S-1 1 s002439x4_s1.htm S-1

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As filed with the Securities and Exchange Commission on November 16, 2018.

Registration No. 333-         

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

CIBUS LTD.
(Exact name of registrant as specified in its charter)

Bermuda
2836
 
(State or other jurisdiction of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification Number)

Clarendon House
2 Church Street
Hamilton HM 11, Bermuda
(441) 295-1422
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Jim Hinrichs
Chief Financial Officer
Cibus Ltd.
6455 Nancy Ridge Drive
San Diego, California 92121
(858) 450-0008
(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Kenneth Polin
Boris Dolgonos
Peter E. Devlin
Jones Day
250 Vesey Street
New York, New York 10281
(212) 326-3939
Alan Dickson
Conyers Dill & Pearman Limited
Clarendon House
2 Church Street
Hamilton HM 11, Bermuda
(441) 295-1422
Richard D. Truesdell, Jr.
Derek Dostal
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, New York 10017
(212) 450-4000

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box:o

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.o

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.o

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer
o
Accelerated filer
o
Non-accelerated filer
Smaller reporting company
 
 
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

CALCULATION OF REGISTRATION FEE

Title of Each Class of
Securities to be Registered
Proposed
Maximum Aggregate
Offering Price(1)(2)
Amount of
Registration Fee
Class A common shares, par value $0.00001 per share
$
100,000,000
 
$
12,120
 

(1)Includes the offering price of Class A common shares that may be sold if the option to purchase additional Class A common shares granted to the underwriters is exercised.
(2)Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457(o) under the Securities Act of 1933.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

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The information in this preliminary prospectus is not complete and may be changed. We may not offer these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED NOVEMBER 16, 2018

PRELIMINARY PROSPECTUS

                Shares

Class A Common Shares

This is our initial public offering. We are offering           of our Class A common shares.

Prior to this offering, there has been no public market for our Class A common shares. We have applied to list the Class A common shares on the Nasdaq Global Market under the symbol “CBUS.” We anticipate that the initial public offering price will be between $          and $          per Class A common share.

We are an “emerging growth company” as that term is defined in the Jumpstart Our Business Startups (JOBS) Act of 2012 and a “smaller reporting company” as that term is defined in Regulation S-K under the Securities Act of 1933, as amended, and as such, will be subject to certain reduced public company reporting requirements. See “Summary—Implications of Being an Emerging Growth Company.”

Investing in our Class A common shares involves a high degree of risk. See “Risk Factors” beginning on page 18.

 
Per Share
Total
Public offering price
$
       
 
$
       
 
Underwriting discounts(1)
$
 
 
$
 
 
Proceeds to us before expenses(1)
$
 
 
$
 
 
(1)The underwriters have agreed to reimburse certain of our expenses. See “Underwriting.”

The underwriters have the option to purchase up to           additional Class A common shares from us at the initial public offering price less the underwriting discount.

The underwriters expect to deliver the Class A common shares to purchasers on or about          , 2018 through the book-entry facilities of The Depository Trust Company.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

Morgan Stanley
BofA Merrill Lynch
Piper Jaffray

The date of this prospectus is            , 2018

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We and the underwriters have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses prepared by or on behalf of us or to which we have referred you. We and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may provide you. We are offering to sell, and seeking offers to buy, Class A common shares only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Class A common shares.

For investors outside the United States: Neither we nor any of the underwriters have taken any action that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. You are required to inform yourself about, and to observe any restrictions relating to, this offering and the distribution of this prospectus.

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As used in this prospectus, unless otherwise noted or the context requires otherwise:

“We,” “us,” “our,” the “Company,” “Cibus” and similar references refer: (i) following the consummation of the Reorganization Transactions, including this offering, to Cibus Ltd., a Bermuda exempted company limited by shares, and, unless otherwise stated, all of its subsidiaries, including Cibus Global, Ltd., a British Virgin Islands business company, which we refer to as “Cibus Global,” and, unless otherwise stated, all of its subsidiaries, and (ii) on or prior to the completion of the Reorganization Transactions, including this offering, to Cibus Global, and, unless otherwise stated, all of its subsidiaries;
“Product candidates” means (i) with respect to canola crops in North America, additional canola traits incorporated from time to time in our proprietary branded canola seed products and (ii) our traits that we intend to license globally to third-party seed companies, as described under “Business—Commercial Approach and Product Portfolio;”
“Continuing Cibus Global Equity Owners” refers to those Original Cibus Global Equity Owners that will continue to own Equity Interests of Cibus Global after the Reorganization Transactions and who may, following the consummation of this offering, exchange their Equity Interests for our Class A common shares;
“Former Cibus Global Equity Owners” refers to those Original Cibus Global Equity Owners who will transfer their Non-Voting Equity Interests of Cibus Global and warrants (if applicable) to purchase Non-Voting Equity Interests for our Class A common shares in connection with the consummation of this offering;
“Original Cibus Global Equity Owners” refers to the owners of non-voting common shares, convertible preferred shares and restricted shares of Cibus Global prior to the Reorganization Transactions (but does not include the Blockers);
“Non-Voting Equity Interests” refers to a class of non-voting common shares of Cibus Global that will be in issue following the completion of the Reorganization Transactions;
“Voting Equity Interests” refers to a class of voting common shares of Cibus Global that will be in issue following the completion of the Reorganization Transactions;
“Equity Interests” refers to the Voting Equity Interests and the Non-Voting Equity Interests that will be in issue following the completion of the Reorganization Transactions; and
“Reorganization Transactions” refers to the transactions undertaken in connection with our internal reorganization, as described under “Our Structure and Reorganization—The Reorganization Transactions.”

We will be a holding company and the sole director of Cibus Global, and upon completion of this offering and the application of proceeds therefrom, our principal asset will be Equity Interests of Cibus Global. Cibus Global is the predecessor of the issuer, Cibus Ltd., for financial reporting purposes. Cibus Ltd. will be the audited financial reporting entity following this offering.

We have made rounding adjustments to some of the figures included in this prospectus. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that precede them.

Currency amounts in this prospectus are stated in U.S. dollars, unless otherwise indicated.

This prospectus includes industry and market data that we obtained from industry publications, third-party studies and surveys, filings of public companies in our industry, and related industries and internal company surveys. These sources include government and industry sources, which generally state that the information contained therein has been obtained from sources believed to be reliable. Although we believe the industry and

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market data to be reliable as of the date of this prospectus, this information could prove to be inaccurate. Industry and market data could be wrong because of the method by which sources obtained their data and because information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties. We do not know all of the assumptions regarding general economic conditions or growth that were used in preparing the forecasts from the sources relied upon or cited herein. Assumptions and estimates of our and our industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in “Risk Factors.” These and other factors could cause future performance to differ materially from our assumptions and estimates. See “Special Note Regarding Forward-Looking Statements.”

Throughout this prospectus, we refer to the following technical terms:

“aflatoxin” is a known liver carcinogen produced by certain fungi when they grow on foods such as peanut, corn and sorghum.
“cell culture” refers to the process by which cells, tissues or organs are grown or maintained under controlled sterile conditions on a nutrient culture medium of known composition, generally outside of their natural environment.
“crop platform,” as used with respect to our business, refers to a fundamental understanding of the relevant crop and the development of a crop-specific predictable, reproducible process for isolating single plant cells, making the desired genetic edit(s) in those cells, and regenerating edited cells into whole plants possessing the desired traits.
“DNA,” or deoxyribonucleic acid, is a molecule that carries the genetic code comprising four chemical bases: adenine (A), guanine (G), cytosine (C) and thymine (T), the sequence of which determines the information available for building and maintaining an organism.
“elite” refers to a plant that expresses well-documented and consistent observable characteristics (phenotypes).
“genome” refers to the genetic material of an organism.
“genomics” refers to the study of the structure, function, evolution, mapping and editing of genomes.
“genotype” refers to the genetic constitution of an individual organism.
“germplasm” refers to living plant tissue from which new plants can be grown, which most commonly refers to seeds, but may also include other parts of a plant.
“glyphosate” is a specific broad-spectrum systemic herbicide that inhibits aromatic amino acid biosynthesis, eventually leading to the plant’s death.
“high-oleic oil” refers to oil that is high in oleic acid, which is a monounsaturated fatty acid, and low in linoleic acid, which is a polyunsaturated acid. Monounsaturated fats, such as oleic acid, can help reduce bad low-density lipoprotein (LDL) cholesterol, which can lower risk of cardiovascular disease. Polyunsaturated fats, such as linoleic acid, have poor stability against oxidation, whereas, monounsaturated fats are highly resistant to heat and show good stability under frying conditions.
“hybrid” refers to a plant that results from cross pollinating two different plant varieties and carries a combination of traits from the respective parent plants.
“mutagen” refers to an agent that causes genetic change (mutation) in a cell.
“mutagenesis” is a method of plant breeding involving the induction of mutations in plants by exposing whole plants, seeds or plant tissue to chemicals or radiation as a means of purposely damaging genetic material, thereby creating greater genetic variation.
“oligonucleotide-directed mutagenesis,” or “ODM,” refers to a gene-editing technique in which chemically-synthesized nucleic acid sequences, referred to as oligonucleotides, act as a mutagen and DNA template in conferring a desired mutation without undergoing recombination.

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“parent seed” refers to seed that possesses desired traits and can be the male and female germplasm used for breeding hybrids.
“sulfonylurea herbicides” are a specific broad-spectrum systemic herbicide employing sulfonylurea organic compounds inhibiting branched chain amino acid biosynthesis, eventually leading to the plant’s death.
“transgenic” refers to an organism into which foreign genetic material has been incorporated.
“transgenic process” refers to a process in which foreign genetic material is integrated, temporarily or permanently, into an organism’s genetic code as a byproduct or end result of such process.

“Cibus,” “RTDS,” “Falco,” “SU Canola,” “Nucelis,” “ASAP,” “Trait Machine,” the Cibus logo and other trademarks or service marks of Cibus appearing in this prospectus are the property of Cibus. Trade names, trademarks and service marks of other companies appearing in this prospectus are the property of their respective holders and do not imply a relationship with, or endorsement or sponsorship of us, by these other companies. Solely for convenience, trademarks and trade names in this prospectus may be referred to without the ™ and ® symbols, but such references, or their failure to appear, should not be construed as any indicator that their respective owners will not assert their rights with respect thereto.

In anticipation of future traits being launched in our branded canola seeds we relaunched our branded canola seeds in September 2018 under the brand name, Falco. Currently, sulfonylurea-tolerant canola seeds are the only product being sold under the Falco brand name, and as such, the SU Canola and Falco brand names are used interchangeably in this prospectus.

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SUMMARY

This summary highlights information included elsewhere in this prospectus and does not contain all of the information you should consider in making an investment decision. You should read this entire prospectus carefully, including the sections entitled “Risk Factors,” “Special Note Regarding Forward-Looking Statements,” “Selected Historical Financial Data,” “Unaudited Pro Forma Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and the notes thereto before making an investment decision regarding our Class A common shares.

Our Company

Business Overview

We are a biotechnology company using advanced technologies to develop desirable plant traits for the global seed industry. Founded in 2001, we have developed and are commercializing a proprietary and highly differentiated gene-editing technology, which we refer to as the Rapid Trait Development System (“RTDS”). RTDS enables us to efficiently introduce customizable, specific and predictable value-enhancing traits into plants and microorganisms. This ability to precisely edit plant genes without the integration of foreign genetic material, or recombinant DNA, establishes our technology as truly non-transgenic, both in process and product, and distinguishes us from competitors. Our gene-editing approach accelerates the processes that underlie natural breeding and provides a versatile and low-cost means to increase crop yields for farmers, to develop healthier food for consumers, and to reduce waste for a sustainable agricultural ecosystem. We have taken care to responsibly improve characteristics in plants as our trait products are indistinguishable from those that could occur in nature. We believe RTDS can transform the global seed industry by applying advanced trait development to a broader range of crops and geographies than has previously been targeted, enabling us to meet demands across the agricultural value chain—from farmers seeking weed control and disease tolerance options for greater crop yields, to processors looking to improve ease of handling and to minimize waste, to retail consumers increasingly demanding foods that are healthier, more nutritious and safer (e.g., non-allergenic).

Historically, large agricultural chemical companies have introduced desirable traits by employing transgenic processes, in which foreign genetic material is integrated into the plant’s genetic code. The integration of this recombinant DNA typically results in seeds being classified as genetically engineered, or bioengineered (“BE”), or genetically modified organisms (“GMO”), and therefore subject to strict regulation in many countries. With transgenic techniques, it can take more than a decade and cost up to an estimated $135 million to develop a single plant trait, assess it for safety and receive regulatory approval prior to commercialization. In contrast, RTDS can be used to develop a desirable plant trait, such as disease tolerance, and introduce it into multiple crops within months, enabling trait commercialization within five years and at a significantly lower cost than transgenic techniques. Our target market is the $39 billion global seed industry. As seeds with traits developed through RTDS are non-transgenic and not subject to heightened GMO regulation in certain of our key agricultural markets, we are able to develop traits that can compete across the seed market—in the $17 billion conventional seed market (non-GMO), and also in the $21 billion biotech seed market (comprising seeds with traits developed through biotechnology). We believe value in this sector can be captured by engineered seeds that improve yields, sustainability and consumer appeal. We believe our technology, commercial relationships and reputation within the global seed industry position us well to accelerate growth in the already fast-growing biotech seed market by providing competitive, non-transgenic options as well as to share in growth of the non-GMO conventional seed market through the non-transgenic introduction of desirable traits. For example, by developing disease-resistance traits that protect against key diseases while reducing the volume and frequency of fungicide applications, we believe we can capture additional value from the global market for fungicide, valued at over $15 billion, which is used to protect crops against fungal plant diseases.

Our commercial strategy has two pillars. First, in North America, we have launched our proprietary branded canola seed product in the $1.4 billion North American canola seed market. The launch of our first commercial product, SU Canola (canola tolerant to specific sulfonylurea herbicides), has enabled us to establish our brand, build market confidence in Cibus technology and demonstrate the power and commercial viability of our non-transgenic gene-editing process. In anticipation of future traits being launched in our branded canola seeds we relaunched our branded canola seeds in September 2018 under the brand name, Falco. Currently, sulfonylurea-tolerant canola seeds are the only product being sold under the Falco brand name. The high-value North American canola seed market has grown by 133% from $600 million (17 million acres) in 2008 to $1.4 billion (25 million acres) in 2017. Since we first launched SU Canola in the United States in the

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2016 growing season, it has attained approximately a 4% share (measured by acres planted) in the U.S. canola market. Following our limited pre-launch in the Canadian provinces of Manitoba and Saskatchewan this year, we intend to fully launch SU Canola more broadly in those provinces in the 2019 growing season. SU Canola’s non-transgenic nature is recognized in key target canola/oilseed rape markets, and neither the regulatory authorities in the United States nor Canada consider SU Canola to be a product of genetic engineering. In response to market demand for non-GMO products, we have established important industry partnerships to incentivize the cultivation of our SU Canola product. For example, large agribusiness companies, such as Cargill Inc. (“Cargill”) and Bunge Ltd. (“Bunge”), have established agreements to provide farmers non-GMO premiums when they deliver grain produced from our SU Canola seed to their crushing facilities. Building on our success with SU Canola, our canola product candidates for the North American market include additional herbicide tolerances, yield protection and disease tolerance traits. In the North American canola market, our goal is to produce and sell seeds that enable farmers to grow the highest yielding, most profitable canola crops. We expect to launch up to three next-generation canola hybrids in 2019 and each of our yield protection trait (pod shatter reduction) and our disease tolerance trait between 2020 and 2023.

The second pillar of our commercial strategy, outside of the North American canola seed market, is to develop and license our RTDS-developed crop traits to leading seed companies. We have developed desirable traits in crops that are positioned to be grown and sold in key target agricultural markets, such as the United States, Canada, Argentina, China and potentially other markets over time. Licensing traits gives us the greatest opportunity to penetrate these markets efficiently, while leveraging our licensing partners’ breeding and commercialization expertise. Having proven the capabilities of RTDS in canola, we expect to launch and license our first herbicide tolerant rice product between 2020 and 2023. We estimate the addressable rice market to be a $1.9 billion market opportunity. Further, as part of our initial focus we have established additional customizable “crop platforms” for trait development in flax, potato and cassava, and we are developing crop platforms for trait development in peanut, wheat and corn. We also intend to develop a crop platform in soybean with the potential to expand to all other major crops. Including our yield protection and disease tolerance canola traits and our herbicide tolerance rice traits, described above, we expect to launch six traits in three crops within the next five years, each of which we believe addresses a significant market opportunity. To date, the transgenic development of crop traits by large agricultural chemical companies has been mostly limited to herbicide tolerance and insect resistance traits in corn and soybean, and, to a lesser extent, cotton and canola. RTDS is able to address important trait needs, such as disease tolerance and pod shatter reduction, which have not historically been focused on by the large agricultural chemical companies. The non-transgenic development of these under-addressed traits in major crops is a key component of the licensing pillar of our commercial strategy.

For the nine months ended September 30, 2018 and the year ended December 31, 2017, we generated $2.6 million and $2.7 million in revenue and our net loss was $30.1 million and $40.9 million, respectively. These results reflect that we currently have only one commercialized product, SU Canola, which is available in the United States and, on a limited basis, in Canada.

Our Proprietary Technologies

We are pioneering a new technological era in agriculture that leverages our expertise in genomics, gene editing and cell culture. Desirable plant traits can take decades to successfully develop and commercialize through conventional and transgenic techniques. RTDS can achieve the results of these processes on a non-transgenic basis, introducing into plants customizable, specific and predictable combinations of value-enhancing traits that can be commercialized in less than five years. RTDS functions effectively as a “trait machine” that enables us to isolate a single plant cell, make the desired genetic edits in that cell, and regenerate that cell into an entire plant. We have developed the know-how to design traits that meet specific customer demands. In this regard, RTDS is capable of delivering multiple desirable traits (or “stacked” traits) within the same plant. For example, starting with our elite, herbicide-tolerant canola parent seed, we have developed traits such as pod shatter reduction, which increases yields realized by farmers, and improved oil quality, which appeals to consumers.

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The trait machine enables us to provide customized plant products with tailored traits to our seed company licensing partners, based upon such company’s specific needs, tailored for the demands and geographic location of their farmer customers, as illustrated in the following graphic:


We have developed extensive genomics and computational biology expertise, which enables us to determine what to edit based upon a deep understanding, at a molecular level, of which genes or edits to those genes contribute to specific characteristics of a plant. Our proprietary process begins by isolating single plant cells for editing. We harness the cell’s intrinsic DNA repair system to edit specific targeted bases within the genome, which can include using a gene repair oligonucleotide, or “GRON.” The GRON acts as a “DNA template,” guiding the cell’s innate repair machinery to make specific edits to the DNA’s targeted base pairs. In some cases, we use DNA-breaking reagents, such as CRISPR-Cas9, which act as “molecular scissors,” to make site-specific cuts in the DNA of the plant cell. Once the repair process is complete, any editing reagents are entirely degraded by the cell’s natural processes. At this point we have precisely edited a single plant cell. This genetically edited cell does not contain any foreign genetic material, establishing our technology as truly non-transgenic, both in process and product. This aspect of our technology distinguishes Cibus from competitors who deploy transgenic gene-editing processes. Once the presence of the new trait is confirmed, we apply our proprietary, industry-leading cell culture expertise to regenerate and grow an entire plant with the desired traits introduced by our targeted edits. Our product is nature-identical, whereby it mirrors a desirable plant trait that could occur in plants through randomly occurring mutations in nature or through conventional plant breeding.

Our proprietary technologies and traits are protected by more than 300 patents and patent applications worldwide across 16 patent families. We hold key patents and patent applications with respect to RTDS gene-editing methods, oligonucleotide-directed mutagenesis (“ODM”) molecules, delivery methods for our ODM molecules, and applications of our RTDS technologies. We believe our patent portfolio provides us with a significant competitive advantage and creates a barrier to entry for potential competitors.

Market and Industry Overview

As the global human population rises and arable land and water become increasingly scarce, agricultural inputs are the primary means of increasing crop yields. According to Phillips McDougall, three of the largest agricultural input markets in 2017 by global sales were fertilizers, crop protection chemicals and seeds. Within

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the $39 billion global seed industry, seeds with traits developed through biotechnology, or biotech seeds, account for $21 billion and represent the most profitable and highest growth component of these input markets. Further, as trait development technologies continue to advance, the size of the global seed industry is expected to grow.

