UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date
of Report (date of earlies event reported): June 2, 2021
AIXIN
LIFE INTERNATIONAL, INC.
(Exact
name of registrant as specified in its charter)
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Colorado
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0-17284
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84-1085935
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State
of
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Commission
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IRS
Employer
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Incorporation
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File
Number
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Identification
No.
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Hongxing
International Business Building 2, 14th FL, No. 69 Qingyun South Ave., Jinjiang District
Chengdu
City, Sichuan Province, China
(Address
of principal executive offices)
86-313-6732526
(Issuer’s
telephone number)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
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[ ]
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Written
communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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[ ]
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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[ ]
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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[ ]
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Indicate
by check mark whether the registrant is an emerging growth company 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 [X]
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. [ ]
Securities
registered pursuant to Section 12(b) of the Act:
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Title
of each class
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Trading
Symbol(s)
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Name
of each exchange on which registered
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Common
Stock
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AIXN
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OTCQX
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Cautionary
Note Regarding Forward-Looking Statements:
Any
statements contained in this Current Report on Form 8-K that are not historical facts are forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are generally identifiable by use of the words
“believes,” “expects,” “intends,” “anticipates,” “plans to,” “estimates,”
“projects,” or similar expressions. Such statements may include, but are not limited to, statements about the Registrant’s
planned acquisitions, the purchase price to be paid for such acquisitions and the future performance of the businesses to be acquired,
and other statements that are not historical facts. Such statements are based upon the beliefs and expectations of the Company’s
management as of this date only and are subject to risks and uncertainties that could cause actual results to differ materially. Therefore,
investors are cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation to revise
or publicly release the results of any revision to these forward-looking statements, whether as a result of new information, future events
or otherwise, other than as required by applicable law.
Item
1.01 Entry into a Material Definitive Agreement.
On
June 2, 2021, Aixin Life International, Inc. (“we”, “us” or the “Company”), entered into an Equity
Transfer Agreement (the “Transfer Agreement”) with Quanzhong Lin, the Chairman and President of our Company and the holder
of a majority of the shares of our outstanding common stock, Ting Li and Xiao Ling. Pursuant to the Transfer Agreement, we have agreed
to purchase Chengdu Aixin Pharmacy Co., Ltd. and certain affiliated entities, each of which operates a pharmacy. Consummation of the
acquisition is subject to the satisfaction or waiver of certain conditions, including the approval of the independent members of our
Board of Directors which was obtained at a meeting held on May 28, 2021.
Under
the terms of the Transfer Agreement, we have agreed to purchase all of the outstanding equity of nine entities (the “Pharmacy Cos”),
each of which is the owner and operator of a pharmacy located in Chengdu for an aggregate purchase price of RMB 34,635,845 or US$5,308,257
based on an exchange rate of RMB/ US$ 6.5249 yuan per dollar on December 31, 2020. The purchase price will be reduced by an amount equal
to any amounts paid or distributed by any of the Pharmacy Cos to Mr. Lin or Ting Li and Xiao Ling after December 31, 2020 and increased
by an amount equal to any monies they contributed to any of the Pharmacy Cos after such date. Mr. Lin owns in excess of 95% of the outstanding
equity the Pharmacy Cos. The balance is owned by Ting Li and Xiao Ling.
The
names of the Pharmacy Cos to be acquired and the location of each pharmacy are follows:
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Pharmacy
Name
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Address
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Chengdu
Aixintang Pharmacy Co., Ltd. Jianyang Branch
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Room
4, 1/F, Building 3, (Haishang Huayuan), No. 17 Gongyuanhou Street, Jiancheng Town, Jianyang City
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Chengdu
Aixintang Pharmacy Co., Ltd. Mianyang Branch
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No.
68 East Section of Linyuan Road, Fucheng District, Mianyang City
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Chengdu
Aixintang Liucheng Pharmacy Co., Ltd.
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No.
99 East Section of Liucheng Avenue, Wenjiang District, Chengdu City
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Chengdu
Aixintang Pharmacy Co., Ltd. Xinjin Branch
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No.
F1-4, No. 69 Zhengdong Street, Wujin Town, Xinjin County
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Chengdu
Aixintang Pharmacy Co., Ltd.
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No.
9, 1/F, Building 5, Hongxing International, No. 9 Qingyun West Street, Jinjiang District, Chengdu City
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Qionglai
Weide Pharmacy
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No.
