Ruili Group Co., Ltd. submitted a proposal to acquire an approximately 41.2% stake in SORL Auto Parts Inc. (NasdaqGM:SORL) (‘SORL’) for approximately $33.8 million on April 25, 2019. Ruili, along with Xiaoping Zhang, Shuping Chi and Xiaofeng Zhang who together already own a 58.9% stake in SORL, made the proposal whereby SORL will receive $4.26 in cash per share as consideration. The parties entered into an agreement and plan of merger for $37.5 million on November 29, 2019. Under the terms of the agreement, SORL shareholders will now receive $4.72 per share in cash. SORL Auto Parts, Inc. is required to pay a termination fee of $0.56 million to Ruili Group. Ruili Group is required to pay a termination fee of $1.13 million to SORL Auto Parts, Inc. In connection with the transaction, Ruili, Xiaoping Zhang, Shuping Chi and Xiaofeng Zhang entered into a consortium agreement which provides, among others, for: cooperation in engaging advisors; cooperation in obtaining applicable governmental, statutory, regulatory or other approvals, licenses, waivers or exemptions for the consummation of the transaction; and cooperation in preparing definitive documentation, approval of overseas investment registration with the competent local counterparts of the National Development and Reform Commission of the PRC, (ii) the outbound investment registration with Zhejiang Provincial Department of Commerce, and (iii) the registration with the competent local branch of the State Administration of Foreign Exchange of the PRC with respect to the transaction. Ruili will deliver an equity commitment letter pursuant to which it will fund cash to finance the purchase. Following the transaction, SORL will become a wholly owned subsidiary of Ruili. If the transaction is completed, the common stock of SORL would be delisted from the Nasdaq Global Market. The consortium will not move forward with the transaction unless it is approved by a special committee set up for the purpose. The Board of Directors of SORL Auto Parts Inc. has established a special committee comprising of independent directors named Xiao Lin and Binghua Freng to review the transaction. The transaction will also be subject to a non-waivable condition requiring approval of a majority of the shares not owned by the buying consortium or its affiliates, the negotiation and execution of definitive documents and other related agreements. As of November 29, 2019, the transaction was unanimously approved by Board of SORL on recommendation of the special committee. As of April 27, 2020, transaction has obtained all of the required regulatory approvals. Institutional Shareholder Services Inc. has recommended that SORL stockholders vote for the transaction. As of May 8, 2020, the shareholders of SORL Auto Parts, Inc. have approved the transaction at its special meeting of stockholders. The transaction is expected to complete in the second quarter of 2020. As of May 8, 2020, the transaction is expected to close on May 15, 2020. Ke Geng, Nima Amini and Alan Bao of O’Melveny & Myers LLP served as the legal advisor and Huatai United Securities Co., Ltd. as financial advisor to the buying consortium for the transaction. Duff & Phelps, LLC is serving as financial advisor and fairness opinion provider for a fee of $475,000 to the Special Committee, and Fang Xue of Gibson, Dunn & Crutcher LLP is serving as legal advisor to the Special Committee of SORL. Tim Tingkang Xia, Jaremi Chilton, Stanley Keller and Charles Wu of Locke Lord LLP acted as the legal advisor to SORL. Ruili Group Co., Ltd. completed the acquisition of an approximately 41.2% stake in SORL Auto Parts Inc. (NasdaqGM:SORL) on May 15, 2020. In connection with the consummation of the Merger the following individuals submitted their resignations and ceased to be members of the board of directors of SORL : Xiaofeng Zhang, Shuping Chi, Binghua Feng, Huilin Wang, Jianghua Feng, Jinbao Liu, Xiao Lin, and Yuhong Li. Xiaoping Zhang remains as SORL sole director following the consummation of the Merger. In connection with the consummation of the Merger, SORL has requested that trading of its common stock on NASDAQ be suspended prior to opening of trading on May 15, 2020.