More than 20 years ago, new seed breeding technologies transformed the global seed industry, leading to rapid improvements in crop yields and nutritional content. One critical advance was genetic engineering—the ability to alter genes to produce a plant with a specific, desired trait, such as herbicide tolerance, insect resistance or drought tolerance. Historically, these advancements have relied upon transgenic modification, which is the integration of recombinant DNA from other species to develop a non-native characteristic. Crops developed through transgenic modification are developed by integrating foreign DNA, encoding the desired trait randomly into a plant cell’s DNA, typically disrupting an existing gene’s function. The random nature of this technique means that it typically takes thousands of integrations and subsequent evaluations before a desired trait is successfully expressed in the target crop. Further, after several generations of propagation, the modified gene may not continue to properly express the desired trait. Despite these technological challenges, in the United States, nearly 100% of planted acres in certain large crop markets, including cotton and soybean, are crops developed through transgenic modification.


More recently, biotechnology companies have deployed gene-editing technologies for crop trait development. Most gene-editing techniques make use of site-directed DNA-breaking nucleases that can make breaks in both strands of DNA at specific locations. The subsequent repair of these DNA breaks can then modify the plant’s genes. The processes employed in modern gene-editing techniques, and the resulting products, can either be transgenic or non-transgenic. Non-transgenic gene editing has a number of advantages over transgenic modification, including precision, faster trait development, potential to identify new gene functions, high specificity and ability to stack traits in novel ways. The combined speed, accuracy and lower cost of non-transgenic gene editing enables the commercially viable development of seeds for a broader range of crops than transgenic modification. Because modern gene editing is either mostly, or in the case of our RTDS, completely non-transgenic, it has the potential to bring the benefits of biotech seeds to more markets over time.

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The Canola Seed Market

We are currently marketing seed traits for canola through our own branded seed, SU Canola. In September 2018, in anticipation of our launch of future traits in our branded canola seeds, we relaunched our branded canola seeds under the brand name, Falco.

Canola, a cultivar of rapeseed, is an important source of healthy vegetable oil. In the 1970s, canola was developed by researchers at the University of Manitoba in Canada by breeding rapeseed to be more suitable for human and animal consumption. Globally, nearly 90 million acres of canola and oilseed rape are planted each year of which approximately 25 million acres, with a seed market value of approximately $1.4 billion, are planted in North America. Approximately 90% of North American canola acreage is in Canada.

One of the most efficient oil-producing crops, canola seed contains more than 40% oil with low levels of saturated fats. Canola is highly valued for its versatile applications in the food, feed and biodiesel fuel markets. Further, canola is a high-growth crop. According to the U.S. Department of Agriculture (the “USDA”) and the Canola Council of Canada, Canadian canola production has grown at a compound annual growth rate of 5.9% between 1995 and 2017 as during that period the total planted acreage has nearly doubled from approximately 13 million to 23 million acres.

Our decision to initially focus on canola was driven by the early interest in our technology from canola farmers and producers. Compared to larger crop markets, such as corn and soybean, we believe canola has been underserved by global agriculture conglomerates and chemical producers, as evidenced by their relatively insignificant investment in canola research and development and their failure to introduce new transgenic traits in canola over the last decade. Our technology has demonstrated our ability to cost-effectively develop canola traits that increase value and yield for our canola farmer customers.

Our first canola product, SU Canola, is a non-transgenic sulfonylurea (SU) herbicide tolerant canola. We offer SU Canola as a weed control alternative that promotes sound resistance management options to help control glyphosate-resistant weeds, and it is a logical rotation partner to glyphosate-resistant crops such as Roundup Ready soybeans. Additionally, SU Canola’s status as non-GMO/non-BE in the United States under the USDA’s

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standards and non-genetically engineered in Canada allows our North American farmer customers to capitalize on premiums offered when selling their non-GMO canola grain. According to Agribusiness Intelligence, total North American production of non-GMO canola oil is projected to increase by 91% from 2017 to 2027, at a compound annual growth rate of 7%. Since being launched in the United States two years ago, SU Canola has attained approximately a 4% share in the U.S. canola market, and we are preparing for a full launch of the product in Canada in the provinces of Manitoba and Saskatchewan in the 2019 growing season.

Our Value Proposition to Farmers and the Commercial Opportunity it Creates

Farmers’ profit is generally determined by taking the revenue generated when they sell their crop and deducting the cost of their inputs and labor. Our seeds and traits are designed to add value on both sides of this equation.

Farmers’ Revenue

A farmer’s revenue from the sale of crops is a factor of volume and price. Given a fixed amount of farmable land, volume is primarily driven by yield, which is the amount of sellable output per acre of land. Yield is impacted by many factors, including seed, weather, disease, pests and other stresses, both external and internal to the crop being grown. Cibus has traits in development for reduced pod shatter in canola and for disease tolerance in multiple crops. Because these traits have the potential to significantly increase crop yield, they have the corresponding potential to increase a farmer’s revenue.

With respect to price, a crop with a desirable trait typically results in a premium paid to farmers for their output. For example, due to strong demand for non-GMO canola oil and meal, both Cargill and Bunge, two of the largest processors in North America, offer premiums to farmers who deliver grain produced from our SU Canola seed to their crushing facilities. As a result, a farmer who delivers one metric ton of grain produced from our SU Canola would receive $35 in additional revenue for that growing season compared to a farmer who delivers an equivalent amount of grain that is not eligible for the Cargill or Bunge non-GMO premium.

Other traits that we are developing, such as high-oleic oil, also have the potential to command premiums in the marketplace for our farmer customers.

Farmers’ Input Costs

Farmers need four primary crop inputs: seed, fertilizer, crop protection and labor.

Planted seeds require fertilizer to augment yields when soil nutrition is a limiting factor, and crop protection products are applied to protect yield by killing weeds (herbicides) that compete with the crop for resources and by controlling disease and pests (fungicides and insecticides) that might kill or damage the crop. The objective of seed and fertilizer inputs is to increase yield; in contrast, the focus of crop protection inputs is to preserve destruction of existing yield capacity.

Additionally, labor and associated costs (equipment, fuel, etc.) are used to plant the crop, apply the other inputs and facilitate harvest.

Over the past several decades, seed technology, primarily transgenic trait development, has transferred some of the value from the other input categories into the seeds. For example, herbicide resistant seeds have reduced the volume and frequency of herbicide application for a farmer, providing herbicide cost savings and reduced herbicide application labor costs. Likewise, disease resistant seeds are anticipated to reduce the volume and frequency of fungicide applications. Any net reduction in these input costs has the ability to directly improve the farmer’s profitability, and lower herbicide and fungicide use to produce the crop is likely to appeal to consumers and the environment, thereby reducing the impact of high efficiency agriculture production.

The Commercial Opportunity

Historically, given the potential for higher profitability, farmers have been willing to pay for the incremental value created by the increased yield and/or reduced input and labor costs of higher technology seed. For example, as new herbicide resistance and yield enhancing traits were introduced into the North American canola market, the average price per bag of seed rose significantly. Since 2008, the average price of a 50-pound (10-acre) bag of canola seed has almost doubled from approximately $395 to $700, according to AGDATA. At a

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macro level, this seed technology value creation is evidenced by the increase in total value of the principal seed markets into which significant new traits have been introduced—corn and soybean, and, to a lesser extent, cotton and canola. Heavy investment by large agricultural chemical companies in traits for corn and soybean, which represent over 60% of the seed industry’s $39 billion market value, has driven yield and hybrid performance, generating value for the farmer and for the trait development/seed companies.

With estimated costs of up to $135 million and the approximately 10 to 13 years required to develop and commercialize a new trait, large market participants have not focused on developing transgenic traits beyond corn, soybean, cotton and canola—with cotton and canola being underserved relative to corn and soybean. Transgenic crops only represent approximately 13% of global arable land use. Our RTDS technologies allow for non-transgenic trait development and commercialization in less than five years at a cost of less than $10 million, allowing us to also pursue trait development and commercialization in alternative crops, such as flax, potato and other underserved crops. The lower cost and increased speed of RTDS allow for trait development, and the creation of higher value seeds, in a wide range of less mature crop markets, creating “white space opportunities.” These trait development white space opportunities represent new value that can be shared with farmers, much like those in corn and soybean. For example, rice and potato—crops with a combined accessible market of $4.2 billion globally—are crops with little or no historical trait development, creating white space opportunities for the development of herbicide and disease resistance.


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Our Competitive Strengths

We believe that we are strategically well-positioned to develop innovative traits and products with high-value commercial applications. Our competitive strengths include:

Proprietary, non-transgenic gene-editing technology and significant cell culture expertise and know-how that distinguishes us from competitors. Our patent-protected RTDS can deliver multiple desirable traits within the same plant without the integration of foreign genetic material. Our technology sets us apart from other gene-editing companies as a result of its non-transgenic foundation, in both process and product. Furthermore, over our 17-year history, we have developed a cell culture technology that enables us to design and transfer a plant in the greenhouse with desirable traits within just a few months.
Focus on delivering novel solutions that make farmers more profitable. We are strategically focused on developing novel solutions that drive value for farmers in crops, particularly crops which have been underserved due to limitations in existing technology and cost from development to commercialization. While there has historically been significant investment for transgenic trait development in crops such as corn and soybean and, to a lesser extent, cotton and canola, we are now able to introduce new, non-transgenic traits for crops such as rice, flax, cassava and potato in an efficient and low-cost manner. These crops have been neglected by large market participants and have little or no historical trait development, providing us access to significant market opportunities with limited competition from transgenic crops. We believe our ability to increase the value of crops by introducing alternative and novel traits will be a significant demand driver as farmers search for solutions that can increase their profitability.
Ability to stack traits and develop customized seed products that benefit farmers, processors and consumers. Through RTDS, we have established a reproducible, automated process whereby we can develop customized plant products with multiple desirable traits specifically chosen to meet needs across the agricultural value chain. As a result, we can offer products that, for example, enhance crop yields for farmers while producing healthier and more nutritious foods for consumers. This demonstrated ability to stack multiple, desirable traits in plants distinguishes us from other agricultural gene-editing companies. We expect our first stacked products, SU Canola with each of our yield protection (pod shatter reduction) and/or disease tolerance trait, to be launched between 2020 and 2023. With RTDS, we are developing a trait portfolio across major crops that addresses significant market opportunities. SU Canola and our near-term portfolio of canola traits validates the power of RTDS and demonstrates to potential licensing customers the commercial viability of our non-transgenic gene-editing process.
Recognized as non-transgenic in key target markets due to our unique process and products. Numerous regulatory agencies in the Americas, including the United States, Canada and Argentina, have confirmed that our RTDS-developed trait products are non-transgenic and are not subject to heightened GMO regulation in these markets. The non-transgenic categorization of our trait products in these key target markets provides us with significant advantages. First, we are able to bring our seeds to market quickly and at a low cost, in part because our products are not subject to the time-consuming regulatory hurdles that apply to transgenic products. Further, we are well-positioned to capitalize on increasing consumer demand for non-GMO products in these target markets.
Capital-efficient and highly scalable business model. We have a capital-efficient, low-cost and highly-scalable business model. Our trait licensing strategy is based on our core strengths in research and development and trait development. We will continue to focus on advancing our gene-editing technologies toward developing plants with desired characteristics and intend to largely partner and license our traits to leading seed companies who will manage plant breeding and commercialization. Focusing on trait development while leveraging our licensing partners’ breeding and commercialization expertise, market presence and geographic reach will reduce our expenses and allow us to pursue diversified growth across multiple revenue streams and invest across the agricultural value chain to commercialize products.
Premier management team with broad expertise. Our management and senior leadership team has more than 300 years of cumulative industry experience and brings broad knowledge across key areas of

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our business, including research and development, seed marketing, patent royalty management and regulatory compliance and oversight. Our Chief Executive Officer, Dr. Peter Beetham, and our Chief Scientific Officer, Dr. Greg Gocal, are founding members of the management team and each played a key role in developing our RTDS. Our leadership has a significant track record of scientific breakthroughs and product development at prestigious academic and research institutions and well-known agri-business companies, including the Boyce Thompson Institute at Cornell University, the Salk Institute for Biological Studies, Chemtura Corp., Monsanto Company, Dow AgroSciences LLC, Mycogen Seeds and DeKalb Genetics Corp. with memberships in the American Seed Trade Association, Canadian Seed Trade Association and European Seed Association.

Our Growth Strategy

Our objective is to be the leading provider of non-transgenic traits to market participants across the agricultural value chain in a broad variety of crop markets. We believe that there are significant opportunities to grow our business on a global basis by executing on the following key elements of our strategy:

Commercialize a full line of our own branded canola seed in North America. Our first commercial product, SU Canola in North America, has sold out its inventory in each of its first three years on the market as demand from existing and new customers has exceeded our annual supply each year, subject to returns pursuant to the Cibus return policy. We will continue to expand our distribution networks and work with our processor business partners, such as Cargill and Bunge, to take advantage of this market momentum and continue to gain market share with new, innovative canola products. Expanding beyond SU Canola, we expect to launch up to three next-generation canola hybrids in 2019 and each of our yield protection trait (pod shatter reduction) and our disease tolerance trait between 2020 and 2023, which we believe positions us to be able to offer the best performing product in the $1.4 billion North American canola seed market.
Pursue trait-licensing collaborations with market-leading seed companies in canola (oilseed rape) and other crops and geographies. In addition to commercializing our canola seed products in North America, we intend to license our RTDS-developed desirable plant traits to third-party seed companies. We are well positioned to develop multiple traits in parental lines for our licensing partners’ most elite hybrids. We believe that combining our traits with their leading regional germplasm and market presence is cost efficient and can lead to the rapid adoption and market acceptance of our technologies.
Advance our research and development capabilities to remain at the forefront of non-transgenic gene editing and advanced plant breeding. We believe RTDS comprises the leading non-transgenic gene-editing technologies and advanced plant breeding techniques. We will continue to invest in, and improve upon, our core strengths in research and development to maintain this leadership position. For example, in addition to our established customizable crop platforms in canola, rice, flax, potato and cassava, we are using RTDS to develop crop platforms in peanut, wheat and corn. We also intend to develop a crop platform in soybean, with the potential to expand to all other major crops. We intend to develop multiple plant traits, including herbicide modes of action, key disease tolerances and yield enhancements in canola, rice, flax, potato, peanut, wheat, corn and soybean. Our goal is to launch six traits in three crops within the next five years, each of which we believe addresses a significant market opportunity by creating value for farmers, processors and consumers. We also have opportunities to extend our gene-editing expertise to other applications, including through our Nucelis team, who is deploying RTDS for non-transgenic trait development in microorganisms, principally yeast, bacteria and algae.
Continue to engage with regulatory agencies as policies evolve, and gain market share as global markets open to non-transgenic gene-edited crops. Regulatory authorities around the world have been working for many years to interpret or adapt existing regulations in relation to gene-editing technologies such as those deployed within RTDS. Some authorities, such as those in the United States, Canada, Argentina, Brazil and Chile, have established regulatory procedures that identify crops developed through non-transgenic breeding technologies as non-GMO or not subject to heightened GMO regulation. As a result, it is anticipated that non-transgenic, nature-identical crops developed through RTDS will not be subject to GMO regulation in these territories. In other jurisdictions, regulatory authorities and policy-makers are at various stages of internal review or expert and public

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consultation, and we will follow such developments closely. A growing number of national governments recognize the potential of gene editing and are encouraging innovation to help address the challenges faced by sustainable food production worldwide. These governments are seeking consistent and proportional regulatory policies for gene-edited crops in order to promote much-needed innovation and to facilitate global trade. Working within a developing regulatory framework we will continue to work closely with regulatory agencies and policy-makers to ensure we meet their requirements to facilitate regulatory approval of our products.

Risk Factors

There are a number of risks that you should understand before making an investment decision regarding this offering. These risks are discussed more fully in the section entitled “Risk Factors” following this prospectus summary.

The Reorganization Transactions

Cibus Ltd. was incorporated in Bermuda on September 12, 2018 to serve as the issuer of the Class A common shares offered in this offering and the Class B common shares. Cibus Global is our predecessor company. In connection with the closing of this offering, we will consummate the following reorganizational transactions:

We will amend the organizational documents of Cibus Global to provide, among other things, that Cibus Global shall have a single director. Cibus Ltd. will concurrently be appointed to serve as the sole director of Cibus Global.
All of the issued and outstanding preferred shares in Cibus Global will be converted on a one-for-one basis into the existing class of Non-Voting Equity Interests in Cibus Global (the “Conversion”), and following completion of the Conversion, Cibus Global will undertake a           -for-one reverse Equity Interest split. After the reverse split, a total of           Equity Interests (all of which will be Non-Voting Equity Interests) will be outstanding in Cibus Global. As a result of the Conversion, all of the issued and outstanding warrants that were exercisable for preferred shares will become exercisable in accordance with their terms for Non-Voting Equity Interests (the “Warrants”).
Cibus Ltd. will acquire 100% of the issued and outstanding Equity Interests of Cibus Global held by each of the Blockers (as defined herein) through the acquisition from the Blocker Owners (as defined herein) of all of the shares in the Blockers in exchange for a number of Class A common shares equal to the number of Cibus Global Equity Interests held by such Blockers.
Cibus Ltd. will offer to acquire, directly or indirectly through a wholly-owned subsidiary of Cibus Ltd. (such wholly-owned subsidiary, “Cibus Holdings”) all of the Equity Interests (all of which will be Non-Voting Equity Interests) in Cibus Global held by the Mandatorily Exchanging Owners and Other Exchanging Owners (each as defined herein), in each case, in exchange for an equal number of our Class A common shares, subject, in the case of restricted Equity Interests, to adjustments to take into account applicable threshold values. Cibus Ltd. will also offer to acquire, directly or indirectly through Cibus Holdings, all of the Warrants held by the Mandatorily Exchanging Owners and Other Exchanging Owners for a number of Class A common shares taking into account the exercise price of such Warrants.
Cibus Ltd. will utilize the net proceeds from this offering to purchase, directly or indirectly through Cibus Holdings, newly issued Voting Equity Interests in Cibus Global at a purchase price per Equity Interest equal to the initial public offering price per Class A common share, less underwriting discounts and commissions (the “Net IPO Price”), collectively representing          % of Cibus Global’s issued Equity Interests. Cibus Global will, in turn, use a portion of the proceeds from the sale of such newly issued Voting Equity Interests as described in “Use of Proceeds,” including to purchase all of the issued Equity Interests in Cibus Global and Warrants held by certain non-accredited investors.
The Original Cibus Global Equity Owners (other than those referenced above) will continue to own their Equity Interests (all of which will be Non-Voting Equity Interests) in Cibus Global and Warrants following completion of this offering. These Continuing Cibus Global Equity Owners will also be issued Class B common shares of Cibus Ltd., which will have no “economic interests” in Cibus Ltd.

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(such economic interests meaning the right to receive any distributions or dividends from Cibus Ltd.). Following this offering, each such Continuing Cibus Global Equity Owner will be entitled to cause Cibus Global to redeem some or all of such Continuing Cibus Global Equity Owner’s vested Equity Interests for an equal number of newly issued Class A common shares (with a corresponding cancellation of an equal number of such Continuing Cibus Global Equity Owner’s Class B common shares), subject, in the case of restricted Equity Interests, to adjustments to take into account applicable threshold values.

The foregoing transactions are discussed in further detail under “Our Structure and Reorganization.” Immediately following this offering, and as a result of these related transactions, Cibus Ltd. will be a holding company whose principal asset will consist of Voting Equity Interests and Non-Voting Equity Interests in Cibus Global, such Equity Interests in Cibus Global being held by Cibus Ltd. either directly or indirectly through Cibus Holdings.

The diagram below depicts our organizational structure after giving effect to the Reorganization Transactions summarized above, and after giving effect to the offering of Class A common shares:


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Corporate Information

Cibus Ltd., the issuer of the Class A common shares in this offering, was incorporated in Bermuda on September 12, 2018. Our principal executive offices are located at 6455 Nancy Ridge Drive, San Diego, California 92121, and our telephone number is +1 (858) 450-0008. We also maintain a website at www.cibus.com. The information contained in, or that can be accessed through, our website is not part of this prospectus.

Implications of Being an Emerging Growth Company

We qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups (JOBS) Act of 2012 (the “JOBS Act”). As an emerging growth company, we may take advantage of certain reduced disclosure and other requirements that are otherwise applicable generally to public companies. Pursuant to these provisions:

we are not required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”);
we are required to have only two years of audited financial statements, and correspondingly only two years of related disclosure in Management’s Discussion and Analysis of Financial Condition and Results of Operations; and
we have (i) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and (ii) exemptions from the requirements of holding a non-binding advisory vote on executive compensation, including golden parachute compensation.

We may take advantage of these provisions for up to five years or until such earlier time that we are no longer an emerging growth company.

We would cease to be an emerging growth company upon the earliest to occur of (1) the last day of the fiscal year in which we have more than $1.07 billion in annual revenue; (2) the date we qualify as a “large accelerated filer,” with at least $700 million of equity securities; (3) the issuance, in any three-year period, by us of more than $1.0 billion in non-convertible debt securities held by non-affiliates; and (4) the last day of the fiscal year ending after the fifth anniversary of our initial public offering.

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can use the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the “Securities Act”) for complying with new or revised accounting standards. This permits an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the exemptions discussed above. Accordingly, the information contained herein may be different than the information you receive from other public companies.

