UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

SCHEDULE 14A

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934

 

Check the appropriate box:

Zhongpin Inc.

(Name of the Registrant as Specified in its Charter)

Payment of Filing Fee (Check the appropriate box):

Zhongpin Inc. common stock, par value 0.001 (“ common stock ”)

37,209,344 shares of common stock less 9,687,505 shares of common stock held by the Rollover Investors (as defined in the Proxy Statement) and 787,000 shares of common stock issuable pursuant to the Company stock options.

The proposed maximum aggregate value of the transaction for purposes of calculating the filing is $372,158,686.50. The maximum aggregate value of the transaction was calculated based upon the sum of (A)(1) 27,521,839 shares of common stock issued and outstanding and owned by persons other than the Company and the Rollover Investors (as defined in the Proxy Statement) on March 15, 2013, multiplied (2) by $13.50 per share (the “ per share merger consideration ”) and (B)(1) 787,000 shares of common stock issuable pursuant to the Company stock options, as of March 15, 2013, multiplied by (2) the excess of the per share merger consideration over the weighted average exercise price of $12.72. The filing fee equals the product of 0.00013640 multiplied by the maximum aggregate value of the transaction.

$372,158,686.50

$50,762.44

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ZHONGPIN INC.

May 28, 2013

To the Stockholders of Zhongpin Inc.:

You are cordially invited to attend a special meeting of stockholders of Zhongpin Inc., a Delaware corporation (the “ Company ,” “ we ,” “ us ” or “ our ”) to be held at 10:00 a.m., local time, on Thursday, June 27, 2013, at 21 Changshe Road, Changge City, Henan Province, People’s Republic of China 461500.

On February 8, 2013, we entered into an Amended and Restated Agreement and Plan of Merger (the “ merger agreement ”) with Golden Bridge Holdings Limited, a Cayman Islands exempted company (“ Parent ”), Golden Bridge Merger Sub Limited, a Delaware corporation and a wholly owned subsidiary of Parent (“ Merger Sub ”) and Mr. Xianfu Zhu, our Chairman and Chief Executive Officer (solely for the purposes of Section 6.15), providing for the merger of Merger Sub with and into the Company (the “ merger ”), with the Company surviving the merger as a wholly owned subsidiary of Parent. Parent and Merger Sub are beneficially owned by Mr. Xianfu Zhu. At the special meeting, we will ask you to adopt the merger agreement.

If the merger is completed, at the effective time of the merger, all shares of Company common stock will be cancelled, and, other than as provided below, each share of Company common stock that has been canceled will be converted into the right to receive $13.50 in cash, without interest and less any applicable withholding taxes. We refer to this amount as the “ per share merger consideration .” The following shares of Company common stock will not be converted into the right to receive the per share merger consideration in connection with the merger: (a) shares of common stock owned by the Company as treasury stock and shares owned by Parent or Merger Sub, including shares contributed to Parent by the Rollover Investors (as defined below), all of which shares of common stock will be canceled at the effective time of the merger without the right to receive any consideration thereon, and (b) shares of common stock owned by stockholders who have exercised, perfected and not withdrawn a demand for or lost the right to, appraisal rights under the Delaware General Corporation Law, which shares of common stock will be canceled at the effective time for the merger and will entitle the former holders thereof to receive the appraised value thereon in accordance with such holder’s appraisal rights under the Delaware General Corporation Law.

A special committee of our board of directors, consisting entirely of independent directors, reviewed and considered the terms and conditions of the merger agreement and the transactions contemplated by the merger agreement, including the merger. This special committee unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable, fair (both substantively and procedurally) to and in the best interests of the Company and its unaffiliated stockholders, and recommended that our board of directors approve and declare the advisability of the merger agreement and the transactions contemplated by the merger agreement, including the merger, and recommend that our stockholders adopt the merger agreement. Our board of directors, after careful consideration and acting on the unanimous recommendation of the special committee, deemed it advisable and in the best interests of the Company and our stockholders that the Company enter into the merger agreement, determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable, fair (both substantively and procedurally) to and in the best interests of the Company and its unaffiliated stockholders and recommended that our stockholders adopt the merger agreement at the special meeting. Our board of directors recommends that you vote “FOR” the proposal to adopt the merger agreement. Our board of directors also recommends that you vote “FOR” the proposal to approve, on an advisory (non-binding) basis, specified compensation that may become payable to the named executive officers of the Company in connection with the merger, which is limited to the cash out of stock options at the excess of the per share merger consideration over the relevant exercise price per share.

The merger cannot be completed unless the merger agreement is adopted by (i) stockholders holding at least a majority of the outstanding shares of Company common stock at the close of business on the record date and (ii) stockholders holding at least a majority of the outstanding shares of the Company’s common stock at the close of business on the record date other than shares owned by Parent, Merger Sub, the Rollover Investors or any of their respective affiliates. More information about the merger is contained in the accompanying proxy statement and a copy of the merger agreement is attached thereto as Annex A.

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In considering the recommendation of the special committee and the board of directors, you should be aware that some of the Company’s directors and executive officers have interests in the merger that are different from, or in addition to, the interests of our stockholders generally. Mr. Xianfu Zhu, our Chairman and Chief Executive Officer, beneficially owns approximately 17.3% of the total number of outstanding shares of Company common stock. Mr. Xianfu Zhu, Mr. Baoke Ben, Mr. Chaoyang Liu, Mr. Qinghe Wang, Mr. Shuichi Si and Ms. Juanjuan Wang (collectively, the “ Rollover Investors ”) have agreed with Parent to contribute to Parent all of the shares of Company common stock owned by them in exchange for ordinary shares of Jinqiao Investments Limited immediately prior to the completion of the merger. The Rollover Investors, including Mr. Xianfu Zhu, own approximately 26% of the total number of outstanding shares of Company common stock. The accompanying proxy statement includes additional information regarding certain interests of the Company’s directors and executive officers that may be different from, or in addition to, the interests of our stockholders generally.

We encourage you to read the accompanying proxy statement in its entirety because it explains the proposed merger, the documents related to the merger and other related matters.

Regardless of the number of shares of Company common stock you own, your vote is important. The failure to vote will have the same effect as a vote against the proposal to adopt the merger agreement but will have no effect on the outcome of the proposal to approve, on an advisory (non-binding) basis, specified compensation that may become payable to the named executive officers of the Company in connection with the merger. Whether or not you plan to attend the special meeting, please take the time to submit a proxy by following the instructions on your proxy card as soon as possible. If your shares of Company common stock are held in an account at a broker, dealer, commercial bank, trust company or other nominee, you should instruct your broker, dealer, commercial bank, trust company or other nominee how to vote in accordance with the voting instruction form furnished by your broker, dealer, commercial bank, trust company or other nominee.

We appreciate your continued support of the Company.

Sincerely,

/s/ Xianfu Zhu   

Xianfu Zhu
Chairman of the board of directors

/s/ Raymond Leal   

Raymond Leal
Chairman of the special committee

The merger has not been approved or disapproved by the Securities and Exchange Commission or any state securities commission. Neither the Securities and Exchange Commission nor any state securities commission has passed upon the merits or fairness of the merger or upon the adequacy or accuracy of the information contained in this document or the accompanying proxy statement. Any representation to the contrary is a criminal offense.

The accompanying proxy statement is dated May 28, 2013 and is first being mailed to stockholders on or about May 29, 2013.

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ZHONGPIN INC.

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(ii) stockholders holding at least a majority of the outstanding shares of the Company’s common stock at the close of business on the record date other than shares owned by Parent, Merger Sub, the Rollover Investors or any of their respective affiliates. The approval of, on an advisory (non-binding) basis, specified compensation that may become payable to the named executive officers of the Company in connection with the merger requires the affirmative vote of the holders of at least a majority of the shares of the Company common stock present and entitled to vote at the special meeting as of the record date, assuming a quorum is present. The adjournment of the special meeting requires the affirmative vote of the holders of at least a majority of the shares of the Company common stock present and entitled to vote at the special meeting as of the record date, whether or not a quorum is present.

Regardless of the number of shares of Company common stock you own, your vote is important. The failure to vote will have the same effect as a vote against the proposal to adopt the merger agreement but will have no effect on the outcome of the proposal to approve, on an advisory (non-binding) basis, specified compensation that may become payable to the named executive officers of the Company in connection with the merger. Whether or not you plan to attend the special meeting, please take the time to submit a proxy by following the instructions on your proxy card as soon as possible. If your shares of Company common stock are held in an account at a broker, dealer, commercial bank, trust company or other nominee, you should instruct your broker, dealer, commercial bank, trust company or other nominee how to vote in accordance with the voting instruction form furnished by your broker, dealer, commercial bank, trust company or other nominee.

Company stockholders who do not vote in favor of adoption of the merger agreement will have the right to seek appraisal and receive the fair value of their shares in lieu of receiving the per share merger consideration if the merger closes but only if they perfect their appraisal rights by complying with the required procedures under Delaware law, which are summarized in the accompanying proxy statement.

If you plan to attend the special meeting, please note that you may be asked to present valid photo identification, such as a driver’s license or passport. If you wish to attend the special meeting and your shares of Company common stock are held in an account at a broker, dealer, commercial bank, trust company or other nominee (i.e., in “street name”), you will need to bring a copy of your voting instruction card or statement reflecting your share ownership as of the record date.

By Order of the Board of Directors,

/s/ Xianfu Zhu   

Xianfu Zhu
Chairman of the board of directors
Changge City, Henan Province, People’s Republic of China
May 28, 2013

YOUR VOTE IS IMPORTANT

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING IN PERSON, YOU ARE ENCOURAGED TO VOTE AS SOON AS POSSIBLE. YOU MAY VOTE YOUR SHARES OF COMPANY COMMON STOCK BY TELEPHONE, OVER THE INTERNET, OR IF YOU RECEIVED A PAPER COPY OF THE PROXY CARD, BY SIGNING AND DATING IT AND RETURNING IT PROMPTLY. VOTING BY PROXY WILL NOT PREVENT YOU FROM ATTENDING THE MEETING AND VOTING IN PERSON IF YOU SO DESIRE.

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SUMMARY VOTING INSTRUCTIONS

Ensure that your shares of Company common stock can be voted at the special meeting by submitting your proxy or contacting your broker, dealer, commercial bank, trust company or other nominee.

If your shares of Company common stock are registered in the name of a broker, dealer, commercial bank, trust company or other nominee: check the voting instruction card forwarded by your broker, dealer, commercial bank, trust company or other nominee to see which voting options are available or contact your broker, dealer, commercial bank, trust company or other nominee in order to obtain directions as to how to ensure that your shares of Company common stock are voted at the special meeting.

If your shares of Company common stock are registered in your name: submit your proxy as soon as possible by telephone, via the Internet or by signing, dating and returning the enclosed proxy card in the enclosed postage-paid envelope, so that your shares of Company common stock can be voted at the special meeting.

Instructions regarding telephone and Internet voting are included on the proxy card.

The failure to vote will have the same effect as a vote against the proposal to adopt the merger agreement but will have no effect on the outcome of the proposal to approve, on an advisory (non-binding) basis, specified compensation that may become payable to the named executive officers of the Company in connection with the merger. If you sign, date and mail your proxy card without indicating how you wish to vote, your proxy will be voted in favor of the proposal to adopt the merger agreement, the proposal to approve, on an advisory (non-binding) basis, specified compensation that may become payable to the named executive officers of the Company in connection with the merger, and the proposal to adjourn the special meeting, if necessary and appropriate, to solicit additional proxies.

If you have any questions, require assistance with voting your proxy card,
or need additional copies of proxy material, please call
MacKenzie Partners, Inc., the firm assisting us with this proxy solicitation, at +1 (212) 929-5500 (Collect call) or toll free at +1 (800) 322-2885.

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CONTENTS

PROXY STATEMENT			1
SUMMARY TERM SHEET			1
QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER			12
SPECIAL FACTORS			16
The Parties			16
Business and Background of Natural Persons Related to the Company			17
Business and Background of Natural Persons Related to China Wealth, Parent, Merger Sub and Holdco			18
Overview of the Transaction			19
Purpose of the Merger			19
Management and Board of Directors of the Surviving Corporation			20
Background of the Merger			20
Recommendation of Our Board of Directors and Special Committee; Reasons for Recommending the Adoption of the Merger Agreement; Fairness of the Merger			34
Opinion of Cowen and Company (Asia) Limited, Financial Advisor to the Special Committee			41
Opinion of Duff & Phelps Securities, LLC, Financial Advisor to the Special Committee			48
Purposes and Reasons of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors for the Merger			58
Positions of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors Regarding the Fairness of the Merger			58
Certain Effects of the Merger			60
Alternatives to the Merger			62
Effects on the Company if the Merger is not Completed			63
Plans for the Company			63
Prospective Financial Information			63
Financing of the Merger			66
Limited Guaranties			67
Voting Agreement			68
Interests of the Company’s Directors and Executive Officers in the Merger			68
Relationship Between Us and Mr. Xianfu Zhu and the Rollover Investors			71
Dividends			72
Determination of the Per Share Merger Consideration			72
Regulatory Matters			72
Estimated Fees and Expenses			72
Material United States Federal Income Tax Consequences			72
Material PRC Income Tax Consequences			75
Delisting and Deregistration of the Company’s Common Stock			76
Litigation Relating to the Merger			76
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS			78
THE SPECIAL MEETING			79
Date, Time and Place			79
Purpose of the Special Meeting			79
Recommendation of Our Board of Directors and Special Committee			79
Record Date; Stockholders Entitled to Vote; Quorum			79
Vote Required			80
Stock Ownership and Interests of Certain Persons			81
Voting Procedures			81
Other Business			82

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Revocation of Proxies			82
Rights of Stockholders Who Object to the Merger			82
Solicitation of Proxies			83
Assistance			83
THE MERGER AGREEMENT			84
Explanatory Note Regarding the Merger Agreement			84
Effects of the Merger; Directors and Officers; Certificate of Incorporation; Bylaws			84
Closing and Effective Time of the Merger			84
Treatment of Common Stock and Options			85
Exchange and Payment Procedures			85
Financing			86
Representations and Warranties			87
Conduct of Our Business Pending the Merger			90
Solicitation of Alternative Transaction Proposals			91
Stockholders Meeting			93
Filings; Other Actions; Notification			93
Accounting Treatment of the Merger			93
Conditions to the Merger			93
Termination			94
Termination Fees			95
Expenses			96
Remedies			96
Indemnification; Directors’ and Officers’ Insurance			97
Access			98
Modification or Amendment			98
COMMON STOCK OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS			99
COMMON STOCK TRANSACTION INFORMATION			101
APPRAISAL RIGHTS			102
SELECTED FINANCIAL INFORMATION			105
MARKET PRICE AND DIVIDEND INFORMATION			107
STOCKHOLDER PROPOSALS AND NOMINATIONS			108
Inclusion of Proposals in Our Proxy Statement and Proxy Card Under the SEC’s Rules			108
WHERE YOU CAN FIND MORE INFORMATION			108
ANNEX A: MERGER AGREEMENT			A-1
ANNEX B: OPINION OF COWEN AND COMPANY (ASIA) LIMITED			B-1
ANNEX C: OPINION OF DUFF & PHELPS, LLC			C-1
ANNEX D: DELAWARE GENERAL CORPORATION LAW SECTION 262			D-1

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ZHONGPIN INC.

SPECIAL MEETING OF STOCKHOLDERS

TO BE HELD JUNE 27, 2013

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Parent is located at the offices of Offshore Incorporations (Cayman) Limited, Floor 4, Willow House, Cricket Square, P O Box 2804, Grand Cayman KY1-1112, Cayman Islands and its telephone number is +86 374 6219316.

Golden Bridge Merger Sub Limited

Golden Bridge Merger Sub Limited, which we refer to as “ Merger Sub ” was incorporated under the laws of Delaware and was formed by Mr. Xianfu Zhu for the sole purpose of entering into the merger agreement and consummating the transactions contemplated by the merger agreement. The registered office of Merger Sub is located in the City of Wilmington, County of New Castle, State of Delaware, United States of America and its telephone number is +86 374 6219316.

Rollover Investors

The Rollover Investors have agreed with Parent to contribute to Parent all of the shares of Company common stock owned by them (the “ Rollover Shares ”), representing 26% of the total number of outstanding shares of Company common stock, including the shares owned by Mr. Xianfu Zhu, in exchange for ordinary shares of Holdco immediately prior to the completion of the merger.

Overview of the Transaction
(page 19)

The Company, Parent, Merger Sub and Mr. Xianfu Zhu entered into the merger agreement on February 8, 2013, which amended and restated the original merger agreement signed on November 26, 2012. Under the terms of the merger agreement, Merger Sub will be merged with and into the Company, with the Company surviving the merger as a wholly owned subsidiary of Parent. The following will occur in connection with the merger:

Following and as a result of the merger:

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The Special Meeting
(page 79)

The special meeting will be held on June 27, 2013 at 21 Changshe Road, Changge City, Henan Province, People’s Republic of China 461500. At the special meeting, you will be asked to, among other things, adopt the merger agreement. Please see the section of this proxy statement captioned “ Questions and Answers About the Special Meeting and the Merger ” for additional information on the special meeting, including how to vote your shares of Company common stock.

Stockholders Entitled to Vote; Vote Required to Adopt the Merger Agreement
(page 79)

You may vote at the special meeting if you owned any shares of Company common stock at the close of business on May 23, 2013, the record date for the special meeting. On that date, there were 37,209,344 shares of Company common stock outstanding and entitled to vote at the special meeting. You may cast one vote for each share of Company common stock that you owned on that date. Adoption of the merger agreement requires the affirmative vote of (i) stockholders holding at least a majority of the outstanding shares of the Company’s common stock at the close of business on the record date and (ii) stockholders holding at least a majority of the outstanding shares of the Company’s common stock at the close of business on the record date other than shares owned, directly or indirectly, by Parent, Merger Sub, the Rollover Investors or any of their respective affiliates. We refer to the approval described in clause (ii) above as the “majority of the minority” requirement. Any shares owned, directly or indirectly by Parent, Merger Sub, the Rollover Investors or any of their respective affiliates that are voted will be counted towards determining whether the resolution has passed pursuant to clause (i) above but not towards determining whether the majority of the minority vote requirement has been satisfied.

Based on the 37,209,344 shares of Company common stock outstanding on the record date for the special meeting, 18,604,673 shares must be voted in favor of the resolution to adopt the merger agreement. In the event that Mr. Xianfu Zhu and the Rollover Investors vote all of their shares to approve the resolution, which they have agreed to do pursuant to a voting agreement, 8,887,168 shares must be voted by other stockholders in favor of the resolution for it to be passed.

Based on the 37,209,344 shares of Company common stock outstanding on the record date for the special meeting, 13,745,920 of the shares held by unaffiliated stockholders must be voted in favor of the adoption of the merger agreement to satisfy the majority of the minority requirement.

Pursuant to a voting agreement, the Rollover Investors have agreed to vote 9,717,505 shares, constituting approximately 26% of the Company’s total common stock outstanding, in favor of the proposal to adopt the merger agreement.

See “ The Special Meeting ” beginning on page 79 for additional information.

Merger Consideration

If the merger is completed, at the effective time of the merger, all shares of Company common stock will be cancelled and, other than as provided below, each share of Company common stock that has been cancelled, will be converted into the right to receive $13.50 in cash, without interest and less any applicable withholding taxes. We refer to this amount as the “ per share merger consideration .” Common stock owned by the Company as treasury stock or owned by Parent or Merger Sub (including shares of Company common stock contributed to Parent by the Rollover Investors) will be canceled without payment of per share merger consideration. Shares of Company common stock owned by stockholders who have exercised, perfected and not withdrawn a demand for or lost the right to, appraisal rights under the DGCL will be canceled without payment of per share merger consideration and such stockholders will instead be entitled to appraisal rights under the DGCL.

A paying agent will send written instructions for surrendering your certificates representing shares of Company common stock (if your shares of Company common stock are certificated) and obtaining the per share merger consideration after we have completed the merger. Do not return your stock certificates with your proxy card and do not forward your stock certificates to the paying agent prior to receipt of the written instructions. If you hold uncertificated shares of Company common stock (i.e., you hold your shares in book

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entry), you will automatically receive your per share merger consideration as soon as practicable after the effective time of the merger without any further action required on your part. See “ Exchange and Payment Procedures ” beginning on page 85 for additional information.

