Global Bio chem Technology : Announcements and Notices - (1)connected Transaction Subscription of New Shares under Specific Mandate;and (2)adjustment to Conversion Price of Convertible Bonds

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.

This announcement is for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for any securities of the Company.

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)

(1) CONNECTED TRANSACTION -

SUBSCRIPTION OF NEW SHARES UNDER SPECIFIC MANDATE; AND

1. ADJUSTMENT TO CONVERSION PRICE OF CONVERTIBLE BONDS

1. SUBSCRIPTION OF NEW SHARES UNDER SPECIFIC MANDATE
   On 27 September 2019 (after trading hours), the Company entered into the Subscription Agreement with the Subscriber, pursuant to which the Subscriber has conditionally agreed to subscribe for and the Company has conditionally agreed to allot and issue an aggregate of 1,228,607,685 new Shares at the Subscription Price of HK$0.1080 per Subscription Share.
   The Subscription Shares represent approximately 16.0% of the existing issued share capital of the Company and approximately 13.8% of the total issued share capital of the Company as enlarged by the Subscription.
   Specific Mandate
   The Subscription Shares will be allotted and issued pursuant to the Specific Mandate to be sought from the Independent Shareholders at the EGM.
   Application for listing
   Application will be made by the Company to the Stock Exchange for the listing of, and permission to deal in, the Subscription Shares.

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IMPLICATIONS UNDER THE LISTING RULES

As at the date of this announcement, the Subscriber is the beneficial owner of approximately 16.7% of the total issued share capital of the Company. Accordingly, the Subscriber is a substantial Shareholder and a connected person of the Company under Chapter 14A of the Listing Rules. Therefore, the entering into of the Subscription Agreement and the transaction contemplated thereunder constitute a connected transaction for the Company and is subject to the reporting, announcement and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

EGM

The EGM will be held to consider and, if thought fit, pass the ordinary resolutions to approve, among other things, (i) the Subscription Agreement and the transaction contemplated thereunder; and (ii) the grant of the Specific Mandate for the allotment and issue of the Subscription Shares.

A circular containing, among other matters, further information on (i) the Subscription Agreement and the transaction contemplated thereunder (including the Specific Mandate);

1. the respective letters from the Independent Board Committee and the Independent Financial Adviser in respect of the Subscription Agreement and the transaction contemplated thereunder; and (iii) a notice of the EGM is expected to be despatched to the Shareholders on or before 22 October 2019.

As the Subscription Completion is subject to the fulfillment of certain conditions precedent and may or may not proceed, Shareholders and potential investors of the Company are advised to exercise caution when dealing in the Shares.

1. ADJUSTMENT TO CONVERSION PRICE OF CONVERTIBLE BONDS
   As a result of the issue of a total of 1,279,799,672 new Shares by the Company to the Subscriber on 20 August 2019 (details of such subscription were disclosed in the announcements of the Company dated 19 July 2019 and 20 August 2019), the conversion price of the outstanding Convertible Bonds was adjusted, in accordance with the terms and conditions of the Convertible Bonds, from HK$0.23 to HK$0.22 and the maximum number of Shares issuable by the Company upon full conversion of the Convertible Bonds is 4,937,634,386 Shares. The adjustment has taken effect from 20 August 2019. Save for the above adjustments, all other terms and conditions of the Convertible Bonds remain unchanged.

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1. SUBSCRIPTION OF NEW SHARES UNDER SPECIFIC MANDATE THE SUBSCRIPTION AGREEMENT
   Set out below is a summary of the principal terms of the Subscription Agreement:
   Date
   27 September 2019 (after trading hours)
   Parties
2. 1. the Company (as issuer); and
   2. the Subscriber (as subscriber).

As at the date of this announcement, the Subscriber is the beneficial owner of approximately 16.7% of the total issued share capital of the Company. Accordingly, the Subscriber is a substantial Shareholder and a connected person of the Company under Chapter 14A of the Listing Rules.

Subscription

The Subscriber has conditionally agreed to subscribe for and the Company has conditionally agreed to allot and issue 1,228,607,685 new Shares at the Subscription Price of HK$0.1080 per Subscription Share to the Subscriber, at an aggregate consideration of approximately HK$132,690,000 and nominal value of HK$122,860,768.5. Such consideration shall be paid by telegraphic transfer to the bank account of the Company within 30 days (or such other date as shall be agreed between the parties in writing) after fulfilment of conditions precedent (a) to (d) set out in the paragraphs headed "Conditions precedent to the Subscription Completion" in this announcement.

