Global Corn Group Limited — Capital/Financing Update 2016

Aug 8, 2016

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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Global Bio-chem Technology Group Company Limited 大成生化科技集團有限公司 *

(incorporated in the Cayman Islands with limited liability)

(Stock code: 00809)

Global Sweeteners Holdings Limited 大成糖業控股有限公司 *

(incorporated in the Cayman Islands with limited liability)

(Stock code: 03889)

MAJOR TRANSACTION

PROVISION OF FINANCIAL ASSISTANCE TO A SUPPLIER

As disclosed in the respective annual report of GBT and GSH for the year ended 31 December 2015, the management teams of GBT and GSH have been actively negotiating with BOC for the release of the Previous Supplier Guarantees. While BOC has expressed its intention to release the Guarantors from the Previous Supplier Guarantees by the end of 2016 subject to the obtaining of internal approval by BOC, to the best of the knowledge, information and belief of the GBT Directors and the GSH Directors after making reasonable enquiries, the internal approval has not yet been completed as at the date of this announcement.

The term of the Previous Supplier Loan will expire between August to November 2016. Based on the Supplier’s indication and the financial information of the Supplier available to GBT and GSH, the Supplier may not have sufficient financial resources to repay the Previous Supplier Loan upon the respective maturity dates. Under the Previous Supplier Guarantees, BOC shall have the right to demand the Guarantors or any of them to repay the Previous Supplier Loan if the Supplier is in default. To avoid immediate demand for full repayment of the Previous Supplier Loan by the Guarantors or any of them pursuant to the Previous Supplier Guarantee, the Supplier proposes to refinance the Previous Supplier Loan by entering into the New Supplier Loan Agreements with BOC for the New Supplier Loan. As a condition to the New Supplier Loan, BOC has requested each of the Guarantors to enter into the New Supplier Guarantees to severally guarantee the obligations of the Supplier under the New Supplier Loan.

As the applicable percentage ratios in respect of each of the New Supplier Guarantees exceeded 25%, the New Supplier Guarantees constitute a major transaction of GBT and GSH and is therefore subject to the notification, announcement and shareholders’ approval requirements under the Listing Rules.

• For identification purposes only

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A circular containing, among other things, further details of the New Supplier Guarantees together with a notice convening the GBT EGM, will be despatched by GBT to the GBT Shareholders on or before 29 August 2016.

A circular containing, among other things, further details of the GSH New Supplier Guarantee together with a notice convening the GSH EGM, will be despatched by GSH to the GSH Shareholders on or before 29 August 2016.

BACkGROUNd

As disclosed in the respective annual report of GBT and GSH for the year ended 31 December 2015, the management teams of GBT and GSH have been actively negotiating with BOC for the release of the Previous Supplier Guarantees. While BOC has expressed its intention to release the Guarantors from the Previous Supplier Guarantees by the end of 2016 subject to the obtaining of internal approval by BOC, to the best of the knowledge, information and belief of the GBT Directors and the GSH Directors after making reasonable enquiries, the internal approval has not yet been completed as at the date of this announcement.

The term of the Previous Supplier Loan will expire between August to November 2016. Based on the Supplier’s indication and the financial information of the Supplier available to GBT and GSH, the Supplier may not have sufficient financial resources to repay the Previous Supplier Loan upon the respective maturity dates. Under the Previous Supplier Guarantees, BOC shall have the right to demand the Guarantors or any of them to repay the Previous Supplier Loan if the Supplier is in default. To avoid immediate demand for full repayment of the Previous Supplier Loan by the Guarantors or any of them pursuant to the Previous Supplier Guarantee, the Supplier proposes to refinance the Previous Supplier Loan by entering into New Supplier Loan Agreements with BOC for the New Supplier Loan. As a condition to the New Supplier Loan, BOC has requested each of the Guarantors to enter into the New Supplier Guarantees to severally guarantee the obligations of the Supplier under the New Supplier Loan.

