UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 8-K

 

 

 

CURRENT REPORT

 

Pursuant to Section 13 OR 15(d) of the

Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): August 24, 2016

 

TAKUNG ART CO., LTD 

(Exact name of registrant as specified in its charter)

 

 

 

         
Delaware  

000-55500  

  26-4731758

(State or other jurisdiction

of incorporation)

 

 

(Commission

File Number)

 

 

(IRS Employer

Identification No.)

 

 

Flat/RM 03-04 20/F Hutchison House

10 Harcourt Road, Central Hong Kong

(Address of Principal Executive Offices)

 

Registrant’s telephone number: +852 3158 0977

 

________________________________________________

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see  General Instruction A.2. below):

 

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

 

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

 

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

 

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

 

 

 

 

 

Item 1.01 Entry into a Material Definitive Agreement.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

 

 

On August 24, 2016, our Hong Kong subsidiary, Hongkong Takung Assets and Equity of Artworks Exchange Co., Ltd. (Hong Kong Takung”) entered into a loan agreement with Merit Crown Limited, a Hong Kong company to borrow US$2 million to meet its working capital needs (“US Dollar Loan”). Interest shall accrue at a rate of 8% per annum pro-rated to the actual loan period, which shall be from the date the loan amount is made through December 31, 2016.

 

Also on August 24, 2016, our PRC subsidiary, Takung (Shanghai) Co., Ltd entered into an interest- free loan agreement to lend an individual, Xiaohui Wang, a national of the People’s Republic of China RMB13.35 million (equivalent to US$2 million) for the same duration as the aforementioned loan (“RMB Loan”). This loan is guaranteed by Chongqing Wintus (New Star) Enterprises Group and Mr. Wang is a shareholder and the legal representative of it.

 

The US Dollar Loan is to provide Hong Kong Takung with sufficient US Dollar-denominated currency to meet its working capital requirements. It is “secured” by the RMB Loan of equivalent amount by its subsidiary to an individual and guarantor affiliated with the lender of the US Dollar Loan. It is the understanding between the parties that when the US Loan is repaid, the RMB Loan will similarly be repaid.

 

On August 25, 2016, Hong Kong Takung entered into a loan agreement with Jianping Mao (“Mao”), the wife of the Vice General Manager of Hong Kong Takung for the loan of HK$18,000,000 to Hong Kong Takung. Interest shall accrue at a rate of 8% per annum pro-rated to the actual loan period, which shall be from the date the loan amount is made through December 31, 2016. The loan is to provide Hong Kong Takung with sufficient Hong Kong Dollar-denominated currency to meet its working capital requirements.

 

As we have determined the Hong Kong dollar loan to be a “related party transaction”, our Audit Committee has reviewed and recommended for approval and our Board of Directors has approved the loan on August 22, 2016.

 

The foregoing description of the various loan agreements does not purport to be complete and is qualified in its entirety by the loan agreements, a copy of which are attached as Exhibits 10.1, 10.2 and 10.3 to this Current Report on Form 8-K and are incorporated herein by reference.

 

The information in this Current Report on Form 8-K (the “Form 8-K”) is being “furnished” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date of this Form 8-K, except as shall be expressly set forth by specific reference in such filing. The information in this Form 8-K will not be deemed an admission as to the materiality of any information in this Form 8-K that is required to be disclosed solely by Regulation FD.

 

 

 

 

Item 9.01 Financial Statements and Exhibits

 

(d) Exhibits

  

  Exhibit No. Description
     
  10.1 Loan Agreement between Hongkong Takung Assets and Equity of Artworks Exchange Co., Ltd. and Merit Crown Limited dated August 24. 2016.
     
  10.2 Loan Agreement between Takung (Shanghai) Co., Ltd, Xiaohui Wang and Chongqing Wintus (New Star) Enterprises Group dated August 24, 2016.
     
  10.3 Loan Agreement between Hongkong Takung Assets and Equity of Artworks Exchange Co., Ltd. and Jianping Mao dated August 25. 2016.

 

 

 

 

SIGNATURES

 

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

 

     
    Takung Art Co., Ltd
   
Date: August 30, 2016    
   
   

/s/ Di Xiao 

    Name: Di Xiao
    Title: Chief Executive Officer and Director

 

 

 

 

 

 

Exhibit 10.1

 

Loan Agreement

 

Lender: Merit Crown Limited (a company registered in Hong Kong, company No.: 2174556).

 

Borrower: Hongkong Takung Assets and Equity of Artworks Exchange Co., Ltd. (a company registered in Hong Kong, company No.: 1801348).

