Purchase Agreement - Form 6-K

As previously disclosed, on May 16, 2023, MMTec, Inc., a British Virgin Islands company ("MMTec" or the "Company"), entered into an Equity Acquisition Agreement (the "Purchase Agreement") with Alfa Crest Investment Limited, a British Virgin Islands company ("Alfa Crest"), CapitoLabs Limited, a British Virgin Islands company ("CapitoLabs", and together with Alfa Crest, the "Sellers") and Alpha Mind Technology Limited, a British Virgin Islands company ("Target" or "Alpha Mind"). Pursuant to the Purchase Agreement, the Sellers agreed to sell and MMTEC agreed to purchase, the Sellers' shares of Target's issued and outstanding ordinary shares, which represent an 85% ownership stake in Target, for aggregate purchase price of $99,650,000 (the "Purchase Price").

The transactions contemplated in the Purchase Agreement closed on June 7, 2023. In accordance with the Purchase Agreement, the $1.0 million good faith deposit previously made by MMTec was credited towards the Purchase Price. In addition, at closing, MMTec paid the sellers an aggregate of $91,650,000 in cash, and issued to the sellers a senior convertible promissory note (the "Note") for the remaining $7.0 million of the Purchase Price. The Note accrues interest at 1% per annum and matures 24 months following the effective date. The Note is convertible at any time and the conversion price will be calculated with a discount of fifty-four percent (54%) to the lowest closing price of the last twenty (20) trading days immediately prior to the date of the conversion notice.

Alpha Mind, through its variable interest entity (VIE) subsidiaries, has two primary business units: (a) an insurance agency, and (b) an insurance technology business. The insurance agency operates nationwide in the People's Republic of China (PRC) with a wide range of insurance products, including but not limited to property insurance, homeowner's insurance, life insurance, health insurance, business insurance and worker's compensation insurance. The insurance agency is PRC-licensed and works with around 180 insurance carriers. The insurance technology business is focused on operating and developing next generation insurance tech products in the PRC, including developing SaaS platforms to interface with both consumers and underwriting support and exploring the implementation of artificial intelligence in the insurance technology space. The Company believes that Alpha Mind's business units parallel MMTec's existing businesses, operating with similar fee arrangements, objectives and technology focuses. Through the acquisition of Alpha Mind, MMTec looks to capitalize on these parallels and to expand its overall focus in the PRC financial industry from investment banking and asset management business to also include insurance.

The foregoing description of the Note is qualified in its entirety by reference to the full text of the Note, a copy of each of which is filed as Exhibit 10.1 hereto and is incorporated herein by reference.

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