Mr. Thomas Smeenk reports

BROADWAY GOLD MINING LTD ANNOUNCES PROPOSED ACQUISITION OF MEDCOLCANNA (BVI) CORP. AND RELATED FINANCING TRANSACTIONS

Broadway Gold Mining Ltd. has entered into a binding letter agreement with Medcolcanna (BVI) Corp., a privately held issuer existing under the laws of the British Virgin Islands, which outlines the general terms and conditions pursuant to which Broadway and Medcolcanna have agreed to complete a transaction that will result in a reverse takeover of Broadway by the current shareholders of Medcolcanna. The letter agreement was negotiated at arm's length and is effective as of Oct. 18, 2018.

Medcolcanna's wholly owned Colombian subsidiary, Medcolcanna SAS, is in the process of establishing operations in Colombia as a producer of both tetrahydrocannabinol (THC) and cannabidiol (CBD) medical cannabis. Medcolcanna intends to combine its scientific expertise and Colombia's inherent agricultural advantages of cost and high-quality cannabis that arise from consistent 12 hours of daylight year-round, minor seasonal temperature fluctuations, a strong history of agricultural exports, fertile soil, and an available, low-cost and experienced labour force. Its business plan forecasts leveraging its team's international business expertise, particularly in trading, sales and marketing, its agronomic knowledge, and Colombia's agricultural advantages.

Medcolcanna SAS has received three licences for the: (1) cultivation of psychoactive (high THC) medical cannabis; (2) cultivation of non-psychoactive (less than 1 per cent THC) medical cannabis; (3) production, domestic distribution and international export of both THC and cannabidiol medical cannabis. Medcolcanna SAS has four hectares of land approved for the planting of medical cannabis crops, located in a very secure area close to Bogota, upon which it plans to immediately start construction of facilities and greenhouses, which, ultimately, may include cornerstone public facilities. Medcolcanna SAS also has options on an additional 120 hectares of land, allowing it to rapidly expand as the business grows.

Duane Parnham, chairman of Broadway, commented: "We are extremely pleased to have reached agreement with Medcolcanna and look forward to closing the transaction and bringing value to Broadway's and Medcolcanna's shareholders. We have every confidence in Felipe and his team, all of whom will be based in Colombia, and in their abilities and business plan."

Terms of the transaction and financing matters

It is currently anticipated that the proposed transaction will be effected by way of a share exchange or other similar form of transaction as is acceptable to the parties. There are currently outstanding an aggregate of 42,459,204 common shares in the capital of Broadway and 39,362,659 common shares in the capital of Medcolcanna. Additionally, Broadway has outstanding approximately 20,559,000 share purchase warrants exercisable at prices ranging from 10 cents to $1.60 and 3,765,000 stock options exercisable at prices ranging from five cents to 43 cents, and Medcolcanna has 3,681,330 share purchase warrants outstanding, with each Medcolcanna warrant being exercisable into one Medcolcanna share at an exercise price of 25 cents for a period of 12 months from the date of issuance thereof.

Pursuant to the proposed transaction, the holders of the issued and outstanding Medcolcanna shares shall receive one postconsolidation (as defined as follows) Broadway common share for each Medcolcanna common share held. As well, Broadway has agreed to seek shareholder approval for, among other things: (i) the consolidation of its outstanding shares, warrants and options on a one-new-share-for-nine-old-share basis; and (ii) subject to TSX Venture Exchange approval, the spinout to Broadway's existing shareholders of all of the mining assets related to its Broadway and Madison mine.

On or immediately prior to the completion of the proposed transaction, it is anticipated that Broadway will effect: (i) the consolidation; (ii) the spinout; and (iii) the name change (as defined as follows). Additionally, the board of directors of Broadway shall be reconstituted to consist of nominees of Medcolcanna and all existing officers of Broadway shall resign and be replaced by nominees of Medcolcanna, as further described as follows.

Medcolcanna completed in September, 2018, a non-brokered private placement of 7,362,659 units at a price of nine cents per Medcolcanna unit for aggregate gross proceeds of $662,639. Each Medcolcanna unit consisted of one Medcolcanna share and one-half of one Medcolcanna warrant, with each whole Medcolcanna warrant being exercisable into one Medcolcanna share at an exercise price of 25 cents for a period of 12 months following issuance. The proceeds of such financing are being used for working capital purposes and to pay for costs associated with acquiring Medcolcanna SAS.

