Global Corn Group Limited — Proxy Solicitation & Information Statement 2018

Dec 3, 2018

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other licensed securities dealer, bank manager, solicitor, professional accountant or other professional advisers.

If you have sold or transferred all your shares in Global Sweeteners Holdings Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser(s) or the transferee(s) or to the bank, stockbroker or licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or the transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, 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 circular.

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 DAJINCANG AND NOTICE OF EGM

A notice convening the EGM to be held on Friday, 21 December 2018 at 10:30 a.m. at Room 1, United Conference Centre, 10/F., United Centre, 95 Queensway, Admiralty, Hong Kong is set out on pages 32 to 33 of this circular. A form of proxy for use at the EGM is also enclosed with this circular.

Whether or not you intend to attend the EGM, you are advised to read the notice of EGM and complete and return the enclosed form of proxy in accordance with the instructions printed thereon to the Hong Kong branch share registrar and transfer office of the Company, Tricor Investor Services Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong as soon as possible and in any event not later than 48 hours before the time appointed for the holding of the EGM (i.e. at or before 10:30 a.m. on Wednesday, 19 December 2018 (Hong Kong time)) or any adjournment thereof. Completion and delivery of the form of proxy will not preclude you from attending and voting in person at the EGM should you so wish.

3 December 2018

* for identification purposes only

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
Appendix I — Financial Information of the Group. . . . . . . . . . . . . . . . . . . . .	20
Appendix II — General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	25
Notice of EGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	32

— i —

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions have the following meanings:

• “2017 Circulars”

the circulars made by GBT dated 29 December 2017 and the Company dated 17 January 2018 in relation to, among others, the Previous Supplier Guarantees

• “Acquisition”

acquisition by the GBT Group and the disposal by the Group of the entire equity interest in Dihao Foodstuff and Dihao Crystal Sugar

• “Associate(s)”

• has the meaning ascribed to it under the Listing Rules

• “Board”

• the board of Directors

• “BOC”

• 中國銀行股份有限公司偉峰國際支行 (Bank of China Weifeng International Branch)

• “Business Day”

• a day on which banks are generally open for business in Hong Kong and the PRC (other than a Saturday, Sunday or a public holiday or a day on which a tropical cyclone warning No. 8 or above or a “black” rainstorm warning signal is or remains hoisted in Hong Kong at any time between 9:00 a.m. and 5:00 p.m.)

• “BVI”

• the British Virgin Islands

• “Changchun Baocheng”

• 長春寶成生化發展有限公司 (Changchun Baocheng Biochem Development Co., Ltd.*), a sino-foreign enterprise established in the PRC and an indirect wholly owned subsidiary of GBT

• “Changchun Dacheng Bio-tech”

• 長春大成生物科技開發有限公司 (Changchun Dacheng Biotech 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

— 1 —

DEFINITIONS

• “Changchun GBT”

• “Company”

• “Completion”

• “Dajincang”

• “Dihao Crystal Sugar”

• “Dihao Foodstuff”

• “Dihao Guarantor”

• “Dihao New Supplier Guarantee”

• “Dihao Previous Supplier Guarantee”

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

• Global Sweeteners Holdings Limited, a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the main board of the Stock Exchange (stock code: 03889)

• completion of the Acquisition

• 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

• 長春帝豪結晶糖開發實業有限公司 (Changchun Dihao Crystal Sugar Industry Development Co., Ltd.*), a wholly foreign owned enterprise established in the PRC and an indirect wholly owned subsidiary of the Company prior to the Completion, and an indirect wholly owned subsidiary of GBT after the Completion

• 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 the Company prior to the Completion, and an indirect wholly owned subsidiary of GBT after the Completion

Dihao Foodstuff

• the guarantee to be executed by the Dihao Guarantor in favour of BOC in respect of the New Supplier Loan

• the guarantee given by the Dihao Guarantor for the benefit of Dajincang as disclosed in the 2017 Circulars

— 2 —

DEFINITIONS

• “Director(s)”

• director(s) of the Company

• “EGM”

the extraordinary general meeting of the Company to be convened and held at 10:30 a.m. on Friday, 21 December 2018 at Room 1, United Conference Centre, 10/F., United Centre, 95 Queensway, Admiralty, Hong Kong, the notice of which is set out on pages 32 to 33 of this circular, and any adjournment thereof for the purpose of considering and, if thought fit, approving (among other matters) the Dihao New Supplier Guarantee and the transactions contemplated thereunder

• “GBT”

• Global Bio-chem Technology Group Company Limited, a company incorporated in the Cayman Islands, the shares of which are listed on the main board of the Stock Exchange (stock code: 00809) and the controlling shareholder of the Company

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

• “GBT Group” GBT and its subsidiaries which, for the purpose of this circular, exclude the Group

• “GBT Guarantors”

• Changchun Baocheng, Changchun Dacheng Bio-tech, Changchun Dahe, Changchun GBT or any of them

• “GBT New Supplier Guarantees”

• the various guarantees to be executed by each of the GBT Guarantors in favour of BOC in respect of the New Supplier Loan

• “Group”

• the Company and its subsidiaries

• “Guarantors”

• the GBT Guarantors and the Dihao Guarantor

• “HK$”

• Hong Kong dollars, the lawful currency of Hong Kong

• “Hong Kong”

• the Hong Kong Special Administrative Region of the PRC

— 3 —

DEFINITIONS

• “Independent Third Party” a person or an entity which, to the best of the respective 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 the Company and their respective connected persons

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

• “Latest Practicable Date” 28 November 2018, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained in this circular

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

• “Modern Agricultural” Modern Agricultural Industry Investment Limited, a company incorporated in the BVI which is the controlling shareholder of GBT as at the Latest Practicable Date

• “MT” metric tonnes

• “mpta” metric tonnes per annum

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

• “New Supplier Loan” all indebtedness due and owing to BOC pursuant to the New Supplier Loan Agreement(s)

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

• “Nongtou”

吉林省農業投資集團有限公司 (Jilin Agricultural Investment Group Co., Ltd.), a company established in the PRC which is controlled by SASAC of Jilin Province

— 4 —

DEFINITIONS

• “PRC” the People’s Republic of China which, for the purpose of this circular, excludes Hong Kong, the Macau Special Administrative Region and Taiwan

• “Previous Supplier the various guarantees given by each of the Guarantors in Guarantees” favour of BOC in respect of the Previous Supplier Loan as disclosed in the 2017 Circulars

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

• “Previous Supplier Loan various loan agreements entered into between Dajincang and Agreements” BOC in 2017 and 2018

• “RMB” Renminbi, the lawful currency of the PRC

• “S&P Agreement” the agreement dated 21 July 2017 entered into between the GBT Group and the Group in relation to the Acquisition

• “SASAC of Jilin Province” 吉林省人民政府國有資產監督管理委員會 (State-owned Assets Supervision & Administration Commission of the People’s Government of Jilin Province)

• “SFO” Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) as amended from time to time

• “Share(s)” ordinary share(s) of HK$0.10 each in the share capital of the Company

• “Shareholder(s)” the shareholders of the Company

• “Stock Exchange” The Stock Exchange of Hong Kong Limited

• “%” per cent.

