CubicFarm Systems Corp. (TSX: CUB), also known as CubicFarms, has announced the lease of FreshHub machinery and equipment to Langley Indoor Produce. The FreshHub Transaction, approved by CubicFarms’ Special Committee and Board of Directors, will allow the company to retain up to 97.6% of the equity interest of Langley Indoor Produce at the point of closing.
As part of the FreshHub Transaction, CubicFarms will also grant a license for the underlying FreshHub intellectual property to Langley Indoor Produce. The use of this license will be limited to the indoor, non-containerized implementation of CubicFarms’ patented equipment. Ongoing funding for Langley Indoor Produce will come from third-party investors.
CubicFarms’ rationale for pursuing this transaction is to allow for the continuation of research and development on the indoor FreshHub system while retaining focus on the HydroGreen business without diverting cash for research and development activities. This way, the company can prioritize and maximize the value of the HydroGreen business, protect shareholder interests, and ensure the FreshHub prototype project is able to deliver on its potential for at-scale success using third-party capital.
Following the CubicFarms Leasing FreshHub Transaction, Langley Indoor Produce will raise up to $1,000,000 through an ongoing private placement of convertible preferred shares. These proceeds will be used to fund the completion of the FreshHub Validation Project, cover other operating costs of Langley Indoor Produce, and construct FreshHub units, either at separate or existing FreshHub facilities. To the extent Langley Indoor Produce raises the full $1,000,000 financing, CubicFarms will have the option to retain approximately 85% of the equity interest of Langley Indoor Produce.
CubicFarms, a leading indoor farming technology company, is dedicated to providing sustainable and efficient solutions for the agriculture industry. The company’s patented equipment, including the HydroGreen and FreshHub systems, are designed to increase crop yields while reducing water and energy consumption. With the FreshHub Transaction, CubicFarms is able to continue its research and development on the FreshHub system while focusing on the growth and success of the HydroGreen business.
Image provided by CubicFarm Systems Corp
You must log in to post a comment.