Treatment of Company Stock Options (page 85)

The merger agreement provides that immediately prior to the effective time of the merger each outstanding stock option, whether vested or unvested, will be canceled as of the effective time of the merger and converted into the right to receive, as soon as reasonably practicable after the completion of the merger, an amount in cash equal to the excess, if any, of the per share merger consideration ($13.50) over the exercise price per share of such stock option, without interest and less any required withholding taxes. See “ The Merger Agreement — Treatment of Common Stock and Options ” beginning on page 85 for additional information.

Recommendation of Our Board of Directors and Special Committee; Reasons for Recommending the Adoption of the Merger Agreement; Fairness of the Merger
(page 34)

Our board of directors, after careful consideration and acting on the unanimous recommendation of the special committee composed entirely of independent directors, recommends that our stockholders vote “ FOR ” the proposal to adopt the merger agreement and “ FOR ” the proposal to approve the adjournment of the special meeting, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the special meeting to adopt the merger agreement. Our board of directors and the special committee believe that the merger is fair (both substantively and procedurally) to our unaffiliated stockholders. For a discussion of the material factors considered by our board of directors and the special committee in determining to recommend the adoption of the merger agreement and in determining that the merger is fair (both substantively and procedurally) to our unaffiliated stockholders, see “ Special Factors — Recommendation of Our Board of Directors and Special Committee; Reasons for Recommending the Adoption of the Merger Agreement; Fairness of the Merger ” beginning on page 34 for additional information.

Positions of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors Regarding the Fairness of the Merger
(page 58)

Each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors believes that the merger is fair (both substantively and procedurally) to our unaffiliated stockholders. However, none of China Wealth, Parent, Merger Sub or the Rollover Investors has performed, or engaged a financial advisor to perform, any valuation or other analysis for the purposes of assessing the fairness of the merger to our unaffiliated stockholders. Their belief is based upon the factors discussed under the captions, “ Special Factors — Positions of China Wealth, Parent, Merger Sub and the Rollover Investors Regarding the Fairness of the Merger ” beginning on page 58 of this proxy statement.

Purposes and Effects of the Merger
(pages 19 and 60)

If the merger is completed, all of our equity interests will be owned by Parent. Except for the Rollover Investors through their indirect interest in Parent, none of our current stockholders will have any ownership interest in, or be a stockholder of, the Company after the completion of the merger. As a result, our current stockholders (other than the Rollover Investors) will no longer benefit from any increase in our value, nor will they bear the risk of any decrease in our value. Following the merger, Parent will benefit from any increase in our value and also will bear the risk of any decrease in our value.

Shares of Company common stock are currently listed on NASDAQ under the symbol “HOGS”. It is expected that, following the consummation of the merger, the Company will cease to be a publicly traded company and shares of Company common stock will no longer be traded on NASDAQ or any other public market and will instead become a privately-held company directly owned by Parent and indirectly, through Holdco, by China Wealth and the Rollover Investors. Following the completion of the merger, the shares of Company common stock will cease to be listed on NASDAQ, and price quotations with respect to sales of shares of Company common stock in the public market will no longer be available. In addition, registration of the shares of Company common stock under the Exchange Act may be terminated upon the Company’s

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application to the SEC if the shares of Company common stock are not listed on a national securities exchange and there are fewer than 300 record holders of the shares of Company common stock. Ninety days after the filing of Form 15 in connection with the completion of the merger or such longer period as may be determined by the SEC, registration of the shares of Company stock under the Exchange Act will be terminated. At such time, the Company will no longer be required to file periodic reports with the SEC or otherwise be subject to the United States federal securities laws, including Sarbanes-Oxley, applicable to public companies, and our shareholders will no longer enjoy the rights or protections that the United States federal securities laws provide, including reporting obligations for directors, officers and principal securities holders of the Company.

Opinion of Cowen and Company (Asia) Limited (“Cowen”), Financial Advisor to the Special Committee
(page 41)

On February 8, 2013, Cowen rendered an oral opinion to the special committee (which was confirmed in writing by delivery of Cowen’s written opinion dated the same date), as to the fairness, from a financial point of view, to the holders of the Company’s common stock, other than shares held by (i) the Company as treasury stock and any wholly owned subsidiary of the Company, (ii) Parent, Merger Sub and the Rollover Investors and (iii) stockholders of the Company who have properly exercised and perfected their appraisal rights under Delaware law (together, the “ Excluded Holders ”) of the per share merger consideration.

The full text of the written opinion of Cowen, dated February 8, 2013, is attached to this proxy statement as Annex B and is incorporated by reference. Holders of the Company’s common stock are urged to read the opinion in its entirety for the assumptions made, procedures followed, other matters considered and limits of the review by Cowen. Cowen’s analyses and opinion were prepared for and addressed to the special committee and are directed only to the fairness, from a financial point of view, of the per share merger consideration and do not constitute an opinion as to the merits of the proposed merger or a recommendation to any stockholder as to how to vote on the proposed merger. The per share merger consideration was determined through negotiations between the special committee and Mr. Xianfu Zhu and not pursuant to recommendations of Cowen.

Opinion of Duff & Phelps, LLC (“Duff & Phelps”), Financial Advisor to the Special Committee
(page 48)

On February 8, 2013, Duff & Phelps rendered an oral opinion to the special committee (which was confirmed in writing by delivery of Duff & Phelps’ written opinion dated the same date), as to the fairness, from a financial point of view, to the public stockholders of the Company (other than the Rollover Investors and affiliates of the Rollover Investors to the extent applicable and shares held by stockholders who have exercised, perfected and not withdrawn a demand for or lost the right to, appraisal rights under the DGCL) of the $13.50 per share merger consideration to be received by such stockholders in connection with the merger (without giving effect to any impact of the merger on any particular stockholder of the Company other than in its capacity as a stockholder).

The full text of the written opinion of Duff & Phelps, dated February 8, 2013, is attached to this proxy statement as Annex C and is incorporated by reference. The opinion should be read carefully in its entirety for a description of the assumptions made, procedures followed, matters considered and qualifications and limitations of the review undertaken in connection with the opinion. The opinion of Duff & Phelps was addressed to the special committee, was given solely with respect to the merger and is not intended to be used, and may not be used, for any other purpose.

Financing of the Merger
(page 66)

Parent estimates that the total amount of funds required to complete the merger and related transactions, including payment of fees and expenses in connection with the merger but excluding the investment of the Rollover Investors, is anticipated to be approximately $376 million. This amount is expected to be provided through a combination of (i) equity contributions from China Wealth totaling approximately $85 million, (ii) rollover financing from the Rollover Investors totaling approximately $131 million (based on the number

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of shares of common stock they own and the per share merger consideration); and (iii) debt financing of approximately $320 million. See “ Special Factors — Financing of the Merger ” beginning on page 66 for additional information.

Limited Guaranties
(page 67)

Mr. Xianfu Zhu and China Wealth have agreed to guarantee 60.61% and 39.39% (determined based upon the relative size of their equity commitments to Parent) respectively, of the obligations of Parent under the merger agreement to pay, under certain circumstances, a reverse termination fee, but Mr. Xianfu Zhu has also agreed to be liable for the entire amount of the obligations of Parent if Parent and China Wealth default on their obligations. See “ Special Factors — Limited Guaranties ” beginning on page 67 for additional information.

Interests of the Company’s Directors and Executive Officers in the Merger
(page 68)

In considering the recommendation of our board of directors, you should be aware that certain of our executive officers and directors have interests in the merger that may be different from, or in addition to, your interests as a stockholder. These interests include, among others:

See “ Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger ” beginning on page 68 for additional information.

Accounting Treatment of the Merger
(page 93)

The merger is expected to be accounted for, at historical cost, as a merger of entities under common control in accordance with Accounting Standards Codification 805-50, “Business Combinations — Related Issues.”

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Conditions to the Merger
(page 93)

The respective obligations of each of the Company, Parent and Merger Sub to consummate the merger are subject to the satisfaction or waiver of certain conditions. For a more detailed description of these conditions, please see “ The Merger Agreement — Conditions to the Merger ” beginning on page 93.

Regulatory Approvals
(page 72)

Other than filing the certificate of merger with the Secretary of State of the State of Delaware in accordance with the DGCL after the adoption of the merger agreement by our stockholders and complying with U.S. federal securities laws, none of the parties is aware of any other required regulatory approvals. See “ Special Factors — Regulatory Matters ” beginning on page 72.

Solicitation of Alternative Transaction Proposals
(page 91)

At any time from and after the execution of the merger agreement and until the effective time or, if earlier, the termination of the merger agreement, the Company, its subsidiaries and its representatives may not:

At any time from and after 12:00 a.m., Beijing time, on February 8, 2013 and prior to the time the Company’s stockholders adopt the merger agreement, if the Company receives an unsolicited written alternative transaction proposal from any person, the Company may:

The Company must promptly advise Parent of any alternative transaction proposal, any initial request for non-public information concerning the Company or its subsidiaries from any person or group who would reasonably be expected to make an alternative transaction proposal and provide to Parent the material terms and conditions of any alternative transaction proposal including the identity of the person making such alternative transaction proposal.

Termination of the Merger Agreement
(page 94)

The Company and Parent may, by mutual written consent duly authorized by each of their respective boards of directors (in the case of the Company, acting upon the recommendation of the special committee), terminate the merger agreement and abandon the merger at any time prior to the effective time, whether before or after the adoption of the merger agreement by the Company’s stockholders.

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The merger agreement may also be terminated and the merger abandoned at any time prior to the effective time as follows:

by either Parent or the Company, if:

by Parent, if:

by the Company, if:

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Termination Fees (page 95)

The merger agreement contains certain termination rights for the Company and Parent. Upon termination of the merger agreement under specified circumstances, the Company will be required to pay Parent a termination fee of $4.75 million. The merger agreement also provides that Parent will be required to pay the Company a reverse termination fee of $12.5 million in the event that the Company terminates the merger agreement because of Parent’s breach of the merger agreement or because Parent has not closed the merger within ten business days of notice that all conditions are satisfied. See “ The Merger Agreement — Termination Fees ” beginning on page 95.

Remedies
(page 96)

The Company’s right to receive the reverse termination fee from Parent (or Mr. Xianfu Zhu or China Wealth pursuant to the limited guaranties) and certain reimbursement and indemnification payments from Parent will be, subject to certain rights described below, the sole and exclusive remedy of the Company against Parent, Merger Sub, the guarantors, the Rollover Investors, the financing sources of the debt financing or any of their respective former, current or future general or limited partners, stockholders, financing sources, managers, members, directors, officers or affiliates for any loss suffered as a result of the failure of the merger to be consummated or for a breach or failure to perform under the merger agreement or otherwise, and upon payment of such amount(s) by Parent (or Mr. Xianfu Zhu or China Wealth pursuant to the limited guaranties) no other party shall have any further liability or obligation relating to or arising out of the merger agreement or the transactions contemplated thereby.

Parent’s right to receive payment from the Company the applicable termination fee will be, subject to equitable relief, including specific performance, described below, the sole and exclusive remedy of Parent and Merger Sub (and the other related parties described in the preceding paragraph) against the Company and its subsidiaries and any of their respective former, current or future officers, directors, partners, stockholders, managers, members or affiliates for any loss suffered as a result of the failure of the merger to be consummated or for a breach or failure to perform under the merger agreement or otherwise, and upon payment of such amount(s) by the Company, no other party will have any further liability or obligation relating to or arising out of the merger agreement or the transactions contemplated thereby.

Parent and Merger Sub are entitled to an injunction or injunctions, specific performance or other equitable relief to prevent breaches of the merger agreement and to enforce specifically the terms and provisions thereof, in addition to any other remedy to which they are entitled under the merger agreement. The Company shall be entitled to enforce specifically the obligation of Parent and Merger Sub to send a drawdown notice under the facility agreement (as defined below, or the alternative financing agreement, if applicable) if the conditions to which the obligations of Parent and Merger Sub to consummate the merger are subject have been satisfied (other than conditions which by their nature cannot be satisfied until the effective time) and the funds contemplated by the facility agreement shall be available.

Appraisal Rights
(page 102)

If the merger is consummated, persons who are stockholders of the Company will have certain rights under Delaware law to dissent and demand appraisal of, and payment in cash of the fair value of, their shares of Company common stock. Any shares of Company common stock held by a person who does not vote in favor of the adoption of the merger agreement, and demands appraisal of such shares of Company common stock in compliance with the applicable provisions of Delaware law will not be converted into the right to receive the per share merger consideration. A stockholder’s failure to vote against the merger will not constitute a waiver of his, her or its appraisal rights. However, if you sign and return a proxy card without indicating how you want your shares voted or vote by submitting a proxy by telephone or the Internet without abstaining or

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expressly directing that your shares of Company common stock be voted against the adoption of the merger agreement, you will waive your appraisal rights because such shares represented by the proxy will be voted for the adoption of the merger agreement. Accordingly, if you desire to exercise and perfect appraisal rights with respect to any of your shares of Company common stock, you must check either the “against” or the “abstain” box next to the proposal on your card, vote in person or by submitting a proxy by telephone or the Internet against the proposal, register in person an abstention with respect thereto or not vote with respect to the transaction. A vote or proxy against the adoption of the merger agreement will not, in and of itself, constitute a demand for appraisal. Neither voting against the proposal to adopt the merger agreement, nor abstaining from voting or failing to vote on the proposal to adopt the merger agreement, will in and of itself constitute a written demand for appraisal satisfying the requirements of Section 262. The written demand for appraisal must be in addition to and separate from any proxy or vote on the proposal to adopt the merger agreement. Such appraisal rights, if the statutory procedures were complied with, will lead to a judicial determination of the fair value (excluding any element of value arising from the accomplishment or expectation of the merger) required to be paid in cash to such dissenting stockholders for their shares of Company common stock. The value so determined could be more or less than, or the same as, per share merger consideration.

You should read “ Appraisal Rights ” beginning on page 102 for a more complete discussion of the appraisal rights in relation to the merger as well as Annex D which contains a full text of the applicable Delaware statute.

Litigation Relating to the Merger
(page 76)

The Company and the members of the board of directors are named as defendants in purported class action lawsuits brought by stockholders of the Company. The lawsuits allege, among other things, that the members of the board of directors breached their fiduciary duties owed to the Company’s public stockholders and seek, among other things, to enjoin the defendants from completing the merger on the agreed-upon terms.

One of the conditions to the closing of the merger is that no injunction, judgment or ruling by a court or other governmental entity shall be in effect that enjoins, restrains, prevents or prohibits consummation of the merger or that makes the consummation of the merger illegal. As such, if the plaintiffs are successful in obtaining an injunction prohibiting the defendants from completing the merger on the agreed-upon terms, then such injunction may prevent the merger from becoming effective, or from becoming effective within the expected timeframe.

Material United States Federal Income Tax Consequences
(page 72)

The exchange of shares of Company common stock for cash pursuant to the merger will be a taxable transaction for U.S. federal income tax purposes. In general, a U.S. Holder (as defined below) who receives cash for shares of Company common stock pursuant to the merger will recognize gain or loss, if any, equal to the difference between the amount of cash received and the holder’s adjusted tax basis in the shares of Company common stock. You should read “ Special Factors — Material United States Federal Income Tax Consequences ” beginning on page 72 for more information regarding the United States federal income tax consequences of the merger to stockholders. Because individual circumstances may differ, we urge stockholders to consult their tax advisors for a complete analysis of the effect of the merger on their U.S. federal, state and local and/or non-U.S. taxes.

Material PRC Income Tax Consequences
(page 75)

The Company does not believe that it should be considered a resident enterprise under the PRC Enterprise Income Tax Law (the “ EIT Law ”) or that the gain recognized on the receipt of cash for shares of Company common stock pursuant to the merger should be subject to PRC tax to holders of such stock that are not PRC residents. If, however, the PRC tax authorities were to determine that the Company should be considered a resident enterprise or that the receipt of cash for shares of Company common stock should otherwise be subject to PRC tax, then gain recognized on the receipt of cash for shares of Company common stock

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pursuant to the merger or through the exercise of appraisal rights by our stockholders who are not PRC residents could be treated as PRC-source income that would be subject to PRC income tax at a rate of 20% in the case of individuals or 10% in the case of corporations (subject to applicable treaty relief). You should consult your own tax advisor for a full understanding of the tax consequences of the merger or the exercise of appraisal rights to you, including any PRC tax consequences. Please see “ Special Factors — Material PRC Income Tax Consequences ” beginning on page 75 for additional information.

Background — Certain Developments Prior to the Execution of the Original Merger Agreement

Prior to the execution of the original merger agreement on November 26, 2012:

Please see “ Special Factors — Background of the Merger” beginning on page 20 for additional information regarding Company A’s non-binding proposal, including the conditions related thereto, the circumstances surrounding Barclay’s resignation as financial advisor to the special committee and the purported offer of $13.75 per share by Mr. Xianfu Zhu and the special committee’s determination to approve the transaction prior to receipt of a fairness opinion.

Additional Information
(page 108)

You can find more information about the Company in the periodic reports and other information we file with the U.S. Securities and Exchange Commission (“ SEC ”). The information is available at the SEC’s public reference facilities and at the website maintained by the SEC at www.sec.gov. For a more detailed description of the additional information available, please see the section entitled “ Where You Can Find More Information ” beginning on page 108.

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

At the close of business on May 23, 2013, the record date, 37,209,344 shares of Company common stock were outstanding and entitled to vote at the special meeting. Approximately 18,604,673 shares must be voted in favor of the resolution to adopt the merger agreement, assuming all stockholders will be present and voting in person or by proxy at the special meeting. In the event that Mr. Xianfu Zhu and the Rollover Investors vote all of their shares to approve the resolution, which they have agreed to do, 8,887,168 shares must be voted by other stockholders in favor of the resolution for it to be passed.

Based on the 37,209,344 shares of Company common stock outstanding and entitled to vote at the special meeting, approximately 13,745,920 of the shares held by unaffiliated stockholders must be voted in favor of the adoption of the merger agreement to satisfy the majority of the minority requirement.

Pursuant to a voting agreement, the Rollover Investors have agreed to vote 9,717,505 shares, constituting approximately 26% of the Company’s total common stock outstanding, in favor of the proposal to adopt the merger agreement at the special meeting.

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You should read “ Special Factors — Recommendation of our Board of Directors and Special Committee; Reasons for Recommending the Adoption of the Merger Agreement; Fairness of the Merger ” beginning on page 34 for a discussion of the factors that our special committee and board of directors considered in deciding to recommend the adoption of the merger agreement. In addition, in considering the recommendation of the special committee and the board of directors with respect to the merger agreement, you should be aware that some of the Company’s directors and executive officers may have interests that are different from, or in addition to, the interests of our stockholders generally. See “ Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger, ” beginning on page 68.

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If you properly transmit and sign your proxy, but do not indicate how you want to vote, your proxy will be voted “FOR” the adoption of the merger agreement, “FOR” the proposal to approve, on an advisory (non-binding) basis, specified compensation that may become payable to the named executive officers of the Company in connection with the merger, and “FOR” the proposal to approve the adjournment of the special meeting, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the special meeting to adopt the merger agreement.

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Holders of uncertificated shares of Company common stock (i.e., holders whose shares are held in book entry) will automatically receive their cash consideration promptly after the effective time of the merger without any further action required on the part of such holders.

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SPECIAL FACTORS

The following description is a summary of the material aspects of the merger. While we believe that the following description covers the material terms of the merger, the description may not contain all of the information that is important to you. We encourage you to read carefully this entire document, including the Amended and Restated Agreement and Plan of Merger attached to this proxy statement as Annex A for a more complete understanding of the merger.

The Parties

Zhongpin Inc.

Zhongpin Inc. is a meat and food processing company that specializes in pork and pork products, and fruits and vegetables in the People's Republic of China. The company is a leading enterprise in developing a nationally recognized high quality brand for meats and food products through a brand image that appeals to the new Chinese middle class lifestyle. Zhongpin’s philosophy is to embrace the modern Chinese culture by being a positive part of everyday meals which bring happiness for today and for future generations. The Company has a complete state-of-the-art vertically-integrated fresh meat and meat products supply chain from farming, slaughtering, cutting, processing and wholesaling to retailing. The Company’s advanced logistic system includes integration and coordination of the transportation, warehouse management and inventory control systems as well as the integration of its marketing and manufacturing. All of the production lines are ISO 9001 certified, have passed HACCP (Hazard Analysis and Critical Control Point) under GMP (Good Manufacturing Practice) and SSOP (Sanitation Standard Operating Procedure in China). The Company also exports its products to the Europe, Hong Kong as well as other selected countries and regions in Asia. The Company’s principal executive offices are located at 21 Changshe Road, Changge City, Henan Province, People’s Republic of China 461500 and its telephone number is +86 374 6216633.

China Wealth Growth Fund I L.P.