— 5 —

LETTER FROM THE BOARD

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)

Executive Directors: Mr. Kong Zhanpeng Mr. Zhang Zihua

Independent non-executive Directors: Mr. Ho Lic Ki Mr. Lo Kwing Yu Mr. Yuen Tsz Chun

Registered office: Cricket Square Hutchins Drive PO Box 2681 Grand Cayman KYl-1111 Cayman Islands

Head Office and Principal Place of Business in Hong Kong: Suites 2202-4, 22nd Floor Tower 6, the Gateway 9 Canton Road Tsimshatsui, Kowloon, Hong Kong

3 December 2018

To the Shareholders

Dear Sir or Madam,

MAJOR TRANSACTION PROVISION OF FINANCIAL ASSISTANCE TO DAJINCANG

1. INTRODUCTION

Reference is made to the joint announcement of GBT and the Company dated 6 November 2018 in relation to the proposed entering into of the New Supplier Guarantees.

• for identification purposes only

— 6 —

LETTER FROM THE BOARD

The purpose of this circular is to provide you with information regarding the resolution to be proposed at the EGM to approve the Dihao New Supplier Guarantee.

2. DIHAO NEW SUPPLIER GUARANTEE

As disclosed in the respective interim reports of GBT and the Company for the six months ended 30 June 2018, the management of the Group has continued to negotiate with BOC to find solutions to relieve the Group from its obligations under the Previous Supplier Guarantees, and has continued to explore other alternatives in case Dajincang fails to repay the Previous Supplier Loan, in the event of which will trigger the Group’s obligations as guarantor pursuant to the Previous Supplier Guarantees. On 26 March 2018, Mr. Yuan Weisen, the Chairman of GBT, met with the representatives of Bank of China Jilin Province Branch on behalf of the Group and on 2 April 2018, a revised debt-equity swap proposal was submitted to Bank of China Jilin Province Branch for their consideration. Subsequently, the Group, the GBT Group and Bank of China Jilin Province Branch have also explored other possibilities to lower the debt ratio of the Group, the GBT Group and Dajincang and a further revised debt-equity swap proposal has been approved by Bank of China Jilin Province Branch and was further submitted to the People’s Government of Jilin Province in August 2018 for their consideration. However, while the management of the Group is awaiting for the approval by People’s Government of Jilin Province, the terms of the Previous Supplier Loan Agreements will expire in December 2018. Based on Dajincang’s indication and the financial information of Dajincang available to GBT and the Company, Dajincang still does not have sufficient financial resources to repay the Previous Supplier Loan when the same falls due. 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 Dajincang 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 Guarantees, Dajincang 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 Dajincang under the New Supplier Loan.

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

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

— 7 —

LETTER FROM THE BOARD

Rate of interest:

39.5 basis points below the Loan Prime Rate quoted by the National Interbank Funding Center on the business day immediately before the respective date of signing of the New Supplier Loan Agreements, payable on a quarterly basis

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

• (ii) Dajincang 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 Dajincang has been untrue or incorrect or Dajincang 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 Dajincang have become worsened;

• (v) the breach by Dajincang 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; and

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

— 8 —

LETTER FROM THE BOARD

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 Dajincang shall pledge its receivables in favour of Supplier Guarantees): BOC

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

Name of bank: BOC

Guarantor: Dihao Foodstuff

Guaranteed amount: All indebtedness due and owing to BOC pursuant to the New Supplier Loan Agreements and the maximum principal amount guaranteed under the Dihao New Supplier Guarantee shall be RMB2.5 billion.

Date of expiry of the 12 months from the date of the Dihao New Supplier guarantee: Guarantee

On 21 July 2017, the Group entered into the S&P Agreement with the GBT Group, for the sale of the entire equity interest in Dihao Foodstuff and Dihao Crystal Sugar. Dihao Foodstuff is the only member of the Group which was involved in the Dihao Previous Supplier Guarantee, and is the only member of the Group which is required to be entered into the Dihao New Supplier Guarantee. Upon Completion, Dihao Foodstuff will cease to be a member of the Group and as such, the Group will cease to be involved in, nor have any liabilities arising from the Dihao Previous Supplier Guarantee and/or the Dihao New Supplier Guarantee. The Disposal is yet to be completed as at the Latest Practicable Date, but the Completion is expected to take place on or before 31 December 2018.

— 9 —

LETTER FROM THE BOARD

The Dihao Guarantor does not receive, and will not receive, any fee or commission for entering into the Dihao New Supplier Guarantee. The reason that the Dihao Guarantor will not charge any fee or commission for providing the Dihao New Supplier Guarantee is because Dajincang is in financial difficulties, and Dajincang does not have the financial capability to pay any fee or commission to the Dihao Guarantor. In addition, according to the advice of the PRC legal advisors of the Group, as provision of financial guarantees is not within the business scope of the Dihao Guarantor, the Dihao Guarantor is not allowed to charge any fee or commission from Dajincang for providing the Dihao New Supplier Guarantee under the laws and regulations of the PRC.

Furthermore, as set out in the paragraph headed “Reasons for Entering into of the Dihao New Supplier Guarantee” below, the Company has taken or will take steps and controls to control risks and/or reduce liabilities of the Group under the Dihao New Supplier Guarantee.

Reasons for Entering into of the Dihao New Supplier Guarantee

For the reasons set out in the paragraph headed “Reasons for Entering into of the New Supplier Guarantees” or “Reasons for Entering into of the Dihao New Supplier Guarantee” in the 2017 Circulars, the Guarantors entered into the Previous Supplier Guarantees.

As at the Latest Practicable Date, Dajincang had not made any repayment under the Previous Supplier Loan, and the amount of indebtedness due and owing to BOC by Dajincang amounted to approximately RMB2.49 billion. According to the unaudited financial statements of Dajincang, Dajincang had a negative net asset value as at 30 June 2018.

