CellCube Provides Corporate Update

TORONTO, Nov. 12, 2019 - CellCube Energy Storage Systems Inc. (“CellCube” or the “Company”) (CSE:CUBE), wishes to announce that it has signed a term sheet setting out the main terms and conditions on, and subject to which, a consortium of investors led by Bushveld Energy, a wholly owned subsidiary of Bushveld Minerals, (the “Bushveld Consortium”) would be willing, in principle, to acquire the entire issued share capital of Enerox GmbH (“Enerox”) from CellCube Energy Storage Systems Inc. (the “Seller”).

Highlights

• The Bushveld Consortium has been granted exclusivity until the end of February 2020 to complete due diligence and negotiate definitive acquisition documents. The transaction will, if completed, see the Bushveld Consortium acquire the entire issued share capital of Enerox GmbH (“Enerox”) from the Seller for a total sum of €11,000,000, and a working capital financing for Enerox of €1.5 million. The transaction is structured in three parts:
  • Pursuant to the signing of the Term Sheet, The Bushveld Consortium will pay the Seller €300,000, which the Seller will in-turn contribute to Enerox as a surplus capital contribution for Enerox to fund its short terms working capital requirements.
  • An initial sale and purchase agreement (the “Initial SPA”), to be signed as soon as reasonably practicable after the signing of the term sheet, whereby the Bushveld Consortium would purchase 24.90 per cent of the share capital of Enerox (the “Initial Shares”) for a sum of €150,000, and contribute an additional sum of €1.2 million, in surplus capital contributions for working capital purposes to be paid as follows:
    • €300,000 immediately upon becoming a shareholder in Enerox;
    • €300,000 by 1 December 2019;
    • €300,000 by 1 January 2020; and
    • €300,000 by 1 February 2020.
  • A subsequent sale and purchase agreement (the “Main SPA”), subject to a technical, legal and financial due diligence, which will provide for the purchase of the remaining 75.1 per cent of the shares of Enerox for a further consideration of €10.85 million, comprising:
    • €8.35 million payable upon completion of the Transaction. Up to €2.0 million of this consideration can be paid, at Bushveld’s discretion, in Bushveld Minerals shares (priced at the lesser of the 10-day volume-weighted-average-price prior to, or the price on, the 4^th day before closing). It is intended that the Main SPA and other principal transaction documents will be signed on or before 31 December 2019, with completion to occur as soon as practical thereafter.
    • An additional deferred consideration of €2.5 million payable by the Bushveld Consortium to the Seller over 30 months comprising €500,000 payable every six months starting in June 2020 (the "Deferred Consideration").

• The Seller will ensure that Enerox is debt free at transaction closure.
• Should the Seller or Bushveld Consortium elect not to enter into the Main SPA, the Seller has a call option to purchase the Initial Shares at a price equal to €1.65 million paid by the Bushveld Consortium to the Seller and Enerox, plus an amount equivalent to 12 per cent of such amount. In the event the call option is not exercised by the Seller, the Bushveld Consortium has an option to put the Initial Shares to the Seller for the same amount. Should the Seller not honor the put, the Bushveld Consortium would have the option of increasing its holding in Enerox by 50 per cent plus one share for an additional amount of €250,000. In circumstances where the Main SPA is not entered into because the Bushveld Consortium withdraws from the transaction, it would continue to provide the working capital payments to Enerox.

Brett Whalen, Interim CEO and Chairman of CellCube, commented:

• “The current financial state of CellCube, as reported in the Company’s Corporate Update issued on October 22, 2019, has precipitated the need to monetize Enerox. Enerox has funded its ongoing operation, over the past year, through the use of credit facilities. To maximize the value attributable to CellCube, we believed now was the right time to enter into a transaction for the sale of Enerox and believe the Bushveld Consortium will see Enerox through to its full potential.”

About CellCube Energy Storage Systems Inc.
CellCube is a Canadian public company listed on the Canadian Securities Exchange (symbol CUBE), the OTCBB (symbol CECBF), and the Frankfurt Exchange (Symbol 01X, WKN A2JMGP) focused on the fast-growing energy storage industry which is driven by the large increase in demand for renewable energy.

This news release contains certain "forward-looking statements" within the meaning of Canadian securities legislation. Forward-looking statements are statements that are not historical facts which address events, results, outcomes or developments that the Company expects to occur; they are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "aims", "potential", "goal", "objective", "prospective", and similar expressions, or that events or conditions "will", "would", "may", "can", "could" or "should" occur. Forward-looking statements are based on the beliefs, estimates and opinions of the Company's management on the date the statements are made and they involve a number of risks and uncertainties. Certain material assumptions regarding such forward-looking statements are discussed in this news release and the Company's annual and quarterly management's discussion and analysis filed at www.sedar.com. Except as required by the securities disclosure laws and regulations applicable to the Company, the Company undertakes no obligation to update these forward-looking statements if management's beliefs, estimates or opinions, or other factors, should change. Neither the CSE nor its Regulation Services Provider (as that term is defined in the policies of the CSE) accepts responsibility for the adequacy or accuracy of this release.

For further information please contact: CellCube Energy Storage Systems Inc. Brett Whalen, Interim CEO and Chairman Email: info@cellcubeenergystorage.com www.cellcubeenergystorage.com