Mr. Rob Fia reports

CITY VIEW ANNOUNCES SPIN-OUT OF CANNIBIS ASSETS TO EXISTING SHAREHOLDERS

City View Green Holdings Inc. has executed a definitive arrangement agreement with City View's subsidiary, 2590672 Ontario Inc. (259 OnCo), in respect of the spinout of its cannabis assets, to its shareholders by way of a share capital reorganization effected through a statutory plan of arrangement pursuant to the arrangement provisions of the Business Corporations Act (British Columbia). Under the arrangement, City View will distribute the common shares of 259 OnCo to City View shareholders.

Under the arrangement, City View's current shareholders will receive 259 OnCo shares by way of a share exchange, pursuant to which each existing common share of 259 OnCo will be exchanged for one new common share of City View and 0.032 of a 259 OnCo share, or as otherwise determined by the board of directors of the company. On completion of the arrangement, City View shareholders will maintain their interest in City View and will obtain a proportionate interest in 259 OnCo.

The reorganization will be effected pursuant to Section 289 of the Act and must be approved by the Supreme Court of British Columbia and by the affirmative vote of 66-2/3rds per cent of City View's shareholders in attendance at a shareholder meeting to be held on or before Dec. 31, 2025.

Rob Fia, chief executive officer, commented: "The proposed spinout of City View Green Holdings Inc.'s cannabis assets in subsidiary 259 OnCo offers several potential benefits for shareholders. By separating 259 OnCo into a new, independently listed entity, both the core change of business entity and the cannabis business can pursue focused growth strategies tailored to their respective markets. Crucially, 259 OnCo would expect to retain significant non-capital tax losses of approximately $25.5-million, which expire between 2034 and 2044, which could be strategically utilized to offset future taxable income generated by its remaining cannabis operations, providing a substantial financial advantage. On Nov. 27, 2024, City View announced a shares-for-debt settlement with creditors that removed $2,342,513.37 of indebtedness from the balance sheet. Furthermore, the spinout could unlock greater value for shareholders by allowing the market to more clearly assess the distinct potential of each business, potentially leading to improved valuations compared to the current combined entity. This separation could also attract different investor bases with specific interests in the core change of business entity or cannabis entity, potentially increasing overall investment and liquidity for both companies."

It is currently contemplated that 259 OnCo will apply for the listing of the 259 OnCo shares on the Canadian Securities Exchange following the arrangement; however, 259 OnCo will not be listed on a stock exchange upon completion of the arrangement. The listing of 259 OnCo shares is subject to meeting all the conditions for listing established by the CSE and acceptance by the CSE. There is no assurance that 259 OnCo shares will list on the CSE.

In connection with the arrangement, the company has agreed to provide a bridge loan of up to $500,000 to 259 OnCo. The bridge loan shall be for a term for 24 months at an interest rate of 10 per cent per annum. The bridge loan shall be structured as a demand note, whereby 259 OnCo can draw down on the bridge loan upon notice to City View.

Completion of the arrangement is subject to a number of conditions, including the following: (a) City View shareholder approval at the meeting; (b) the approval of the Supreme Court of British Columbia; and (c) other conditions precedent as set forth in the arrangement agreement.

Additional details of the spinout transaction will be included in an information circular to be mailed to shareholders of City View in connection with the meeting. The arrangement is expected to close in 2025.

Further to the press release on April 3, 2025, City View also intends to refocus its business operations from a cannabis issuer to an investment issuer. As part of the proposed change of business, City View entered into an agreement of principle with an arm's-length party, whereby the company will acquire an ownership interest in the target in exchange for the issuance of shares in the capital of City View.

City View is still in conducting its due diligence investigations of the target and no definitive agreement has been entered into between City View and the target and there can be no assurance that any agreement will be entered into.

Recently, the target has gained traction by connecting brands with on-line creators and influencers. Since its launch, the target has now surpassed 40 million total ad impressions, demonstrating its growing reach and effectiveness in the live-streaming ecosystem. In addition, the target's ad platform has also experienced creator adoption, with over 3,000 registered creators. These creators have collectively powered over 2,200 unique live streams featuring integrated brand advertising, highlighting the platform's active and engaged community.

Completion of the proposed change of business is subject to a number of conditions, including the acceptance and approval of City View's disclosure document by the CSE and shareholder approval. The proposed change of business cannot close until the required shareholder approval is obtained. There can be no assurance that the proposed change of business will be accepted by the CSE and/or completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular and/or listing statement to be prepared in connection with the proposed change of business, any information released or received with respect to the proposed change of business may not be accurate or complete and should not be relied upon. Trading in the securities of City View should be considered highly speculative.

We seek Safe Harbor.