually around or less

than one week, which can only be used in future purchases of eligible merchandise offered on CHEERS E-mall to reduce purchase price

that are not specific to any merchant.

Consumers are not customers of the Company, therefore incentives offered to consumers are

not considered consideration payable to customers.

As the consumers are required to make future purchases of the merchants’

merchandise to redeem these coupons, the Company does not accrue any expense for coupons when granted and recognizes the amounts

of redeemed coupons as marketing expenses when future purchases are made.

Other Revenues

Other revenue primarily

consists of copyrights trading of purchased and produced TV-series and the sales of products on Taobao platform.

For copyright

licensing of purchased and produced TV-series, the Company recognize revenue on net basis at a point of time upon the delivery

of master tape and authorization of broadcasting right.

For sales of product, the company recognize revenue upon the transfer of

products according to the fixed price and production amount in sales orders.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

(h) Revenue Recognition (cont.)

The following table

identifies the disaggregation of our revenue for the three months ended March 31, 2019 and 2020, respectively:

For the three months ended

Category of Revenue:

Advertising revenue

Copyrights revenue

Customized content production revenue

CHEERS E-mall marketplace service revenue

Other revenue

Timing of Revenue Recognition:

Services transferred over time

Services transferred at a point in time

Goods transferred at a point in time

The Company applied

a practical expedient to expense costs as incurred for costs to obtain a contract with a customer when the amortization period

would have been one year or less.

The Company does not have any significant incremental costs of obtaining contracts with customers

incurred and/or costs incurred in fulfilling contracts with customers within the scope of ASC Topic 606, that shall be recognized

as an asset and amortized to expenses in a pattern that matches the timing of the revenue recognition of the related contract.

(i) Earnings per Share

The Company computes

earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share”

(“ASC 260”).

260 requires companies with complex capital structures to present basic and diluted EPS.

Basic EPS is measured as net income/(loss)

attributable to ordinary shareholders divided by the weighted average common shares outstanding for the period.

Diluted EPS is

similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., convertible securities,

earnout shares and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later.

Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share)

are excluded from the calculation of diluted EPS.

There is no anti-dilutive effect for the three months ended March 31, 2019 and

(j) Recent Accounting Pronouncements

In June 2016, the FASB

issued ASU No.

2016-13, “Measurement of Credit Losses on Financial Instruments (Topic 326)”, which significantly changes

the way entities recognize impairment of many financial assets by requiring immediate recognition of estimated credit losses expected

to occur over their remaining life, instead of when incurred.

In November 2018, the FASB issued ASU No.

2018-19, “Codification

Improvements to Topic 326, Financial Instruments—Credit Losses”, which amends Subtopic 326-20 (created by ASU No.2016-13)

to explicitly state that operating lease receivables are not in the scope of Subtopic 326-20.

Additionally, in April 2019, the

FASB issued ASU No.2019-04, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815,

Derivatives and Hedging, and Topic 825, Financial Instruments”, in May 2019, the FASB issued ASU No.

2019-05, “Financial

Instruments—Credit Losses (Topic 326):

Targeted Transition Relief”, and in November 2019, the FASB issued ASU No.

“Financial Instruments—Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842):

Dates”, and ASU No.

2019-11, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses”,

to provide further clarifications on certain aspects of ASU No.

2016-13 and to extend the nonpublic entity effective date of ASU

The changes (as amended) are effective for the Company for annual and interim periods in fiscal years beginning after

December 15, 2022, and the Company is in the process of evaluating the potential effect on its consolidated financial statements.

In December 2019, the

FASB issued ASU No.

2019-12, “Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes”

(“ASU 2019-12”),

which is intended to simplify various aspects related to accounting for income taxes.

ASU 2019-12 removes certain exceptions to

the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application.

This guidance

is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption

The Company is currently assessing the impact of adopting this standard, but based on a preliminary assessment, does

not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

Other accounting standards

that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material

impact on the consolidated financial statements upon adoption.

The Company does not discuss recent pronouncements that are not

anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

ACCOUNTS RECEIVABLE, NET

As of December 31, 2019

and March 31, 2020, accounts receivable consisted of the following:

Accounts receivable - gross

Allowance for doubtful accounts

Accounts receivables, net

reversed $39 of bad debt provision for the three months ended March 31, 2019 and recorded bad debt expense of $383 for the three

months ended March 31, 2020, respectively.

PREPAYMENT AND OTHER CURRENT ASSETS

As of December 31, 2019

and March 31, 2020, prepayment and other current assets consisted of the following:

Prepaid production fee

Other prepaid expense

Staff advance

PROPERTY AND EQUIPMENT, NET

As of December 31, 2019

and March 31, 2020, property and equipment consisted of the following:

Electronic equipment

Office equipment and furniture

Leasehold improvement

accumulated depreciation

For the three months

ended March 31, 2019 and 2020, depreciation expense amounted to $59 and $58 respectively.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

INTANGIBLE ASSETS, NET

As of December 31, 2019

and March 31, 2020, intangible assets consisted of the following:

Intangible assets –

accumulated amortization

The balance of intangible

assets mainly represents software related to CHEERS App, primarily consisting e-mall, online game, video media library and data

warehouse modules, etc., acquired externally tailored to the Company’s requirements and is amortized straight-line over 7

years in accordance with the way the Company estimates to generate economic benefits from such software.

For the three months

ended March 31, 2019 and 2020, amortization expense amounted to $2 and $390, respectively.

The following is a schedule, by fiscal

years, of amortization amount of intangible asset as of March 31, 2020:

2020 (remaining)

ACCRUED LIABILITIES AND OTHER PAYABLES

As of December 31, 2019

and March 31, 2020, accrued liabilities and other payables consisted of the following:

Borrowing from former shareholder (1)

Co-invest online series production fund

Payroll payables

Other payables

(1) Borrowing from former shareholder

represented the loan from Lead Eastern Investment Co., Ltd, who was the related party of the Company until October 26, 2018.

GLORY STAR NEW MEDIA GROUP HOLDINGS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

OTHER TAXES PAYABLE

As of December 31, 2019

and March 31, 2020, other taxes payable consisted of the following:

Business tax payable

Bank loans represent

the amounts due to various banks that are due within and over one year.

As of December 31, 2019 and March 31, 2020, bank loans consisted of the following:

Short-term bank loans:

Loan from Bank of Beijing (1)

Loan from China Merchants Bank (2)

Loan from Huaxia Bank (3)

Long-term bank loans:

Loan from Huaxia Bank (3)

(1) On December 18, 2019, Glory

Star Beijing entered into a loan agreement with Bank of Beijing to borrow $718 as working capital for one year, with maturity

date of December 18, 2020.

The loan bears a fixed interest rate of 5.22% per annum.

The loan is guaranteed by Beijing Haidian

Sci-tech Enterprises Financing Guarantee Co., Ltd, for whom a counter-guarantee was provided by Horgos and Mr.

Zhang Bing, the

Chairman of the Company’s board of directors.

As of March 31, 2020, the outstanding balance was $706.

(2) In December 2019, Glory Star

Beijing entered into a two-year credit facility agreement of maximum $1,412 with China Merchants Bank.

On January 6, 2020, Glory

Star Beijing made a withdraw of $1,412), which will be due on January 5, 2021.

In March 2020, Glory Star Beijing entered into

another two-year credit facility agreement of maximum $1,412 with China Merchants Bank.

On March 27, 2020, Glory Star Beijing

made a withdraw of $1,412), which will be due on March 26, 2021.

Both two loans bear a fixed interest rate of 4.785% per annum.

The loans are guaranteed by Beijing Zhongguancun Sci-tech Financing Guarantee Co., Ltd, for whom a counter guarantee was provided

by Horgos, Mr.

Zhang Bing, the Chairman of the Company’s board of directors, and Mr.

Lu Jia, the Vice President of the Company.

In March, 2020, Glory Star Beijing entered into a two-year credit facility agreement of maximum $1,413 with Huaxia Bank.

On March 23, 2020, Glory Star Beijing made a withdrawal of $1,413, $142 of which will be due on March 21, 2021 and the remaining of $1,271 will be due on March 23, 2022.

The loan bears a fixed interest rate of 6.09% per annum.

The loan is guaranteed by Beijing Haidian Sci-tech Enterprises Financing Guarantee Co., Ltd.

Horgos provided counter-guarantee to Beijing Haidian Sci-tech Enterprises Financing Guarantee Co., Ltd with accounts receivable from Beijing iQYI Technology Co., Ltd.

pledged as collateral and Mr.

Zhang Bing, the Chairman of the Company’s board of directors, provided the second guarantee.

The weighted average interest

rate for short-term bank loans was approximately 5.58% and 5.00% for the three months ended March 31, 2019 and 2020, respectively.

For the three months ended March 31, 2019 and 2020, interest expense related to bank loans amounted to $151 and $26 respectively.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

The Company leases offices

space under non-cancelable operating leases, with terms ranging from one to five years.

The Company considers those renewal or

termination options that are reasonably certain to be exercised in the determination of the lease term and initial measurement

of right of use assets and lease liabilities.

Lease expense for lease payment is recognized on a straight-line basis over the lease

Leases with initial term of 12 months or less are not recorded on the balance sheet.

The Company determines

whether a contract is or contains a lease at inception of the contract and whether that lease meets the classification criteria

of a finance or operating lease.

When available, the Company uses the rate implicit in the lease to discount lease payments to

present value;

however, most of the Company’s leases do not provide a readily determinable implicit rate.

Therefore, the

Company discount lease payments based on an estimate of its incremental borrowing rate.

The Company’s

lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Supplemental balance sheet information related

to operating lease was as follows:

Right-of-use assets

Operating lease liabilities - current

Operating lease liabilities - non-current

Total operating lease liabilities

The weighted average remaining lease

terms and discount rates for the operating lease were as follows as of March 31, 2020:

Remaining lease term and discount rate:

Weighted average remaining lease term (years)

Weighted average discount rate

For the three months

ended March 31, 2019 and 2020, the Company incurred total operating lease expenses of $122 and $126, respectively.

The following is a schedule, by fiscal years,

of maturities of lease liabilities as of March 31, 2020:

2020 (remaining)

Total lease payments

imputed interest

Present value of lease liabilities

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

RELATED PARTY TRANSACTIONS

Amounts due to Related Parties

As of December 31, 2019

and March 31, 2020, amounts due to related parties consisted of the following:

Zhang Bing (1)

Chairman of the Company’s board of directors and CEO of the Company

Board member and vice president of the Company.

The balances of $1,525

and $1,499 a s of December 31, 2019 and March 31, 2020, respectively, were borrowed from related parties for the Company’s

working capital needs.

The balances are short-term in nature, non-interest bearing, unsecured and repayable on demand.

Convertible promissory

related party

Payment of offering costs

Net cash provided by financing activities

Net change in cash

Cash at beginning of period

Cash at end of period

Non-cash investing and financing activities:

Initial classification of ordinary shares subject to possible redemption

$ 245,739,860

Change in value of ordinary shares subject to redemption

Conversion of advances from related party to convertible promissory note

The accompanying notes are an integral part

of the unaudited condensed financial statements.

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS

TKK Symphony Acquisition Corporation (the

“Company”) is a blank check company incorporated in the Cayman Islands on February 5, 2018.

The Company was formed

for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization

or other similar business combination with one or more businesses or entities (a “Business Combination”).

is not limited to a particular industry or geographic region for purposes of consummating a Business Combination.

Company believes it is particularly well-positioned to capitalize on growing opportunities created by consumer/lifestyle assets

that may have particular application for the People’s Republic of China market.

At September 30, 2019, the Company had

not yet commenced any operations.

All activity through September 30, 2019 relates to the Company’s formation, its initial

public offering (“Initial Public Offering”), which is described below, identifying a target company for a Business

Combination and the proposed acquisition of Glory Star New Media Group Limited, a Cayman Islands exempted company (“Glory

Star”) (see Note 6).

The registration statements for the Company’s

Initial Public Offering were declared effective on August 15, 2018.

On August 20, 2018, the Company consummated the Initial Public

Offering of 22,000,000 units (“Units”

and, with respect to the ordinary shares included in the Units offered, the “Public

Shares”), generating total gross proceeds of $220,000,000, which is described in Note 3.

Simultaneously with the closing of the

Initial Public Offering, the Company consummated the sale of an aggregate of 11,800,000 warrants (the “Private Placement

Warrants”) at a price of $0.50 per warrant in a private placement to Symphony Holdings Limited, generating total gross proceeds

of $5,900,000, which is described in Note 4.