We are also a “smaller reporting company” as defined in Regulation S-K under the Securities Act and have elected to take advantage of certain of the scaled disclosures available to smaller reporting companies. We may be a smaller reporting company even after we are no longer an emerging growth company.

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THE OFFERING

Issuer in this offering
Cibus Ltd.
Class A common shares offered by us
          shares.
Underwriters’ option to purchase additional shares
The underwriters have a 30-day option to purchase up to           additional Class A common shares from us as described under the heading “Underwriting.”
Total number of Class A common shares to be outstanding after this offering
          shares (          shares if the underwriters exercise their option in full).
Total number of Class B common shares to be outstanding after this offering
          shares, all of which will be owned by the Continuing Cibus Global Equity Owners.
Voting rights
Holders of our Class A common shares and Class B common shares will vote together as a single class on all matters presented to shareholders for their vote or approval except as otherwise required by law. Each Class A common share and Class B common share will entitle its holder to one vote per share on all such matters, except that the aggregate voting power of the Class B common shares will be limited to    %. Upon completion of the Reorganization and this offering, Former Cibus Global Equity Owners and Continuing Cibus Global Equity Owners will collectively hold approximately       % of the total combined voting power of the Class A and Class B common shares. See “Description of Share Capital.”
Voting power held by holders of Class A common shares after giving effect to this offering
   %.
Voting power held by holders of Class B common shares after giving effect to this offering
   %.
Use of proceeds
We estimate that the net proceeds to us from this offering will be approximately $    million, or approximately $    million if the underwriters exercise in full their option to purchase additional Class A common shares, assuming an initial public offering price of $          per share (the midpoint of the range set forth on the cover page of this prospectus), after deducting estimated underwriting discounts and commissions and estimated offering expenses.

We intend to use the net proceeds that we receive from this offering to purchase Equity Interests in Cibus Global at a purchase price per Equity Interest equal to the Net IPO Price.

We intend to cause Cibus Global to use a portion of such proceeds to (i) purchase all of the Equity Interests in Cibus Global held by certain investors in Cibus Global and (ii) satisfy certain withholding tax obligations, if applicable, that arise in connection with

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the disposition of Equity Interests by Original Cibus Global Equity Owners in connection with the Reorganization Transactions (see “Our Structure and Reorganization”), and will cause Cibus Global to use the remainder of such proceeds to fund research and development, to build out commercial capabilities and for working capital and general corporate purposes, as described in greater detail under “Use of Proceeds.”

Exchange rights of holders of Equity Interests
The Continuing Cibus Global Equity Owners, from time to time following the offering, may require Cibus Global to redeem or exchange all or a portion of their Equity Interests for newly-issued Class A common shares on a one-for-one basis in accordance with the terms of the Amended and Restated Cibus Global Memorandum of Association and Articles of Association to be effective upon the closing of this offering (the “Cibus Global Association Documents”), subject to adjustments to take into account applicable threshold values. See “Certain Relationships and Related Party Transactions—Amended and Restated Cibus Global Memorandum of Association and Articles of Association.” In connection with any such redemption of a Continuing Cibus Global Equity Owner’s Equity Interests, such Continuing Cibus Global Equity Owner’s corresponding Class B common shares will be cancelled on a one-for-one basis.
Registration Rights Agreement
Pursuant to the Amended and Restated Registration Rights Agreement (the “Registration Rights Agreement”), we will, subject to the terms and conditions thereof, agree to register the resale of the Class A common shares that are issuable to the Continuing Cibus Global Equity Owners upon redemption or exchange of their Equity Interests and the Class A common shares that are issued to the Former Cibus Global Equity Owners in connection with the Reorganization Transactions. See “Certain Relationships and Related Party Transactions—Registration Rights Agreement.”
Directed share program
The underwriters have reserved for sale at the initial public offering price up to approximately    % of the Class A common shares being offered by this prospectus for sale to our directors, officers and certain employees and other parties with a connection to the Company. We will offer these shares to the extent permitted under applicable regulations. The number of shares available for sale to the general public in this offering will be reduced to the extent these persons purchase reserved shares. Any reserved shares not purchased will be offered by the underwriters to the general public on the same terms as the other shares.

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Risk factors
Investing in our Class A common shares involves a high degree of risk. See “Risk Factors” beginning on page 18 of this prospectus for a discussion of factors you should carefully consider before investing in our Class A common shares.
Nasdaq symbol
“CBUS”

The number of our Class A common shares to be outstanding after this offering is based on the Equity Interests of Cibus Global and excludes:

          Class A common shares reserved for issuance under our 2018 Incentive Compensation Plan (as defined and described in “Executive Compensation—Equity-Based Awards”), consisting of (i)           Class A common shares issuable upon the exercise and/or vesting of awards granted on or following the date of this prospectus to our directors and certain employees, including the named executive officers, in connection with this offering and (ii)           additional Class A common shares reserved for future issuance;
          Class A common shares issuable upon the exercise of warrants outstanding as of          ; and
          Class A common shares reserved for future issuance upon redemption or exchange of Equity Interests by the Continuing Cibus Global Equity Owners.

Unless we specifically state otherwise, or the context otherwise requires, the information in this prospectus assumes:

no exercise of the outstanding options or warrants described above; and
no exercise of the underwriters’ option to purchase up to an additional           Class A common shares.

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SUMMARY HISTORICAL AND PRO FORMA CONSOLIDATED FINANCIAL DATA

The following table presents the summary historical and pro forma consolidated financial data for Cibus Global and its subsidiaries. Cibus Global is the predecessor of the issuer, Cibus Ltd., for financial reporting purposes. The summary consolidated statements of operations data for each of the years ended December 31, 2017 and 2016, and the summary consolidated balance sheets data as of December 31, 2017 and 2016 are derived from Cibus Global’s audited consolidated financial statements, included elsewhere in this prospectus. The summary consolidated statements of operation data for each of the nine months ended September 30, 2018 and 2017, and the summary consolidated balance sheet data as of September 30, 2018 are derived from Cibus Global’s unaudited consolidated financial statements, included elsewhere in this prospectus. The results for the nine months ended September 30, 2018 are not necessarily indicative of the results that may be expected for the full year.

The summary financial information below should be read together with “Selected Historical Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in conjunction with the consolidated financial statements, related notes and other information included elsewhere in this prospectus.

The historical results are not necessarily indicative of future results. The summary financial information below does not contain all the information included in our financial statements.

The summary unaudited pro forma consolidated financial data presented below have been derived from our unaudited pro forma consolidated financial statements included elsewhere in this prospectus. The summary unaudited pro forma consolidated statements of operations for the year ended December 31, 2017 and for the nine months ended September 30, 2018, assumes the Reorganization Transactions and this offering were completed on January 1, 2017. The summary unaudited pro forma consolidated balance sheet as of September 30, 2018 assumes the Reorganization Transactions and this offering were completed on September 30, 2018. The unaudited pro forma financial information includes various estimates which are subject to material changes and may not be indicative of what our operations or financial position would have been, had this offering and related transactions taken place on the date indicated, or that may be expected to occur in the future. See “Unaudited Pro Forma Financial Data” for a complete description of the adjustments and assumptions underlying the summary unaudited pro forma consolidated financial data.

The summary historical consolidated financial and other data of Cibus Ltd. have not been presented, as Cibus Ltd. is a newly incorporated entity, has had no business transactions or activities to date, and had no assets or liabilities during the periods presented in this section.

 
Historical Cibus Global
Pro Forma Cibus Ltd.
 
Nine Months Ended
September 30,
Year Ended
December 31,
Nine Months Ended
September 30,
2018
Year Ended
December 31,
2017
 
2018
2017
2017
2016
 
(In thousands)
Revenue:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Product sales, net
$
2,372
 
$
1,839
 
$
1,839
 
$
597
 
 
            
 
 
            
 
Collaboration and research
 
253
 
 
705
 
 
848
 
 
1,196
 
 
 
 
 
 
 
Collaboration and research - related party
 
 
 
 
 
 
 
440
 
 
 
 
 
 
 
Total revenue
 
2,625
 
 
2,544
 
 
2,687
 
 
2,233
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of product sales
 
1,853
 
 
1,060
 
 
1,060
 
 
1,007
 
 
 
 
 
 
 
Selling, general and administrative
 
12,457
 
 
9,824
 
 
13,752
 
 
13,052
 
 
 
 
 
 
 
Research and development
 
13,475
 
 
13,092
 
 
17,111
 
 
19,854
 
 
 
 
 
 
 
Total operating expenses
 
27,785
 
 
23,976
 
 
31,923
 
 
33,913
 
 
 
 
 
 
 
Loss from operations
 
(25,160
)
 
(21,432
)
 
(29,236
)
 
(31,680
)
 
 
 
 
 
 

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Historical Cibus Global
Pro Forma Cibus Ltd.
 
Nine Months Ended
September 30,
Year Ended
December 31,
Nine Months Ended
September 30,
2018
Year Ended
December 31,
2017
 
2018
2017
2017
2016
 
(In thousands)
Other (income) expense, net:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest income
$
(81
)
$
 
$
 
$
(6
)
 
 
 
 
 
 
Interest expense
 
56
 
 
177
 
 
78
 
 
57
 
 
 
 
 
 
 
Interest expense - related parties
 
 
 
6,045
 
 
6,179
 
 
61
 
 
 
 
 
 
 
Interest expense, royalty obligation - related parties
 
4,867
 
 
3,796
 
 
5,259
 
 
4,225
 
 
 
 
 
 
 
Other expense, net
 
123
 
 
49
 
 
144
 
 
22
 
 
   
 
 
   
 
Total other (income) expense, net
 
4,965
 
 
10,067
 
 
11,660
 
 
4,359
 
 
 
 
 
 
 
Loss on equity method investment
 
 
 
 
 
 
 
(100
)
 
 
 
 
 
 
Net loss
$
(30,125
)
$
(31,499
)
$
(40,896
)
$
(36,139
)
 
 
 
 
 
 
Less: Deemed distribution to preferred shareholders
 
 
 
(5,314
)
 
(5,314
)
 
 
 
 
 
 
 
 
Net loss attributable to common shareholders
$
(30,125
)
$
(36,813
)
$
(46,210
)
$
(36,139
)
 
 
 
 
 
 
Net loss per share attributable to common shareholders, basic and diluted
$
(2.04
)
$
(2.80
)
$
(3.40
)
$
(3.54
)
 
 
 
 
 
 
 
Historical Cibus Global
Pro Forma Cibus Ltd.
 
As of
September 30, 2018
As of December 31,
As of
September 30, 2018
Consolidated Balance Sheets Data:
2017
2016
 
(In thousands)
Cash and cash equivalents
$
25,502
 
$
6,549
 
$
7,173
 
 
 
 
Total assets
 
34,156
 
 
13,128
 
 
13,190
 
 
 
 
Total liabilities
 
35,974
 
 
30,598
 
 
22,115
 
 
 
 
Accumulated deficit
 
(224,257
)
 
(194,132
)
 
(153,236
)
 
 
 
Total shareholders' deficit
 
(1,818
)
 
(17,470
)
 
(8,925
)
 
 
 

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RISK FACTORS

Investing in our Class A common shares involves a high degree of risk. You should consider carefully the following risks, together with all the other information in this prospectus, including the financial statements and notes thereto, before you invest in our Class A common shares. If any of the following risks actually materializes, our operating results, financial condition and liquidity could be materially adversely affected. As a result, the trading price of our Class A common shares could decline and you could lose all or part of your investment.

Risks Related to Our Business and Operations

We have a limited operating history, which makes it difficult to evaluate our current business and future prospects.

We have a limited operating history that to date has been focused primarily on research and development, conducting field trials and commercializing our initial product, SU Canola. While we are developing numerous product candidates, we currently have only one commercialized product, SU Canola, which is only available in the United States and, on a limited basis, in Canada. Consequently, we have generated only limited revenue, substantially all of which is attributable to U.S. sales of SU Canola.

Our limited operating history may make it difficult to evaluate our current business and our future prospects. We have encountered, and will continue to encounter, risks and difficulties frequently experienced by growing companies in the rapidly developing biotechnology and gene-editing industries. These risks and difficulties include challenges in determining appropriate investments of our limited resources, gaining market acceptance of the products and traits developed using RTDS, managing a complex regulatory landscape, developing new product candidates and competing against other companies operating in the biotechnology and gene-editing spaces. We may also face challenges in scaling our supply chain in a cost-effective manner, as we will rely on contracting with seed production companies, seed distributors, farmers, chemical herbicide companies and crushers / crop processors in connection with the commercialization of our products.

We may not be able to fully implement or execute on our commercial strategy or realize, in whole or in part within our expected time frames, the anticipated benefits of our growth strategies. You should consider our business and prospects in light of the risks and difficulties we face as a growing company focused on developing biotechnology products and trait product candidates.

We have incurred significant losses and anticipate that we will continue to incur significant losses for the foreseeable future.

Our net loss for the nine months ended September 30, 2018 and for the years ended December 31, 2017 and 2016 was $30.1 million, $40.9 million and $36.1 million, respectively. As of September 30, 2018, we had an accumulated deficit of $224.3 million. The amount of our future net losses will depend, in part, on the amount of our future operating expenses and the pace at which they are incurred, the satisfaction of our Royalty Obligation (as defined herein) and our interest expense related thereto, and our ability to obtain funding through our commercialization activities, through equity or debt financings or through grants or partnerships.

With respect to our Royalty Obligation, we expect the liability balance to continue to increase each year until 2035, as the accretion of interest expense will outpace the cash payments for royalties due, and the related non-cash interest expense recorded to increase in conjunction with the underlying liability balance. We have only one commercialized product—our proprietary branded SU Canola seed—which is only available in the United States and, on a limited basis, in Canada. As a result of our limited commercial activities, we expect to continue to incur significant expenses and operating losses for the foreseeable future. We anticipate that such expenses will increase substantially if and as we, directly or through partners:

grow and develop our sales, marketing and distribution infrastructure, including relationships across our supply chain, to support the commercialization of our branded canola seed products in the United States and Canada, and the negotiation of license arrangements for our crop traits, in each case, once they have completed the applicable development process;
conduct additional field trials of our current and future product candidates;
secure manufacturing arrangements for commercial seed production for our branded canola seed products;

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continue to advance the research and development of our current and future product candidates, develop additional crop platforms and pursue the automation of our trait machine;
seek to identify and validate additional product candidates;
acquire or in-license other technologies, germplasm or biological material;
seek regulatory and marketing approvals (including non-GMO certification) for our product candidates;
make royalty and other payments under any in-license agreements;
maintain, protect, expand and defend our intellectual property portfolio;
seek to attract and retain new and existing skilled personnel;
extend for longer periods than originally expected sales incentives (e.g., rebates and customer rewards) that we offer to farmers in order to grow market share and gain market acceptance; and
experience any delays or encounter issues with any of the above.

The net losses we incur may fluctuate significantly from year-to-year and quarter-to-quarter, such that a period-to-period comparison of our results of operations may not be a good indication of our future performance. In any particular period or periods, our operating results could be below the expectations of securities analysts or investors, which could cause the price of our Class A common shares to decline.

We face significant competition and many of our competitors have substantially greater financial, technical and other resources than we do.

The markets for agricultural biotechnology seeds and traits are highly competitive, and we face significant competition in both our branded canola seed and trait licensing businesses. Competition for improving plant genetics comes from conventional and advanced plant breeding techniques, as well as from the development of desirable plant traits through gene-editing techniques. Competition for the discovery of new desirable traits based on biotechnology is likely to come from a relatively small number of major global agricultural chemical companies, smaller biotechnology research companies and institutions, and academic institutions. For improving crop yields, our traits compete as a system with other practices, including the application of crop protection chemicals, fertilizer formulations, farm mechanization, other biotechnology, and information management. Programs to improve genetics and chemistry are generally concentrated within a relatively small number of large companies, while non-genetic approaches are underway with a broader set of companies. Future mergers and acquisitions may result in even greater concentration of resources among a smaller number of competitors.

Many of our current or potential competitors, either alone or with their research and development or collaboration partners, have significantly greater financial resources and expertise in research and development, manufacturing, testing and marketing approved products than we do. Smaller or early-stage companies may also prove to be significant competitors, particularly through research and development and collaborative arrangements with large and established companies. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel, as well as in acquiring technologies complementary to, or necessary for, our programs.

Our ability to compete effectively depends, in part, on our ability to successfully: evaluate crop trait needs and market demand; control costs; price and market our product candidates; develop a commercialization channel; develop new crop trait product candidates that are attractive to participants across the agricultural value chain; navigate regulatory requirements; and commercialize product candidates in a timely and cost-efficient manner. We may not be successful in developing these capabilities and any such failure may adversely affect our business, results of operations and financial condition.

Many of our existing competitors invest substantial resources in ongoing research and development, and we also anticipate increased competition as new companies enter the market. To the extent that our competitors introduce new technologies, particularly in the area of gene editing, such developments could render our products or technology obsolete, less competitive or uneconomical. In this case, such technological advances or new approaches to trait development could prevent or limit our ability to generate revenue from the commercialization of our product candidates.

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We rely on gene-editing technologies that may become obsolete in the future.

We rely on our proprietary RTDS technologies, such as the GRON, to develop our product candidates. If our competitors are able to refine existing gene-editing technologies to be, or develop new gene-editing technologies that are superior to our RTDS technologies, we may face reputational damage and a decline in the demand for our products. Our technologies may be rendered obsolete or uneconomical by technological advances or entirely different approaches developed by one or more of our competitors that are more effective than RTDS or that enable them to develop and commercialize products more quickly or with lower expense than we are able to do. If for any reason our technology becomes obsolete or uneconomical relative to our competitors’ technologies, this would prevent or limit our ability to generate revenues from the commercialization of our products.

Our business activities are currently conducted at a limited number of locations, and damage or business disruptions at these locations would have an adverse effect on our business.

Our current headquarters is located in San Diego, California. Substantially all of our research and development operations and early breeding processes, during which we create genotypic variability and genetic combinations to test, are conducted at our headquarters location. Our first generation parent seed is also created by Cibus staff near our headquarters in greenhouses or fields. All hybrids designated for testing are developed using several different cooperators primarily in Chile. Warehousing for key germplasm seed assets is replicated at least twice within the United States. In addition, later generation parental seed for pre-commercial and commercial hybrids is multiplied by third-party contractors which, along with the derived hybrid seed, is produced and located in the United States and Chile. We use a limited number of seed conditioning and packaging partners, whose facilities are located in the same geographies or close to the market. We take precautions to safeguard our facilities, including maintaining customary insurance coverage, and implementing safety protocols, and keeping critical research results and computer data backed-up on off-site storage networks. However, damage to, or destruction of, critical facilities, equipment, inventory or development projects, or any business disruptions at our critical locations, whether due to natural disasters, acts of vandalism or otherwise, could cause substantial reduction in sales revenues, delays in our operations and could cause us to incur additional expenses.

Loss of or damage to our germplasm libraries would significantly slow our product development efforts.

We have a comprehensive collection of our own proprietary germplasm in which we are developing traits for our branded canola seed products. In addition, we will partner with seed companies to develop our product candidates in their germplasm. Germplasm comprises genetic material covering the diversity of a crop, the attributes of which are inherited from generation to generation. Germplasm is a key strategic asset since it forms the basis of plant breeding programs. To the extent that we lose access to germplasm because of the termination or breach of our licensing agreements, or as a result of insufficient quantities of germplasm for testing, breeding and commercial use in relevant geographies, our product development capabilities could be negatively impacted. In addition, loss of or damage to our germplasm would significantly impair our research and development activities. Although we restrict access to our germplasm at our facilities to protect this valuable resource, we cannot guarantee that our efforts to protect our germplasm will be successful. The destruction or theft of a significant portion of our germplasm collection would adversely affect our business and results of operations.

Our product candidate development efforts may not be successful, and the rate of product candidate development may be slower than expected.

Investment in our product candidate development is a highly speculative endeavor that entails substantial research and development efforts using complex technology platforms, such as our RTDS. These product candidate development efforts require significant investments, including expenses relating to laboratory, greenhouse and field testing. For the nine months ended September 30, 2018 and for the years ended December 31, 2017 and 2016, we incurred $13.5 million, $17.1 million and $19.9 million, respectively, on research and development expenses. We intend to continue to invest in research and development to develop and validate our product candidates. Notwithstanding our investments in research and development, there is significant risk that we will not be able to achieve our product candidate development goals in the desired timeframe or at all, and we may not realize significant product revenue in the near term, if ever.

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Moreover, the application of gene-editing technologies can be unpredictable, and may prove to be unsuccessful when attempting to achieve desired traits in different crops and plants. For example, our traits that perform in the greenhouse may not achieve similar performance levels in the field, or may achieve varying performance levels as a result of environmental and geographic conditions. Any such variations could substantially harm our ability to commercialize the relevant product candidate.

