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AgFeed Industries, Inc. Announces $50 Million Equity Credit Transaction

Published on 10 September, 2009, Last updated at 02:04 GMT

AgFeed Industries, Inc., one of the largest independent hog production and animal nutrient companies in China, announced today that it has entered into a two year Equity Credit Agreement with an institutional investor pursuant to which it may, from time to time, sell shares of its common stock to the investor for aggregate gross proceeds of up to $50,000,000. The shares would be sold to the investor at a slight discount to then-current market price of AgFeed common stock. The Company has no obligation to sell, nor does the investor have any right to force the Company to sell, to the investor any shares of its common stock at any time during the term of the agreement. Additionally, the Company is not prohibited from accessing other sources of financing at any time during the term of the agreement. Any decision to sell shares under this agreement will be made solely by the Company and its Board of Directors at the time of a proposed sale.

The Company also agreed to issue to the investor warrants to purchase 400,000 shares of its common stock at an exercise price of $5.75 per share. The warrants will be exercisable immediately after issuance, and have a term of five years. The warrants and any shares issued to the investor under the agreement or the warrant will be issued pursuant to the Company's existing shelf registration statement.

Dr. Songyan Li, AgFeed's Chairman, stated, "AgFeed has no immediate need for additional capital, nor current intention to access capital, through this financing tool or any other for the remainder of the calendar year. We believe that this agreement ensures our access to capital, on highly favorable terms, in support of the execution of our long term business plan through 2010 and beyond. This financing vehicle enables us to move forward on the implementation of our business plan from a position of strength, by providing us with access to capital without being exposed to the changing market conditions and terms, while at all times allowing us the flexibility to review other opportunities and control our own financing destiny."

President & CEO Mr. Junhong Xiong commented that, "We believe the global economy will continue to affect access to the capital markets over the next two to three years which would, in turn, impact our ability to execute our overall strategy. Accordingly, we, upon advice of our Board, working closely with our management and advisors, have taken a strong positive step to assure our ongoing access to capital."

This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities. There shall not be any sale of these securities in any jurisdiction in which such offering would be unlawful.

Participation in Global Investment Conference

AgFeed further announced that representatives from the Company will attend the Rodman & Renshaw Annual Global Investment Conference (Asia Track)at the New York Palace Hotel, 455 Madison Avenue, New York, NY 10022, where they are scheduled to present to investors at 10:25 a.m. on Thursday, September 10, 2009. Presenters for AgFeed include Mr. Ed Pazdro, financial reporting and management control consultant for AgFeed and Chief Financial Officer of AgFeed International Protein Technology Corp. ("AIPTC"), AgFeed's joint venture with M2P2 LLC.

Mr. Pazdro brings more than 25 years of financial expertise to AIPTC and AgFeed. For the past five years, he served as the Controller for PIC USA, Inc., a subsidiary of biotechnology leader Genus plc and international leader in providing genetically superior pig breeding stock and technical support for maximizing genetic potential to the global pork chain. Ed was responsible for PIC's financial management, financial reporting, tax and audit coordination, management of cash and internal controls. Additionally, he developed inventory valuation models for compliance with US generally accepted accounting principles and international accounting standards, including

agriculture-specific requirements for biological assets.

Mr. Pazdro possesses broad-based financial management experience gained at National Futures Association and global organizations including Tate & Lyle North America, Inc. and Gambro, Inc. Mr. Pazdro has been a Certified Public Accountant since 1981.


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