Following the closing of the Initial Public

Offering on August 20, 2018, an amount of $220,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the

Initial Public Offering and the sale of the Private Placement Warrants was placed in a trust account (“Trust Account”)

which may be invested in U.S.

government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company

Act of 1940, as amended (the “Investment Company Act”), with a maturity of 180 days or less or in any open-ended investment

company that holds itself out as a money market fund selected by the Company meeting the conditions of Rule 2a-7 of the Investment

Company Act, as determined by the Company, until the earlier of:

(i) the consummation of a Business Combination or (ii) the distribution

of the Trust Account, as described below.

On August 22, 2018, in connection with

the underwriters’

partial exercise of their over-allotment option, the Company consummated the sale of an additional 3,000,000

Units at $10.00 per Unit and the sale of an additional 1,200,000 Private Placement Warrants $0.50 per Private Placement Warrants,

generating total gross proceeds of $30,600,000.

A total of $30,000,000 of the net proceeds were deposited in the Trust Account,

bringing the aggregate proceeds held in the Trust Account to $250,000,000.

Transaction costs amounted to $5,744,938,

consisting of $5,000,000 of underwriting fees and $744,938 of offering costs.

As of September 30, 2019, $47,270 of cash was held

outside of the Trust Account and is available for working capital purposes.

The Company’s management has broad

discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private

Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business

The Company’s initial Business Combination must be with one or more target businesses that together have a fair

market value equal to at least 80% of the balance in the Trust Account (excluding taxes payable on income earned on the Trust Account)

at the time of the signing of an agreement to enter into a Business Combination.

The Company will only complete a Business Combination

if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise

acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the

Investment Company Act.

There is no assurance that the Company will be able to successfully effect a Business Combination.

The Company will provide its shareholders

with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i)

in connection with a shareholder meeting called to approve the Business Combination or (ii) by means of a tender offer.

as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the

Company, solely in its discretion.

The shareholders will be entitled to redeem their Public Shares for a pro rata portion of the

amount then on deposit in the Trust Account ($10.00 per share, plus any pro rata interest earned on the funds held in the Trust

Account and not previously released to the Company to pay its tax obligations).

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

The Company will proceed with a Business

Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and,

if the Company seeks shareholder approval, a majority of the outstanding shares voted are voted in favor of the Business Combination.

If a shareholder vote is not required and the Company does not decide to hold a shareholder vote for business or other legal reasons,

the Company will, pursuant to its Amended and Restated Memorandum and Articles of Association, offer such redemption pursuant to

the tender offer rules of the Securities and Exchange Commission (“SEC”), and file tender offer documents containing

substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination.

TKK Symphony Sponsor 1 (the “Sponsor”)

and the other initial shareholders (collectively, the “Initial Shareholders”) have agreed (a) to vote their Founder

Shares (as defined in Note 5), and any Public Shares purchased during or after the Initial Public Offering in favor of a Business

(b) not to propose, or vote in favor of, an amendment to the Company’s Amended and Restated Memorandum and Articles

of Association with respect to the Company’s pre-Business Combination activities prior to the consummation of a Business

Combination unless the Company provides dissenting public shareholders with the opportunity to redeem their Public Shares in conjunction

with any such amendment;

an extension of the period of time for the Company to consummate a Business Combination, as described in the following paragraph;

(d) not to convert any Founder Shares (as well as any Public Shares purchased during or after the Initial Public Offering) into

the right to receive cash from the Trust Account in connection with a shareholder vote to approve a Business Combination (or sell

any shares in a tender offer in connection with a Business Combination if the Company does not seek shareholder approval in connection

therewith) or a vote to amend the provisions of the Amended and Restated Memorandum and Articles of Association relating to shareholders’

rights or pre-Business Combination activity and (e) that the Founder Shares shall not participate in any liquidating distributions

upon winding up if a Business Combination is not consummated.

However, the Initial Shareholders will be entitled to liquidating

distributions from the Trust Account with respect to any Public Shares purchased during or after the Initial Public Offering if

the Company fails to complete its Business Combination.

The Company has until February 20, 2020

to consummate a Business Combination.

However, if the Company anticipates that it may not be able to consummate a Business Combination

by February 20, 2020, the Company may, by resolution of the Company’s Board of Directors, extend the period of time to consummate

a Business Combination for no more than four months (the “Combination Period”).

In order to extend the time available

for the Company to consummate a Business Combination, the Company must issue to the holders of record of its Public Shares on February

20, 2020 one warrant to purchase one-half of one ordinary per share for an aggregate of up to 25,000,000 warrants.

If the Company is unable to complete a

Business Combination within the Combination Period, it will trigger the automatic winding up, dissolution and liquidation pursuant

to the terms of the Company’s Amended and Restated Memorandum and Articles of Association.

If the Company is forced to liquidate,

the amount in the Trust Account (less the aggregate nominal par value of the shares of the Company’s public shareholders)

under the Companies Law (2018 Revision) of the Cayman Islands (the “Companies Law”) will be treated as share premium

which is distributable under the Companies Law provided that immediately following the date on which the proposed distribution

is proposed to be made, the Company is able to pay the debts as they fall due in the ordinary course of business.

If the Company

is forced to liquidate the Trust Account, the public shareholders would be distributed the amount in the Trust Account calculated

as of the date that is two days prior to the distribution (including any accrued interest, net of taxes payable).

In order to protect the amounts held in

the Trust Account, TKK Capital Holding, an affiliate of the Sponsor, has agreed to be liable to the Company, if and to the extent

any claims by a vendor for services rendered or products sold to the Company, or a prospective target business with which the Company

has discussed entering into a transaction agreement, reduce the amounts in the Trust Account to below $10.00 per share.

This liability

will not apply with respect to any claims by a third party who executed a waiver of any right, title, interest or claim of any

kind in or to any monies held in the Trust Account or to any claims under the Company’s indemnity of the underwriters of

the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the

“Securities Act”).

Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party,

TKK Capital Holding will not be responsible to the extent of any liability for such third-party claims.

The Company will seek to

reduce the possibility that TKK Capital Holding will have to indemnify the Trust Account due to claims of creditors by endeavoring

to have all vendors, service providers, prospective target businesses or other entities with which the Company does business, execute

agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

The Company has principally financed its

operations from inception using proceeds from the sale of its equity securities to its shareholders prior to the Initial Public

Offering and such amount of proceeds from the Initial Public Offering that were placed in an account outside of the Trust Account

for working capital purposes.

As of September 30, 2019, the Company had $47,270 in its operating bank accounts, $256,286,247 in

securities held in the Trust Account to be used for a Business Combination or to repurchase or redeem its ordinary shares in connection

therewith and a working capital deficit of $80,945.

In February 2019, the Sponsor committed

to provide an aggregate of $300,000 in loans to the Company and in April 2019, the Sponsor committed to provide an additional aggregate

amount of $300,000 in loans to the Company.

On September 6, 2019, the Company issued the Sponsor an unsecured promissory note in

a principal amount of up to $1,100,000 (the “Note”) for working capital loans made or to be made by the Sponsor.

Note replaced the above commitments provided by the Sponsor.

Up to $1,000,000 of the loans under the Note may be converted into

As of September 30, 2019, there was $850,000 outstanding under the Note.

Based on the foregoing, the Company believes

it will have sufficient cash to meet its needs through February 20, 2020, its scheduled liquidation date.

SUMMARY OF SIGNIFICANT ACCOUNTING

Basis of Presentation

The accompanying unaudited condensed financial

statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”)

for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities

and Exchange Commission (“SEC”).

Certain information or footnote disclosures normally included in financial statements

prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial

Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial

position, results of operations, or cash flows.

In the opinion of management, the accompanying unaudited condensed financial statements

include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial

position, operating results and cash flows for the periods presented.

The accompanying unaudited condensed financial

statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the period ended December 31,

2018 as filed with the SEC on March 11, 2019, which contains the audited financial statements and notes thereto.

The interim results

for the three and nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for the year

ending December 31, 2019 or for any future interim periods.

Emerging Growth Company

The Company is an “emerging growth

company,”

as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012

(the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable

to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with

the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive

compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory

vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS

Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private

companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of

securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards.

JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply

to non-emerging growth companies but any such election to opt out is irrevocable.

The Company has elected not to opt out of such

extended transition period which means that when a standard is issued or revised and it has different application dates for public

or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies

adopt the new or revised standard.

This may make comparison of the Company’s financial statements with another public company

which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition

period difficult or impossible because of the potential differences in accounting standards used.

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

Use of Estimates

The preparation of financial statements

in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities

and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues

and expenses during the reporting period.

Making estimates requires management to

exercise significant judgment.

It is at least reasonably possible that the estimate of the effect of a condition, situation or

set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate,

could change in the near term due to one or more future confirming events.

Accordingly, the actual results could differ from those

Cash and Cash Equivalents

The Company considers all short-term investments

with an original maturity of three months or less when purchased to be cash equivalents.

The Company did not have any cash equivalents

as of September 30, 2019 and December 31, 2018.

Marketable Securities Held in Trust

At September 30, 2019 and December 31,

2018, the assets held in the Trust Account were substantially held in U.S.

Treasury Bills.

Ordinary Shares Subject to Possible

The Company accounts for its ordinary shares

subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480

“Distinguishing Liabilities from Equity.”

Ordinary shares subject to mandatory redemption are classified as a liability

instrument and are measured at fair value.

Conditionally redeemable ordinary shares (including ordinary shares that feature redemption

rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely

within the Company’s control) are classified as temporary equity.

At all other times, ordinary shares are classified as shareholders’

The Company’s ordinary shares feature certain redemption rights that are considered to be outside of the Company’s

control and subject to occurrence of uncertain future events.

Accordingly, ordinary shares subject to possible redemption are presented

at redemption value as temporary equity, outside of the shareholders’

equity section of the Company’s condensed balance

The Company complies with the accounting

and reporting requirements of ASC 740, “Income Taxes,”

which requires an asset and liability approach to financial

accounting and reporting for income taxes.

Deferred income tax assets and liabilities are computed for differences between the

financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on

enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income.

allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC Topic 740 prescribes a recognition

threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected

to be taken in a tax return.

For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon

examination by taxing authorities.

The Company’s management determined that the Cayman Islands is the Company’s major

tax jurisdiction.

The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense.

As of September 30, 2019 and December 31, 2018, there were no unrecognized tax benefits and no amounts accrued for interest and

The Company is currently not aware of any issues under review that could result in significant payments, accruals or

material deviation from its position.

The Company is considered an exempted Cayman

Islands company and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United

As such, the Company’s tax provision is zero for the period presented.

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

Net Loss per Ordinary Share

Net loss per ordinary share is computed

by dividing net loss by the weighted average number of ordinary shares outstanding for the period.

The Company applies the two-class

method in calculating earnings per share.

Ordinary shares subject to possible redemption at September 30, 2019 and 2018, which

are not currently redeemable and are not redeemable at fair value, have been excluded from the calculation of basic loss per share

since such shares, if redeemed, only participate in their pro rata share of the Trust Account earnings.

The Company has not considered

the effect of (1) warrants sold in the Public Offering and private placement to purchase 19,000,000 ordinary shares and (2) rights

sold in the Initial Public Offering that convert into 2,500,000 ordinary shares in the calculation of diluted loss per share, since

the exercise of the warrants and the conversion of the rights into ordinary shares are contingent upon the occurrence of future

As a result, diluted loss per ordinary share is the same as basic loss per ordinary share for the periods presented.

Reconciliation of Net Loss per Ordinary

The Company’s net income (loss) is

adjusted for the portion of income that is attributable to ordinary shares subject to possible redemption, as these shares only

participate in the earnings of the Trust Account and not the income or losses of the Company.

Accordingly, basic and diluted loss

per ordinary share is calculated as follows:

Three Months Ended

September 30,

Nine Months Ended

September 30,

For the Period

from February 5, 2018 (Inception)

September 30,

Income attributable to ordinary shares subject to possible redemption

Adjusted net loss

Weighted average shares outstanding, basic and diluted

Basic and diluted net loss per ordinary share

Concentration of Credit Risk

Financial instruments that potentially

subject the Company to concentration of credit risk consist of a cash account in a financial institution which, at times may exceed

the Federal depository insurance coverage of $250,000.

At September 30, 2019 and December 31, 2018, the Company had not experienced

losses on this account and management believes the Company is not exposed to significant risks on such account.

Fair Value of Financial Instruments

The fair value of the Company’s assets

and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurements and Disclosures”

(“ASC 820”), approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily

due to their short-term nature.