The development of crop trait product candidates using innovative and complex technologies, such as our RTDS, is subject to the risks that, among other things:

our product candidates fail to perform as expected in the field;
we are unable to regenerate and grow a plant with a desired trait introduced through targeted edits to a single plant cell using our RTDS;
our product candidates do not receive necessary regulatory approvals and governmental clearances in our targeted markets;
our products exhibit unanticipated undesirable agronomic performance or other unanticipated effects;
our products are viewed as too expensive by farmers or other market participants in the agricultural value chain;
our product candidates are difficult to produce on a large scale; and
we are unable to fully develop or commercialize our products in a timely manner or at all.

Lastly, the field of gene editing, particularly in plants, is still in its early stages. Unexpected or negative developments from the use of RTDS, including with respect to the exhibition of unanticipated undesirable traits, could adversely affect the commercial value of our products and harm our reputation. In addition, negative developments arising from our competitors’ use of transgenic and non-transgenic gene-editing technology could harm the reputation of gene-editing technology, generally.

We may direct our limited resources toward product candidates that prove to be less profitable or successful than others that we did not pursue.

We have limited financial and managerial resources, which we must expend on the basis of our expectations about, and forecasts of, market demand. As a result, we may forego or delay the pursuit of opportunities with certain product candidates that later prove to have greater commercial potential than those that we do choose to develop. Our resource allocation decisions may lead us to fail to capitalize on commercially viable product candidates or profitable market opportunities. Our spending on current and future research and development programs and product candidates may never yield commercially viable products sufficient to sustain our business and operations.

We intend to license the traits we develop to third parties for sale in their brands, and will be dependent on them to successfully commercialize our traits and generate royalties.

In addition to our commercialization of our branded canola seed products in North America, we intend to license substantially all of the traits we develop to third parties for sale in their brands. Our trait licensee customers will primarily be commercial seed companies, but may also include other biotechnology companies, germplasm providers and growers. Once we license a trait to a customer, they will typically oversee its development and commercialization. In such cases, our ability to achieve milestone payments or generate royalties is not within our direct control.

If our licensees are delayed or unsuccessful in introducing our traits into their products or conducting field trials, or if their field trials fail to produce sufficient conclusory data, or if they fail to devote sufficient time and resources to support the marketing and selling efforts of those products, we may not receive royalty payments as expected and our financial results could be harmed. Further, if these licensee customers fail to market products incorporating our traits at prices that will achieve or sustain market acceptance for those products, our royalty revenues could be further harmed.

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Any partnerships that we may enter into in the future may not be successful, which could adversely affect our ability to develop and commercialize our product candidates.

We may seek research and development partnerships or joint venture arrangements with third parties for the development or commercialization of certain product candidates. To the extent that we pursue such arrangements, we will face significant competition in seeking appropriate partners. Moreover, such arrangements are complex and time-consuming to negotiate, document, implement and maintain. We may not be successful in establishing or implementing such arrangements. The terms of any partnerships, joint ventures or other arrangements that we may establish may not be favorable to us.

The success of any future partnerships or joint ventures is uncertain, and will depend heavily on the efforts and activities of our partners. Such arrangements are subject to numerous risks, including the risks that:

our partners may have significant discretion in determining the efforts and resources that they will apply to the arrangement;
our partners may not pursue the development and commercialization of our product candidates based on trial results, changes in their strategic focus, competing priorities, availability of funding, or other external factors;
our partners may delay or abandon field trials, fail to conduct field trials that produce sufficient conclusory data, provide insufficient funding for field trials, or repeat or conduct new field trials;
our partners could develop, independently or with third parties, products that compete with our products;
partners who have marketing, manufacturing and distribution rights with respect to a product may not commit sufficient resources to, or otherwise not perform satisfactorily in carrying out, these activities;
to the extent that such arrangements provide for exclusive rights, we may be precluded from collaborating with others;
our partners may not properly maintain or defend our intellectual property rights, or may use our intellectual property or proprietary information in a way that gives rise to actual or threatened litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential liability;
disputes may arise between us and a partner that causes the delay or termination of the research, development or commercialization of our current or future products, or that results in costly litigation or arbitration that diverts management attention and resources;
such arrangements may be terminated, and, if terminated, may result in a need for additional capital for our independent pursuit of matters previously covered by such arrangement;
our partners may own or co-own intellectual property that results from our arrangement; and
a partner’s sales and marketing activities or other operations may not be in compliance with applicable laws resulting in civil or criminal proceedings.

If ongoing or future field trials are unsuccessful, we may be unable to complete the development of trait product candidates on a timely basis or at all.

We rely on field trials to demonstrate the efficacy of the traits that we have developed and evaluated in greenhouse conditions. Field trials allow us to test the traits that we have developed in the field as well as to increase seed production, and to measure performance across multiple geographies and conditions. The successful completion of field trials is critical to the success of our product development efforts, supports the marketing efforts for our branded canola seed products and will be used to support our licensing efforts with respect to our product candidates. If our ongoing or future field trials are unsuccessful or produce inconsistent results or unanticipated adverse effects on the agronomic performance of our crops, or if the field trials do not produce reliable data, our product development efforts could be delayed, subject to additional regulatory review or abandoned entirely. In addition, in order to support our marketing and licensing efforts, it is necessary to collect data across multiple growing seasons and from different geographies. Even in cases where initial field trials are successful, we cannot be certain that additional field trials conducted on a greater number of acres or in different

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geographies will also be successful. Many factors that are beyond our control may adversely affect the success of these field trials, including unique geographic conditions, weather and climatic variations, disease or pests, or acts of protest or vandalism. Field trials, which may take up to 2–3 years, are costly, and any field trial failures that we may experience may not be covered by insurance and, therefore, could result in increased costs, which may negatively impact our business and results of operations.

We rely on third parties to conduct, monitor, support and oversee field trials, and any performance issues by them may impact our ability to successfully commercialize products or license traits.

We currently rely on third parties, such as growers, consultants, contractors, and universities, to conduct, monitor, support and oversee our field trials. Because field trials are conducted in multiple geographies, it is often difficult for us to monitor the daily activity of the work being conducted by such third parties that we engage. Although we provide our third parties with extensive protocols regarding the establishment, management, data collection, harvest, transportation and storage of our product candidates, we have limited control over the execution of field trials. Poor field trial execution or data collection, failure to follow required agronomic practices, protocols or regulatory requirements, or mishandling of product candidates by these third parties could impair the success of our field trials. Any such failures may result in delays in the development of our product candidates or the incurrence of additional costs. Ultimately, we remain responsible for ensuring that each of our field trials is conducted in accordance with the applicable protocol, legal and regulatory and agronomic standards, and our reliance on third parties does not relieve us of our responsibilities. Should such third parties fail to comply with these standards, our ability to develop our product candidates for licensing or commercialization could be adversely impacted, and we may be forced to incur additional costs in regaining compliance.

Additionally, if we are unable to enter into, or maintain, agreements with such third parties on acceptable terms, or if any such engagement is terminated prematurely, we may be unable to conduct or complete our field trials in the manner we anticipate. If our relationship with any of these third parties is terminated, we may be unable to enter into arrangements with alternative third parties on commercially reasonable terms, or at all. Switching or adding third parties can involve substantial cost and require extensive management time and focus. In addition, there is a natural transition period when any new third party commences field trial work. As a result, delays may occur, which could materially impact our ability to meet our desired development timelines.

We may lack the necessary expertise, personnel and resources to successfully commercialize our branded canola products or to effectively license our traits.

To foster the commercial success of our North American branded canola products and to assist our licensee customers in effectively marketing and commercializing products containing our licensed traits, we will need to develop and build-out our own sales and marketing capabilities and, in the case of our branded canola seed products, our supply and distribution capabilities. Factors that may affect our ability to effectively contribute to such commercialization efforts include our ability to: recruit and retain adequate numbers of effective sales and marketing personnel, effectively develop relationships with commercial seed companies and distributors, secure trait license agreements with seed companies requiring them to undertake specific commercialization activities, and persuade farmers to purchase and use seeds with our traits, whether through our own branded canola seed or traits licensed to third-party seed companies. Developing and maintaining such commercialization capabilities and infrastructure requires significant investment, is time-consuming and could delay the launch of our product candidates. Further, in certain target markets we may not be able to build or maintain an effective commercialization infrastructure. If we are unable to find suitable partners in the jurisdictions in which we seek to license our traits or sell our branded canola seed products, we may have difficulties generating revenue from them.

The commercial success of our branded canola seed products depends on our ability to produce high-quality seeds cost-effectively on a large scale and to accurately forecast demand.

We intend to continue to offer our canola products in North America under our own branded canola seed. The production of commercial-scale quantities of parent and hybrid seeds requires the multiplication of plants and collection of seeds through a succession of plantings and seed harvests. The cost-effective production of high-quality, high-volume quantities of seeds depends on our ability to scale our production processes to produce plants and seeds in sufficient quantity to meet demand. We cannot assure that our existing or future seed

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production techniques will enable us to meet our large-scale production goals cost-effectively for our SU Canola hybrids, or for any of the new, innovative canola products that we launch. If we are unable to maintain or enhance the quality of our canola plants and parent and hybrid seeds as we increase our production capacity, we may experience reductions in farmer demand, higher costs and increased inventory write-offs.

In addition, because of the length of time it takes to produce commercial quantities of marketable seeds, we will need to make seed production decisions well in advance of product sales. Our ability to accurately forecast demand for SU Canola can be adversely affected by a number of factors outside of our control, including changes in market conditions, environmental factors, such as pests and diseases, and adverse weather conditions. As we continue to offer additional branded canola seed products, the demand forecast analysis will become more complex. A shortfall in the supply of our SU Canola product may reduce product revenue, damage our reputation in the market and adversely affect relationships. Any surplus in the amount of SU Canola we have on hand may negatively impact cash flows, reduce the quality of our inventory, and ultimately result in write-offs of inventory. Our estimates regarding the potential size of our target markets for our canola products have not been independently verified and are based on certain assumptions that may not prove to be accurate. As a result, these estimates could differ materially from actual market sizes, which could result in decreased demand for our branded canola seed products and therefore adversely impact our future business prospects, results of operation and financial condition.

Additionally, given that we will have to keep the inventory marked to market on our balance sheet, we will take financial risk in our inventory as a result of fluctuations in seed prices due to market factors, including the spot price of crops containing our canola traits. Any failure on our part to produce sufficient inventory, or overproduction of SU Canola, could harm our business, results of operations and financial condition.

Interruptions in the production or transportation of our parent and hybrid seeds could adversely affect our operations and profitability.

In some cases, we may produce parent seed containing our traits for both our own branded canola products in North America as well as for our licensee customers who will license our traits for incorporation into their own parent lines. While we will be responsible for the production of our own hybrid seed for our branded canola products, our licensee customers will utilize parent seed containing our traits to produce their own hybrids.

We will rely on contract seed producers for our seed production. Poor execution, failure to follow required agronomic practices, protocols or regulatory requirements, or mishandling of product candidates by these contract seed producers could adversely affect our products. Any such failures may result in delays in our ability to deliver parent seed to our licensee customers or for our own hybrid seed production needs in a timely manner. Such delays could adversely affect the ability of our licensee customers or, in the case of our branded canola product, Cibus to deliver hybrid seed products to farmers to meet their planting window. Our dependency upon timely seed deliveries means that interruptions or stoppages in such deliveries, or delays or limitations with respect to seed production, could adversely affect our operations until alternative arrangements could be made. Such a delay would adversely affect our, and our licensee customers’, reputations and revenues and could result in write-offs of inventory. If we were unable to produce the necessary seed for an extended period of time for any reason, our business, customer relations, and operating results could suffer.

We may not be able to identify suitable seed producers to meet our production needs. If we do identify suitable seed producers, we may not be able to enter into cost effective agreements on acceptable terms. If any contract seed producers whom we engage fail to perform their obligations as expected or breach or terminate their agreements with us, or if we are unable to secure the services of such third parties when and as needed, we may lose opportunities to generate revenue from product sales.

Our third-party distributors and retailers may not effectively market and sell our branded canola seed products.

We depend in part on third-party distributors and retailers for the marketing and selling of our branded canola seed products in North America. We are unable to control their efforts completely. If our distributors and/or retailers fail to effectively market and sell our branded canola seed products, or to do so in full compliance with all applicable laws, our operating results and business may suffer.

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The unintended presence of our traits in other products or plants, or of transgenes in our products, may negatively affect us.

Trace amounts of our traits may unintentionally be found outside our containment area in the products of third parties, which may result in negative publicity and claims of liability brought by such third parties against us. Furthermore, in the event of an unintended dissemination of our gene-edited germplasm into the environment, or the presence of unintended trace amounts of our traits in conventional seed, or in the grain or products produced from conventional crops, we could be subject to claims by multiple parties, including environmental advocacy groups, as well as governmental actions such as mandated crop destruction, product recalls, or additional stewardship practices and environmental cleanup or monitoring.

In addition, as a result of the greater use of transgenic seeds by farmers in the regions in which our seed is produced, the adventitious presence of transgenes in the seeds we produce may occur due to unintended cross pollination. We regularly test for the adventitious presence of transgenes in our seed products and product candidates. The adventitious presence of transgenes in our seed products and product candidates would adversely affect our ability to sell that seed and could require crop or seed destructions, reducing our inventory of saleable product which could adversely affect our business, customer relations, and operating results.

Our trait products are new, and if farmers are unable to work effectively with crops containing our traits, our various relationships, our reputation and our results of operations will be harmed.

We provide farmers purchasing our SU Canola, and we intend to work with customers who license our traits for incorporation into their own products to provide to their farmer customers, with information and protocols regarding the establishment, management, harvest, transportation and storage of crops containing our traits. These crop management recommendations may include equipment selection, planting and harvest timing, application of crop protection chemicals such as herbicides and storage systems and protocols. Further, these recommended protocols may require a change in current planting, rotation or agronomic practices, which may be difficult to implement or may discourage the use of our products by agricultural producers. Our general or specific protocols may not apply in all circumstances, may be improperly implemented, may not be sufficient, or may be incorrect, leading to reduced yields, crop failures or other production problems or losses. If farmers purchase seed with our traits on the basis of yield expectations that are not realized, or if crushers or other processors are unable to accept or effectively process crops containing our traits, we will experience damage to our relationships and reputation and the ability to achieve commercial success for our branded and licensed products, notwithstanding the cause for such failures. In addition, if farmers assert that deficiencies in crop yield or quality result from inherent product features rather than external factors, we may seek to offer such farmers financial, or other, incentives to preserve our customer relationships. For instance, a small percentage of the SU Canola acres planted with our prior-generation product have sought redress for yield shortfalls in the last growing season. Although we are working with the provider of our seedsmen’s errors and omissions insurance provider to resolve these claims, we may in some circumstances make payments even in the absence of insurance coverage for specific claims. In any event, statements by customers about negative experiences, or negative outcomes with products containing our traits, could harm our reputation, and the decision by these customers or other potential customers not to proceed with large-scale seed purchases could harm our business, revenue and ability to achieve profitability.

Our products may not achieve commercial success quickly or at all.

In addition to the commercialization of our branded canola seed products in North America, we intend to license our RTDS-developed plant traits to third-parties—primarily, seed companies. Although our SU Canola product is commercially available in the United States and, on a limited basis, in Canada, our branded canola seed remains relatively new to the market. Beyond SU Canola, our traits are in various stages of development, and there are no established channels to market for their commercialization by potential licensee customers.

If we are unable to commercially license our traits on a significant scale or if we are unable to achieve the targeted market penetration of our SU Canola product, then we may not be successful in building a sustainable or profitable business. Moreover, we have priced our SU Canola and expect to price our trait licenses based on our assessment of the value that we believe they will provide within the agricultural value chain, rather than on the cost of production. If seed company licensees, farmers or other market participants attribute a lower value to our traits or branded canola seed products than we do, they may not be willing to pay the premiums that we

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expect to charge. Pricing levels may also be negatively affected if our traits are unsuccessful or suboptimal in enhancing the yields or exhibiting the characteristics that we expect.

Market participants, including commercial seed companies and farmers, may also be cautious in their adoption of seeds containing our traits, with conservative initial purchases and proof of crop success required prior to widespread deployment. It may take several growing seasons for farmers to adopt seeds containing our traits, whether in our branded canola seeds or through brands of third parties, on a large scale. In order to induce farmers to purchase our SU Canola branded seed product, we have offered various rebates and commercial incentives. We may need to extend such branded canola seed sales incentives, or create new sales or licensing incentives for other product candidates, in order to grow market share and gain market acceptance, for longer periods than originally expected, which would reduce our profits.

Public understanding of our RTDS technologies and public perception and acceptance of gene-editing technologies, including our RTDS technologies, could affect our sales and results of operations and impact government regulation of our products.

The success of our branded canola products and the ability of our licensee customers to successfully commercialize products containing our traits depends, in part, on public understanding and acceptance of plant gene editing. Farmers, seed companies and end-product consumers may not understand the nature of our RTDS technologies or the scientific distinction between our non-transgenic products and processes and transgenic products and processes of competitors. As a result, these parties may transfer negative perceptions and attitudes regarding transgenic products to our products and product candidates. A lack of understanding of our RTDS technologies may also make consumers more susceptible to the influence of negative information provided by opponents of biotechnology. Some opponents of biotechnology actively seek to raise public concern about gene editing, whether transgenic or non-transgenic, by claiming that plant products developed using biotechnology are unsafe for consumption or use, pose risks of damage to the environment, or create legal, social and ethical dilemmas. The commercial success of our products and product candidates may be adversely affected by such claims, even if unsubstantiated. In addition, extreme opponents of biotechnology have vandalized the fields of farmers planting biotech seeds and facilities used by biotechnology companies. Any such acts of vandalism targeting the fields of our farmer customers, our field testing sites or our research, production or other facilities, could adversely affect our sales and our costs.

Negative public perceptions about gene editing can also affect the regulatory environment in the jurisdictions in which we are targeting the sale of our products and the commercialization of our product candidates. Any increase in such negative perceptions or any restrictive government regulations in response thereto, could have a negative effect on our business and may delay or impair the sale of our products or the development or commercialization of our product candidates. Even following receipt of regulatory approvals or confirmation of non-regulated status in a jurisdiction, public pressure in that jurisdiction may lead to increased regulation of products produced using biotechnology, further legislation regarding novel trait development technologies, or administrative litigation concerning prior regulatory approvals, each of which could adversely affect our ability to sell our product or commercialize our product candidates. In addition, labeling requirements in effect from time to time could heighten public concerns and make consumers less likely to purchase food products containing gene-edited ingredients.

Negative public perception could have adverse impacts throughout the agricultural value chain, leading farmers, processors and other market participants to limit purchases of our products or to reduce the premium that they are willing to pay for our products. If we are not able to overcome these concerns, our traits and products containing our traits may not achieve market acceptance.

Products produced from crops containing our traits may fail to meet standards established by third-party non-GMO verification organizations, which could reduce the value of our traits to customers.

Certain third-party organizations offer verification programs that seek to make non-GMO products easily identifiable for consumers. These organizations verify the non-GMO status of products (such as foods, beverages and vitamins) based on independently developed standards, and often authorize the display of specific markers or labels illustrating such status on the verified product’s packaging. Although the verification programs seek to identify finished products as non-GMO verified, the processes that they employ typically examine the individual ingredients and precursors, rather than the finished products.

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Standards established by such third-party organizations for the verification of non-GMO status may differ from applicable regulatory legal standards governing non-GMO classification in the United States, Canada or other of our target markets. As a result, notwithstanding a regulatory determination as to the non-GMO status of our RTDS technologies, products or product candidates in a particular jurisdiction, products containing our traits may fail to meet more restrictive or non-scientific standards imposed by these independent verification organizations. For example, a third-party verification organization could determine that it will withhold its non-GMO verification from any product developed using biotechnology, whether it is transgenic or not.

If third-party verification organizations were to determine that any products containing our traits, or gene-edited products generally, did not meet their non-GMO verification standards, and certified non-GMO seals or labels were not available for such products, our reputation could be harmed, these products may be unable to demand non-GMO premiums, which could reduce the value of our traits to farmer customers, and our operating results could be adversely affected.

Our insurance coverage may be inadequate to cover all the liabilities we may incur.

We face the risk of exposure to liability claims if any of our seed is defective and if any product that we develop or any product that uses our technologies or incorporates any of our traits causes injury. Although we carry insurance at levels customary for companies in our industry, such coverage may become unavailable or be inadequate to cover all liabilities we may incur. There can be no assurance that we will be able to continue to maintain such insurance, or obtain comparable insurance at a reasonable cost, if at all. If we are unable to obtain sufficient insurance coverage at an acceptable cost or otherwise, or if the amount of any claim against us exceeds the coverage under our policies, we may face significant expenses.

We expect to derive a meaningful portion of our future revenues from commercial products sold outside the United States, which subjects us to additional business risks.