Prior to the completion of the transaction, it is anticipated that Medcolcanna will complete two additional securities offerings as follows:

• Medcolcanna intends to complete a non-brokered offering of one million Medcolcanna units at a price of nine cents per unit for gross proceeds of approximately $90,000. Each Medcolcanna unit will consist of one Medcolcanna share and one-half of one Medcolcanna warrant, with each whole Medcolcanna warrant being exercisable into one Medcolcanna share at an exercise price of 25 cents for a period of 12 months following issuance.
• Medcolcanna anticipates completing a brokered private placement of approximately 20 million subscription receipts at a price of 25 cents per subscription receipt for gross proceeds of approximately $5-million. It is anticipated that each subscription receipt shall entitle the holder to receive, upon satisfaction of certain escrow release conditions and without payment of additional consideration, one unit in the capital of Medcolcanna. Each unit shall consist of one Medcolcanna share and one-half of one Medcolcanna share purchase warrant, which units shall be exchanged, without further consideration, for one unit in the capital of the resulting issuer (as defined herein), upon the completion of the proposed transaction. Following the exchange for units of the resulting issuer, each warrant of the resulting issuer shall entitle the holder thereof to acquire one common share of the resulting issuer at a price of 40 cents per resulting issuer share for a period of 24 months following issuance.

If and when completed, the net proceeds from the non-brokered and brokered offerings will be used to expand the business of Medcolcanna, for working capital and for general corporate purposes. The proceeds of the non-brokered offering will be immediately available to Medcolcanna for working capital purposes.

Further details regarding the brokered offering will be included in a subsequent news release once additional details become available. Upon completion of the transaction, and assuming the maximum gross proceeds in the offerings are raised, there will be 65,080,348 postconsolidation common shares of the combined entity issued and outstanding, of which it is expected that the current shareholders of Broadway will hold approximately 7.2 per cent, purchasers in the offerings will hold approximately 32.3 per cent and the former shareholders of Medcolcanna will hold approximately 60.5 per cent.

The proposed transaction is subject to requisite regulatory approvals and standard closing conditions, including the approval of the directors of each of Broadway and Medcolcanna of a definitive agreement in respect of the transaction as well as the conditions described as follows. The obligations of Broadway and Medcolcanna pursuant to the letter agreement shall terminate in certain specified circumstances, including in the event that the definitive agreement is not executed by Oct. 31, 2018.

Upon completion of the transaction, it is the intention of the parties that the resulting issuer will continue to focus on the current business and affairs of Medcolcanna SAS.

Insiders, officers and board of directors of the resulting issuer

It is expected that, upon completion of the transaction, the resulting issuer will have a board of five individuals, all of whom shall be nominated by Medcolcanna. As of the date hereof, and subject to regulatory approval, Medcolcanna anticipates that the resulting issuer will have the following officers and directors (with additional board nominees to be named later).

Felipe de la Vega -- president, chief executive officer and director

Mr. de la Vega was the founder of Trenaco Holdings Group, a major Latin American commodity trading company with revenues of $800-million (U.S.) in 2014. As chief executive officer of Trenaco for 10 years, he developed strong relationships with domestic and global commodities companies and vertically integrating the value chain through the acquisition of profitable assets such as coal mines, metcoke ovens, quality labs, stockyards and transportation infrastructure. Under Mr. de la Vega, Trenaco became the second-largest exporter of coking coal in Colombia and was the 17th-largest Colombian exporter and 76th-largest Colombian company for 2013 to 2014 as well as being ranked first for growth prospects.

Chris Reid -- chief financial officer

Mr. Reid has served as the chief executive officer and president of Petrodorado Energy Ltd., a petroleum company with operations in Colombia, since January, 2016, and as the chairman since May, 2016. Mr. Reid also served as the chief financial officer from February, 2012, to January, 2016, where he was involved in the successful turnaround of the company through a divestiture program. Mr. Reid is a chartered professional accountant whose career includes 12 years of experience in industry and international business. Mr. Reid is currently a director Soperior Fertilizer Corp. (formerly Potash Ridge Corp.), and Petrodorado Energy Ltd. Mr. Reid is a member of the Institute of Chartered Accountants of Alberta and the Chartered Professional Accountants of Alberta. Mr. Reid holds a bachelor of business administration from Saint Francis Xavier University.