Set out below are the principal terms of the New Supplier Loan Agreements:

Name of bank: BOC Borrower: The Supplier Loan principal: RMB2.49 billion Term of loan: 12 months from the respective date of drawdown

Rate of interest: 0.10% below the benchmark lending rate on the business day immediately before the respective date of signing of the New Supplier Loan Agreements, payable on a quarterly basis

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Use of the loan proceeds:

Refinancing of the Previous Supplier Loan

Events of default:

There shall be an event of default if, among others, any of the following events shall have occurred or is continuing:

• (i) the Supplier fails to pay any sums when due in accordance with the terms of the New Supplier Loan Agreements;

• (ii) the Supplier fails to use the New Supplier Loan for the purpose set out in the New Supplier Loan Agreements;

• (iii) any of the representations or warranties by the Supplier have been untrue or incorrect or the Supplier fails to duly perform or observe any of its obligations under the New Supplier Loan Agreements;

• (iv) the creditability, profitability, ability of repayment, operational status or cash flow of the Supplier has become worsen;

• (v) the breach by the Supplier of any contract entered into with affiliates of BOC or any facility agreements entered into with other financial institutions;

• (vi) the breach of New Supplier Guarantees by any of the Guarantors;

• (vii) the termination of operation, dissolution or winding up of the Supplier.

Upon the occurrence of an event of default, BOC shall have the right to declare all outstanding indebtedness under the New Supplier Loan Agreements to be forthwith due and payable and shall have the right to demand the Guarantors to perform their guarantee obligations under the New Supplier Guarantees.

Security (other than the New Supplier Guarantees):

Nil

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The terms of the New Supplier Guarantees are substantially the same as the Previous Supplier Guarantees. Details of the New Supplier Guarantees are as follows:

Name of bank: BOC Guarantors: (i) Changchun Baocheng (ii) Changchun Dacheng Bio-tech (iii) Changchun Dahe (iv) Changchun Dihao (v) Changchun GBT Guaranteed Amount: All indebtedness due and owing to BOC pursuant to any loan agreements or other documents signed by the Supplier within nine months from, whichever is the later, the date of the GBT EGM or the GSH EGM and the maximum principal amount guaranteed under the New Supplier Guarantees shall be RMB2.5 billion. Date of expiry of the guarantee: Two years from the respective expiry of term of the New Supplier Loan Agreements

None of the GBT Guarantors and the GSH Guarantors receives, or will receive, any fee or commission for entering into the New Supplier Guarantees.

Information about the Supplier and BOC

The principal business of the Supplier is the purchase of corn kernels from local farmers in Changchun and other regions of the Jilin Province and the resale thereof to end users in the northeast provinces in the PRC.

The Supplier is beneficially majority-owned by the Labour Union, being the labour union of the PRC employees of the Group. To the best of the knowledge, information and belief of the GBT Directors and the GSH Directors having made all reasonable enquiries, save that (i) the Supplier is the supplier of the GBT Group/the Group of corn kernels, and (ii) the ultimate beneficial owner of the Supplier includes the labour union of the PRC employees of the Group, the Supplier and its ultimate beneficial owners are third parties independent of GBT, GSH and their respective connected persons, and the business and operations are separately managed by its owned management team, independent from that of the Group.

Based on the unaudited financial statements provided by the Supplier, the Supplier has a negative net asset value of approximately RMB53 million as of 31 December 2015 and a net loss after taxation of approximately RMB136 million for the year ended 31 December 2015.

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To the best of the knowledge, information and belief of the GBT Directors and the GSH Directors having made all reasonable enquiries, save that BOC is one of the principal banks of the Group and GBT’s controlling shareholders, BOC and its ultimate beneficial owners are third parties independent of GBT, GSH and their connected persons of GSH. BOC is principally engaged in the provision of banking services.