Recent Accounting Pronouncements

Management does not believe that any recently

issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s

condensed financial statements.

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

INITIAL PUBLIC OFFERING

Pursuant to the Initial Public Offering,

the Company sold 25,000,000 Units at a purchase price of $10.00 per Unit, inclusive of 3,000,000 Units sold to the underwriters

On September 6, 2019, GS Holdings issued

the Sponsor an unsecured promissory note in a principal amount of up to $1,100 (the “Sponsor Note”) for working capital

loans made or to be made by the Sponsor, pursuant to which $350 of previously provided advances were converted into loans under

the Sponsor Note.

The Note bore no interest and was due on the earlier of (i) the consummation of a Business Combination or (ii)

the liquidation of GS Holdings.

Up to $1,000 of the loans under the Sponsor Note could be converted into warrants, each warrant

entitling the holders to receive one half of one ordinary share, at $0.50 per warrant.

In September and October 2019, GS Holdings

received an additional $750 under the Sponsor Note, bringing the total outstanding balance due under the Sponsor Note as of December

31, 2019 to an aggregate of $1,100.

On February 14, 2020, GS Holdings entered

into an amended and restated promissory note with the Sponsor (the “Amended Sponsor Note”) to extend the maturity date

from the closing of the Business Combination to a date that is one year from the closing of the Business Combination.

under the Amended Sponsor Note, TKK granted the Sponsor the right to convert the current outstanding balance of $1,400 under the

Amended Sponsor Note to GS Holdings’

ordinary shares at the conversion price equal to the volume-weighted average price of

GS Holdings’

ordinary shares on Nasdaq or such other securities exchange or securities market on which GS Holdings’

ordinary shares are then listed or quoted, for the ten trading days prior to such conversion date;

provided, however, the conversion

price shall not be less than $5.00.

The Amended Sponsor Note automatically converts into GS Holdings’

ordinary shares on

the maturity date.

Cayman Islands

GS Holdings and Glory

Star are incorporated in the Cayman Islands.

Under the current laws of the Cayman Islands, GS Holdings and Glory Star are not subject

to income or capital gains taxes.

In addition, dividend payments are not subject to withholdings tax in the Cayman Islands.

On March 21, 2018, the

Hong Kong Legislative Council passed The Inland Revenue (Amendment) (No.

7) Bill 2017 (the “Bill”) which introduces

the two-tiered profits tax rates regime.

The Bill was signed into law on March 28, 2018 and was gazette on the following day.

the two-tiered profits tax rates regime, the first 2 million Hong Kong Dollar (“HKD”) of profits of the qualifying

group entity will be taxed at 8.25%, and profits above HKD2 million will be taxed at 16.5%.

WFOE, Horgos, Glory

Star Beijing, Beijing Leshare, Horgos Glory Prosperity, Shenzhen Leshare, Horgos Glary Wisdom, Beijing Glory Wisdom and Xing Cui

Can were incorporated in the PRC and are subject to PRC Enterprise Income Tax (“EIT”) on the taxable income in accordance

with the relevant PRC income tax laws.

On March 16, 2007, the National People’s Congress enacted a new enterprise income

tax law, which took effect on January 1, 2008.

The law applies a uniform 25% enterprise income tax rate to both foreign invested

enterprises and domestic enterprises.

For the three months ended March 31, 2019 and 2020, Beijing Leshare and Beijing Glary Wisdom

were recognized as small low-profit enterprise and received a preferential income tax rate of 10%.

Horgos, Horgos Glory Prosperity,

and Horgos Glary Wisdom are subject to a preferential income tax rate of 0% for a period of about 4 years since their inception

until the year of 2021, as they are incorporated in the Horgos Economic District, Xinjiang province.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

INCOME TAXES (cont.)

The reconciliations

of the statutory income tax rate and the Company’s effective income tax rate are as follows:

For the three months ended

Net income before provision for income taxes

PRC statutory tax rate

Income tax at statutory tax rate

Expenses not deductible for tax purpose

Changes in valuation allowance

Effect of preferential tax rates granted to the PRC entities (a)

Income tax expense (benefit)

Effective income tax rate

(a) The Company’s subsidiary

Horgos and Horgos Glory Prosperity are subject to a favorable tax rate of 0%.

For three months ended March 31, 2019 and 2020,

the tax saving as the result of the favorable tax rate amounted to $934 and $933, respectively, and per share effect of the favorable

tax rate were $0.02 and $0.02.

The current PRC EIT

Law imposes a 10% withholding income tax for dividends distributed by foreign invested enterprises to their immediate holding companies

outside the PRC.

A lower withholding tax rate will be applied if there is a tax treaty arrangement between the PRC and the jurisdiction

of the foreign holding company.

Distributions to holding companies in Hong Kong that satisfy certain requirements specified by

the PRC tax authorities, for example, will be subject to a 5% withholding tax rate.

As of December 31, 2019

and March 31, 2020, the Company had not recorded any withholding tax on the retained earnings of its foreign invested enterprises

in the PRC, since the Company intends to reinvest its earnings to further expand its business in mainland China, and its foreign

invested enterprises do not intend to declare dividends to their immediate foreign holding companies.

The tax effect of temporary

difference under ASC 740 “Accounting for Income Taxes”

that give rise to deferred tax asset as of December 31, 2019

and March 31, 2020 was as follows:

Deferred tax assets:

Allowance for doubtful accounts

Net operating loss carry forwards

Total deferred tax assets, net

The provisions of ASC

740-10-25, “Accounting for Uncertainty in Income Taxes,”

prescribe a more-likely-than-not threshold for consolidated

financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return.

This interpretation

also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred income tax

assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures.

does not believe that there was any uncertain tax position as of December 31, 2019 and March 31, 2020.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

SHARE-BASED COMPENSATION

On February 14, 2020,

the board of directors of the Company approved 2019 Equity Incentive Plan (“2019 Plan”), which allows for the award

of stock and options, up to 3,732,590 ordinary shares to its employees, directors and consultants.

The per share exercise price

for the ordinary shares to be issued pursuant to exercise of an option will be no less than 100% or 110% of the fair market value

per ordinary share on the date of grant.

On March 13, 2020, three

independent directors of the Company entered into the independent director agreements and restricted stock award agreements (“Award

Agreement”) with the Company.

Pursuant to the Award Agreement, during the term of service as a director of the Company, each

independent director of the Company shall be entitled to a fee of $2 per month ($24 per year) and 2,000 ordinary shares of the

Company per year of service.

On March 13, 2020, the

Company granted each independent director 2,000 shares pursuant to the Award Agreement under the Company’s 2019 Plan.

of the Shares vests upon the date of grant.

The compensation expenses recognized for restricted stock award was $1 for the three

months ended March 31, 2020.

Preferred Shares

The Company is authorized

to issue 2,000,000 preferred shares with a par value of $0.0001 per share with such designation, rights and preferences as may

be determined from time to time by the Company’s Board of Directors.

At December 31, 2019 and March 31, 2020, there were

no preferred shares issued or outstanding.

Ordinary Shares

The Company is authorized

to issue 200,000,000 ordinary shares with a par value of $0.0001 per share.

Holders of the ordinary shares are entitled to one

vote for each share.

The Company engaged

EarlyBirdCapital as an advisor (the “Original Marketing Agreement”) in connection with a Business Combination to assist

the Company in locating target businesses, holding meetings with its shareholders to discuss a potential Business Combination and

the target business’

attributes, introduce the Company to potential investors that are interested in purchasing securities,

assist the Company in obtaining shareholder approval for the Business Combination and assist the Company with its press releases

and public filings in connection with a Business Combination.

The Company agreed to pay EarlyBirdCapital a cash fee equal to $8,750

for such services upon the consummation of a Business Combination (exclusive of any applicable finders’

fees which might

become payable).

The Company also agreed to pay EarlyBirdCapital a cash fee equal to 1.0% of the transaction value if EarlyBirdCapital

located the target business with which the Company consummated a Business Combination.

In connection with

the Business Combination, on February 14, 2020, the Company entered into a Business Combination Marketing Agreement Fee

Amendment (the “Fee Amendment”) with EarlyBirdCapital whereby EarlyBirdCapital agreed to amend the Original

Marketing Agreement.

Under the Fee Amendment, EarlyBirdCapital agreed to reduce its fee of $8.75 million due under the

Original Agreement and forgo reimbursement of expenses in exchange for a convertible promissory note in the amount of $4.0

million without interest (“EBC Note”).

The EBC Note is for a period of one year and is convertible, at

EarlyBirdCapital’s option, into the Company’s ordinary shares at the conversion price equal to the

volume-weighted average price of the Company’s ordinary shares on Nasdaq or such other securities exchange or

securities market on which the Company’s ordinary shares are then listed or quoted, for the ten trading days prior to

such conversion date;

provided, however, the conversion price shall not be less than $5.00 (the “Floor Price”).

On March 26, the EBC Note was converted into the 800,000 of Company’s ordinary shares.

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

EQUITY ( cont.

The Company entered

into a contract for marketing promotion services with Shenzhen Quandu Advertising Co.

(hereinafter referred to as “Quandu

Advertising”) to expand the advertising market in South China to strive for more market share.

Quandu Advertising is a company

dedicated in expansion of advertising business.

It has long been committed to the southern regions of China, including Shenzhen,

Guangdong, Fujian, Hunan and Hubei provinces, and has very extensive resources and established long-term cooperative relations

with consumer, telecommunication and medical enterprises.

The service term is valid for 12 months, from March 2020 to March 2021.

According to the contract, the Company compensated Quandu Advertising for its services hereunder by issuing 125,000 shares valued

at US$2.45 per share on March 13, 2020.

Since listing on NASDAQ,

the Company is striving to expand new areas of business growth and seek cooperation and merger and acquisition of assets.

purpose, the Company and Shenzhen Yijincheng Business Consulting Co., Ltd.

(hereinafter referred to as“Yijincheng”)

entered into an agreement to assist in acquiring media and content assets and seeking partners.

Yijincheng is a company focusing

on conducting business consulting and providing merger and acquisition services for listed companies.

The service term is valid

for 9 months, from March 2020 to December 2020.

According to the contract, the Company compensated Yijincheng for its services

hereunder by issuing 200,000 shares of the company’s ordinary shares valued at US$2.45 per share on March 13, 2020.

At December 31, 2019

and March 31, 2020, there were 41,204,025 and 50,898,866 ordinary shares issued and outstanding.

Pursuant to the Initial

Public Offering, TKK sold 25,000,000 Units at a purchase price of $10.00 per Unit, inclusive of 3,000,000 Units sold to the underwriters

on August 22, 2018 upon the underwriters’

3 unchanged sentences

Each Public Warrant

entitles the holder to purchase one-half of one ordinary share at an exercise price of $11.50 per whole share (see Note 7).

Public Right entitles the holder to receive one-tenth of one ordinary share at the closing of a Business Combination (see Note

PRIVATE PLACEMENT

Simultaneously with the closing of the

Initial Public Offering, Symphony Holdings Limited (“Symphony”) purchased an aggregate of 11,800,000 Private Placement

Warrants at $0.50 per Private Placement Warrant for an aggregate purchase price of $5,900,000.

On August 22, 2018, the Company

consummated the sale of an additional 1,200,000 Private Placement Warrants at a price of $0.50 per Private Placement Warrant, generating

gross proceeds of $600,000.

Each Private Placement Warrant is exercisable to purchase one-half of one ordinary share at an exercise

price of $11.50 per whole share (see Note 5).

The proceeds from of the Private Placement Warrants were added to the proceeds from

the Initial Public Offering held in the Trust Account.

If the Company does not complete a Business Combination within the Combination

Period, the proceeds from the sale of the Private Placement Warrants will be used to fund the redemption of the Public Shares (subject

to the requirements of applicable law) and the Private Placement Warrants will expire worthless.

There will be no redemption rights

or liquidating distributions from the Trust Account with respect to the Private Placement Warrants.

The Private Placement Warrants are identical

to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants (i)

are not redeemable by the Company and (ii) may be exercised for cash or on a cashless basis, so long as they are held by the initial

purchaser or any of its permitted transferees.

If the Private Placement Warrants are held by holders other than the initial purchasers

or any of their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by the

holders on the same basis as the Public Warrants.

In addition, the Private Placement Warrants may not be transferable, assignable

or salable until the consummation of a Business Combination, subject to certain limited exceptions.

RELATED PARTY TRANSACTIONS

Founder Shares

In March 2018, the Company issued an aggregate

of 5,750,000 ordinary shares to the Sponsor (“Founder Shares”) for an aggregate purchase price of $25,000.