Nicolas Rodrigues -- chief operating officer

Mr. Rodrigues is an agricultural engineer with more than 13 years of experience leading innovation and business development in the agricultural industry. He has strong leadership skills and technological knowledge in agricultural production. Mr. Rodrigues previously held the position of general manager at the Clinton Giustra Enterprise Partnership, a social business builder that brings entrepreneurial solutions to agribusinesses, farmers and fishermen.

Robert James Metcalfe -- director

Mr. Metcalfe, a lawyer, was senior partner with the law firm Lang Michener LLP for 20 years. He is the former president and chief executive officer of Armadale Properties and counsel to all of the Armadale Group of Companies, with significant holdings across numerous industries, including finance, construction of office buildings, airport ownership, management and refurbishing, land development, automotive dealerships, as well as newspaper, radio and television stations. Mr. Metcalfe has served as president, chief executive officer, lead director, chairman and committee member on numerous publicly listed natural resource and industry company corporate boards in Canada, the United States, England, South America and Africa. As director and shareholder, Mr. Metcalfe has been engaged in numerous acquisitions, divestitures, corporate reorganizations, financings and corporate improvements as well as serving on numerous special committees across many sectors. He is a member of the Institute of Corporate Directors and a member in good standing of the Law Society of Upper Canada.

Thor Borresen -- director

Mr. Borresen is an industrial engineer from the Javeriana University in Cali, Colombia, and is currently the marketing vice-president of Bavaria, the Colombian operation of AB-InBev, the world's leading brewer. In his current position, he is responsible for leading the development of a complete portfolio of local and international beer brands, boosting category growth, and building the equity of the brands. His main challenge is to keep the category alive and relevant among young adults through a strategy of brand renovation, innovation, and digital connection with consumers and stakeholders. His professional career spans over 14 years in different commercial roles. Before joining Bavaria, he was part of the marketing team in Kraft Foods Colombia and Venezuela, overseeing local and regional markets. Recently, he led the development and launch of a new business unit -- The High End Company, integrating the roles of sales, marketing, finance and logistics for a group of global and craft brands.

Conditions to the transaction

Completion of the transaction will be subject to a number of conditions of closing that are customary for a transaction of this nature, including, without limitation:

• Broadway shall obtain receipt of requisite shareholder approvals in connection with the following matters: (i) the consolidation; (ii) the spinout; (iii) a change of name to Medcolcanna Organics Corp. or such other name as may be requested by Medcolcanna and acceptable to applicable regulatory authorities; (iv) the election of the directors of the resulting issuer to replace the current directors of Broadway immediately following the completion of the proposed transaction; and (v) the approval of the transaction, if required by regulatory authorities;
• Completion of the offerings;
• Broadway and Medcolcanna entering into the definitive agreement;
• The common shares of the resulting issuer having been approved for listing on the TSX Venture Exchange or another recognized Canadian stock exchange.

The definitive agreement, once completed, will be filed under Broadway's issuer profile on SEDAR.

Intercompany relationships

Officers, directors and principal shareholders of Broadway may subscribe for subscription receipts in the offering.

About Broadway Gold Mining Ltd.

Until execution of the letter agreement, Broadway was focused on the exploration and development of the Broadway and Madison mine and the delineation of the porphyry source of its mineralization; the company's right, title and interest to the Broadway and Madison mine -- 450 acres of land, a 192-acre ranch, buildings, mine equipment and fixtures, six patented and 35 unpatented mineral claims, and mineral rights to a four-square-mile property in the Butte-Anaconda region of Montana, a porphyry-based mining district -- will be spun out to Broadway's current shareholders as a result of the transaction. Assuming completion of the transaction, Broadway will have acquired the business of Medcolcanna, will be a cultivator, manufacturer and distributor of medicinal cannabis based in Colombia, and is expected to be a life sciences issuer under the policies of the TSX-V.

Broadway anticipates it will be seeking to rely on an exemption, or a waiver, from the sponsorship requirements of the TSX-V.

Further information

All information contained in this news release with respect to Broadway and Medcolcanna was supplied by the parties, respectively, for inclusion herein, and each party and its directors and officers have relied on the other party for any information concerning the other party.

We seek Safe Harbor.