Subscription Shares

The Subscription Shares represent:

1. approximately 16.0% of the existing issued share capital of the Company as at the date of this announcement; and
2. approximately 13.8% of the issued share capital of the Company as enlarged by the allotment and issue of the Subscription Shares (assuming there will be no change in the issued share capital of the Company between the date of this announcement and the date of Subscription Completion, save for the allotment and issue of the Subscription Shares).

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The Subscription Shares, when allotted and issued, will rank pari passu in all respects among themselves free from all liens, charges, guarantee, adverse interests and adverse claims, and with the Shares in issue on the date of allotment and issue of the Subscription Shares including all dividends declared or payable or distributions made or proposed on or after the date of the Subscription Completion.

Conditions precedent to the Subscription Completion

Subscription Completion is conditional upon fulfilment of the following conditions prior to 4 p.m. on or before the Long Stop Date:

1. the Listing Committee of the Stock Exchange having granted the approval for the listing of, and permission to deal in, the Subscription Shares;
2. the Company having obtained all approvals and/or filings required for the Subscription Shares and other related transaction under the Subscription Agreement in accordance with the relevant laws and regulations of the PRC involving state-owned enterprises;
3. the Subscription Agreement and the transaction contemplated thereunder, including the granting of the Specific Mandate for the allotment and issue of the Subscription Shares having been approved by the Independent Shareholders at the EGM;
4. the Subscriber having obtained a positive ruling from the Executive for the rebuttal of the presumption that the Subscriber and the holder(s) who hold or deemed to hold 30% or more of the voting rights of the Company are acting in concert under the Takeovers Code; and
5. all the warranties given under the Subscription Agreement remaining true, accurate and not misleading in all material respects from the date of the Subscription Agreement up to Subscription Completion.

If the Company cannot fulfil any of the above conditions precedent, the Company shall serve a written notice to inform the Subscriber. The Subscriber may at its absolute discretion waive condition precedent (e) above. In the event that any of the conditions of the Subscription is not fulfilled or waived on or prior to 4 p.m. on or before the Long Stop Date (or such later date as may be agreed between the Company and the Subscriber in writing), the Subscription Agreement will terminate and all obligations of the Company and the Subscriber under the Subscription Agreement shall cease and determine and neither the Company nor the Subscriber shall have any claim against the other in respect of any matter arising out of or in connection with the Subscription Agreement except for any antecedent breach of any obligation and any liabilities under the Subscription Agreement.

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Subscription Completion

Subscription Completion will take place on the fifth Business Day after the total Subscription Price of the Subscription Shares is paid (or on such other Business Day as may be agreed between the Company and the Subscriber in writing).

Lock-up arrangement for the Subscription Shares

Pursuant to the Subscription Agreement, the Subscriber undertook that, without the prior written consent of the Company, during a period commencing from and including the date of Subscription Completion and ending on and including the date which is 12 months from the date of Subscription Completion, the Subscriber shall not, and shall procure that none of its associates or companies controlled by it or nominees or trustees holding in trust for it shall sell, transfer or otherwise dispose of (or enter into any agreement to dispose of) any Subscription Shares held by the Subscriber, or the interests in the Subscription Shares, held by the Subscriber.

SUBSCRIPTION PRICE

The Subscription Price is HK$0.1080 per Subscription Share, which represents:

1. a discount of approximately 20.0% to the closing price of HK$0.1350 per Share as quoted on the Stock Exchange on the Last Trading Day; and
2. a discount of approximately 23.7% to the average closing price of HK$0.1416 per Share as quoted on the Stock Exchange for the last five consecutive trading days prior to the Last Trading Day.

The closing price of the Shares on the Last Trading Day was HK$0.1350.

Taking into account the estimated expenses of the Subscription in the amount of approximately HK$690,000, the net price to the Company of each Subscription Share is estimated to be approximately HK$0.1074. The Subscription Price was arrived at after arm's length negotiations between the Company and the Subscriber with reference to various factors, including but not limited to (i) the recent market price of the Shares and the current market condition; and (ii) the financial situation of the Company. The Directors (excluding the independent non-executive Directors whose views will, after receiving the advice from the Independent Financial Adviser, be set out in the letter from the Independent Board Committee in the circular to be despatched to the Shareholders) consider that the Subscription Price is fair and reasonable.

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