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Burcon NutraScience Corporation

Burcon and ADM Enter Into CLARISOY(R) Letter of Intent

Vancouver, November 15 (ots/PRNewswire)

Burcon NutraScience
Corporation  ("Burcon") announced today that it has signed a
non-binding letter of intent (the "Letter of Intent") with Archer
Daniels Midland Company ("ADM") which details the intention of the
two parties to enter into a license agreement pursuant to which
Burcon will license (the "License") its CLARISOY(R) technology to ADM
on an exclusive basis to produce, market and sell CLARISOY(R) soy
protein isolates ("CLARISOY(R)" or the "Products") world-wide (the
"Definitive Agreement").
The Letter of Intent outlines the major agreed-upon terms for the
proposed Definitive Agreement whereby Burcon will grant an exclusive,
world-wide and royalty-bearing license to ADM for Burcon's
CLARISOY(R) soy protein isolate technology. The terms of the proposed
License include:
- License to ADM of all intellectual property, including know-how and
      trade secrets, concerning the manufacture and use of CLARISOY(R)
    - Royalty stream payable to Burcon on a quarterly basis begins upon the
      signing of the Definitive Agreement
    - Engineering and design of initial semi-works commercial CLARISOY(R)
      production plant to be completed by ADM concurrent with the
      completion of the Definitive Agreement.
    - Royalty structure incorporates financial incentive for ADM to expand
      sales globally
Concurrent with and forming part of the Letter of Intent, Burcon
has also agreed to enter into a stand-still/no-shop agreement with
ADM while the two parties negotiate and execute the Definitive
Agreement for the CLARISOY(R) License.
CLARISOY(R)
CLARISOY(R) is a unique soy protein isolate that is 100% soluble,
transparent and low in viscosity in acidic beverages. The use of
CLARISOY(R) allows for the production of transparent protein
fortified beverages such as juices, soft drinks and sport drinks in
the low pH range, down to pH 2.5. CLARISOY(R) is also heat stable in
acidic beverages, allowing thermal processing, including the ability
to hot-fill with no loss in clarity or change in viscosity.
CLARISOY(R) soy protein isolate does not have the "beany" taste
typically associated with soy protein, opening up significant
opportunities in the existing global soy protein market.
Protein ingredients are valued by the food and beverage industry
for two fundamental properties: nutrition and function.
Nutritionally, Burcon's CLARISOY(R) soy protein isolate is
excellent, with a PDCAAS of 1.0, the highest value possible. PDCAAS
is an acronym for the Protein Digestibility Corrected Amino Acid
Score. PDCAAS is a method of evaluating the nutritional value of a
protein based on both the amino acid requirements of humans and their
ability to digest the protein. In recent studies CLARISOY(R) was
found to have as good or better digestibility than conventionally
prepared soy protein isolate and a complete and balanced amino acid
profile. Burcon's CLARISOY(R) contains exceptionally low levels of
certain anti-nutritional factors found in all plant proteins and is
particularly low in phytate and phenolics. CLARISOY(R) also does not
have high levels of the phytoestrogens, daidzein and genistein, the
naturally occurring isoflavones associated with soy.
Functionally, CLARISOY(R) is equally exciting particularly in
terms of its 100% solubility in acidic solutions and lack of the
"beany" taste typically associated with soy ingredients. The unique
functional trait of acid solubility suggests numerous potential
applications for CLARISOY(R). CLARISOY(R) can easily be incorporated
into various types of acidic beverages to provide a protein boost,
transforming the product into a new category. It is important to note
that CLARISOY(R) is not hydrolyzed and contains the broad spectrum of
storage protein species that make up whole soy protein.
CLARISOY(R)'s features of acid solubility, transparency in
solution, heat stability, balanced nutritional profile, lack of
"beany" taste, low anti-nutritional factors all in a non-hydrolyzed
complete protein make it unique. Burcon is unaware of any other
commercially available soy protein that can make all these claims.
The lack of the "beany" taste typically associated with soy
protein ingredients makes CLARISOY(R) ideal not only for acidic
beverages, but also potentially for more traditional applications
such as protein bars and protein-fortified breakfast cereals.
Soy protein is widely accepted by food processors and consumers
alike. The quest for healthier lifestyles has led consumers to search
for alternatives to animal proteins. The U.S. Food and Drug
Administration's approval of a health claim for soy protein has
fuelled soy protein's increasing popularity and general acceptance
among consumers. This factor - the pursuit of health and wellness in
food products - is expected to drive and sustain the market demand
for CLARISOY(R), which can be incorporated into a wide variety of
beverage and food products.
Proposed CLARISOY(R) License
Under the terms of the Letter of Intent, Burcon and ADM have
agreed to negotiate and execute the Definitive Agreement setting
forth the terms and conditions of the License by no later than March
1, 2011. Under the proposed License, ADM will build an initial
semi-works commercial facility within a pre-defined time period after
the signing of the Definitive Agreement. A pre-production royalty
will be payable quarterly starting from the signing of the Definitive
Agreement through and until the first sale of the Products from the
initial facility. Upon the first sale of Products from the initial
semi-works commercial facility, ADM will then pay a royalty based on
a percentage of net revenues generated by ADM from the sale of the
Products.
The License further contemplates that ADM will increase capacity
