Red Deer, Alberta–(Newsfile Corp. – June 2, 2021) – CanadaBis Capital Inc. (TSXV: CANB) (“CanadaBis” or the “Company“) is pleased to announce that it has filed with, and obtained a receipt for, a preliminary short form prospectus dated June 1, 2021 (the “Prospectus“) with respect to a marketed offering (the “Offering“) of units (the “Units“) of the Company for gross proceeds to the Company of up to $5,000,000 at a price to be determined in the context of the market. Each Unit will consist of one common share of the Company (a “Common Share“) and one Common Share purchase warrant (a “Warrant“), with each Warrant being exercisable to acquire one Common Share.

The Offering will be conducted on a commercially reasonable efforts basis and will be led by Leede Jones Gable Inc. (“LJG” or the “Agent“).

The size and price 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 Agent. On closing of the Offering, the Company has agreed to pay the Agent a cash fee equal to 7.0% of the gross proceeds of the Offering. As additional compensation, the Agent will be issued broker warrants (the “Broker Warrants“) as is equal to 7.0% of the aggregate number of Units issued pursuant to the Offering, with each Broker Warrant being exercisable to acquire one Common Share.

The Company has granted the Agent an option (the “Over-Allotment Option“), exercisable in part or in whole at the Agent’s sole discretion, at any time beginning on the closing of the Offering until 30 days following the closing of the Offering, to purchase up to that number of additional Units as is equal to 15% of the aggregate number of Units sold in the Offering for market stabilization purposes and to cover over-allotments, if any.

The Prospectus has been filed in each of the provinces of Canada other than Quebec pursuant to National Instrument 44-101 – Short Form Prospectus Distributions.

The closing of the Offering is expected to occur during the week of June 21, 2021 (the “Offering Closing“) and is subject to customary market conditions and the Company receiving all necessary regulatory approvals, including the approval of the TSX Venture Exchange for the listing of the Common Shares and the Warrants comprising the Units. There can be no assurance as to whether or when the Offering may be completed, or as to the actual size or terms of the Offering.

The securities referred to in this news release have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from the U.S. registration requirements. This press release does not constitute an offer for sale of securities, nor a solicitation for offers to buy any securities in the United States, nor in any other jurisdiction in which such offer, solicitation or sale would be unlawful. Any public offering of securities in the United States must be made by means of a prospectus containing detailed information about the company and management, as well as financial statements.

CONCURRENT PRIVATE PLACEMENT AND SHARE SWAP

In addition to the Offering, pursuant to a subscription agreement (the “Subscription Agreement“) dated June 1, 2021, Plant-Based Investment Corp. (the “Investor” or “PBIC“) has agreed to purchase, on a prospectus-exempt basis, such number of Units (the “Placement Units“) at the same price as the Units for aggregate gross proceeds of $1,000,000 (the “Concurrent Private Placement“). Each Placement Unit shall be comprised of one Common Share and one Warrant. Additionally, the Company will enter into a share swap agreement with the Investor to exchange $1,000,000 of each others’ common shares (the “Share Swap“). Closing of the Concurrent Private Placement and Share Swap are scheduled to occur concurrently with the Offering Closing and closing of the Concurrent Private Placement is conditional upon Offering Closing, the execution of a share swap agreement in respect of the Share Swap, the execution of voting and resale agreements in respect of the voluntary lock-up periods described herein, the execution of the Observer Rights Agreement (as defined below) and the execution of a cannabis supply agreement pursuant to which the Investor will supply the Company with various cannabis products for distribution. The Common Shares and Warrants comprising the Placement Units as well as any Common Shares issued pursuant to the Share Swap will be subject to a statutory four month hold period, as well as a voluntary lock-up period until December 31, 2022. The Company has also agreed to a voluntary lock-up period in respect of the common shares of the Investor it will receive pursuant to the Share Swap. Finally, the Company has agreed to grant the Investor the right, pursuant to an agreement (the “Observer Rights Agreement“), to appoint a board observer who shall have the right to receive notice and attend all meetings of our board of directors but shall not have any voting rights. The closing of the Concurrent Private Placement and Share Swap is subject to TSXV approval and the approval of the Canadian Securities Exchange with respect to the issuance by the Investor of its common shares pursuant to the Share Swap. The Agent acted as selling agent in the Concurrent Private Placement and will be paid fees on the gross proceeds of the issuance of the Placement Units consistent with the cash fees and Broker Warrants being paid and issued to the Agent in connection with the Offering. No fees will be paid in connection with the Share Swap.

