Aoxin Tianli To Sell OV Orange; Cancels Sale Of Hang-ao - Quick Facts

(RTTNews) - Aoxin Tianli Group, Inc. (ABAC), a company focused on hog farming in China, said it has executed an equity transfer agreement to sell its 95 percent equity interest in Wuhan Optical Valley Orange Technology Co., Ltd. or OV Orange to a group of third party investors.

Under the agreement, the company has agreed to transfer 95 percent of the equity interests in OV Orange for a total consideration of RMB47.5 million, or about $7.3 million.

To facilitate the transaction, the company will waive the earn-out provisions set forth in the stock purchase agreement executed in August 2014 and and release the 403,000 "earn-out" shares of the company's common stock currently held in escrow to Li-Na Deng at the end of March 2017. The company's board of directors voted in favor of the transaction on December 29, 2015.

Additionally, the company and Guangxi Hongzhen Investment Co., Ltd. have agreed to terminate the equity transfer agreement entered into by them on November 13, 2015, whereby Guangxi Hongzhen was to purchase the company's stake in Hubei Hang-ao Servo-valve Manufacturing Technology Co., Ltd.

The agreement was terminated at the request of Guangxi Hongzhen due to inability to obtain proper land use permits and deeds for Hang-ao's properties following the failure of the developer of the industrial park in which Hang-ao is located to complete the development of the industrial park and related permitting procedures. As a result, Hang-ao remains an 88 percent owned subsidiary of the company.