40 Yudai Street, Linqiong Town, Qionglai City
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Chengdu
Wenjiang Aixinhui Pharmacy Co., Ltd.
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No.
301 Linquan North Street, Wenjiang District, Chengdu City
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Chengdu
Beibang Pharmacy Co., Ltd.
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No.
F55, No. 6 Xingyuan 3rd Road, Wujin Town, Xinjin County, Chengdu City
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Chengdu
Xindu District Cundetang Pharmacy Co., Ltd.
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No.
F54, No. 99 Pihe East Road, Xindu Street, Xindu District, Chengdu City
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The
first of the nine pharmacies was established in 2016. Each of the pharmacies engages in the retail sale of pharmaceuticals;
sales of pre-packaged food and bulk food, health food, dairy products, cosmetics, electronic products, disinfecting supplies, class-I,
and class-II medical equipment and the staff at each pharmacy consults with customers regarding common nutrition and health issues, though
they are not licensed to make a diagnosis and when appropriate refer customers to a physician.
We
received an appraisal from Zhengyuanzin Real Estate Land and Assets Appraisal Co., Ltd. which valued the Pharmacy Cos as of the end of
November 30, 2020, at an aggregate amount equal to the purchase price. In reaching a purchase price for
the pharmacies, the parties focused on the annual revenues of each pharmacy which is the metric used for private transfers of pharmacies
in China. For the twelve months ended November 30, 2020, the aggregate annual operating revenues of the nine pharmacies were RMB 8,328,992.
Due to the impact of Covid-19, this included revenues of RMB 5,154,039.60 from the sales of masks. The parties agreed these were extraordinary
revenues and the purchase price was based upon normalized annual revenues of RMB 3,463,584 to determine the purchase price of RMB 34,635,845.
The
Transfer Agreement contains customary representations, warranties, and covenants of the parties and post-closing indemnities. The representations
and warranties set forth in the Agreement generally survive for 18 months following the closing.
The
Company expects the closing of the acquisition to occur no later than July 1, 2021.
A
copy of the Transfer Agreement is attached as an exhibit to this report on Form 8-K. The foregoing description of the Transfer Agreement
does not purport to be complete and is qualified in its entirety by reference to the Transfer Agreement.
Item
9.01 Financial Statements and Exhibits.
(a)
Financial statements of business acquired.
The
financial statements required by Rule 8-04 of Regulation S-X will be filed by amendment to this Current Report on Form 8-K as soon as
practicable, but in no event later than 71 calendar days after the date on which this Current Report on Form 8-K was required to be filed.
(b)
Pro forma financial information
The
pro forma financial information required pursuant to Rule 8-05 and Article 11 of Regulation S-X will be filed by amendment to this Current
Report on Form 8-K as soon as practicable, but in no event later than 71 calendar days after the date on which this Current Report on
Form 8-K was required to be filed.
SIGNATURES
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.
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AiXin
Life International, Inc.
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Date:
June 3, 2021
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By:
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/s/
Quanzhong Lin
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Quanzhong
Lin
Chief
Executive Officer
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Exhibit
10.1
Equity
Transfer Agreement
Transferor
(Party A):
Lin
Quanzhong
ID
Card No.: 413022197810170415
Contact
No.: 13730829210
Ting
Li
ID
Card No.: 511324198710301081
Contact
No.: 13541289929
Xiao
Ling Li
ID
Card No.: 511023197106020163
Contact
No.: 17396269535
Transferee
(Party B):
HK
Aixin International Group Co., Limited
Company
No.: 2342435
WHEREAS:
1.
Nine pharmacies including Chengdu Aixintang Pharmacy Co., Ltd. (as detailed in the Appendix) are limited liability companies and branches
(hereinafter collectively referred to as the “Company”) that are legally registered and validly existing in Chengdu, Mianyang
and other cities of Sichuan Province, and the business scope covers pharmaceutical retail; sales of pre-packaged food and bulk food,
health food, dairy products, daily necessities, cosmetics, electronic products, disinfection supplies, class-I, and class-II medical
equipment; nutrition and health consultation (excluding treatment and diagnosis). Legal representative: Lin Quanzhong.
The
total registered capital of the nine pharmacies in question is RMB 21.25 million.
2.
The Equity Transfer Agreement is hereby made and concluded by and between the Transferor and the Transferee on the basis of equality,
voluntariness, mutual benefit and reciprocity upon amicable consultation. The Parties hereto agree that Party A shall transfer 100% of
their equity of the nine pharmacies including Chengdu Aixintang Pharmacy Co., Ltd. to Party B. Each of the Transferors owns the percentage
of the equity of the nine pahramacies as indicated on the Appendix.
