Mr. David Mier reports

SPECTRA7 MICROSYSTEMS INC. ANNOUNCES CONCURRENT PRIVATE PLACEMENT

In addition to the $4-million bought deal public offering of units previously announced by the company on June 1, 2017, Spectra7 Microsystems Inc. intends to sell, on a brokered private placement basis, up to 10 million units at a price of 40 cents per unit for gross proceeds of up to $4-million. The company has engaged Lake Street Capital Markets LLC and Chardan to lead the concurrent private placement outside of Canada.

As with the public offering, each unit issued pursuant to the concurrent private placement shall consist of one common share of the company and one-half of one common share purchase warrant. Each warrant will entitle the holder to acquire one common share at an exercise price of 55 cents per common share for a period of two years following the closing of the concurrent private placement. The expiry date of the warrants may be accelerated by the company at any time if the volume-weighted average trading price of the common shares on the facilities of the Toronto Stock Exchange (or such other exchange on which the common shares trade) is greater than 85 cents for any 10 consecutive trading days following the date that is four months and one day after the issuance of the warrants.

The net proceeds from the concurrent private placement will be used for research and development and for working capital and general corporate purposes.

The concurrent private placement is scheduled to close concurrently with the public offering on or about the week of June 19, 2017, 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.

The company expects that insiders of the company will participate in connection with the concurrent private placement. Pursuant to Multilateral Instrument 61-101 (protection of minority securityholders in special transactions), the concurrent private placement constitutes a related-party transaction as insiders of the company will subscribe for units. The company is relying on exemptions from the formal valuation and minority approval requirements of MI 61-101. The concurrent private placement was approved by all of the independent directors of the company.

The company also intends to issue, on a private placement basis, 625,000 units in connection with a financial advisory services arrangement between the company and the lead underwriter of the public offering, Canaccord Genuity Corp. The advisory units and all securities issued pursuant to the concurrent private placement are subject to a statutory hold period of four months and one day pursuant to applicable securities legislation.

About Spectra7 Microsystems Inc.

Spectra7 Microsystems is a high performance analog semiconductor company delivering unprecedented bandwidth, speed and resolution to enable disruptive industrial design for leading electronics manufacturers in broadband connectivity markets. Spectra7 is based in San Jose, Calif., with design centres in Markham, Ont., Cork, Ireland, and Little Rock, Ark.

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