15, 2018, the Company effectuated a 1.1-for-1 share dividend resulting in an aggregate of 6,325,000 Founder Shares outstanding.

The 6,325,000 Founder Shares included an aggregate of up to 825,000 shares subject to forfeiture by the Sponsor to the extent that

the underwriters’

over-allotment was not exercised in full or in part, so that the initial shareholders would collectively

own 20% of the Company’s issued and outstanding shares after the Initial Public Offering.

As a result of the underwriters’

election to partially exercise their over-allotment option to purchase 3,000,000 Units and the waiver of the remainder of their

overallotment option, 750,000 Founder Shares are no longer subject to forfeiture and 75,000 Founder Shares were forfeited.

The Initial Shareholders have agreed not

to transfer, assign or sell any of the Founder Shares (except to certain permitted transferees) until (1) with respect to 50% of

the Founder Shares, the earlier of six months after the completion of a Business Combination and the date on which the closing

price of the ordinary shares equals or exceeds $12.50 per share for any 20 trading days within any 30-trading day period commencing

after a Business Combination and (2) with respect to the remaining 50% of the Founder Shares, one year after the completion of

a Business Combination, or earlier, in either case, if, subsequent to a Business Combination, the Company completes a liquidation,

merger, share exchange or other similar transaction which results in all of the Company’s shareholders having the right to

exchange their ordinary shares for cash, securities or other property.

Promissory Note —

Related Party

On March 31, 2018, the Company issued an

unsecured promissory note (the “Promissory Note”) to the Sponsor, pursuant to which the Company borrowed an aggregate

principal amount of $299,784.

The Promissory Note is non-interest bearing and payable on the earlier of December 31, 2018 or the

closing of the Initial Public Offering.

The Promissory Note was repaid in full in August 2018.

Advance from Related Party

TKK Capital Holding advanced the Company

an aggregate of $140,237 to be used for the payment of costs related to the Initial Public Offering.

The advance is unsecured,

non-interest bearing and due on demand.

The advances were repaid in full in August 2018.

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

Administrative Services Agreement

The Company entered into an agreement,

commencing on August 15, 2018 through the earlier of the consummation of a Business Combination or the Company’s liquidation,

to pay an affiliate of the Company’s Chief Executive Officer a monthly fee of $15,000 for general and administrative services,

including office space, utilities and administrative services, which replaced the Company’s prior arrangement of reimbursing

the Sponsor for its office lease.

For the three and nine months ended September 30, 2019, the Company incurred $45,000 and $135,000

in fees for these services.

For each of the three months ended September 30, 2018 and for the period from February 5, 2018 (inception)

through September 30, 2018, the Company incurred $22,500 in fees for these services.

At September 30, 2019 and December 31, 2018,

there are $7,500 in administrative fees included in accounts payable and accrued expenses in the accompanying condensed balance

Related Party Loans

In order to finance transaction costs in

connection with a Business Combination, the initial shareholders, the Company’s officers and directors or their affiliates

may, but are not obligated to, loan the Company funds from time to time or at any time, as may be required (“Working Capital

Loans”).

Each Working Capital Loan would be evidenced by a promissory note.

The Working Capital Loans would either be paid

upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,000,000 of the Working

Capital Loans may be converted into warrants at a price of $0.50 per warrant.

The warrants would be identical to the Private Placement

In the event that a Business Combination does not close, the Company may use a portion of the proceeds held outside the

Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working

Capital Loans.

On September 6, 2019, the Company issued

the Sponsor an unsecured promissory note in a principal amount of up to $1,100,000 (the “Note”) for working capital

loans made or to be made by the Sponsor, pursuant to which $350,000 of previously provided advances were converted into loans

under the Note.

The Note bears no interest and is due on the earlier of (i) the consummation of a Business Combination or (ii)

the liquidation of the Company.

Up to $1,000,000 of the loans under the Note may be converted into warrants, each warrant entitles

the holders to receive one half of one ordinary share, at $0.50 per warrant.

In September 2019, the Company received an additional

$500,000 under the Note, bringing the total outstanding balance due under the Note as of September 30, 2019 to an aggregate of

Registration Rights

Pursuant to a registration rights agreement

entered into on August 15, 2018, the holders of the Founder Shares, Private Placement Warrants (and their underlying securities),

Representative Shares (as defined in Note 7) and any warrants that may be issued upon conversion of the Working Capital Loans (and

their underlying securities) are entitled to registration rights.

The holders of a majority of these securities are entitled to

make up to two demands that the Company register such securities.

The holders of the majority of the Founder Shares can elect to

exercise these registration rights at any time commencing three months prior to the date on which these shares are to be released

The holders of a majority of the Private Placement Warrants (and underlying securities) and warrants issued in payment

of Working Capital Loans (or underlying securities) can elect to exercise these registration rights at any time after the Company

consummates a Business Combination.

Notwithstanding anything herein to the contrary, EarlyBirdCapital, Inc.

(“EarlyBirdCapital”)

and/or its designees may only make a demand registration (i) on one occasion and (ii) during the five-year period beginning on

the effective date of the registration statements related to the Initial Public Offering.

In addition, the holders will have certain

“piggy-back”

registration rights with respect to registration statements filed subsequent to the completion of a Business

The Company will bear the expenses incurred in connection with the filing of any such registration statements.

Business Combination Marketing Agreement

The Company has engaged EarlyBirdCapital

as an advisor in connection with a Business Combination to assist the Company in locating target businesses, holding meetings with

its shareholders to discuss a potential Business Combination and the target business’

attributes, introduce the Company to

potential investors that are interested in purchasing securities, assist the Company in obtaining shareholder approval for the

Business Combination and assist the Company with its press releases and public filings in connection with a Business Combination.

The Company will pay EarlyBirdCapital a cash fee equal to 3.5% of the gross proceeds of the Initial Public Offering for such services

upon the consummation of a Business Combination (exclusive of any applicable finders’

fees which might become payable).

Company will also pay EarlyBirdCapital a cash fee equal to 1.0% of the transaction value if EarlyBirdCapital locates the target

business with which the Company consummates a Business Combination.

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

Share Exchange Agreement

On September 6, 2019, the Company entered

into a Share Exchange Agreement (the “Share Exchange Agreement”) with Glory Star, Glory Star New Media (Beijing) Technology

Co., Ltd., a wholly foreign-owned enterprise limited liability company (“WFOE”) incorporated in the People’s

Republic of China (“PRC”) and indirectly wholly-owned by Glory Star, Xing Cui Can International Media (Beijing) Co.,

Ltd., a limited liability company incorporated in the PRC (“Xing Cui Can”), Horgos Glory Star Media Co., Ltd., a limited

liability company incorporated in the PRC (“Horgos,”

and collectively with Xing Cui Can, the “VIEs”, and

the VIEs, the WFOE and Glory Star, collectively, the “Glory Star Parties”, and the Glory Star Parties collectively

with their respective subsidiaries, the “Glory Star Group”), each of Glory Star’s shareholders (collectively,

the “Sellers”), the Sponsor, in the capacity as the representative from and after the closing of the Transactions (as

defined below) (the “Closing”) for the Company’s shareholders other than the Sellers (the “Purchaser Representative”),

and Zhang Bing, in the capacity as the representative for the Sellers thereunder (the “Seller Representative”).

to the Share Exchange Agreement, among other things and subject to the terms and conditions contained therein, the Company will

effect an acquisition of the Glory Star Group, which primarily conducts its business through the WFOE and the VIEs, by acquiring

from the Sellers all of the issued and outstanding equity interests of Glory Star (together with the other transactions contemplated

by the Share Exchange Agreement, the “Transactions”).

Pursuant to the Share Exchange Agreement,

in exchange for all of the outstanding shares of Glory Star, the Company will issue to the Sellers a number of the Company’s

ordinary shares (the “Exchange Shares”) equal in value to US$425 million, with the Company’s ordinary shares

valued at a price per share equal to the price per share at which each of the Company’s ordinary share is redeemed or converted

pursuant to the redemption by the Company of its public shareholders in connection with the Company’s Business Combination,

as required by its amended and restated memorandum and articles of association (the “Redemption”).

After the Closing, the Sellers will have

the contingent right to receive up to 10,000,000 shares in additional consideration from the Company based on the performance of the Company and its subsidiaries

(including the Glory Star Group) for the fiscal year ended December 31, 2019 (the “2019 Earnout Year”) and the fiscal

year ended December 31, 2020 (the “2020 Earnout Year”).

The Transactions will be consummated subject

to the deliverables and provisions as further described in the Share Exchange Agreement.

SHAREHOLDERS’

Preferred Shares —

The Company is authorized to issue 2,000,000 preferred shares with a par value of $0.0001 per share with such designation, rights

and preferences as may be determined from time to time by the Company’s Board of Directors.

At September 30, 2019 and December

31, 2018, there were no preferred shares issued or outstanding.

Ordinary Shares —

Company is authorized to issue 200,000,000 ordinary shares with a par value of $0.0001 per share.

Holders of the ordinary shares

are entitled to one vote for each share.

At September 30, 2019 and December 31, 2018, there were 7,028,547 and 6,896,324 ordinary

shares issued and outstanding, excluding 24,421,453 and 24,553,676 ordinary shares to possible redemption, respectively.

Warrants —

Public Warrants

may only be exercised for a whole number of shares.

No fractional ordinary shares will be issued upon exercise of the Public Warrants.

The Public Warrants will become exercisable on the later of (a) the completion of a Business Combination and (b) 12 months from

the closing of the Initial Public Offering.

No Public Warrants will be exercisable for cash unless the Company has an effective

and current registration statement covering the ordinary shares issuable upon exercise of the Public Warrants and a current prospectus

relating to such ordinary shares.

Notwithstanding the foregoing, if a registration statement covering the ordinary shares issuable

upon the exercise of the Public Warrants is not effective within 90 days from the consummation of a Business Combination, the holders

may, until such time as there is an effective registration statement and during any period when the Company shall have failed to

maintain an effective registration statement, exercise the Public Warrants on a cashless basis pursuant to an available exemption

from registration under the Securities Act.

If an exemption from registration is not available, holders will not be able to exercise

their Public Warrants on a cashless basis.

The Public Warrants will expire five years from the consummation of a Business Combination

or earlier upon redemption or liquidation.

The Company may redeem the Public Warrants:

in whole and not in part;

at a price of $0.01 per warrant;

at any time while the Public Warrants are exercisable;

upon not less than 30 days’

prior written notice of redemption to each Public Warrant holder;

if, and only if, the reported last sale price of the Company’s ordinary shares equals or exceeds $18.00 per share, for any 20 trading days within a 30-trading day period ending on the third business day prior to the notice of redemption to the warrant holders;

if, and only if, there is a current registration statement in effect with respect to the ordinary shares underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

If the Company calls the Public Warrants

for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a

“cashless basis,”

as described in the warrant agreement.

The exercise price and number of ordinary

shares issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a capitalization

of shares, extraordinary dividend or recapitalization, reorganization, merger or consolidation.

However, the warrants will not

be adjusted for issuances of ordinary shares at a price below their exercise price or issuance of potential extension warrants

in connection with an extension of the period of time for the Company to complete a Business Combination.

Additionally, in no event

will the Company be required to net cash settle the warrants.

If the Company is unable to complete a Business Combination within

the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any

of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside

of the Trust Account with the respect to such warrants.

Accordingly, the warrants may expire worthless.

Rights —

cases where the Company is not the surviving company in a Business Combination, each holder of a Public Right will automatically

receive one-tenth (1/10) of an ordinary share upon consummation of a Business Combination, even if the holder of a Public Right

converted all ordinary shares held by him, her or it in connection with a Business Combination or an amendment to the Company’s

Amended and Restated Memorandum and Articles of Association with respect to its pre-business combination activities.

that the Company will not be the surviving company upon completion of the initial Business Combination, each holder of a Public

Right will be required to affirmatively convert his, her or its rights in order to receive the one-tenth (1/10) of a share underlying

each Public Right upon consummation of the Business Combination.

No additional consideration will be required to be paid by a holder

of Public Rights in order to receive his, her or its additional ordinary shares upon consummation of a Business Combination.

shares issuable upon exchange of the rights will be freely tradable (except to the extent held by affiliates of the Company).

the Company enters into a definitive agreement for a Business Combination in which the Company will not be the surviving entity,

the definitive agreement will provide for the holders of Public Rights to receive the same per share consideration the holders

of ordinary shares will receive in the transaction on an as-converted into ordinary shares basis.

The Company will not issue fractional shares

in connection with an exchange of Public Rights.