China Wealth Growth Fund I L.P. is organized as a private equity fund under the laws of the Cayman Islands. ZT China Wealth Management Limited, a Cayman Islands company, is the general partner of China Wealth Growth Fund I L.P. and is responsible for operating and managing the fund. The assets of the fund are to be invested in China-related companies, especially in areas of consumer products and advanced manufacturing. The registered offices of China Wealth Growth Fund I L.P. and ZT China Wealth Management Limited are located at Intertrust Corporate Services (Cayman) Limited, 87 Mary Street, George Town, Grand Cayman, KY1-9005, and their telephone number is +86 10 8532 5935.

Rollover Investors

The Rollover Investors are Mr. Xianfu Zhu, Mr. Baoke Ben, Mr. Chaoyang Liu, Mr. Qinghe Wang, Mr. Shuichi Si and Ms. Juanjuan Wang.

Information on Mr. Xianfu Zhu, Mr. Baoke Ben and Mr. Chaoyang Liu is set forth below in “ Special Factors — Business and Background of Natural Persons Related to the Company. ”

Jinqiao Investments Limited

Jinqiao Investments Limited, a business company with limited liability incorporated under the laws of the British Virgin Islands which we refer to as “ Holdco ”, was formed by Mr. Xianfu Zhu solely for the purpose of owning the Parent and Merger Sub and, after the merger, the Company. Holdco is owned by Mr. Xianfu Zhu. Holdco has not engaged in any business except for activities incidental to its formation and in connection with the merger and the other transactions contemplated by the merger agreement. The registered offices of Holdco are located at P O Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands, and its telephone number is +86 374 6219316.

Golden Bridge Holdings Limited

Golden Bridge Holdings Limited, a Cayman Islands exempt company with limited liability which we refer to as “ Parent ,” was formed by Mr. Xianfu Zhu solely for the purpose of owning the Company after the merger and arranging the related financing transactions. Parent is currently owned by Holdco. Parent has not engaged

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in any business except for activities incidental to its formation and in connection with the merger and the other transactions contemplated by the merger agreement. The registered offices of Parent are located at the offices of Offshore Incorporations (Cayman) Limited, Floor 4, Willow House, Cricket Square, P.O. Box 2804, Grand Cayman KY1-1112, Cayman Islands, Cayman Islands, and its telephone number is +86 374 6219316.

Golden Bridge Merger Sub Limited

Golden Bridge Merger Sub Limited, a Delaware corporation which we refer to as “ Merger Sub ,” was formed by Parent solely for the purpose of completing the merger. Merger Sub is wholly owned by Parent and has not engaged in any business except for activities incidental to its formation and in connection with the merger and the other transactions contemplated by the merger agreement. Upon the completion of the merger, Merger Sub will cease to exist. The principal executive offices of Merger Sub are located in City of Wilmington, State of Delaware, United States of America and its telephone number is +86 3746219316.

Business and Background of Natural Persons Related to the Company

Set forth below for each director and executive officer of the Company is his or her respective present principal occupation or employment, the name of the corporation or other organization in which such occupation or employment is conducted and the five-year employment history of each such director or executive officer. None of the Company nor any of the Company’s directors or executive officers has, during the past five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). None of the Company nor any of the Company’s directors or executive officers listed below has, during the past five years, been a party to any judicial or administrative proceeding (except for matters that were dismissed without sanction or settlement) that resulted in a judgment, decree or final order enjoining the person from future violations of, or prohibiting activities subject to, federal or state securities laws, or a finding of any violation of federal or state securities laws. Each of the individuals listed below, with the exception of Mr. Leal, is a citizen of the People’s Republic of China. Mr. Leal is a citizen of the United States.

Executive Officers

Xianfu Zhu.   Mr. Xianfu Zhu has served as Chairman of our board of directors and our Chief Executive Officer since January 2006. Mr. Xianfu Zhu has been Chairman and Chief Executive Officer of our wholly-owned subsidiary and the predecessor to our company, Henan Zhongpin Food Share Co., Ltd. (“ Henan Zhongpin ”) since its inception in 1993. Mr. Xianfu Zhu graduated from Beijing Technology and Business University and received an EMBA from Tsinghua University.

Baoke Ben.   Mr. Ben became our director in June 2007 and became our Executive Vice President in January 2006. Mr. Ben has been an Executive Vice President of Henan Zhongpin since July 2002 and was Director of Technology of Henan Zhongpin from October 1999 to July 2002. Prior to joining Henan Zhongpin in October 1999, Mr. Ben was a researcher at the Agriculture Research Center. Mr. Ben graduated from Henan Finance & Economy University and received his EMBA from Tsinghua University.

Feng Wang.   Mr. Wang has served as our Vice President, Chief Financial Officer, Financial Controller and Treasurer since October 2008. Prior to joining us, Mr. Wang served as Group Finance Controller at Agria Corporation, an agri-solutions provider that is listed on the New York Stock Exchange, from November 2007 to September 2008, as Deputy Chief Financial Officer at Beijing Media Company, an adverting sales company that is listed on the Stock Exchange of Hong Kong, from September 2006 to November 2007, and as Finance Director of Mediact Jingwen Media Group, a music publishing, advertising and public relations company located in Beijing, from January 2005 to August 2006.

Chaoyang Liu.   Mr. Liu has served as our Vice President of Operations since September 2007. Mr. Liu has also been serving as General Manager of our chilled and frozen products department since June 2005. In addition, Mr. Liu has served as Chairman of Henan Zhongpin Business Development Co., Ltd. since September 2006 and Chairman of Heilongjiang Zhongpin Food Co., Ltd. since November 2006. Mr. Liu joined Henan Zhongpin in 1993 and has been responsible for several areas of its operations, including product distribution, market research and product improvement.

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Directors (other than Mr. Xianfu Zhu and Mr. Baoke Ben)

Raymond Leal.   Mr. Leal has served as our director since June 2007. Mr. Leal taught as an adjunct professor at the undergraduate and graduate level at several universities from 1978 to 2008. Most recently, Mr. Leal taught mathematics and statistics at Coastal Carolina University from 1997 to 2008 and finance and accounting at Webster University from 1999 to 2005. Mr. Leal served as Financial Advisor to clients of several regional investment banks based in Atlanta, Georgia from 1990 to 2002. Prior to that, Mr. Leal managed the mergers and acquisition practice for Sun Trust Banks from 1987 to 1990, served as Vice President of Corporate Development and Treasurer at Texas Eastern Corporation, a NYSE-listed energy company, from 1981 to 1987, and served as Assistant Treasurer at Progress Energy, a NYSE-listed electric power company, from 1976 to 1981.

Yaoguo Pan.   Mr. Pan has served as our director since September 2007. Mr. Pan has been a researcher at the Development Research Center, a policy research and consulting institution directly under the State Council of the People’s Republic of China, since 1990, where he is responsible for conducting research concerning the meat industry, including in the areas of meat consumption, food supply, animal husbandry and food nutrition. Prior to that, Mr. Pan served as an assistant researcher at China’s Central Rural Policy Research Office from 1987 to 1990, and was responsible for conducting research and investigations in the areas of rural policy at China’s Central Secretariat Rural Research Office from 1982 to 1987.

Xiaosong Hu.   Mr. Hu has served as our director since June 2011. Mr. Hu is currently a professor and an advisor to Ph.D. candidates at China Agricultural University, a position he has held since 1999. He has been engaged in teaching and research work in the Food Science and Engineering College of China Agricultural University since June 1988. Mr. Hu also concurrently serves in several academic and government organizations. He is Executive Vice President of the Science and Technology Development Academy of China Agricultural University, a member of the Growth Enterprise Market Technical Committee of the China Securities Regulatory Commission, Vice President of the Chinese Institute of Food Science and Technology, a member of the Science and Technology Committee of China’s Ministry of Agriculture, a member of the Academic Committee of the Chinese Academy of Agricultural Sciences and a member of the State Food and Nutrition Consultant Committee.

Business and Background of Natural Persons Related to China Wealth, Parent, Merger Sub and Holdco

Set forth below for each director and officer of China Wealth, Parent, Merger Sub and Holdco, is his or her respective present principal occupation or employment, the name of the organization in which such occupation or employment is conducted and the five-year employment history of each such person. During the past five years, none of Parent, Merger Sub, Holdco or China Wealth and none of their respective directors or executive officers, has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). In addition, during the past five years, none of Parent, Merger Sub, Holdco or China Wealth, and none of their respective directors or executive officers, has been a party to any judicial or administrative proceeding (except for matters that were dismissed without sanction or settlement) that resulted in a judgment, decree or final order enjoining the person from future violations of, or prohibiting activities subject to, federal or state securities laws or a finding of any violation of federal or state securities laws. Each of the individuals listed below is a citizen of the People’s Republic of China.

China Wealth

Dongfang Wang.   Ms. Wang serves as the director of ZT China Wealth Management Limited since October of 2012. Prior to joining ZT China Wealth Management Limited, Ms. Wang was a practicing lawyer, specializing in advising on investment banking matters, with broad experience in corporate reorganizations, mergers and acquisitions, financings and initial public offering. Ms. Wang practiced with DeHeng Law Firm between early 2008 and early 2010, and then with Jun Ze Jun Law Firm between early 2010 and early 2011. Ms Wang joined China Wealth Management (Tianjin) Limited as head of legal affairs and deputy investment director in early 2011. Ms. Wang is licensed as a People’s Republic of China lawyer.

Parent

Xianfu Zhu.   Mr. Xianfu Zhu has served as sole director of Parent since its formation. Mr. Xianfu Zhu has been Chairman and Chief Executive Officer of Zhongpin, Inc. and its wholly-owned subsidiary and

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predecessor, Henan Zhongpin since its inception in 1993. Mr. Xianfu Zhu graduated from Beijing Technology and Business University and received an EMBA from Tsinghua University.

Merger Sub

Xianfu Zhu.   Mr. Xianfu Zhu has served as sole director, president, treasurer and secretary of Merger Sub since its formation. Mr. Xianfu Zhu has been Chairman and Chief Executive Officer of Zhongpin, Inc. and its wholly-owned subsidiary and predecessor, Henan Zhongpin since its inception in 1993. Mr. Xianfu Zhu graduated from Beijing Technology and Business University and received an EMBA from Tsinghua University.

Holdco

Xianfu Zhu.   Mr. Xianfu Zhu has served as sole director of Holdco since its formation. Mr. Xianfu Zhu has been Chairman and Chief Executive Officer of Zhongpin, Inc. and its wholly-owned subsidiary and predecessor, Henan Zhongpin since its inception in 1993. Mr. Xianfu Zhu graduated from Beijing Technology and Business University and received an EMBA from Tsinghua University.

Overview of the Transaction

The Company, Parent and Merger Sub entered into the merger agreement on February 8, 2013, which amended and restated the original merger agreement signed on November 26, 2012. Under the terms of the merger agreement, Merger Sub will be merged with and into the Company, with the Company surviving the merger as a wholly owned subsidiary of Parent. Parent and Merger Sub are beneficially owned by Mr. Xianfu Zhu. The following will occur in connection with the merger:

Following and as a result of the merger:

Purpose of the Merger

The purpose of the merger is to enable Parent to acquire 100% control of the Company in a transaction in which the Company’s unaffiliated stockholders will be cashed out in exchange for $13.50 per share of Company common stock, so that Parent will bear the rewards and risks of the ownership of the Company after the merger, including any future earnings and growth of the Company which may result from improvements to the Company’s operations or acquisitions of other businesses.

The Company believes that as a privately-held entity, the Company’s management will have greater flexibility to focus on improving the Company’s long-term profitability without the constraints caused by the public

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equity market’s valuation of the Company and emphasis on short-term period-to-period performance. As a privately-held entity, the Company will have greater flexibility to make decisions that might negatively affect short-term results, but that could increase the Company’s value over the long term. As a privately-held entity, the Company will also be relieved of many of the other expenses, burdens and constraints imposed on companies that are subject to the public reporting requirements under the federal securities laws of the United States, including the Exchange Act and Sarbanes-Oxley Act of 2002. The need for the management of the Company to be responsive to unaffiliated stockholders’ concerns and to engage in dialogue with unaffiliated stockholders can also at times distract management’s time and attention from the effective operation and improvement of the business.

Management and Board of Directors of the Surviving Corporation

The board of directors of the surviving corporation will, from and after the effective time of the merger (which we refer to as the “ effective time ”), consist of the sole director of Merger Sub, Mr. Xianfu Zhu, until his successor has been duly elected or appointed and qualified or until his earlier death, resignation or removal. The officers of the Company will, from and after the effective time, be the officers of the surviving corporation until their successors have been duly appointed and qualified or until their earlier death, resignation or removal.

Background of the Merger

Our board of directors and senior management periodically review the Company’s long-term strategic plan with the goal of maximizing stockholder value. As part of this ongoing process, the board of directors and senior management also have periodically reviewed strategic alternatives that may be available to the Company, including potential joint ventures, acquisitions transactions and new business line.

During the second quarter of 2011, Mr. Xianfu Zhu, Chairman of the board of directors and Chief Executive Officer of the Company (the “ Chairman ”), was approached on separate occasions by two international private equity funds with respect to a potential going-private transaction involving the Company. The Chairman did not express an interest in participating in any such potential transaction with either private equity fund because (a) the Chairman had not had sufficient opportunity to study and analyze the process of a going-private transaction and its implications to the Company and (b) the Chairman believed that the benefits to the Company of having access to the international capital markets still outweighed the costs to the Company for remaining as a U.S. public company.

In July and August of 2011, shares of the Company experienced a significant increase in short selling activities followed by research reports published on the Internet alleging, among other things, that the Company's financial statements contained false and incomplete information and such financial statements materially differed from the Company's reported financial information submitted to PRC regulators. The Company categorically denied and vigorously defended against each and all of such allegations. The Chairman and other members of Company management spent a significant amount of time communicating with investors in response to those short selling activities.

During the second quarter and the third quarter of 2011, representatives of several investment banks separately approached the Chairman to introduce ideas with respect to a potential going-private transaction. In light of the volatility of the Company's share prices and the increase in short selling activity of the Company shares, the Chairman met with the representatives of the investment banks and listened to their high-level explanation of going-private transactions. In his meetings with the representatives of the investment banks, the Chairman also asked general questions with respect to the going private process and their experiences in going private transactions, but did not express any willingness to proceed with such a transaction.

The Chairman began to consider the feasibility of a going-private transaction involving the Company in late September 2011, and began to study and follow the developments of several going-private transactions involving similarly situated China-based issuers sponsored by their Chairmen and Chief Executive Officers.

Between September 2011 and March 2012, the Chairman continued to evaluate the pros and cons of a potential transaction. The Chairman also took into account the successful completion of several going-private transactions involving similarly situated China-based issuers in deciding whether to pursue the potential transaction. In March, 2012, the Chairman met with attorneys at Skadden, Arps, Slate, Meagher & Flom, LLP

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(“ Skadden ”) and discussed the going-private process and key issues and concerns that may arise in a potential transaction. Thereafter, the Chairman engaged Skadden as his legal counsel in connection with a potential transaction because of its extensive experience in mergers and acquisitions, particularly going-private transactions involving China-based companies. The Chairman, with the assistance of Skadden, developed and prepared his proposal to submit to the board of directors. On March 27, 2012, the board of directors held a special meeting, during which the Chairman delivered his preliminary, non-binding proposal letter (the “ Proposal Letter ”) to acquire all of the outstanding common stock of the Company not then owned by him, in a going private transaction for $13.50 per share, in cash, subject to certain conditions. In the Proposal Letter, the Chairman, among other things: (a) outlined his desire to work with the board of directors to bring the proposed transaction to a successful and timely conclusion; (b) stated his expectations that the transaction would be financed with a combination of debt and equity capital, including his existing holdings of Company common stock and that a potential transaction might involve the participation of certain other Company stockholders; and (c) indicated his understanding that only the independent members of the board of directors would consider the proposed transaction. The Chairman also stated in the Proposal Letter that he did not intend to sell his stake in the Company to any third party.

On March 27, 2012, the Company issued a press release regarding its receipt of the Proposal Letter, and furnished the press release as an exhibit to a Current Report on Form 8-K. The board of directors (with the Chairman recusing himself) determined that it was in the best interests of the Company to form a special committee, consisting of the board’s three independent directors, Mr. Raymond Leal (to serve as chairman of the special committee), Mr. Yaoguo Pan and Mr. Xiaosong Hu, to evaluate the Chairman’s proposal and other strategic alternatives for the Company. The board of directors established the special committee on March 28, 2012. The board of directors delegated full power and authority to the special committee in connection with its evaluation of the proposal from the Chairman, including full power and authority to: (a) review, evaluate and negotiate the terms of the proposal from the Chairman or any alternative transaction, including negotiating the definitive agreement or agreements; (b) advise the board of directors whether the proposal from the Chairman or any alternative transaction was advisable and fair to, and in the best interests of, the Company and its unaffiliated stockholders; and (c) reject or approve the proposal from the Chairman or any alternative transaction, or recommend rejection or approval of the proposal from the Chairman or any alternative transaction to the board of directors. The board of directors agreed that the proposed transaction or any alternative transaction would not be considered by the board of directors without a favorable recommendation by the special committee.

Thereafter, the special committee interviewed multiple law firms to serve as independent legal advisor. On April 13, 2012, the special committee retained Akin Gump Strauss Hauer & Feld LLP (“ Akin Gump ”) as its legal counsel and furnished a press release regarding such retention as an exhibit to a Current Report on Form 8-K. Akin Gump had not performed any work for the Chairman, his affiliates or the Company prior to its engagement by the special committee.

On April 18, 2012, at a meeting of the special committee, representatives of Akin Gump provided advice on the key issues and implications with respect to a going-private transaction, including the special committee’s evaluation of the fairness of the transaction to the Company’s unaffiliated stockholders and the directors’ fiduciary duties under Delaware law and advised the special committee to ensure that it engaged in a fair process free of undue influence from the Chairman and the Company’s management. At this meeting, the special committee and representatives of Akin Gump discussed a proposed confidentiality agreement between the Company and the Chairman and a form confidentiality agreement to be used in connection with the provision of confidential information to potential financing sources working with the Chairman. Representatives of Akin Gump also presented the special committee with a summary of Section 203 of the DGCL and the waiver requested by the Chairman from the special committee in order to allow the Chairman to enter into discussions with potential equity financing sources in connection with the proposed transaction. After discussion, the special committee approved the waiver of Section 203 of the DGCL requested by the Chairman, in consideration for the Chairman entering into a confidentiality agreement with the Company including a standstill provision prohibiting the Chairman from acquiring any stock of the Company or any material part of the assets of the Company, entering into any extraordinary transaction involving the Company, participating in any solicitation of proxies, calling a

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special meeting of the stockholders of the Company and entering into any discussions with any person in respect of the foregoing without the special committee’s prior written consent.

During the next several weeks, the special committee received proposals from multiple investment banking firms to act as independent financial advisor and the special committee interviewed several investment banking firms. On May 10, 2012, the special committee retained Barclays as its independent financial advisor. On May 10, 2012, the Company issued a press release stating that Barclays had been retained as financial advisor to the special committee to assist in the evaluation of the Chairman’s proposal and furnished the press release as an exhibit to a Current Report on Form 8-K. Barclays terminated its engagement as financial advisor to the special committee on November 23, 2012, prior to the special committee’s recommendation to the board of directors to adopt the merger agreement as described in more detail on page 84 below.

In May of 2012, representatives of the Chairman met with China Development Bank Corporation Hong Kong Branch (“ CDB ”) to discuss the possibility of CDB providing debt financing for the proposed transaction.

On May 11, 2012, the Chairman engaged Credit Suisse as his financial advisor in connection with the proposed transaction.

After the announcement of the Chairman’s proposal on March 27, 2012, several private equity firms, including ZT China Wealth Management Limited (“ ZT China Wealth ”), approached the Chairman and expressed their interest in becoming equity sponsors in the proposed transaction. In June of 2012, the Chairman met with ZT China Wealth and engaged in a preliminary discussion about the possibility of ZT China Wealth providing an equity investment in the proposed transaction. The Chairman was interested in partnering with ZT China Wealth because of its extensive experience in investments in China as well as its well-established business network in China.

Over the course of the summer of 2012, representatives of Barclays and Akin Gump contacted representatives of Credit Suisse and Skadden a number of times regarding the Chairman’s activities related to potential debt and equity financing for the transaction.

On June 26, 2012, the special committee held a meeting in Beijing with representatives of Akin Gump and Barclays where the parties discussed the status of the proposed transaction, possible next steps, the Company’s financial and capital market performance, as well as potential strategic alternatives available to the Company.

