6-K
Farmmi, Inc. (FAMI)
UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TORULE 13a-16 OR 15d-16UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 2021
Commission File Number: 001-38397
Farmmi, Inc.
(Translation of registrant’s name into English)
Fl1, Building No. 1, 888 Tianning Street, Liandu District
Lishui,Zhejiang Province
People’sRepublic of China 323000
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨
EXPLANATORY NOTE
ExplanatoryNote:
On November 5, 2021, the Registrant issued a press release announcing that the Company has agreed to purchase 124,590,064 shares of Shanghai Jiaoda Onlly Co., Ltd. (“Jiaoda Onlly”), a Shanghai Stock Exchange listed company under the ticker 600530.SH, from current shareholders of Jiaoda Onlly. Jiaoda Onlly operates elderly care institutions and engages in the research and development, production and sale of health food. The Registrant, through one of its subsidiaries, Zhejiang Yitang Medical Service Co., Ltd. (“Yitang"), will purchase the shares of Jiaoda Onlly from China Capital Investment (Group) Co., Ltd. (CCIG) and its affiliates for approximately RMB 509 million (approximately US$79.8 million). This will make Yitang the second largest shareholder of Jiaoda Onlly, with approximately 16% of Jiaoda Onlly’s total shares. Closing on the purchase agreement is subject to ordinary closing conditions, including release of certain pledges and encumbrances.
The Equity Transfer Framework Agreement is attached as Exhibit 10.1, and the related press release is attached as Exhibit 99.1 to this Report on Form 6-K.
EXHIBIT INDEX
| Exhibit | Description |
|---|---|
| 10.1 | English<br> translation of Equity Transfer Framework Agreement dated November 5, 2021 |
| 99.1 | Press<br> release dated November 5, 2021 |
SIGNATURE
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, thereunto duly authorized.
| Farmmi, Inc. | ||
|---|---|---|
| Date: November 5, 2021 | By: | /s/ Yefang Zhang |
| Yefang Zhang | ||
| Chief Executive Officer |
Exhibit 10.1
Equity Transfer Framework Agreement
Party A (transferor)
Party A 1: China Capital Investment (Group) Co., Ltd.
Unified Social Credit Code: 9131000063132153X4
Legal representative: Chuanyou Zhou
Address: 20th Floor, No. 333, Caoxi North Road, Xuhui District, Shanghai
Party A 2: Shanghai CCI Investment Co., Ltd
Unified Social Credit Code: 91310115132275532U
Legal representative: Chuanyou Zhou
Address: 20th Floor, No. 333, Caoxi North Road, Xuhui District, Shanghai
Party A 3: Shanghai Hengshi Investment Management Co., Ltd.
Unified Social Credit Code: 91310115667796780P
Legal representative: Chuanyou Zhou
Address: Room 603A-8, No.1988，Dongfang Road, Pudong Xinqu District
Party A 4: Xinjiang Huizhong Yifu Investment Co., Ltd.
Unified Social Credit Code: 9165010067023333X8
Legal representative: Chengye Hu
Address: Office 1, 25th Floor, Building 1, Urban Construction Building, No. 133, Nanhu Road, Shuimogou District, Urumqi, Xinjiang.
Party B (transferee): Zhejiang Yitang Medical Service Co., Ltd.
Unified social credit code: 91330109MA2KKBYD06
Legal representative: Dehong Zhang
Address: Room 1306, 13th Floor, Building 1, Jiangning Building, No. 27, Ningtai Road, Ningwei Street, Xiaoshan District, Hangzhou City, Zhejiang Province
(Party A and Party B are collectively referred to as "Parties", Party A 1, Party A 2, Party A 3, Party A 4 are collectively referred to as "Party A")
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This agreement is signed by the parties in Changning District, Shanghai, China dated November 5, 2021.
Whereas：
Shanghai Jiaoda Onlly Co., Ltd. (hereinafter referred to as the "target company") (stock code: 600530) is a legally established and legally existing joint-stock company, domiciled at No. 666, Huancheng Road, Songjiang District, Shanghai, unified social credit code is 9131000013412536XD.
Party A is a legally established and legally existing limited liability company, and jointly holds 124,590,064 shares of the target company, with a shareholding ratio of 15.97%.