As mentioned above, in order for Dajincang to obtain the New Supplier Loan for the 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.

— 10 —

LETTER FROM THE BOARD

The Directors consider that given the inability of Dajincang to repay the Previous Supplier Loan, Dajincang must refinance the Previous Supplier Loan by entering into the New Supplier Loan. Should the Dihao Guarantor refuses to enter into the Dihao New Supplier Guarantee, which is a condition to the New Supplier Loan, Dajincang will not be able to finance the Previous Supplier Loan and BOC may enforce the Dihao Previous Supplier Guarantee. The entering into of the Dihao New Supplier Guarantee could therefore avoid immediate demand for full repayment of the Previous Supplier Loan by the Dihao Guarantor pursuant to the Dihao Previous Supplier Guarantee. As such, the Board believes that the terms of the Dihao New Supplier Guarantee are fair and reasonable and in the interests of the Shareholders as a whole.

As at 30 June 2018, the net current liabilities of the Dihao Guarantor amounted to approximately HK$833.6 million. On the other hand, the Group was in consolidated net current liabilities position, with consolidated net current liabilities as at 30 June 2018 of approximately HK$1,017.0 million. The consolidated cash and cash equivalent of the Group as at 30 June 2018 amounted to approximately HK$116.6 million.

As such, if Dajincang 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 Agreements, the Dihao Guarantor may not have sufficient resources to repay the indebtedness under the Dihao Previous Supplier Guarantee, and the Group may not have sufficient resources and liquidity to provide financial assistance to the Dihao Guarantor. If such circumstances arise, the Dihao Guarantor may need to dispose of all or some of its assets and/or its businesses in order to satisfy the Previous Supplier Loan, failing which may result in the liquidation of the Dihao Guarantor.

Under Hong Kong Financial Reporting Standard (“ HKFRS ”) 9, the Group should initially recognise the financial guarantee contracts at fair value and subsequently measure it at the higher of (a) the amount determined in accordance with Hong Kong Accounting Standard (“ HKAS ”) 37 and (b) the amount initially recognised less cumulative amortisation recognised in accordance with HKFRS 15. Therefore, it is estimated that by entering into the Dihao New Supplier Guarantee, the total liabilities of the Group will increase accordingly.

— 11 —

LETTER FROM THE BOARD

Set out below is further information of the Dihao Guarantor and its share in (prior to the Completion) the Group’s total asset value and negative net asset value as of 30 June 2018:

			Percentage of
		Percentage of	share of Dihao
		share of Dihao	Guarantor
		Guarantor	in terms of
		in terms of total	negative net
		asset value of	asset value of
	Current business and business	the Group	the Group
Name of Dihao	development plan (if any)	(prior to the	(prior to the
Guarantor	of the Dihao Guarantor	Completion)	Completion)
Dihao	Manufacture and sale of corn starch,	82.4%	176.6%
Foodstuff	other corn refined products and corn
	based sweeteners products

Due to the lackluster performance of the upstream business of the Group, the production facilities of Dihao Foodstuff for production of corn starch and other corn refined products have been suspended since April 2014. The relocation of the downstream production facilities for 60,000 mtpa glucose/maltose and 30,000 mtpa maltodextrin of Dihao Foodstuff to Xinglongshan, Changchun has been completed. It is expected that the relocation of other production facilities of Dihao Foodstuff to Xinglongshan, Changchun will be completed in the first quarter of 2020

— 12 —

LETTER FROM THE BOARD

The Group has also provided intra-group corporate guarantees in respect of the other banking facilities of the Dihao Guarantor. As at 30 June 2018, the outstanding amount of the banking facilities of the Dihao Guarantor guaranteed by the Company amounted to approximately RMB180.0 million. If the Dihao Guarantor is demanded but fails to repay the Previous Supplier Loan pursuant to the Dihao Previous Supplier Guarantee, or the Dihao Guarantor is forced to dispose of its material assets or businesses or is forced to go into liquidation, the Group may be demanded by all or any of the banks for immediate repayment of these banking facilities. If the Group 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 the Group will be able to raise sufficient funds for honouring these corporate guarantees. Any disposal by the Group of its principal operating assets and/or businesses may have significant adverse impact on the business and operational performance of the Group.

The Board believes that, by entering into the Dihao New Supplier Guarantee, BOC would not enforce the Dihao Previous Supplier Guarantee immediately. To control risks and/or to reduce liabilities of the Group under the Dihao Previous Supplier Guarantee and (as applicable) the Dihao New Supplier Guarantee, the Group has taken or will take the following steps and controls:

• (i) the management team of the Company has been in active negotiations with BOC for the release of the Dihao Previous Supplier Guarantee;

• (ii) to the best of the knowledge, information and belief of the Directors after making reasonable enquiries, Dajincang is undergoing restructuring including but not limited to the injection of new capital which is expected to enable Dajincang to resume normal operation and generate positive cash flow. In addition, in order to expedite the process of repaying the New Supplier Loan, Dajincang has also been facilitating the restructuring of its business and has submitted a business plan to the Company to revive its business so that it may generate positive cash flow;

• (iii) in addition to the above, to manage the risks of providing the Dihao New Supplier Guarantee, while BOC has been closely monitoring every monetary transaction made by Dajincang, the Group, the GBT Group and the controlling shareholder of GBT, Nongtou, have appointed personnel to monitor the daily operations of Dajincang;

— 13 —

LETTER FROM THE BOARD

• (iv) the management team of the Company will enter into an agreement with Dajincang and will closely monitor the terms of the Dihao New Supplier Guarantee to ensure that there will be no further increase in the amount to be guaranteed by the Group;

• (v) the management team of the Company will monitor the terms of the New Supplier Loan Agreements, and will ensure that the loan drawn by Dajincang under the New Supplier Loan Agreements will be utilised by Dajincang for refinancing of the Previous Supplier Loan;

• (vi) the management team of the Company will actively negotiate with Dajincang on steps to procure Dajincang to repay the Previous Supplier Loan or (as applicable) the New Supplier Loan, and steps to facilitate the restructuring of Dajincang;

• (vii) the Acquisition is yet to be completed as at the Latest Practicable Date, but the Completion is expected to take place on or before 31 December 2018. Upon the Completion, Dihao Foodstuff will cease to be a member of the Group and the Group will then cease to be involved in the Dihao New Supplier Guarantee; and

• (viii) the Group will strive to strengthen its financial position by, among others, debt restructuring and/or seeking financial or other support from the controlling shareholder of GBT.