During the second half of June, 2012, management provided CDB with a full set of projections for the Company covering 2012 through to 2016 which were prepared by the Company and reviewed by the Chairman in connection with their preparation (the “ May Management Projections ”; please refer to page 65 for a summary of the May Management Projections). Company management prepared the projections in May 2012 for the purposes of facilitating discussions with CDB regarding debt financing and in response to Barclays’ request for financing projections. Management provided ZT China Wealth with the May Management Projections at the end of June.

In July of 2012, the Chairman met with CDB to address questions from CDB regarding the operations and business of the Company and discuss the key terms of a term loan facility to be provided by CDB (the “ CDB Loan ”).

On September 12, 2012, management provided Barclays with the May Management Projections. Barclays had received a high level summary of the projections which were consistent with the May Management Projections in August 2012.

On September 12, 2012, Credit Suisse, on behalf of the Chairman, sent to Barclays an initial draft of a merger agreement and a letter affirming the proposal contained in the Proposal Letter with preliminary details of the Chairman’s potential debt and equity financing (the “ Affirmation Letter ”).

On September 17, 2012, Barclays sent to Credit Suisse a set of questions requesting clarification regarding the Chairman’s potential debt and equity financing for the proposed transaction, including questions regarding the treatment of the Company’s existing debt, whether CDB and ZT China Wealth had completed due diligence, the expected timing for draft definitive documentation and whether additional members of the management team expected to rollover their shares in the proposed transaction. On September 18, 2012, Credit Suisse sent

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to Barclays written responses to these clarification questions, explaining that the buyer group did not contemplate any refinancing of the Company’s existing debt in its current financing plan, CDB had completed the due diligence necessary for its internal credit approval process, ZT China Wealth expected to complete its due diligence in a short time once access had been given, the buyer group expected to be in a position to execute the facility agreement and equity commitment letter with CDB and ZT China Wealth, respectively, at or prior to reaching agreement with the Company on the merger agreement and the individuals expected to rollover their shares would include, in addition to the Chairman, Mr. Baoke Ben, Mr. Chaoyang Liu, Mr. Qinghe Wang, Ms. Juan Juan Wang and Mr. Shuichi Si.

On September 19, 2012, the special committee held a telephonic meeting with representatives of Akin Gump and Barclays to discuss the Affirmation Letter and the key terms of the draft merger agreement. Representatives of Barclays summarized for the special committee the details of the potential debt and equity financing contained in the Affirmation Letter and in the written responses provided by Credit Suisse. Representatives of Akin Gump then led a discussion on the key terms in the draft merger agreement. In particular, the special committee and its advisors discussed adding a non-waivable “majority of the minority” voting requirement to provide additional protection to the Company’s unaffiliated stockholders, revising the provisions on each party's termination rights, the triggering events for termination fees and the “fiduciary out” protections contained in the draft agreement in order to better preserve the special committee's flexibility in auctioning the Company as well as increasing the certainty of the proposed transaction.

On September 21, 2012, Skadden received from White & Case LLP (“ White & Case ”), legal counsel to CDB, a preliminary draft of the facility agreement for the CDB Loan, which we refer to as the “ facility agreement ”.

On September 24, 2012, representatives of Barclays held a telephonic meeting with Company management to discuss and obtain more information regarding the May Management Projections.

On September 25, 2012, the Chairman's representatives, representatives of CDB, Skadden and White & Case met to discuss the key terms of the facility agreement, including, but not limited to, the term of the facility, the interest rate, repayment schedule, security package and drawdown conditions.

On September 27, 2012, Skadden circulated to White & Case the Chairman's comments to the facility agreement.

On September 28, 2012, the special committee held a telephonic meeting with representatives of Akin Gump and Barclays to discuss the proposed transaction. At this meeting, the special committee and its advisors discussed the potential advantages and disadvantages of conducting a pre-signing market check. After consideration of the process and timeframe, the special committee concluded that a market check should be conducted prior to the execution of any merger agreement. Additionally, the special committee discussed its desire to understand more about the financing for the proposed transaction and future plans for the Company’s business from the Chairman. The special committee instructed Barclays to arrange a meeting with the Chairman so that the Chairman could explain to the special committee his plans for the Company as well as provide the special committee with additional details regarding his financing plan for the proposed transaction.

On October 8, 2012, White & Case circulated to Skadden a revised draft of the facility agreement and the initial drafts of the ancillary documents and security documents in connection with the facility agreement.

On October 10, 2012, Skadden discussed with White & Case the various outstanding issues in the facility agreement and circulated to White & Case the Chairman's comments to the facility agreement and the ancillary documents in connection with the facility agreement.

On October 11, 2012, the special committee held a telephonic meeting with the Chairman and Mr. Baoke Ben, Executive Vice President and a director of the Company. Representatives of Akin Gump, Barclays, Skadden and Credit Suisse also attended the meeting. During the meeting, the Chairman explained to the special committee his perspective on the Company’s logistics business and confirmed to the special committee that he planned to obtain debt financing from CDB and equity financing possibly from ZT China Wealth. When asked about his intention with respect to the Company's logistics business, the Chairman confirmed that the buyer group intended to continue the logistics business because (i) it is part of the overall supply chain, (ii) there is a market need for the logistics business and (iii) the Chinese government encourages the development of this

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sector. The Chairman also updated the special committee on the status of his discussions with CDB and ZT China Wealth and provided to the special committee his estimate of the timing for definitive agreements with the proposed financing sources. At this meeting, the special committee inquired as to whether the Chairman would be interested in selling his shares to a third party bidder and in response the Chairman reaffirmed his position that, as a stockholder of the Company, he was not willing to sell his shares in the Company to any third party.

On October 12, 2012, Skadden sent to Akin Gump a draft of the facility agreement.

On October 14, 2012, Credit Suisse sent to Barclays a letter from the Chairman to the special committee outlining his progress in obtaining the equity and debt financing for the proposed transaction. With respect to the debt financing, CDB had informed the Chairman its credit committee had approved the provision of the debt financing for the proposed transaction and would be ready to sign the definitive agreements in connection with the debt financing on or prior to October 26, 2012. With respect to the equity financing, the Chairman and ZT China Wealth were close to reaching an agreement on the specific investment terms.

On October 16, 2012, Skadden sent to Akin Gump the drafts of the ancillary and security documents in connection with the CDB Loan.

On October 16, 2012, the special committee held a telephonic meeting with representatives of Akin Gump and Barclays. Representatives of Barclays informed the special committee that Credit Suisse had orally informed Barclays (i) that management had revised the May Management Projections and could provide the revised projections later that day and (ii) that the revised set of projections would reflect a decrease in the Company’s projected revenues, profits and gross margin. The special committee and its advisors also discussed requesting from Company management additional detail regarding the reasons for the revised projections that were expected to be received. Representatives of Barclays discussed with the special committee the next steps in beginning the market check and a preliminary timeline. The special committee instructed Akin Gump to send a revised draft of the merger agreement based on feedback discussed at the special committee meeting on September 19, 2012 to Skadden.

In the evening of October 16, 2012, Company management provided Barclays with a revised set of management projections of the Company (the “ October Management Projections ”) which were reviewed by the Chairman in connection with their preparation. The May Management Projections and October Management Projections differed in several respects, with the October Management Projections being based upon the Company’s preliminary third quarter financial reports, which reflected reductions in the Company’s revenue and profits as compared to the May Management Projections. Barclays prepared a summary comparison of the May Management Projections and October Management Projections. Later that night, the special committee, representatives of Barclays and Akin Gump held a telephonic meeting with Mr. Feng Wang, the Company’s Chief Financial Officer, to discuss and obtain more information regarding the October Management Projections, the Company’s preliminary third quarter results and the state of the Company’s business. Representatives of Barclays, on behalf of the special committee, led a discussion regarding these topics and asked Mr. Wang to explain the key drivers and rationale behind the revision of the management projections, the process of revising the management projections, the assumptions underlying the October Management Projections and expectations of management regarding the Company’s business.

Also on October 16, 2012, Akin Gump provided a revised draft of the merger agreement to Skadden reflecting the special committee’s position by adding, among other things: (i) a non-waivable “majority of the minority” voting requirement; (ii) a 60-day go-shop provision to allow the Company to continue to actively solicit proposals from third parties after entering into a merger agreement with the Chairman; (iii) a lower termination fee payable by the Company if it were to enter into an agreement in respect of an alternative transaction proposal received during the go-shop period; (iv) additional termination rights for the Company in certain circumstances; and (v) a specific performance remedy for the Company to compel the Chairman to consummate the transaction if all conditions to closing were satisfied or waived.

On October 17, 2012, White & Case sent to Skadden further revised drafts of the facility agreement and security documents for the CDB Loan.

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On October 19, 2012, Barclays launched the market check process. Per the special committee’s instruction, the deadline set forth in the bid invitation letter for preliminary proposals was November 9, 2012.

On October 19, 2012, the special committee held a telephonic meeting with Mr. Baoke Ben and Mr. Feng Wang, both of whom had been involved in the preparation of the May Management Projections and the October Management Projections, to further discuss and obtain more information regarding the October Management Projections. During the meeting, the special committee instructed Barclays to ask Company management to explain the key drivers and rationale behind the revision of the management projections, the process of revising the management projections, the assumptions underlying the October Management Projections and expectations of management regarding the Company’s business. At this meeting, representatives of Company management explained to the special committee and its advisors that, based on preliminary results, the Company’s third quarter results were going to be below the estimates included in the May Management Projections. According to management, the drivers of the lower third quarter results were the worsening macroeconomic conditions in China and intense competitive pressures in the industry due to consolidation. Management also noted rising operating costs and declining pork and hog prices. Company management further explained that after the end of the third quarter they had re-evaluated their expectations for the business on a going forward basis taking into account these trends and determined that it was necessary to adjust the May Management Projections to reflect their updated view with respect to the business. Company management confirmed that the October Management Projections were also provided to CDB.

Also on October 19, 2012, the special committee sent an email to the Chairman requesting, among other things, that the Chairman (i) not agree to any exclusivity arrangement with any potential investors, including ZT China Wealth, (ii) be open to and discuss the possibility of partnering with potential strategic and/or financial parties, (iii) actively engage in discussions and negotiations with such potential investors and (iv) allow Barclays to coordinate and facilitate discussions between the Chairman and all potential investors.

On the same day, Skadden, on behalf of the Chairman, responded to the special committee's email and confirmed that (i) the Chairman had not yet reached any agreement with ZT China Wealth and would not agree to any exclusivity arrangement with any potential investor, (ii) the Chairman agreed to be open to discussions with legitimate and serious potential investors who were not using the opportunity to gain competitive information from the Company, while reserving his rights and discretion, as a buyer, to discuss and negotiate the terms of investments with potential investors of his choosing and (iii) the Chairman agreed to engage in discussions with potential investors arranged and coordinated by Barclays.

On October 22, 2012, Skadden circulated to Akin Gump a revised draft of the merger agreement which proposed, among other things, (i) a majority of outstanding shares voting requirement without a majority of the minority approval condition; (ii) the deletion of the 60-day go-shop provision requested by the special committee; and (iii) the deletion of the specific performance remedy for the Company.

On the same day, Skadden, on behalf of the Chairman, made a request to Akin Gump for the special committee to grant to ZT China Wealth a limited waiver to the application of Section 203 of the DGCL (the “ 203 Waiver ”) allowing the Chairman to form a group with ZT China Wealth in connection with the proposed transaction.

Later that day, the special committee held a telephonic meeting with representatives of Barclays and Akin Gump to consider the October Management Projections. The special committee and its advisors discussed the differences between the May Management Projections and the October Management Projections, the reasons behind the differences as explained by Company management and certain supporting materials that had been provided by Company management. After further questions and discussion, the members of the special committee agreed that the October Management Projections would be used by Barclays for valuation analysis and provided to interested parties as part of the market check process. Representatives of Akin Gump discussed with members of the special committee the 203 Waiver requested by the Chairman for ZT China Wealth and noted that a confidentiality and standstill agreement had been entered into by the Company and ZT China Wealth. After discussion, the special committee approved the granting of the 203 Waiver to ZT China Wealth.

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On October 26, 2012, representatives of Skadden circulated drafts of the voting agreement, contribution agreement, equity commitment letter and limited guaranty to representatives of Akin Gump.

On October 30, 2012, a telephonic meeting of the special committee was held with representatives of Akin Gump and Barclays. Representatives of Barclays summarized the status of the market check process and informed the special committee that two potential strategic buyers and 17 potential financial buyers had received bid invitation letters, and discussed next steps with the special committee. Representatives of Akin Gump discussed with the members of the special committee the key terms of the draft merger agreement received from Skadden on October 22, 2012 and the proposed response by the special committee to those terms, including the non-waivable majority of the minority voting approval required to approve the merger, the terms of the go-shop provision and a specific performance remedy for the Company. The special committee instructed Akin Gump to provide Skadden with a revised draft merger agreement which, among other things, reinstated the non-waivable “majority of minority” voting requirement, the go-shop clause and the specific performance remedy for the Company and provided for higher termination fees.

Later in the day on October 30, 2012, representatives of Akin Gump and Skadden held a telephonic meeting to discuss the merger agreement. During this meeting, the legal advisors discussed, among others (i) the go-shop clause; (ii) termination fees; (iii) the non-waivable majority of the minority approval condition; and (iv) the specific performance remedy for the Company.

On November 1, 2012, Akin Gump circulated to Skadden a revised draft of the merger agreement reflecting the special committee’s positions and the negotiations that had taken place on October 30, 2012, including, among other things, (i) a non-waivable “majority of the minority” voting requirement; (ii) the Company’s ability to terminate the merger agreement to accept a superior proposal without being obligated to pay a termination fee if such termination took place during the first 15 days of the go-shop period; (iii) a specific performance remedy for the Company such that the Company would be able to require Parent and Merger Sub to send a drawdown notice to CDB if all the conditions in the merger agreement have been satisfied; and (iv) 2% of equity value and 5% of equity value as the amounts for the Company and Parent termination fees.

On November 2, 2012 a telephonic meeting of the special committee was held with representatives of Akin Gump and Barclays. Representatives of Barclays summarized for the special committee members the financial covenants in the draft facility agreement. Representatives of Barclays then presented their preliminary valuation analysis to the special committee which used valuation methodologies such as historical trading range, brokers’ price targets, trading comparables, discounted cash flow based on October Management Projections, transaction comparables and historical takeover premia. The preliminary valuation analysis indicated that the per share merger consideration of $13.50 fell within the hypothetical equity value per share range derived based on the various valuation methodologies, but Barclays did not present any conclusion regarding the fairness of the proposed per share merger consideration. Barclays subsequently on November 23, 2012 notified the special committee that no written or oral advice, analyses, presentations, summaries or findings previously provided by Barclays to the special committee shall be relied upon in connection with any evaluation or decisions to be made by any of the special committee, the board of directors or the stockholders of the Company when Barclays terminated its engagement as financial advisor to the special committee. After discussion, representatives of Barclays advised the special committee to ask the Chairman for a price increase. The special committee agreed with this recommendation and instructed Barclays to convey the special committee’s position to the Chairman for an increase in the per share merger consideration. Representatives of Barclays provided an update on the market check process, including, among other things, that no indicative bids had been received. Representatives of Akin Gump summarized the discussions between Skadden and Akin Gump on the remaining open issues in the draft merger agreement and after discussion on these issues, the special committee instructed Akin Gump to continue to insist on the non-waivable majority of the minority voting requirement and a 60-day go-shop period.

On November 2, 2012, Skadden sent to Akin Gump a revised draft of the merger agreement which proposed, among other things, (i) deleting the majority of the minority voting requirement; (ii) a 45-day go-shop period; (iii) accepting the specific performance remedy requested by the special committee; and (iv) $3 million and $6 million for the Company and Parent termination fees, with a Company termination fee of $1.5 million if the

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merger agreement was terminated by the Company to enter into an agreement for an alternative transaction proposal received on or after the 16 ^th day of the go-shop period up until the end of the go-shop period.

On November 4, 2012, Akin Gump sent to Skadden a further revised draft of the merger agreement which proposed, among other things, (i) re-inserting the non-waivable majority of the minority voting requirement; (ii) a 60-day go-shop period; and (iii) a covenant from the Chairman to enter into good faith discussions and negotiations regarding his participation in an alternative transaction proposal from third parties after any execution of a merger agreement.

During the week of November 4, 2012, representatives of Akin Gump and Skadden held several conference calls to discuss outstanding issues in the merger agreement. Skadden and White & Case also held multiple meetings to discuss and finalize the agreements in connection with the CDB Loan.

Also during the week of November 4, 2012, representatives of Barclays and Credit Suisse held multiple conference calls to discuss the possibility for an increase in the offer price from the Chairman. During these discussions and throughout the price negotiations, the special committee, via Barclays, did not request that the Chairman’s offer price be increased by a specific amount.

On November 6, 2012, Skadden sent to Akin Gump a further revised draft of the merger agreement and informed Akin Gump by phone that the Chairman was willing to accept the non-waivable majority of the minority voting requirement, the 60-day go-shop period and an increase in the amount of the reverse termination fee payable by the Parent in the event that the proposed transaction did not close in certain circumstances, subject to the special committee accepting the offer price of $13.50 per share.

On November 6, 2012, the special committee held a telephonic meeting with representatives of Akin Gump and Barclays. Representatives of Barclays provided an update on the market check process and informed the special committee that it had reached out to a total of 17 private equity firms and 5 strategic investors and confidentiality agreements had been executed with five potential interested parties. Representatives of Barclays also informed the special committee that it had had several discussions with Credit Suisse in an effort to induce a higher offer price from the Chairman, but the Chairman continued to believe that the offer price at $13.50 per share represented an attractive offer to the stockholders of the Company and had stated that he was not willing to increase the offer price. Representatives of Akin Gump summarized the phone call with Skadden earlier in the evening and the Chairman’s offer to accept the special committee’s position on the outstanding legal issues in the merger agreement if the special committee accepted the Chairman’s proposed price. After discussion, the special committee instructed Barclays to continue to negotiate with the Chairman for a price increase.

On November 7, 2012, Barclays had discussions Credit Suisse and the Chairman and requested that the Chairman increase his offer price. The Chairman indicated to Barclays that he was convinced, based on his understanding of the business and operation of the Company, that his offer price represented a highly attractive alternative to the stockholders of the Company and that he was not willing to increase the offer price.

On November 8, 2012 the Company publicly released its third quarter results for 2012. The results of the third quarter were below the May Management Projections and in line with the October Management Projections.

On November 8, 2012, the special committee held a telephonic meeting with representatives of Akin Gump and Barclays. Representatives of Barclays summarized its discussions with the Chairman on November 7, 2012 regarding the offer price. After the discussion, the special committee instructed Barclays to continue negotiations with Credit Suisse on the offer price. Representatives of Barclays also updated the special committee with respect to the progress on the market check process and the possibility of Company A, which had signed a confidentiality agreement and received the October Management Projections on the Company, making a proposal, but that it was likely to be submitted after November 9, 2012, the deadline for the submission of proposals set by the special committee.

On November 12, 2012, Akin Gump circulated a revised draft of the merger agreement to Skadden which re-inserted the non-waivable majority of the minority voting approval, increased the amount of the reverse

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termination fee payable by Parent and proposed a revised covenant from the Chairman to enter into good faith discussions and negotiations regarding his participation in an alternative transaction proposal.

On the morning of November 15, 2012, a meeting between the financial and legal advisors of the special committee and the Chairman and his advisors was held to discuss the open issues in the transaction documents and the offer price. At the meeting, the parties discussed the amount of the termination fee and the reverse termination fee as well as the reduced termination fee during the go-shop period, the proposed covenant from the Chairman to enter into good faith discussions and negotiations regarding his participation in an alternative transaction proposal, the terms of the limited guaranty with respect to the payment of the reverse termination fee and the offer price of $13.50 per share. On November 15, 2012, Barclays and Akin Gump telephoned Credit Suisse and Skadden, respectively, to request additional diligence information regarding ZT China Wealth and its ability to provide the equity financing.

On the evening of November 15, 2012, Barclays received a non-binding proposal from Company A, offering to acquire all the outstanding stock of the Company not owned by the Chairman at $15.00 per share, giving Company A a majority stake in the Company (“ Proposal A ”). Proposal A was subject to due diligence, regulatory approval, the Chairman’s participation as a rollover stockholder and the Chairman’s agreement to continue as Chairman and Chief Executive Officer of the Company after closing of the transaction.

