SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Date of report (date of earliest event reported): July 5, 2018 (July 3, 2018)
(Exact name of registrant as specified in its charter)
(State or Other
|(Commission File Number)||
Room 1001, Building T5,
DaZu Square, Daxing District,
Beijing, People’s Republic of China
(Address of principal executive offices)
Registrant’s telephone number, including area code: (+86) 10-87227366
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:
|☐||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))|
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company þ
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Section 1 – Registrant’s Business and Operations
|ITEM 1.02.||Termination of a Material Definitive Agreement|
On July 3, 2018, Shineco, Inc., a Delaware corporation (the “ Company ”) and IFG Opportunity Fund LLC, a Georgia limited liability company (“ Stockholder ”) entered into a termination agreement, dated July 3, 2018 (the “ Termination Agreement ”) effective as of July 3, 2018, to terminate the following two agreements, the Purchase Agreement (defined below) and the Registration Rights Agreement (defined below). The Company and the Stockholder, on January 23, 2018, entered into a certain common stock purchase agreement for the option of the Company to direct Stockholder to purchase up to a total of $15,000,000 of shares (the “ Equity Line ”) of the Company’s common stock (the “ Purchase Agreement ”). The Company and the Stockholder, on January 23, 2018, entered into a Registration Rights Agreement for certain registration rights in connection with the Purchase Agreement (the “ Registration Rights Agreement ”). Pursuant to the Purchase Agreement, the Company issued to the Stockholder an additional 200,000 shares of the Company’s common stock (the “ Commitment Shares ”) as consideration for the Stockholder to enter into the Purchase Agreement.
On November 21, 2017, the Company had filed with the SEC a registration statement on Form S-3 (File No. 333-221711) which was declared effective on December 19, 2017 (the “ Shelf Registration Statement ”). The Shelf Registration Statement utilizes a shelf registration process under which the Company may, from time to time, sell up to $25,000,000 in the aggregate of common stock and other types of securities as specified in the Shelf Registration Statement. The Company had filed a prospectus supplement to the Shelf Registration Statement on January 26, 2018 to cover the resale of the Commitment Shares and the securities to be sold pursuant to the Equity Line by and on behalf of the Stockholder.
As of the date of this current report, no shares pursuant to the Equity Line have been issued to the Stockholder by the Company (except for the Commitment Shares). As such, as of the date of this current report, except for the Commitment Shares, no other securities of the Company have been issued pursuant to the Shelf Registration Statement and prospectus supplement.
The Termination Agreement provides that all rights, duties, obligations, or liabilities arising thereunder or relating thereto the Purchase Agreement and the Registration Rights Agreement are terminated.
Attached as Exhibit 99.1 is the Termination Agreement, which is incorporated into this Item 1.02 by reference.
Section 9 – Financial Statements and Exhibits
|ITEM 9.01||FINANCIAL STATEMENTS AND EXHIBITS|
|99.1||Termination Agreement, dated as of July 3, 2018, between Shineco, Inc. and IFG Opportunity Fund LLC.|
Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|By:||/s/ Yuying Zhang|
|Its:||Chief Executive Officer|
Dated: July 5, 2018
This TERMINATION AGREEMENT (the “ Termination Agreement ”) is made and entered into as of the July 3, 2018 (the “ Effective Date ”), by and between Shineco, INC., a Delaware corporation (the “Company”), and IFG OPPORTUNITY FUND LLC, a Georgia limited liability company (“ Stockholder ”).
WHEREAS, the Company and Stockholder previously entered into that certain COMMON STOCK PURCHASE AGREEMENT dated as of January 23, 2018 and attached hereto as Exhibit A (the “ Purchase Agreement ”), pursuant to which the Company has the right, from time to time in its sole discretion during the 24-month term of the Purchase Agreement, to direct Stockholder to purchase up to a total of $15,000,000 (the “ Available Amount ”) of shares of the Company’s common stock (the “ Shares ”), subject to the terms and conditions thereof. The Shares were being offered in an indirect primary offering consisting of an equity line of credit (the “ Offering ”), in accordance with the terms and conditions of the Purchase Agreement.
WHEREAS, the Company and Stockholder previously entered into that certain REGISTRATION RIGHTS AGREEMENT dated as of January 23, 2018 and attached hereto as Exhibit B (the “ Rights Agreement ”), pursuant to which the Company agreed to prepare and file under the Securities Act and under its current registration statement on Form S-3 (File No. 333-221711), if needed, one or more registration statements, as permissible and necessary, for the sale or potential sale of the shares of the Company’s common stock that have been and may be issued to IFG Fund under the Purchase Agreement.
