/NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRE
SERVICES/
VANCOUVER, BC, March 17,
2023 /CNW/ - CubicFarm® Systems Corp.
("CubicFarms" or the "Company") (TSX: CUB), a leading local
chain agricultural technology company, today announced that it has
closed its previously announced overnight marketed public offering
(the "Offering") of units (the "Units") of the
Company.
Canaccord Genuity Corp. and Raymond James Ltd. acted as joint
bookrunners and co-lead agents (collectively, the "Co-Lead
Agents") for the Offering.
Each Unit consists of one common share of the Company (a
"Common Share") and one common share purchase warrant (the
"Warrant"). Each Warrant entitles the holder thereof to
acquire one Common Share of the Company at an exercise price of
C$0.10 (the "Exercise Price")
per Common Share for a period of 36 months from March 17, 2023 (the "Closing Date").
Pursuant to the Offering, the Company issued a total of
56,027,000 Units at a price of C$0.05
per Unit (the "Offering Price") for gross proceeds of
C$2,801,350, including 10,261,000
Units issued to reduce working capital obligations of the Company
for C$513,050 in payables
("Debt-for-Equity Swap").
As partial compensation for services rendered in connection with
the Offering, the Company has agreed to pay the Co-Lead Agents a
cash commission equal up to 6% of the aggregate gross proceeds of
the Offering, including the amounts raised in the Debt-for-Equity
Swap. As additional compensation, the Company issued to the Co-Lead
Agents 3,061,620 non-transferable compensation warrants (the
"Compensation Warrants"). Each Compensation Warrant will be
exercisable to acquire one Common Share of the Company at the
Offering Price for a period of 36 months from the Closing Date,
subject to adjustment in certain events.
The net proceeds from the Offering will be used for settlement
of debt, working capital obligations, and general corporate
purposes, including the full settlement of the amount owed to the
Company's auditor, KPMG LLP, pursuant to which settlement the
Company's auditors will immediately resume their audit activities
in connection with the year ended December
31, 2022 (see news release of the Company dated March 13, 2023).
The Common Shares have been conditionally approved for listing
on the TSX.
The Offering was conducted pursuant to an amended and restated
prospectus supplement, dated March 13,
2023, amending and restating the prospectus supplement dated
February 21, 2023 (the "Prospectus
Supplement"), to the short form base shelf prospectus dated
January 30, 2023 (the "Base
Shelf"). The Prospectus Supplement was filed with the
securities commissions and other similar regulatory authorities in
each of the provinces of Canada,
except the Province of Quebec on
March 13, 2023, the Company and the
Co-Lead Agents entered into an agency agreement on February 21, 2023. Copies of the Prospectus
Supplement and accompanying Base Shelf are available under the
Company's profile on SEDAR at www.sedar.com.
Jerry Li, President of CubicFarm
Systems (Shanghai) Corp., a wholly
owned subsidiary of the Company, subscribed for 5,000,000 Units for
total consideration of C$250,000.00,
representing a total of 10,000,000 Common Shares issuable to Mr.
Li, which is approximately 4.8% of the currently issued and
outstanding Shares of the Company.
The participation of Mr. Li constitutes a "related party
transaction" within the meaning of Multilateral Instrument 61-101 –
Protection of Minority Security Holders in Special Transactions
("MI 61-101") and the policies of the Toronto Stock Exchange
(the "TSX"). This transaction is exempt from the formal
valuation and minority shareholder approval requirements of MI
61-101 pursuant to sections 5.5(a) and 5.7(1)(a) of MI 61-101 as
neither the fair market value of any securities issued nor the
consideration paid by such person exceeds 25% of the Company's
market capitalization.
The Company will not file a material change report related to
Mr. Li's participation in the Offering more than 21 days before the
expected closing of the Offering as required by MI 61-101 as the
Company requires the consideration it will receive in connection
with the Offering immediately for working capital purposes.
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 the
securities in the United States or
in any other jurisdiction in which such offer, solicitation, or
sale would be unlawful. The securities have not been registered
under the United States Securities Act of 1933, as amended, and may
not be offered or sold in the United
States absent registration or an applicable exemption from
the registration requirements thereunder.
About HydroGreen
HydroGreen produces Automated Vertical Pastures™, a
type of smart farming equipment that uses a unique process to
sprout grains such as wheat and barley, in a controlled growing
environment to efficiently produce a high-performance feed
ingredient for livestock 365 days a year. HydroGreen's equipment is
simple and easy to operate and performs all growing functions
automatically, including seeding, watering, lighting, harvesting,
and re-seeding, which allows livestock businesses to feed
consistent nutrition every day with minimal labour. When balanced
correctly in the ration, HydroGreen sprouted grain modifies animal
digestion which enhances productivity and reduces the amount of
enteric methane emitted in ruminant livestock. The result also
enables environmental benefits to the farm while helping to meet
increasing demand for valuable farm-based inset and offset carbon
credits.
About CubicFarms
CubicFarms is a leading local chain agricultural technology
company developing and deploying technology to feed a changing
world. Its proprietary ag-tech solutions enable growers to produce
high quality, predictable produce and fresh livestock feed with
HydroGreen Nutrition Technology, a division of CubicFarm Systems
Corp. The CubicFarms™ system contains patented
technology for growing leafy greens and other crops onsite,
indoors, all year round. CubicFarms provides an efficient,
localized food supply solution that benefits our people, planet,
and economy.
For more information, please visit www.cubicfarms.com.
Forward looking and other cautionary statements
Certain statements in this release constitute
"forward-looking statements" or "forward-looking information"
within the meaning of applicable securities laws, including,
without limitation, statements with respect to: the Offering and
the use of proceeds from the Offering, amongst others. Such
statements involve known and unknown risks, uncertainties, and
other factors which may cause the actual results, performance, or
achievements of CubicFarm Systems Corp., or industry results, to be
materially different from any future results, performance, or
achievements expressed or implied by such forward-looking
statements or information including the Company obtaining the
approval of the Offering from the TSX and the other factors
disclosed under "Risk Factors" in the Company's annual information
form for the year ended December 31,
2021, and those risks described in other documents
incorporated or deemed to be incorporated by reference in the
prospectus. Such statements can be identified by the use of words
such as "intend", "expect", "believe", "plan", "anticipate",
"estimate", "scheduled", "forecast", "predict", and other similar
terminology, or state that certain actions, events, or results
"may", "can", "could", "would", "might", or "will" be taken, occur,
or be achieved.
These statements reflect the Company's current expectations
regarding future events, performance, and results and speak only as
of the date of this news release. Consequently, there can be no
assurances that such statements will prove to be accurate and
actual results and future events could differ materially from those
anticipated in such statements. Except as required by securities
disclosure laws and regulations applicable to the Company, the
Company undertakes no obligation to update these forward-looking
statements if the Company's expectations regarding future events,
performance, or results change.
SOURCE CubicFarm Systems Corp.