On November 16, 2012, the special committee convened a telephonic meeting which was attended by representatives of Akin Gump and Barclays. At this meeting, the special committee and its advisors assessed the terms of Proposal A and discussed its conditions, including the regulatory approvals necessary to complete the transaction, the required agreement by the Chairman to continue as Chairman and Chief Executive Officer of the Company, the Chairman rolling over his current equity ownership in the Company and that Company A would have a majority ownership in the Company post transaction. It was noted that no other proposals had been received as a result of the market check process by the deadline of November 9, 2012. Representatives of Barclays and Akin Gump also updated the special committee on the meeting with the Chairman and his advisors on November 15, 2012. Representatives of Barclays informed the special committee that the Chairman had indicated that $13.50 per share represented his “best and final” offer and what he believed to be a highly attractive alternative to the stockholders of the Company. After discussion, the special committee instructed Barclays to contact Company A in order to arrange a conference call between Company A, the special committee’s advisors, the Chairman and his advisors. The special committee also instructed Barclays to inform the Chairman that a bid proposal had been received from Company A and request his cooperation with Company A in its bid.

On November 17, 2012, a telephonic meeting was held between the Chief Executive Officer and the general counsel of Company A and the Chairman, which was also attended by representatives of Akin Gump, Barclays, Skadden and Credit Suisse. At this meeting, the Chief Executive Officer and general counsel of Company A outlined the terms of Proposal A, including the requirement for the continued participation of the Chairman with the Company after the consummation of the transactions contemplated under Proposal A. After discussion, the Chairman informed Company A and the special committee’s advisors that he was not interested in continuing as Chief Executive Officer of the Company if the majority ownership in the Company was sold to Company A. The Chairman also stated that, in his capacity as a stockholder of the Company, he was not willing to roll over his current equity ownership in the Company in connection with Proposal A, noting that he did not need Company A for his financing as his proposal already had adequate financing to consummate the proposed transaction. The Chairman indicated that, at the request of the special committee, he would continue to cooperate in further discussions with Company A and any other alternative bidder in his capacity as an officer and director of the Company.

Later on the same day, the Chairman delivered a letter to the special committee in which he stated that sufficient debt and equity financing had been secured from CDB and ZT China Wealth, respectively, both of whom were prepared to execute definitive financing documents. The letter stated the Chairman’s position that he continued to believe the offer price at $13.50 per share represented an extremely attractive opportunity for the stockholders of the Company and was the highest price he was willing and able to offer. The letter also informed the special committee that the Chairman would seriously consider withdrawing his proposal unless the special committee indicated to him, by midnight on November 21, 2012 whether it intended to approve

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the proposed transaction and recommend the merger agreement and the proposed transaction to the board of directors. Further, the Chairman stated that he was not interested in engaging in discussions with any other person, in his capacity as a stockholder of the Company, regarding its participation in financing the proposed transaction because the financing required to consummate the proposed transaction had already been secured.

On November 18, 2012, the special committee held a telephonic meeting with representatives of Akin Gump and Barclays. Representatives of Barclays summarized the telephonic meeting on November 17, 2012 between Company A and the Chairman and informed the special committee of the Chairman’s position regarding Proposal A. The special committee and its advisors then discussed the letter received from the Chairman on November 17, 2012, and the status of the proposed transaction, including: (i) the existence of Proposal A, notwithstanding the fact that the Chairman, in his capacity as a stockholder of the Company, refused to partner with Company A; and (ii) the Chairman’s refusal to increase the offer price. Representatives of Barclays then informed the special committee that Barclays was not prepared to render an opinion on the fairness of the consideration offered by the Chairman at that time. Further, the special committee and its advisors also discussed other aspects of the proposed transaction, including the downward revision of the management projections during the special committee process and the limited nature of diligence information that had been provided regarding ZT China Wealth, in particular relating to its ability to fund the equity commitment. After discussion with its advisors on next steps, the special committee instructed Barclays to continue to negotiate with the Chairman on the offer price and ask Company A whether it would be willing to complete a transaction without the Chairman remaining as Chief Executive Officer and a minority stockholder of the Company. After discussion with its advisors, the special committee decided that it needed more time to conduct the process and complete its assessment of the proposed transaction and instructed Akin Gump to inform Skadden that the special committee would not reach a position regarding the Chairman’s offer prior to the November 21 deadline.

During the week of November 19, 2012, legal advisors to the Company, the Chairman and the special committee exchanged drafts of the merger agreement and had various telephone conversations in order to finalize the legal terms of the merger agreement and the other transaction documents. During the same week, the Chairman’s advisors provided the special committee and its advisors with additional background information relating to ZT China Wealth as well as the finalized facility agreement to be entered into by Parent and CDB. Also during this week, representatives of Barclays telephoned Company A to determine whether it would be willing to consummate a transaction without the cooperation of the Chairman. Company A informed representatives of Barclays that it might consider a transaction without the cooperation of the Chairman if all other members of the Company’s management agreed to remain in place, subject to due diligence on the management team members and that it would not consider a transaction where it acquired a minority stake in the Company.

On November 19, 2012, Barclays and Credit Suisse held discussions with respect to valuation and as a result of these discussions Barclays believed that Credit Suisse, on behalf of the Chairman, signaled that there may be price flexibility of an increase of 25 cents in the offer price to $13.75, although Credit Suisse denies that it indicated that the Chairman was willing to increase the offer price. On the same day, representatives of Barclays informed representatives of Akin Gump that it believed there was potential flexibility with respect to a price increase.

On November 21, 2012, Skadden, on behalf of the Chairman, informed Akin Gump that the Chairman was told that there was a possibility that CDB would withdraw its commitment to provide debt financing for the proposed transaction if there continued to be delays in signing the merger agreement while CDB had been standing ready to sign the financing documents in connection with the CDB Loan. Skadden further told Akin Gump that, in the event of withdrawal by CDB of its commitment to provide the CDB Loan, the Chairman would not have the financing necessary to consummate the proposed transaction and would likely be left with no choice but to withdraw his proposal.

On the morning of November 22, 2012, the special committee held a telephonic meeting with representatives of Akin Gump. At this meeting, the special committee and representatives of Akin Gump discussed, among other things, the additional information provided by the Chairman regarding ZT China Wealth and the status of the Chairman’s proposed debt financing. Representatives of Akin Gump informed the special committee of

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its discussion with Skadden with respect to the possible withdrawal of CDB in connection with the proposed debt financing, which would likely result in the Chairman's withdrawal of his proposal. Representatives of Akin Gump explained to the special committee that according to Skadden, the debt financing could be protected if the special committee agreed to conclude and enter into the merger agreement with the Chairman quickly, the Chairman would agree then to the inclusion of an additional right in the merger agreement to terminate the merger agreement in the sole discretion of the Company, acting at the direction of the special committee on or prior to January 25, 2013 without adverse consequence for any party, including no termination fee payable by either the Company or the Chairman. Additionally, the special committee and representatives of Akin Gump discussed the fact that the merger agreement would permit the special committee to continue to negotiate with Company A after signing and that if the special committee ultimately reached a deal with Company A that the special committee desired to accept, that the special committee could terminate the merger agreement with no termination fee being payable by the Company to the Chairman. After a considerable amount of discussion regarding the conditions attached to Proposal A which could not be satisfied as a result of the Chairman’s lack of interest in joining Company A in connection with Proposal A, the status of the debt financing for the proposed transaction by the Chairman, the terms of the go-shop provision in the merger agreement, and the substantial work that the special committee had undertaken in connection with the proposed transaction thus far, the special committee decided that it would ask Barclays whether it was prepared to deliver an opinion as to the fairness of the consideration offered by the Chairman.

From November 19 to November 22, 2012, ongoing discussions took place between representatives of Credit Suisse and Barclays, during the course of which representatives of Barclays indicated to representatives of Credit Suisse that Barclays would not be in a position to provide a fairness opinion at a share price of $13.50. With that in mind, and based on continued discussions with representatives of Credit Suisse, representatives of Barclays concluded that the Chairman was offering a per share price of $13.75 in the interest of a speedy conclusion of the transaction. Credit Suisse denies that it indicated that the Chairman was willing to increase the offer price. In the afternoon of November 22, 2012, representatives of Barclays informed representatives of Akin Gump that they believed that a price of $13.75 per share had been offered by Credit Suisse on behalf of the Chairman.

Later on November 22, 2012, Akin Gump contacted Skadden to confirm the increase in the offer price by the Chairman.

On the evening of November 22, 2012, the chairman of the special committee held a telephonic meeting with representatives of Barclays. During that meeting, Barclays informed the chairman of the special committee that Credit Suisse had signaled to Barclays that the Chairman was prepared to raise his offer price by 25 cents to $13.75 per share in the interest of getting the deal done. The chairman of the special committee asked if Barclays would be prepared to issue a fairness opinion with respect to the Chairman’s per share offer price and Barclays advised the chairman of the special committee that given the existing circumstances regarding the going-private transaction discussed by the special committee and its advisors at the November 18, 2012 meeting described above, it was not in a position to render an opinion as to the fairness, from a financial point of view, of the Chairman’s purported $13.75 per share offer.

On the morning of November 23, 2012, Skadden, on behalf of the Chairman, contacted Akin Gump and informed them that there would be no price increase. Skadden further clarified that according to Credit Suisse, Credit Suisse’s discussion with Barclays was purely theoretical and hypothetical and was not meant to be construed as, an offer or agreement by the Chairman to increase his offer price and reiterated that $13.50 continued to be the Chairman’s best and final offer.

On the same morning, the special committee held a telephonic meeting. Shortly after the beginning of this meeting, Barclays sent a letter to the special committee terminating its engagement as financial advisor to the special committee stating that it was “not in a position to render an opinion on [the Chairman’s] revised proposal of $13.75 per share” and notifying the special committee that no written or oral advice, analyses, presentations, summaries or findings previously provided by Barclays to the special committee shall be relied upon in connection with any evaluation or decisions to be made by any of the special committee, the board of directors or the stockholders of the Company. Following receipt of the letter, the special committee then discussed with representatives of Akin Gump how to proceed with respect to the proposed transaction in light

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of the termination by Barclays of its engagement and the potential withdrawal of the debt financing by CDB. Representatives of Akin Gump also explained to the special committee that the Chairman’s advisors had informed Akin Gump that various conversations had taken place between Barclays and Credit Suisse but that Skadden, on behalf of the Chairman, had indicated that the Chairman had not authorized any increase in the offer price and the offer price of $13.50 per share had not changed. The special committee discussed the possibility and the process of arranging for another independent financial advisor to consider the fairness, from a financial point of view, of the offer price by the Chairman, and to render its opinion thereon following the execution of the merger agreement. The special committee then discussed and assessed the alternatives that were available to the special committee and paid particular attention to the fact that any further delay in the merger agreement negotiation could risk losing the proposed debt financing from CDB and that, if the debt financing became unavailable, the Chairman would likely withdraw his proposal. After taking into consideration the measures that the special committee had adopted thus far to ensure a fair, open and responsive process, including conducting a market check and repeatedly engaging in price negotiations with the Chairman as well as extensive and robust negotiations on other key terms of the merger agreement, and taking into account the special committee’s view that remaining as a stand-alone company was less favorable to the Company’s stockholders than the merger, the members of the special committee determined that, based on their financial and industry experience and acumen and the information they had considered during the course of the special committee’s assessment process, including the fact that the offer price represented a premium of approximately 47% over the closing price on March 26, 2012, the last trading day prior to the Company’s announcement on March 27, 2012 of its receipt of the proposal from the Chairman, the recent performance of the Company including the Company’s third quarter results which reflected a more challenging business environment for the Company and the information contained in the preliminary valuation analysis provided by Barclays on November 2, 2012 which was prepared prior to the receipt of Proposal A, they were individually and collectively prepared to conclude that the offer was fair and in the best interest of the Company’s unaffiliated stockholders. In addition, the special committee was mindful that the Company, at the direction of the special committee, could unilaterally terminate the merger agreement on or prior to January 25, 2013. The special committee discussed the fact that by entering into the merger agreement, the Company and the special committee would secure the proposed transaction while preserving their flexibility until January 25, 2013 to further consider all circumstances with respect to the merger agreement and the proposed transaction, including, among other things, whether the special committee could engage other independent financial advisors to consider the fairness from a financial point of view of the merger consideration at $13.50 per share and that pursuant to the terms of the merger agreement, the special committee was permitted to continue to engage in discussions with Company A regarding its proposal and ultimately terminate the merger agreement without penalty to the Company if an agreement could be reached with Company A. Representatives of Akin Gump reminded the members of the special committee of their fiduciary duties under Delaware law and after considering the proposed terms of the merger agreement and the other transaction agreements and the numerous prior discussions with its advisors, and taking into account the other factors described below under the headings titled “ Special Factors relating to the Merger — Purposes and Reasons of Our Board of Directors and the Special Committee for the Merger ”, the special committee then unanimously determined that the merger agreement and the merger and other transactions contemplated by the merger agreement were advisable and fair to and in the best interests of the Company and its unaffiliated stockholders, and recommended that the board of directors adopt a resolution approving and declaring the advisability of the merger agreement and the merger and the other transactions contemplated by the merger agreement and recommending that the stockholders of the Company adopt the merger agreement.

Following the special committee’s approval, the board of directors, by way of a unanimous written consent of the directors dated November 23, 2012, approved and declared advisable the merger agreement, the merger and the other transactions contemplated by the merger agreement and recommended that the stockholders of the Company adopt the merger agreement.

The merger agreement and other transaction agreements were executed on November 26, 2012. Prior to the opening of the U.S. financial markets on November 26, 2012, the Company issued a press release announcing the execution of the merger agreement and furnished the press release and the merger agreement as exhibits to its Current Report on Form 8-K on the same date.

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After the execution of the merger agreement on November 26, 2012, the special committee and representatives of Akin Gump interviewed multiple investment banking firms to act as an independent financial advisor to the special committee and to manage the go-shop process. After careful consideration of the reputation and experience of the various investment banking firms, on December 10, 2012 the special committee retained Cowen and Duff & Phelps as joint independent financial advisors to the special committee. The special committee’s decision to engage Cowen and Duff & Phelps after approving the original merger agreement was based on the following key considerations: (i) while the members of the special committee, based on their financial and industry experience, knowledge and ability and the information considered in the course of the transaction process, were comfortable approving the terms of the proposed merger without a fairness opinion, they nonetheless considered it prudent and beneficial to the Company’s unaffiliated stockholders to engage Cowen and Duff & Phelps, given their experience in performing fairness analysis in similar transactions, to each deliver a fairness opinion with respect to the proposed merger; and (ii) the special committee desired to effectively manage the go-shop process and negotiate with any potential strategic or financial bidders that may emerge during and following the go-shop process and considered it advisable to engage financial advisors in connection with such activities.

On December 24, 2012, Cowen and Duff & Phelps launched the go-shop process, contacting potential financial and strategic investors.

On January 12, 2013, representatives of Duff & Phelps and Cowen held a telephonic meeting with the general counsel of Company A. During this call, Company A indicated that it would not be interested in pursuing any transaction that was not supported by the Company’s management team, including the Chairman. Further, Company A stated that it may not be interested in a transaction involving the Company even if the Chairman changed his position and agreed to partner with Company A.

On January 14, 2013, the Company, Parent, Merger Sub and the Chairman entered into Amendment No. 1 to the merger agreement which (i) extended the go-shop period under the merger agreement until February 8, 2013; and (ii) extended the date on or prior to which the merger agreement could be terminated by the Company (at the direction of the special committee) at any time for any reason until February 8, 2013 (the “ Amendment ”). Prior to the opening of the U.S. financial markets on January 14, 2013, the Company filed the Amendment as an exhibit to its Current Report on Form 8-K on the same date.

During the week of January 21, 2013, representatives of Cowen and Duff & Phelps had discussions with representatives of Credit Suisse to request that the Chairman increase the offer price under the merger agreement. Representatives of Credit Suisse told representatives of Cowen that the financing package did not leave any room for a price increase but they would discuss with the Chairman.

On January 22, 2013, management of the Company provided Cowen and Duff & Phelps with preliminary estimated unaudited summary financial results for the fourth quarter of the fiscal year ending December 31, 2012, and on February 1, 2013, Cowen requested and received from management certain supplemental information for the same period (together the “ Updated 2012 Estimates ”).

On January 25, 2013, the special committee held a telephonic meeting which was attended by representatives of Akin Gump, Cowen and Duff & Phelps. Representatives of Cowen and Duff & Phelps provided a summary of the go-shop process to the special committee and explained that Cowen had contacted the private equity firms while Duff & Phelps had contacted the strategic investors. Representatives of Cowen had contacted a total of 55 private equity firms to solicit interest in a possible alternative transaction, of which 35 responded that they were not interested and 20 did not respond. Representatives of Duff & Phelps explained to the special committee that it had contacted a total of 28 strategic investors, all of whom were not interested in making a bid. Representatives of Duff & Phelps also summarized the conversation with the general counsel of Company A on January 12, 2012. Despite these solicitation efforts, none of the parties contacted had executed a confidentiality agreement with the Company and no proposals had been received by the bid deadline of January 25, 2013. Representatives of Cowen and Duff & Phelps informed the special committee of their conversations with representatives of Credit Suisse earlier in the week in relation to the offer price.

On January 30, 2013, representatives of Akin Gump contacted representatives of Skadden to inquire whether the Chairman was willing to work with Company A or any other partner with respect to an alternative

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transaction. On February 1, 2013, representatives of Cowen and Duff & Phelps held a telephonic meeting with the Chairman and Mr. Baoke Ben and requested a price increase. The Chairman told representatives of Cowen and Duff & Phelps that he was not willing to increase the offer price.

During the week of February 4, 2013, representatives of Akin Gump and Skadden had telephone conversations to discuss amending and restating the merger agreement. In addition to discussing the deletion of the go-shop provision and the Company’s right to terminate the original merger agreement at any time for any reason, representatives of Akin Gump requested an increase in the reverse termination fee payable by Parent, increased specific performance rights for the Company and a reduction in the termination fee payable by the Company. After discussions with the Chairman, Skadden informed representatives of Akin Gump that the Chairman was not willing to change the specific performance rights or the amount of the reverse termination fee under the merger agreement, but would agree to revise the amount of the Company termination fee from $5,000,000 to $4,750,000. Representatives of Akin Gump and Skadden exchanged drafts of the amended and restated merger agreement in order to implement this change, along with the removal of the go-shop provision and the Company’s right to terminate the merger agreement at any time for any reason.

On February 7, 2013, representatives of Skadden confirmed to representatives of Akin Gump that the Chairman was not willing to work with Company A or any other partner in his capacity as a stockholder of the Company.

On February 8, 2013, the special committee held a telephonic meeting, at which representatives of Akin Gump and Cowen attended, to consider approving a revised merger agreement reflecting the terms discussed between representatives of Akin Gump and Skadden. Representatives of Akin Gump again provided a summary of the directors’ fiduciary duties under Delaware law. Representatives of Cowen discussed its financial analysis in connection with issuing a fairness opinion, reviewed the terms of the transaction and discussed the Company’s financial performance and its historical stock price. Representatives of Cowen then provided a summary of the various financial analyses it had performed, including selected comparable public companies analysis, selected precedent transactions analysis, selected premiums paid analysis, discounted cash flow analysis and illustrative leveraged buyout analysis. Representatives of Cowen then verbally rendered their opinion to the special committee, which was confirmed in writing by delivery of its written opinion dated the same date, that Cowen considered the per share merger consideration to be fair, from a financial point of view, to the holders of the Company common stock (other than Parent, Merger Sub and their affiliates, the Rollover Investors and stockholders who have exercised, perfected and not withdrawn a demand for, or lost the right to, appraisal rights under the DGCL). The full text of the opinion delivered by Cowen on February 8, 2013 is attached as Annex B to this proxy statement. Representatives of Cowen left the telephonic meeting and representatives of Duff & Phelps joined the telephonic meeting.

Representatives of Duff & Phelps then provided a summary of the various financial analyses it had performed, including premiums paid analysis, selected comparable public companies/M&A transactions analysis and discounted cash flow analysis. Representatives of Duff & Phelps then verbally rendered their opinion to the special committee, which was confirmed in writing by delivery of its written opinion dated the same date, that Duff & Phelps considered the per share merger consideration to be fair, from a financial point of view, to the holders of the Company common stock (other than Parent, Merger Sub and their affiliates, the Rollover Investors and stockholders who have exercised, perfected and not withdrawn a demand for, or lost the right to, appraisal rights under the DGCL) in connection with the transaction. The full text of the opinion delivered by Duff & Phelps on February 8, 2013 is attached as Annex C to this proxy statement. Representatives of Duff & Phelps then left the telephonic meeting.

