CUB CubicFarm Systems Corp

CubicFarm® Systems Corp. (“CubicFarms” or the “Company”) (TSX:CUB), a leading local chain agricultural technology company, today announced it has commenced an overnight marketed public offering (the “Offering”) of unsecured convertible debenture units (the “Debenture Units”) and common shares (the “Common Shares”) of the Company.

The Offering will be conducted on a best efforts agency basis pursuant to the terms and conditions of an agency agreement to be entered into between the Company, Raymond James Ltd. and Canaccord Genuity Corp. as joint bookrunners on behalf of a syndicate of agents (collectively, the “Agents”). The defining pricing, terms and size of the Offering will be determined in the context of the market at the time of entering into a definitive agency agreement between the Company and the Agents.

Each Debenture Unit will consist of: (i) a principal amount 8% convertible unsecured debenture (the "Convertible Debentures") convertible into common shares of the Company at a conversion price per common share to be determined (the “ Conversion Price”) and maturing five years from the closing of the Offering (the "Maturity Date"); and (ii) a number of common share purchase warrants to be determined (the “Warrants”), with each Warrant entitling the holder thereof to acquire one common share of the Company at an exercise price per share to be determined (the “Exercise Price”) for a period of three years from the closing of the Offering. The terms of the Offering set out herein are indicative terms only and the definitive size of the Offering, issue price per Debenture Unit, face value of the Convertible Debentures, the Conversion Price, the number of Warrants per Debenture Unit, and the Exercise Price will be determined in the context of the market.

The Company will also grant the Agents an option (the “Over-Allotment Option”) to sell up to an additional 15% of the Debenture Units and Common Shares sold under the Offering, at the price sold pursuant to the Offering. The Over-Allotment Option may be exercised at any time up to 30 days following the closing date of the Offering.

The Offering will be conducted (i) pursuant to a prospectus supplement (the “Prospectus Supplement”) to the Company’s amended and restated short form base shelf prospectus dated October 13, 2021 (the “Base Shelf Prospectus”), which Prospectus Supplement is expected to be filed with the securities commissions and other similar regulatory authorities in each of the provinces of Canada, except the Province of Québec, and (ii) in jurisdictions outside of Canada as are agreed by the Company and the Agents. It is expected that the Company and the Agents will enter into a definitive agency agreement and file the Prospectus Supplement following the pricing of the Offering. Copies of the Prospectus Supplement and accompanying Base Shelf Prospectus will be available under the Company’s profile on SEDAR at www.sedar.com.

The net proceeds from the Offering will used for continued organic growth, technology development, working capital, and general corporate purposes.

The Offering is expected to close on or about June 2, 2022, subject to customary closing conditions.

Closing of the Offering is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the Toronto Stock Exchange (the “TSX”) to list the common shares of the Company underlying the Convertible Debentures and the Warrants. The Company will also use commercial reasonable efforts to obtain the necessary approvals to list the Convertible Debentures, the Warrants, and the Common Shares on the TSX.

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 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.

On behalf of the Board of Directors

“Dave Dinesen”

Dave Dinesen, Chief Executive Officer

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; the use of proceeds from the Offering; the jurisdictions in which the Offering will be conducted; the filing of a Prospectus Supplement; closing of the Offering; the listing of the Convertible Debentures and the Warrants; and the Company’s products. 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 Toronto Stock Exchange 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.

Media Contact: Andrea Magee T: 236.885.7608 E: andrea.magee@cubicfarms.com

Investor Contact: Tom Liston T: 416.721.9531 E: tom.liston@cubicfarms.com