Information of the GBT Group and GSH Group

The GBT Group is principally engaged in the manufacture and sale of corn refined products and corn based biochemical products.

The GSH Group is principally engaged in the manufacture and sale of corn refined products and corn based sweetener products.

Reason for entering into of the New Supplier Guarantees

For the reason set out in the paragraph headed “Reason for entering into of the Supplier Guarantees” in the 2015 Announcements, the Guarantors entered into the Previous Suppliers Guarantees.

As set out in the paragraph headed “Background” above, in order for the Supplier to obtain the New Supplier Loan for refinance of the Previous Supplier Loan so that the Guarantors would not be called upon to repay the Previous Supplier Loan pursuant to the Previous Supplier Guarantees, the Guarantors are required to enter into the New Supplier Guarantees.

The GBT Board and the GSH Board consider that given the inability of the Supplier to repay the Previous Supplier Loan, should the Guarantors refuse to enter into the New Supplier Guarantees which result in the Supplier’s failure to refinance the Previous Supplier Loan, BOC may enforce the Previous Supplier Guarantees. The entering into of the New Supplier Guarantees could facilitate the obtaining of the New Supplier Loan by the Supplier and therefore could avoid immediate demand for full repayment of the Previous Supplier Loan by the Guarantors or any of them pursuant to the Previous Supplier Guarantee. As such, the GBT Board and the GSH Board believe that the terms of the New Supplier Guarantees are fair and reasonable and in the interests of the GBT Shareholders and GSH Shareholders as a whole.

As at 31 December 2015, the aggregate net current liabilities of the GBT Guarantors amounted to approximately HK$4,211 million, while the net current liabilities of the GSH Guarantor amounted to approximately HK$286 million. On the other hand, both the Group (including the GSH Group) and the GSH Group were in consolidated net current liabilities position, with consolidated net current liabilities as at 31 December 2015 of approximately HK$2,501.2 million and HK$128.0 million, respectively. The consolidated cash and cash equivalent of each of the Group (including the GSH Group) and the GSH Group as at 31 December 2015 amounted to approximately HK$1,567.4 million and HK$61.1 million, respectively.

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As such, if the Supplier fails to repay and/or refinance the Previous Supplier Loan and all or any of the Guarantors are demanded for immediate repayment of the Previous Supplier Loan pursuant to the Previous Supplier Loan Agreement, the Guarantors may not have sufficient resources to repay the indebtedness under the Previous Supplier Guarantees, and the GBT Group and the GSH Group may not have sufficient resources and liquidity to provide financial assistance to these Guarantors. If such circumstances arise, these Guarantors may need to dispose of all or any of their assets and/or their respective businesses in order to satisfy the Previous Supplier Loan, failing which may result in the liquidation of these Guarantors. The Guarantors are five of the principle operating members of the Group and in aggregate contributed to approximately 27.2% of the Group’s total revenue for the year ended 31 December 2015. The GSH Guarantor was one of the principle operating members of the GSH Group and contributed only to approximately 0.2% of the GSH Group’s total revenue for the year ended 31 December 2015 due to suspension of operation. Any disposal of the material assets and/or businesses of, or the liquidation of, any of these Guarantors may have significant adverse impact on the business and operational performance of the GBT Group or, as the case may be, the GSH Group.

Each of GBT and GSH has also provided intra-group corporate guarantees in respect of the other banking facilities of the GBT Guarantors and the GSH Guarantor, respectively. As at 31 December 2015, the outstanding amount of the banking facilities of the GBT Guarantors guaranteed by GBT amounted to approximately RMB5,203,700,000, while the outstanding amount of the banking facilities of the GSH Guarantor guaranteed by GSH amounted to approximately RMB180,000,000. If any of these Guarantors is demanded but fails to repay the Previous Supplier Loan pursuant to the Previous Supplier Guarantees, or any of them is forced to dispose of its material assets or businesses or is forced to go liquidation, GBT or, as the case may be, GSH may be demanded by all or any of the banks for immediate repayment of these banking facilities. If GBT or, as the case may be, GSH, does not have sufficient resources to repay the indebtedness under these corporate guarantees, it may need to raise further financing or otherwise dispose of its other assets or businesses in order to honour its obligations under these corporate guarantees. There is no assurance that GBT or (as the case may be) GSH may be able to raise sufficient funds for honouring these corporate guarantees. Any disposal by GBT or (as the case may be) GSH of its principal operating assets and/or business may have significant adverse impact on the business and operational performance of the GBT Group or, as the case may be, the GSH Group.

