LED Medical Diagnostics Announces Preferred Share Financing and Exchange of Debentures

Vancouver, British Columbia (FSCwire) - LED Medical Diagnostics Inc. (“LED” or the “Company”) (TSXV: LMD) announced that it is proposing a series of transactions to significantly improve its balance sheet and provide additional working capital for a new phase of growth.

Highlights of the transactions announced today

• Will Immediately reduce LED’s senior secured debt obligations by almost CDN$3.7 million

• Will allow LED to retire an additional CDN$2.25 million of senior debt over the next six months

• Will Strengthen the balance sheet and provide additional working capital for growth

The Company today announced a proposed brokered private placement and a concurrent non-brokered direct private placement financing (the “Financing”) for combined gross proceeds of up to approximately CDN$5,500,000 through the issuance of up to 12,222,223 convertible preferred shares of the Company (the “Preferred Shares”) at an issue price of CDN$0.45 per share.  Each Preferred Share is entitled to receive a cumulative annual dividend equal to CDN$0.0225 per share (5%), payable in arrears quarterly in cash, which may be increased to an annual dividend of CDN$0.054 per year under certain circumstances.  Each Preferred Share is convertible into common shares of LED (“Common Shares”) at the holder’s option on a one-for-one basis, and at the Company’s option in certain circumstances. The Preferred Shares will mature five years from the closing at which time each Preferred Share will be redeemed by LED for CDN$0.45 plus any unpaid dividends.

In addition to the Financing, LED proposes to issue 8,147,071 Preferred Shares on the same terms in exchange for approximately CDN$3.67 million of LED’s outstanding senior secured debentures, including interest accrued thereon, on a dollar-for-dollar basis (the “Debenture Exchange”).

“The Company has significantly improved its financial performance since its strategic acquisition of Apteryx Inc. in February 2017, with a greater contribution from recurring revenues,” stated Dr. David Gane, Chief Executive Officer of LED. “The Financing and Debenture Exchange will strengthen our balance sheet, reduce our debt servicing costs, and will enable LED to invest in its future growth.”

A syndicate led by Bloom Burton Securities Inc. are acting as agents (the “Agents”) to LED for the financing. In connection with the offering, the Agents are entitled to receive a cash commission of 6% of the gross proceeds of the Financing, 3% of the gross proceeds of the Debenture Exchange and non-transferable broker warrants (the “Broker Warrants”) equal to 3% of the aggregate number of Preferred Shares issued in connection with the Financing and Debenture Exchange.  Each Broker Warrant will entitle the holder to acquire one common share in the capital of LED for a period of 24 months from the closing date at an exercise price of $0.45 per share.

Certain insiders of LED (director and officer) may acquire up to 170,000 Preferred Shares in the concurrent non-brokered direct private placement.

The proceeds will be used by LED to repay indebtedness of CDN$2.25 million, satisfy its deferred purchase consideration pertaining to the acquisition of Apteryx Software Inc. and for general working capital purposes.

All securities issued in connection with the transaction are subject to a hold period expiring four months and one day after the Closing Date, which is expected to be on or about September 4, 2018.

The issuance of the securities is subject to TSXV acceptance.

About LED Medical Diagnostics Inc.

LED Medical Diagnostics Inc. is a dental imaging technology provider focused on delivering state-of-the-art imaging software and systems. Through its wholly-owned subsidiaries LED Dental Inc., LED Dental Ltd., and Apteryx, Inc., LED Medical has provided dentists and oral health specialists with advanced diagnostic imaging products and software for over 20 years. LED’s proprietary technologies include the VELscope Vx Enhanced Oral Assessment and TUXEDO Intraoral Sensors, in addition to Apteryx’s XrayVision, XVWeb and XrayVision DCV imaging software solutions. Backed by an experienced leadership team and dedicated to a higher level of service and support, LED is committed to providing dental practitioners with the best technology available by identifying and adding leading products to its growing portfolio.  The Company is currently listed on the TSXV under the symbol LMD, the OTCQB under the symbol LEDIF, as well as the Frankfurt Stock Exchange under the symbol LME.

Media Contact:

LED Dental

Chris Koch

Phone: 678.293.9413

Email: chris.koch@leddental.com

Corporate Contact:

LED Medical

David Gane, CEO

Phone: 604-434-4614 ext 227

Email: david.gane@leddental.com

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward Looking Statements

This press release contains statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking information under applicable Canadian securities legislation that involve risks and uncertainties. Such forward-looking statements or information include statements regarding, but not limited to, the expectation to close the financing and expected use of proceeds of the financing. Persons reading this press release are cautioned that such statements or information are only predictions, and that the Company's actual future results or performance may be materially different. Factors that could cause actual events or results to differ materially from those suggested by these forward-looking statements include, but are not limited to: financing risks including failure to obtain regulatory approval; economic conditions; dilution; limited history of profits and operations; operational risk; distributor risks; working capital; potential conflicts of interest; speculative investment; intellectual property risks; disruptions in production; reliance on key personnel; seasonality; management’s estimates; development of new customers and products risks; stock price volatility risk; sales and marketing risk; competitors and competition risk; regulatory requirements; reliance on few suppliers; reliance on subcontractors; operating cost and quarterly results fluctuations; fluctuations in exchange rates; product liability and medical malpractice claims; access to credit and additional financing; taxation; market acceptance of the Company’s products and services; customer and industry analyst perception of the Company and its technology vision and future prospects; technological change, new products and standards; risks related to acquisitions and international expansion; reliance on large customers; concentration of sales; international operations and sales; management of growth and expansion; dependence upon key personnel and hiring; the Company not adequately protecting its intellectual property; risks related to product defects and product liability; reliance on third party suppliers; future working capital investments in accounts receivable and inventory; credit terms from suppliers; and including, but not limited to, other factors described in the Company’s reports filed on SEDAR, including its financial statements and management’s discussion and analysis for the three and six months ended June 30, 2017 and its Annual Information Form and financial report for the year ended December 31, 2016.  This list is not exhaustive of the factors that may affect the Company’s forward-looking information. These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking information. All forward-looking statements made in this press release are qualified by this cautionary statement and there can be no assurance that actual results or developments anticipated by the Company will be realized. The Company disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

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