Press Release

Pollard Banknote Limited Announces $33.2 Million Bought Deal Financing

WINNIPEG, Manitoba, February 1, 2018 /CNW/ Pollard Banknote Limited (TSX: PBL) (“Pollard Banknote” or the “Company”), a leading lottery partner that provides instant tickets, interactive solutions, and marketing support, is pleased to announce that it has entered into an agreement with a syndicate of underwriters led by Canaccord Genuity Corp. (together, the “Underwriters”) to purchase on a bought deal basis 1,800,000 common shares of Pollard Banknote (“Common Shares”) at a price of $18.45 per Common Share (the “Offering Price”) for gross proceeds to the Company of approximately $33.2 million (the “Offering”).

The Company has granted the Underwriters an over-allotment option exercisable at any time up to 30 days following the closing of the Offering, to purchase up to an additional 270,000 Common Shares at a price per Common Share equal to the Offering Price. In the event that the over-allotment option is exercised in full, the gross proceeds of the Offering will be approximately $38.2 million.

The Company expects to use the net proceeds from the Offering to repay indebtedness under the Company’s credit facility and repay in full the Company’s subordinated loan agreement with Pollard Equities Limited which was entered into in connection with the Company’s acquisition of INNOVA Gaming Group Inc.

The Common Shares will be offered by way of a short form prospectus to be filed with the securities commissions and other similar regulatory authorities in each of the provinces and territories of Canada pursuant to National Instrument 44-101 Short Form Prospectus Distributions, and in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended.

The closing of the Offering is scheduled to occur on or about February 21, 2018, and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the Toronto Stock Exchange and the securities regulatory authorities, and the satisfaction of other customary closing conditions.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy the Common Shares in the United States nor shall there be any sale of the Common Shares in any jurisdiction in which such offer, solicitation or sale would be unlawful. The Common Shares offered under the Offering have not been, and will not be, registered under the United States Securities Act of 1933, as amended, or the securities laws of any state of the United States. Accordingly, the Common Shares offered under the Offering may not be offered or sold in the United States or to U.S. persons unless an exemption from registration is available.

About Pollard Banknote

Pollard Banknote is a leading lottery partner to more than 60 lotteries worldwide. We provide high quality instant ticket print products, licensed games, and a full suite of digital offerings ranging from game apps to comprehensive player engagement and iLottery solutions, including related strategic marketing and management services. The company is a proven innovator and has decades of experience helping lotteries to maximize player engagement, sales, and proceeds for good causes. Pollard Banknote also plays a major role in providing pull-tab tickets, bingo paper and its Diamond Game-branded electronic ticket machines to charitable and other gaming markets in North America. Established in 1907, Pollard Banknote is owned approximately 73.5% by the Pollard family and 26.5% by public shareholders and is publicly traded on the TSX (PBL). For more information, please visit our website at www.pollardbanknote.com.

Forward-looking Statements

Certain statements in this press release may constitute “forward-looking” statements and information, which involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. When used in this document, such statements include such words as “may,” “will,” “expect,” “believe,” “plan,” and other similar terminology. These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this document. There should not be an expectation that such information will in all circumstances be updated, supplemented, or revised whether as a result of new information, changing circumstances, future events, or otherwise.

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FOR MORE INFORMATION CONTACT:

Doug Pollard
Co-Chief Executive Officer
E-mail: dpollard@pbl.ca

John Pollard
Co-Chief Executive Officer
E-mail: jpollard@pbl.ca

Rob Rose
Chief Financial Officer
E-mail: rrose@pbl.ca

Pollard Banknote Limited
Telephone: (204) 474-2323