/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES/
CSE: LEAD
VANCOUVER, Oct. 5, 2018 /CNW Telbec/ - Lead Ventures Inc.
(CSE: LEAD) ("LVI" or the "Company") announced today proposed amendments to certain matters which are to be
considered and voted upon at its annual and special shareholder meeting scheduled to be held on Friday,
October 12, 2018 (the "Meeting") as part of the proposed business combination (the "Business Combination")
that will result in a reverse takeover (RTO) of the Company and the listing for trading of the subordinate voting shares of the
resulting issuer (the "Resulting Issuer") on the Canadian Securities Exchange. The Company also wishes to announce that it
has filed an amendment (the "Amendment") to the management information circular of the Company dated September 12, 2018 (the "Circular") to reflect the proposed amendments.
The Circular indicated that at the Meeting, shareholders will be invited to vote on a special resolution
(the "Amendment Resolution") to authorize and approve an amendment of the notice of articles and articles of the
Company to amend the rights and restrictions of the common shares in the capital of the Company and reclassify such class as
subordinate voting shares (the "Subordinate Voting Shares"), to create a class of multiple voting shares and to eliminate
the class of preferred shares.
As part of the reclassification of the common shares in the capital of the Company into Subordinate Voting Shares, the Company
is further proposing to amend the notice of articles and Articles of the Company to add certain provisions, including a
redemption right in favour of the Company (or the Resulting Issuer following the Business Combination) (the "Licensing
Provisions") to ensure that the Company (or the Resulting Issuer following the Business Combination) complies with applicable
licensing regulations.
The purpose of the Licensing Provisions is to provide LVI (or the Resulting Issuer following the Business Combination) with a
means of protecting itself from having a shareholder, or as determined by the LVI Board (or the Resulting Issuer Board following
the Business Combination), a group of shareholders acting jointly or in concert (an "Unsuitable Person") with an ownership
interest of, whether of record or beneficially (or having the power to exercise control or direction over), five percent (5%) or
more of the issued and outstanding shares of LVI (or the Resulting Issuer following the Business Combination), who a governmental
authority granting licenses to LVI (or the Resulting Issuer following the Business Combination) has determined to be unsuitable
to own Subordinate Voting Shares, or whose ownership of Subordinate Voting Shares may result in the loss, suspension or
revocation (or similar action) with respect to any licenses relating to LVI's (or, following the Business Combination, the
Resulting Issuer's) conduct of business (being the conduct of any activities relating to the cultivation, manufacturing and
dispensing of cannabis and cannabis, derived products in the United States, which include the
owning and operating of cannabis licenses) or in LVI (or the Resulting Issuer following the Business Combination) being unable to
obtain any new licenses in the normal course, including, but not limited to, as a result of such person's failure to apply for a
suitability review from or to otherwise fail to comply with the requirements of a governmental authority, as determined by the
LVI Board (or the Resulting Issuer Board following the Business Combination), in its sole discretion, after consultation with
legal counsel and if a license application has been filed, after consultation with the applicable governmental authority.
The Licensing Provisions would provide LVI (or the Resulting Issuer following the Business Combination) with a right, but not
the obligation, at its option, to redeem Subordinate Voting Shares held by an Unsuitable Person at a redemption price equal to
the fair market value of a Subordinate Voting Share (unless otherwise required by a governmental authority). This right is
required in order for LVI (or the Resulting Issuer following the Business Combination) to comply with regulations in various
jurisdictions where LVI (or the Resulting Issuer following the Business Combination) conducts business or is expected to conduct
business, which provide that the shareholders of a company requiring a license who hold over a certain percentage threshold of
shares cannot be deemed "unsuitable" by the applicable governmental authority issuing the license in order for such company's
license to be issued and to remain valid and in effect.
The redemption date will be not less than 30 trading days from the date of the redemption notice unless a governmental
authority requires that the Subordinate Voting Shares be redeemed as of an earlier date, in which case the redemption date will
be such earlier date.
