Emblem Corp.
TSX VENTURE : EMP

December 07, 2016 23:54 ET

Emblem Corp. Announces Completion of Qualifying Transaction, Short Form Offering and Proposed Private Placement

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec. 7, 2016) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

Emblem Corp. (the "Company") (TSX VENTURE:EMP), formerly Saber Capital Corp. (TSX VENTURE:SAB:H), is pleased to announce that it completed its previously announced qualifying transaction (the "Qualifying Transaction") with 9045538 Canada Inc. (formerly Emblem Corp.) ("9045538") and related short form offering document financing. As previously announced on December 5, 2016, in connection with the Qualifying Transaction, effective December 5, 2016, the Company changed its name to "Emblem Corp.", consolidated its common shares ("Common Shares") on the basis of one (1) post-consolidation Common Share for every four (4) pre-consolidation Common Share and continued out of the jurisdiction of the Business Corporation Act (British Columbia) and into the jurisdiction of the Canada Business Corporations Act ("CBCA").

The TSX Venture Exchange (the "Exchange") issued its conditional approval of the Transaction on November 30, 2016. The Common Shares will resume trading on the Exchange under the new ticker symbol "EMP" after the Exchange's conditions for listing are satisfied and the Exchange issues its final exchange bulletin confirming the completion of the Qualifying Transaction.

Pursuant to the Qualifying Transaction, the Company acquired all of the issued and outstanding securities of 9045538. The focus of the Company's business will be producing marihuana from its facility in Paris, Ontario pursuant to the provisions of the Access to Cannabis for Medical Purposes Regulations and the Controlled Drugs and Substances Act (Canada) and its regulations. Additional information in respect of the Company's business is available in the Company's filing statement dated November 30, 2016, available under the Company's profile on www.sedar.com.

As previously announced on November 15, 2016, in connection with the Qualifying Transaction, on November 10, 2016, the Company closed a brokered and non-brokered offering (the "Offering") of subscription receipts (the "Subscription Receipts") to raise an aggregate of approximately $21.6 million. Each Subscription Receipt has been exchanged into units consisting of one Common Share and one-half of one Common Share purchase warrant of the Company (each whole warrant being a "Warrant"). Each Warrant will be exercisable into one Common Share at the exercise price of $1.75 per Common Share for a period of three (3) years from the closing of the Qualifying Transaction. The Subscription Receipts and all underlying securities are subject to a 4 month statutory hold period in accordance with applicable securities laws. The Common Shares issuable upon exercise of the Warrants will also be subject to a 12 month contractual hold period commencing the date of closing of the Qualifying Transaction.

The Qualifying Transaction was carried out by way of a three-cornered amalgamation between 9045538 and a wholly-owned Canadian subsidiary of the Company by way of a plan of arrangement (the "Arrangement") under the provisions of the CBCA. Pursuant to the Qualifying Transaction, the Company acquired all of the issued and outstanding shares of 9045538 and issued to the shareholders of Emblem 37,298,937 Common Shares. Outstanding stock options, warrants, compensation options and special shares of 9045538 have been exchange for securities of the Company having the same terms and conditions as were applicable to such 9045538 securities immediately before the effective time of the Arrangement.

With the completion of the Qualifying Transaction, the Company has 65,154,467 Common Shares issued and outstanding on an undiluted basis (including Common Shares issued under the Offering and the SFOD Financing). The principals of the Company collectively hold 10,001,188 Common Shares which are subject to a Tier 2 Value Security Escrow Agreement pursuant to the policies of the Exchange. In addition, 1,217,038 Common Shares held by non-principals of the Company are subject to a Tier 2 Value Security Escrow Agreements.

Upon completion of the Qualifying Transaction, to the Company's knowledge, no person will beneficially own, directly or indirectly, or exercise control or direction over, shares carrying more than 10% of voting rights attached to each class of the then outstanding Common Shares.

In connection with the completion of the Transaction, the Company is pleased to announce its board of directors as follows: Harvey Shapiro (Chairman), Gordon Fox, Maxim Zavet, John Stewart, Lorne Gertner, Jeffrey Fineberg and Terry Johnson. In addition, the Company is pleased to announce its executive management as follows:

Gordon Fox - President and Chief Executive Officer

Harvey Shapiro - Vice-President and Secretary

Maxim Zavet - Vice President

Daniel Saperia - Chief Operating Officer

John Laurie - Chief Financial Officer

Summaries of the biographies for all of the directors and executive management of the Company are set out in the Filing Statement.

Short Form Offering Document Financing

In connection with the Qualifying Transaction, the Company has completed its previously announced financing of 1,739,130 units (each, a "Unit") at $1.15 per Unit pursuant to a short form offering document dated December 2, 2016 for gross proceeds of approximately $2 million (the "SFOD Financing"). Each Unit consist of one Common Share and one-half of one Common Share purchase warrant of the Company (each a "SFOD Warrant"), with each whole SFOD Warrant entitling the holder to purchase an Common Share at a price of $1.75 per Common Share for a period of 36 months from the closing date of the SFOD Financing.

Pursuant to an agency agreement date November 10, 2016 among the Company, 9045538 and PI Financial Corp. (the "Agent"), the Agent received a commission equal to 8% of the gross proceeds for the Units sold under the Offering, which has been satisfied by issuing units ("Commission Units") at a deemed price equal to the offering price of the Units, being $1.15 per Unit. Each Commission Unit consists of one Common Share and one-half of one Common Share purchase warrant with each whole warrant exercisable at a price of $1.75 per Common Share (an "Agent Warrant"). The Agent's Warrants are on the same terms as the SFOD Warrants.

The proceeds from the SFOD Financing, together with the proceeds from the Offering, will be used to expand production capacity of Emblem, to advance pharmaceutical formulation developments of Emblem and for general corporate purposes of the Company and its subsidiaries.

Non-Brokered Private Placement

The Company is also pleased to announce its intention to complete a non-brokered private placement of units for gross proceeds of up to $800,000 (the "Private Placement"). Each unit will be comprised of one Common Share and one-half of one Common Share purchase warrant with each whole warrant entitling the holder thereof to acquire one Common Share for a period of thirty-six months from the date of issuance at an exercise price of $1.75 per share. Closing of the Private Placement remains subject to approval of the Exchange and other standard closing conditions.

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.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the Qualifying Transaction and has neither approved nor disapproved the contents of this press release.

Neither 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.

This news release contains forward-looking information, which involves known and unknown risks, uncertainties and other factors that may cause actual events to differ materially from current expectation. Emblem cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond Emblem's control. Such factors include those described in the Filing Statement filed with the Canadian Securities Administrators and available on www.sedar.com. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward looking information. Except as required under applicable securities legislation, Saber undertakes no obligation to publicly update or revise forward-looking information.

Investors are cautioned that, except as disclosed in the Filing Statement, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

A halt in trading shall remain in place until after the Transaction is completed or such time that acceptable documentation is filed with the Exchange.

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