The Parties agree as follows:
Article 1 Target shares and transfer price
| 1. | Target shares: Party A transfers 124,590,064 shares of the target company to Party B by means of agreement<br>transfer or other means agreed upon by both parties to sell unrestricted tradable shares of the target company (accounting for 15.97%<br>of the total number of shares of the target company) and the resulting ownership rights and interests (Including all the attached rights<br>and rights under these shares) (hereinafter referred to as the "underlying shares"), Party B is willing to accept these shares.<br>(Hereinafter referred to as "this share transfer"). |
|---|---|
| 2. | Transfer price: The two parties agree that the price is approximately RMB 4.09 yuan per share, and<br> the total price is RMB 509,655,288. The final transfer price shall be agreed in the formal equity transfer agreement. |
| --- | --- |
Article 2 Prerequisites for this share transfer
| 1. | This agreement has been officially signed and entered into<br>force. |
|---|---|
| 2. | This transaction has been approved by Party A’s competent<br>authority. |
| --- | --- |
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Article 3 The steps of this share transfer
| 1. | On or Before November 5, 2021, Party B shall pay the equity transfer amount of RMB 50 million to the account<br>designated by Party A. |
|---|---|
| 2. | Before December 30, 2021, Party A and its concerted actors shall jointly establish a joint account with<br>Party B. On or before January 30, 2022, Party A and its concerted actors and Party B shall sign a formal equity transfer agreement for<br>this share transfer. On or before January 30, 2022, the remaining amount RMB 459,655,288 shall be paid to the joint account (The deposit<br>and withdrawal of this account are only in accordance with Party B's own instructions). |
| --- | --- |
| 3. | Both parties agree that the equity transfer funds in the joint account can be used to the pledge of the<br>underlying shares, so the transfer registration procedures will be facilitated. Both parties confirm that after Party B has paid the full<br>amount of the equity transfer funds to the joint account pursuant to Article 2 of the agreement, the removal of the pledge and the guarantee<br>cancellation procedures for the underlying shares will be completed within seven working days. Both parties will cooperate and complete<br>the pledge removal as soon as possible |
| --- | --- |
| 4. | After the joint account receives all the amount for share transfer and the removal of the pledge of the<br>target shares, the target shares shall be registered with Party B within five trading days. After the target shares are registered in<br>the name of Party B, Party B shall transfer the remaining equity transfer amount from joint account to Party A’s designated account<br>within two working days. |
| --- | --- |
Article 4 Corporate Governance ArrangementsAfter the Share Transfer
After both Parties complete the share transfer and registration of the target shares, Party B has the right to appoint the directors, supervisors and management personnel of the target company in accordance with the articles of association of the target company.
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Article 5 Protective Clauses
The Parties confirm that after the signing of this agreement until January 30, 2022, Party A shall not engage in any negotiation with any third party other than Party B or its designated party regarding the share transfer.
Article 6 Liability for breach of contract
| 1. | If Party B fails to pay the equity transfer payment in time or Party B fails to pays the equity transfer<br>payment to the joint account in time, or Party B fails to transfer the amount from the joint account to Party A’s designated account,<br>Party B shall pay one tenth of one percent (0.1%)of the unpaid amount daily. |
|---|---|
| 2. | If Party B unilaterally terminates the transfer of the underlying shares or unilaterally terminates this<br>agreement, or any payment overdue by Party B over 30 days (including Party B’s failure of the payment for share transfer or Party<br>B’s failure of the transfer of the amount from the joint account to Party A’s designated account), Party B shall pay Party<br>A 20% of the total equity transfer price as penalty. The penalty can be paid via deducting from the deposit Party B has paid, and the<br>balance shall be paid by Party B within the time period notified by Party A, and Party A has the right to terminate this agreement. If<br>Party A chooses to terminate this agreement, this agreement shall be terminated upon the receipt of the notice of the termination notice.<br>If Party A unilaterally terminates the transfer of the target shares or unilaterally terminates this agreement, Party A shall refund the<br>deposit paid by Party B, and Party A shall pay Party B 20% of the total equity transfer price as liquidated damages, and Party B has the<br>right to choose to terminate this agreement. If Party B chooses to terminate this agreement, this agreement shall be terminated upon the<br>receipt of the termination notice of Party A. |
| --- | --- |
| 3. | The non-breaching party has the right to exempt the breaching party from the liability for breach of contract. |
| --- | --- |
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Article 7 Confidentiality
Without the unanimous written consent of both parties, neither party shall disclose any content of this agreement and any information related to this agreement to any third party until the relevant information has been publicly disclosed. If any party violates the confidentiality obligations stipulated in this article, it shall compensate the observing party and its related parties for all losses.