Fractional shares will either be rounded down to the nearest whole share or otherwise

addressed in accordance with the applicable provisions of the Cayman Islands law.

As a result, the holders of the Public Rights

must hold rights in multiples of 10 in order to receive shares for all of the holders’

rights upon closing of a Business

If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates

the funds held in the Trust Account, holders of Public Rights will not receive any of such funds with respect to their Public Rights,

nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such Public

Rights, and the Public Rights will expire worthless.

Further, there are no contractual penalties for failure to deliver securities

to the holders of the Public Rights upon consummation of a Business Combination.

Additionally, in no event will the Company be

required to net cash settle the rights.

Accordingly, the rights may expire worthless.

Representative Shares

At the closing of the Initial Public Offering,

the Company issued EarlyBirdCapital (and its designees) 200,000 ordinary shares (the “Representative Shares”).

Company accounted for the Representative Shares as an expense of the Initial Public Offering, resulting in a charge directly to

shareholders’

The Company estimated that the fair value of Representative Shares was $2,000,000 based upon the offering

price of the Units of $10.00 per Unit.

EarlyBirdCapital has agreed not to transfer, assign or sell any such shares until the completion

of a Business Combination.

In addition, EarlyBirdCapital (and its designees) has agreed (i) to waive its redemption rights with

respect to such shares in connection with the completion of a Business Combination (ii) to waive its right to receive potential

extension warrants with respect to such shares in connection with an extension of the period of time for the Company to consummate

a Business Combination, and (ii) to waive its rights to liquidating distributions from the Trust Account with respect to such shares

if the Company fails to complete a Business Combination within the Combination Period.

TKK SYMPHONY ACQUISITION CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2019

The Representative Shares have been deemed

compensation by FINRA and are therefore subject to a lock-up for a period of 180 days immediately following the effective date

of the registration statement related to the Initial Public Offering pursuant to Rule 5110(g)(1) of FINRA’s NASD Conduct

Pursuant to FINRA Rule 5110(g)(1), these securities will not be the subject of any hedging, short sale, derivative, put

or call transaction that would result in the economic disposition of the securities by any person for a period of 180 days immediately

following the effective date of the registration statements related to the Initial Public Offering, nor may they be sold, transferred,

assigned, pledged or hypothecated for a period of 180 days immediately following the effective date of the registration statements

related to the Initial Public Offering except to any underwriter and selected dealer participating in the Initial Public Offering

and their bona fide officers or partners.

FAIR VALUE MEASUREMENTS

The Company follows the guidance in ASC

820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period and non-financial

assets and liabilities that are re-measured and reported at fair value at least annually.

The fair value of the Company’s financial

assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with

the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants

at the measurement date.

In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize

the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal

assumptions about how market participants would price assets and liabilities).

The following fair value hierarchy is used to classify

assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:

Quoted prices in active markets for identical assets or liabilities.

An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Observable inputs other than Level 1 inputs.

Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.

Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.

The following table presents information

about the Company’s assets that are measured at fair value on a recurring basis at September 30, 2019 and December 31, 2018,

and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

September 30,

Marketable securities held in Trust Account

$ 256,286,247

$ 251,886,105

entitles the holder to purchase one-half of one ordinary share at an exercise price of $11.50 per whole share.

Each Public Right

entitles the holder to receive one-tenth of one ordinary share at the closing of a Business Combination.

Simultaneously with

the closing of the Initial Public Offering, Symphony Holdings Limited (“Symphony”) purchased an aggregate of 11,800,000

Private Placement Warrants at $0.50 per Private Placement Warrant for an aggregate purchase price of $5,900.

On August 22, 2018,

TKK consummated the sale of an additional 1,200,000 Private Placement Warrants at a price of $0.50 per Private Placement Warrant,

generating gross proceeds of $600.

Each Private Placement Warrant is exercisable to purchase one-half of one ordinary share at

an exercise price of $11.50 per whole share.

The Private Placement

Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private

Placement Warrants (i) are not redeemable by the Company and (ii) may be exercised for cash or on a cashless basis, so long as

they are held by the initial purchaser or any of its permitted transferees.

If the Private Placement Warrants are held by holders

other than the initial purchasers or any of their permitted transferees, the Private Placement Warrants will be redeemable by the

Company and exercisable by the holders on the same basis as the Public Warrants.

In addition, the Private Placement Warrants may

not be transferable, assignable or salable until the consummation of a Business Combination, subject to certain limited exceptions.

The summary of warrant

activity is as follows:

December 31, 2019

Granted/Acquired

March 31, 2020

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

dollars in thousands, except share and per share data)

EQUITY ( cont.

Each holder of a Public

Right will automatically receive one-tenth (1/10) of an ordinary share upon consummation of a Business Combination, even if the

holder of a Public Right converted all ordinary shares held by him, her or it in connection with a Business Combination or an amendment

to the Company’s Amended and Restated Memorandum and Articles of Association with respect to its pre-business combination

Upon the closing of the Business Combination, the Company issued 2,504,330 shares in connection with an exchange of

Public Rights.

Statutory reserve

Horgos, Beijing Glory

Star, Beijing Leshare, Shenzhen Leshare, Horgos Glary Wisdom, Beijing Glary Wisdom, Glary Prosperity, and Xing Cui Can operate

in the PRC, are required to reserve 10% of their net profit after income tax, as determined in accordance with the PRC accounting

rules and regulations.

Appropriation to the statutory reserve by the Company is based on profit arrived at under PRC accounting

standards for business enterprises for each year.

The profit arrived at must be set off against any accumulated losses sustained

by the Company in prior years, before allocation is made to the statutory reserve.

Appropriation to the statutory reserve must

be made before distribution of dividends to shareholders.

The appropriation is required until the statutory reserve reaches 50%

of the registered capital.

This statutory reserve is not distributable in the form of cash dividends.

Non-controlling interest

As of March 31, 2020,

the Company’s non-controlling interest represented 49% equity interest of Horgos Glary Wisdom and 49% equity interest of

Glary Prosperity respectively.

SUBSEQUENT EVENTS

The Company evaluates subsequent events

and transactions that occur after the balance sheet date up to the date that the financial statements were issued.

Based upon this

review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements.

MANAGEMENT’S DISCUSSION

AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

References in this report (the “Quarterly

Report”) to “we,”

Following the completion

of the 2019 fiscal year, and in accordance with the terms of the Share Exchange Agreement, the Company determined that the 2019

earnout target were met and the Sellers are entitled to the 2019 Earnout Shares.

On April 22, 2020, the Company issued an additional

5,000,000 of the Company’s ordinary shares as the 2019 Earnout Shares to the Sellers, or their assigns, if any, pursuant

to the terms of the Shares Exchange Agreement.

The Company evaluated

the subsequent event through the date of the report available to issue, and conclude that there are no additional reportable subsequent

events other than that disclosed in above.

Management’s Discussion and Analysis of Financial

Condition and Results of Operations

The following discussion

and analysis should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and related

notes included elsewhere in this Quarterly Report on Form 10-Q.

The terms “Company,”

“we,”

“us,”

or the “Company”

refer to TKK Symphony Acquisition Corporation.

References to our “management”

or our “management team”

refer to our officers and directors, and references

to our “Sponsor”

refer to TKK Symphony Sponsor 1.

The following discussion and analysis of the Company’s financial

condition and results of operations should be read in conjunction with the unaudited condensed financial statements and the notes

thereto contained elsewhere in this Quarterly Report.

Certain information contained in the discussion and analysis set forth below

includes forward-looking statements that involve risks and uncertainties.

Special Note Regarding Forward-Looking

This Quarterly Report includes “forward-looking

statements”

within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act that are not historical

facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected.

All statements, other than statements of historical fact included in this Quarterly Report including, without limitation, statements

in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations”

regarding the

Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking

Words such as “expect,”

“believe,”

“anticipate,”

“intend,”

“estimate,”

“seek”

and variations and similar words and expressions are intended to identify such forward-looking statements.

forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based

on information currently available.

A number of factors could cause actual events, performance or results to differ materially

from the events, performance and results discussed in the forward-looking statements.

For information identifying important factors

that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to

the Risk Factors section of the Company’s Annual Report on Form 10-K for the period ended December 31, 2018 filed with the

Securities and Exchange Commission (the “SEC”).

The Company’s securities filings can be accessed on the EDGAR

section of the SEC’s website at www.sec.gov.

Except as expressly required by applicable securities law, the Company disclaims

any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events

or otherwise.

and “our”

refer to Glory Star New Media Group Holdings Limited and, except where the context requires otherwise, our

wholly-owned subsidiaries and variable interest entities (“VIEs”) Xing Cui Can International Media (Beijing) Co.,

(“Xing Cui Can”) and Horgos Glory Star Media Co., Ltd.

(“Horgos”).

Forward-Looking Statements

We make statements in

this quarterly report that are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section

21E of the Securities Exchange Act of 1934, or the Exchange Act.

These forward-looking statements can be identified by the use

of forward-looking terminology, including the words “believes,”

“estimates,”

“anticipates,”

“expects,”

“intends,”

“plans,”

“may,”

“will,”

“potential,”

“projects,”

“predicts,”

“continue,”

or “should,”

or, in each case, their negative

or other variations or comparable terminology.

Our forward-looking statements reflect our current views about our plans, intentions,

expectations, strategies and prospects, which are based on the information currently available to us and on assumptions we have

Although we believe that our plans, intentions, expectations, strategies and prospects as reflected in or suggested by our

forward-looking statements are reasonable, we can give no assurance that our plans, intentions, expectations, strategies or prospects

will be attained or achieved and you should not place undue reliance on these forward-looking statements.

Furthermore, actual results

may differ materially from those described in the forward-looking statements and may be affected by a variety of risks and factors

including, without limitation:

● future operating or financial results;

● future payments of dividends, if any, and the availability

of cash for payment of dividends, if any;

● future acquisitions, business strategy and expected

capital spending;

● assumptions regarding interest rates and inflation;

● ability to attract and retain senior management and

other key employees;

● ability to manage our growth;

● fluctuations in general economic and business conditions;

● financial condition and liquidity, including our ability

to obtain additional financing in the future (from warrant exercises or outside services) to fund capital expenditures, acquisitions

and other general corporate activities;

● estimated future capital expenditures needed to preserve

our capital base;

● the ability to meet the Nasdaq continuing listing

standards, and the potential delisting of our securities from Nasdaq;

● potential changes in the legislative and regulatory

environments;

● a lower return on investment;

● potential volatility in the market price of our securities;

an epidemic or pandemic (such as the outbreak and worldwide spread of novel coronavirus (“COVID-19”), and the measures

that Chinese governments may impose to address it, which may (as with COVID-19) precipitate or exacerbate one or more of the above-mentioned

factors and/or other risks, and significantly disrupt or prevent us from operating our business in the ordinary course for an

extended period;

● other events outside of our control.

Accordingly, there is

no assurance that our expectations will be realized.

Except as otherwise required by the federal securities laws, we disclaim any

obligations or undertaking to publicly release any updates or revisions to any forward-looking statement contained herein (or elsewhere)

to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any

such statement is based.

The reader should carefully review our financial statements and the notes thereto, as well as the section

entitled “Risk Factors”

in our Annual Report on Form 10-K for the year ended December 31, 2019.

Recent Developments

On September 6, 2019, we entered into a

Share Exchange Agreement with Glory Star, pursuant to which we will issue to the Sellers a number of Exchange Shares equal in value

to US$425 million.

See Note 6 to Item 1 above for a description of the Share Exchange Agreement and the transactions contemplated

We are a blank check company incorporated

on February 5, 2018 as a Cayman Islands exempted company and formed for the purpose of effecting a merger, share exchange, asset

acquisition, share purchase, recapitalization, reorganization or similar Business Combination with one or more businesses.

to utilize cash derived from the proceeds of the Initial Public Offering, our securities, debt or a combination of cash, securities

and debt in effecting a Business Combination.

The issuance of additional shares in a

Business Combination:

may significantly reduce the equity interest of our shareholders;

may subordinate the rights of holders of ordinary shares if we issue preferred shares with rights senior to those afforded to our ordinary shares;

will likely cause a change in control if a substantial number of our ordinary shares are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and most likely will also result in the resignation or removal of our present officers and directors;

may adversely affect prevailing market prices for our securities.

Similarly, if we issue debt securities, it could result in:

default and foreclosure on our assets if our operating revenues after a Business Combination are insufficient to pay our debt obligations;

acceleration of our obligations to repay the indebtedness even if we have made all principal and interest payments when due if the debt security contains covenants that required the maintenance of certain financial ratios or reserves and we breach any such covenant without a waiver or renegotiation of that covenant;

our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand;

our inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing while the debt security is outstanding;

We expect to continue to incur significant

costs in the pursuit of our acquisition plans.