 

The two parties enter into this Agreement after full consultations.

 

Article 1. The Borrower borrows US$2 million (Two Million US Dollars) from the Lender to meet the Borrower’s working capital needs. The loan period shall commence from the date when the Lender pays the full amount to the Borrower after deduction of the interest according to Article 2 (tentatively 24 August 2016) and end on 31 December 2016.

 

Article 2. The Borrower shall pay interest to the Lender at the annual interest rate of 8% based on the actual loan period. The interest for the actual loan period shall be paid on the commencement date of the loan period, and will be deducted from the loan amount by the Lender.

 

Article 3. Upon expiry of the loan period, the Borrower shall repay the principal to the Lender in a lump sum at the amount of US$2 million (Two Million US Dollars). The parties can agree in advance to shorten or extend the loan period.

 

Article 4. This Agreement has two original copies, each of the Lender and the Borrower will keep one original copy, which shall have equal legal effect.

 

Article 5. This Agreement shall take effect on the date when the two parties sign thereon.

 

Lender:

Date: 24 August 2016

Borrower:

Date: 24 August 2016

 

 

 

Exhibit 10.2

 

Loan Agreement

 

Lender: Takung (Shanghai) Co., Ltd. (a company registered in the People’s Republic of China, registration No.: 310141400028740)

 

Borrower: Xiaohui Wang, Exit-Entry Permit for Traveling to and from Hong Kong and Macau No.: C25469808

 

Guarantor: Chongqing Wintus (New Star) Enterprises Group (a company registered in the People’s Republic of China, registration No.: 500103000048186)

  

The three parties enter into this Agreement after full consultations.

  

Article 1. The Borrower borrows RMB13,350,000 (equivalent to US$2 million) from the Lender to meet the Borrower’s working capital needs. The loan period shall commence from the date when the Lender pays the full amount to the Borrower (tentatively 24 August 2016) and end on 31 December 2016.

  

Article 2. The Borrower shall pay interest to the Lender at the annual interest rate of 0% based on the actual loan period.

  

Article 3. Upon expiry of the loan period, the Borrower shall repay the principal and interest to the Lender in a lump sum. The parties can agree in advance to shorten or extend the loan period.

  

Article 4. The Borrower designates the following account as the loan account. The loan is deemed to have been provided once it is transferred into the loan account by the Lender. The Borrower and the Guarantor warrants that the funds will be legally transferred and used, and shall be solely responsible for the relevant legal liabilities.

 

Name of account holder: Chongqing Wintus (New Star) Enterprises Group

 

 

 

 

Account opening bank: Beipei Sub-branch, Chongqing Branch, China Construction Bank

 

Account No.: 50001093600050207739

  

Article 5. The Guarantor shall be jointly responsible for all repayment liabilities of the Lender under this Agreement, including without limitation to the principal, interest and all costs in relation to collection of debts.

  

Article 6. This Agreement has three original copies, each of the Lender, the Borrower and the Guarantor will keep one original copy, which shall have equal legal effect.

  

Article 7. This Agreement shall take effect on the date when the three parties sign thereon.

  

Lender:

 

Date: 24 August 2016

 

 

 

 

Borrower:

 

Date: 24 August 2016

 

Guarantor:

 

Date: 24 August 2016

 

 

 

 

Exhibit 10.3

 

LOAN AGREEMENT

 

 

 

 

THIS LOAN AGREEMENT (this " Agreement ") dated this 25 th day of August 2016 (the “ Effective Date ”) is entered into by and between Jianping Mao (holder of Hong Kong ID No.:) of _____________________________________, (the “ Lender ”) of the first part, and Hongkong Takung Assets and Equity of Artworks Exchange Co., Ltd., a limited liability company registered in Hong Kong with place of business at Room 03-04, 20/F, Hutchison House, 10 Harcourt Road, Central, Hong Kong(the “ Borrower ”) of the second part.

 

本贷款协议(“ 本协议 ”)由毛建萍(持有香港身份证号码: _________________ ,地址为 _____________________________________ )(“ 出借方 ”)作为一方,及香港大公文化艺术品产权交易所有限公司(一家在香港注册的有限责任公司,办事处地址为香港中环夏悫道 10 号和记大厦 20 03-04 室)(“ 借款方 ”)作为另一方,于 2016 8 25 日(“ 生效日期 ”)订立。

   

BACKGROUND :

 

背景:

   

The Lender holds not more than 5% of the outstanding shares in Takung Art Co., Ltd. (the parent company of the Borrower) as of 15 August 2016, and hereby agrees to lend HK$18,000,000 (Eighteen Million Hong Kong Dollars) (the “ Loan ”) to the Borrower on the terms and conditions set out below for the Borrower’s working capital use.