Our SU Canola product is in the process of being fully launched in Canada, and a meaningful number of our product candidates are under development for licensing and commercialization in markets outside the United States. Commercialization in jurisdictions outside of the United States is subject to a variety of risks, including different regulatory requirements, uncertainty of contract and intellectual property rights, unstable political and regulatory environments, economic and fiscal instability, tariffs and other import and trade restrictions, restrictions on the ability to repatriate funds, business cultures accepting various levels of corruption and the impact of anti-corruption laws. These risks could result in additional cost, loss of materials and delays in our commercialization timeline in international markets and have a negative effect on our operating results.

Revenues generated outside the United States could also be subject to increased difficulty in collecting delinquent or unpaid accounts receivable, adverse tax consequences, currency and exchange rate fluctuations, relatively high inflation, exchange control regulations and governmental pricing directives. Acts of terror or war may impair our ability to commercialize products in particular countries or regions and may impede the flow of goods and services between countries. Customers in these and other markets may be unable to purchase our products if their economies deteriorate, or it could become more expensive for them to purchase imported products in their local currency or sell their commodities at prevailing international prices, and we may be unable to collect receivables from such customers. If any of these risks materialize, our results of operations and profitability could be harmed.

We have identified material weaknesses in our internal control over financial reporting. If our remediation of these material weaknesses is not effective, or if we experience additional material weaknesses in the future, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect investor confidence in us and, as a result, the value of our Class A common shares.

In connection with the audit of the consolidated financial statements of Cibus Global, our predecessor for accounting purposes, as of and for the year ended December 31, 2017, we identified material weaknesses in our internal control over financial reporting. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

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The material weaknesses we identified were as follows:

We did not design and maintain an effective control environment commensurate with our financial reporting requirements. Specifically, we lacked a sufficient complement of professionals with the level of accounting knowledge, training and experience to design and maintain the underlying controls to analyze, record and disclose accounting matters timely and accurately. This material weakness contributed to the two material weaknesses below.

We did not design and maintain effective controls over the identification of, accounting for and disclosure of related party transactions. Specifically, we did not design and maintain effective controls and procedures to identify a complete population of related parties, to monitor changes in that population, nor to properly account for and disclose transactions with related parties.

We did not design and maintain effective controls over segregation of duties related to manual journal entries. Specifically, certain personnel had the ability to both prepare and post manual journal entries without an independent review by someone without the ability to prepare and post journal entries.

The material weakness relating to the identification of, accounting for and disclosure of related party transactions contributed to adjustments recorded in our consolidated financial statements as of and for the year ended December 31, 2017 and the revision of our consolidated financial statements as of and for the year ended December 31, 2016, as described in Note 17 to the consolidated financial statements, related to our accounting for research and development services obligations with a related party. That material weakness also resulted in a material audit adjustment being made to our consolidated financial statements as of and for the year ended December 31, 2017 related to our accounting for warrants to purchase Series C convertible preferred shares issued to related parties which decreased additional paid in capital and increased interest expense with related parties. The material weakness related to manual journal entries did not result in a misstatement to our consolidated financial statements. Additionally, each of these control deficiencies could result in a misstatement of our accounts or disclosures that would result in a material misstatement of our annual or interim consolidated financial statements that would not be prevented or detected, and accordingly, we determined these control deficiencies constitute material weaknesses.

We have initiated remediation efforts focused on improving our internal control over financial reporting and to specifically address the control deficiencies that led to our material weaknesses. These efforts include the following:

Hiring of our chief financial officer in April 2018.
Hiring of a corporate controller in May 2018.
Retaining a technical accounting consulting firm in August 2018 to provide additional depth and breadth in our technical accounting and financial reporting capabilities. We intend to continue this arrangement until permanent technical accounting resources are identified and hired.
Continuing our investment in the design and implementation of our financial control environment, including policies and procedures, controls, reporting and analysis, and training.

We cannot be assured that the measures we have taken to date, and are continuing to implement, will be sufficient to remediate the material weaknesses we have identified or avoid potential future material weaknesses. If the steps we take do not remediate the material weaknesses in a timely manner, we will be unable to conclude that we maintain effective disclosure controls and procedures or effective internal control over financial reporting. Additionally, these material weaknesses could result in a misstatement of our accounts or disclosures that would result in a material misstatement of our annual or interim consolidated financial statements that would not be prevented or detected.

As a public company, we will be required to maintain adequate internal control over financial reporting and to report any material weaknesses in our internal control over financial reporting. SEC Regulation S-K requires that we evaluate and determine the effectiveness of our internal control over financial reporting and, beginning with our second annual report following this offering, which will be for our fiscal year ending December 31, 2019, provide a management report on internal control over financial reporting. Regulation S-K also requires that our management report on internal control over financial reporting be attested to by our independent registered

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public accounting firm, to the extent we are no longer an emerging growth company. We do not expect our independent registered public accounting firm to attest to our management report on internal control over financial reporting while we are an emerging growth company.

We are in the process of evaluating our internal control over financial reporting required to comply with this obligation, and this process will be time consuming, costly and complicated. If we identify any additional material weaknesses in our internal control over financial reporting, if we are unable to comply with the requirements of Regulation S-K in a timely manner, if we are unable to assert that our internal control over financial reporting is effective, or when required in the future, if our independent registered public accounting firm is unable to express an unqualified opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in our financial reports and the market price of our Class A common shares could be adversely affected.

Our Royalty Obligation may contribute to net losses and cause the market price for our Class A common shares to fluctuate.

Pursuant to our Royalty Obligation, we are required to make quarterly royalty payments equal to 10% of all revenue attributable to our RTDS technologies, subject to certain exceptions, to investors who are party to the Warrant Exchange Agreement, including members of our Board of Directors and officers. The financial interest of certain of our directors and officers under the Royalty Obligation may create real or perceived conflicts of interest between shareholders’ interests and those of such affiliates.

The requirement to make quarterly payments pursuant to the Royalty Obligation commences with the first quarter in which the aggregate revenue attributable to our RTDS technologies during any consecutive 12-month period equals or exceeds $50 million. At commencement, we will be required to pay all aggregated but unpaid royalty payment amounts. Our Royalty Obligation has an initial term of 30 years following the date on which the first royalty payment becomes due and payable, subject to a subsequent 30-year extension, at the option of the holders, for a payment of $100. Our payments under, and performance of, the Royalty Obligation are secured by a security interest in substantially all of our intellectual property. The satisfaction of our Royalty Obligation and our interest expense related thereto may adversely affect the cash flow available for our operations, particularly in connection with the initial payment of aggregated, but unpaid, royalty payment amounts.

We recorded a Royalty Obligation liability of $9.9 million, which represented the aggregate fair value of the warrants exchanged pursuant to our Warrant Exchange Agreement, on our consolidated balance sheet as of each of December 31, 2015 and 2014. Changes in expected royalty payments, as a result of changes to estimates of the underlying revenues, are accreted to interest expense using the effective interest method. As royalties are paid over the life of the arrangement, we estimate the total amount of future royalty payments over the life of the Royalty Obligation that will be required to be paid to holders of royalty rights. We reassess these estimated royalty payments periodically and, if the amount or timing of royalty payments differs materially from our prior estimates, we will prospectively adjust the accretion of the effective interest expense. As of September 30, 2018, and December 31, 2017, we reported a $25.8 million and $20.9 million Royalty Obligation liability, respectively. Fluctuations in the liability balance of our Royalty Obligation due to changes in our business model and anticipated revenues from product candidates in development may cause the market price of our Class A common shares to fluctuate.

We may need to raise additional funding, which may not be available on acceptable terms or at all. Failure to obtain this necessary capital when needed may force us to delay, limit or terminate our product development efforts or other operations.

The process of developing product candidates is expensive, lengthy and risky. The commercialization of our own branded canola products in North America results in even greater expenditures of time and resources, and exposes us to additional risks. We expect our research and development expenses to increase substantially as we continue to develop our existing product candidates and identify new product candidates for development. Further, as a result of our increasing commercialization efforts with respect to SU Canola and any future branded canola products in North America, as well as our efforts with respect to licensing of our product candidates currently under development, our selling, general and administrative expense may increase significantly in the next several years.

As of September 30, 2018, we had cash and cash equivalents of approximately $25.5 million. We believe our cash and cash equivalents, together with the net proceeds from this offering, will be sufficient to fund our

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operations for the next     years. However, in order to continue our ongoing research and development process, pursue regulatory approval, where applicable, and pursue our licensing and commercialization efforts, as applicable, we expect to require additional funding. Also, our operating plan, including our product candidate development plans, may change as a result of many factors currently unknown to us, and we may need to seek additional funds sooner than planned, through public or private equity or debt financings, government or other third-party funding, marketing and distribution arrangements and other strategic alliances and licensing arrangements, or a combination of these approaches.

To the extent that we raise additional capital through the sale of additional equity or convertible securities, your ownership interest may be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a shareholder. Debt financing, if available, would result in increased fixed payment obligations and a portion of our operating cash flows, if any, being dedicated to the payment of principal and interest on such indebtedness. In addition, debt financing may involve agreements that include restrictive covenants that impose operating restrictions, such as restrictions on the incurrence of additional debt, the making of certain capital expenditures or the declaration of dividends. To the extent that we raise additional funds through arrangements with research and development partners or otherwise, we may be required to relinquish some of our technologies, product candidates or revenue streams, license our technologies or product candidates on unfavorable terms, or otherwise agree to terms unfavorable to us. Any additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to develop and commercialize our product candidates. In addition, we cannot guarantee that future financing will be available in sufficient amounts or on terms acceptable to us, if at all. Even if we believe we have sufficient funds for our current or future operating plans, we may seek additional capital if market conditions are favorable or in light of specific strategic considerations.

If we are unable to obtain funding on a timely basis, we may be required to significantly curtail, delay or discontinue one or more of our research or product candidate development programs or the commercialization of any product candidate or be unable to expand our operations or otherwise capitalize on our business opportunities, as desired, which could materially affect our business, operating results and prospects and cause the price of the Class A common shares to decline.

Risks Related to Our Industry

The estimates of market opportunity and forecasts of market growth included in this prospectus may prove to be inaccurate, and our business could fail to achieve the same growth rates as others in the biotech seeds market.

Market opportunity estimates and market growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. The estimates and forecasts included in this prospectus relating to the size and expected growth of the global seed industry and the biotech seeds market, and the estimated ranges of incremental value increase that a novel, newly developed crop trait may produce, may prove to be inaccurate. Even if the markets in which we compete achieve these opportunity estimates and market growth forecasts, our business could fail to grow at similar rates, if at all.

The overall agricultural industry is susceptible to commodity and raw material price changes.

Prices for agricultural commodities, including canola, and their byproducts are often volatile and sensitive to local and international changes in supply and demand caused by a variety of factors, including general economic conditions, farmer planting and selling decisions, government agriculture programs and policies, global and local inventory levels, demand for biofuels, weather and crop conditions, food safety concerns, government regulations, and demand for and supply of, competing commodities and substitutes. As a result, we may not be able to anticipate or react to changing costs by adjusting our practices, which could cause our operating results to deteriorate. We do not engage in hedging or speculative financial transactions nor do we hold or issue financial instruments for trading purposes.

The successful commercialization of our SU Canola as well as the commercialization of our trait licensing product candidates may also be adversely affected by fluctuations in the prices of agricultural commodities and agricultural inputs, such as fertilizer, energy, labor and water, in each case caused by market factors beyond our control. Changes in the prices of certain raw materials used by farmers in growing our crops could result in higher overall costs along the agricultural supply chain. Depending on the nature of such price changes, the

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cultivation of certain crops could be impacted to a greater extent than others. Increases in fertilizer or herbicide prices due to higher raw material costs could adversely affect demand for our products or product candidates. As a result of competitive conditions, we may not be able to recoup increases in costs through increases in sales prices for our products.

Adverse weather and environmental conditions and natural disasters can cause significant costs and losses.

The ability to grow crops is vulnerable to adverse weather and environmental conditions, including windstorms, floods, drought and temperature extremes, which are quite common but difficult to predict. The severity and frequency of such conditions are also influenced by ongoing global climate change. Unfavorable growing conditions can reduce both crop size and crop quality. This risk is particularly acute with respect to regions or countries in which we plan to focus our commercial efforts, such as the North American canola market. In extreme cases, entire harvests may be lost in some geographic areas as a result of weather and environmental conditions.

The ability to grow crops is also vulnerable to crop disease and to pests, which may vary in severity and effect, depending on the stage of crop production at the time of infection or infestation, the type of treatment applied and climatic conditions. The costs to control disease and pest infestations vary depending on the severity of the damage and the extent of the plantings affected, and the availability of technologies capable of effectively controlling the applicable disease or infestation.

Adverse weather and environmental conditions and natural disasters can increase costs, decrease revenues and lead to additional charges to earnings, which may have a material adverse effect on our business, financial position and results of operations.

The agricultural industry is highly seasonal, which may cause our sales and operating results to fluctuate significantly.

The sale of plant and seed products is dependent upon growing and harvesting seasons, which vary from year to year and across geographies as a result of weather-related shifts in planting schedules and purchase patterns of farmers. Seasonality in our industry is expected to result in both highly seasonal patterns and substantial fluctuations in quarterly sales and profitability for our business.

Seasonality also relates to the limited windows of opportunity that farmer customers have to complete required tasks at each stage of crop cultivation. Weather and environmental conditions and natural disasters, such as heavy rains, hurricanes, hail, floods, tornadoes, freezing conditions, excessively hot or cold weather, drought or fire, affect decisions by farmers about the types and amounts of seeds to plant and the timing of harvesting and planting such seeds. Should adverse conditions occur during key growing and harvesting seasons, such conditions could substantially impact demand for agricultural inputs, including seeds. Any delayed or cancelled orders as a result of such conditions would negatively affect the quarter in which they occur and cause fluctuations in our operating results.

Risks Related to Regulatory and Legal Matters

Regulatory requirements for gene-edited products are uncertain and evolving. Adverse changes in the current application of these laws would have a significant negative impact on our ability to develop and commercialize our product candidates.

Changes in regulatory requirements applicable to our products or product candidates could result in a substantial increase in the time and costs associated with developing our product candidates and negatively impact our operating results. The United States is deemed a self-regulatory jurisdiction, wherein it is industry’s responsibility to comport with applicable rules in the first instance, subject to appropriate regulatory oversight by government agencies. Currently, transgenic technologies used in agriculture are overseen by the USDA’s Animal and Plant Health Inspection Service (“APHIS”). The USDA has authority to regulate plant pests under the Plant Protection Act (the “PPA”). The USDA regulates, among other things, the introduction (including the importation, interstate movement, or release into the environment—such as field testing) of genetically engineered organisms that are plant pests or that there is reason to believe may become plant pests. Such organisms and products are considered “regulated articles.” A genetically engineered organism is no longer subject to the plant pest provisions of the PPA when the USDA determines it is unlikely to pose a plant pest risk.

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A petitioner may submit a request to the USDA for a determination of “non-regulated status” for a particular article. A petition for determination of non-regulated status is a comprehensive package of data and detailed information, including relevant experimental data and publications, among other things. In 2004, APHIS informed us in writing that products developed using our RTDS (specifically where we used the GRON in an early version of our technologies under the RTDS umbrella) are not subject to regulation under the PPA. Therefore, it is not necessary under current USDA and APHIS regulations to file a notification to conduct a field trial or seek permission to commercialize a product created using those technologies. There can be no guarantee that these governing regulations will not change.

In the event that any of our products or product candidates are found to contain inserted genetic material or otherwise differ from the descriptions we have provided to the USDA, the USDA could determine that such products or product candidates are regulated articles, which would require us to comply with the permit and notification requirements of the PPA. The USDA’s regulations require that companies obtain a permit or file a notification before engaging in the introduction (including the importation, interstate movement, or release into the environment—such as field testing) of “regulated articles.” We cannot predict whether the USDA or advocacy groups will challenge our interpretation of the application of the USDA’s regulations to our products or product candidates, or whether the USDA will alter the manner in which it interprets its own regulations or institutes new regulations, or otherwise modify regulations, or whether additional laws will come into effect, in a way that will subject our products or product candidates to more burdensome standards, thereby substantially increasing the time and costs associated with developing our product candidates. Moreover, we cannot assure you that the USDA will analyze any of our future product candidates in a manner consistent with its analysis of our products or product candidates to date. Complying with the USDA’s plant pest regulations, including permitting requirements, is a costly, time-consuming process and could substantially delay or prevent the commercialization of our products.

Some of our products may be subject to Food and Drug Administration (“FDA”) food product regulations or Environmental Protection Agency (“EPA”) environmental impact regulations. Under sections 201(s) and 409 of the Federal Food, Drug, and Cosmetic Act (the “FDCA”), any substance that is reasonably expected to become a component of food is a food additive, and is therefore subject to FDA premarket review and approval, unless the substance is generally recognized, among qualified experts, as having been adequately shown to be safe under the conditions of its intended use (generally recognized as safe, or “GRAS”), or unless the use of the substance is otherwise excluded from the definition of a food additive. Any food that contains a food additive that is deemed to be unsafe is considered adulterated under section 402(a)(2)(C) of the FDCA. The FDA may classify some or all of our product candidates as containing a food additive that is not GRAS, or otherwise determine that our products contain significant compositional differences from existing plant products that require further review. Such classification would cause these product candidates to require premarket approval, which could delay the commercialization of these product candidates.

The FDA’s thinking on the use of genome editing techniques to produce new plant varieties that are used for human or animal food continues to evolve. To that end, in January 2017, the FDA announced a Request for Comments (“RFC”), seeking public input to help inform its thinking about human and animal foods derived from new plant varieties produced using genome editing techniques. Among other things, the RFC asks for data and information in response to questions about the safety of foods from gene-edited plants, such as whether categories of gene-edited plants present food safety risks different from other plants produced through traditional plant breeding. If the FDA enacts new regulations or policies with respect to gene-edited plants, such policies could result in additional compliance costs and/or delay the commercialization of our product candidates, which could adversely affect our profitability. Any delay in the regulatory consultation process, or a determination by the FDA that our product candidates do not meet regulatory approval standards, could cause a delay in the commercialization of our product candidates, which may lead to reduced acceptance by farmers, processors or public consumers.

In addition, it is also possible that some products, where we introduce novel herbicide tolerances, will be subject to EPA regulation. If the specific novel trait is deemed to be a possible pest or the novel herbicide is part of a new registration, the EPA will regulate the distribution, sale or use. The Biopesticides and Pollution Prevention Division of the office of Pesticide Programs under the Federal Insecticide, Fungicide and Rodenticide Act (“FIFRA”) administers such regulatory oversight. This evaluation will determine the reasonable certainty that no harm from pesticide residues occurs in food and feed. Exemptions and tolerances are set by the FDCA.

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In Canada, the sale of new plant traits, or foods derived from genetically modified plants, is initially regulated through a pre-market notification requirement as “novel foods.” Novel foods, defined in the Canadian Food and Drugs Regulations, include foods derived from a plant that has been genetically modified such that (i) the plant exhibits characteristics that were not previously observed in that plant, (ii) the plant no longer exhibits characteristics that were previously observed in that plant or (iii) one or more characteristics of the plant no longer fall within the anticipated range for that plant. Under Canadian Food and Drugs Regulations, “genetically modify” is broadly defined to mean “to change the heritable traits of a plant, animal or microorganism by means of intentional manipulation,” which encompasses both traditional breeding and newer gene-editing technologies. The Canadian Food Inspection Agency (“CFIA”) and Health Canada (“HC”) make a “novelty” determination of such trait or food, potentially triggering the need for regulatory approval. The CFIA reviews and inspects plants with novel traits (“PNTs”), while HC reviews and inspects novel foods. As defined in legislation PNTs are (i) plants into which a trait or traits have been intentionally introduced and (ii) where the trait is new in Canada and has the potential to impact the environment. Approval of a PNT or a novel food product does not take into account the method with which such product was produced. Rather, Canada employs a product-based (as opposed to a process-based) approach to its regulatory practice. While the CFIA and HC have approved our SU Canola product for commercialization in Canada, we cannot predict whether the CFIA or HC will apply a similar analysis to, or grant such approval of, any of our other product candidates in development. In addition, if traits are generated to provide a crop with herbicide tolerance there is a requirement to seek approval from the Pest Management Regulatory Agency (“PMRA”), a branch of HC. PMRA is responsible for herbicide regulation in Canada and is under the authority of the Pest Control Products Act. Pesticides are stringently regulated in Canada to ensure they pose minimal risk to human health and the environment. Complying with the Canadian regulations, including the product pre-market notification requirement, is a costly, time-consuming process and could substantially delay or prevent the commercialization of our products in North America. In addition, crops grown in Canada using our branded canola seed must comply with Canadian export requirements, including trait clearance for export trade into certain regions and countries.

