New LOI Signed to Out-License Lexaria s Technology Kelowna, BC /

New LOI Signed to Out-License Lexaria s Technology

Kelowna, BC / August 30, 2016 / Lexaria Bioscience Corp.

(OTCQB:LXRP) (CSE:LXX) ( the Company or Lexaria ) has entered a new letter of

intent (LOI) to license its proprietary absorption and palatability enhancing

technology for cannabinoids and other bioactive substances. This is the third

LOI that Lexaria has reached with potential licensees so far this year, with one

of those three so far having advanced to a working definitive agreement.

The potential licensee is one of America s most respected and

well-known brands in the cannabis infused products market, active in California

and other U.S. states. The identity of the potential licensee will remain

undisclosed pending further developments.

Under the terms of the LOI, the parties have agreed to perform

due diligence evaluations prior to the possibility of entering a definitive

agreement including development and testing of sample formulations with

Lexaria s enhancements compared to existing branded products. The parties will

establish financial and territory terms upon finalization of the definitive

agreement, pending the outcome of this formulation development and testing to

demonstrate improved product performance to mutual satisfaction.

We are extremely pleased to have reached this LOI with a

recognized leader in the medical and adult use premium marijuana edibles

sector, said John Docherty, President of Lexaria Bioscience Corp. Lexaria

looks forward to conducting the formulation development and testing exercise,

similar to those we performed for our first licensee earlier this year prior to

definitive agreement signing, and we re confident that our technology can offer

enhanced product performance on multiple levels.

The LOI is expected to advance into a definitive agreement

within 90 days though there is no assurance of this. Additional information will

be released regarding the completion of the definitive agreement, and progress

with the formulation development and testing, as details are available. Readers

are cautioned that a definitive agreement has not yet been reached and, even if

reached, much of the financial compensation for Lexaria thereunder shall be

dependent upon the success of the Licensee in selling products enhanced with

Lexaria s technology.

Lexaria Bioscience Corp. is a food sciences company focused on

the delivery of active compounds that can behave as superfoods through its

proprietary infusion technologies. Lexaria s technology enables higher

bioavailability rates for CBD; THC; NSAIDs; Nicotine and other molecules than is

possible without lipophilic enhancement technology. This can allow for lower

overall dosing requirements and/or higher effectiveness in active molecule

delivery. Lexaria hopes to reduce other common but less healthy ingestion

methods such as smoking as it embraces the benefits of public health.

FOR FURTHER INFORMATION PLEASE CONTACT:

Lexaria Bioscience Corp.

FORWARD-LOOKING STATEMENTS

This release includes forward-looking statements. Statements

which are not historical facts are forward-looking statements. The Company makes

forward-looking public statements concerning its expected future financial

position, results of operations, cash flows, financing plans, business strategy,

products and services, competitive positions, growth opportunities, plans and

objectives of management for future operations, including statements that

include words such as "anticipate," "if," "believe," "plan," "estimate,"

"expect," "intend," "may," "could," "should," "will," and other similar

expressions are forward-looking statements, including but not limited to: that

any license arrangements may be entered into with other companies or partners,

that the Company s technology will prove to be beneficial to third parties or to

generate revenue for the Company. Forward-looking statements are estimates

reflecting the Company's best judgment based upon current information and

involve a number of risks and uncertainties, and there can be no assurance that

other factors will not affect the accuracy of such forward-looking statements.

Access to capital, or lack thereof, is a major risk and there is no assurance

that the Company will be able to raise required working capital. Factors which

could cause actual results to differ materially from those estimated by the

Company include, but are not limited to, government regulation, managing and

maintaining growth, the effect of adverse publicity, litigation, competition,

the patent application and approval process and other factors which may be

identified from time to time in the Company's public announcements and filings.

There is no assurance that the participation in the hemp oil sector or

alternative health businesses will provide any benefit to Lexaria, or that the

Company will experience any growth through participation in these sectors. There

is no assurance that the new LOI entered will result in a definitive license

agreement nor that Lexaria will experience any benefit from either the LOI or a

potential definitive agreement. There is no assurance that existing capital is

sufficient for the Company's needs. There is no assurance that any planned

corporate activity, business venture, or initiative will be pursued, or if

pursued, will be successful. There is no assurance that any patent application

in the USA or any other nation or under any treaty will result in the award of

an actual patent; nor that an award of any actual patent will protect against

challenges from unknown third parties. There is no assurance that any of

Lexaria s postulated uses, benefits, or advantages for the patent-pending

technology will in fact be realized in any manner or in any part. No statement

herein has been evaluated by the Food and Drug Administration (FDA).

ViPovaTM products are not intended to diagnose, treat, cure or

prevent any disease.

The CSE has not reviewed and does not accept responsibility

for the adequacy or accuracy of this release.