Article 8 Effective, modification and terminationof the agreement
| 1. | This agreement will take effect on the day when Party A and Party B affix their official seals. This agreement<br>is in six copies, each party holds one copy, and the target company keeps one copy. |
|---|---|
| 2. | This agreement is only a framework agreement, and the details will be specified in the final formal equity<br>transfer agreement |
| --- | --- |
| 3. | This agreement will automatically be terminated upon the effective of the formal equity transfer agreement. |
| --- | --- |
Article9 Notification
| 1. | Any notice provided by either party of this agreement to the other party shall be written in Chinese and<br>sent out in writing. |
|---|---|
| 2. | When the notification is sent by e-mail, the delivery time is when the data message is sent to the communication<br>terminal; if it is delivered by hand, the delivery time is when the recipient receives the notification; if it is sent by mail, the fifth<br>(5) working day after mailing will be the deemed delivery time. If the receiving party refuses to receive it, it shall be deemed to have<br>been delivered, and the date of rejection indicated on the mailing or delivery receipt shall be the date of delivery. |
| --- | --- |
| 3. | All written notices sent to other parties shall be sent to the following address. Any party changing the<br>address and communication method shall notify the other party three (3) working days in advance. If the other party’s notification<br>of change is not received, the notification sent to the following address shall be deemed to have been served after the time specified<br>in the following paragraph: |
| --- | --- |
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Party A:
Address: 20th Floor, No. 333, Caoxi North Road, Xuhui District, Shanghai
Attn: Yunjian Zhang
Phone: 62705198
Party B: Zhejiang Yitang Medical Service Co., Ltd.
Address: Room 1306, 13th Floor, Building 1, Jiangning Building, No. 27, Ningtai Road, Ningwei Street, Xiaoshan District, Hangzhou City, Zhejiang Province
Attn: Dehong Zhang
Phone:18668483733
（signature page follows）
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This page is only for signatures.
It is certified that this agreement has been signed by the parties on the date stated at the beginning of the Agreement.
Party A 1 (seal): China Capital Investment (Group) Co., Ltd.
Legal representative/authorized representative
Party A 2 (seal): Shanghai CCI Investment Co., Ltd
Legal representative/authorized representative:
Party A 3 (seal): Shanghai Hengshi Investment Management Co., Ltd.
Legal representative/authorized representative:
Party A 4 (seal): Xinjiang Huizhong Yifu Investment Co., Ltd.
Legal representative/authorized representative:
Party B (seal): Zhejiang Yitang Medical Service Co., Ltd.
Legal representative/authorized representative:
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Exhibit 99.1
Farmmi to Acquire Minority Ownership of ShanghaiJiaoda Onlly
for US$79.8 Million
— Accelerates Farmmi’s Diversificationinto the Medical and Health Industry —
**Lishui, China, November 5, 2021 –**Farmmi, Inc. (“Farmmi” or the “Company”) (NASDAQ: FAMI) announced that the Company has agreed to purchase approximately 16% of Shanghai Jiaoda Onlly Co., Ltd. (“Jiaoda Onlly”), a Shanghai Stock Exchange listed company under the ticker 600530.SH, from a major shareholder. Jiaoda Onlly operates elderly care institutions and engages in the research and development production and sale of health food. Farmmi, through its subsidiary Zhejiang Yitang Medical Service Co., Ltd. (“Yitang Medical”), purchase the shares of Jiaoda Onlly from China Capital Investment (Group) Co., Ltd. (CCIG) and related companies for approximately RMB 509 million (approximately US$79.8 million). Following the purchase, Yitang Medical will be the second largest shareholder of Jiaoda Onlly, marking Farmmi’s entrance into China’s medical and health industry.
Jiaoda Onlly (600530.SH) is one of the largest elderly care and rehabilitation institution listed in China, currently operating 14 nursing and rehabilitation institutions primarily located in Shanghai, Jiangsu and Zhejiang, with capacity of nearly 4,000 beds. With revenue reaching approximately RMB 333 million (approximately US$52.1 million) the fiscal year 2020, Jiaoda Onlly is committed to becoming the largest medical care enterprise in Asia. In addition, Jiaoda Onlly’s fast growing health food business has 31 health food approval numbers and 16 invention patents, covering a full range of products from dietary supplements and traditional tonics to functional products for heart protection, hypoglycemic conditions and more.