In the European Union (the “EU”), GMOs and genetically modified food and feed products can only be sold in the market once they have been properly authorized. The procedures for evaluation and authorization of GMOs and genetically modified food and feed products are established by Regulation (EC) 1829/2003 on genetically modified food and feed (“Regulation (EC) 1829/2003”) and Directive 2001/18/EC on the release of GMOs into the environment (“Directive 2001/18/EC”). An application for authorization must be submitted under Directive 2001/18/EC if a company seeks to release GMOs for experimental purposes (e.g., field tests) and/or to sell GMOs, as such or in products, in the market (e.g., cultivation, importation or processing). In turn, an application for authorization must be submitted under Regulation (EC) 1829/2003 if a company seeks to sell GMOs in the market for food and feed use and/or food and feed products containing or produced from GMOs. At the national level, EU member states have the ability to restrict or prohibit GMO cultivation in their territories by invoking grounds such as environmental or agricultural policy objectives, town and country-planning, land use, coexistence, socio-economic impacts or public policy.

In addition, Directive 2001/18/EC, Regulation (EC) 1829/2003 and Regulation (EC) 1830/2003 establish specific labeling and traceability requirements for GMOs and products that contain or are produced from GMOs. Finally, Directives 2002/53/EC and 2002/55/EC require genetically modified varieties to be authorized in accordance with Directive 2001/18/EC and/or Regulation (EC) 1829/2003, as applicable, before they can be included in a “Common Catalogue of Varieties,” which would permit the seeds of such genetically modified varieties to be marketed in the EU.

A recent ruling of the European Court of Justice (“ECJ”) in July 2018 concluded that organisms obtained by modern mutagenesis plant breeding techniques, including ODM technologies, are GMOs and fall, in principle, under Directive 2001/18/EC described above. Complying with such EU regulations, including the pre-market risk assessment and product authorization requirements, is costly and time-consuming, and has no guarantee of success and could therefore substantially delay or totally prevent the commercialization of our products in the EU. See “Business—Government Regulation and Product Approval.”

The regulatory environment varies greatly from region to region and in many countries is less developed than in the United States and the EU.

Outside of the United States and the EU, the regulatory environment around gene editing in plants for food ingredients is uncertain and varies greatly from jurisdiction to jurisdiction. Each jurisdiction may have its own

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regulatory framework regarding genetically modified foods, which may include restrictions and regulations on planting and growing genetically modified plants and in the consumption and labeling of genetically modified foods, which may encapsulate our products. The two leading jurisdictions, the United States and the EU, have distinctly different regulatory regimes. We cannot predict how the global regulatory landscape regarding gene editing in plants for food ingredients will evolve and if we may incur increased regulatory costs as regulations change in the jurisdictions in which we operate.

We cannot predict whether or when any jurisdiction will change its regulations with respect to our products or product candidates. Advocacy groups have engaged in publicity campaigns and filed lawsuits in various countries against companies and regulatory authorities, seeking to halt regulatory approval activities or influence public opinion against genetically engineered products. In addition, governmental reaction to negative publicity concerning our products could result in greater regulation of genetic research and derivative products or regulatory costs that render our product development and commercialization cost prohibitive.

The scale of the commodity food industry may make it difficult to monitor and control the distribution of our products. As a result, our products may be sold inadvertently within jurisdictions where they are not approved for distribution. Such sales may lead to regulatory challenges or lawsuits against us, which could result in significant expenses and management attention.

Government policies and regulations, particularly those affecting the agricultural sector and related industries, could adversely affect our operations and profitability.

Agricultural production and trade flows are subject to government policies and regulations. Governmental policies and approvals of technologies affecting the agricultural industry, such as taxes, tariffs, duties, subsidies, incentives and import and export restrictions on agricultural commodities and commodity products can influence the planting of certain crops, the location and size of crop production, and the volume and types of imports and exports. Future government policies in the United States, Canada or in other countries could discourage farmers from using our products or food processors from purchasing harvested crops containing our traits or could encourage the use of our competitors’ products, which would put us at a commercial disadvantage and could negatively impact our future revenues and results of operations.

We use hazardous chemicals and biological materials in our business. Compliance with environmental, health and safety laws and regulations and any claims relating to improper handling, storage or disposal of these materials could be time consuming and costly.

We are subject to federal, state, local and foreign environmental, health and safety laws and regulations, including those governing laboratory procedures, the handling, use, storage, treatment, manufacture and disposal of hazardous materials and wastes, discharge of pollutants into the environment and human health and safety matters. Our research and development processes may involve the controlled use of hazardous materials, including chemicals and biological materials. We cannot eliminate the risk of contamination or discharge and any resultant injury from these materials. We may be sued for any injury or contamination that results from our use or the use by third parties of these materials, or may otherwise be required to remediate such contamination, and our liability with respect to such claims may exceed any insurance coverage that we maintain or the value of our total assets. Compliance with environmental, health and safety laws and regulations is time consuming and expensive. If we fail to comply with these requirements, we could incur substantial costs and liabilities, including civil or criminal fines and penalties, clean-up costs or capital expenditures for control equipment or operational changes necessary to achieve and maintain compliance. In addition, we cannot predict the impact on our business of new or amended environmental, health and safety laws or regulations or any changes in the way existing and future laws and regulations are interpreted and enforced. These current or future laws and regulations may impair our research, development or production efforts.

Adverse outcomes in future legal proceedings could subject us to substantial damages, adversely affect our results of operations, harm our reputation and result in governmental actions.

We may become party to legal proceedings, including matters involving personnel and employment issues, personal injury, product liability, environmental matters, intellectual property disputes and other proceedings. We may be held liable if our traits do not perform as anticipated by our customers, or if any product that we develop or any product that uses our technologies or incorporates any of our traits causes injury or is found otherwise unsuitable during marketing, sale or consumption. Courts could levy substantial damages against us in connection with claims for injuries allegedly caused by use of our products.

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The detection of unintended traits in our seeds could result in governmental actions such as mandated crop destruction, product recalls or environmental cleanup or monitoring. Concerns about seed quality could also lead to additional regulations being imposed on our business, such as regulations related to testing procedures, mandatory governmental reviews of biotechnology advances, or the integrity of the food supply chain from the farm to the finished product.

Depending on their nature, certain future legal proceedings could result in substantial damages or payment awards that exceed our insurance coverage. We will estimate our exposure to any future legal proceedings and establish provisions for the estimated liabilities where it is reasonably possible to estimate and where an adverse outcome is probable. Assessing and predicting the outcome of these matters will involve substantial uncertainties. Furthermore, even if the outcome is ultimately in our favor, our costs associated with such litigation may be material. Adverse outcomes in future legal proceedings or the costs and expenses associated therewith could damage our market reputation and have an adverse effect on our results of operations.

We are subject to governmental export and import controls that could impair our ability to compete in international markets due to licensing requirements and subject us to liability if we are not in compliance with applicable laws.

Our products and product candidates are subject to export control and import laws and regulations, including the U.S. Export Administration Regulations, U.S. Customs regulations, and various economic and trade sanction regulations administered by the U.S. Treasury Department’s Office of Foreign Assets Controls. Exports of our products and technologies must be made in compliance with these laws and regulations. If we fail to comply with these laws and regulations, we and certain of our employees could be subject to substantial civil or criminal penalties, including the possible loss of export or import privileges; fines, which may be imposed on us and the responsible employees or managers; and, in extreme cases, the incarceration of the responsible employees or managers.

In addition, changes in our products or changes in applicable export or import laws and regulations may create delays in the introduction and sale of our products in international markets, prevent our customers from deploying our products or, in some cases, prevent the export or import of our products to certain countries, governments or persons altogether. Any change in export or import laws and regulations, shift in the enforcement or scope of existing laws and regulations, or change in the countries, governments, persons or technologies targeted by such laws and regulations, could also result in decreased use of our products, or in our decreased ability to export or sell our products to existing or potential customers. Any decreased use of our products or limitation on our ability to export or sell our products would likely adversely affect our business, financial condition and results of operations.

We are subject to anti-corruption and anti-money laundering laws with respect to both our domestic and international operations, and non-compliance with such laws can subject us to criminal and civil liability and harm our business.

We are subject to the U.S. Foreign Corrupt Practices Act of 1977, as amended, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act, the USA PATRIOT Act, and possibly other anti-bribery and anti-money laundering laws in countries in which we conduct activities. Anti-corruption laws are interpreted broadly and prohibit us from authorizing, offering, or directly or indirectly providing improper payments or benefits to recipients in the public or private sector. We may have direct and indirect interactions with government agencies and state affiliated entities and universities in the course of our business. We may also have certain matters come before public international organizations such as the United Nations. We use third-party contractors, strategic commercial partners, law firms, and other representatives for certain aspects of regulatory compliance, patent registration, lobbying, deregulation advocacy, field testing, and other purposes in a variety of countries. We can be held liable for the corrupt or other illegal activities of these third-parties, our employees, representatives, contractors and agents, even if we do not explicitly authorize such activities. In addition, although we have implemented policies and procedures to ensure compliance with anti-corruption and related laws, there can be no assurance that all of our employees, representatives, contractors, partners, or agents will comply with these laws at all times. Noncompliance with these laws could subject us to whistleblower complaints, investigations, sanctions, settlements, prosecution, other enforcement actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, suspension and debarment from contracting with certain governments or other persons, the loss of export privileges, reputational harm, adverse

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media coverage, and other collateral consequences. If any subpoenas or investigations are launched, or governmental or other sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, our business, results of operations and financial condition could be materially harmed. In addition, responding to any action will likely result in a materially significant diversion of management's attention and resources and significant defense costs and other professional fees. Enforcement actions and sanctions could further harm our business, results of operations and financial condition.

Changes in tax laws, treaties or regulations or adverse outcomes resulting from examination of our tax returns, and/or inability to qualify for tax treaty benefits, could adversely affect our financial results.

Our future effective global tax rates could be adversely affected by changes in tax laws, treaties and regulations, both in the United States and internationally. Tax laws, treaties and regulations are highly complex and subject to interpretations. Consequently, we are subject to changing tax laws, treaties and regulations in and between countries in which we operate or are resident. Our income tax expense is based upon the interpretation of the tax laws in effect in various countries at the time that the expense was incurred. A change in these tax laws, treaties or regulations, or in the interpretation thereof, could result in a materially higher tax expense or a higher effective tax rate on our worldwide earnings. If any country successfully challenges our income tax filings based on our structure, or if we otherwise lose a material tax dispute, our effective tax rate on worldwide earnings could increase substantially and our financial result could be materially adversely affected.

In addition, our overall global effective tax rate will be impacted by the extent to which our non-U.S. subsidiaries (and non-U.S. operations) qualify for the benefits of various international tax treaties. Our ability to qualify for the benefits of international tax treaties will require our non-U.S. subsidiaries (and non-U.S. operations) to satisfy various requirements, including those relating to ownership and/or residency. We cannot make assurances as to the extent to which we may be able to satisfy all of these requirements at all times. If any of our non-U.S. subsidiaries (or non-U.S. operations) are not eligible for international tax treaty benefits, such subsidiaries (or operations) may be subject to additional U.S. and/or international income taxation, which, in turn, would adversely impact our pro forma financial expectations for our operations.

Risks Related to Intellectual Property

Our ability to compete may decline if we do not adequately protect our intellectual property proprietary rights.

Our commercial success depends, in part, on obtaining and maintaining proprietary rights to our and our licensors’ intellectual property as well as successfully defending these rights against third party challenges. We will only be able to protect our products, product candidates, processes and technologies from unauthorized use by third parties to the extent that valid and enforceable patents, or effectively protected trade secrets, cover them. Our ability to obtain patent protection for our products, product candidates, processes and technologies is uncertain due to a number of factors, including:

we or our licensors may not have been the first to invent the technology covered by our or their pending patent applications or issued patents;
we cannot be certain that we or our licensors were the first to file patent applications covering our products, product candidates, processes or technologies, as patent applications in the United States and most other countries are confidential for a period of time after filing;
others may independently develop identical, similar or alternative products, product candidates, processes and technologies;
the disclosures in our or our licensors’ patent applications may not be sufficient to meet the statutory requirements for patentability;
any or all of our or our licensors’ pending patent applications may not result in issued patents;
we or our licensors may not seek or obtain patent protection in countries or jurisdictions that may eventually provide us a significant business opportunity;
any patents issued to us or our licensors may not provide a basis for commercially viable products, may not provide any competitive advantages, or may be successfully challenged by third parties, which may result in our or our licensors’ patent claims being narrowed, invalidated or held unenforceable;

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our products, product candidates, processes and technologies may not be patentable;
others may design around our or our licensors’ patent claims to produce competitive products, product candidates, processes and technologies that fall outside of the scope of our or our licensors’ patents; and
others may identify prior art or other bases upon which to challenge and ultimately invalidate our or our licensors’ patents or otherwise render them unenforceable.

Even if we own, obtain or in-license patents covering our products, product candidates, processes and technologies, we may still be barred from making, using and selling our products, product candidates, processes and technologies because of the patent rights or intellectual property rights of others. Others may have filed, and in the future may file, patent applications covering products, product candidates, processes or technologies that are similar or identical to ours, which could materially affect our ability to successfully develop and commercialize our products and product candidates. In addition, because patent applications can take many years to issue, there may be currently pending applications unknown to us that may later result in issued patents that our products, product candidates, processes or technologies may infringe. These patent applications may have priority over patent applications filed by us or our licensors.

Obtaining and maintaining a patent portfolio entails significant expense of resources. Part of such expense includes periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on patents and/or applications due over the course of several stages of prosecuting patent applications, and over the lifetime of maintaining and enforcing issued patents. We or our licensors may or may not choose to pursue or maintain protection for particular intellectual property in our or our licensors’ portfolio. If we or our licensors choose to forgo patent protection or to allow a patent application or patent to lapse purposefully or inadvertently, our competitive position could suffer. Furthermore, we and our licensors employ reputable law firms and other professionals to help comply with the various procedural, documentary, fee payment and other similar provisions we and they are subject to and, in many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules. There are situations, however, in which failure to make certain payments or noncompliance with certain requirements in the patent prosecution and maintenance process can result in abandonment or lapse of a patent or patent application, resulting in a partial or complete loss of patent rights in the relevant jurisdiction. In such an event, our competitors might be able to enter the market, which would have a material adverse effect on our business.

Legal action that may be required to enforce our patent rights can be expensive and may involve the diversion of significant management time. In addition, these legal actions could be unsuccessful and could also result in the invalidation of our or our licensors’ patents or a finding that they are unenforceable. We or our licensors may or may not choose to pursue litigation or other actions against those that have infringed on our or their patents, or have used them without authorization, due to the associated expense and time commitment of monitoring these activities. In some cases, the enforcement and defense of patents we in-license is controlled by the applicable licensor. If such licensor fails to actively enforce and defend such patents, any competitive advantage afforded by such patents could be materially impaired. In addition, some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we or our licensors can because of their greater financial resources and more mature and developed intellectual property portfolios. Accordingly, despite our efforts, we may not be able to prevent third parties from infringing upon or misappropriating or from successfully challenging our intellectual property rights. If we fail to protect or to enforce our intellectual property rights successfully, our competitive position could suffer, which could harm our results of operations.

In addition to patent protection, because we operate in the highly technical field of biotechnology, we rely in part on trade secret protection in order to protect our proprietary technology and processes. However, trade secrets are difficult to protect. Monitoring unauthorized uses and disclosures is difficult, and we do not know whether the steps we have taken to protect our proprietary technologies will be effective. We cannot guarantee that our trade secrets and other proprietary and confidential information will not be disclosed or that competitors will not otherwise gain access to our trade secrets. Despite these efforts, any of these parties may breach the agreements and disclose our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches. We enter into confidentiality and intellectual property assignment agreements with our employees, consultants, outside scientific collaborators, sponsored researchers and other advisors. These agreements generally require that the other party keep confidential and not disclose to third

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parties all confidential information developed by the party or made known to the party by us during the course of the party’s relationship with us. These agreements also generally provide that inventions conceived by the party in the course of rendering services to us will be our exclusive property. However, these agreements may be breached or held unenforceable and may not effectively assign intellectual property rights to us.

In addition to contractual measures, we try to protect the confidential nature of our proprietary information using physical and technological security measures. Such measures may not provide adequate protection for our proprietary information. For example, our security measures may not prevent an employee or consultant with authorized access from misappropriating our trade secrets and providing them to a competitor, and the recourse we have available against such misconduct may not provide an adequate remedy to protect our interests fully. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret can be difficult, expensive and time consuming, and the outcome is unpredictable. In addition, courts outside the United States may be less willing to protect trade secrets. Furthermore, our proprietary information may be independently developed by others in a manner that could prevent legal recourse by us. If any of our confidential or proprietary information, including our trade secrets, were to be disclosed or misappropriated, or if any such information was independently developed by a competitor, our competitive position could be harmed and our business could be materially and adversely affected.

Patents and patent applications involve highly complex legal and factual questions, which, if determined adversely to us, could negatively impact our competitive position.

The patent positions of biotechnology companies and other actors in our fields of business can be highly uncertain and typically involve complex scientific, legal and factual analyses. In particular, the interpretation and breadth of claims allowed in some patents covering biological compositions may be uncertain and difficult to determine, and are often affected materially by the facts and circumstances that pertain to the patented compositions and the related patent claims. The standards of the United States Patent and Trademark Office (the “USPTO”) and foreign patent offices are sometimes uncertain and could change in the future. Consequently, the issuance and scope of patents cannot be predicted with certainty. Patents, if issued, may be challenged, invalidated, narrowed or circumvented. U.S. patents and patent applications may also be subject to interference proceedings, and U.S. patents may be subject to reexamination proceedings, post-grant review, inter partes review, or other administrative proceedings in the USPTO. Foreign patents as well may be subject to opposition or comparable proceedings in corresponding foreign patent offices. Challenges to our or our licensors’ patents and patent applications, if successful, may result in the denial of our or our licensors’ patent applications or the loss or reduction in their scope. In addition, such interference, reexamination, post-grant review, inter partes review, opposition proceedings and other administrative proceedings may be costly and involve the diversion of significant management time. Accordingly, rights under any of our or our licensors’ patents may not provide us with sufficient protection against competitive products or processes and any loss, denial or reduction in scope of any of such patents and patent applications may have a material adverse effect on our business.

Furthermore, even if not challenged, our or our licensors’ patents and patent applications may not adequately protect our products, product candidates, processes or technologies or prevent others from designing their products or technology to avoid being covered by our or our licensors’ patent claims. If the breadth or strength of protection provided by the patents we own or license with respect to our products, product candidates, processes or technologies is threatened, it could dissuade companies from partnering with us to develop, and could threaten our ability to successfully commercialize, our products and product candidates. Furthermore, for U.S. patent applications in which claims are entitled to a priority date before March 16, 2013, an interference proceeding can be provoked by a third party or instituted by the USPTO in order to determine who was the first to invent any of the subject matter covered by such patent claims.

In addition, changes in, or different interpretations of, patent laws in the United States and other countries may permit others to use our discoveries or to develop and commercialize our technology and products without providing any notice or compensation to us, or may limit the scope of patent protection that we or our licensors are able to obtain. The laws of some countries do not protect intellectual property rights to the same extent as U.S. laws and those countries may lack adequate rules and procedures for defending our intellectual property rights.

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If we or our licensors fail to obtain and maintain patent protection and trade secret protection of our products, product candidates, processes and technologies, we could lose our competitive advantage and competition we face would increase, potentially reducing revenues and having a material adverse effect on our business.

The lives of our patents may not be sufficient to effectively protect our products and business.

Patents have a limited lifespan. Individual patent terms extend for varying periods of time, depending upon the date of filing of the patent application, the date of patent issuance, and the legal term of patents in the countries in which they are obtained. In the United States, the natural expiration of a patent is generally 20 years after its first effective filing date. Although various extensions may be available, the life of a patent, and the protection it affords, is limited. In addition, although a U.S. patent’s life can be increased based on certain delays caused by the USPTO, this increase can be reduced or eliminated based on certain delays caused by the patent applicant during patent prosecution. However, the actual protection afforded by a patent varies on a product-by-product basis, from country-to-country, and depends upon many factors, including the type of patent, the scope of its coverage, the availability of legal remedies in a particular country, and the validity and enforceability of the patent. If we or our licensors do not have sufficient patent life to protect our products, product candidates, processes and technologies, our business and results of operations will be adversely affected.

We will not seek to protect our intellectual property rights in all jurisdictions throughout the world and we may not be able to adequately enforce our intellectual property rights even in the jurisdictions where we seek protection.

Filing, prosecuting and defending patents on our products, product candidates, processes and technologies in all countries and jurisdictions throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the United States could be less extensive than those in the United States, assuming that rights are obtained in the United States. In addition, the laws of some foreign countries do not protect intellectual property rights to the same extent as federal and state laws in the United States. Consequently, we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions.

Competitors may use our technologies in jurisdictions where we or our licensors do not pursue and obtain patent protection to develop their own products and further, may export otherwise infringing products to territories where we or our licensors have patent protection, but where the ability to enforce our or our licensors’ patent rights is not as strong as in the United States. These products may compete with our products and our intellectual property rights and such rights may not be effective or sufficient to prevent such competition.