Shareholders should however note that the New Supplier Loan Agreements are subject to internal approval of BOC. If BOC does not agree to enter into the New Supplier Loan Agreements, the Dihao New Supplier Guarantee will not be entered into by the Dihao Guarantor notwithstanding the approval by the shareholders of GBT and the Company, and BOC may enforce the Dihao Previous Supplier Guarantee.

In addition, Shareholders should also note that whether the Dihao Previous Supplier Guarantee can be subsequently released and discharged will depend on, among others, the progress and outcome of negotiations between Dajincang and BOC. Based on the communications between the Group and BOC, the release and/ or the discharge of the Dihao Previous Supplier Guarantee or (as applicable) the Dihao New Supplier Guarantee will depend on the financial viability of Dajincang and its ability to generate healthy cash flow. To the best knowledge, information and belief of the Directors after making reasonable enquiries, as part of the restructuring of Dajincang, its investment capital has been increased by US$26.2 million in June 2018

— 14 —

LETTER FROM THE BOARD

and the restructuring of Dajincang is still ongoing. According to the business plan of Dajincang, it will gradually revive its operation after the restructuring. It is expected that more time is needed for Dajincang to materialise its business plan by the end of 2019. To the best knowledge of the Board, the expected time for resumption of operations of Dajincang has been delayed due to the lack of operating cashflow of Dajincang and the tightening of credit policy of the PRC banks. Nevertheless, it is expected that should Dajincang resume its operations, Dajincang may have the ability to release the Group from the Dihao Previous Supplier Guarantee, or as the case may be, the Dihao New Supplier Guarantee by replacing such with guarantees to be given by members of the group of Dajincang.

To recapitulate, despite the delay of the timetable of the release and/or discharge of the Dihao Previous Supplier Guarantee, the Board is of the view that it is nevertheless in the interest of the Group and the Company’s shareholders for the provision of the Dihao New Supplier Guarantee by the Dihao Guarantor, for the following reasons:

• (i) the Dihao Previous Supplier Guarantee may be enforced by BOC immediately;

• (ii) the immediate enforcement by BOC of the Dihao Previous Supplier Guarantee for full repayment of the Previous Supplier Loan by the Dihao Guarantor may lead to disposal of assets or businesses of the Dihao Guarantor, or even liquidation of the Dihao Guarantor, in light of the amount of net current liabilities of the Dihao Guarantor, as well as the consolidated cash and cash equivalent of the Group as at 30 June 2018 as aforementioned in this circular;

• (iii) as at 30 June 2018, the outstanding amount of the banking facilities of the Dihao Guarantor guaranteed by the Company amounted to approximately RMB180.0 million. As such, the liquidation of the Dihao Guarantor may lead to cross default of intra-group corporate guarantees given by the Group to the Dihao Guarantor, which will have significant adverse impact on the going concern of the Group; and

• (iv) the provision of the Dihao New Supplier Guarantee by the Dihao Guarantor is the current most feasible solution for prevention of the above chain of events in light of the limited time available to the Group, which may allow the Group and Dajincang to have additional time for the Completion or the further negotiation with BOC for the release of the Dihao Previous Supplier Guarantee. In addition, the Board wishes to emphasise that, irrespective of the financial capability of Dajincang, the New Supplier Loan Agreements and the Dihao New Supplier Guarantee are subject to the discretion and internal approval of BOC, and therefore may not be entered into by BOC, Dajincang and the Dihao Guarantor notwithstanding the approval by the shareholders of GBT and the Company.

— 15 —

LETTER FROM THE BOARD

Given the reasons as set out above, the Board is of the view that entering into the Dihao New Supplier Guarantee by the Dihao Guarantor is in the interest of the Company and the Shareholders as a whole.

Given that the New Supplier Loan serves the function of refinancing and extending the Previous Supplier Loan for the same loan amount, and that the Dihao New Supplier Guarantee shall replace the Dihao Previous Supplier Guarantee without guaranteeing additional amount of debts of Dajincang, the Board expects that the risk exposure of the Group will not be material changed under the Dihao New Supplier Guarantee.

The Dihao New Supplier Guarantee may give rise to a disclaimer of opinion in the auditor’s report in 2018, similar to that in 2017 which was resulted from, among others, the limitation of audit scope in respect of the Dihao Previous Supplier Guarantee. In accordance with applicable accounting standards, financial guarantee contracts are initially recognised at fair value at the time when the financial guarantee contracts are entered into, and are subsequently measured at the higher of (a) the amount determined in accordance with HKAS 37 and (b) the amount initially recognised less, when appropriate, cumulative amortisation recognised in accordance with HKFRS 15. The fair value of financial guarantee contracts is assessed with reference to, among others, the financial position and repayment ability of the principal debtor to which the financial guarantee contracts relate.

Since Dajincang is a third party private company, information about its financial position, including its repayment ability, liquidity and other financial resources, may not be readily available to the Group or otherwise considered reliable to the satisfaction of valuers. The valuers engaged by the Group in appraising the fair value of the Dihao Previous Supplier Guarantee had encountered such difficulties so they were unable to reliably estimate the fair value of the Dihao Previous Supplier Guarantee, and it is expected that the valuers will encounter the same difficulties when appraising the fair value of the Dihao New Supplier Guarantee. Consequently, it is expected that a limitation of audit scope of the same nature in 2017 will continue in 2018.

The Company is not able to give assurance on whether another replacement guarantee to replace the Dihao New Supplier Guarantee will be required to be issued by the Group after 12 months, as that would depend on among others, the progress of the Acquisition or the execution of acceptable replacement guarantees in favour of BOC for replacing the Dihao Previous Supplier Guarantee, the restructuring of Dajincang and the financial viability of Dajincang. Nevertheless, as abovementioned, the Company will endeavour to achieve the Completion and/or the release of the

— 16 —

LETTER FROM THE BOARD

Dihao Guarantor from the Dihao Previous Supplier Guarantee and explore other alternatives, amongs others, debt restructuring, in case Dajincang fails to repay the New Supplier Loan as a result that the Dihao Guarantor is demanded for immediate repayment of the Previous Supplier Loan or (as applicable) the New Supplier Loan pursuant to the Previous Supplier Loan Agreements or (as applicable) the New Supplier Loan Agreements.

Information of Dajincang and BOC

The principal business of Dajincang 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.

