LGC Capital to enter into Convertible Loan Agreement for US$2,340,000

/NOT FOR DISTRIBUTION IN THE UNITED STATES/

MONTREAL, Feb. 19, 2019 /CNW Telbec/ - LGC Capital Ltd. (TSXV: LG) and (OTC-PINK: LGGCF) ("LGC" or the "Corporation") is pleased to announce that it will enter into an investment agreement (the "Investment Agreement") with international investors YA 11, PN, Ltd. and RiverFort Global Opportunities PLC (the "Lenders") pursuant to which they will loan LGC an aggregate amount of US$2,340,000 (the "Loan").  The Loan will have a term of 12 months and will bear interest at an annual rate of 12% The proceeds of the loan will be used to refinance upcoming debt maturity.

The principal amount of the Loan will be convertible into common shares of LGC (the "Shares") at the option of the Lenders at a price per Share equal to the lesser of (i) US$0.0912 (CAD$0.120), representing the US dollar equivalent of 120% of CAD$0.10; and (ii) 90% of the lowest daily VWAP during the five trading days immediately preceding the date of the conversion notice from the Lenders, subject to a minimum conversion price of US$0.076, representing the US dollar equivalent of CAD$0.10.  The closing price of the Shares on February on February 15, 2019 was CAD$0.09.

The Corporation will also issue common share purchase warrants (the "Warrants") to the Lenders in an amount equal to 45% of the principal amount of the Loan divided by US$0.0874, representing the US dollar equivalent of CAD$0.115.  Each Warrant shall entitle the holder thereof to acquire one Share at an exercise price of CAD$0.115, for a period of one year from the date of issuance.

The Investment Agreement contains standard representations, warranties and covenants of the parties.  Closing of the transaction and the issuance of all Shares pursuant thereto is subject to the conditional approval of the TSX Venture Exchange. The parties intend to close the transaction as soon as reasonably possible following the receipt of such approval.  Any securities issued by the Corporation at the closing of the transaction or upon conversion of the Loan or upon exercise of the Warrants, will be subject to restrictions on resale for a period of four months and one day from the date of closing.  LGC is at arm's length to the Lenders and Riverfort Global Capital Ltd.

About LGC Capital Ltd (www.lgc-capital.com)

LGC Capital is a leading cannabis investment firm with a focus on the Legal Global Cannabis market.  Through its growing portfolio investment companies, LGC is building a vertically integrated system of interconnected legal cannabis companies with cultivation, processing and distribution in Australia, Jamaica, Switzerland, Italy, and Canada serving domestic and export markets. LGC Capital Ltd. is a Canadian incorporated public company listed on the TSX Venture Exchange.

Through its partners and assuming pending transactions under review by the TSXV are approved, LGC presently will have interests in over 450,000 square feet of planted cannabis in Jamaica, Switzerland, Italy, and Australia. That is expected to increase to over 2,100,000 square feet by 2021, as its portfolio companies execute their expansion plans, in addition to the anticipated licensing of Tricho-Med's operations in Quebec, Canada.

LGC partners currently sell cannabis products in over 1,000 points of sale across Switzerland and Italy under the ONE Premium Cannabis and EasyJoint brands as well as medical cannabis oils in Australia under the Little Green Pharma brand. LGC's partners' branded products are available in a variety of formats including dry cannabis flower, tinctures, oils, seeds, and beverages.

Notice Regarding Forward Looking Statements

This press release may contain forward-looking statements with respect to LGC Capital Ltd. ("LGC"), its operations, strategy, investments, financial performance and condition, and the Investment Agreement referred to above. These statements can generally be identified by use of forward- looking words such as "may", "will", "expect", "estimate", "anticipate", "intends", "believe" or "continue" or the negative thereof or similar variations. The actual results and performance of LGC could differ materially from those expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Some important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, competition, government regulation and the factors described under "Risk Factors and Risk Management" in LGC's Management's Discussion and Analysis for the three and nine months ended June 30, 2018, as filed on SEDAR (www.sedar.com). The cautionary statements qualify all forward-looking statements attributable to LGC and persons acting on its behalf. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release, and LGC has no obligation to update such statements, except to the extent required by applicable securities laws. 

Caution Regarding Press Releases

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

SOURCE LGC Capital Ltd

Chief Executive Officer, John McMullen, [phone], [email protected]; Chief Financial Officer, Anthony Samaha, [phone], [email protected]; Investor Relations, Dave Burwell, [phone], [email protected]