The laws of some foreign countries do not protect intellectual property rights to the same extent as the laws of the United States. Patent protection must be sought on a country-by-country basis, which is an expensive and time-consuming process with uncertain outcomes. Accordingly, we and our licensors may choose not to seek patent protection in certain countries, and we will not have the benefit of patent protection in such countries. In addition, the legal systems of some countries, particularly developing countries, do not favor the enforcement of patents and other intellectual property protection, especially those relating to biotechnologies, and the requirements for patentability differ, in varying degrees, from country to country, and the laws of some foreign countries do not protect intellectual property rights, including trade secrets, to the same extent as federal and state laws of the United States. As a result, many companies have encountered significant problems in protecting and defending intellectual property rights in certain foreign jurisdictions. Such issues may make it difficult for us to stop the infringement, misappropriation or other violation of our intellectual property rights. For example, many foreign countries, including the EU countries, have compulsory licensing laws under which a patent owner must grant licenses to third parties. In addition, many countries limit the enforceability of patents against third parties, including government agencies or government contractors. In these countries, patents may provide limited or no benefit. In those countries, we and our licensors may have limited remedies if patents are infringed or if we or our licensors are compelled to grant a license to a third party, which could materially diminish the value of those patents. This could limit our potential revenue opportunities. Accordingly, our and our licensors’ efforts to enforce intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we own or license. Similarly, if our trade secrets are disclosed in a foreign jurisdiction, competitors worldwide could have access to our proprietary information and we may be

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without satisfactory recourse. Such disclosure could have a material adverse effect on our business. Moreover, our ability to protect and enforce our intellectual property rights may be adversely affected by unforeseen changes in foreign intellectual property laws.

Furthermore, proceedings to enforce our licensors’ and our patent rights and other intellectual property rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our or our licensors’ patents at risk of being invalidated or interpreted narrowly, could put our or our licensors’ patent applications at risk of not issuing and could provoke third parties to assert claims against us or our licensors. We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded to us, if any, may not be commercially meaningful, while the damages and other remedies we may be ordered to pay such third parties may be significant. Accordingly, our licensors’ and our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license.

Third parties may assert rights to inventions we develop or otherwise regard as our own.

Third parties may in the future make claims challenging the inventorship or ownership of our or our licensors’ intellectual property. We have written agreements with research and development partners that provide for the ownership of intellectual property arising from our strategic alliances. These agreements provide that we must negotiate certain commercial rights with such partners with respect to joint inventions or inventions made by our partners that arise from the results of the strategic alliance. In some instances, there may not be adequate written provisions to address clearly the allocation of intellectual property rights that may arise from the respective alliance. If we cannot successfully negotiate sufficient ownership and commercial rights to the inventions that result from our use of a third-party partner’s materials when required, or if disputes otherwise arise with respect to the intellectual property developed through the use of a partner’s samples, we may be limited in our ability to capitalize on the full market potential of these inventions. In addition, we may face claims by third parties that our agreements with employees, contractors or consultants obligating them to assign intellectual property to us are ineffective, or are in conflict with prior or competing contractual obligations of assignment, which could result in ownership disputes regarding intellectual property we have developed or will develop and could interfere with our ability to capture the full commercial value of such inventions. Litigation may be necessary to resolve an ownership dispute, and if we are not successful, we may be precluded from using certain intellectual property and associated products, processes and technologies, or may lose our rights in that intellectual property. Either outcome could have a material adverse effect on our business.

We may not identify relevant third party patents or may incorrectly interpret the relevance, scope or expiration of a third party patent which might adversely affect our ability to develop and market our products or product candidates.

We cannot guarantee that any of our patent searches or analyses, including but not limited to the identification of relevant patents, the scope of patent claims or the expiration of relevant patents, are complete or thorough, nor can we be certain that we have identified each and every third party patent and pending application in the United States and abroad that is relevant to or necessary for the commercialization of our products or product candidates in any jurisdiction.

The scope of a patent claim is determined by an interpretation of the law, the written disclosure in a patent and the patent’s prosecution history. Our interpretation of the relevance or the scope of a patent or a pending application may be incorrect, which may negatively impact our ability to market our products. We may incorrectly determine that our products are not covered by a third party patent or may incorrectly predict whether a third party’s pending application will issue with claims of relevant scope. Our determination of the expiration date of any patent in the United States or abroad that we consider relevant may be incorrect, which may negatively impact our ability to develop and market our products or product candidates. Our failure to identify and correctly interpret relevant patents may negatively impact our ability to develop and market our products or product candidates.

Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets.

We currently employ, and in the future may employ, individuals who were previously employed at universities or other biotechnology companies, including our competitors or potential competitors. Although we try to ensure that our employees and consultants do not use the proprietary information or know-how of others in

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their work for us, we may be subject to claims that we or our employees, consultants or independent contractors have inadvertently or otherwise used or disclosed intellectual property, including trade secrets or other proprietary information, of a former employer or other third parties. Litigation may be necessary to defend against these claims. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel or damage our reputation. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees.

Any infringement, misappropriation or other violation by us of intellectual property rights of others may prevent or delay our product development efforts and may prevent or increase the costs of our successfully commercializing our products or product candidates, if approved.

The biotechnology industry is characterized by extensive litigation regarding patents and other intellectual property rights. Our success will depend in part on our ability to operate without infringing, misappropriating or otherwise violating the intellectual property and proprietary rights of third parties. We cannot assure you that our business operations, products, product candidates and methods and the business operations, products, product candidates and methods of our partners do not or will not infringe, misappropriate or otherwise violate the patents or other intellectual property rights of third parties. We may, from time to time, utilize techniques or compounds for which we have determined a license is not required. For example, in some cases, we use DNA-breaking reagents, such as CRISPR-Cas9, to make site-specific cuts in the DNA of a plant cell. In cases where we have determined a license is not required, other parties may allege that the use of such techniques or compounds infringes, misappropriates or otherwise violates patent claims or other intellectual property rights held by them or that we are employing their proprietary technology without authorization.

Other parties may allege that our products, product candidates, processes or technologies infringe, misappropriate or otherwise violate patent claims or other intellectual property rights held by them or that we are employing their proprietary technology without authorization. Patent and other types of intellectual property litigation can involve complex factual and legal questions, and their outcome is uncertain. Any claim relating to intellectual property infringement that is successfully asserted against us may require us to pay substantial damages, including treble damages and attorneys’ fees if we or our partners are found to be willfully infringing another party’s patents, for past use of the asserted intellectual property and royalties and other consideration going forward if we are forced to take a license. Such a license may not be available on commercially reasonable terms, or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors access to the same intellectual property rights or technologies licensed to us. In addition, if any such claim were successfully asserted against us and we could not obtain a license, we or our partners may be forced to stop or delay developing, manufacturing, selling or otherwise commercializing our products, product candidates or other infringing technology, or those we develop with our research and development partners.

Even if we are successful in these proceedings, we may incur substantial costs and divert management time and attention pursuing these proceedings, which could have a material adverse effect on us. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our Class A common shares. Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. If we are unable to avoid infringing the patent rights of others, we may be required to seek a license, defend an infringement action or challenge the validity of the patents in court, or redesign our products. Patent litigation is costly and time consuming. We may not have sufficient resources to bring these actions to a successful conclusion. In addition, intellectual property litigation or claims could force us to do one or more of the following:

cease developing, selling or otherwise commercializing our products or product candidates;
pay substantial damages for past use of the asserted intellectual property;
obtain a license from the holder of the asserted intellectual property, which license may not be available on reasonable terms, if at all; and

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in the case of trademark claims, redesign, or rename trademarks we may own, to avoid infringing the intellectual property rights of third parties, which may not be possible and, even if possible, could be costly and time-consuming.

Any of these risks coming to fruition could have a material adverse effect on our business, results of operations, financial condition and prospects.

We may be unsuccessful in licensing or acquiring intellectual property from third parties that may be required to develop and commercialize our products or product candidates.

Because our programs may involve the use of intellectual property or proprietary rights held by third parties, the growth of our business will likely depend in part on our ability to acquire, in-license or use these intellectual property and proprietary rights. For example, if we determined to use a technology to perform our gene editing, we may need one or more licenses to use that technology. However, we may be unable to acquire or in-license any third-party intellectual property or proprietary rights. Even if we are able to acquire or in-license such rights, we may be unable to do so on commercially reasonable terms. The licensing and acquisition of third party intellectual property and proprietary rights is a competitive area, and a number of more established companies are also pursuing strategies to license or acquire third party intellectual property and proprietary rights that we may consider attractive or necessary. These established companies may have a competitive advantage over us due to their size, capital resources and agricultural development and commercialization capabilities.

We sometimes partner with academic institutions to accelerate our research and development under written agreements with these institutions. Typically, these institutions provide us with an option to negotiate a license to any of the institution’s rights in technology resulting from the strategic alliance. Regardless of such option, we may be unable to negotiate a license within the specified time frame or under terms that are acceptable to us, and the institution may license such intellectual property rights to third parties, potentially blocking our ability to pursue our development and commercialization plans.

In addition, companies that perceive us to be a competitor may be unwilling to assign or license intellectual property and proprietary rights to us. We also may be unable to license or acquire third party intellectual property and proprietary rights on terms that would allow us to make an appropriate return on our investment or at all. If we are unable to successfully acquire or in-license rights to required third party intellectual property and proprietary rights or maintain the existing intellectual property and proprietary rights we have, we may have to cease development of the relevant program, product or product candidate, which could have a material adverse effect on our business.

If we fail to comply with our obligations in the agreements under which we license intellectual property rights from third parties or otherwise experience disruptions to our business relationships with our licensors, we could lose license rights that are important to our business.

We are a party to a number of intellectual property license agreements that are important to our business and expect to enter into additional license agreements in the future. Our existing license agreements impose, and we expect that future license agreements will impose, various diligence, royalty and other obligations on us. If we fail to comply with our obligations under these agreements, or we are subject to a bankruptcy, our licensors may have the right to terminate the license, in which event we would not be able to market products or product candidates covered by the license.

In addition, disputes may arise regarding the payment of the royalties or other considerations due to licensors in connection with our exploitation of the rights we license from them. Licensors may contest the basis of payments we retained and claim that we are obligated to make payments under a broader basis. In addition to the costs of any litigation we may face as a result, any legal action against us could increase our payment obligations under the respective agreement and require us to pay interest and potentially damages to such licensors.

In some cases, patent prosecution of our licensed technology is controlled solely by the licensor. If such licensor fails to obtain and maintain patent or other protection for the proprietary intellectual property we license from such licensor, we could lose our rights to such intellectual property or the exclusivity of such rights, and our competitors could market competing products using such intellectual property. In addition, these patents and applications may not be prosecuted and enforced in a manner consistent with the best interests of our business.

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In that event, we may be required to expend significant time and resources to develop or license replacement technology. If we are unable to do so, we may be unable to develop or commercialize the affected products and product candidates, which could harm our business significantly. In other cases, we control the prosecution of patents resulting from licensed technology. In the event we breach any of our obligations related to such prosecution, we may incur significant liability to our licensing partners. We may also require the cooperation of our licensors to enforce any licensed patent rights, and such cooperation may not be provided. Moreover, we have obligations under these license agreements, and any failure to satisfy those obligations could give our licensor the right to terminate the agreement. Termination of a necessary license agreement could have a material adverse impact on our business.

Licensing of intellectual property is of critical importance to our business and involves complex legal, business and scientific issues and is complicated by the rapid pace of scientific discovery in our industry. Disputes may arise regarding intellectual property subject to a licensing agreement, including:

the scope of rights granted under the license agreement and other interpretation-related issues;
the basis of royalties and other consideration due to our licensors;
the extent to which our products, product candidates, technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement;
the sublicensing of patent and other rights under our development relationships;
our diligence obligations under the license agreement and what activities satisfy those diligence obligations;
the ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and us and our partners; and
the priority of invention of patented technology.

If disputes over intellectual property that we have licensed from third parties prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize the affected products or product candidates, which could have a material adverse effect on our business.

Some of the licenses we may grant to our licensing partners to use our proprietary genes in certain crops may be exclusive within certain jurisdictions, which could limit our licensing opportunities.

Some of the licenses we may grant our licensing partners to use our proprietary traits in certain crops may be exclusive within specified jurisdictions, so long as our licensing partners comply with certain diligence requirements. That means that once traits are licensed to a licensing partner in a specified crop or crops, we may be generally prohibited from licensing those traits to any third party. The limitations imposed by such exclusive licenses could prevent us from expanding our business and increasing our product development initiatives with new licensing partners, both of which could adversely affect our business and results of operations.

Our results of operations will be affected by the level of royalty payments that we are required to pay to third parties.

We are, or may become, party to agreements, including licensing agreements and our Warrant Exchange Agreement (as defined herein), that require us to remit royalty payments and other payments related to our owned or licensed intellectual property.

Under our in-license agreements, we may pay up-front fees and milestone payments and be subject to future royalties. We cannot precisely predict the amount, if any, of royalties we will owe in the future, and if our calculations of royalty payments are incorrect, we may owe additional royalties, which could negatively affect our results of operations. As our product sales increase, we may, from time to time, disagree with our third-party collaborators as to the appropriate royalties owed and the resolution of such disputes may be costly and may consume management’s time. Furthermore, we may enter into additional license agreements in the future, which may also include royalty, milestone and other payments.

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If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected.

Our trademarks or trade names may be challenged, infringed, circumvented or declared generic or determined to be infringing on other marks. We may not be able to protect our rights to these trademarks and trade names or may be forced to stop using these names and trademarks, which we need for name recognition by potential partners or farmers or processors in our markets of interest. If we are unable to establish name recognition based on our trademarks and trade names, we may not be able to compete effectively and our business may be adversely affected.

Risks Related to Our Organization and Operation

We will need to develop and expand our company, and we may encounter difficulties in managing this development and expansion, which could disrupt our operations.

As of October 31, 2018, we had 134 full-time employees and we expect to increase our number of employees and the scope and location of our operations. To manage our anticipated development and expansion, including the development and the commercialization of our products and licensing of our product candidates, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities and continue to recruit and train additional qualified personnel. Members of our management team may need to divert a disproportionate amount of their attention away from their day-to-day activities and devote a substantial amount of time to managing these development activities. Due to our limited resources, we may not be able to effectively manage the expansion of our operations or recruit and train additional qualified personnel. This may result in weaknesses in our infrastructure, give rise to operational mistakes, loss of business opportunities, loss of employees and reduced productivity among remaining employees. The physical expansion of our operations may lead to significant costs and may divert financial resources from other projects, such as the development of our product candidates. If our management is unable to effectively manage our expected development and expansion, our expenses may increase more than expected, our ability to generate or increase our revenue could be reduced and we may not be able to implement our business strategy. Our future financial performance and our ability to commercialize our products and product candidates and compete effectively will depend, in part, on our ability to effectively manage the future development and expansion of our company.

We depend on key management personnel and attracting and retaining other qualified personnel, and our business could be harmed if we lose key management personnel or cannot attract and retain other qualified personnel.

Our success depends to a significant degree upon the technical skills and continued service of certain members of our management team, particularly Peter Beetham, Ph.D., our President and Chief Executive Officer, and Greg Gocal, Ph.D., our Chief Scientific Officer. The loss of the services of one or both of these key executive officers could have a material adverse effect on us. We do not maintain “key man” insurance policies on the lives of any of our employees.

Our success will also depend upon our ability to attract and retain additional qualified management, regulatory, technical, and sales and marketing executives and personnel. The failure to attract, integrate, motivate, and retain additional skilled and qualified personnel could have a material adverse effect on our business. We compete for such personnel against numerous companies, including larger, more established companies with significantly greater financial resources than we possess. In addition, failure to succeed in our product candidates’ development may make it more challenging to recruit and retain qualified personnel. There can be no assurance that we will be successful in attracting or retaining such personnel and the failure to do so could have a material adverse effect on our business, financial condition and results of operations.

Our internal computer systems, or those of our third-party contractors or consultants, may fail or suffer security breaches, which could result in a material disruption of our operations.

Despite the implementation of security measures, our internal computer systems, and those of third parties on which we rely, are vulnerable to damage from computer viruses, malware, natural disasters, terrorism, war, telecommunication and electrical failures, cyber-attacks or cyber-intrusions over the Internet, attachments to emails, persons inside our organization, or persons with access to systems inside our organization. While we do not believe that we have experienced any such system failure, accident, or security breach to date, if such an

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event were to occur and cause interruptions in our systems, it could result in a material disruption of our operations. For example, the loss of field trial data for our product candidates could result in delays in our commercialization efforts and significantly increase our costs to recover or reproduce the data. Additionally, there have been reported cases in the industry where product candidates have been stolen from the field during field trials. To the extent that any disruption or security breach results in a loss of or damage to our data or applications or other data or applications relating to our technology or product candidates, or inappropriate disclosure of confidential or proprietary information, we could incur liabilities, damage to our reputation, and the further development of our product candidates could be delayed.

We are a Bermuda company and it may be difficult for you to enforce judgments against us or our directors and executive officers.

We are incorporated in Bermuda as an exempted company limited by shares. As a result, the rights of our shareholders will be governed by Bermuda law and our Memorandum of Association and Amended and Restated Bye-Laws (the “Bye-Laws”). The rights of shareholders under Bermuda law may differ from the rights of shareholders of companies incorporated in another jurisdiction. It may be difficult for investors to enforce in the United States judgments obtained in U.S. courts against us based on the civil liability provisions of the U.S. securities laws. It is doubtful whether courts in Bermuda will enforce judgments obtained in other jurisdictions, including the United States, against us or our directors or officers under the securities laws of those jurisdictions or entertain actions in Bermuda against us or our directors or officers under the securities laws of other jurisdictions. See “Enforcement of Civil Liabilities under U.S. Federal Securities Laws” for additional information.

Bermuda law differs from the laws in effect in the United States and may afford less protection to our shareholders.

We are organized under the laws of Bermuda. As a result, our corporate affairs are governed by the Bermuda Companies Act 1981 (the “Companies Act”), which differs in some material respects from laws typically applicable to U.S. corporations and shareholders, including the provisions relating to interested directors, amalgamations, mergers and acquisitions, takeovers, shareholder lawsuits and indemnification of directors. Generally, the duties of directors and officers of a Bermuda company are owed to the company only. Shareholders of Bermuda companies typically do not have rights to take action against directors or officers of the company and may only do so in limited circumstances. Shareholder class actions are not available under Bermuda law. The circumstances in which shareholder derivative actions may be available under Bermuda law are substantially more proscribed and less clear than they would be to shareholders of U.S. corporations. The Bermuda courts, however, would ordinarily be expected to permit a shareholder to commence an action in the name of a company to remedy a wrong to the company where the act complained of is alleged to be beyond the corporate power of the company or illegal, or would result in the violation of the company’s Memorandum of Association or Bye-Laws. Furthermore, consideration would be given by a Bermuda court to acts that are alleged to constitute a fraud against the minority shareholders or, for instance, where an act requires the approval of a greater percentage of the company’s shareholders than those who actually approved it.

When the affairs of a company are being conducted in a manner that is oppressive or prejudicial to the interests of some shareholders, one or more shareholders may apply to the Supreme Court of Bermuda, which may make such order as it sees fit, including an order regulating the conduct of the company’s affairs in the future or ordering the purchase of the shares of any shareholders by other shareholders or by the company. Additionally, under our Bye-Laws and as permitted by Bermuda law, each shareholder has waived any claim or right of action against our directors or officers for any action taken by directors or officers in the performance of their duties, except for actions involving fraud or dishonesty. In addition, the rights of our shareholders and the fiduciary responsibilities of our directors under Bermuda law are not as clearly established as under statutes or judicial precedent in existence in jurisdictions in the United States, particularly the State of Delaware. Therefore, our shareholders may have more difficulty protecting their interests than would shareholders of a corporation incorporated in a jurisdiction within the United States.

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Risks Related to Our Organizational Structure

Our management will have broad discretion over the use of the proceeds from this offering and may not apply the proceeds of this offering in ways that increase the value of your investment.

Our management will have broad discretion to use the net proceeds we receive from this offering and you will be relying on its judgment regarding the application of these proceeds. We expect to use the net proceeds from this offering as described under the heading “Use of Proceeds.” However, management may not apply the net proceeds of this offering in ways that increase the value of your investment.

U.S. “anti-inversion” tax laws could negatively affect our results or could result in certain adverse U.S. tax consequences.