to a full-commercial scale. Upon such increase, a full-commercial
royalty rate will be payable on a percentage of the net revenues
generated by ADM from the sale of CLARISOY(R). Under the proposed
terms of the License, there is a mechanism for ADM to benefit from a
stepped-down royalty rate on the establishment of certain commercial
sales levels in additional geographic regions beyond North America.
The additional geographic regions include the rest of the world and
are defined as Asia, South and Central America, Europe including
Eastern Europe and Africa. Capital costs associated with building and
commissioning of production plants and the general market development
of CLARISOY(R) will be the sole expense of ADM.
The Letter of Intent provides for, and the parties have
contemplated, certain specific timing goals. One of these goals is
the preparation of engineering plans for the first semi-works
commercial production facility to be completed by the date of signing
of the Definitive Agreement.
As part of the Letter of Intent, Burcon has agreed to a
stand-still and no-shop clause with ADM. The stand-still provides
that during the period starting from the date of the execution of the
Letter of Intent and continuing and until the earlier of the date of
signing the Definitive Agreement with ADM or March 1, 2011, Burcon
and its officers, agents and employees will not, directly or
indirectly, (i) engage in discussions or negotiations, (ii) enter
into any letter of intent or contract, or (iii) take any action or
encourage any offer or indication of interest from any person, entity
or group, in relation to the license, sale or other form of transfer
of any Burcon intellectual property related to CLARISOY(R). As
previously noted, it is the intention of the two parties to enter
into the Definitive Agreement on or before March 1, 2011.
Although it is the stated intention of Burcon and ADM to enter
into a Definitive Agreement as described above, the Letter of Intent
is non-binding on the parties except for the stand-still agreement
and certain provisions concerning confidentiality and each party
bearing its own expenses relating to the negotiation of the
Definitive Agreement
"We have worked closely with ADM on Burcon's canola technology
and have valued our relationship with ADM for over seven years. As a
leader in the global food ingredient industry, and one of the world's
pre-eminent producers of soy proteins, ADM is the perfect partner to
commercialize Burcon's CLARISOY(R) soy protein isolate" said Johann
F. Tergesen, President and Chief Operating Officer, adding, "We
believe CLARISOY(R)'s potential in the global protein ingredient
industry will be well served through the license structure as
contemplated in the Letter of Intent we have executed with ADM
today."
BMO Capital Markets has acted as financial advisor to Burcon.
About Burcon NutraScience
Burcon is a leader in nutrition, health and wellness in the field
of functional, renewable plant proteins. Since 1999, Burcon has
developed a portfolio of composition, application, and process
patents originating from our core protein extraction and purification
technology. We are developing Puratein(R) and Supertein(TM) canola
protein isolates with unique functional and nutritional attributes,
and CLARISOY(R), a revolutionary soy protein isolate which is 100%
soluble and completely transparent in acidic solutions. Our team of
highly specialized scientists and engineers work from our own
research facility to develop and optimize environmentally sound
technologies. To-date, our patent portfolio consists of 142 issued
patents in various countries, including 24 issued U.S. patents, and
in excess of 200 additional pending patent applications, 59 of which
are U.S. patent applications.
ON BEHALF OF THE BOARD OF DIRECTORS
"Johann F. Tergesen"
Johann F. Tergesen President and Chief Operating Officer
The TSX has not reviewed and does not accept responsibility for
the adequacy of the content of the
information contained herein. This press release contains
forward-looking statements that involve risks and uncertainties.
These forward-looking statements relate to, among other things, plans
and timing for the introduction or enhancement of our products,
statements about future market conditions, supply and demand
conditions, and other expectations, intentions and plans contained in
this press release that are not historical fact. Our expectations
regarding the prospect for future success depend upon our ability to
develop and sell products, which we do not produce today and cannot
be sold without further research and development. When used in this
press release, the words "goal", "intend", "believes" and "potential"
and similar expressions, generally identify forward-looking
statements. These statements reflect our current expectations. They
are subject to a number of risks and uncertainties. In light of the
many risks and uncertainties surrounding the development of a source
of protein from canola meal, you should understand that we cannot
assure you that the forward looking statements contained in this
press release will be realized.
For further information:
    Jade Cheng, Chief Financial Officer
    Burcon NutraScience Corporation
    +1(604)733-0896 / +1(888)408-7960 toll-free
     jcheng@burcon.ca
    http://www.burcon.ca
    AXINO AG
    Wolfgang Seybold, Investor Relations Europe
    AXINO AG, Königstrasse 26, 70173 Stuttgart, Germany
    Tel. +49-711-25-35-92-40 / Fax +49-711-25-35-92-55
     wolfgang.seybold@axino.de
    http://www.burcon.net

Contact:

CONTACT: For further information:Jade Cheng, Chief Financial
Officer,Burcon NutraScience Corporation, +1(604)733-0896 /
+1(888)408-7960toll-free, jcheng@burcon.ca; AXINO AG: Wolfgang
Seybold, Investor RelationsEurope, AXINO AG, Königstrasse 26, 70173
Stuttgart, Germany, Tel.+49-711-25 35 92-40 / Fax +49-711-25 35
92-55, wolfgang.seybold@axino.de

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