Article
I Transfer of Equity
1.1
Subject matter
Party
A shall transfer 100% of the equity that they own in the Company to Party B and Party B agrees to accept such equity in question.
1.2
Transfer price, payment method and payment teen:
Based
on the asset appraisal report CZYXZPB (2021) No. G01-01 issued by Sichuan Zhengyuanxin Real Estate, Land and Assets Appraisal Co., Ltd.
on January 12, 2021, the appraised value of such nine phairnacies including Chengdu Aixintang Pharmacy Co., Ltd. as are owned by Party
A is RMB 34,635,845.45, and Party A and Party B agree with the transfer at RMB 34,635,845.45 (in words RMB thirty four million six hundred
and thirty five thousand eight hundred and forty five yuan forty five cents)subject to adjustment as provided in this Agreement. The
RMB 34,635,845.45 is referred to as the “Transfer Price.”
Party
A and Party B agree that the aforesaid transfer price shall be converted into USD 5,308,256.90 (in words USD five million three hundred
and eight thousand two hundred and fifty six yuan and ninety cents) pursuant to the intermediate exchange rate of RMB against USD at
6.5249 yuan per dollar on December 31, 2020.
The
Transfer Price shall be reduced by an amount equal to any amounts paid or distributed by the Company to Party A after December 31, 2020
and will be increased by an amount equal to any amounts contributed to the Company to Party A after December 31, 2020. The Transfer Price,
as adjusted in accordance with thuis provision is referred to as trhe “Adjusted Transfer Price.”
Payment
method: in currency
Payment
term: Party B shall pay the transfer price in full to Party A within three working days upon the completion of the registration of industrial
and commercial change of equity. Party A shall issue a bill to Party B within five working days upon receipt of the payment in full made
by Party B and deliver the bill in question to Party B.
1.3
Party B shall be a shareholder after the Agreement comes into force and Party B pays the consideration for the transfer of equity as
agreed herein.
1.4
After the Agreement comes into force upon signature by Party B as agreed herein, Party B shall immediately go through the registration
formalities related to the alteration of shareholders and equity and modifications to Articles of Association of the Company in accordance
with the law. Party A shall actively assist or cooperate with Party B and Party B shall bear the expenses incurred in such alteration
registration.
Article
II Undertakings and Warranties of Party A
2.1
The equity transferred by Party A to Party B is the Company’s real investment and is legally owned by Party A, and Party A has
the full right to dispose of the equity in question.
2.2
Party A has obtained full authorization from shareholders of the Company to make warranties and guarantees set forth herein.
2.3
Prior to the date of equity transfer, Party A has not entered into any form of legal documents with any third party, or conducted any
disposal to the subject matter hereof in any form by any other legally permitted means, including but not limited to transfer, pledge,
entrusted management, or assignment of the rights attached to the subject matter hereof in full or in part. Otherwise, Party A shall
indemnify and hold harmless the Company from and against any loss or damage resulting from such false guarantee after equity transfer.
2.4
Prior to the date of equity transfer, the Company has, in accordance with the national tax policies and rules and regulations, according
to the fact, apply for and issue an invoice, make a tax declaration on time and pay the tax payable in full, and has never violated the
tax policies and rules and regulations such as making false invoices or buying and selling invoices. Otherwise, Party A shall indemnify
and hold harmless the Company from and against any loss or damage resulting from such false guarantee after equity transfer.
2.5
Prior to the date of equity transfer, the Company has no litigation that has occurred but has not been sentenced, no pending litigation
that has been sentenced but has not been executed or is being executed, no potential litigation that is about to occur, and no tax penalties
(including national tax and local tax) or no tax (including national tax, local tax) penalty or tax arrears that have not been settled.
Otherwise, Party A shall indemnify and hold harmless the Company from and against any loss or damage resulting from such false guarantee
after equity transfer.
2.6
Prior to the date of equity transfer, all the checks, bank acceptance bills and commercial acceptance bills issued by the Company have
been honored. After the date of equity transfer, the Company will not receive the checks, bank acceptance bills or commercial acceptance
bills issued prior to the date of equity transfer required to be honored. Otherwise, Party A shall indemnify and hold harmless the Company
from and against any loss or damage resulting from such false guarantee after equity transfer.