Farmmi Inc. (NASDAQ: FAMI) is the first Chinese edible fungus company listed on NASDAQ that specializes in the research, production, processing, and sales of edible fungi. The Company has more than 20 years of development history, on the basis of consolidating and developing the original edible fungus industry and investing in innovations for the constantly evolving field. Farmmi’s recently announced its expanded business strategy targeting the broader healthcare industry, with the formation of several new subsidiaries, including Farmmi (Hangzhou) Health Development Co., Ltd., Zhejiang Farmmi Health Medical Technology Co., Ltd., Zhejiang Yiting Medical Technology Co., Ltd. and Yitang. Farmmi plans to use Yitang to focus on growth opportunities in the medical and health fields, including rehabilitation hospitals and nursing homes. Zhejiang Yiting Medical Technology Co., Ltd. will focus on opportunities in the elderly care industry, including the acquisition, investment and operation of nursing homes.
Ms. Yefang Zhang, Farmmi’s Chairwoman and CEO, commented, “This is the largest investment in our 20-year history. In the process of conducting our due diligence, we have gotten to know the Jiaoda Onlly team and are excited about the business and its multi-year growth opportunities. As one of the largest elderly care and rehabilitation institution listed in China, Jiaoda Onlly will serve as the cornerstone of our recently announced expansion into the broader healthcare industry, our overall business diversification and our aggressive drive to increase operating cash flow and investor value. The healthcare industry is undergoing a period of dramatic growth led by the aging population and the increased need for full-time care, which was further amplified by the COVID-19 pandemic. With an increasing need for care and an even higher premium placed on quality of life facilitators, we expect both our investment in Jiaodo Onlly and our broader expansion will create significant value for Farmmi and our shareholders over the coming years.”
About Farmmi, Inc.
Farmmi Inc. (NASDAQ: FAMI) was established in 1998, formerly known as Zhejiang Forasen Food Co., Ltd., which is an agricultural e-commerce technology enterprise. Headquartered in Lishui, Zhejiang, is an agricultural products supplier, processor and retailer of Shiitake mushrooms, Mu Er mushrooms, other edible fungi and other agricultural products. For further information about the Company, please visit: http://ir.farmmi.com.cn/.
About Shanghai Jiaoda Onlly Co., Ltd.
Shanghai Jiaoda Onlly Co., Ltd. registered in Shanghai Administration for Industry and Commerce on December 24, 1997, it is a joint stock company established by nine promoters and shareholders on the basis of the original Shanghai Jiaotong University Onlly Biological Products Co., Ltd. Promoters includes Shanghai Jiaotong University, Shanghai Dazhong Taxi Co., Ltd., Shanghai Rongbei Industry and Trade Industrial Corporation, Shanghai Xinluda Commercial (Group) Co., Ltd., Shanghai International Co., Ltd., etc.
After more than 20 years of effort, the company has now become a leader in China's health food industry. In July 2001, the company was successfully listed on the Shanghai Stock Exchange (stock code: 600530), becoming the first listed company in China's health food industry.
Forward-Looking Statements
This press release contains forwarding-looking statement within information about Farmmi Inc.’s views on its future expectations, plans and prospects. We remind you not to rely too much on these forward-looking statements. Due to various of factors, actual results may differ materially from the anticipated results, including but not limited to its ability to raise additional funds, maintain and develop business, variability of business performance, ability to maintain and enhance its brand, development and launch of new products and services, completion of the Jiaoda Onlly purchase, successful integration of acquired companies, technologies and assets into its product and service portfolio, marketing and other business development initiatives, industry competition, general government regulation, economic conditions, the impact of the novel coronavirus pneumonia, dependence on key personnel, attracting, hiring and retaining personnel with the skills and experience required to meet customer requirements, and the ability to protect their intellectual property rights. Farmmi Inc. encourages you to review other factors that may affect its future results in its registration statement and other documents submitted to the U.S. Securities and Exchange Commission. The forward-looking statements in this press release are based on current expectations, our company does not undertake the obligation to update these forward-looking statements.
For more information, please contact Investor Relations:
Global IR Partners
David Pasquale
New York Office Phone: +1-914-337-8801
FAMI@Globalirpartners.com