We cannot assure you that our plans to raise capital or to complete a Business Combination

will be successful.

Glory Star New Media

Group Holdings Limited, formerly known as TKK Symphony Acquisition Corporation (“GS Holdings”) was a blank check company

formed on February 5, 2018 for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization,

reorganization or other similar business combination with one or more businesses or entities.

On February 14, 2020,

GS Holdings consummated the transaction (the “Business Combination”) contemplated by the Share Exchange Agreement dated

as of September 6, 2019, as amended (“Share Exchange Agreement”), by and among the Company, Glory Star New Media Group

Limited, a Cayman Islands exempted company (“Glory Star”), Glory Star New Media (Beijing) Technology Co., Ltd., a wholly

foreign-owned enterprise limited liability company (“WFOE”) incorporated in the People’s Republic of China (“PRC”)

and indirectly wholly-owned by Glory Star, Xing Cui Can International Media (Beijing) Co., Ltd., a limited liability company incorporated

in the PRC (“Xing Cui Can”), Horgos Glory Star Media Co,.

Ltd., a limited liability company incorporated in the PRC

(“Horgos”), each of Glory Star’s shareholders (collectively, the “Sellers”), TKK Symphony Sponsor

1, the Company’s sponsor (the “Sponsor”), in the capacity as the representative from and after the closing of

the Business Combination for GS Holdings’

shareholders other than the Sellers, and Bing Zhang, in the capacity as the representative

for the Sellers thereunder, pursuant to which GS Holdings acquired 100% of the equity interests of Glory Star from the Sellers.

As a result of the Business Combination, Sellers became the controlling shareholders of the Company.

The Business Combination was

accounted for as a reverse merger, wherein Glory Star is considered the acquirer for accounting and financial reporting purposes and

the transaction was treated as a recapitalization of Glory Star.

Upon closing of the

Business Combination (the “Closing”), GS Holdings acquired all of the issued and outstanding securities of Glory Star

in exchange for (i) 41,204,025 of the Company’s ordinary shares (“Closing Payment Shares”), or one ordinary share

for approximately 0.04854 outstanding shares of Glory Star, of which 2,060,201 of the Closing Payment Shares (the “Escrow

Shares”) shall be deposited into escrow to secure certain indemnification obligations of the Sellers, plus (ii) earnout payments

consisting of up to an additional 5,000,000 of the Company’s ordinary shares if GS Holdings meet certain financial performance

targets for the 2019 fiscal year and an additional 5,000,000 of GS Holdings’

ordinary shares if GS Holdings meets certain

financial performance targets for the 2020 fiscal year (the “Earnout Shares”).

In the event that a financial performance

target is not met for the 2019 fiscal year and/or 2020 fiscal year but GS Holdings meets certain financial performance targets

for the 2019 fiscal year and 2020 fiscal year combined, the Sellers will be entitled to receive any Earnout Shares that they otherwise

did not receive (the “Alternative Earnout”).

In connection with the

Business Combination, GS Holdings initiated a tender offer to purchase for cash up to 25,000,000 of its ordinary shares at a price

of $10.31 per share and a contingent cash payment equal to a pro rata portion of any additional accrued interest remaining in TKK’s

Company’s trust account in excess of $10.28 per share, net to the seller in cash, without interest, less any applicable withholding

taxes (“Tender Offer”).

The Tender Offer expired at 5:00 p.m.

New York City time on February 13, 2020.

As of the expiration

of the Tender Offer, a total of 24,986,159 ordinary shares have been validly tendered and not withdrawn and at the final price

of approximately $10.31 per share, net to the seller in cash.

Upon the expiration of the Tender Offer and the closing of the Business

Combination, the total amount of funds in GS Holdings’

trust account of $257,863,157 were released and distributed as follows:

(1) $257,720,393 for the repurchase of 24,986,159 ordinary shares to shareholders who elected tender their ordinary shares, and

(2) $142,764 for the payment of fees and expenses related to the Business Combination.

We provide advertisement

and content production services and operate a leading mobile and online digital advertising, media and entertainment business in

After launching our CHEERS App in 2018, we are fast becoming one of the leading e-commerce platforms in China by allowing

our users to access our online store (e-Mall), video content, live streaming, and online games.

We focus on creating original professionally-produced

content featuring lifestyle, culture and fashion to monetize our advertising and e-commerce platform.

We mainly offer and generate

revenue from the copyright licensing of self-produced content, advertising and customized content production and CHEERS e-Mall

marketplace service and others.

We intend to capitalize on the immense growth potential of China’s live streaming and e-commerce

markets while cultivating new, innovative monetization opportunities.

Currently, we generate

a substantial part of our revenues from advertising placed within our mobile and online video content and on our e-commerce platform.

While our mobile and online advertising business is still growing and remains one of our largest sources of revenues, we will also

expand our development and promotion of our e-Mall that was launched in 2019.

We monitor the following

key metrics to evaluate the growth of our business, measure the effectiveness of our marketing efforts, identify trends affecting

our business, and make strategic decisions:

CHEERS App Downloads.

We define this metric as the total number of downloads of the CHEERS App as of the end of the period.

Because we have expanded

into e-commerce through our CHEERS App, we believe that this is a key metric in understanding the growth in this business.

number of downloads demonstrates whether we are successful in our marketing efforts in converting viewers of our professionally-produced

content on other platforms to the CHEERS App.

We view the number of downloads at the end of a given period as a key indicator of

the attractiveness and usability of our CHEERS App and the increased traffic to our e-Mall platform.

As of March 31, 2020, downloads

of the CHEERS App exceeded 100.5 million.

As of April 30, 2020, the cumulative number of downloads of the CHEERS App exceeded 106.5

We believe that this increase in downloads demonstrates the success that we have in converting viewers of our content

to the CHEERS App.

Merchandise Value (GMV).

We define gross merchandise value, or GMV, as the volume of merchandise sold through our CHEERS

App at the end of the period.

As we grow our e-Mall platform, it is important to monitor the volume of merchandise that we

have sold through the e-Mall.

By keeping track of the GMV, it allows us to determine the attractiveness of our CHEERS App

platform to our merchants and users.

Ended March 31, 2020, the Company’s e-Mall has carried 9,602 Stock Keeping Units

(“SKUs”) in total, and for three months ended March 31, 2020, our e-Mall has recorded over $5.8 million in the

volume of merchandise sold through our CHEERS App - gross merchandise value (“GMV”), achieving an impressive

monthly GMV of nearly $3.0 million in March 2020, up from only $0.2 million in April 2019.

As of April 30, 2020, our e-Mall

has recorded over an accumulated $27.8 million in GMV.

We believe that growth in the GMV will be driven significantly our

ability to attract and retain users to the CHEERS App through our professionally-produced content and to further enhance our

product offerings.

Daily Active Users

We define daily active users, or DAUs, as a user who has logged in or accessed our online video content and/or our

e-commerce platform using the CHEERS App, whether on a mobile phone or tablet.

We calculate DAUs using internal company data based

on the activity of the user account and as adjusted to remove “duplicate”

DAU is a tool that our management

uses to manage their operations.

In particular, our management sets daily targets of DAUs and monitors the DAUs to see whether

to make adjustments as to the promotional activities, advertising campaign, and/or online video contents.

On average for the years

2019, the DAU was 1.91 million.

On average for the three months ended March 31, 2019 and 2020, the DAU were 0.49 million and 4.12

million, respectively.

COVID-19 Affecting Our Results of Operations

In December 2019, COVID-19

started to spread in China, and then to other parts of the world in early 2020.

The COVID-19 pandemic has resulted in quarantines,

travel restrictions, and temporary closure of stores and facilities in China and elsewhere.

With the rapid spread

of COVID-19, the global economy is under tremendous pressure and has triggered unprecedented policy changes in governments around

However, if the epidemic is not controlled in a timely manner, this could adversely affect businesses in China.

closely monitoring the development of COVID-19 and continuously evaluate the potential impact on us and our industry.

Although the COVID-19

outbreak may materially adversely affect the global economy, there is a high rapid growth in the online entertainment and online

consumption due to the restriction on outdoor activities.

We have seen a rapid growth in our mobile and online operation during

Compared to the fourth quarter of 2019, the download number of CHEERS App has increased by 18%, DAUs has increased

and the monthly active users (“MAUs”) also get a 7% increase.

The total video playback volume has exceeded 10

billion, which is a 38% increase compared to the average volume in year 2019.

The average playback length of each video has increased

We also had progress

in the development of CHEERS App that enriched people’s online entertainment and online consumption during the COVID-19 epidemic

However, our copyright licensing and advertising business suffered a downturn as we had difficulty in filming TV series

and short online videos because employees were encouraged to work remotely from home pursuant to the requirement of quarantines

and travel restrictions.

The production of contents was gradually suspended after the outbreak of COVID-19 and less contents were

available to place advertisements.

Due to the temporary closure of business in China and our customers’

operation stagnation,

our collection of accounts receivable also slowed down from January to March 2020, which has gradually recovered starting from

early April, with the work resumption in China.

Results of Operations

We have neither engaged in any operations

nor generated any revenues to date.

Our only activities from February 5, 2018 (inception) through September 30, 2019 were organizational

activities, those necessary to consummate the Initial Public Offering, described below, identifying a target company for a Business

Combination and the proposed acquisition of Glory Star.

We do not expect to generate any operating revenues until after the completion

of our Business Combination.

We generate non-operating income in the form of interest income on marketable securities.

expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as

for due diligence expenses.

For the three months ended September 30,

2019, we had net income of $552,308, which consists of interest income on marketable securities held in the Trust Account of $1,365,513,

offset by an unrealized loss on marketable securities held in our Trust Account of $122,750 and operating costs of $690,455.

For the nine months ended September 30,

2019, we had net income of $2,966,101, which consists of interest income on marketable securities held in the Trust Account of

$4,423,040, offset by an unrealized loss on marketable securities held in our Trust Account of $22,898 and operating costs of $1,434,041.

For the three months ended September 30,

2018 and for the period from February 5, 2018 (inception) through September 30, 2018, we had net income of $371,210 and $331,351,

respectively, which consists of interest income on marketable securities held in the Trust Account $588,938, offset by operating

costs of $64,359 and $104,218, respectively, and an unrealized loss on marketable securities held in our Trust Account $153,369.

Comparison of Results of Operations

for the Three Months Ended March 31, 2019 and 2020 (unaudited)

The following table

summarizes our historical consolidated statements of operations data:

(in thousands, except for percentages)

For the three months ended

Operating expenses:

Cost of Revenues

Selling and marketing

General and administrative

Research and development

Total operating expense

Income from operations

Total other expenses, net

Income before income tax

Income (tax expense) benefit

Net income attributable to Glory Star New Media Group Holdings Limited’s shareholders

We primarily have four

broad categories of revenues:

Our revenues for the three

months ended March 31, decreased by $4.0 million, or 29.06%, to $9.8 million compared to $13.8 million for the three months ended

March 31, 2020 mainly due to the decrease in advertising revenue and copyrights licensing revenue, which was partially offset by

an uptick in revenues generated from copyright licensing of produced TV series, the customized content production and CHEERS e-Mall

marketplace service as the e-Mall first launched in April 2019.

The advertising revenues

of 7.9 million for the three months ended March 31, 2020 decreased by $2.5 million, or 24.2%, as compared to $10.4 million for

the three months ended March 31, 2019, which was primarily due to the adverse impact of COVID-19 and transformation of live streams.

Our advertisements are mainly embedded in short videos and live streams, which saw a decrease due to the difficulty in filming

caused by the quarantines and travel restriction during COVID-19 outbreak.

The copyright licensing revenue also decreased $1.7

million, or 63.6%, to $1.0 million for the three months ended March 31, 2020 from $2.7 million in the same period of 2019 as we

only have copyright revenue from one TV channel over the three months ended March 31, 2020 compared to three TV channels over the

three months ended March 31, 2019.

Operating expenses

Operating expenses consists

of cost of revenues, selling and marketing, general and administrative and research and development expense.

Cost of revenues consists

primarily of production cost of TV series, short stream video and network drama, labor cost and related benefits, payments to various

channel owners for broadcast, and copyrights and costs associated with the operation of our online game and shopping platform on

the CHEERS App such as bandwidth cost and amortization of intangible assets.

