Gabriella’s Kitchen Inc. (“GABY” or the “Company“) (CSE: GABY) (OTCQB: GABLF), is pleased to announce that further to its May 3, 2019 press release where the Company announced an agreement to issue up to C$10,000,000 of units of the Company (the “Units“) at a price of C$0.30 per Unit (the “Offering Price“) on a marketed, “best efforts” private placement basis, the Company has agreed with a syndicate of agents led by GMP Securities L.P. (collectively, the “Agents“) to issue on a marketed, “best efforts” private placement basis, up to C$20,000,000 of Units at the Offering Price (the “Offering“). The Offering has been structured with a base of up to C$16,000,000 and includes an over-allotment option of up to C$4,000,000. Each Unit will consist of one common share (a “Common Share“) and one-half common share purchase warrant of the Company (each whole warrant, a “Warrant“). Each whole Warrant will be exercisable to acquire one Common Share (a “Warrant Share“) for a period of two years following the Closing Date (as hereinafter defined) of the Offering at an exercise price of C$0.38 per share, subject to adjustment in certain events.

Margot Micallef, Founder and CEO of GABY, commented, “We have received overwhelming interest in our recently announced private placement and are excited to double our original offering to C$20,000,000. This financial support will allow us to continue our rapid expansion, realize our anticipated organic growth, and accelerate our acquisition strategy so that we can further our goal of being the dominant house of brands in the California market,” furthering that, “this upsized offering will also enable us to expand into other markets both with our CBD strategy and our regulated products.”

The net proceeds from the Offering will be used for capital expenditures, potential acquisitions, brand and sales investment, working capital, and general corporate purposes.

Closing of the Offering is expected to occur on or about June 12, 2019 (the “Closing Date“). The Offering is in the form of a best efforts private placement pursuant to applicable exemptions from the prospectus requirements in all of the Provinces of Canada to “accredited investors” within the meaning of National Instrument 45-106. The Agents are also entitled to offer the Units for sale in the United States only to Qualified Institutional Buyers (within the meaning of Rule 144A) and/or Accredited Investors (within the meaning of Rule 501(a) of Regulation D) pursuant to available exemptions from the registration requirements of the Securities Act of 1933, as amended (the “United States Securities Act“), and in each case in compliance with the securities laws of the applicable States of the United States. The Agents may also offer the Units for sale outside Canada and the United States provided no prospectus offering or comparable obligation arises in such other jurisdiction.

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

The Company anticipates that a portion of the Units will be sold to the directors, officers, or other insiders of the Company, who are related parties of the Company pursuant to Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (“MI 61-101“), therefore the Offering may constitute a “related party transaction” within the meaning of MI 61-101. In its consideration and approval of the Offering, the board of directors of the Company determined that the Offering will be exempt from the formal valuation and minority approval requirements of MI 61- 101 on the basis that the fair market value of the Offering to related parties is not expected to exceed 25% of the market capitalization of the Company, in accordance with Sections 5.5 and 5.7 of MI 61-101.

All securities issued under the Offering will be subject to a four month and one day hold period under applicable securities laws. The Offering is subject to a number of conditions, including, without limitation, receipt of all regulatory approvals, including but not limited to the approval of the Canadian Securities Exchange (the “CSE“).

SOURCE Gabriella’s Kitchen