Dajincang 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 Directors having made all reasonable enquiries, save that (i) Dajincang was a former major supplier of the Group of corn kernels, and (ii) the ultimate beneficial owner of Dajincang includes the Labour Union. Dajincang and its ultimate beneficial owners are third parties independent of the Company, and its 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 Dajincang, Dajincang has a negative net asset value of approximately RMB103.2 million as of 30 June 2018 and a net loss after taxation of approximately RMB61.4 million for the six months ended 30 June 2018.

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

Information of the GBT Group and the Group

The GBT Group is principally engaged in the manufacture and sale of corn refined products, corn based biochemical products and (through the Group) corn based sweetener products.

— 17 —

LETTER FROM THE BOARD

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

Implications under the Listing Rules

As the applicable percentage ratios in respect of the Dihao New Supplier Guarantee exceeded 25%, the Dihao New Supplier Guarantee constitutes a major transaction of the Company and is therefore subject to the notification, announcement and shareholders’ approval requirements under the Listing Rules.

3. EGM

The Company will convene the EGM at Room 1, United Conference Centre, 10/F., United Centre, 95 Queensway, Admiralty, Hong Kong at 10:30 a.m. on Friday, 21 December 2018 to consider and, if thought fit, approve the Dihao New Supplier Guarantee and the transactions contemplated thereunder. A notice of the EGM is set out on pages 32 to 33 of this circular.

To the best knowledge of the Directors after making all reasonable enquiries, as at the Latest Practicable Date, no shareholder is required to abstain from voting on the resolution approving the Dihao New Supplier Guarantee and the transactions contemplated thereunder, all resolutions to be proposed at the EGM will be taken by poll, the results of which will be announced after the EGM.

A form of proxy for use at the EGM is also enclosed. If you are unable to attend the EGM in person, you are requested to complete and return the form of proxy in accordance with the instructions printed thereon as soon as possible and, in any event no later than 48 hours before the time for the EGM (i.e. at or before 10:30 a.m. on Wednesday, 19 December 2018 (Hong Kong time)) or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish.

4. RECOMMENDATION

The Directors consider that the terms of the Dihao New Supplier Guarantee and the transactions contemplated thereunder are fair and reasonable and are in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend you to vote in favour of the resolution in the terms as set out in the notice of the EGM.

— 18 —

LETTER FROM THE BOARD

5. ADDITIONAL INFORMATION

Your attention is also drawn to the information contained in the appendices to this circular.

By order of the Board Global Sweeteners Holdings Limited Kong Zhanpeng Chairman

— 19 —

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

1. INDEBTEDNESS STATEMENT

As at the close of business on 31 October 2018, being the Latest Practicable Date for the purpose of preparing this statement of indebtedness prior to the printing of this circular, the Group had total interest-bearing borrowings of approximately HK$1,092,359,000, details of which are as follows:

Unguaranteed Secured HK$’000 Non-current Bank loans 191,667 Current Bank loans 52,381 244,048	Guaranteed Secured Unsecured HK$’000 HK$’000 — — 139,523 708,788 139,523 708,788	Total HK$’000 191,667 900,692
		1,092,359

The Group’s bank borrowings amounting to HK$383,571,000 were secured by the pledge of certain of the Group’s property, plant and equipment and prepaid land lease payment.

At the close of business on 31 October 2018, Dihao Foodstuff was one of the guarantors to the Previous Supplier Loan with a maximum guaranteed amount of RMB2.5 billion.

Apart from intra-Group liabilities and save as aforesaid, at the close of business on 31 October 2018, the Group did not have any other outstanding debt securities, term loans, other bank overdrafts, liabilities under acceptances (other than normal trade bills), acceptance credits, hire purchase commitments or other borrowings or indebtedness in the nature of borrowings, mortgage, charges, contingent liabilities or guarantees.

— 20 —

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

2. WORKING CAPITAL

The Group has incurred losses since 2012 and recorded a net loss of approximately HK$132.8 million for the six months ended 30 June 2018. As at 30 June 2018, the Group recorded net current liabilities of approximately HK$1,017.0 million and net liabilities of approximately HK$248.2 million. In view of these circumstances, the Directors have taken the following steps to improve the Group’s liquidity and solvency position:

(1) Active negotiations with banks to obtain adequate bank borrowings

The management of the Company has been actively negotiating with banks in the PRC to secure the renewals of the Group’s short-term and long-term bank loans to meet its liabilities when fall due. A debt-equity swap proposal for the restructure of the debt of the Company’s subsidiaries in Changchun was submitted to the People’s Government of Jilin Province for consideration. On 26 March 2018, Mr. Yuan Weisen, the Chairman of GBT, met with the representatives of Bank of China Jilin Province Branch on behalf of the Group and the GBT Group, and it was proposed that the Group and the GBT Group should provide a revised debt-equity swap proposal to Bank of China Jilin Province Branch. On 2 April 2018, a revised debt-equity swap proposal was submitted to Bank of China Jilin Province Branch for their consideration. Subsequently, the Group, the GBT Group and BOC have also explored possibility of including the indebtedness of Dajincang into the debt-equity swap proposal, and a further revised debt-equity swap proposal (“ Revised Debt-Equity Swap Proposal ”) was submitted by the Group and the GBT Group to Bank of China Jilin Province Branch proposing the conversion of debt due to banks to equity in order to lower the debt ratio of the Group, the GBT Group and Dajincang, the introduction of strategic investor(s) in order to strengthen the capital of the Group and the GBT Group, and the cooperation with the potential purchaser of the land and buildings located in Luyuan District, Changchun for the re-development of the land owned by the Group and the GBT Group. The Revised Debt-Equity Swap Proposal has been approved by Bank of China Jilin Province Branch, and further submitted to the People’s Government of Jilin Province in August 2018 for their consideration.

As at the Latest Practicable Date, the Revised Debt-Equity Swap Proposal is pending the approval by the People’s Government of Jilin Province and headquarters of the other lending banks of the Group in the PRC. The Company will continue to endeavour to facilitate the materialisation of the Revised Debt-Equity Swap Proposal which shall resolve the audit limitation in respect of the Dihao Previous Supplier Guarantee and/or the Dihao New

— 21 —

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

Supplier Guarantee and the material uncertainty related to going concern of the Group and it is targeted that the Revised Debt-Equity Swap Proposal will be completed by the end of the third quarter of 2019, subject to the due approval from the People’s Government of Jilin Province.