Our cost of revenues decreased by $3.2 million, or

39.22%, to $5.0 million for the three months ended March 31, 2020 from $8.2 million for the three months ended March 31, 2019,

which was in line with the decrease of revenue.

The incremental decrease was attributed by the decrease of expenditure on the payments

to various channel owners for broadcast advertisements, as we made more use of our own platform CHEERS App which has already attracted

large number users to provide advertising service.

Our sales and marketing

expenses primarily consist of salaries and benefits of sales department, advertising fee, travelling expense and CHEERS e-Mall

marketing expense.

Our sales and marketing expenses increased by $0.12 million, or 46.33% to $0.4 million for the three months

ended March 31, 2020 from $0.26 million for the three months ended March 31, 2019.

As a percentage of revenues, sales and marketing

expenses in the first quarter of 2020 were 3.9% as compared to 1.9% in the same period of 2019, which was due to the increase

of coupons and reward points provided to users on CHEERS e-Mall to stimulate platform consumption.

Our general and administrative

expenses consist primarily of salaries and benefits of members of our management and bad debt provision expense for accounts receivable

and professional service fees.

Our general and administrative expenses increased by $0.65 million, or 101.41%, to $1.3 million

for the three months ended March 31, 2020 from $0.6 million for the three months ended March 31, 2019.

Such increase was mainly

due to an increase of $0.2 million of professional service fee incurred after being listed as public companies and an increase

of $0.4 million of bad debt provision expense due to the slow collection of accounts receivables during the three months ended

March 31, 2020.

Our research and development

expenses consist primarily of salaries and benefits for our research and development department.

Our research and development expenses

during the three months ended March 31, 2020 were $0.2 million compared to $0.2 million in the same period of 2019.

As a percentage

of revenues, research and development expenses during the three months ended March 31, 2020 were 2.1% compared to 1.4% in the same

period of 2019, as we continued to invest in the information technology of our platform in order to strengthen our technology and

research and development capabilities.

Other expense, net

Other net expenses primarily

consist of interest expense, net of $0.14 million and $0.09 million for the three months ended March 31, 2019 and 2020, respectively.

As a result of the foregoing,

we had a net income of $2.8 million for the three months ended March 31, 2020, as compared to a net income of $4.1 million

for the three months ended March 31, 2019.

Net operating margin for the three months ended March 31, 2020 reduced slightly to 29.1%

from 30.1% in the same period of 2019.

Liquidity and Capital Resources

On August 20 and 22, 2018, we consummated

the Initial Public Offering of 22,000,000 Units and the sale of an additional 3,000,000 Units pursuant to the underwriters’

partial exercise of their over-allotment option at a price of $10.00 per Unit, generating aggregate gross proceeds of $250,000,000.

Simultaneously with the closings of the Initial Public Offering and the sale of the additional Units, we consummated the sales

of an aggregate of 13,000,000 Private Placement Warrants to Symphony Holdings Limited at a price of $0.50 per warrant, generating

gross proceeds of $6,500,000.

In connection with the Initial Public Offering

and the private placement, a total of $250,000,000 was placed in the Trust Account.

We incurred $5,744,938 in Initial Public Offering

related costs, including $5,000,000 of underwriting fees and $744,938 of other costs.

For the nine months ended September 30,

2019, cash used in operating activities was $1,209,724.

Net income of $2,966,101 was affected by interest earned on marketable

securities held in the Trust Account of $4,423,040, an unrealized loss on marketable securities held in our Trust Account of $22,898

and changes in our operating assets and liabilities, which provided $224,317 of cash from operating activities.

For the period from February 5, 2018 (inception)

through September 30, 2018, cash used in operating activities was $129,006.

Net income of $331,351 was impacted by interest earned

on marketable securities held in the Trust Account of $588,938, an unrealized loss on marketable securities held in our Trust Account

of $153,369 and changes in our operating assets and liabilities, which used $24,788 of cash from operating activities.

As of September 30, 2019, we had marketable

securities held in the Trust Account of $256,286,247 (including approximately $6,286,000 of interest income, net of unrealized

losses) consisting of U.S.

treasury bills with a maturity of 180 days or less.

Interest income on the balance in the Trust Account

may be used by us to pay taxes.

Through September 30, 2019, we did not withdraw any funds from the interest earned on the Trust

We intend to use substantially all of the

funds held in the Trust Account, including any amounts representing interest earned on the Trust Account to acquire a target business

or businesses and to pay our expenses relating thereto, including a cash fee equal to 3.5% of the gross proceeds of Initial Public

Offering payable to the upon consummation of our Business Combination for assisting us in connection with such Business Combination.

To the extent that our ordinary shares are used in whole or in part as consideration to effect our Business Combination, the remaining

proceeds held in the Trust Account as well as any other net proceeds not expended will be used as working capital to finance the

operations of the target business.

Such working capital funds could be used in a variety of ways including continuing or expanding

the target business’

operations, for strategic acquisitions and for marketing, research and development of existing or new

Such funds could also be used to repay any operating expenses or finders’

fees which we had incurred prior to the

completion of our Business Combination if the funds available to us outside of the Trust Account were insufficient to cover such

As of September 30, 2019, we had cash of

$47,270 held outside of the Trust Account.

We intend to use the funds held outside the Trust Account primarily to identify and

evaluate prospective acquisition candidates, perform business due diligence on prospective target businesses, travel to and from

the offices, plants or similar locations of prospective target businesses, review corporate documents and material agreements of

prospective target businesses, select the target business to acquire and structure, negotiate and consummate a Business Combination.

In order to fund working capital deficiencies

or finance transaction costs in connection with a Business Combination, the initial shareholders, the Company’s officers

and directors or their affiliates may, but are not obligated to (except as described herein), loan us funds as may be required.

In the event that our Business Combination does not close, we may use a portion of the working capital held outside the Trust Account

to repay such loaned amounts but no proceeds from our Trust Account would be used for such repayment.

Up to $1,000,000 of such

loans may be convertible into warrants at a price of $0.50 per warrant at the option of the lender.

The warrants would be identical

to the Private Placement Warrants issued to our Sponsor.

We do not expect to seek loans from parties other than the initial shareholders,

the Company’s officers and directors or their affiliates as we do not believe third parties will be willing to loan such

funds and provide a waiver against any and all rights to seek access to funds in our Trust Account.

On September 6, 2019, we issued the Sponsor

an unsecured promissory note in a principal amount of up to $1,100,000 (the “Note”) for working capital loans made

or to be made by the Sponsor, pursuant to which $350,000 of previously provided advances were converted into loans under the Note.

The Note bears no interest and is due on the earlier of (i) the consummation of a Business Combination or (ii) our liquidation.

Up to $1,000,000 of the loans under the Note may be converted into warrants, each warrant entitles the holders to receive one

half of one ordinary share, at $0.50 per warrant.

In September 2019, the Company received an additional $500,000 under the Note,

bringing the total outstanding balance due under the Note as of September 30, 2019 to an aggregate of $850,000.

We have principally financed our operations from inception using proceeds from the sale of our equity

securities to our shareholders prior to the Initial Public Offering and such amount of proceeds from the Initial Public Offering

that were placed in an account outside of the Trust Account for working capital purposes.

As of September 30, 2019, we had $47,270

in our operating bank accounts, $256,286,247 in securities held in the Trust Account to be used for a Business Combination or to

repurchase or redeem our ordinary shares in connection therewith and a working capital deficit of $80,945.

In addition, in February

2019, our Sponsor committed to provide us an aggregate of $300,000 in loans and in April 2019, our Sponsor committed to provide

us an additional aggregate amount of $300,000 in loans.

On September 6, 2019, we issued our Sponsor an unsecured promissory note

in a principal amount of up to $1,100,000 for working capital loans made or to be made by our Sponsor.

The Note replaced the above

commitments provided by the Sponsor.

Up to $1,000,000 of the loans under the Note may be converted into warrants.

As of September

30, 2019, there was $850,000 outstanding under the Note.

Based on the foregoing, we believe we will have sufficient cash to meet

our needs through February 20, 2020, our scheduled liquidation date.

Off-balance sheet financing arrangements

We have no obligations, assets or liabilities,

which would be considered off-balance sheet arrangements as of September 30, 2019.

We do not participate in transactions that create

relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would

have been established for the purpose of facilitating off-balance sheet arrangements.

We have not entered into any off-balance

sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or

purchased any non-financial assets.

Contractual obligations

We do not have any long-term debt, capital

lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay an affiliate of our Chief

Executive Officer a monthly fee of $15,000 for general and administrative services, including office space, utilities and administrative

services provided to the Company.

We began incurring these fees on August 15, 2018 and will continue to incur these fees monthly

until the earlier of the completion of the Business Combination and our liquidation.

Critical Accounting Policies

The preparation of financial statements

and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management

to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and

liabilities at the date of the financial statements, and income and expenses during the periods reported.

Actual results could

materially differ from those estimates.

We have identified the following critical accounting policies:

Ordinary shares subject to possible

We account for our ordinary shares subject

to possible conversion in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing

Liabilities from Equity.”

Ordinary shares subject to mandatory redemption is classified as a liability instrument and is

measured at fair value.

Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that

are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within

our control) are classified as temporary equity.

At all other times, ordinary shares are classified as shareholders’

Our ordinary shares feature certain redemption rights that are considered to be outside of our control and subject to occurrence

of uncertain future events.

Accordingly, ordinary shares subject to possible redemption are presented at redemption value as temporary

equity, outside of the shareholders’

equity section of our condensed balance sheets.

Net loss per ordinary share

We apply the two-class method in calculating

earnings per share.

Ordinary shares subject to possible redemption which are not currently redeemable and are not redeemable at

fair value, have been excluded from the calculation of basic net loss per ordinary share since such shares, if redeemed, only participate

in their pro rata share of the Trust Account earnings.

Our net income is adjusted for the portion of income that is attributable

to ordinary shares subject to redemption, as these shares only participate in the earnings of the Trust Account and not our income

As of December 31, 2019

and March 31, 2020, our principal sources of liquidity were cash of approximately $6.9 million and $10.0 million, respectively.

Working capital at March 31, 2020 was $46.8 million.

We believe our existing cash and working capital will be sufficient to meet

our working capital and capital expenditures needs over at least the next 12 months.

A majority of our

cash and cash equivalents as of March 31, 2020 were held in China, of which all denominated in Renminbi.

addition, we are a holding company with no material operations of our own.

We conduct our operations primarily through our

subsidiaries and VIEs in China.

As a result, our ability to pay dividends, if any, depends upon dividends paid by our

wholly-owned subsidiaries.

We do not anticipate paying any dividends in the future as any net income earned will be

reinvested in the company.

In addition, our WFOE is permitted to pay dividends to us only out of their retained earnings, if

any, as determined in accordance with PRC accounting standards and regulations.

Under PRC law, our WFOE and each of our

consolidated entities 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.

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.

Remittance of

dividends by a wholly foreign-owned company out of China is subject to examination by the banks designated by the SAFE.

currently plan to reinvest all earnings from our WFOE to business development and does not plan to request dividend

distributions from the WFOE.

If we experience an

adverse operating environment or incurred anticipated capital expenditure requirement, or if we accelerate our growth, then additional

financing may be required.

No assurance can be given, however, that the additional financing, if required, would be on favorable

terms or available at all.

Such financing may include the use of additional debt or the sale or additional securities.

Any financing,

which involves the sale of equity securities or instruments that are convertible into equity securities, could result in immediate

and possibly significant dilutions to our existing shareholders.

The following table

summarizes our cash flows for the periods indicated (unaudited):

Three Months Ended

(USD in the thousands)

Net cash provided by (used in) operating activities

Net cash used in investing activities

Net cash (used in) provided by financing activities

Effect of foreign exchange rates

Net (decrease) increase in cash and cash equivalents

We have primarily funded

our operations from our net revenues and bank loans.

During the past two fiscal years, our account receivables have increased and

we have had to supplement our cash flow through short-term borrowing.

For the three months ended March 31, 2020, we borrowed another

three bank loans amounting approximately $4.3 million which were all outstanding to be settled subsequently.

We intend to continue

focusing on timelier collections of account receivable which should enhance our cash flows.

We anticipate the major capital expenditure

in the near future will be around RMB85.2 million (approximately $12.0 million), which is for the further enhancement of CHEERS

Operating Activities

Net cash provided by

operating activities was $2.7 million for the three months ended March 31, 2019.

This consisted primarily of net income of $4.1

million, an decrease of prepayment in the amount of $3.9 million due to the decrease of the purchase of production content from

third party and the increase of own produce content, an increase of accounts payable of $1.3 million;

offset by an increase of

accounts receivable of $6.3 million due to the insufficient VAT invoice quota provided by local government tax authority, which

resulted into the delayed collection of accounts receivable.