Representatives of Akin Gump then provided the special committee with a summary of the amended and restated merger agreement and explained the differences between the merger agreement dated as of November 26, 2012 and the merger agreement under consideration, including the deletion of the go-shop provision, the deletion of the Company’s right to terminate the merger agreement at any time for any reason whatsoever on or prior to February 8, 2013 and the decrease in the amount of the termination fee payable by the Company in specified circumstances. After due consideration of the presentations made by Cowen and Duff & Phelps, discussions with representatives of Akin Gump, Cowen and Duff & Phelps, the results of the go-shop process, the receipt of the fairness opinions from each of Cowen and Duff & Phelps and having

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deemed the terms thereof to be fair to and in the best interest of the Company’s stockholders, the members of the special committee unanimously approved the terms of the amended and restated merger agreement and the transactions contemplated therein.

Following the meeting of the special committee, based upon the unanimous approval of the special committee, the board of directors by way of a unanimous written consent approved the terms of the merger agreement and the transactions contemplated thereby, and recommended that the Company’s stockholders vote to adopt the merger agreement. See “ Special Factors Relating to the Merger — Recommendation of Our Board of Directors and Special Committee; Reasons for Recommending the Adoption of the Merger Agreement; Fairness of the Merger ” below for a description of the resolutions of our board of directors at this meeting.

The amended and restated merger agreement was executed on February 8, 2013. Prior to the opening of the U.S. financial markets on February 8, 2013, the Company issued a press release announcing the execution of the amended and restated merger agreement and filed the press release and the amended and restated merger agreement as exhibits to its Current Report on Form 8-K on the same date.

Recommendation of Our Board of Directors and Special Committee; Reasons for Recommending the Adoption of the Merger Agreement; Fairness of the Merger

The Board determined that it was advisable and in the best interests of the Company and its stockholders to form the special committee consisting only of independent directors for the purpose of evaluating the preliminary non-binding proposal received from Mr. Xianfu Zhu on March 27, 2012 and other strategic alternatives available to the Company. The Board appointed each of Mr. Raymond Leal, Mr. Xiaosong Hu and Mr. Yaoguo Pan as members of the special committee. The Board delegated exclusive power and authority to the special committee in connection with its evaluation of Mr. Xianfu Zhu’s preliminary proposal for a going private transaction, including the exclusive power and authority to (i) formulate, establish, oversee and direct a process for the identification, evaluation and negotiation of a potential sale of the Company, (ii) evaluate and negotiate the terms of any proposed definitive or other agreements in respect of a potential sale of the Company, (iii) make recommendations to the Board in respect of any potential transaction, including, without limitation, any recommendation to not proceed with or to recommend that the Company’s stockholders reject a potential sale of the Company and (iv) make recommendations to the Board that the Board take other actions or consider other matters that the special committee deems necessary or appropriate with respect to any potential sale of the Company or other potential alternative transactions. In connection with the formation of the special committee, the Board resolved that it would not approve or recommend to the Company’s stockholders any potential sale of the Company without the favorable recommendation of the special committee.

The special committee, at a meeting held on November 23, 2012, unanimously determined that the merger agreement, the merger and the other transactions contemplated by the merger agreement were advisable and fair (both substantively and procedurally) to and in the best interests of the Company and its unaffiliated stockholders, and recommended that the Board adopt resolutions approving and declaring the advisability of the merger agreement, the merger and the other transactions contemplated by the merger agreement and recommending that the stockholders of the Company adopt the merger agreement. The Board, acting upon the unanimous recommendation of the special committee, unanimously approved the resolutions recommended by the special committee in a unanimous written consent dated November 23, 2012.

In reaching its determination, the special committee consulted with and received the advice of its legal advisors, discussed certain issues with the Company’s senior management team as well as the Company’s outside legal advisors. The special committee and the Board considered a number of factors that it believed supported its decision to enter into the merger agreement and consummate the proposed merger, including, but not limited to, the following material factors which are not listed in any relative order of importance:

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The special committee and the Board also believed that sufficient procedural safeguards were and are present to ensure the fairness of the proposed merger and to permit the special committee and the Board to represent effectively the interests of the Company’s unaffiliated stockholders. These procedural safeguards include:

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The special committee, at a meeting held on February 8, 2013, unanimously determined that the merger agreement, the merger and the other transactions contemplated by the merger agreement were advisable and fair (both substantively and procedurally) to and in the best interests of the Company and its unaffiliated

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stockholders, and recommended that the Board adopt resolutions approving and declaring the advisability of the merger agreement (as amended and restated), the merger and the other transactions contemplated by the merger agreement and recommending that the stockholders of the Company adopt the merger agreement. The Board, acting upon the unanimous recommendation of the special committee, unanimously adopted the resolutions recommended by the special committee on February 8, 2013.

On February 8, 2013, each of the special committee and the Board determined that the proposed merger is substantively and procedurally fair to the Company’s unaffiliated stockholders based upon the following factors, which are not listed in any relative order of importance:

In addition, the special committee and the Board believed that sufficient procedural safeguards were and are present to ensure the fairness of the proposed merger, based upon the terms of the amended and restated merger agreement, and to permit the special committee and the Board to represent effectively the interests of the Company’s unaffiliated stockholders. These procedural safeguards include:

In the course of its deliberations, the special committee and the Board also considered a variety of risks and other countervailing factors related to entering into both the original merger agreement entered into on November 26, 2012 and the amended and restated merger agreement entered into on February 8, 2013 and the proposed merger, including:

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In analyzing the proposed merger and in reaching its determination as to the fairness (both substantively and procedurally) of the transactions contemplated by the merger agreement, the special committee considered, among other factors, the analyses and methodologies of Cowen and Duff & Phelps in evaluating the going concern value of the Company. See “ Special Factors — Opinion of Cowen and Company (Asia) Limited, Financial Advisor to the Special Committee ” and “ Special Factors — Opinion of Duff & Phelps, Financial Advisor to the Special Committee ” beginning on pages 41 and 48. Cowen’s and Duff & Phelps’ analyses were based upon certain management-provided scenarios and assumptions, but did not include an independent analysis of the liquidation value or book value of the Company. The special committee did not consider liquidation value as a factor because it considers the Company to be a viable going concern business and the

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trading history of the Company’s common stock to generally be an indication of its value as such. In addition, due to the fact that the Company is being sold as a going concern, the special committee did not consider the liquidation value of the Company relevant to a determination as to whether the proposed merger is fair to the Company’s unaffiliated stockholders as they believed the value of the Company’s assets that might be realized in a liquidation would be significantly less than its going concern value. Further, the special committee did not consider net book value a material indicator of the value of the Company because it believed that net book value is not a material indicator of the value of the Company as a going concern but rather is reflective of historical costs. The Company’s net book value per share was $15.04 as of March 31, 2013. In addition, the special committee did not consider the purchase prices paid by the Company to acquire shares of the Company in previous purchases in the past two years, as all such purchases had only been made in the public market during that period.

The foregoing discussion of the factors considered by the special committee and the Board includes the material factors considered by the special committee and the Board. The special committee and the Board collectively reached the conclusion to approve the merger agreement, the merger and the other transactions contemplated by the merger agreement in light of the various factors described above and other factors that the members of the special committee and the Board believed were appropriate. In view of the wide variety of factors considered by the special committee and the Board in connection with its evaluation of the proposed merger and the complexity of these matters, the special committee and the Board did not consider it practical, and did not attempt, to quantify, rank or otherwise assign relative weights to the specific factors it considered in reaching its decision and did not undertake to make any specific determination as to whether any particular factor, or any aspect of any particular factor, was favorable or unfavorable to the ultimate determination of the special committee. Rather, the special committee made its recommendation and the Board approved the merger agreement based on the totality of information presented to it and the investigation conducted by it. In considering the factors discussed above, individual members of the special committee and the Board may have given different weights to different factors.

In reaching its determination that the merger agreement and the transactions contemplated thereby, including the merger, are in the best interests of the Company and our unaffiliated stockholders and its decision to approve the merger agreement and recommend the adoption of the merger agreement by our stockholders, our Board considered the analysis and recommendation of the special committee and the factors examined by the special committee as described above under the caption “ Special Factors — Recommendation of Our Board of Directors and Special Committee; Reasons for Recommending the Adoption of the Merger Agreement; Fairness of the Merger ” and adopted such recommendations and analysis. For the foregoing reasons, our Board believes that the merger agreement and the transactions contemplated thereby are substantively and procedurally fair to the holders of the Company’s common stock (other than the Rollover Investors).

The foregoing discussion of the factors considered by the Board includes the material factors considered by the Board. The Board collectively reached the conclusion to approve the merger agreement, the merger and the other transactions contemplated by the merger agreement in light of the various factors described above and other factors that the members of the Board believed were appropriate. In view of the wide variety of factors considered by the Board in connection with its evaluation of the proposed merger and the complexity of these matters, the Board did not consider it practical, and did not attempt, to quantify, rank or otherwise assign relative weights to the specific factors it considered in reaching its decision and did not undertake to make any specific determination as to whether any particular factor, or any aspect of any particular factor, was favorable or unfavorable to the ultimate determination of the Board. Rather, the Board made its recommendation based on the totality of information presented to it and the investigation conducted by it. In considering the factors discussed above, individual directors may have given different weights to different factors. In light of the procedural protections described above, other than the special committee and its legal and financial advisors, the Board did not consider it necessary to retain an unaffiliated representative to act solely on behalf of the Company’s unaffiliated stockholders for purposes of negotiating the terms of the merger agreement or preparing a report concerning the fairness of the merger agreement and the merger, nor did the Board consider it necessary to make any provision to grant unaffiliated stockholders access to the Company’s corporate files or to obtain counsel or appraisal services for unaffiliated stockholders.

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In connection with the consummation of the merger, certain of the Company’s directors may receive benefits and compensation that may differ from the per share merger consideration you would receive. See “ Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger ” beginning on page 68 of this proxy statement.

The Board recommends that the stockholders of the Company vote “FOR” adoption of the merger agreement.

Opinion of Cowen and Company (Asia) Limited, Financial Advisor to the Special Committee

Pursuant to an engagement letter dated December 12, 2012, among the Company, the special committee and Cowen, the special committee retained Cowen, among other things, to render an opinion to the special committee as to the fairness, from a financial point of view, to the holders of the Company’s common stock, other than shares held by the Excluded Holders of the per share merger consideration.

On February 8, 2013, Cowen delivered its oral opinion to the special committee, subsequently confirmed in writing as of the same date, to the effect that and subject to the various assumptions, qualifications and limitations set forth therein, as of February 8, 2013, the per share merger consideration is fair, from a financial point of view, to the stockholders of the Company, other than the Excluded Holders.

The full text of the written opinion of Cowen, dated February 8, 2013, is attached to this proxy statement as Annex B and is incorporated by reference. Holders of the Company’s common stock are urged to read the opinion in its entirety for the assumptions made, procedures followed, other matters considered and limits of the review by Cowen. Cowen’s analyses and opinion were prepared for and addressed to the special committee and are directed only to the fairness, from a financial point of view, of the per share merger consideration and do not constitute an opinion as to the merits of the proposed merger or a recommendation to any stockholder as to how to vote on the proposed merger. Cowen has consented to the inclusion of its analyses and opinion as an annex and exhibit to this proxy statement. The per share merger consideration was determined through negotiations between the special committee and Mr. Xianfu Zhu and not pursuant to recommendations of Cowen.

In arriving at its opinion, Cowen:

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In conducting its review and arriving at its opinion, Cowen, with the special committee’s consent, assumed and relied, without independent investigation, upon the accuracy and completeness of all financial and other information provided to it by the Company and the special committee or which was publicly available or was otherwise reviewed by Cowen. Cowen did not undertake any responsibility for the accuracy, completeness or reasonableness of, or independent verification of, such information. Cowen relied upon, without independent verifications, the assessment of the Company’s management as to the existing products and services of the Company and the viability of, and risks associated with, the future products and services of the Company. In addition, Cowen did not conduct, or assume any obligation to conduct, any physical inspection of the properties or facilities of the Company. Cowen further relied upon the Company’s representation that all information provided to it by the Company or the special committee was accurate and complete in all material respects. Cowen, with the special committee’s consent, assumed that the October Management Projections and the Updated 2012 Estimates were reasonably prepared by the Company’s management on bases reflecting the best available estimates and good faith judgments of the Company’s management as to the future performance of the Company, and that the October Management Projections, the Updated 2012 Estimates and the Wall Street Projections provided a reasonable basis for its opinion. Cowen expressed no opinion as to the October Management Projections, the Updated 2012 Estimates and the Wall Street Projections or the assumptions on which they were made. Cowen assumed that the final versions of all documents it reviewed in draft form conform in all material respects to the drafts reviewed. Cowen expressly disclaimed any undertaking or obligation to advise any person of any change in any fact or matter affecting its opinion of which Cowen becomes aware after the date of its opinion.

Cowen did not make or obtain any independent evaluations, valuations or appraisals of the assets or liabilities of the Company, nor was Cowen furnished with these materials. In addition, Cowen did not evaluate the solvency or fair value of the Company, Parent or Merger Sub under any state, federal or other laws relating to bankruptcy, insolvency or similar matters. Cowen did not address any legal, tax or accounting matters related to the merger agreement or the proposed merger, as to which Cowen assumed that the Company and the special committee had received such advice from legal, tax and accounting advisors as each had determined appropriate. Cowen’s opinion addressed only the fairness, from a financial point of view, to the stockholders of the Company other than the Excluded Holders of the per share merger consideration. Cowen’s opinion was necessarily based upon economic and market conditions and other circumstances as they existed and could be evaluated by Cowen on the date of its opinion. Although subsequent developments may affect its opinion, Cowen does not have any obligation to update, revise or reaffirm its opinion and Cowen expressly disclaimed any responsibility to do so.

In rendering its opinion, Cowen assumed, in all respects material to its analysis, that the representations and warranties of each party contained in the merger agreement were true and correct, that each party will perform all of the covenants and agreements required to be performed by it under the merger agreement and that all conditions to the consummation of the proposed merger will be satisfied without waiver thereof. Cowen also assumed that all governmental, regulatory and other consents and approvals contemplated by the merger agreement would be obtained and that, in the course of obtaining any of those consents and approvals, no restrictions or conditions would be imposed that would have an adverse effect on the contemplated benefits of the proposed merger.

Cowen’s opinion does not constitute a recommendation to any stockholder as to how the stockholder should vote on the proposed merger. Cowen was not requested to opine as to, and its opinion did not in any manner address, the underlying business decision to effect the proposed merger or the relative merits of the proposed merger as compared to other business strategies or transactions that might be available to the Company and Cowen was not involved in the negotiation of any terms of the proposed merger. Cowen was not requested to opine as to, and its opinion did not in any manner address, the fairness of the amount or the nature of any

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compensation to any of the Company’s officers, directors or employees, or any class of such persons, relative to the per share merger consideration or otherwise.

The following is a summary of the principal financial analyses performed by Cowen to arrive at its opinion. The order of the analyses described below does not represent the relative importance or weight given to those analyses by Cowen. Some of the summaries of financial analyses include information presented in tabular format. In order to fully understand the financial analyses, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses. Considering the data set forth in the tables without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of the financial analyses. Cowen performed certain procedures, including each of the financial analyses described below, and reviewed with the management of the Company the assumptions on which such analyses were based and other factors, including the historical and projected financial results of the Company. No limitations were imposed by the special committee with respect to the investigations made or procedures followed by Cowen in rendering its opinion.

Analysis of Premiums in Selected Transactions.   As summarized in the table below, Cowen reviewed premiums in 24 transactions announced since January 1, 2008, involving a change of control of U.S.-listed Chinese companies with implied equity values between $100 million and $1.5 billion. Cowen did not include transactions meeting these criteria that were withdrawn or terminated.

Date		Target		Buyer
12/26/2012		BCD Semiconductor Manufacturing Limited		Diodes Incorporated
10/15/2012		Yongye International, Inc.		Chairman, Abax, Full Alliance, Morgan Stanley PE Asia
10/03/2012		Feihe International, Inc.		Chairman, Morgan Stanley PE Asia
09/27/2012		China Kanghui Holdings		Medtronic, Inc.
09/26/2012		7 Days Group Holdings Limited		Chairman, Carlyle, Sequoia
09/12/2012		3SBio Inc.		Chairman, CPEChina, CITIC PE
07/06/2012		ShangPharma Corporation		Chairman, ChemPartner, TPG
05/09/2012		China Nuokang Bio-Pharmaceutical Inc.		Chairman
04/02/2012		Winner Medical Group Inc.		Chairman
02/21/2012		China TransInfo Technology Corp.		Chairman, SAIF
11/21/2011		Global Education & Technology Group Limited		Pearson plc
10/28/2011		China Real Estate Information Corporation		E-House (China) Holdings Limited
09/29/2011		LianDi Clean Technology, Inc.		SJI Inc.
06/27/2011		Tiens Biotech Group (USA), Inc.		Chairman
06/03/2011		Acorn International, Inc.		Individual investors
03/25/2011		Funtalk China Holdings Limited		Management, PAG
03/07/2011		China Fire & Security Group, Inc.		Management, Bain Capital
01/28/2011		China Security & Surveillance Technology, Inc.		Chairman
11/11/2010		Chemspec International Limited		Chairman, Primavera Capital
11/03/2010		Fushi Copperweld, Inc.		Chairman, Abax Global
10/28/2010		BMP Sunstone Corporation		Sanofi-Aventis
10/11/2010		Harbin Electric, Inc.		Chairman, Baring Asia
08/03/2010		Hanwha SolarOne Co., Ltd		Hanwha Solar Holdings Co., Ltd.
04/08/2010		Tongjitang Chinese Medicines Company		Chairman, Fosun International

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For these transactions, the table below lists premiums representing the offer price over the trading prices 1 trading day, 1 week, 1 month and 3 months prior to the announcement date of the transaction.

		Premiums to Market
		Selected Transactions								Proposed Merger
Premiums to Stock Price:		Median				Mean
1 day prior to announcement			28.0	%			40.8	%			46.6	%
1 week prior to announcement			34.4	%			48.2	%			58.8	%
1 month prior to announcement			34.4	%			49.8	%			20.4	%
3 months prior to announcement			34.7	%			49.8	%			57.9	%

Implied Per Share Equity Value Reference Ranges Based on

1 Day Prior Premium

1 Week Prior Premium

1 Month Premium

3 Months Premium

Merger Consideration

$11.79 – $12.97

$

11.42 – $12.60

$

15.07 – $16.80

$

11.52 – $12.81

$

13.50

Analysis of Selected Transactions.   Cowen reviewed the financial terms, to the extent publicly available, of the 11 announced or completed transactions listed below, which involved the acquisition of companies in the Chinese food and beverage industry and global meat processing and meat product industry with implied equity values between $100 million and $1.5 billion, which were announced or completed since January 1, 2008. Cowen did not include transactions meeting these criteria that were withdrawn or terminated.

Date Announced

Target

Buyer

Implied Equity Value

Implied Enterprise Value

LTM EBITDA

LTM Net Income

Enterprise Value/ LTM EBITDA

Equity Value/ LTM Net Income

01/18/2013

Yonekyu Corp.

Mitsubishi Corporation

$

268.1

$

176.9

$

28.4

$

-2.7

6.2x

NM

10/15/2012

Synear Food Holdings Ltd

Management

209.3

119.6

17.9

-1.3

6.7x

NM

10/03/2012

Feihe International, Inc.

Chairman; Morgan Stanley PE Asia

146.4

205.6

25.8

14.8

8.0x

9.9x

08/20/2012

Wuhan Asia-Pacific Condiments Co., Ltd.

McCormick & Company, Incorporated

141.0

141.0

11.8

NA

12.0x

NA

12/05/2011

National Beef Packing Co. LLC

Leucadia National Corporation

1,099.3

1,409.0

324.2

258.5

4.3x

4.3x

08/15/2011

Stavropolskiy Broiler ZAO

Resurs Group

160.0

160.0

NA

1.3

NA

NM

06/14/2010

Keystone Foods, LLC

Marfrig Alimentos SA

1,260.0

1,260.0

NA

NA

NA

NA

06/11/2010

AFFCO Holdings Ltd.

Talleys Group Limited

128.6

183.7

30.7

17.9

6.0x

7.2x

01/15/2010

Viskase Companies Inc.

Icahn Enterprises, L.P.

184.9

321.9

50.6

16.7

6.4x

11.0x

03/05/2008

Swift Australia (Southern) Pty Ltd.

JBS Australia Pty Limited

100.0

150.0

NA

NA

NA

NA

03/04/2008

JBS Packerland Inc.