WHEREAS, the Company and Stockholder desire to terminate the Purchase Agreement and the Rights Agreement (together, the “ Stockholder Agreements ”), effective immediately, and any and all of Stockholder’s rights arising thereunder the Stockholder Agreements;
WHEREAS, the Board of Directors of the Company has approved the terms of this Termination Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the sufficiency of which are hereby acknowledged, the parties to this Termination Agreement mutually agree as follows:
1. TERMINATION OF STOCKHOLDER AGREEMENTS
1.1 Termination of the Purchase Agreement . Any and all contracts, agreements, arrangements, and understanding arising under the Purchase Agreement are hereby terminated, effective within one business day of the Effective Date, and of no further force or effect, and no rights, duties, obligations, or liabilities arising thereunder. The Company and Stockholder acknowledge and agree that as of the Effective Date, there are no pending purchases and the Company and the Stockholder do not have any respective obligations with respect to any pending purchases under the Purchase Agreement.
1.2 Termination of the Rights Agreement. Any and all contracts, agreements, arrangements, and understanding arising under the Rights Agreement are hereby terminated, effective as of the Effective Date, and of no further force or effect, and no rights, duties, obligations, or liabilities arising thereunder or relating thereto shall survive this termination.
1.3 Release . Stockholder, for Stockholder and Stockholder’s successors and assigns forever, does hereby unconditionally and irrevocably compromise, settle, remise, acquit and fully and forever release and discharge the Company and its successors, assigns, affiliates, members, officers, employees and agents (collectively, the “ Released Parties ”) from any and all claims, counterclaims, set-offs, debts, demands, choses in action, obligations, remedies, suits, damages and liabilities in connection with any rights arising under or in connection with the Shares, whether now known or unknown or suspected or claimed, whether arising under common law, in equity or under statute, which Stockholder or Stockholder’s successors or assigns ever had, now have, or in the future may claim to have against the Released Parties and which may have arisen at any time on or prior to the date hereof.
1.4 Further Assurances . Each party to this Termination Agreement agrees that it will perform all such further acts and execute and deliver all such further documents as may be reasonably required in connection with the consummation of the transactions contemplated hereby in accordance with the terms of this Termination Agreement.
2.1 Captions . The captions used in this Termination Agreement are for reference purposes only, and shall not in any way affect the meaning or interpretation of this Termination Agreement.
2.2 Parties in Interest . This Termination Agreement shall be binding upon and shall inure to the benefit of the parties to this Termination Agreement and their respective heirs, executors, administrators, successors and assigns.
2.3 Acknowledgements . Stockholder acknowledges that Stockholder has been advised by the Company to consult with Stockholder’s tax advisor to determine the tax consequences with respect to Stockholder of the actions and agreements provided herein, and that the Company shall not be responsible for any taxes owed by Stockholder arising from the actions and agreements provided herein.
2.4 Execution . This Termination Agreement may be executed in two or more counterparts, all of which taken together shall constitute one instrument. The exchange of copies of this Termination Agreement and of signature pages by facsimile transmission shall constitute effective execution and delivery of this Termination Agreement as to the parties and may be used in lieu of the original Termination Agreement for all purposes. Signatures of the parties transmitted by facsimile shall be deemed to be their original signatures for any purpose whatsoever.
2.5 Entire Agreement . This Termination Agreement contains the entire understanding of the parties to this Termination Agreement with respect to the subject matter contained herein. This Termination Agreement supersedes all prior agreements and understandings among the parties with respect to such subject matter.
2.6 Governing Law . This Termination Agreement shall be governed and construed in accordance with the substantive laws of the State of New York, without regard to its principles of conflict of laws.
2.7 Jurisdiction and Venue . Any judicial proceedings brought by or against any party on any dispute arising out of this Termination Agreement or any matter related thereto shall be brought in the state or federal courts of New York, and, by execution and delivery of this Termination Agreement, each of the parties accepts for itself the exclusive jurisdiction and venue of the aforesaid courts as trial courts, and irrevocably agrees to be bound by any judgment rendered thereby in connection with this Termination Agreement after exhaustion of all appeals taken (or by the appropriate appellate court if such appellate court renders judgment).
[Signature page follows]
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IN WITNESS WHEREOF, the Stockholder and the Company have caused this Termination Agreement to be duly executed as of the date first written above.
|THE COMPANY :|
|By:||/s/ Yuying Zhang|
|Title:||Chief Executive Officer|
|IFG OPPORTUNITY FUND LLC|
|By:||/s/ Anthony Gentile|
COMMON STOCK PURCHASE AGREEMENT
REGISTRATION RIGHTS AGREEMENT