From and after the date the redemption notice is delivered, an Unsuitable Person owning Subordinate Voting Shares called for
redemption will cease to have any voting rights. From and after the redemption date, any and all rights of any nature which may
be held by an Unsuitable Person with respect to such person's Subordinate Voting Shares will cease and, thereafter, the
Unsuitable Person will be entitled only to receive the redemption price, without interest, on the redemption date. LVI's (or,
following the Business Combination, the Resulting Issuer's) redemption right is unilateral. Unless an Unsuitable Person otherwise
disposes of his, her or its Subordinate Voting Shares, such Unsuitable Person cannot prevent LVI (or the Resulting Issuer
following the Business Combination) from exercising its redemption right. Following redemption, the redeemed Subordinate Voting
Shares will be cancelled.
If LVI (or the Resulting Issuer following the Business Combination) exercises its right to redeem Subordinate Voting Shares
from an Unsuitable Person, LVI (or the Resulting Issuer following the Business Combination) may fund the redemption price, which
may be substantial in certain circumstances, from its existing cash resources, the incurrence of indebtedness, the issuance of
additional securities including debt securities, the issuance of a promissory note issued to the Unsuitable Person or a
combination of the foregoing sources of funding.
A holder of the Subordinate Voting Shares will be prohibited from acquiring or disposing of five percent (5%) or more of the
issued and outstanding shares of LVI (or the Resulting Issuer following the Business Combination), directly or indirectly, in one
or more transactions, without providing 15 days' advance written notice to LVI (or the Resulting Issuer following the Business
Combination).
The foregoing description of the terms of the Subordinate Voting Shares does not purport to be complete and is subject to and
qualified in its entirety by reference to the proposed amendments to the articles of the Company attached to the Amendment, a
copy of which is available on SEDAR at www.sedar.com.
Management of the Company recommends that the shareholders vote for the approval of this matter at the Meeting.
Except as described above, the Circular remains unchanged from the version that was mailed to the shareholders of the Company
and previously filed on SEDAR.
ON BEHALF OF THE BOARD
LEAD VENTURES INC.
"Rana Vig"
Rana Vig
President and Chief Executive Officer
Tel. 604.669.9788 Ext. 202
The CSE (operated by CNSX Markets Inc.) has in no way passed upon the merits of the Business Combination and has neither
approved nor disapproved of the contents of this press release.
Disclaimer for Forward-Looking Information
Certain statements in this press release are forward-looking statements and are prospective in nature. Forward-looking
statements are not based on historical facts, but rather on current expectations and projections about future events, many of
which, by their nature, are inherently uncertain and outside of the Company's control and are therefore subject to risks and
uncertainties which could cause actual results to differ materially from the future results expressed or implied by the
forward-looking statements. These statements generally can be identified by the use of forward-looking words such as "may",
"should", "will", "could", "intend", "estimate", "plan", "anticipate", "expect", "believe" or "continue", or the negative thereof
or similar variations. Forward-looking statements in this news release include, but are not limited to, information concerning
the Business Combination, the timing for holding the annual general and special meeting of shareholders of the Company and
expectations regarding the listing of the shares of the Resulting Issuer on the CSE. Those assumptions and factors are based on
information currently available to the Company. Although management of the Company has attempted to identify important factors
that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking
information, there may be other factors that cause results not to be as anticipated, estimated or intended. Among the key factors
that could cause actual results to differ materially from those projected in the forward-looking information and statements are
the following: the ability to consummate the Business Combination; the ability to obtain requisite regulatory and shareholder
approvals and the satisfaction of other conditions to the consummation of the Business Combination on the proposed terms and
timeline; changes in general economic, business and political conditions, including changes in the financial markets; changes in
applicable laws and compliance with extensive government regulation. Should one or more of these risks, uncertainties or other
factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual
results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. There
can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially
from those anticipated in such statements. In particular, there can be no assurance that the Business Combination will occur, or
that if the Business Combination does occur, it will be completed on the terms described above. Accordingly, readers should not
place undue reliance on forward-looking statements and forward-looking information. The forward-looking information contained in
this release is made as of the date hereof and the Company assumes no obligation to update or revise any forward-looking
statements or forward-looking information that are incorporated by reference herein, whether as a result of new information,
future events or otherwise, except as required by applicable securities laws. The foregoing statements expressly qualify any
forward-looking information contained herein. All subsequent written and oral forward- looking information and statements
attributable to the Company or persons acting on its behalf is expressly qualified in its entirety by this notice.
SOURCE Lead Ventures Inc.
View original content: http://www.newswire.ca/en/releases/archive/October2018/05/c8172.html