2.7
Prior to the date of equity transfer, the Company has settled the labor remuneration (salary) and social insurance relationship with
all employees. After the date of equity transfer, the Company will not be subject to labor disputes, remuneration disputes and social
insurance penalties from former employees. Otherwise, Party A shall indemnify and hold harmless the Company from and against any loss
or damage resulting from such false guarantee after equity transfer.
Article
III Undertakings and Warranties of Party B
3.1
Party B is eligible for the subject matter of the assignment agreement stipulated by law before the registration of equity change, and
the normal conduct of legal proceedings for equity transfer will not be affected by the constraints of Party B’s own conditions.
3.2
Party B has sufficient financial capacity to acquire the subject matter hereof and undertakes to pay the equity transfer price in time
as agreed herein.
3.3
Party B shall by no means conduct business activities or sign any contract by using any certificate of the Company during the period
from the effective date hereof to the date of equity transfer. Otherwise, Party B shall indemnify and hold harmless the Company from
and against any loss or damage resulting from such false guarantee.
3.4
Party B shall by no means use any and all certificates and documents (including but not limited to the Business License, Tax Registration
Certificate, Organization Code Certificate and Card of Code, Credit Card, Account Opening Permit, etc.), seals and original company documents
(including but not limited to the Company’s Articles of Association, lease contract, capital verification report and audit reports,
accounting books, accounting vouchers, tax returns, blank checks, blank invoices of the previous years, etc.) obtained from Party A for
any activity other than the matter of Company change. Otherwise, Party B shall indemnify and hold harmless the Company from and against
any loss or damage resulting from such false guarantee.
Article
IV Rights and Obligations of the Parties
4.1
As from the effective date hereof, Party A no longer retains100% ownership of the equity and no longer enjoys any rights or assumes any
obligations to partial equity. Party B shall, in accordance with the provisions of relevant laws and the Articles of Association, enjoy
the rights and assume the corresponding obligations in proportion to the assigned equity.
4.2
Within three days upon the execution date hereof, Party A shall be responsible for the convening the meetings of shareholders and the
Board of Directors, ensure that the shareholders’ meeting approves the equity transfer, and sign relevant agreements or draft amendments
with respect to the amendment to the Articles of Association of the Company.
4.3
Within three days upon the execution date hereof, Party A and Party B shall jointly complete the reorganization of the meetings of shareholders
and the Board of Directors, and finalize all legal documents relating to the transfer of equity.
4.4
Within 15 days upon the completion of all legal documents for the equity transfer in accordance with Article 4.3 hereof, Party A shall
assist Party B to register the change with the relevant authorities in accordance with Chinese laws and regulations.
Article
V Division of Creditor’s Rights and Debts before Change of the Company
5.1
The actual or potential creditor’s rights and debts of the Company prior to the date of equity transfer shall be owned and undertaken
by Party A. After the transfer, Party A shall independently assume the liability for litigations or losses of the Company caused by the
actual or potential debts prior to the date of equity transfer.
5.2
The creditor’s rights and debts incurred after the date of equity transfer shall be enjoyed and assumed by all shareholders of
the Company after the change.
Article
VI Allocation of Profits and Losses
Party
B shall get the benefit of all profits and absorb the losses generated after December 31, 2020.
Article
VII Undertaking of Equity Transfer Fees and Procedures for Equity Transfer
The
costs and expenses incurred in the equity transfer shall be borne by the Company after such change, and the taxes incurred in the equity
transfer shall be borne by Party A.
Article
VIII Modification and Termination of the Agreement
The
Agreement may be modified or terminated in the course of equity transfer under the following circumstances, provided that a written agreement
regarding such modification or termination has been signed by the Parties:
8.1
The Agreement cannot be performed due to force majeure or any external factor which cannot be prevented by either Party and is not the
fault of either Party.
8.2
Either Party loses the demonstrated capability to perform the Agreement.
8.3
The breach by a Party materially affects the economic interests of the other Party and causes the performance of the Agreement unnecessary.
8.4.
The modification or termination of the Agreement is agreed upon by the Parties due to change of circumstance.
Article
IX Liability for Breach of the Agreement
9.1
In the event that Party A fails to perform the relevant obligations of equity transfer, Party A shall pay 20% of the equity transfer
price to Party B as compensation, and Party B may unilaterally terminate the Agreement.
9.2
In the event that Party B fails to make the payment within the prescribed time, Party B shall pay 3%0 of the equity transfer price to
Party A as liquidated damages for each day of delay, and Party A may unilaterally terminate the Agreement.
