News

Rougemont, Quebec, July 29, 2019 – Lassonde Industries Inc. (TSX: LAS.A) (Lassonde or the Company) reports that it has acquired 36,900,000 common shares (Common Shares) in the capital of Diamond Estates Wines & Spirits Inc. (Diamond Estates) by way of a private placement (the Private Placement) at a price of $0.19 per Common Share for aggregate proceeds of approximately $7,011,000 pursuant to the terms of a subscription agreement (Subscription Agreement) entered into with Diamond Estates on the date hereof. The head office of Diamond Estates is located at 1067 Niagara Stone Road. Niagara-on-the-Lake, Ontario, L0S 1J0.

Immediately prior to the completion of the Private Placement, Lassonde did not hold any Common Shares. Immediately following the completion of the Private Placement, Lassonde held approximately 19.9% of the issued and outstanding Common Shares as at such time.

The Private Placement was completed for business and investment purposes. Depending on market conditions and other relevant factors, Lassonde may, in the future, increase or decrease its ownership in Diamond Estates, directly or indirectly.

In connection with the Private Placement, Lassonde and Diamond Estates entered into an investor rights agreement (the Investor Rights Agreement), pursuant to which Lassonde was granted certain nomination, anti-dilution, registration, and governance rights.

Lassonde will have the right to designate two (2) nominees out of a total of seven (7) to the Diamond Estates board so long as the number of Common Shares beneficially owned or controlled by Lassonde represents at least 15% or more of the Common Shares. If at any time Lassonde beneficially owns or controls less than 15% but more than 10% of the Common Shares, Lassonde will have the right to designate one (1) nominee to the Diamond Estates board. In connection with the Private Placement, Lassonde and Diamond Estates entered into the Investor Rights Agreement. In connection with the Investor Rights Agreement, the number of directors on the Diamond Estates Board shall be increased from six (6) to seven (7) and one director of Diamond Estates shall resign, which vacancy shall be filled by a Lassonde nominee.

The Investor Rights Agreement shall be effective so long as Lassonde holds at least 10% of the issued and outstanding shares of Diamond Estates.

In connection with the Private Placement, Lassonde and Diamond Estates also entered into a broker agreement pursuant to which Diamond Estates agreed to appoint Lassonde as Diamond Estates’ exclusive representative with certain retailers, including grocery stores and convenience stores located in Canada.

A copy of Lassonde’s early warning report will be filed with applicable securities commissions and will be made available on SEDAR at www.sedar.com, a copy of which may be obtained by contacting Sylvain Morissette, Vice President Communications at (450) 469-0856 extension 10265.