The GBT Board and the GSH Board believe that, by entering into the New Supplier Guarantees, BOC would not enforce the Previous Supplier Guarantees instantly. In the meantime, the Group will continue to actively negotiate with BOC to reach an agreement for better and long-term solution. The Group will also strive to strengthen its cash position by, among others, debt restructuring and/or seeking financial or other support from the ultimate controlling shareholder of GBT.

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Listing Rules implications

As the applicable percentage ratios in respect of each of the New Supplier Guarantees exceeded 25%, the New Supplier Guarantees constitute a major transaction of GBT and GSH and is therefore subject to the notification, announcement and shareholders’ approval requirements under the Listing Rules.

A circular containing, among other things, further details of the New Supplier Guarantees together with a notice convening the GBT EGM, will be despatched by GBT to the GBT Shareholders on or before 29 August 2016.

A circular containing, among other things, further details of the GSH New Supplier Guarantee together with a notice convening the GSH EGM, will be despatched by GSH to the GSH Shareholders on or before 29 August 2016.

dEFINITIONS

Unless the context otherwise requires, the following terms shall have the meanings set out below:

“2015 Announcements”	the announcements made by GBT and GSH dated 31 March 2015 in
	relation to, among others, the Previous Supplier Guarantees
“BOC”	中國銀行股份有限公司偉峰國際支行(Bank of China Weifeng
	International Branch)
“Changchun Baocheng”	長春寶成生化發展有限公司(Changchun Baocheng Bio-chem
	Development Co., Ltd.), a sino-foreign enterprise established in the
	PRC and an indirect wholly owned subsidiary of GBT
“Changchun Dacheng	長春大成生物科技開發有限公司(Changchun Dacheng Bio-tech
Bio-tech”	Development Co., Ltd.), a sino-foreign enterprise established in the
	PRC and an indirect wholly owned subsidiary of GBT
“Changchun Dahe”	長春大合生物技術開發有限公司(Changchun Dahe Bio Technology
	Development Co., Ltd.), a wholly foreign owned enterprise
	established in the PRC and an indirect wholly owned subsidiary of
	GBT
“Changchun Dihao”	長春帝豪食品發展有限公司(Changchun Dihao Foodstuff
	Development Co., Ltd.), a wholly foreign owned enterprise
	established in the PRC and an indirect wholly owned subsidiary of
	GSH

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“Changchun GBT”

長春金寶特生物化工有限公司 (Changchun GBT Bio-Chemical Co., Ltd.), a sino-foreign enterprise established in the PRC and an indirect wholly owned subsidiary of GBT

• “GBT” Global Bio-chem Technology Group Company Limited, a company incorporated in the Cayman Islands and the issued shares of which are listed on the Stock Exchange

• “GBT Board”

• the board of directors of GBT

• “GBT Directors” the directors of GBT

• “GBT EGM” an extraordinary general meeting of GBT to be convened and held to consider and, if thought fit, approve the New Supplier Guarantees and the transactions contemplated thereunder

• “GBT Group” GBT and its subsidiaries which, for the purpose of this announcement, excludes the GSH Group

• “GBT Guarantors” Changchun Baocheng, Changchun Dacheng Bio-tech, Changchun Dahe, Changchun GBT or either of them