Article
X Dispute Resolution
Any
dispute arising out of or in connection with the Agreement shall be resolved by the Parties hereto through consultation first. If no
agreement can be reached through such consultation, the dispute shall be submitted to the competent people’s court at the place
where Party A is located.
Article
XI Entry-into-force Conditions and Date
The
Agreement shall come into force upon signature (or corporate seal) by the Parties. Article XII Miscellaneous
The
Agreement is made out in two originals, with each Party holding one copy and each copy being equally authentic.
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Party
A:
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Party
B:
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Aixin
Life International, Inc.
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/s/
Quanzhong Lin
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By:
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/s/
Yao- Te Wang
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Quanzhong
Lin
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Yao-Te
Wang
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An
Authorized Person
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/s/
Ting Li
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Ting
Li
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/s/
Xiao Ling Li
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Date:
June 2, 2021
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Date:
June 2, 2021
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Appendixes:
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Pharmacy
Name
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Address
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Taxpayer
Identification
Number
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Date
of
Incorporation
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Chengdu
Aixintang Pharmacy
Co., Ltd. Jianyang Branch
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Room
4, 1/F, Building 3,
(Haishang Huayuan), No. 17
Gongyuanhou Street, Jiancheng
Town, Jianyang City
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91512081MA62K4JBOB
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2016-7-27
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Chengdu
Aixintang Pharmacy
Co., Ltd. Mianyang Branch
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No.
68 East Section of Linyuan
Road, Fucheng District,
Mianyang City
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91510703MA6249H20Q
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2016-5-20
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Chengdu
Aixintang Liucheng
Pharmacy Co., Ltd.
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No.
99 East Section of
Liucheng Avenue, Wenjiang
District, Chengdu City
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91510115MA61W48481
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2016-6-7
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Chengdu
Aixintang Pharmacy
Co., Ltd. Xinjin Branch
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No.
F1-4, No. 69 Zhengdong
Street, Wujin Town, Xinjin
County
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91510132MA61UXX022
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2016-5-26
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Chengdu
Aixintang Pharmacy
Co., Ltd.
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No.
9, 1/F, Building 5, Hongxing International, No. 9 Qingyun West Street, Jinjiang
District,
Chengdu City
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91510104MA61TNCJ15
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2016-3-4
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Qionglai
Weide Pharmacy
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No.
40 Yudai Street, Linqiong
Town, Qionglai City
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925101831544539720
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2018-3-8
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Chengdu
Wenjiang Aixinhui
Pharmacy Co., Ltd.
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No.
301 Linquan North Street,
Wenjiang District, Chengdu
City
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92510115MA6DBTK815
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2019-2-27
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Chengdu
Beibang Pharmacy
Co., Ltd.
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No.
F55, No. 6 Xingyuan 3rd
Road, Wujin Town, Xinjin
County, Chengdu City
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91510132MA6A1FJC2Q
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2019-3-12
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Chengdu
Xindu District Cundetang Pharmacy Co., Ltd.
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No.
F54, No. 99 Pihe East
Road, Xindu Street, Xindu
District, Chengdu City
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91510114L711644191
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2018-7-13
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Store
Name
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Percentage
of Equity
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Chengdu
Aixintang Pharmacy Co., Ltd., Jiangyang Branch
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Quanzhong
Lin 100%
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Chengdu
Aixintang Pharmacy Co., Ltd., Mianyang Branch
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Quanzhong
Lin 100%
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Chengdu
Aixintang LiuCheng Pharmacy Co., Ltd.,
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Quanzhong
Lin 95%
Ting
Li 5%
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Chengdu
Aixintang Pharmacy Co., Ltd., Xinjin Branch
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Quanzhong
Lin 100%
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Chengdu
Aixintang Pharmacy Co., Ltd.
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Quanzhong
Lin 95%
Ting
Li 5%
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Qiaonglai
Weide Pharmacy
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Quanzhong
Lin 100%
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Chengdu
Wenjiang aixinhui Pharmacy Co., Ltd.
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Quanzhong
Lin 80%
Xiao
Ling Li 20%
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Chengdu
Beibang Pharmacy Co., Ltd.
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Quanzhong
Lin 97.5%
Ting
Li 2.5%
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Chengdu
Xindu cundetang Pharmacy Co., Ltd.
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Quanzhong
Lin 90%
Xiao
Ling Li 10%
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