DOW JONES27,960.80-1031.61 -3.56%
S&P 5003,225.89-111.86 -3.35%
NASDAQ9,221.28-355.31 -3.71%

BOQI Reports Amended Terms For Purchase Of Boqi Zhengji Pharmacy

BOQI International Medical Inc. (NASDAQ:BIMI) (“BIMI” or the “Company”) today announced that it has signed an Amendment to Stock Purchase Agreement for the acquisition of Boqi Zhengji Pharmacy

Benzinga · 02/07/2020 13:32

BOQI International Medical Inc. (NASDAQ:BIMI) (“BIMI” or the “Company”) today announced that it has signed an Amendment to Stock Purchase Agreement for the acquisition of Boqi Zhengji Pharmacy Chain Co., Ltd (“Boqi Pharmacy”) (the “Amendment”). The Amendment contemplates substantial changes to the mechanism for the adjustment to the post-closing consideration.

According to the original purchase agreement signed on April 11, 2019, the aggregate purchase price for the shares of Boqi Pharmacy (or Boqi Pharmacy’s parent) consists of a cash consideration of RMB 40,000,000 (currently approximately US$5,714,285) (the “Target Cash Consideration”)and 1,500,000 shares of common stock of the Company. The Target Cash Consideration is subject to post-closing adjustment according to the appraised value of Boqi Pharmacy. 

Pursuant to the Amendment, the Target Cash Consideration shall be adjusted according to the performance of Boqi Pharmacy in 2020. Specifically, if Boqi Pharmacy has at least 100,000 member customers as of December 31, 2020 (the “Target Customer Number”) and achieves a gross profit of at least RMB 20,000,000 (currently approximately US$2,857,142) in 2020 (the “Target Profit Amount”), the Company will pay the full amount of the Target Cash Consideration. If, however, either the Target Customer Number or the Target Profit Amount is not met, the Target Cash Consideration will be adjusted downward based on the actual performance comparing to the targets. In the event Boqi Pharmacy’s gross profit in 2020 is zero or a negative number, the Target Cash Consideration will not be paid.

The Amendment emphasizes the importance of Boqi Pharmacy’s performance, growth potential and profit-generation ability in determining the value of the acquisition, while creating a possibility of reducing the Company’s acquisition costs significantly.