• “GBT New Supplier the various guarantees to be executed by each of the GBT Guarantors Guarantees” for the benefit of the Supplier

• “GBT Shareholders” the shareholders of GBT

• “Group” the GBT Group and the GSH Group

• “GSH” Global Sweeteners Holdings Limited, a company incorporated in the Cayman Islands and the issued shares of which are listed on the Stock Exchange

• “GSH Board” the board of directors of GSH

• “GSH Directors” the directors of GSH

• “GSH EGM” an extraordinary general meeting of GSH to be convened and held to consider and, if thought fit, approve the GSH New Supplier Guarantee and the transactions contemplated thereunder

• “GSH Group” GSH and its subsidiaries

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“GSH Guarantor” Changchun Dihao

• “GSH New Supplier the guarantee to be executed by the GSH Guarantor for the benefit Guarantee” of the Supplier

• “GSH Shareholders” the shareholders of GSH

• “Guarantors” the GBT Guarantors and the GSH Guarantor

• “HK$” Hong Kong dollars, the lawful currency of Hong Kong

• “Hong Kong” the Hong Kong Special Administrative Region of the PRC

• “Independent Third Party” a person or an entity which, to the best of the respective GBT Directors’ and GSH Directors’ knowledge, information and belief having made all reasonable enquiry, that it and its ultimate beneficial owners (in the case of an entity) are third parties independent of GBT, GSH and their respective connected persons

• “Labour Union” the labour union of the PRC employees of the Group

• “Listing Rules” Rules Governing the Listing of Securities on the Stock Exchange

• “New Supplier Guarantees” the GBT New Supplier Guarantees and the GSH New Supplier Guarantee

• “New Supplier Loan” all indebtedness due and owing to BOC pursuant to any loan agreements or other documents signed or to be signed by the Supplier within nine months from, whichever is the later, the date of the GBT EGM or the GSH EGM

• “New Supplier Loan the loan agreement(s) to be entered into between the Supplier and Agreement(s)” BOC in relation to the New Supplier Loan

• “PRC” People’s Republic of China

• “Previous Supplier the various guarantees given by each of the Guarantors for the Guarantees” benefit of the Supplier as disclosed in the 2015 Announcements

• “Previous Supplier Loan” the loan advanced by BOC to the Supplier under the Previous Supplier Loan Agreements with an aggregate principal amount of RMB2.49 billion

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“Previous Supplier Loan various loan agreements entered into between the Supplier and BOC Agreements” in 2014 and 2015 “RMB” Renminbi, the lawful currency in the PRC “Stock Exchange” The Stock Exchange of Hong Kong Limited “Supplier” 長春大金倉玉米收儲有限公司 (Changchun Dajincang Corn Procurement Co., Ltd.), a sino-foreign enterprise established in the PRC which is beneficially owned by the Labour Union as to approximately 98.91% and an Independent Third Party as to approximately 1.09%

By order of the GBT Board By order of the GSH Board Global Bio-chem Technology Group Global Sweeteners Holdings Limited Company Limited Wang Jian Wang Qiu Chairman Chairman

Hong Kong, 8 August 2016

As at the date of this announcement, the GBT Board comprises three executive directors, namely, Ms. Wang Qiu, Mr. Wang Jian and Mr. Li Shuguang; two non-executive directors, namely, Mr. Qiu Zhuang and Mr. Xing Lizhu; and three independent non-executive directors, namely, Mr. Ng Kwok Pong, Mr. Yeung Kit Lam and Ms. Chiu Lai Ling Shirley.

As at the date of this announcement, the GSH Board comprises two executive directors, namely, Mr. Wang Jian and Mr. Kong Zhanpeng; two non-executive directors, namely, Mr. Fu Qiang and Ms. Zhang Yaohui; and three independent non-executive directors, namely, Mr. Ho Lic Ki, Mr. Lo Kwing Yu and Mr. Yuen Tsz Chun.

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