The activities that the Company has engaged in include the following:
A subsidiary of the Company entered into an Investment Agreement with the Managing Committee of Mei County National Kiwi Fruit Wholesale Trading Center (the "Committee"). The Committee has been authorized by the People's Government of Mei County to be responsible for the construction and administration of the Mei County National Kiwi Fruit Wholesale Trading Center.
Under the Agreement, the parties agreed to invest and establish a kiwi fruit comprehensive deep processing zone and kiwi fruit and fruit-related materials trading zone in Yangjia Village, Changxing Town of Mei County with a total planned area of total planned area of 286 mu (approximately 47 acres).
Pursuant to the agreement, the Company will be responsible for the construction and financing of the project with a total investment of RMB 445.6 million (approximately $71.9 million) in buildings and equipment. In addition, the Company agreed to pay a fee for the land use rights for the project land in the amount of RMB 0.3 million per mu. The Committee is responsible for financing and constructing the basic infrastructure surrounding the project, such as the main water supply, main water drainage, natural gas, electricity, sewage, access roads to the project, natural gas and communications networks.
Mei County National Kiwi Fruit Wholesale Trading Center has started normal operations. There are a number of enterprises operating in the trading center including 12 express delivery companies, 4 logistic companies, four on-line sales companies, two packing companies and three agriculture companies. In addition, all government departments that are relevant to the operations of the Mei County National Kiwi Fruit Wholesale Trading Center have moved into the trading center. The Company is expected to have completed its investment in the trading center in the second quarter of 2017, and believes that it will generate income from the trading center through various means, such as maximizing its profit in the agriculture trading area.
As part of the Mei County National Kiwi Fruit Wholesale Trading Center project, the Company established Shaanxi Guo Wei Mei Kiwi Deep Processing Co., Ltd. to engage in the business of producing kiwi fruit juice, kiwi puree, cider beverages, and related products. The total estimated investment was RMB 294 million. The Company is also building fruit juice production lines, vegetable and fruit flash freeze facility, an R&D center and an office building. The Company plans to complete the construction in the second quarter of 2017.