Emblem Corp. Announces Closing of $15.9 Million Financing

Press Release

TORONTO, ONTARIO – (Marketwired – Jan. 31, 2017) – NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

Emblem Corp. (the “Company”) (TSX-V: EMC) is pleased to announce that is has closed its previously announced bought deal private placement (the “Offering”) of 4,385,668 special warrants of the Company (the “Special Warrants”) at a price of $3.63 per Special Warrant for aggregate gross proceeds of $15,919,974.84. The Offering was led by PI Financial Corp., on behalf of a syndicate of underwriters that included Canaccord Genuity Corp. and GMP Securities L.P. (collectively, the “Underwriters”). The Offering included the sale by the Company of 552,874 Special Warrants issued pursuant to the exercise by the Underwriters of the previously granted Underwriters’ option to purchase up to an additional 15% of the base offering of Special Warrants.

As previously announced, each Special Warrant not previously exercised will be automatically exercised, without payment of additional consideration, on the earlier of: (i) the Qualification Deadline (as defined below); and (ii) the third business day after the Prospectus Qualification (as defined below). The holders of Special Warrants will receive, upon such deemed exercise and for no additional consideration, one unit of the Company (the “Units”) for each Special Warrant held. Each Unit will be comprised of one common share of the Company (the “Common Shares”) and one-half of one common share purchase warrant (each whole warrant, a “Warrant”). Each Warrant will entitle the holder to purchase one Common Share at an exercise price of $4.75 for a period of 36 months from the date of closing of the Offering. The Warrants are subject to an accelerated expiry date upon notice from the Company if the volume weighted average trading price of the Common Shares is equal to or greater than $7.00 over a period of ten consecutive trading days.

The Company has agreed to use its best efforts to obtain a receipt for a final short form prospectus qualifying the distribution of the Units upon exercise of the Special Warrants (the “Prospectus Qualification“) on or before March 17, 2017 (the “Qualification Deadline“). If the Prospectus Qualification does not occur before the Qualification Deadline, each holder shall be entitled to receive, without payment of additional consideration, 1.05 Units per Special Warrant. Unless the Prospectus Qualification occurs, securities issued in connection with the Offering will be subject to a 4-month hold period from the date of issue.

The Company intends to use the net proceeds of the Offering (including any proceeds received as a result of the exercise of the Underwriters’ option) to fund the planned expansion of its facility in Paris, Ontario and for general corporate purposes.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

About Emblem

Emblem is licensed under the Access to Cannabis for Medical Purposes Regulations (the “ACMPR”) to cultivate and sell medical marihuana. Emblem carries out its principal activities producing marihuana from its facilities in Paris, Ontario pursuant to the provisions of the ACMPR and the Controlled Drugs and Substances Act (Canada) and its regulations.

For further information contact:

Ali Mahdavi
(416) 962-3300
am@spinnakercmi.com