 

出借方于 2016 8 15 日持有 Takung Art Co., Ltd. (借款方的母公司)不超过 5% 的流通股份,并兹此同意根据以下条款及细则向借款方借出 18,000,000 港元(一千八百万港元)(“ 贷款 ”),供借款方作营运资金用途。

   

In consideration of the Lender providing the Loan to the Borrower, and the Borrower agreeing to repay the Loan to the Lender, and other good and valuable consideration, the sufficiency of which is acknowledged, both parties agree to keep, perform, and fulfill the promises, conditions and agreements below:

 

以出借方向借款方提供贷款,及借款方同意向出借方偿还贷款,以及其它完备及有价值的代价为代价(各方已确认代价为足够),双方同意维持、履行及实行承诺、条件及协议如下:

 

 

1  

 

 

1. Loan Amount & Interest . The Lender promises to lend the Loan to the Borrower and the Borrower promises to repay this principal amount and the interest thereof at the annual interest rate of 8% calculated from the drawdown date of 25 August 2016 (the date when the Loan is deposited into the designated account of the Borrower) to the actual repayment date (the date when the principal amount of the Loan and the interest thereof is repaid) to the Lender or its designee.

 

贷款金额及利息 。出借方承诺向借款方借出贷款,而借款方承诺向出借方或其指定人士偿还贷款的本金和利息,利息按 8% 的年利率计算,自提取日 2016 8 25 日(贷款存入借款方指定账户之日)起算至实际还款日期(偿还贷款本金和利息之日)。

   

2. Re-payment . The Borrower shall repay the Lender HK$10,000,000 (Ten Million Hong Kong Dollars) and the interest thereof three months after the Effective Date, and HK$8,000,000 (Eight Million Hong Kong Dollars) and the interest thereof by 31 December 2016.

 

还款 。借款人应于生效日期起满三个月时向出借方偿还 10,000,000 港元(一千万港元)及其利息,并在 2016 12 31 日或之前向出借方偿还 8,000,000 港元(八百万港元)及其利息。

  

3. Default . Notwithstanding anything to the contrary in this Agreement, if the Borrower defaults in the performance of any obligation under this Agreement, then the Lender may declare the principal amount owing under this Agreement at that time to be immediately due and payable.

 

违约 。即使本协议有任何相反规定,如借款方未能履行本协议项下任何义务,则出借方可声明当时根据本协议所欠本金即时到期应付。

 

4. Costs . All costs, expenses and expenditures including, and without limitation, the complete legal costs incurred by enforcing this Agreement as a result of any default by the Borrower, will be added to the principal then outstanding and will immediately be paid by the Borrower. Except in the case of fraud or gross negligence, the director(s) of the Borrower shall not be personally liable for any default in repayment of the Loan or the interest thereof.

 

费用 。所有费用、开支及支出(包括但不限于因借款方任何违约而强制实施本协议所产生的全部律师费),将加到当时尚欠的本金中,并应由借款方即时支付。除非在欺诈或严重疏忽的情况下,借款方的董事不会就任何未能偿还贷款或其利息而承担个人责任。

 

 

2  

 

 

5. Severability . The clauses and paragraphs contained in this Agreement are intended to be read and construed independently of each other. If any part of this Agreement is held to be invalid, such invalidity will not affect the operation of any other part of this Agreement.

 

可分性 。本协议所载条款及段落应各自独立阅读和解释。如本协议任何部分被判定为无效,该无效不会影响本协议任何其它部分的效力。

  

6. Governing Law and Jurisdiction . This Agreement will be construed in accordance with and governed by the laws of Hong Kong. The parties hereby submit to the non-exclusive jurisdiction of the courts of Hong Kong.

 

管辖法律及司法管辖权 。本协议将根据香港法律诠释并受香港法律管辖。双方就本协议相关争议事宜提交香港法院非专属司法管辖。

  

IN WITNESS WHEREOF the parties hereto have hereunto duly executed this Agreement as of the day and year first above written.

 

双方于上述日期妥为签署本协议。

  

 

Lender

 

出借方

 

 

 

_________________

 

 

 

 

 

Borrower

 

借款方

 

 

 

_________________

 

XIAO Di, Director

 

肖笛,董事

 

For and on behalf of

 

Hongkong Takung Assets and Equity of Artworks Exchange Co., Ltd.

 

代表香港大公文化艺术品产权交易所有限公司

 

 

 

 

 

3