Leisure Canada Inc.

May 25, 2011 19:18 ET

Leisure Canada Inc. Announces A Rights Offering

TORONTO, ONTARIO--(Marketwire - May 25, 2011) -


Leisure Canada Inc. (TSX VENTURE:LCN) – Leisure Canada Inc. (the "Company") is pleased to announce the terms of a rights offering to existing shareholders to raise gross proceeds of up to approximately $5.0 million (the "Offering").

The Company will be issuing to eligible holders (the "Eligible Shareholders") of its outstanding class A common shares (the "Common Shares") of the Company of record as at the close of business on June 9, 2011 (the "Record Date"), rights (each, a "Right") to subscribe for up to an aggregate of 41,519,539 Common Shares (such Common Shares being referred to as "Rights Shares"), which represents approximately 25% of the currently issued and outstanding Common Shares. The Offering will be made on the terms set forth in a rights offering circular (the "Circular") to be mailed to Eligible Shareholders and available under the Company's profile on SEDAR at www.sedar.com. Each Eligible Shareholder will receive one Right for each Common Share held on the Record Date. Four Rights will entitle the Eligible Shareholder to purchase one Rights Share at a price of $0.12 per Rights Share.

The Rights expire at 5:00 p.m. (Toronto time) on July 6, 2011 (the "Expiry Date"), after which time unexercised Rights will be void and without value. The Rights will be listed on the TSX Venture Exchange and will trade under the symbol "LCN.RT" until 12:00 p.m. (Toronto time) on the Expiry Date, at which time further trading will be halted.

Fully subscribing Eligible Shareholders may also subscribe for additional Rights Shares that remain unsubscribed on the Expiry Date.

Dundee Securities Ltd. ("Dundee Securities") has agreed to act as soliciting dealer for the purpose of soliciting the exercise of Rights Shares in those jurisdictions in which the Offering is made. Dundee Securities has also agreed to act as advisor to the Company in connection with the Offering and to purchase or cause to be purchased, on a reasonable best efforts basis, up to all of the Rights Shares not otherwise purchased under the Offering.

The completion of the Offering is not conditional upon the Company receiving any minimum amount of subscriptions from Eligible Shareholders.

No Rights will be issued to shareholders who are residents of any jurisdiction other than each of the provinces and territories of Canada and such other jurisdiction outside of Canada and the United States where the issue of Rights would not be unlawful. Reference is made to the section in the Circular entitled "Details of the Rights Offering - Ineligible Shareholders".

Net proceeds of the Offering will be up to approximately $4.5 million, assuming that all of the Rights are exercised. Proceeds of the Offering will be added to the general funds of the Company and will be used for working capital purposes.

This news release does not constitute an offer to sell or the solicitation of an offer to buy any of these securities in the United States. Securities may not be offered or sold in the United States absent registration under the United States Securities Act of 1933, as amended, and applicable state securities laws, or an available exemption from such registration requirements.

On Behalf of the Board of Directors

Robin Conners, President and CEO

About Leisure Canada Inc.

Leisure Canada Inc. is a publicly traded company, incorporated under the laws of Ontario and listed on the TSX Venture Exchange under the symbol "LCN". The Company is engaged in the business of developing hotel, resort and commercial properties in Cuba through its wholly-owned subsidiary, Wilton Properties Ltd. ("Wilton"), in joint venture with Grupo Hotelero Gran Caribe S.A. ("Gran Caribe"), an agency of the Cuban government.

For further information on the Company please visit our website at www.leisurecanada.com. The Company's public filings, including its most recent audited consolidated financial statements, can be reviewed on the SEDAR website (www.sedar.com).

This news release may contain forward-looking statements and information within the meaning of applicable securities legislation. These forward-looking statements reflect management's current expectations, estimates, projections, beliefs and assumptions that were made using information currently available to management. In some cases, forward-looking statements can be identified by terminology such as "may", "will", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "forecast", "outlook", "potential", "continue", "should", "likely" or the negative of these terms or other comparable terminology. Although management believes that the anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve assumptions, known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking statements and information.

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 and accuracy of this release.

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