VANCOUVER, BRITISH COLUMBIA--(Marketwired - July 26, 2016) - GLG Life Tech Corporation (TSX:GLG) ("GLG" or
the "Company"), a global and agricultural leader in the natural zero-calorie sweetener industry, committed to the sustainable
development of high-quality zero-calorie natural sweeteners, is pleased to announce an important milestone in the Company's plan
to restructure its China-based bank loans. Additionally, the Company successfully renewed a RMB 7 million bank loan with the
Huishang Bank on July 1, 2016.
As of July 20th, 2016, four of five of the Company's 100% owned Chinese Wholly-Owned Foreign Enterprises ("WOFEs") were
consolidated into a single entity (Chuzhou Runhai Stevia High Tech Company Limited or "Runhai") under Chinese law - and,
significantly, Runhai is approved to become a Joint Stock Company ("JSC"). This form of corporation, under Chinese law,
enables it considerable opportunities to raise capital. For example, Runhai will now be able to add Chinese investors, raise
equity capital in China, and convert China-based debt into equity in the JSC. Post consolidation of the four China
subsidiaries, the Company retains its 100% ownership of Runhai and all of the consolidated assets of the previous four China
subsidiaries.
The three subsidiaries consolidated into Runhai are:
Anhui Bengbu HN Stevia High Tech Development Company Limited ("Bengbu")
Qingdao Runhao Stevia High Tech Company Limited ("Runhao")
Dongtai Runyang Stevia High Tech Company Limited ("Runyang")
One of the key outcomes of the conversion of Runhai into a JSC was the underlying agreed valuation of the consolidated Runhai
entity. Runhai's total investment approval by the China Government is USD 120 million and its net assets are valued at USD
42 million. The difference between the asset valuation and net assets value provides Runhai USD 78 million available for
debt conversion, additional working capital or equity raises.
GLG's subsidiary Qingdao Runde Biotechnology Co., Ltd. remains a 100% owned WOFE of GLG.
One particular benefit of reforming the Company's Chinese holdings into a JSC is that the limitations previously foreclosing
the Company from access to Chinese debt and capital markets are gone. As a JSC, Runhai will be eligible to have its
Chinese-held debt converted into equity shares at the subsidiary level, such that a major portion of that debt could be removed
from the Company's balance sheet. GLG, with the PRC government's support, is in active discussions with Runhai's Chinese
debt-holders to negotiate terms for a debt-equity swap, and is exploring multiple options for access to valuable working capital.
The Company expects to retain a majority controlling interest in Runhai after any expected debt conversion into equity in
Runhai. Further, Runhai will have the ability to solicit Chinese capital markets and investors for working and other
capital, bolstered by a more attractive balance sheet and a strong appetite in China for growth opportunities.
The process to convert the four WOFEs into a single consolidated Joint Stock Company was unusually complex. To give
perspective on this major accomplishment, GLG management had to work through ten different government agencies across three
provinces and four cities in order to obtain the relevant approvals necessary to accomplish this important milestone.
With this foundational milestone completed, GLG's plan is to restructure its China debt by availing itself of one or more
options now open to the Company. The Company also expects to gain access to new sources of working capital to facilitate its
plans for substantial growth in its stevia, monk fruit, and GLG Naturals+ businesses.
About GLG Life Tech Corporation
GLG Life Tech Corporation is a global leader in the supply of high-purity zero calorie natural sweeteners including stevia and
monk fruit extracts used in food and beverages. GLG's vertically integrated operations, which incorporate our Fairness to
Farmers program and emphasize sustainability throughout, cover each step in the stevia and monk fruit supply chains including
non-GMO seed and seedling breeding, natural propagation, growth and harvest, proprietary extraction and refining, marketing and
distribution of the finished products. Additionally, to further meet the varied needs of the food and beverage industry, GLG
has launched its Naturals+ product line, enabling it to supply a host of complementary ingredients reliably sourced through its
supplier network in China. For further information, please visit www.glglifetech.com.
Forward-looking statements: This press release may contain certain information that may constitute
"forward-looking statements" and "forward looking information" (collectively, "forward-looking statements") within the meaning of
applicable securities laws. Often, but not always, forward-looking statements can be identified by the use of words such as
"plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates"
or "does not anticipate", or "believes" or variations of such words and phrases or words and phrases that state or indicate that
certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.
While the Company has based these forward-looking statements on its current expectations about future events, the
statements are not guarantees of the Company's future performance and are subject to risks, uncertainties, assumptions and other
factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking
statements. Such factors include amongst others the effects of general economic conditions, consumer demand for our products and
new orders from our customers and distributors, changing foreign exchange rates and actions by government authorities,
uncertainties associated with legal proceedings and negotiations, industry supply levels, competitive pricing pressures and
misjudgments in the course of preparing forward-looking statements. Specific reference is made to the risks set forth under the
heading "Risk Factors" in the Company's Annual Information Form for the financial year ended December 31, 2015. In light of these
factors, the forward-looking events discussed in this press release might not occur.
Further, although the Company has attempted to identify factors that could cause actual actions, events or results to
differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or
results not to be as anticipated, estimated or intended. The Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future events or otherwise.
As there can be no assurance that forward-looking statements will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such statements, readers should not place undue reliance on
forward-looking statements.