(2) Transfer of two subsidiaries in Changchun to the GBT Group

As announced by the Company and GBT on 21 July 2017, the Group entered into an agreement with the GBT Group for the sale and purchase of the two subsidiaries of the Company, namely Dihao Foodstuff and Dihao Crystal Sugar.

The Acquisition could relieve the Group from the potential liability from the Dihao New Supplier Guarantee but without adding additional financial burden to the GBT Group.

Following the Completion, Dihao Foodstuff and Dihao Crystal Sugar will cease to be the subsidiaries of the Company and the financial results of Dihao Foodstuff and Dihao Crystal Sugar will cease to be consolidated into those of the Company. It is estimated that after the Completion, the financial performance of the Group will improve.

The Completion is conditional upon the fulfillment of certain conditions. Up to the Latest Practicable Date, those conditions have not been completely fulfilled. Specifically, the management is still in the process of discussing with the relevant banks for the release of the guarantees and/or charges given by a member of the Group in respect of the indebtedness of Dihao Foodstuff. As disclosed in the announcement of the Company dated 16 July 2018, as additional time is required for the fulfillment of the conditions precedent, the long stop date has been extended to 31 December 2018.

(3) Monitoring of the Group’s operating cash flows

The Group has taken various measures to tighten cost controls over production costs and expenses with the aim to attain profitable and positive cash flow operations. The Group has optimised its production in order to minimise operating cash outflows.

— 22 —

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

(4) Financial support from the indirect controlling shareholder of GBT

The Group has received a written confirmation dated 8 June 2018 from Nongtou that it will continue to provide financial support to the Group and the GBT Group in the next 24 months for their operations on a going concern basis and undertake all the liabilities that may arise from the Dihao New Supplier Guarantee. Such assistance received by the Group is not secured by any assets of the Group.

In addition, the Group signed a corn purchasing contract for the supply of 300,000 MT of corn kernels with Jiliang, a subsidiary of Nongtou, in January 2018 to ensure a stable supply of corn kernels. During the six months ended 30 June 2018, the Group purchased approximately 28,000 MT of corn kernels from Jiliang which accounted for 11.4% of total corn procurement of the Group.

Furthermore, the Group, through the connection of Nongtou, signed a corn purchasing contract for the supply of 500,000 MT of corn kernels with the state-owned supplier in January 2018 to further secure a stable supply of corn kernels for 2018. During the six months ended 30 June 2018, the Group purchased approximately 76,000 MT of corn kernels from the state-owned supplier which accounted for 31.1% of total corn procurement of the Group.

Nongtou, being a state-owned enterprise, was established in August 2016 and its unaudited net assets value amounted to RMB1,212.3 million at 30 June 2018, is tasked to consolidate the state-owned investments in the agricultural sector in Jilin Province. The management of the Company is of the view that Nongtou would be able to support the operations of the Group and the GBT Group, to provide synergistic effects among its various investments in the agricultural sector in Jilin Province and to provide adequate and sufficient financial support to the Group.

In view of the steps taken by the Company as disclosed above, it is expected that the financial condition of the Group will gradually improve, while the further provision of financial assistance to Dajincang by entering into the Dihao New Supplier Guarantee is a means to prevent BOC from enforcing the Dihao Previous Supplier Guarantee immediately, which the Group currently does not have sufficient resources for repayment thereof. Since the Dihao New Supplier Guarantee will not further increase the risk exposure of the Group, the Board considers that it is in the interest of the Company and the Shareholders as a whole to enter into the Dihao New Supplier Guarantee in order to buy time for the Group to resume to a healthier financial position.

— 23 —

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

The Directors propose to procure additional working capital through the steps mentioned above. After taking into account the above proposals, the internal resources, the present and expected available banking facilities, the Group has sufficient working capital for its requirements for at least the next 12 months from the date of this circular.

3. FINANCIAL AND TRADING PROSPECTS

In order to maintain the competitiveness of the Group, the Group will strive to maintain its market share, diversify its product mix and enhance its capability in developing high value-added products and new applications through in-house research and development efforts and strategic business alliance with prominent international market leaders.

In the short run, the Group will consolidate its resources towards the development of the Shanghai production base, leveraging on the synergistic effect with the Jinzhou production base for the supply of raw materials/ sweeteners products to serve the respective Huadong market.

In the long run, the Group will continue to strengthen its market position leveraging on its brand name and add value to the current product mix through the introduction of new high value-added products.

With respect to the financial position of the Group, the management will endeavor to overcome the challenges and adopt a prudent approach in face of the current market condition.

4. MATERIAL ADVERSE CHANGE

Save as disclosed in the joint announcement of GBT and the Company dated 21 September 2018 that a wholly owned subsidiary of the Company was in breach of a loan agreement with outstanding principal amount of RMB29.2 million which may trigger cross defaults in other loan agreements entered into by the Group with aggregate outstanding principal amount of approximately RMB454.8 million which circumstances remained unchanged as at the Latest Practicable Date, the Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 December 2017, being the date to which the latest published audited financial statements of the Group were made up.

— 24 —

GENERAL INFORMATION

APPENDIX II

1. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. DIRECTORS’ AND CHIEF EXECUTIVES’ INTERESTS AND SHORT POSITIONS IN SHARES AND UNDERLYING SHARES

As at the Latest Practicable Date, the interests or short positions of the Directors and chief executives of the Company in the Shares, underlying Shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) (a) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO); or (b) which were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (c) which were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (the “Model Code”) to be notified to the Company and the Stock Exchange, were as follows:

Long positions in ordinary shares of the Company:

				Percentage of relevant
				class of issued share
	Company/name			capital of the
Name of	of associated		Number of Shares	Company/associated
Director	corporation	Nature of interest	interested(Note 1)	corporation(Note 2)
Mr. Kong	The Company	Interest of a controlled	1,984,000 (L)	0.13
Zhanpeng		corporation	(Note 3)
	GBT	Beneficial owner	18,256,000 (L)	0.29
	GBT	Interest of a controlled	241,920,000 (L)	3.78
		corporation	(Note 4)

— 25 —

GENERAL INFORMATION

APPENDIX II

Notes:

1. The letter “L” represents the Director’s interests in the Shares and underlying Shares of the Company or its associated corporation.

2. On the basis of 1,527,586,000 Shares in issue as at the Latest Practicable Date.

3. These Shares are held by Hartington Profits Limited, a company incorporated in the British Virgin Islands, the entire issued share capital of which is beneficially owned by Mr. Kong Zhanpeng.