JBS S.A.

575.5

575.5

NA

-23.5

NA

NM

03/27/2012

Zhongpin

Chairman; China Wealth Growth Fund

503.5

818.6

96.8

43.9

8.5x

11.5x

For each transaction, based on publicly available information, Cowen calculated the implied equity value, implied enterprise value, implied enterprise value as a multiple of LTM EBITDA and implied equity value as a multiple of LTM net income, with the implied enterprise value meaning implied equity value plus debt and minority interest, minus total cash and cash equivalents; LTM EBITDA meaning a company’s earnings before interest expense, income taxes, depreciation and amortization for the last twelve months through the reported transaction; and LTM net income meaning a company’s net income for the last twelve months through the reported transaction.

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The following table presents these multiples for the selected transactions and for the proposed merger. Cowen used a range of 5.5x to 7.5x enterprise value/LTM EBITDA multiples and 6.5x to 10.5x equity value/LTM net income multiples for the analysis.

Multiples for Selected Transactions

Multiples Implied by the Per Share Merger Consideration for the Company

Min

Mean

Median

Max

Enterprise value as a multiple of:

LTM EBITDA

4.3x

7.1x

6.4x

12.0x

8.5x

Equity value as a multiple of:

LTM net income

4.3x

8.1x

8.5x

11.0x

11.5x

Implied Per Share Equity Value Reference Ranges Based on
Enterprise Value/LTM EBITDA Multiple		Equity Value/LTM Net Income				Merger Consideration
$5.84 – $11.03		$	7.67 – $12.37			$	13.50

Cowen noted that although the selected transactions were used for comparison purposes, none of the transactions is directly comparable to the proposed merger, and none of the companies in these transactions is directly comparable to the Company. Accordingly, Cowen’s analysis was not purely mathematical, but instead necessarily involved complex considerations and judgments concerning differences in financial and operating characteristics of the selected companies and the Company, the terms of the selected transactions and other factors.

Analysis of Selected Public Companies.   To highlight comparative market information, Cowen compared various estimated operating and financial data and ratios for the Company to the corresponding data and ratios of selected companies whose securities are publicly traded. The selected companies included foreign listed Chinese food companies, global meat processing and meat product companies with market values between $100 million and $1.5 billion. The data and ratios included estimated revenue growth, EBITDA margins, net margins, estimated enterprise value to EBITDA ratios and price/earnings ratios, with the estimates for the Company based on the October Management Projections and consensus analyst estimates from Capital IQ, and the estimates for the selected companies based on consensus analyst estimates from Capital IQ.

		Ratio Analysis																								Market Data								Market Analysis
		Revenue Growth								EBITDA Margin								Net Margin								Market Value				Enterprise Value				EV/EBITDA								Price/Earnings
Company		CY2012				CY2013				CY2012				CY2013				CY2012				CY2013												CY2012				CY2013				CY2012				CY2013
China Yurun Food Group Ltd.			(10.1	)%			25.4	%			1.7	%			3.7	%			NM				1.1	%		$	1,346.9			$	1,724.2				NM				9.8x				NM				25.9x
Itoham Foods Inc.			(1.5	)%			0.8	%			2.6	%			3.2	%			NA				NA				1,032.1				1,048.7				8.4x				6.9x				NA				NA
Bell AG			1.3	%			0.9	%			8.5	%			8.1	%			3.1	%			3.2	%			928.1				1,206.7				5.1x				5.3x				7.4x				9.9x
Minerva S.A			9.4	%			14.9	%			10.2	%			11.0	%			NM				3.9	%			941.8				1,863.4				8.4x				6.8x				NM				10.8x
OJSC Cherkizovo Group			5.1	%			15.1	%			19.0	%			16.9	%			12.3	%			9.8	%			771.4				1,629.2				5.5x				5.4x				3.9x				4.2x
Cranswick plc			7.6	%			7.0	%			7.4	%			7.4	%			4.2	%			4.3	%			754.8				811.7				8.2x				7.7x				13.2x				12.3x
Campofrio Food Group, S.A.			3.7	%			2.8	%			8.1	%			8.5	%			1.3	%			1.9	%			633.0				1,285.5				6.1x				5.7x				20.1x				12.7x
China Minzhong Food Corporation Limited			35.4	%			20.2	%			35.8	%			34.5	%			25.0	%			23.6	%			454.9				512.2				3.1x				2.7x				3.9x				3.5x
HKScan Oyj			1.8	%			2.3	%			4.5	%			4.9	%			0.3	%			0.8	%			295.9				948.2				6.1x				5.5x				25.8x				10.6x
Atria Oyj			2.4	%			2.4	%			6.3	%			6.8	%			0.8	%			1.5	%			277.4				847.2				7.4x				6.8x				19.8x				10.1x
Kakiyasu Honten Co., Ltd.			2.5	%			1.6	%			8.3	%			8.7	%			NA				NA				171.8				119.7				3.2x				3.0x				NA				NA
Sino Grandness Food Industry Group Limited			59.3	%			37.1	%			24.1	%			22.6	%			16.4	%			14.5	%			170.3				202.6				3.2x				2.5x				4.0x				3.3x
Zhongpin (Offer – October Management Projections)			12.7	%			17.8	%			6.3	%			7.2	%			3.2	%			3.6	%			503.5				818.6				7.9x				5.9x				9.7x				7.1x
Zhongpin (Offer – Consensus Estimates)			11.1	%			13.5	%			6.0	%			5.8	%			2.8	%			3.0	%			503.5				818.6				8.4x				7.7x				11.1x				9.2x
Zhongpin (Current – October Management Projections)			12.7	%			17.8	%			6.3	%			7.2	%			3.2	%			3.6	%			477.6				792.7				7.6x				5.7x				9.2x				6.8x
Zhongpin (Current – Consensus Estimates)			11.1	%			13.5	%			6.0	%			5.8	%			2.8	%			3.0	%			477.6				792.7				8.1x				7.4x				10.5x				8.7x

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The following table presents implied enterprise value as a multiple of 2012 and 2013 calendar year estimated EBITDA and implied equity value as a multiple of 2012 and 2013 calendar year estimated earnings. The information in the table is based on closing stock prices as of February 6, 2013. Cowen used a range of 5.0x to 7.0x enterprise value/2012E EBITDA multiples, 4.5x to 6.5 enterprise value/2013E EBITDA multiples, 8.5x to 12.5x 2012E P/E ratios and 8.5x to 12.5x 2013E P/E ratios for the analysis.

Multiples Implied by the Per Share Merger Consideration for the Company

Selected Company Multiples

Based on Consensus Estimates

Based on October Management Projections

Min

Mean

Median

Max

Enterprise value as a multiple of:

CY 2012 EBITDA

3.1x

5.9x

6.1x

8.4x

8.4x

7.9x

CY 2013 EBITDA

2.5x

5.7x

5.6x

9.8x

7.7x

5.9x

Equity value as a multiple of:

CY 2012 Earnings

3.9x

12.3x

10.3x

25.8x

11.1x

9.7x

CY 2013 Earnings

3.3x

10.3x

10.3x

25.9x

9.2x

7.1x

Implied Per Share Equity Value Reference Ranges Based on
CY 2012 EBITDA						CY 2013 EBITDA								CY 2012 Earnings								CY 2013 Earnings
October Management Projections		Consensus Estimates				October Management Projections				Consensus Estimates				October Management Projections				Consensus Estimates				October Management Projections				Consensus Estimates				Merger Consideration
$5.53 - $11.12		$	4.67 - $9.92			$	11.81 - $17.37			$	10.37 - $15.25			$	8.33 - $15.73			$	4.40 - $10.11			$	16.09 - $23.66			$	12.45 - $18.31			$	13.50

Cowen noted that although the selected companies were used for comparison purposes, none of the companies is directly comparable to the Company. Accordingly, Cowen’s analysis was not purely mathematical, but instead necessarily involved complex considerations and judgments concerning differences in financial and operating characteristics of the selected companies and the Company and other factors that could affect the relative values of the selected companies and the Company.

Historical Stock Prices.   Cowen reviewed the closing prices of the Company’s common stock on various days prior to the announcement of the proposed merger. The table below illustrates the closing prices on those days and the premium implied by the offer price in the proposed merger.

		Historical Spot Price				Premium Implied by Offer Price
3 months prior to announcement		$	8.55				57.9	%
1 month prior to announcement			11.21				20.4	%
1 week prior to announcement			8.50				58.8	%
1 day prior to announcement			9.21				46.6	%
High (latest twelve months)			13.02				3.7	%
Low (latest twelve months)			8.11				66.5	%
February 6, 2013			12.81				5.4	%

Discounted Cash Flow Analysis.   Cowen estimated a range of values for the Company’s common stock based upon the discounted present value of the projected after-tax cash flows of the Company described in the October Management Projections, for the fiscal years ended 2013 through 2016, and of the terminal value of the Company at December 31, 2016, based upon multiples of EBITDA. After-tax cash flow was calculated by taking projected EBIT and subtracting from this amount projected taxes, capital expenditures and changes in working capital and adding back projected depreciation and amortization. This analysis was based upon certain assumptions described by, projections supplied by and discussions held with the management of the Company. In performing this analysis, Cowen utilized discount rates ranging from 8.5% to 12.5%, which were selected based on the estimated weighted average cost of capital of selected companies which are listed below. Cowen utilized terminal multiples of EBITDA ranging from 5.0 times to 7.0 times, these multiples representing the general range of multiples of EBITDA for selected public companies. Utilizing this methodology, the per share equity value of the Company ranged from $9.10 to $17.91 per share.

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		Projected
Fiscal year ended December 31,		2013				2014				2015				2016
EBITDA		$	138.9			$	138.1			$	152.2			$	166.6
Depreciation & amortization			43.2				51.3				57.8				63.4
EBIT			95.7				86.8				94.4				103.2
Less: Taxes			8.4				7.7				8.8				9.8
EBIAT			87.3				79.1				85.6				93.4
Plus: Depreciation & amortization			43.2				51.3				57.8				63.4
Less: Capital expenditures, net			(68.0	)			(121.0	)			(98.0	)			(83.0	)
Decrease/(Increase) in working capital			(1.6	)			(6.5	)			(5.5	)			(6.5	)
Unlevered free cash flow		$	60.9			$	2.9			$	39.9			$	67.3

		Terminal multiple of 2016 EBITDA
Discount Rate		5.0x				5.5x				6.0x				6.5x				7.0x
8.5%		$	11.54			$	13.15			$	14.74			$	16.33			$	17.91
9.5%			10.87				12.41				13.94				15.46				16.99
10.5%			10.25				11.74				13.21				14.69				16.16
11.5%			9.66				11.10				12.52				13.95				15.37
12.5%			9.10				10.48				11.86				13.24				14.61

Cowen selected foreign listed Chinese food companies, global meat processing and meat product companies with market values between $100 million and $1.5 billion to calculate estimated weighted average cost of capital and terminal multiples of EBITDA. The companies were:

Leveraged Buyout Analysis.   Cowen estimated a range of values for the Company’s common stock that a hypothetical financial buyer would pay to acquire the Company, assuming (i) target internal rates of return in the range of 19% to 32%, which range of percentages was generally reflective of the range of required internal rates of return commonly assumed when performing a leveraged acquisition analysis of this type; (ii) a ratio of total acquisition debt to LTM EBITDA of 3.5x, which was a generally accepted leverage ratio when debt lenders participated in a leverage acquisition transaction of this type; and (iii) a mid-point exit multiple of 6.0 times estimated 2016 EBITDA, which exit multiple was determined based on an approximate median enterprise value to LTM EBITDA multiple derived from the selected public companies. This analysis was based upon certain assumptions described by, projections supplied by, and discussions held with, the

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management of the Company. The leveraged buyout analysis indicated an implied equity value per share range of the Company’s common stock between $8.22 to $11.24 per share, as compared to the offer price of $13.50.

Entry EBITDA Multiple		Implied Total Enterprise Value				Implied Equity Value				Implied Purchase Price				Internal Rate of Return
5.50x		$	621.1			$	306.0			$	8.22				32	%
5.75x			649.3				334.2				8.98				28	%
6.00x			677.6				362.5				9.74				25	%
6.25x			705.8				390.7				10.49				22	%
6.50x			734.0				418.9				11.24				19	%

The summary set forth above does not purport to be a complete description of all the analyses performed by Cowen. The preparation of a fairness opinion involves various determinations as to the most appropriate and relevant methods of financial analysis and the application of these methods to the particular circumstances and, therefore, such an opinion is not readily susceptible to partial analysis or summary description. Cowen did not attribute any particular weight to any analysis or factor considered by it, but rather made qualitative judgments as to the significance and relevance of each analysis and factor. Accordingly, notwithstanding the separate factors summarized above, Cowen believes, and has advised the special committee, that its analyses must be considered as a whole and that selecting portions of its analyses and the factors considered by it, without considering all analyses and factors, could create an incomplete view of the process underlying its opinion. In performing its analyses, Cowen made numerous assumptions with respect to industry performance, business and economic conditions and other matters, many of which are beyond the control of the Company. These analyses performed by Cowen are not necessarily indicative of actual values or future results, which may be significantly more or less favorable than suggested by such analyses. In addition, analyses relating to the value of businesses do not purport to be appraisals or to reflect the prices at which businesses or securities may actually be sold. Accordingly, such analyses and estimates are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors. None of the Company, Cowen or any other person assumes responsibility if future results are materially different from those projected.

Cowen was selected by the special committee to render an opinion to the Company’s board because Cowen is a nationally recognized investment banking firm and because, as part of its investment banking business, Cowen is continually engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, negotiated underwritings, secondary distributions of listed and unlisted securities, private placements and valuations for corporate and other purposes. In the ordinary course of its business, Cowen and its affiliates trade the securities of the Company for their own account and for the accounts of their customers and, accordingly, may at any time hold a long or short position in such securities. Cowen and its affiliates in the ordinary course of business have from time to time provided, and in the future may continue to provide, commercial and investment banking services to the Company and have received and may in the future receive fees for the rendering of such services. In particular, in 2011, Cowen acted as an underwriter of an offering of the Company’s common stock by the Company. The issuance of Cowen’s opinion was approved by Cowen’s fairness opinion review committee.

Pursuant to the Cowen engagement letter, Cowen is entitled to receive fees for its services, of which $50,000 was paid upon Cowen’s engagement, $500,000 became payable upon the rendering of its opinion and $200,000 is contingent upon the consummation of the proposed merger. Additionally, the Company has agreed to indemnify Cowen against certain liabilities, including liabilities under the federal securities laws. The terms of the fee arrangement with Cowen, which are customary in transactions of this nature, were negotiated at arm’s length between the special committee and Cowen, and the special committee was aware of the arrangement, including the fact that a significant portion of the fee payable to Cowen is contingent upon the completion of the proposed merger. Cowen received compensation of $189,309.46 for acting as an underwriter of the offering of the Company’s stock.

Opinion of Duff & Phelps Securities, LLC, Financial Advisor to the Special Committee

Duff & Phelps was engaged to provide an opinion to the special committee as to the fairness, from a financial point of view, to the public stockholders of the Company (other than the Rollover Investors and affiliates of the Rollover Investors to the extent applicable and shares held by stockholders who have exercised, perfected

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and not withdrawn a demand for or lost the right to, appraisal rights under the DGCL) of the $13.50 per share merger consideration to be received by such stockholders in connection with the merger (without giving effect to any impact of the merger on any particular stockholder of the Company other than in its capacity as a stockholder). The special committee did not place specific limitations on the scope of Duff & Phelps’ analysis and opinion.

Duff & Phelps rendered its written opinion to the special committee on February 8, 2013, that, subject to the assumptions, qualifications and limiting conditions set forth therein, as of such date, the $13.50 per share merger consideration to be received by the public stockholders of the Company in the merger was fair, from a financial point of view, to such stockholders (without giving effect to any impact of the merger on any particular stockholder of the Company other than in its capacity as a stockholder). The full text of the written opinion of Duff & Phelps is attached as Annex C to this proxy statement and is incorporated herein by reference. Duff & Phelps has consented to the inclusion of its analyses and opinion as an annex and exhibit to this proxy statement.

The full text of the written opinion should be read carefully in its entirety for a description of the assumptions made, procedures followed, matters considered and qualifications and limitations of the review undertaken in connection with the opinion. The opinion of Duff & Phelps was addressed to the special committee, was given solely with respect to the merger and is not intended to be used, and may not be used, for any other purpose.

Duff & Phelps’ opinion:

In connection with its opinion, Duff & Phelps made such reviews, analyses and inquiries as it deemed necessary and appropriate under the circumstances. Duff & Phelps also took into account its assessment of general economic, market and financial conditions, as well as its experience in securities and business valuation in general, and with respect to similar transactions in particular. Duff & Phelps’ procedures, investigations and financial analyses with respect to the preparation of its opinion included, but were not limited to, the items summarized below:

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In performing its analyses and rendering its opinion with respect to the merger, Duff & Phelps, with the special committee’s consent:

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To the extent that any of the foregoing assumptions on which Duff & Phelps’ opinion was based prove to be untrue in any material respect, Duff & Phelps’ opinion cannot and should not be relied upon. In its analysis and in connection with the preparation of its opinion, Duff & Phelps made numerous assumptions with respect to industry performance, general business, market and economic conditions and other matters, many of which are beyond the control of any party involved in the merger.

Duff & Phelps did not evaluate the Company’s solvency or conduct an independent appraisal or physical inspection of any specific assets or liabilities (contingent or otherwise) of the Company. Duff & Phelps expressed no opinion as to the fairness of the amount or nature of any compensation to be received by any officers, directors or employees of any parties to the merger agreement, or any class of such persons, relative to the $13.50 per share merger consideration. The issuance of Duff & Phelps’ opinion was approved by an authorized fairness opinion committee of Duff & Phelps.

Although developments following the date of Duff & Phelps’ opinion may affect the opinion, Duff & Phelps assumes no obligation to update, revise or reaffirm its opinion. Duff & Phelps’ opinion is necessarily based upon market, economic and other conditions that were in effect on, and information made available to Duff & Phelps as of, the date of the opinion. Developments subsequent to February 8, 2013 may affect the conclusion expressed in Duff & Phelps’ opinion. Duff & Phelps disclaims any undertaking or obligation to advise any person of any change in any fact or matter affecting its opinion. Duff & Phelps’ opinion is limited to the fairness, from a financial point of view, of the $13.50 per share merger consideration to be received by the stockholders of the Company (other than the Rollover Investors and affiliates of the Rollover Investors to the extent applicable and shares held by stockholders who have exercised, perfected and not withdrawn a demand for or lost the right to, appraisal rights under the Delaware General Corporation Law) in the merger as of February 8, 2013 (without giving effect to any impact of the merger on any particular stockholder other than in its capacity as a stockholder) and does not speak as to the fairness of such consideration at any other point in time.

Set forth below is a summary of the material analyses performed by Duff & Phelps in connection with the delivery of its opinion to the special committee. The full text of the opinion is, attached to this proxy statement as Annex C. While this summary describes the analyses and factors that Duff & Phelps deemed material in its presentation to the special committee, it is not a comprehensive description of all analyses and factors considered by Duff & Phelps. The preparation of a fairness opinion is a complex process that involves various determinations as to the most appropriate and relevant methods of financial analysis and the application of these methods to the particular circumstances. Therefore, a fairness opinion is not readily susceptible to partial analysis. In arriving at its opinion, Duff & Phelps did not attribute any particular weight to any analysis or factor considered by it, but rather made qualitative judgments as to the significance and relevance of each analysis and factor. Accordingly, Duff & Phelps believes that its analyses must be considered as a whole and that selecting portions of its analyses and of the factors considered by it in rendering the fairness opinion without considering all analyses and factors could create a misleading or incomplete view of the evaluation process underlying its opinion. The conclusion reached by Duff & Phelps was based on all analyses and factors taken as a whole, and also on the application of Duff & Phelps’ own experience and judgment.

The financial analyses summarized below include information presented in tabular format. In order for Duff & Phelps’ financial analyses to be fully understood, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses. Considering the data below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of Duff & Phelps’ financial analyses.