Net cash used in operating

activities was $1.1 million for the three months ended March 31, 2020.

This consisted primarily of net income of $2.8 million,

a decrease of accounts payable of $0.6 million and a decrease of unamortized produced content of $0.3 million;

offset by an increase

of accounts receivable in the amount of $5.3 million as a result of slow collection of accounts receivable primarily due to the

negative impact of COVID-19 including the temporary closure of business in China and customers’

operation stagnation.

with the forecast of our customers’

business operations, we believe that the collection from our customers will accelerate

Investing Activities

Net cash used in investing

activities was $2.3 million for the three months ended March 31, 2019, which was primarily derived from the payments to the acquisition

of intangible assets.

For the three months

ended March 31, 2020, we had no investing activities.

Financing Activities

Net cash used in financing

activities was $1.5 million for the three months ended March 31, 2019, which consisted of $1.8 million repayment of bank loans,

offset by the proceeds from a third party of $0.3 million.

Net cash provided by

financing activities was $4.3 million for the three months ended March 31, 2020, which consisted of the proceeds from bank loans

of $4.3 million, and cash of $23,000 acquired from the acquisition of TKK Symphony Acquisition Corporation.

Off-Balance Sheet Arrangements

We did not have, during

the periods presented, and we do not currently have, any off-balance sheet financing arrangements or any relationships with unconsolidated

entities or financial partnerships, including entities sometimes referred to as structured finance or special purpose entities

that were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

Critical Accounting Policies and Estimates

Our discussion and analysis

of our financial condition and results of operations are based upon our consolidated financial statements.

These financial statements

are prepared in accordance with U.S.

GAAP, which requires us to make estimates and assumptions that affect the reported amounts

of our assets and liabilities and revenues and expenses, to disclose contingent assets and liabilities on the dates of the consolidated

financial statements, and to disclose the reported amounts of revenues and expenses incurred during the financial reporting periods.

The most significant estimates and assumptions include the valuation of accounts receivable, the recoverability of long-lived assets,

unamortized produced content, and revenue recognition.

We continue to evaluate these estimates and assumptions that we believe

to be reasonable under the circumstances.

We rely on these evaluations as the basis for making judgments about the carrying values

of assets and liabilities that are not readily apparent from other sources.

Since the use of estimates is an integral component

of the financial reporting process, actual results could differ from those estimates as a result of changes in our estimates.

The following critical

accounting policies rely upon assumptions and estimates and were used in the preparation of our consolidated financial statements:

Accounts Receivable, net

Accounts receivable

represent the amounts that we have an unconditional right to consideration when we have satisfied our performance obligation.

do not have any contract assets since revenue is recognized when control of the promised services is transferred and the payment

from customers is not contingent on a future event.

We maintain allowance for potential credit losses on accounts receivable.

management reviews the composition of accounts receivable and analyses historical bad debt, customer concentrations, customer credit

worthiness, current economic trends and changes in customer payment patterns to estimate the allowance.

Past due accounts are generally

written off against the allowance for bad debts only after all collection attempts have been exhausted and the potential for recovery

is considered remote.

Unamortized produced content

Produced content includes

direct production costs, production overhead and acquisition costs and is stated at the lower of unamortized cost or estimated

Produced content also includes cash expenditures made to enter into arrangements with third parties to co-produce certain

of our productions.

We use the individual-film-forecast-computation

method and amortizes the produced content based on the ratio of current period actual revenue (numerator) to estimated remaining

unrecognized ultimate revenue as of the beginning of the fiscal year (denominator) in accordance with ASC 926.

Ultimate revenue

estimates for the produced content are periodically reviewed and adjustments, if any, will result in prospective changes to amortization

When estimates of total revenues and other events or changes in circumstances indicate that a film or television series

has a fair value that is less than its unamortized cost, a loss is recognized currently for the amount by which the unamortized

cost exceeds the film or television series’

For the three months ended March 31, 2019 and 2020, $3.4 million

and $3.4 million were amortized to the cost of sales, and as of December 31, 2019 and March 31, 2020, impairment allowance of $nil

was recorded.

Impairment of Long-lived Assets

In accordance with ASC

Topic 360, we review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount

of the assets may not be fully recoverable, or at least annually.

We recognize an impairment loss when the sum of expected undiscounted

future cash flows is less than the carrying amount of the asset.

The amount of impairment is measured as the difference between

the asset’s estimated fair value and its book value.

We did not record any impairment charge for the three months ended March

31, 2019 and 2020.

Revenue Recognition

We adopted the new revenue

standard Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, on January 1, 2017.

The core principle of this new revenue standard is that a company should recognize revenue to depict the transfer of promised goods

or services to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods

The following five steps are applied to achieve that core principle:

Identify the contract with the customer

Identify the performance obligations in the contract

Determine the transaction price

Allocate the transaction price to the performance obligations in the contract

Recognize revenue when we satisfy a performance obligation

We mainly offer and

generate revenue from the copyright licensing of self-produced content, advertising and customized content production and others.

Revenue recognition policies are discussed as follows:

We self-produce or coproduce

TV series featuring lifestyle, culture and fashion, and license the copyright of the TV series on a per-episode basis to the customer

for broadcast over a period of time.

Generally, we sign a contract with a customer which requires us to deliver a series of episodes

that are substantially the same and that have the same pattern of transfer to the customer.

Accordingly, the delivery of the series

of episodes is defined as the only performance obligation in the contract.

For the TV series produced

solely by us, we satisfy our performance obligation over time by measuring the progress toward the delivery of the entire series

of episodes which is made available to the licensee for exhibition after the license period has begun.

Therefore, the copyright

revenue in a contract is recognized over time based on the progress of the number of episodes delivered.

We also coproduce TV

series with other producers and license the copyright to third-party video broadcast platforms for broadcast.

For TV series produced

by us with co-producers, we satisfy our performance obligations over time by the delivery of the entire series of episodes to the

customer, and requires the customer to pay consideration based on the number and the unit price of valid subsequent views of the

TV series that occur on a broadcast platform.

Therefore, the copyright revenue is recognized when the later of the valid subsequent

view occurs or the performance obligation relating to the delivery of a number of episodes has been satisfied.

Advertising revenue

We generate revenue

from sales of various forms of advertising on our TV series and streaming content by way of 1) advertisement displays, or 2) the

integration of promotion activities in TV series and content to be broadcast.

Advertising contracts are signed to establish the

different contract prices for different advertising scenarios, consistent with the advertising period.

We enter into advertising

contracts directly with the advertisers or the third-party advertising agencies that represent advertisers.

For contracts that involve

third-party advertising agencies, we are the principal as we are responsible for fulfilling the promise of providing advertising

services and has the discretion in establishing the price for the specified advertisement.

Under a framework contract, we receive

separate purchase orders from advertising agencies before the broadcast.

Accordingly, each purchase order is identified as a separate

performance obligation, containing a bundle of advertisements that are substantially the same and that have the same pattern of

transfer to the customer.

Where collectability is reasonably assured, revenue is recognized monthly over the service period of

the purchase order.

For contracts signed

directly with the advertisers, we commit to display a series of advertisements which are substantially the same or similar in content

and transfer pattern, and the display of the whole series of advertisements is identified as the single performance obligation

under the contract.

We satisfy our performance obligations over time by measuring the progress toward the display of the whole

series of advertisements in a contract, and advertising revenue is recognized over time based on the number of advertisements displayed.

Payment terms and conditions

vary by contract types, and terms typically include a requirement for payment within a period from 3 to 6 months.

Both direct advertisers

and third-party advertising agencies are generally billed at the end of the display period and require us to issue VAT invoices

in order to make their payments.

However, because

the local government tax authority uses a quota system to manage the VAT tax, it normally either delays the VAT invoices issued

or does not issue sufficient VAT invoices.

As such, we are not able to provide sufficient VAT invoices on a timely manner and results

in increased account receivables.

Customized content production

We produce customized

short streaming videos according to our customers’

requirement, and earn fixed fees based on delivery.

Revenue is recognized

upon the delivery of short streaming videos.

CHEERS e-Mall marketplace service

Through our CHEERS e-Mall,

an online e-commerce platform, we enable third-party merchants to sell their products to consumers in China.

We charge fees for

platform services to merchants for sales transactions completed on the CHEERS e-Mall including but not limited to products displaying,

promotion and transaction settlement services.

We do not take control of the products provided by the merchants at any point in

the time during the transactions and do not have latitude over pricing of the merchandise.

The transaction services fee is determined

as the difference between the platform sales price and the settlement price with the merchants.

The CHEERS e-Mall marketplace service

revenue is recognized at a point of time when our performance obligation to provide marketplace services to the merchants are determined

to have been completed under each sales transaction upon the consumers confirming the receipts of goods.

Payments for services

are generally received before deliveries.

We provide coupons at

our own discretion as incentives to promote the CHEERS e-Mall marketplace with a validity of usually less than two months, which

can only be used in future purchases of eligible merchandise offered on the CHEERS e-Mall to reduce purchase price that are not

specific to any merchant.

Consumers are not our customers, therefore incentives offered to consumers are not considered consideration

payable to customers.

As the consumers are required to make future purchases of the merchants’

merchandise to redeem these

coupons, we do not accrue any expense for coupons when granted and recognizes the amounts of redeemed coupons as marketing expenses

when future purchases are made.

Other Revenues

Other revenue primarily

consists of copyrights trading of purchased and produced TV-series and the sales of products on the Taobao platform.

For copyright

licensing of purchased and produced TV-series, we recognize revenue on net basis at a point of time upon the delivery of master

tape and authorization of broadcasting right.

For sales of product, we recognize revenue upon the transfer of products according

to the fixed price and production amount in sales orders.

The following table

identifies the disaggregation of our revenue for the three months ended March 31, 2019 and 2020 (unaudited), respectively:

For the three months ended

(USD in the thousands)

Category of Revenue:

Advertising revenue

Copyrights revenue

Customized content production revenue

CHEERS e-Mall marketplace service revenue

Other revenue

Timing of Revenue Recognition:

Services transferred over time

Services transferred at a point in time

Goods transferred at a point in time

We applied a practical

expedient to expense costs as incurred for costs to obtain a contract with a customer when the amortization period would have been

one year or less.

We do not have any significant incremental costs of obtaining contracts with customers incurred and/or costs

incurred in fulfilling contracts with customers within the scope of ASC Topic 606, that shall be recognized as an asset and amortized

to expenses in a pattern that matches the timing of the revenue recognition of the related contract.

Recent Accounting Pronouncements

Management does not believe that any recently

issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our condensed financial

In June 2016, the Financial

Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No.

2016-13, “Measurement

of Credit Losses on Financial Instruments (Topic 326)”, which significantly changes the way entities recognize impairment

of many financial assets by requiring immediate recognition of estimated credit losses expected to occur over their remaining life,

instead of when incurred.

In November 2018, the FASB issued ASU No.

2018-19, “Codification Improvements to Topic 326, Financial

Instruments—Credit Losses”, which amends Subtopic 326-20 (created by ASU No.2016-13) to explicitly state that operating

lease receivables are not in the scope of Subtopic 326-20.

Additionally, in April 2019, the FASB issued ASU No.2019-04, “Codification

Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial

Instruments”, in May 2019, the FASB issued ASU No.

2019-05, “Financial Instruments—Credit Losses (Topic 326):

Targeted Transition Relief”, and in November 2019, the FASB issued ASU No.

2019-10, “Financial Instruments—Credit

Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842):

Effective Dates”, and ASU No.

2019-11, “Codification

Improvements to Topic 326, Financial Instruments—Credit Losses”, to provide further clarifications on certain aspects

2016-13 and to extend the nonpublic entity effective date of ASU No.

The changes (as amended) are effective

for the annual and interim periods of our fiscal years beginning after December 15, 2022, and we are in the process of evaluating

the potential effect on our consolidated financial statements.

In December 2019, the

FASB issued ASU No.

2019-12, “Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes”

(“ASU 2019-12”),

which is intended to simplify various aspects related to accounting for income taxes.

ASU 2019-12 removes certain exceptions to

the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application.

This guidance

is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption

We are currently assessing the impact of adopting this standard, but based on a preliminary assessment, we do not expect

the adoption of this guidance to have a material impact on our consolidated financial statements.

Other accounting standards

that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material

impact on the consolidated financial statements upon adoption.

We do not discuss recent pronouncements that are not anticipated

to have an impact on or are unrelated to our consolidated financial condition, results of operations, cash flows or disclosures.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements