LightPath Technologies Announces Sale of Zhenjiang Subsidiary for $4.5M

What Happened
On July 23, 2026, LightPath Technologies, Inc. (LPTH) filed an 8-K to announce it entered into an equity transfer agreement to sell 100% of LightPath (Zhenjiang) Optical Instrumentation Co., Ltd. to Hengtu Optical Technology Co., Ltd. (the Purchaser) and Purchaser Representative Mr. Leo Zheng for total cash consideration of $4,500,000. The Purchaser is owned by Mr. Zheng and certain members of the Zhenjiang company’s current management team. LightPath also furnished a press release announcing the transaction.

Key Details

• Purchase price: $4,500,000 total, payable in full no later than the fifth anniversary of closing; minimum payments of $500,000 per year.
• Interest/penalties: financing interest equal to 4% of each installment; late payments incur 7% annual damages on overdue amounts.
• Post-closing rights: LightPath may designate an observer to Zhenjiang board/shareholder meetings during the “Restricted Period” (until full payment or five years).
• Transitional arrangements: limited trademark licenses and rights to use product drawings, tooling, molds, process documentation and technical support; LightPath retains ownership of its IP except as expressly licensed.
• Supply agreement: for five years after closing (“Exclusive Supply Term”), Zhenjiang will continue to supply products to LightPath at cost plus 10%; for each $1,000,000 of principal paid by the Purchaser, the markup increases 5% (e.g., $2M paid → cost +20%); upon full principal payment the price becomes fixed at cost plus 30%.
• Restrictions: during the Restricted Period and Exclusive Supply Term, the Purchaser agreed to certain limits on change of control, asset sales, and sales/marketing of specified products/territories.

Why It Matters
This is a divestiture of LightPath’s Zhenjiang operating subsidiary with a multi-year payment profile and transitional commercial and IP arrangements. Investors should note the relatively modest immediate cash inflow (payments spread over up to five years), continued commercial ties via the five-year supply and licensing terms, and contractual protections for LightPath (observer rights, post-closing restrictions, and IP retention). The company filed the full agreement (Exhibit 10.1) and a press release (Exhibit 99.1) with the Form 8-K.