4. These 241,920,000 Shares are held by Hartington Profits Limited.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors and chief executives of the Company had any interests or short positions in the Shares, underlying Shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) as recorded in the register required to be kept under section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code.

None of the Directors had any interest, direct or indirect, in any assets which have been since 31 December 2017, being the date to which the latest published audited financial statements of the Group were made up, acquired or disposed of by or leased to any member of the Group, or are proposed to be acquired or disposed of by or leased to any member of the Group as at the Latest Practicable Date.

Mr. Kong Zhanpeng, an executive Director, is interested in approximately 4.07% of the issued share capital of GBT through his interest as beneficial owner and interest in Hartington Profits Limited. In addition, Mr. Zhang Zihua, an executive Director, is also the executive director of GBT. As such, both Mr. Kong Zhanpeng and Mr. Zhang Zihua are considered to have material interests in the Acquisition.

Save as disclosed above, none of the Directors or proposed directors of the Company (if any) was materially interested in any contract or arrangement subsisting as at the Latest Practicable Date and which is significant in relation to the business of the Group taken as a whole.

3. SUBSTANTIAL SHAREHOLDERS’ INTERESTS IN SHARES AND UNDERLYING SHARES

As at the Latest Practicable Date, so far as is known to any Directors or chief executives of the Company, the persons (other than a Director or chief executives of the Company); (a) who had an interest or short position in the Shares and underlying Shares of the Company which would fall to be disclosed to the Company under the

— 26 —

GENERAL INFORMATION

APPENDIX II

provisions of Divisions 2 and 3 of Part XV of the SFO; or (b) who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at the general meetings of the Company or any other members of the Group, were as follows:

			Capital/
			number
	Company/		of Shares/	Approximate
	Name of		underlying	percentage of
Name of	Group	Nature of	Shares held	shareholding
shareholder	member	interest	(Note 1)	(Note 2)
Global Corn Bio-	The	Beneficial	977,778,000	64.01
chem Technology	Company	owner	(L)
Company Limited
(“Global Corn
Bio-chem”)
GBT	The	Interest of a	977,778,000	64.01
	Company	controlled	(L)
		corporation
		(Note 3)
	The	Beneficial	500,000	0.03
	Company	owner	(L)
Modern	The	Interest of a	978,278,000	64.04
Agricultural	Company	controlled	(L)
(Note 4)		corporation
Modern	The	Interest of a	978,278,000	64.04
Agricultural	Company	controlled	(L)
Industry		corporation
Investment
Holdings Limited
(Note 4)

— 27 —

GENERAL INFORMATION

APPENDIX II

			Capital/
			number
	Company/		of Shares/	Approximate
	Name of		underlying	percentage of
Name of	Group	Nature of	Shares held	shareholding
shareholder	member	interest	(Note 1)	(Note 2)
Jilin Province	The	Interest of a	978,278,000	64.04
Modern	Company	controlled	(L)
Agricultural		corporation
Industry
Investment Fund
(LLP) (“PRC
LLP”)(Note 4)
Jilin Province	The	Interest of a	978,278,000	64.04
Modern	Company	controlled	(L)
Agricultural		corporation
Industry Fund
Limited (“GP”)
(Note 4)
Jilin Province	The	Interest of a	978,278,000	64.04
Communications	Company	controlled	(L)
Investments		corporation
Group Co., Ltd.
(“Jiaotou”)
Nongtou_(Note 4)_	The	Interest of a	978,278,000	64.04
	Company	controlled	(L)
		corporation
SASAC of Jilin	The	Interest of a	978,278,000	64.04
Province_(Note 4)_	Company	controlled	(L)
		corporation

Notes:

1. The letter “L” represents the Director’s interests in the Shares and underlying Shares of the Company.

— 28 —

GENERAL INFORMATION

APPENDIX II

1. On the basis of 1,527,586,000 Shares in issue as at the Latest Practicable Date.

2. These Shares are registered in the name of Global Corn Bio-chem, which is a wholly owned subsidiary of GBT. Therefore, GBT is deemed to be interested in all the Shares in which Global Corn Bio-chem is interested according to the SFO. Mr. Zhang Zihua, an executive Director, is the executive director of GBT.

3. These Shares comprise of 977,778,000 Shares registered in the name of Global Corn Bio-chem and 500,000 Shares in the name of GBT, whose issued share capital is owned as to approximately 49.0% by Modern Agricultural. The entire issued capital of Modern Agricultural is held by Modern Agricultural Industry Investment Holdings Limited which is in turn wholly owned by PRC LLP. The sole general partner of PRC LLP is GP, which is wholly owned by Nongtou. As at the Latest Practicable Date, 20% of the investment capital of PRC LLP is owned by Nongtou and the transfer of a further 40% of the investment capital of PRC LLP to Nongtou from a company controlled by Jiaotou is pending for completion. As announced by the Company on 2 March 2017, during the transition period before the completion, such 40% of the investment capital of PRC LLP shall be managed by Nongtou. As such, by virtue of Nongtou’s control over PRC LLP, Nongtou has become the indirect controlling shareholder of the Company. Nongtou is controlled by SASAC of Jilin Province. Each of Modern Agricultural, Modern Agricultural Industry Investment Holdings Limited, PRC LLP, GP, Jiaotou, Nongtou and SASAC of Jilin Province are deemed to be interested in the interest held by GBT.

Save as disclosed herein, so far as is known to any Director or chief executives of the Company, there was no other person (other than a Director or chief executives of the Company) who, as at the Latest Practicable Date, had an interest or short position in the Shares and underlying Shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who was directly or indirectly interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at the general meetings of the Company or any other member of the Group.

4. SERVICE AGREEMENTS

As at the Latest Practicable Date, none of the Directors had a service contract with any member of the Group which was not determinable by the Company or the relevant member of the Group within one year without payment of compensation other than statutory compensation.

5. MATERIAL LITIGATIONS

As at the Latest Practicable Date, there was no litigation or claims of material importance pending or threatened against the Group as at the Latest Practicable Date.

