Forbes Medi-Tech Inc.
OTC Bulletin Board : FMTI

May 12, 2008 08:00 ET

Forbes Medi-Tech Announces Completion of $3.8 Million Non-Dilutive Funding Transaction

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 12, 2008) - Forbes Medi-Tech Inc. (TSX:FMI)(NASDAQ:FMTI) ("Forbes" or the "Company") today announced that, as part of its continuing reorganization plan, it has completed the previously announced transaction with a private investor (the "Investor") to reorganize Forbes Medi-Tech Operations Inc. ("FMTO"), a wholly owned subsidiary of Forbes.

"By closing this transaction, we believe Forbes is demonstrating its ongoing commitment to create value for its shareholders," said Charles Butt, President and CEO of Forbes Medi-Tech. "We have now obtained $3 million of non-dilutive capital for our business development and operational plans, to be followed by an additional $800,000 within a year, with a possible upside on the latter amount."

The Investor has made an investment of $3 million in a convertible debenture of FMTO. All of the assets, liabilities and operations of FMTO, including the proceeds from the issue of the convertible debenture, have been transferred to Forbes, which will continue to carry on the business previously carried on by FMTO. The debenture is convertible into 35 percent of the voting common shares and all of the non-voting common shares of FMTO, representing 79 percent of the issued and outstanding common shares of FMTO at the time of completion of the transaction. Forbes and the Investor will source and pursue other opportunities to maximize the value of their respective interests in FMTO. Subject to certain conditions, the Investor has agreed that Forbes will receive a minimum of $800,000 from these other opportunities within one year of completion of the transaction.

The transaction will not result in any change to the share ownership of Forbes, its listing on the NASDAQ or TSX, the composition of its Board of Directors, management or in any of its relationships and commitments to shareholders, employees, government and industry partners, customers, and suppliers.

About Forbes Medi-Tech Inc.

Forbes Medi-Tech Inc. is a life sciences company dedicated to the research, development and commercialization of innovative products for the prevention and treatment of life-threatening disease. Our strategy and vision is to develop and market a portfolio of products for the benefit of all consumers, from the healthy person desiring consumer lifestyle products that can help reduce the risk of future disease, to medical patients needing therapeutic prescription products for the treatment of an established ailment. Additional information on Forbes Medi-Tech can be found at

This News Release contains forward-looking statements and information regarding Forbes' continuing reorganization plan and non-dilutive financing, and Forbes' strategy and vision, which statements can be identified by the use of forward-looking terminology such as "will", "expected", "expects", "to be followed by", "possible", "strategy" and "vision". The Company's actual results could differ materially from those anticipated in these forward-looking statements and information as a result of numerous factors, including the possibility that the reorganization will result in different outcomes than those currently anticipated; uncertainty whether the Company will receive all or any of the anticipated proceeds of the financing, including the $800,000 within a year or any upside on such amount, which are subject to the fulfillment of certain conditions; the need for performance by the Investor; the Company's need for further funding, which is not assured; changes in business strategy or development plans; uncertainty whether the Company will realize its strategies and vision; and other risks and uncertainties, as contained in news releases, the Company's latest Annual Report on Form 20-F, and other filings with Securities Regulatory Authorities in Canada and the U.S. at and at, any of which could cause actual results to vary materially from current results or the Company's anticipated future results. Forward-looking statements and information are based on the assumptions, beliefs, opinions and expectations of the Company's management at the time they are made, and, except as required under applicable law, the Company does not assume any obligation to update any statement should those assumptions, beliefs, opinions or expectations, or other circumstances change.

NASDAQ and the Toronto Stock Exchange have not reviewed and do not accept responsibility for the adequacy or accuracy of the content of this News Release.

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