PBIC has structured some of its previous transactions using a share swap structure, which is a structure that has been successful for PBIC in the past, allowing it to align itself with strategic partners in the cannabis industry. PBIC views the Company as a strategic partner in the cannabis 3.0 industry, with best-in-class technology and processing capability for butane hash oil (BHO) processing.

The Company intends to use the net proceeds from the Offering and the Concurrent Private Placement for further outdoor cultivation development, the purchase of additional equipment and for general working capital purposes with a view to expand the Company’s extraction and tolling business. Any additional proceeds received from the exercise of the Over-Allotment Option and exercise of any Warrants will be used for general working capital and administrative purposes.

REFINANCING OF MORTGAGE FACILITIES

The Company is also pleased to announce it has signed a binding commitment letter with Connect First Credit Union for a new credit facility (the “New Credit Facility“) to be comprised of a 5-year term, $8,850,000 commercial mortgage loan bearing interest at a fixed rate of 4.35% per annum (calculated daily and payable monthly in arrears) and a $750,000 demand line of credit bearing interest at a rate of the lender’s prime lending rate plus 1.00% per annum (calculated daily and payable monthly in arrears). The New Credit Facility will be used to refinance all current mortgages and for working capital purposes. The New Credit Facility will be subject to certain customary financial covenants. Funding of the New Credit Facility shall be made in two tranches, the first tranche ($7,210,000) is subject to customary closing conditions, including registration of all security required in connection with the New Credit Facility. The second tranche ($1,640,000) shall be advanced upon completion and delivery of the Company’s July 31, 2021 year-end audited financial statements, provided that all financial covenants and benchmarks have been met or exceeded. It is anticipated that the first tranche of the New Credit Facility will be funded on or about June 11, 2021. A copy of the New Credit Facility will be available under the Company’s profile at www.sedar.com.

ABOUT CANADABIS CAPITAL INC.

CanadaBis Capital Inc. (TSXV: CANB) is a vertically integrated Canadian cannabis company focused on achieving large-scale growth in the global cannabis market – with specific attention paid to supplying the fast-emerging concentrates category through their Stigma Grow cultivation and extraction facility.

Acting as the cornerstone for everything it offers, Stigma Grow continuously strives to address the market demands and lingering stigmas within the legal cannabis industry head-on, with products designed to disturb the status quo and dramatically shift the conversation surrounding Canada’s legal cannabis industry.

For more information on CanadaBis Capital or Stigma Grow visit:
www.canadabis.com
www.stigmagrow.ca

or contact:
investor relations [email protected] 1-888-stigma1

FORWARD-LOOKING INFORMATION

This news release contains forward-looking statements and forward-looking information (collectively, “forward-looking information“) within the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “objective”, “ongoing”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends” and similar expressions are intended to identify forward-looking information and include, without limitation, statements regarding the timing and completion of the Offering, Concurrent Private Placement and Share Swap; the listing of the Common Shares and the Warrants comprising the Units on the TSXV; the size of the Offering, Concurrent Private Placement and Share Swap; the use of proceeds of the Offering and Concurrent Private Placement; the expected timing for the receipt of all requisite regulatory approvals; the terms and conditions of the New Credit Facility and the timing of funding thereunder; and the ability to raise the funds to finance its ongoing business activities and the results thereof. The forward-looking information is based on certain key expectations and assumptions made by the Company. Although the Company believes that the expectations and assumptions on which such forward-looking information are based are reasonable, undue reliance should not be placed on the forward-looking d information because the Company can give no assurance that they will prove to be correct. Since forward-looking information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. Factors which could materially affect such forward-looking information may include, but are not limited to, the ability to successfully market and complete the Offering; the ability to complete the Concurrent Private Placement and Share Swap, including the satisfaction of all conditions precedent related thereto; the ability to obtain all requisite regulatory approvals including the approval of the TSX Venture Exchange and the Canadian Securities Exchange and those of the securities regulatory authorities in respect of a (final) short form prospectus, the Concurrent Private Placement and Share Swap; the ability to apply the proceeds as intended; the ability to receive funding under the New Credit Facility on the time frame expected or at all; the ability of the Company to complete transactions on terms announced; timing and availability of external financing on acceptable terms and such other factors as are described in the risk factors in the Company’s most recent annual management’s discussion and analysis that is available on the Company’s profile on SEDAR at www.sedar.com.

Readers are cautioned that the foregoing list of factors is not exhaustive. The forward-looking information included in this news release are expressly qualified by this cautionary statement. The forward-looking information contained in this news release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

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