BOQI International Medical Announces Closing of Previously Announced Sale of Senior Secured Convertible Notes and Warrants

Rhea-AI Summary

BOQI International Medical Inc. (NASDAQ: BIMI) announced the closing of a $4.45 million sale of senior secured convertible notes. These notes, with a 19.85% original issue discount, rank senior to other debts and may be convertible into shares after stockholder approval expected by late July. The conversion price is set at $2.59 with a 22% discount to the lowest volume weighted average price in the preceding 10 trading days. The investment aims to strengthen the company's financial position and support its transformation into a healthcare products provider.

Positive

• Closing of $4.45 million in senior secured convertible notes strengthens financial position.
• Potential issuance of additional convertible notes up to $2.1 million indicates investor confidence and future funding options.

Negative

• Convertible notes issued at a significant discount (19.85%), impacting perceived value.
• Conversion price tied to a 22% discount may dilute existing shareholders.

New York, June 04, 2020 (GLOBE NEWSWIRE) -- BOQI International Medical Inc. (NASDAQ: BIMI) (“BIMI” or the “Company”) today announced the closing of its previously announced sale of $4.45 million of a new series of senior secured convertible notes (the “Convertible Notes”) with an original issue discount of 19.85% and ranking senior to all outstanding and future indebtedness of the Company in a private placement to two institutional investors. Additional Convertible Notes in an aggregate original principal amount not to exceed $2,100,000 may also be issued to the institutional investors at a later date under certain circumstances. The Convertible Notes do not bear interest except upon the occurrence of an event of default.

The Convertible Notes are convertible into shares of the Company’s common stock at any time or times after the stockholder approval of the transaction is obtained, which is expected to take place at the end of July. The conversion price of the Convertible Notes is $2.59 less a 22% discount to the lowest volume weighted average price of the common stock of the Company in the prior 10 trading days before conversion, subject to a floor of $0.554 per share.

At the closing of the transaction on June 2, 2020, each institutional investor paid $1,750,000 in cash for a Convertible Note with a face amount of $2,225,000 and received a warrant to purchase 650,000 shares of common stock at an initial exercise price of $2.845. The placement agent for the Private Placement, FT Global Capital Inc., also received a warrant to purchase up to 171,845 shares of common stock at an initial exercise price of $2.845 per share, subject to increase based on the number of shares of common stock issued pursuant to the Convertible Notes.

"We are excited to have the two investors as valued partners as they share our confidence in the long-term growth of our company," said Mr. Tiewei Song, Chief Executive Officer and President of BOQI International Medical Inc. "This investment helps strengthen our financial position and provides the company with the resources to grow its business. As a consumer-centric and market-oriented company, we are more than ever committed to engaging our customers with a higher-quality, simpler and more affordable healthcare experience."

About BOQI International Medical Inc.

BOQI International Medical Inc. (formerly known as NF Energy Saving Corporation) (NASDAQ: BIMI) was founded in 2006. In February 2019, the Board of Directors of the company was reorganized following efforts led by Mr. Yongquan Bi, the company’s new Chairman, with a renewed focus on the health industry. The company is now transforming from a provider of integrated energy conservation solutions to a healthcare products provider. BOQI International Medical Inc. offers a broad range of healthcare products and related services.

Safe Harbor Statement

The statements contained herein that are not historical facts are considered “forward-looking statements.” Such forward-looking statements may be identified by, among other things, the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” or “anticipates” or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy that involve risks and uncertainties. In particular, statements regarding the efficacy of investment in research and development are examples of such forward-looking statements. The forward-looking statements include risks and uncertainties, including, but not limited to, the effect of political, economic, and market conditions and geopolitical events; the impact of COVID-19;  legislative and regulatory changes that affect our business; the availability of funds and working capital; the actions and initiatives of current and potential competitors; investor sentiment; and our reputation. We do not undertake any responsibility to publicly release any revisions to these forward-looking statements to take into account events or circumstances that occur after the date of this report. Additionally, we do not undertake any responsibility to update you on the occurrence of any unanticipated events, which may cause actual results to differ from those expressed or implied by any forward-looking statements. The factors discussed herein are expressed from time to time in our filings with the Securities and Exchange Commission available at http://www.sec.gov. 

IR Contact:
Dragon Gate Investment Partners LLC
Tel: +1(646)-801-2803
Email: BIMI@dgipl.com

FAQ

What is the amount raised by BOQI International Medical Inc. through convertible notes?

BOQI International Medical Inc. raised $4.45 million through a sale of convertible notes.

When is the stockholder approval for the conversion of notes expected?

Stockholder approval for the conversion of notes is expected by the end of July.

What is the conversion price of the convertible notes issued by BIMI?

The conversion price of the convertible notes is set at $2.59, with a 22% discount to the lowest volume weighted average price.

What are the potential future financing options for BOQI International Medical Inc.?

BOQI may issue additional convertible notes up to $2.1 million under certain conditions.

What are the implications of the convertible notes for existing shareholders of BIMI?

The issuance of convertible notes at a significant discount and the conversion terms may lead to dilution of existing shareholders' equity.