SHANGHAI, May 20, 2024
/PRNewswire/ -- The9 Limited (Nasdaq: NCTY) ("The9"), an
established Internet company, today announced that it signed a
definitive share purchase agreement (the "Agreement") with Kuaijin
Shidai (Xiamen) Technology Co.,
Ltd. ("KuaiJin"), a company operating unmanned retail store
platform in China, to purchase 15%
of KuaiJin by cash and issuance of The9's restricted shares. The9
is also granted a purchase option to purchase up to 51% of the
total shares of KuaiJin. The purchase option is exercisable within
2 years and will be based on KuaiJin's valuation at US$60 million.
KuaiJin provides standardized cost-effective solution to retail
stores in China. Within 48 hours,
traditional retail stores can be transformed into AI unmanned
retail store by installation of KuaiJin hardware and software. The
AI unmanned retail stores can be opened 24 hours a day, 7 days a
week, under the monitor of AI-powered 360-degree surveillance
cameras. After such transformation, the payroll cost will be
significantly reduced. The chance of getting shoplifting will also
be reduced. Profit of the retail stores will be increased
accordingly. Due to this clear business model, KuaiJin has already
transformed more than 500 retail shops in more than 100 cities in
China.
Pursuant to the Agreement, The9 will pay cash consideration of
US$1.5 million and will issue
318,448,800 restricted Class A ordinary shares (equivalent to
1,061,496 ADSs) to KuaiJin. The restricted Class A ordinary
shares to be issued to KuaiJin will be subject to lock-up
conditions and will only be released according to the following
schedule: (i) when the market capitalization of The9 reaches
US$200 million, 20,940,900
Class A ordinary shares (equivalent to 69,803 ADSs) of The9
will be released from the lock-up; (ii) when the market
capitalization of The9 reaches US$500
million, 1,894,800 Class A ordinary shares (equivalent
to 27,921 ADSs) of The9 will be released from the lock-up, and
(iii) when the market capitalization of The9 reaches
US$1 billion, 4,188,300 Class A
Ordinary shares (equivalent to 13,961 ADSs) of The9 will be
released from the lock-up. The rest of the restricted shares shall
be released from the lock-up when either of the following
conditions are met: KuaiJin completes a qualified IPO and its
shares owned by The9 become freely tradable in the open market; or
if and when the The9 exercises its purchase option and, as a
result, holds a minimum 51% of the then total share capital of
KuaiJin.
"There are more than 5 million retail stores in China alone around the world. These small
retail stores are like capillaries, distributed in the streets and
alleys of cities, and together they form a huge offline real-time
retail network. They are indispensable business format in the daily
life of most people. However, millions of small retail store owners
and operators have long been faced with the problem of not having
the freedom to expand their businesses since they need to guard the
store. On the other hand, with the high popularity of mobile
payments in China nowadays, the
checkout actions in retail stores have become extremely standard
and simple. In this context, the low-cost intelligent
transformation solution provided by Kuaijin effectively solves the
storekeeping problem. It uses intelligent hardware and AI to
replace manual storekeeping. It can especially free up the
operators' time at night, so that the retail stores can be open 24
hours a day throughout the year without having to stay up late to
guard the store. More importantly, through AI-empowered
transformation, data on customers, products, locations and
financials will no longer be scattered and difficult to collect,
data can truly be capitalized. In the past, fast-moving consumer
product brands hired a large number of offline service personnel to
maintain customer sentiment in small retail stores to ensure
effective display and sales of products, which was costly and
inefficient. It is extremely difficult for brands to conduct data
analysis or implement marketing activities for millions of stores
with different operators. This is precisely the reason why the
channel value of small retail stores has been limited for a long
time. However, for the small retail stores cooperating with
Kuaijin, customers' entry, purchase, settlement, and departure are
all served through in-store hardware and AI. Customers' behaviors
are fully digitized without the need of changing the traditional
consumer shopping process. On this basis, Kuaijin can effectively
implement brand marketing plan such as promotion activities and new
product recommendations. The membership system, AI customer service
and video algorithms continuously collect and analyze huge amount
of data collected. We can then continuously train algorithms by
machine learning and fully embrace GenAI. With The9's investment,
Kuaijin can leverage The9's experience in different GenAI business
applications to help improving the GenAI capabilities of Kuaijin's
platform. Kuaijin is keen to expand service scenarios, improve
service experience, and create future AI retail stores recognized
by store owners and operators, consumers, and brands," said Mr.
JiaPao Wu, founder of KuaiJin.
As of the date hereof, the total number of issued and
outstanding shares of The9 is 1,993,729,927 (equivalent to
6,645,766 ADSs), being the sum of 1,980,122,593 Class A ordinary
shares and 13,607,334 Class B ordinary shares.
Safe Harbor Statement
This current report contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the
United States Private Securities Litigation Reform Act of 1995.
These forward-looking statements can be identified by terminology
such as "will," "expects," "anticipates," "future," "intends,"
"plans," "believes," "estimates" and similar statements. Such
statements are based upon management's current expectations and
current market and operating conditions and relate to events that
involve known or unknown risks, uncertainties and other factors,
all of which are difficult to predict and many of which are beyond
The9's control. The9 may also make written or oral forward-looking
statements in its periodic reports to the U.S. Securities and
Exchange Commission ("SEC"), in its annual report to shareholders,
in press releases and other written materials and in oral
statements made by its officers, directors or employees to third
parties. Statements that are not historical facts, including
statements about The9's beliefs and expectations, are
forward-looking statements. Forward-looking statements involve
inherent risks and uncertainties. A number of factors could cause
actual results to differ materially from those contained in any
forward-looking statement, including but not limited to the
following: The9's goal and strategies; The9's expansion plans;
The9's future business development, financial condition and results
of operations; The9's expectations regarding demand for, and market
acceptance of, its products and services; The9's expectations
regarding keeping and strengthening its relationships with business
partners it collaborates with; general economic and business
conditions; and assumptions underlying or related to any of the
foregoing. Further information regarding these and other risks is
included in The9's filings with the SEC. All information provided
in this current report is as of the date hereof, and The9 does not
undertake any obligation to update any forward-looking statement,
except as required under applicable law.
The9 Limited
17 Floor,
No. 130, Wu Song Road,
Hong Kou District,
Shanghai 200080, PRC
About The9 Limited
The9 Limited (The9) is an Internet company listed on Nasdaq in
2004. The9 aims to become a global diversified high-tech Internet
company, and is engaged in blockchain business including the
operation of cryptocurrency mining. The9 is also
stepping into AI application business in different industries.
Investor Relations
Contact
Ms. Rebecca
Cai
Investor Relations Specialist
The9 Limited
Tel: +86 (21) 6108-6080
Email: IR@corp.the9.com
Website: www.the9.com
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SOURCE The9 Limited