GLG Life Tech Corporation ("GLG" or the "Company"), the vertically integrated leader in the agricultural and industrial development of stevia extracts, announces that it has received a demand letter from Weider Global Nutrition ("WGN") that states that WGN will commence, on November 4, 2009, legal proceedings in the Supreme Court of British Columbia against the Company. WGN alleges that pursuant to the shareholder agreement between WGN and the Company, GLG Weider Sweet Naturals Corp. ("Sweet Naturals") became the exclusive marketing and sales arm of the Company, except for its Strategic Alliance and Supply Agreement. WGN also alleges misrepresentation and breach of fiduciary duty by the Company. WGN is claiming injunctive relief, an accounting and damages for alleged breaches of the shareholder agreement.
The Company is of the view that the allegations are entirely without merit. The shareholder agreement contemplates the Company's strategic alliance and supply agreement with its key customer and in no way restricts the Company's ability to perform that agreement and pursue any further opportunities arising from that agreement. Further, the shareholder agreement contemplates that marketing and distribution of wholesale stevia extract products through Sweet Naturals is subject to the permission of the Company and that nothing in the agreement prevents the shareholders of Sweet Naturals from competing with Sweet Naturals. The shareholder agreement contemplates that exclusivity for Sweet Naturals is limited to new business actually generated or customers secured by Sweet Naturals. The Company's position is that any claim by WGN for lost profits is expressly excluded under the shareholders' agreement. It is the Company's view that the injunctions and accounting sought are not legally available and the other remedies would not, in any event, materially and adversely effect the business or operations of the Company. The Company will vigorously defend these allegations.
Since the Company is not dependent upon the non-material revenues from Sweet Naturals, Management of the Company reconfirms its financial guidance for 2009 as disclosed in its press release issued October 30, 2009.
About GLG Life Tech Corporation
GLG Life Tech Corporation is a global leader in the supply of high purity stevia, an all natural, zero-calorie sweetener used in food and beverages. The Company's operations cover each step in the stevia supply chain including non-GMO stevia seed breeding, natural propagation, stevia leaf growth and harvest, proprietary extraction and refining, marketing and distribution of finished product. GLG's advanced technology and extraction technique make it a world leading producer of high purity rebaudioside A extracts. Please visit www.glglifetech.com for further information.
Forward-looking statements: Certain statements in this press release constitute "forward-looking statements". Such forward-looking statements include, without limitation, statements evaluating the market for stevia, the Company's production capacity, demand for stevia and the Company's stevia based products and general economic conditions. Forward-looking statements involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations include operational risks, the effects of general economic conditions, changing foreign exchange rates and actions by government authorities, uncertainties associated with legal proceedings and negotiations, industry supply levels, competitive pricing pressures and other risks and uncertainties disclosed under the heading "Risk Factors" in our Annual Information Form in respect of our year-ended December 31, 2008 and the risk factors in our Management's Discussion and Analysis ("MD&A") for the year ended December 31, 2008 and for the interim period ending September 30, 2009, all of which are available on SEDAR at www.sedar.com. The Company's forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made. The Company assumes no obligation to update forward-looking information should circumstances or management's estimates or opinions change, except as required by law.