CHINA JO-JO DRUGSTORES, INC. (NASDAQ:CJJD) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
As disclosed on a prior Current Report on Form 8-K filed on
January 4, 2017 (the Prior Filing), China Jo-Jo Drugstores, Inc.
(the Company) entered into a Securities Purchase Agreement (the
Purchase Agreement) with CareRetail Holdings Limited, an exempt
company incorporated under the laws of the Cayman Islands (the
Investor) to which the Company agreed to sell to the Investor,
and the Investor agreed to purchase from the Company, through a
private placement, an aggregate of 4,840,000 shares (the Shares)
of the common stock, par value $0.001 per share, of the Company,
at a purchase price of $2.20 per share, for aggregate gross
proceeds to the Company of $10,648,000 (the Private Placement).
The Private Placement closed on January 23, 2017 (the Closing).
The foregoing description of the Purchase Agreement does not
purport to be complete and is qualified in its entirety by
reference to the Purchase Agreement attached as Exhibit 10.1 to
the Prior Filing, which is incorporated herein by reference.
On January 18, 2017, Hangzhou Jiuzhou Grand Pharmacy Chain Co.,
Ltd. (Jiuzhou), a company organized under the laws of the Peoples
Republic of China, a variable interest entity of the Company,
entered into a joint venture agreement (the JV) with the
Investors designated entity, CareRetail (HK) Holdings Limited
(CareRetail HK) to which CareRetail HK shall have 51% equity
interests of the JV and Jiuzhou shall have the remaining 49%
equity interests. The total registered capital of the JV is
$1,600,000, to be contributed by both parties based on their
ownership percentages in the JV by December 31, 2019. The JV is
in the business of management and consulting in the industry of
non-medical care management and consulting, wholesale and retail
of certain categories of medical devices and others subject to
the scope to be set forth in its business license.
Item 3.02 Unregistered Sales of Equity
In connection with the Closing, to the Purchase Agreement and the
transactions contemplated thereby described in Item 1.01 above,
the Company issued the Shares to the Investor. The Company issued
such securities in reliance on the exemption from Section 5 of
the Securities Act of 1933, as amended contained in Rule 903 of
Regulation S thereunder, as the offer and sale of the Shares was
made outside of the United States. At the time of the offer of
the Shares and the execution of the Purchase Agreement, the
Investor is outside of the United States. The Investor is not a
U.S. Person as such term is defined under Rule 902 of Regulation
S. No directed selling efforts, as such term is defined under
Rule 903 of Regulation S was made by the Company or any person
acting on its behalf. An appropriate legend has been affixed to
the certificate for the Shares.
About CHINA JO-JO DRUGSTORES, INC. (NASDAQ:CJJD)
China Jo-Jo Drugstores, Inc. is a retailer and distributor of pharmaceutical and other healthcare products found in a retail pharmacy in the People’s Republic of China. The Company’s segments include retail drugstores, online pharmacy, drug wholesale and herb farming. The retail drugstores segment sells prescription and over-the-counter (OTC) medicines, traditional Chinese medicine (TCM), dietary supplement, medical devices and sundry items to retail customers. Its online pharmacy segment sells OTC drugs, dietary supplement, medical devices and sundry items to customers through Alibaba’s Tmall and its own platform all over China. The drug wholesale segment supplies its own retail drugstores with prescription and OTC medicines, TCM, dietary supplement, medical devices and sundry items, and also sells them to other drug vendors and hospitals. Its herb farming segment cultivates selected herbs for sales to other drug vendors. It is also involved in online sales and clinic services. CHINA JO-JO DRUGSTORES, INC. (NASDAQ:CJJD) Recent Trading Information
CHINA JO-JO DRUGSTORES, INC. (NASDAQ:CJJD) closed its last trading session down -0.03 at 1.80 with 68,368 shares trading hands.