Emblem Completes Bought Deal Financing

Press Release

TORONTO, Ontario, November 16, 2017 – Emblem Corp. (TSXV:EMC) (EMC.WT) (“Emblem” or the “Company“) is pleased to announce that it has closed its previously announced bought deal short form prospectus offering, including the exercise in full of the underwriters’ over-allotment option (the “Offering“). In connection with the Offering, the Company issued 7,885,734 units of the Company (the “Units“) and 15,000 8.0% convertible unsecured debentures of the Company due in 2020 (the “Convertible Debentures“). The Units were sold at a price per Unit of $1.75 for gross proceeds of $13,800,034.50 and the Convertible Debentures were sold at a price per Convertible Debenture of $1,000 for gross proceeds of $15,000,000, for total aggregate gross proceeds of $28,800,034.50. The Offering was underwritten by a syndicate of underwriters led by Eight Capital and included Canaccord Genuity Corp., Echelon Wealth Partners Inc. and GMP Securities L.P. (collectively, the “Underwriters“).

Each Unit consisted of one common share in the capital of the Company and one common share purchase warrant (each, a “Warrant“). Each Warrant will entitle the holder thereof to acquire, subject to adjustment in certain circumstances, one additional common share in the capital of the Company at an exercise price of $2.15 per share until November 16, 2020.

The Convertible Debentures will bear interest at an annual rate of 8.00% payable in arrears in equal installments semi-annually. The maturity date of the Convertible Debentures will be November 16, 2020 (the “Maturity Date“). Each Convertible Debenture will be convertible at the holder’s option into common shares in the capital of the Company (the “Conversion Shares“) at any time prior to the close of business on the business day immediately preceding the Maturity Date at a conversion price (the “Conversion Price“) of $1.95 per Conversion Share, subject to adjustment in certain events as described in a debenture indenture dated as of November 16, 2017 entered into between the Company and Computershare Trust Company of Canada (the “Indenture“). Pursuant to the terms of the Indenture, the Company may require the conversion of all of the principal amount of the then outstanding Convertible Debentures at the Conversion Price on not less than thirty days’ notice should the daily volume weighted average trading price of the outstanding common shares of the Company on the TSX Venture Exchange be greater than $2.93 for any ten consecutive trading days.

Ninety percent of the net proceeds from the Offering are expected to be allocated toward the currently unfunded portion of the planning, design, development, construction and implementation (including the purchase of certain designated capital equipment) of the Company’s new facility which is expected to be comprised of up to approximately 120,000 square feet of greenhouse space and 50,000 square feet of infrastructure space. Although no specific investments are currently contemplated, it is expected that approximately ten percent of the net proceeds will be invested in, among other things, medical marijuana related technologies, seeds, clinical trials, genetics and research and development initiatives or other infrastructure, all within the industry. For additional details regarding the use of proceeds of the Offering, please see the Company’s short form amended and restated prospectus dated November 15, 2017 which is available under the Company’s profile at SEDAR at www.sedar.com.

The securities offered in the Offering have not been, and will not be, registered under the U.S. Securities Act or any U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, United States persons absent registration or any applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor will there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About Emblem

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

Forward-looking statements

This news release may contain “forward-looking information” and “forward-looking statements” within the meaning of applicable Canadian securities legislation, including, without limitation, statements regarding the use of proceeds from the Offering and the future results of operations, performance and achievements of the Company. All information contained herein that is not clearly historical in nature may constitute forward-looking information. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive risks, uncertainties and contingencies that may cause actual financial results, performance or achievements to be materially different from the estimated future results, performance or achievements expressed or implied by those forward-looking statements and the forward-looking statements are not guarantees of future performance. Except as required by law, the Company disclaims any obligation to update or revise any forward-looking statements. Readers are cautioned not to put undue reliance on these forward-looking statements. This news release contains information obtained by the Company from third parties and believes such information to be accurate but has not independently verified such information.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For further information contact:

Ali Mahdavi
Emblem Corp.
(416) 962-3300