MMTEC created fund to price $120 million six-year convertible notes

By Abigail W. Adams

Portland, Me., Aug. 9 – MMTEC Inc. plans to create an investment fund managed by subsidiary MM Capital that will price $120 million of six-year convertible notes in a Regulation S offering, according to a company news release.

The convertible notes will be convertible into MMTEC’s common shares at a conversion price of $8.50 per share.

The investment fund will acquire a yet-to-be determined broker-dealer in the United States and invest in China-based business.

The notes will be putable if the net asset value of the investment fund is less than 85% of its value at the time of its acquisition with the NAV determined through an annual audit.

The fund will liquidate at the time of the convertible note’s maturity.

Noteholders who chose to convert their notes will receive distributions of the fund’s income in an amount equal to their pro rata share of 50% of the fund minus a 2% management fee, according to the release.

Noteholders that have their notes paid in cash will receive an additional payment of 20% of the fund’s income minus a 2% management fee.

MMTEC is a Beijing-based technology company that provides access to U.S. financial markets.

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