China Agri : Certain Matters Relating to the Non-competition Deed

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CERTAIN MATTERS RELATING TO THE NON-COMPETITION DEED THE NON-COMPETITION DEED

COFCO, COFCO (HK) and the Company entered into the Non-competition Deed on 16 February 2007, pursuant to which each of COFCO and COFCO (HK) undertook that other than certain Retained Interests, and for so long as COFCO and its associates in aggregate hold not less than 30% of the issued shares of the Company, they would not, and would procure that none of their subsidiaries (other than the Company and its subsidiaries) will, at any time, either on their own behalf or as agent of any person, directly or indirectly, be employed or otherwise engaged or interested in any business which competes with the business of the Company or any part of it in any country in the world in which the Company carries on its business from time to time.

Pursuant to the Non-competition Deed, COFCO and COFCO (HK) have granted to the Company options to acquire all or part of the Retained Interests held by COFCO and/or COFCO (HK) on the basis of a valuation to be conducted by an independent valuer jointly appointed by COFCO and/or COFCO (HK) and the Company subject to any applicable laws and rules, relevant authorities' approvals and existing third-party pre-emptive rights (if any).

EXPANSION OF THE RETAINED INTERESTS

On 25 July 2016, the Company has received a notice (the "Notice") from COFCO that according to the notice of the State-owned Assets Supervision and Administration Commission, as approved by the State Council, Chinatex shall be integrated into COFCO and become its wholly-owned subsidiary (the "Strategic Restructuring").

Chinatex was established in 1951, and now focuses on two core businesses, i.e. textiles and grain & oil. Pursuant to the Notice, Chinatex currently has certain business including several oilseeds pressing, distillation and bulking plants operating in the PRC, which may directly or indirectly compete with the oilseeds processing business of the Company and its subsidiaries in the PRC (the "Competing Business").

According to the Non-competition Deed and the relevant schedule thereof, the Competing Business to be acquired under the Strategic Restructuring by COFCO will, upon completion of the Strategic Restructuring, fall within the scope of Retained Interests. Upon completion of the Strategic Restructuring, the option for the Company to acquire the Competing Business (the "New Option") will become effective in accordance with the Non-competition Deed and its schedule thereof, and a further announcement will be made pursuant to the disclosure obligations set out in the section headed "Relationship with COFCO and COFCO International" in the prospectus of the Company dated 8 March 2007.

FURTHER ARRANGEMENT IN RELATION TO THE NEW OPTION

Pursuant to the Non-competition Deed, the decision as to whether or not to exercise the New Option shall be voted on solely by the Independent Directors and be decided by majority votes of the Independent Directors.

The Independent Directors will review the New Option and decide whether to exercise the same on an annual basis. A final and definitive decision as to whether to exercise the New Option will be made by the Independent Directors on the fifth anniversary (being the last year of the option period) of the New Option having become effective, if such decision has not been made before such time. If for any reason further time after the fifth anniversary is deemed necessary for the proper evaluation of the New Option, the decision to extend would be voted on solely by the Independent Directors and be decided by majority votes.

DEFINITIONS

In this announcement, unless the context otherwise requires, the following expressions have the following meanings:

"Chinatex"	Chinatex Corporation, a company incorporated in the PRC;
"COFCO"	COFCO Corporation ( 中糧集團有限公司), a wholly state-owned company established in the PRC currently under the purview of the State-owned Assets Supervision and Administration Commission of the State Council of the PRC, the ultimate controlling shareholder of the Company;
"COFCO (HK)"	COFCO (Hong Kong) Limited, a company incorporated in Hong Kong with limited liability, a controlling shareholder of the Company and a directly wholly-owned subsidiary of COFCO;
"Company"	China Agri-Industries Holdings Limited, a company incorporated with limited liability under the laws of Hong Kong;
"Independent Directors"	the independent non-executive directors of the Company;

"Non-competition Deed"	the non-competition deed entered into among COFCO, COFCO (HK) and the Company on 16 February 2007;
"PRC"	the People's Republic of China; and
"Retained Interests"	the businesses under possession of COFCO and/or COFCO (HK) which competes with the Company.

Hong Kong, 26 July 2016

By Order of the Board

China Agri-Industries Holdings Limited CHI Jingtao

Chairman

As at the date of this announcement, the Board comprises: Mr. CHI Jingtao as chairman of the Board and executive director; Mr. GU Lifeng and Mr. SHI Bo as executive directors; Mr. YU Xubo and Mr. MA Wangjun as non-executive directors; and Mr. LAM Wai Hon, Ambrose, Mr. Patrick Vincent VIZZONE and Mr. ONG Teck Chye as independent non-executive directors.