TKAT Takung Art Co Ltd

On February 16, 2022, Takung Art Co., Ltd., a Delaware corporation (the “Company”) entered into certain securities purchase agreement (the “Feb 16 SPA”) with certain “non-U.S. Persons” (the “Purchasers”) as defined in Regulation S of the Securities Act of 1933, as amended (the “Securities Act”), pursuant to which the Company agreed to sell 11,770,240 units, each consisting of one share of the common stock of the Company, par value $0.001 per share (the “Common Stock”) and a warrant to purchase three shares of Common Stock. The purchase price of each Unit is $2.5488. The gross proceeds to the Company from this offering will be approximately $30 million.

Upon further discussion among the parties, on February 23, 2022, the Company and the Purchasers agreed to terminate the Feb 16 SPA pursuant to certain Termination Agreement and entered into a new securities purchase agreement (the “Feb 23 SPA”). The Feb 16 SPA and the Feb 23 SPA are substantially on the same terms except the per Unit purchase price. Pursuant to the Feb 23 SPA, the Company agreed to sell 11,952,190 units (the “Units”), each consisting of one share of Common Stock (the “Shares”) and a warrant (the “Warrant”) to purchase three shares of Common Stock. The purchase price of each Unit is $2.51. The gross proceeds to the Company from this offering will be approximately $30 million.

The issuance and sale of the Units is exempted from the registration requirement of the Securities Act pursuant to Regulation S promulgated thereunder.

The Warrants are exercisable at any time after the six-month anniversary of the issuance date at an initial exercise price of $3.1375 for cash (the “Warrant Shares”). The Warrants may also be exercised cashlessly if at any time after the nine-month anniversary of the issuance date, there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares. The Warrants shall expire five and a half years from its date of issuance. The Warrants are subject to customary anti-dilution provisions reflecting stock dividends and splits or other similar transactions.

The parties to the Feb 23 SPA have each made customary representations, warranties and covenants, including, among other things, (a) the Investors are “non-U.S. Persons” as defined in Regulation S and are acquiring the Units for the purpose of investment, (b) the absence of any undisclosed material adverse effects, and (c) the absence of legal proceedings that affect the completion of the transaction contemplated by the Feb 23 SPA.

The Feb 23 SPA is subject to various conditions to closing including NYSE American’s completion of its review of the notification to NYSE American regarding the listing of the Units. The Units to be issued in the Offering are exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Regulation S promulgated thereunder.

The net proceeds of this offering shall be used by the Company in connection with the Company’s general corporate purposes, working capital, or other related business as approved by the board of directors of the Company.

The forms of the Feb 23 SPA and Warrant and the Termination Agreement dated February 23, 2022 are filed as Exhibits 10.1, 10.2 and 10.3 to this Current Report on Form 8-K, respectively, and such documents are incorporated herein by reference. The foregoing is only a brief description of the material terms of the Feb 23 SPA the Warrant, and the Termination Agreement does not purport to be a complete description of the rights and obligations of the parties thereunder and are qualified in their entirety by reference to such exhibits.