Discounted Cash Flow Analysis

Duff & Phelps performed a discounted cash flow analysis of the estimated future unlevered free cash flows of the Company for the fiscal years ending December 31, 2012 through December 31, 2021, with “free cash flow” defined as cash that is available either to reinvest or to distribute to security holders. The discounted cash flow analysis was used to determine the net present value of estimated future free cash flows utilizing a weighted average cost of capital as the applicable discount rate. For the purposes of its discounted cash flow analysis, Duff & Phelps utilized and relied upon the October Management Projections, which are described in

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this proxy statement in the section entitled “ Special Factors — Prospective Financial Information. ” Financial projections for the fiscal years ending December 31, 2017 through December 31, 2021, which reflect the Company achieving a stable growth rate by the end of the fiscal year ending December 31, 2021, were extrapolated based on the October Management Projections and discussions with Company management. The costs associated with the Company being a publicly listed company were excluded from the financial projections because such costs would likely be eliminated as a result of the merger.

Duff & Phelps estimated the net present value of all cash flows of the Company after fiscal year 2021 (the “ terminal value ”) using a perpetuity growth formula assuming a 3.0% terminal growth rate, which took into consideration an estimate of the expected long-term growth rate of the economy and the Company’s business. Duff & Phelps used discount rates ranging from 11.25% to 12.25%, reflecting Duff & Phelps’ estimate of the Company’s weighted average cost of capital, to discount the projected free cash flows and terminal value. Duff & Phelps estimated the Company’s weighted average cost of capital by estimating the weighted average of the Company’s cost of equity (derived using the capital asset pricing model) and the Company’s after-tax cost of debt. Duff & Phelps believes that this range of discount rates is consistent with the rate of return that security holders could expect to realize on alternative investment opportunities with similar risk profiles.

Based on these assumptions, Duff & Phelps’ discounted cash flow analysis resulted in an estimated enterprise value for the Company of $727.0 million to $825.0 million and a range of implied values of the Company’s common stock of $12.98 to $15.65 per share.

The implied values of the Company’s common stock were derived by starting from the estimated enterprise value for the Company of $727.0 million to $825.0 and:

Selected Public Companies and Merger and Acquisition Transactions Analyses

Duff & Phelps analyzed selected public companies and selected merger and acquisition transactions for purposes of estimating valuation multiples with which to calculate a range of implied enterprise values of the Company. This collective analysis was based on publicly available information and is described in more detail in the sections that follow.

The companies utilized for comparative purposes in the following analysis were not identical to the Company, and the transactions utilized for comparative purposes in the following analysis were not identical to the merger. Duff & Phelps does not have access to nonpublic information of any of the companies used for comparative purposes. Accordingly, a complete valuation analysis of the Company and the merger cannot rely solely upon a quantitative review of the selected public companies and selected transactions, but involves

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complex considerations and judgments concerning differences in financial and operating characteristics of such companies and targets, as well as other factors that could affect their value relative to that of the Company. Therefore, the selected public companies and selected merger and acquisition transactions analysis is subject to certain limitations.

Selected Public Companies Analysis.   Duff & Phelps compared certain financial information of the Company to corresponding data and ratios from publicly traded companies in the global protein industry that Duff & Phelps deemed relevant to its analysis. For purposes of its analysis, Duff & Phelps used certain publicly available historical financial data and consensus equity analyst estimates for the selected publicly traded companies. This analysis produced valuation multiples of selected financial metrics which Duff & Phelps utilized to estimate the enterprise value of the Company. The five companies included in the selected public company analysis in the North American protein industry were:

Duff & Phelps also included the following fourteen companies in the selected public company analysis in the International protein industry:

Duff & Phelps selected these companies for its analysis based on their relative similarity, primarily in terms of business model and primary customers, to that of the Company.

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The tables below summarize certain observed trading multiples and historical and projected financial performance, on an aggregate basis, of the selected public companies. The estimates for 2012 and 2013 in the tables below with respect to the selected public companies were derived based on information for the 12-month periods ending closest to the Company’s fiscal year ends for which information was available. Data related to the Company’s earnings before interest, taxes, depreciation and amortization (“ EBITDA ”) was adjusted for purposes of this analysis to eliminate public company costs and estimated transaction costs related to the Merger.

		REVENUE GROWTH												EBITDA GROWTH												EBITDA MARGIN
		LTM				2013				2014				LTM				2013				2014				LTM				2013				2014
North American Protein Group
Mean			2.9 %				2.9 %				4.0 %				-9.3%				1.5 %				7.7 %				7.2 %				8.1 %				7.6 %
Median			2.3%				3.1%				3.8%				-11.9%				4.2%				8.2%				6.8%				8.3%				6.5%
International Protein Group
Mean			4.3%				6.9%				7.1%				4.6%				20.3%				11.8%				6.1%				7.7%				8.0%
Median			1.7%				2.5%				6.6%				-0.4%				14.7%				7.6%				6.1%				7.9%				7.8%
Aggregate:
Mean			3.9%				5.9%				6.4%				0.8%				15.3%				10.9%				6.4%				7.8%				7.9%
Median			2.3%				2.5%				4.4%				-3.9%				10.7%				7.9%				6.7%				7.9%				7.3%
Zhongpin Inc.			20.0%				16.7%				7.8%				-10.9%				21.9%				-0.5%				6.1%				7.2%				6.7%

ENTERPRISE VALUE AS MULTIPLE OF

PRICE AS A MULTIPLE OF

LTM EBITDA

2013 EBITDA

2014 EBITDA

2013 EBITDA –  CapEx

2014 EBITDA –  CapEx

LTM Revenue

2013 Revenue

LTM EPS

2013 EPS

2014 EPS

Book Value

North American Protein Group

Mean

7.2x

6.7x

6.2x

9.4x

8.7x

0.55x

0.56x

14.4x

13.3x

11.5x

1.87x

Median

6.4x

5.9x

5.5x

9.2x

8.6x

0.44x

0.47x

12.5x

11.8x

10.3x

1.45x

International Protein Group

Mean

9.0x

7.0x

6.2x

9.8x

9.8x

0.54x

0.55x

36.9x

14.1x

11.8x

1.27x

Median

8.1x

6.8x

6.0x

10.0x

9.5x

0.45x

0.45x

28.7x

12.8x

11.0x

1.04x

Aggregate:

Mean

8.5x

6.9x

6.2x

9.7x

9.5x

0.54x

0.55x

29.9x

13.9x

11.8x

1.43x

Median

7.8x

6.5x

5.7x

9.6x

9.3x

0.44x

0.45x

20.2x

12.3x

10.8x

1.35x

LTM = Latest Twelve Months
Enterprise Value = (Market Capitalization) + (Debt + Preferred Stock + Non-Controlling Interest) –
  (Cash & Equivalents) – (Net Non-Operating Assets)
EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortization
EPS = Earnings Per Share
Capex = Capital Expenditures
Source: Bloomberg, Capital IQ, SEC filings

The companies utilized for comparative purposes in Duff & Phelps’ analysis were not identical to the Company. As a result, a complete valuation analysis cannot be limited to a quantitative review of the selected public companies, but also requires complex considerations and judgments concerning differences in financial and operating characteristics of such companies, as well as other factors that could affect their value relative to that of the Company.

Selected M&A Transactions Analysis .  Duff & Phelps compared the Company to the target companies involved in the selected merger and acquisition transactions listed in the tables below. The selection of these transactions was based on, among other things, the target company’s industry, the relative size of the

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transaction compared to the merger and the availability of public information related to the transaction. The selected transactions indicated enterprise value to Latest Twelve Months (“ LTM ”) EBITDA multiples ranging from 3.6x to 17.0x with a median of 8.6x and enterprise value to LTM revenue multiples ranging from 0.15x to 3.24x with a median of 0.72x.

The Company is not directly comparable to the target companies in the Selected M&A Transactions Analysis given certain characteristics of the transactions and the target companies, including direct industry comparability (i.e., lack of comparable China-based protein processor targets) and lack of recent relevant transactions. Therefore, although reviewed, Duff & Phelps did not select valuation multiples for the Company based on the Selected M&A Transactions Analysis.

Global Protein Transactions

Date Announced		Acquirer Name		Target Name
08/10/2012		The Chefs’ Warehouse		Michael’s Finer Meats & Seafoods
12/21/2011		Thai Union Frozen Products		Pakfood Public Company Limited
12/05/2011		Leucadia National Corp.		National Beef Packing Co.
11/17/2011		High Liner Foods Inc.		Icelandic Group plc
10/28/2011		Industrias Bachoco S.A.B. de C.V.		O.K. Industries Inc.
10/03/2011		Sadia Alimentos S.A.		Avex S.A.
08/04/2011		Premium Brands Holdings Corp.		Piller Sausages & Delicatessens
03/04/2011		Cremonini S.p.A.		Inalca JBS Spa
01/13/2011		Campofrio Food Group		Cesare Fiorucci S.p.A
01/12/2011		Affinity Equity Partners		Tegel Foods Limited
08/09/2010		Sigma Foods, Inc.		Bar-S Foods Co.
06/14/2010		Marfrig Alimentos SA		Keystone Foods, LLC
09/14/2009		Marfrig Alimentos SA		Seara Alimentos S.A.
05/19/2009		Perdigao S.A.		Sadia S.A.
06/25/2008		Campofrio Alimentacion, S.A.		Groupe Smithfield, S.L.
03/04/2008		JBS S.A.		JBS Packerland Inc.
05/10/2007		JBS S.A.		S&C Holdco 3 Inc.

China-based Food Company Transactions

Date Announced		Acquirer Name		Target Name
10/15/2012		Management Buyout		Synear Food Holdings
10/15/2012		Abax Global/Morgan Stanley Private Equity Asia		Yongye International, Inc.
10/09/2012		Management Buyout		American Lorain Corp.
10/03/2012		Morgan Stanley Private Equity Asia		Feihe International, Inc.
07/11/2011		Nestle S.A.		Hsu Fu Chi International Ltd.
04/18/2011		Nestle S.A.		Xiamen Yinlu Group
08/16/2010		Management Buyout		Pine Agritech Ltd.

Summary of Selected Public Companies/M&A Transactions Analyses

In order to estimate a range of enterprise values for the Company, Duff & Phelps applied valuation multiples to the Company’s LTM EBITDA for the period ended September 30, 2012, projected EBITDA for the fiscal year ending December 31, 2013, projected EBITDA less Capital Expenditures (“ Capex ”) for the fiscal year ending December 31, 2013, LTM revenue for the period ended September 30, 2012 and projected revenue for the period ending December 31, 2013. In each case, EBITDA was adjusted to exclude public company costs and costs associated with the Merger. Duff & Phelps’ selected valuation multiples were as follows: LTM EBITDA multiple ranged from 7.5x to 8.5x, projected fiscal 2013 EBITDA multiple ranged from 5.25x to 6.0x, projected EBITDA less Capex multiple ranged from 10.0x to 11.0x, LTM revenue multiple ranged from 0.45x to 0.50x and projected 2013 revenue multiple ranged from 0.38x to 0.43x. Valuation multiples were selected taking into consideration historical and projected financial performance metrics of the Company relative to such metrics of the selected public companies, including, but not limited to, the Company’s smaller size on a revenue and EBITDA basis, lower projected EBITDA margins than the aggregate median of the

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selected public companies and lower projected EBITDA growth than the aggregate median of the selected public companies. Duff & Phelps noted that while it reviewed the selected M&A transactions, it did not select valuation multiples for the Company based on the Selected M&A Transactions Analysis. As a result of these selected valuation multiples, the selected public companies indicated an estimated enterprise value for the Company of $728.0 million to $818.5 million and a range of implied values of the Company’s common stock of $13.00 to $15.48 per share.

The implied values of the Company’s common stock were derived by starting from the estimated enterprise value for the Company of $728.0 million to $818.5 and:

Premiums Paid Analysis

Duff & Phelps analyzed the premiums paid by acquirers over the public market trading prices in going-private merger and acquisition transactions and in change of control transactions in the applications branded food products industry. The transactions analyzed by Duff & Phelps included transactions announced after January 2010. The medians of the premiums paid over the stock prices one-day, one-week, and one-month prior to the announcement of the transactions in the branded food products sector were 22.7%, 24.8%, and 26.7%, respectively. The medians of the premiums paid over the stock prices one-day, one-week, and one-month prior to the announcement of the transactions in going private transactions were 30.4%, 32.4%, and 32.7%, respectively. Duff & Phelps noted that the merger implies a 46.6% premium over the Company’s common stock closing price of $9.21 per share on March 26, 2012, the last full trading day prior to the public announcement of the terms of the offer and the merger, a 54.5% premium over the Company’s common stock closing price of $8.74 per share on March 21, 2012 one week prior to the public announcement of the terms of the offer and the merger, and a 20.4% premium over the Company’s common stock closing price of $11.21 per share on February 25, 2012 one month prior to the public announcement of the terms of the offer and the merger.

Summary of Analyses

The range of estimated enterprise values for the Company that Duff & Phelps derived from its discounted cash flow analysis was $727.0 million to $825.0 million, and the range of estimated enterprise values that Duff & Phelps derived from its selected public companies/M&A transactions analyses was $728.0 million to $818.5 million. Duff & Phelps concluded that the Company’s enterprise value was within a range of $727.5 million to $822.0 million based on the analyses described above.

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Based on the concluded enterprise value, Duff & Phelps estimated the range of common equity value of the Company to be $486.9 million to $591.6 million by:

Based on the foregoing analysis, Duff & Phelps estimated the value of each share of the Company’s common stock to range from $12.99 to $15.57. Duff & Phelps noted that the $13.50 per share merger consideration to be received by the public stockholders of the Company (other than the Rollover Investors and affiliates of the Rollover Investors to the extent applicable and shares held by stockholders who have exercised, perfected and not withdrawn a demand for or lost the right to, appraisal rights under the DGCL) in the merger was within the range of the per share value indicated by its analyses.

Duff & Phelps’ opinion was only one of the many factors considered by the special committee in its evaluation of the merger and should not be viewed as determinative of the views of the special committee.

Miscellaneous

The special committee selected Duff & Phelps because Duff & Phelps is a leading independent financial advisory firm, offering a broad range of valuation and investment banking services, including fairness and solvency opinions, mergers and acquisitions advisory, mergers and acquisitions due diligence services, financial reporting and tax valuation, fixed asset and real estate consulting, ESOP and ERISA advisory services, legal business solutions and dispute consulting. Duff & Phelps is regularly engaged in the valuation of businesses and securities in the preparation of fairness opinions in connection with mergers, acquisitions and other strategic transactions.

Fees and Expenses

As compensation for Duff & Phelps’ services in connection with the rendering of its opinion to the special committee, the Company agreed to pay Duff & Phelps $650,000 due and payable as follows: $50,000 in cash upon execution of the engagement letter with Duff & Phelps; $400,000 in cash upon Duff & Phelps’ delivery to the special committee of its opinion; and the remaining $200,000 in cash payable if a transaction (whether the merger or an alternative transaction) is consummated. No portion of Duff & Phelps’ fee is contingent upon the conclusion expressed in the opinion. The Company has also agreed to indemnify Duff & Phelps for certain liabilities arising out of its engagement.

The special committee also retained Duff & Phelps Securities, LLC (“ DPS ”), an affiliate of Duff & Phelps, to act as financial advisor to the special committee in connection with the Go-Shop Period provision of the merger agreement. For that engagement, DPS is due $100,000 in cash after the expiration of the merger agreement’s Go-Shop Period.

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The terms of the fee arrangements with Duff & Phelps and DPS, which the Company believes are customary in transactions of this nature, were negotiated at arm’s length, and the special committee and the Company’s board of directors are aware of these fee arrangements.

Other than the DPS engagement described above and the Duff & Phelps engagement to render its opinion to the special committee, during the two years preceding the date of the opinion, Duff & Phelps and its affiliates have not had any material relationship with any party to the merger agreement for which compensation has been received or is intended to be received, nor is any such material relationship or related compensation mutually understood to be contemplated.

Purposes and Reasons of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors for the Merger

Under SEC rules governing “going-private” transactions, each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors may be deemed to be an affiliate of the Company and may be required to state his, her or its purposes and reasons for the merger. Each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors is making the statements included in this section solely for the purpose of complying with the requirements of Rule 13e-3 and related rules under the Exchange Act. For the aforementioned persons, the purpose of the merger is to enable Parent to acquire control of the Company in a transaction in which the unaffiliated stockholders will receive $13.50 per share of the Company’s common stock. After the merger, shares of the Company’s common stock will cease to be publicly traded, and Parent will bear 100% of the risks and rewards of ownership of the Company. In addition, the merger will allow China Wealth and the Rollover Investors to invest in the Company through their equity investments in Holdco as described in this proxy statement under the section titled “ Special Factors — Financing of the Merger ” beginning on page 66, and at the same time enable Mr. Xianfu Zhu to maintain a leadership role with the surviving corporation.

Each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors believes that, as a privately-held entity, the Company’s management will have greater flexibility to focus on improving the Company’s long-term profitability without the constraints caused by the public equity market’s valuation of the Company and emphasis on short-term period-to-period performance. As a privately-held entity, the Company will have greater flexibility to make decisions that might negatively affect short-term results, but that could increase the Company’s value over the long term.

As a privately-held entity, the Company will also be relieved of many of the other expenses, burdens and constraints imposed on companies that are subject to the public reporting requirements under the federal securities laws of the United States, including the Exchange Act and Sarbanes-Oxley Act of 2002. The need for the management of the Company to be responsive to unaffiliated stockholders’ concerns and to engage in dialogue with unaffiliated stockholders can also at times distract management’s time and attention from the effective operation and improvement of the business.

Each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors decided to undertake the going-private transaction at this time to take advantage of the benefits of the Company being a privately-held company as described above, and because they were able to obtain financing from CDB on terms satisfactory to them.

Positions of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors Regarding the Fairness of the Merger

Under SEC rules governing “going-private” transactions, each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors may be deemed to be an affiliate of the Company and may be required to express his, her or its beliefs as to the fairness of the merger to the Company’s unaffiliated stockholders. Each of the aforementioned person is making the statements included in this section solely for the purposes of complying with the requirements of Rule 13e-3 and related rules under the Exchange Act. The views of these persons as to the fairness of the merger are not intended and should not be construed as a recommendation to any stockholder of the Company as to how to vote on the proposal to adopt the merger agreement. Each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors has interests in the merger that are different from, and in addition to, those of the stockholders unaffiliated with these persons, or the unaffiliated stockholders, of the Company by virtue of their continuing interests in the surviving corporation after the consummation of the merger.

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Each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors believes that the interests of the Company’s unaffiliated stockholders were represented by the special committee, which negotiated the terms and conditions of the merger agreement with the assistance of its independent legal and financial advisors. China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors attempted to negotiate a transaction that would be most favorable to them rather than the Company’s unaffiliated stockholders, and, accordingly, did not negotiate the merger agreement with a goal of obtaining terms that were substantively or procedurally fair to such stockholders. China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors did not participate in the deliberations of the special committee regarding, and did not receive any advice from the special committee’s independent legal or financial advisors as to, the fairness of the merger to the Company’s unaffiliated stockholders.

Based on their knowledge and analysis of available information regarding the Company, as well as discussions with the Company’s senior management regarding the Company and its business and the factors considered by, and findings of, the special committee and the Company’s board of directors discussed in the section titled “ Special Factors — Recommendation of Our Board of Directors and Special Committee; Reasons for Recommending the Adoption of the Merger Agreement; Fairness of the Merger ” beginning on page 34 (which consideration and findings are adopted by China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors solely for the purpose of making the statements in this section), each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors believes that the merger is substantively fair to the Company’s unaffiliated stockholders based upon the following factors:

Each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors believes that the merger is procedurally fair to the Company’s unaffiliated stockholders based upon the following factors:

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Each of China Wealth, Holdco, Parent, Merger Sub and the Rollover Investors believes these factors provide a reasonable basis for his, her or its belief that the merger is both substantively and procedurally fair to the Company’s unaffiliated stockholders. This belief, however, is not intended to be and should not be construed as a recommendation to any stockholder of the Company as to how such stockholder should vote with respect to the adoption of the merger agreement. The aforementioned persons attempted to negotiate the terms of a transaction that would be most favorable to them, and not to the unaffiliated stockholders of the Company, and accordingly, did not negotiate the merger agreement with a goal of obtaining terms that were fair to such stockholders.

Certain Effects of the Merger

If the merger is completed, all of our equity interests will be owned by Parent. Except for the Rollover Investors through their indirect interest in Parent, none of our current stockholders will have any ownership interest in, or be a stockholder of, the Company after the completion of the merger. As a result, our current stockholders (other than the Rollover Investors) will no longer benefit from any increase in our value, nor will they bear the risk of any decrease in our value. Following the merger, Parent will benefit from any increase in our value and also will bear the risk of any decrease in our value.

Upon completion of the merger, each share of Company common stock issued and outstanding immediately prior to the closing (other than treasury shares owned by the Company, including shares contributed to Parent