— 29 —

GENERAL INFORMATION

APPENDIX II

6. MATERIAL CONTRACTS

The following contracts (not being contracts entered into in the ordinary course of business) were entered into by the members of the Group within two years immediately preceding the date of this circular, and are or may be material:

• (a) the S&P Agreement;

• (b) the termination agreement dated 2 March 2017 and entered into between 吉林省太陽神建築工程有限公司 (Jilin Province Taiyangshen Construction Engineering Co., Ltd.) (“ Former Purchaser ”), Dihao Foodstuff and Dihao Crystal Sugar in respect of the termination of the property transfer agreement dated 14 April 2016 and entered into between the Former Purchaser, Dihao Foodstuff and Dihao Crystal Sugar in respect of the sale and purchase of pieces of land and buildings erected thereon at the east side of Xihuancheng Road, Luyuan District, Changchun, the PRC on and subject to the terms and conditions thereof;

• (c) the termination agreement dated 2 March 2017 and entered into between the Former Purchaser, Dihao Foodstuff and Dihao Crystal Sugar in respect of the termination of the asset transfer agreement dated 14 April 2016 and entered into between the Former Purchaser, Dihao Foodstuff and Dihao Crystal Sugar in respect of the sale and purchase of, among others, trade and other receivables owed to the Group on and subject to the terms and conditions thereof; and

• (d) the Dihao Previous Supplier Guarantee guaranteeing all indebtedness due and owing to BOC pursuant to the Previous Supplier Loan Agreements and the maximum principal amount guaranteed under the Dihao Previous Supplier Guarantee was RMB2.5 billion.

— 30 —

GENERAL INFORMATION

APPENDIX II

7. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the head office and principal place of business of the Company in Hong Kong at Suites 2202-4, 22nd Floor, Tower 6, the Gateway, 9 Canton Road, Tsimshatsui, Kowloon, Hong Kong during normal business hours from 9:30 a.m. to 5:00 p.m. on any Business Day from the date of this circular up to and including the date of the EGM:

• (a) the memorandum and articles of association of the Company;

• (b) the consolidated audited accounts of the Company for each of the two financial years ended 31 December 2016 and 31 December 2017;

• (c) the letter from the Board, the text of which is set out on pages 6 to 19 to this circular; and

• (d) the material contracts referred to under the paragraph headed “6. Material Contracts” in this appendix.

8. MISCELLANEOUS

• (a) The registered office of the Company is located at Cricket Square, Hutchins Drive, PO Box 2681, Grand Cayman KY1-1111, Cayman Islands.

• (b) The head office and principal place of business of the Company in Hong Kong is at Suites 2202-4, 22nd Floor, Tower 6, the Gateway, 9 Canton Road, Tsimshatsui, Kowloon, Hong Kong.

• (c) The Hong Kong branch share registrar and transfer office of the Company is Tricor Investor Services Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong.

• (d) The company secretary is Ms. Hui Ka Man. Ms. Hui is a member of the Hong Kong Institute of Certified Public Accountants.

• (e) The English text of this circular shall prevail over its Chinese text.

— 31 —

NOTICE OF EGM

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)

NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that the extraordinary general meeting of Global Sweeteners Holdings Limited (“ Company ”, and together with its subsidiaries, the “ Group ”) will be held on Friday, 21 December 2018 at 10:30 a.m. at Room 1, United Conference Centre, 10/F., United Centre, 95 Queensway, Admiralty, Hong Kong for the purposes of considering and, if though fit, passing the following resolution as ordinary resolution of the Company:

ORDINARY RESOLUTION

“ THAT the guarantee to be given by 長春帝豪食品發展有限公司 (Changchun Dihao Foodstuff Development Co., Ltd.) for the benefit of 長春大金倉玉米收儲有限公司 (Changchun Dajincang Corn Procurement Co., Ltd.) (“ Dajincang ”) in relation to all indebtedness due and owing to 中國銀行股份有限公司偉峰國際支行 (Bank of China Weifeng International Branch) pursuant to any loan agreements or other documents signed by Dajincang in the maximum principal amount of RMB2.5 billion, on and subject to the terms and conditions thereof (a copy of the above guarantee has been produced to the meeting marked “ A ” and signed by the chairman of the meeting for the purpose of identification), and the transactions contemplated thereby be and are hereby approved and that the directors of the Company be and are hereby authorised to take any action and sign any document (under seal, if necessary) as they consider necessary, desirable or expedient in connection therewith or the transactions contemplated thereby.”

By order of the Board of

Global Sweeteners Holdings Limited

Kong Zhanpeng

Chairman

Hong Kong, 3 December 2018

• for identification purposes only

— 32 —

NOTICE OF EGM

Registered office: Head office and principal place Cricket Square of business in Hong Kong: Hutchins Drive Suites 2202-4 PO Box 2681 22nd Floor Grand Cayman KY1-1111 Tower 6, The Gateway Cayman Islands 9 Canton Road, Tsimshatsui, Kowloon, Hong Kong

Notes:

1. A member of the Company entitled to attend and vote at the meeting above is entitled to appoint in written form one or, if he is the holder of two or more Shares, more proxies to attend and vote instead of him. A proxy need not be a member of the Company.

2. In the case of joint holders of Shares, any one of such joint holders may vote, either in person or by proxy, in respect of such Share as if he/she were solely entitled thereto, but if more than one of such joint holders are present at the above meeting, personally or by proxy, that one of the said persons so present whose name stands first in the register in respect of such Share shall alone be entitled to vote in respect thereof.

3. In order to be valid, the form of proxy must be in writing under the hand of the appointor or of his attorney duly authorised in writing, or if the appointor is a corporation, either under seal, or under the hand of an officer or attorney duly authorised, and must be deposited with the Hong Kong branch share registrar and transfer office (“ Branch Registrar ”) of the Company, Tricor Investor Services Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong (together with the power of attorney or other authority, if any, under which it is signed or a notarially certified copy thereof) not less than 48 hours before the time fixed for holding of the meeting (i.e. at or before 10:30 a.m. on Wednesday, 19 December 2018 (Hong Kong time)) or any adjournment thereof.

4. Delivery of an instrument appointing a proxy should not preclude a member from attending and voting in person at the above meeting or any adjournment thereof and in such event, the instrument appointing a proxy shall be deemed to be revoked.

5. For the purpose of determining members who are qualified for attending the above meeting, the register of members of the Company will be closed from Tuesday, 18 December 2018 to Friday, 21 December 2018, during which period no transfer of the Shares will be effected. In order to qualify for attending the above meeting, all transfers of Shares accompanied by the relevant share certificates must be lodged with the Branch Registrar at the above address by no later than 4:30 p.m. on Monday, 17 December 2018.

As at the date of this notice, the Board comprises two executive Directors, namely, Mr. Kong Zhanpeng and Mr. Zhang Zihua; and three independent non-executive Directors, namely, Mr. Ho Lic Ki, Mr. Lo Kwing Yu and Mr. Yuen Tsz Chun.

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