Under rules contained in U.S. tax law (generally referred to as the “anti-inversion” tax rules), Cibus Ltd. would be subject to tax as a U.S. corporation in the event that Cibus Ltd. were to acquire substantially all of the assets of a U.S. corporation or a U.S. partnership, and the equity owners of that U.S. corporation or U.S. partnership own at least 80% of our stock by reason of holding stock in the U.S. corporation or U.S. partnership (such ownership calculated without regard to any stock issued in a related public offering). In addition, these anti-inversion tax rules provide that if Cibus Ltd. were to directly or indirectly acquire all or substantially all of the properties of a U.S. corporation or a U.S. partnership, and the equity owners of that U.S. corporation or U.S. partnership own at least 60% (but less than 80%) of our stock by reason of holding stock in the U.S. corporation or U.S. partnership (again, such ownership calculated without regard to any stock issued in a related public offering), then Cibus Ltd. would not be subject to tax as a U.S. corporation, but instead certain adverse U.S. tax consequences could apply (for example, dividends distributed by Cibus Ltd. would not be considered to be “qualified dividend income” and thus may be subject to higher rates of U.S. tax than otherwise would be the case). As noted, Cibus Ltd. will acquire all of the stock (and thus, indirectly, will acquire all of the assets) of each of the Blockers (each of which is a U.S. corporation) from the shareholders of such Blockers, and in exchange therefor, the Blocker shareholders will each be issued Class A common shares. However, we believe that the resulting ownership of the Blocker shareholders of our Class A common shares will be below the 60% standard for application of the anti-inversion rules (even when taking into account the requirement of these rules that stock issued in this offering be ignored for this purpose). Accordingly, we do not believe that these rules should apply. We note, however, that the interpretation of certain of the provisions of these anti-inversion tax rules are uncertain in many respects, in particular, with respect to their treatment of entities which are classified for U.S. tax purposes as partnerships, and therefore, we cannot offer assurances as to the manner in which these provisions may apply to Cibus Ltd. In addition, even if we meet the less than 60% ownership thresholds described above, the provisions of Section 7874 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), provide the IRS with broad regulatory authority to provide such regulations as may be appropriate to determine whether a non-U.S. corporation should be treated as a U.S. corporation for U.S. federal tax purposes pursuant to these rules, and/or to otherwise carry out the general purposes of the provisions. The Internal Revenue Service (the “IRS”) may issue regulations which would apply to Cibus Ltd. In the event that Cibus Ltd. were required to be treated as a U.S. corporation pursuant to these anti-inversion tax rules, the U.S. federal tax consequences to holders of our Class A common shares would be materially different, and potentially materially more adverse, to such holders than otherwise would be the case.

Challenges to the U.S. tax status of Cibus Global could adversely impact our financial results.

As noted, Cibus Ltd. is structured as a holding company, and substantially all of its assets will consist (directly or indirectly through one or more wholly-owned subsidiaries of Cibus Ltd.) of Equity Interests in Cibus Global. Cibus Global is classified as a “partnership” for U.S. federal and applicable U.S. state and local tax purposes, and we intend that such classification of Cibus Global continue. Certain rules in the U.S. tax law however (referred to as the “publicly traded partnership” rules) mandate that any entity which is otherwise classified for U.S. tax purposes as a partnership shall be required to instead be classified for such purposes as a corporation if interests in that entity are traded on an established securities market or are readily tradeable on a secondary market (or substantial equivalent thereof). Although interests in Cibus Global will not be traded on any securities market, the fact that such interests are exchangeable or redeemable for interests in Cibus Ltd. (which interests are so traded), may cause these rules to require Cibus Global to be classified as a corporation (rather than a partnership) for U.S. tax purposes. Nonetheless, the regulations promulgated pursuant to these publicly traded partnership rules provide certain “safe harbors” which, if complied with, would allow Cibus Global to

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continue to be classified as a partnership for U.S. tax purposes notwithstanding these rules. One such safe harbor applies if (among other requirements) Cibus Global were to, at all times, have less than 100 shareholders. Another such safe harbor would apply if certain significant limitations are placed on the ability of Cibus Global shareholders to exchange or redeem their shares. We intend to operate in a manner which, at all times, complies with one or more of these safe harbors, and thus, we expect that Cibus Global will continue to be classified as a partnership for U.S. tax purposes. However, we cannot give any assurances that we will at all times be successful in complying with these safe harbors (for example, we may not, despite our efforts, be able to at all times control or limit the number of stockholders of Cibus Global). If at any time Cibus Global is required to be treated as a corporation rather than a partnership for U.S. tax purposes, adverse tax consequences would apply to our company, which, in turn, would have an adverse impact on our operating results.

U.S. tax authorities could treat Cibus Ltd. as a “passive foreign investment company,” which could have adverse U.S. federal income tax consequences to U.S. holders.

An entity (such as Cibus Ltd.) which is classified for U.S. federal tax purposes as a foreign corporation will be treated for such purposes as a “passive foreign investment company” (a “PFIC”) if either (1) at least 75% of its gross income for any taxable year consists of certain types of “passive income” or (2) at least 50% of the average value of the corporation’s assets for any taxable year produce or are held for the production of those types of “passive income.” For purposes of these tests, “passive income” generally includes dividends, interest, and gains from the sale or exchange of certain investment property and rents and royalties other than certain rents and royalties which are received from unrelated parties in connection with the active conduct of a trade or business, but does not include income derived from the performance of services. U.S. shareholders of a PFIC are subject to a disadvantageous U.S. federal income tax regime with respect to the income derived by the PFIC, the distributions they receive from the PFIC, and the gain, if any, they derive from the sale or other disposition of their interests in the PFIC.

We believe that we will not be a PFIC for the current taxable year or for any future taxable year. However, this involves a facts and circumstances analysis and it is possible that the facts and circumstances upon which we base this belief may change in the future and/or that the IRS would not agree with our conclusion, or the U.S. tax laws could change significantly. See “Material U.S. Tax Considerations—PFIC Status.”

We are a holding company. Our sole material asset after completion of this offering will be the Equity Interests we hold, directly and indirectly, in Cibus Global and we will be accordingly dependent upon distributions from Cibus Global to pay taxes and cover our corporate and other overhead expenses.

We are a holding company and will have no material assets other than the Equity Interests we hold, directly and indirectly, in Cibus Global. As such, we have no independent means of generating revenue or cash flow, and our ability to pay our taxes and operating expenses or declare and pay dividends in the future, if any, will be dependent upon the financial results and cash flows of Cibus Global and its subsidiaries and distributions we received from Cibus Global. To the extent that Cibus Global has available cash, we intend to cause Cibus Global to make (i) tax distributions to the Continuing Cibus Global Equity Owners in accordance with the terms of the Cibus Global Association Documents, and (ii) non-pro rata distributions to us in an amount to cover our operating expenses. There can be no assurances that Cibus Global and its subsidiaries will generate sufficient cash flow to distribute funds to us. To the extent that we need funds and Cibus Global or its subsidiaries are restricted from making such distributions under applicable law or regulation or are otherwise unable to provide such funds, our liquidity and financial conditions could be adversely affected. If we do not have sufficient funds to pay tax or other liabilities or to fund our operations, we may have to borrow funds, which could materially adversely affect our liquidity and financial condition and subject us to various restrictions imposed by such lenders.

In certain circumstances, Cibus Global will be required to make distributions to us and the other holders of Equity Interests, and the distributions that Cibus Global will be required to make may be substantial.

Under the Cibus Global Association Documents, Cibus Global will generally be required from time to time to make pro rata distributions in cash to us and the other holders of Equity Interests in amounts that are intended to be sufficient to cover the taxes on our and the other Equity Interest holders’ respective allocable shares of the taxable income of Cibus Global. As a result of (i) potential differences in the amount of net taxable income allocable to us and the other Equity Interest holders, (ii) the lower tax rate applicable to corporations than

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individuals and (iii) the favorable tax benefits that we anticipate receiving from acquisitions of Equity Interests in Cibus Global in connection with future taxable redemptions of Equity Interests for our Class A common shares, we expect that these tax distributions will be in amounts that exceed our tax liabilities. Our Board of Directors will determine the appropriate uses for any excess cash so accumulated, which may include, among other uses, dividends and the payment of other expenses. We will have no obligation to distribute such cash (or other available cash other than any declared dividend) to our shareholders. No adjustments to the redemption ratio of Equity Interests for Class A common shares will be made as a result of either (i) any cash distribution by us or (ii) any cash that we retain and do not distribute to our shareholders. To the extent that we do not distribute such excess cash as dividends on our Class A common shares and instead, for example, hold such cash balances or lend them to Cibus Global, the Original Cibus Global Equity Owners would benefit from any value attributable to such cash balances as a result of their ownership of Class A common shares following a redemption of their Equity Interests. See “Certain Relationships and Related Party Transactions—Amended and Restated Cibus Global Memorandum of Association and Articles of Association.”

The Reorganization Transactions may adversely affect our relationship with certain employees.

Our performance is largely dependent on the efforts and motivation of our employees. Historically, Cibus Global has attempted to motivate its employees and align the interests of its employees with its own interests through the issuance of restricted shares in Cibus Global. In connection with the Reorganization Transactions, Cibus Global will purchase all Equity Interests held by its employees who are not accredited investors (other than any such employee who is an Exchanging Non-Accredited Owner or is a 2021 Plan Participant). See “Our Structure and Reorganization.” The repurchase of these Equity Interests may negatively impact our ability to properly motivate such employees following the offering. Furthermore, any form of equity compensation which we may issue to such employees in the future may not be as effective as the status as, or opportunity to become, a member in Cibus Global.

Risks Related to Ownership of Our Class A Common Shares

Being a U.S. public company requires significant resources and management attention and may affect our ability to attract and retain executive management and qualified Board members.

As a U.S. public company following this offering, we will incur legal, accounting and other expenses that we did not previously incur. We will be subject to the Securities Exchange Act of 1934 (the “Exchange Act”), including the reporting requirements thereunder, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Nasdaq listing requirements and other applicable securities rules and regulations. Compliance with these rules and regulations will increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources, particularly after we are no longer an emerging growth company.

Pursuant to Section 404 of the Sarbanes-Oxley Act, we will be required to furnish a report by our management on our internal control over financial reporting, including an attestation report on internal control over financial reporting issued by our independent registered public accounting firm. However, while we remain an emerging growth company, we will not be required to include this attestation report on internal control over financial reporting issued by our independent registered public accounting firm. When our independent registered public accounting firm is required to undertake an assessment of our internal control over financial reporting, the cost of complying with Section 404 will significantly increase and management’s attention may be diverted from other business concerns, which could adversely affect our business and results of operations. We may need to hire more employees in the future or engage outside consultants to comply with these requirements, which will further increase our costs and expenses. If we fail to implement the requirements of Section 404 in the required timeframe, we may be subject to sanctions or investigations by regulatory authorities, including the Securities and Exchange Commission (the “SEC”) and the Nasdaq. Furthermore, if we are unable to conclude that our internal control over financial reporting is effective, we could lose investor confidence in the accuracy and completeness of our financial reports, the market price of our Class A common shares could decline, and we could be subject to sanctions or investigations by regulatory authorities. Failure to implement or maintain effective internal control systems required of public companies could also restrict our future access to the capital markets. In addition, enhanced legal and regulatory regimes and heightened standards relating to corporate governance and disclosure for public companies result in increased legal and financial compliance costs and make some activities more time consuming.

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An active trading market for our Class A common shares may not develop, and the market price for our Class A common shares may be volatile or may decline regardless of our operating performance.

Prior to the completion of this offering, there has been no public market for our Class A common shares. An active trading market for our Class A common shares may never develop or be sustained following this offering. If an active trading market does not develop, you may have difficulty selling your Class A common shares at an attractive price, or at all. The price for our Class A common shares in this offering will be determined by negotiations among us and representatives of the underwriters, and it may not be indicative of prices that will prevail in the open market following this offering. Consequently, you may not be able to sell your Class A common shares at or above the initial public offering price or at any other price or at the time that you would like to sell. An inactive market may also impair our ability to raise capital by selling our Class A common shares, and it may impair our ability to attract and motivate our employees through equity incentive awards and our ability to acquire other companies, products or technologies by using our Class A common shares as consideration.

The price of our Class A common shares may fluctuate substantially.

You should consider an investment in our Class A common shares to be risky, and you should invest in our Class A common shares only if you can withstand a significant loss and wide fluctuations in the market value of your investment. Some factors that may cause the market price of our Class A common shares to fluctuate, in addition to the other risks mentioned in this section of the prospectus, are:

actual or anticipated fluctuations in our financial condition and operating results;
our failure to develop and commercialize our product candidates;
fluctuations in the liability balance of our Royalty Obligation due to changes in our business model and anticipated revenues from product candidates in development;
actual or anticipated changes in our growth rate relative to our competitors;
competition from existing products or new products that may emerge;
announcements by us, our research and development partners or our competitors of significant acquisitions, strategic partnerships, joint ventures, strategic alliances or capital commitments;
the imposition of regulatory requirements on any of our products or product candidates;
the inability to establish additional strategic alliances;
unanticipated serious safety concerns related to the use of any of our products once commercialized;
failure to meet or exceed financial estimates and projections of the investment community or that we provide to the public;
issuance of new or updated research or reports by securities analysts;
fluctuations in the valuation of companies perceived by investors to be comparable to us;
inconsistent trading volume levels of our Class A common shares;
additions or departures of key management or scientific personnel;
disputes or other developments related to proprietary rights, including patents, litigation matters, and our ability to obtain patent protection for our technologies;
announcement or expectation of additional equity or debt financing efforts;
sales of Class A common shares by us, our insiders or our other shareholders; and
general economic and market conditions.

These and other market and industry factors may cause the market price and demand for our Class A common shares to fluctuate substantially, regardless of our actual operating performance, which may limit or prevent investors from readily selling their Class A common shares and may otherwise negatively affect the

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liquidity of our Class A common shares. In addition, the stock market in general, and biotechnology companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies.

If you purchase Class A common shares in this offering, you will experience substantial and immediate dilution.

If you purchase Class A common shares in this offering, you will experience substantial and immediate dilution of $          per share in the net tangible book value after giving effect to the offering at an assumed initial public offering price of $          per share (the midpoint of the price range on the cover of this prospectus) because the price that you pay will be substantially greater than the net tangible book value per share that you acquire. For a further description of the dilution that you will experience immediately after this offering, see the section of this prospectus titled “Dilution.”

Sales of our Class A common shares into the market in the future, or the perception that these sales may occur, could cause the market price of our Class A common shares to drop significantly.

Holders of Cibus Global Equity Interests (other than Cibus Ltd.) may receive Class A common shares pursuant to the exercise of an exchange right and then sell those Class A common shares. Further, we may issue additional Class A common shares or convertible securities in subsequent public offerings or as consideration for future acquisitions. After the completion of this offering, we will have issued          Class A common shares. This number includes          Class A common shares that we are selling in this offering and          Class A common shares that we may sell in this offering if the underwriters’ option to purchase additional shares is fully exercised, which may be resold immediately in the public market. Following the completion of this offering, the Former Cibus Global Equity Owners and the Blocker Owners will own             Class A common shares, representing approximately          % (or          % if the underwriters’ option to purchase additional shares is exercised in full) of our total issued common shares. All such shares are restricted from immediate resale under the federal securities laws but may be sold into the market in the future. We expect that the Blocker Owners and the Former Cibus Global Equity Owners will be party to a Registration Rights Agreement with us that will require us to effect the registration of their Class A common shares in certain circumstances. All of our officers and directors and substantially all holders of our outstanding shares will be subject to certain restrictions on the sale of their Class A common shares for 180 days after the date of this prospectus; however, after such period, and subject to compliance with the Securities Act or exemptions therefrom, these employees may sell such shares into the public market. Please read “Shares Eligible for Future Sale” and “Certain Relationships and Related Party Transactions—Registration Rights Agreement.”

In connection with this offering, we intend to file a registration statement with the SEC on Form S-8 providing for the registration of          Class A common shares issued or reserved for issuance under our 2018 Incentive Compensation Plan. Subject to the satisfaction of vesting conditions and the expiration of lock-up periods, shares registered under the registration statement on Form S-8 will be available for resale immediately in the public market without restriction.

We cannot predict the size of future issuances of our Class A common shares or securities convertible into Class A common shares or the effect, if any, that future issuances and sales of Class A common shares will have on the market price of our Class A common shares. Sales of substantial amounts of our Class A common shares (including shares issued in connection with an acquisition), or the perception that such sales could occur, may adversely affect prevailing market prices of our Class A common shares.

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, the price of our Class A common shares and trading volume could decline.

The trading market for our Class A common shares depends in part on the research and reports that securities or industry analysts publish about us or our business. If few or no securities or industry analysts cover us, the trading price for our Class A common shares would be negatively impacted. If one or more of the analysts who cover us downgrades our Class A common shares or publishes incorrect or unfavorable research about our business, the price of our Class A common shares would likely decline. If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, or downgrades our Class A common shares, demand for our Class A common shares could decrease, which could cause the price of our Class A common shares or trading volume to decline.

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We do not currently intend to pay dividends on our Class A common shares.

We do not intend to pay any dividends to holders of our Class A common shares for the foreseeable future. We currently intend to invest our future earnings, if any, to fund our growth. Therefore, you are not likely to receive any dividends on your Class A common shares for the foreseeable future, and the success of an investment in our Class A common shares will depend upon any future appreciation in its value. Consequently, investors may need to sell all or part of their holdings of our Class A common shares after price appreciation, which may never occur, as the only way to realize any future gains on their investment. There is no guarantee that our Class A common shares will appreciate in value or even maintain the price at which our shareholders have purchased our Class A common shares. Investors seeking cash dividends should not purchase our Class A common shares.

Provisions in our Memorandum of Association and Bye-Laws may prevent or delay an acquisition of us, which could decrease the trading price of our Class A common shares.

Our Memorandum of Association and Bye-Laws will contain provisions that are intended to deter coercive takeover practices and inadequate takeover bids and to encourage prospective acquirers to negotiate with our Board of Directors rather than to attempt a hostile takeover. These include the following provisions:

a Board of Directors that is divided into three classes with staggered terms;
rules regarding how our shareholders may present proposals or nominate directors for election at shareholder meetings;
662/3% Board approval requirement for a change of control, subject to expire after 10 years;
the right of our Board of Directors to issue preferred shares without shareholder approval; and
limitations on the right of shareholders to remove directors.

These provisions could make it more difficult for a third party to acquire us, even if the third party’s offer may be considered beneficial by many shareholders. As a result, shareholders may be limited in their ability to obtain a premium for their shares. See “Description of Share Capital” for a discussion of these provisions.

We are an emerging growth company, and a smaller reporting company and we cannot be certain if the reduced disclosure requirements applicable to us will make our Class A common shares less attractive to investors.

We are an “emerging growth company,” as defined in the JOBS Act, and a “smaller reporting company,” as defined in Rule 405 under the Securities Act. As an emerging growth company, we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies,” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, and reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. Similarly, as a smaller reporting company, we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “smaller reporting companies,” including, but not limited to, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements.

We cannot predict if investors will find our Class A common shares less attractive if we rely on these exemptions. If some investors find our Class A common shares less attractive as a result, there may be a less active trading market for our Class A common shares and our share price may be more volatile.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INDUSTRY DATA

We have made statements under the captions “Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business” and in other sections of this prospectus that are “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements.

There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including, without limitation, factors relating to:

our limited operating history;
our reliance on contractual counterparties;
significant competition from competitors with substantially greater resources than us;
public perceptions of products of biotechnology and ethical, legal, environmental, health and social concerns;
uncertain and evolving regulatory requirements;
the state of, and variations in, regulatory environments outside the United States;
government policies and regulations affecting the agricultural sector and related industries;
commodity price and other market risks facing the agricultural sector;
the time and resources required for product development that relies upon a complex integrated technology platform;
our reliance on gene-editing technologies that may become obsolete in the future;
our need to raise additional funding and the availability of additional capital or capital on acceptable terms;
our reliance on third parties in connection with our field trials and research services;
the recognition of value in our products by farmers, and the ability of farmers and processors to work effectively with crops containing our traits;
our ability to produce high-quality plants and seeds cost effectively on a large scale;
our ability to accurately forecast demand for our products;
adverse natural conditions and the highly seasonal and weather sensitive nature of our business;
our exposure to product liability claims;
the adequacy of our patents and patent applications;
uncertainty relating to our patent positions that involve complex scientific, legal and factual analysis;
the limited lifespan of our patents and limitations in intellectual property protection in some countries outside the United States;
developments in patent law;
our ability to identify relevant third party patents and to interpret the relevance, scope and expiration of third party patents;

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potential assertions of infringement, misappropriation or other violations of intellectual property rights, including licensing agreements;
loss of damage to our germplasm libraries;
our status as an emerging growth company; and
those factors discussed under the caption entitled “Risk Factors.”

While the list of factors presented here is considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Consequences of material differences in results as compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, financial loss, legal liability to third parties and similar risks, any of which could have a material adverse effect on our consolidated financial condition, results of operations, credit rating or liquidity. Therefore, you should not rely on any of these forward-looking statements.

Any forward-looking statement made by us in this prospectus is based only on information currently available to us and speaks only as of the date hereof. We do not assume any obligation to publicly provide revisions or updates to any forward-looking statements after the date of this prospectus, whether as a result of new information, future developments or otherwise, should circumstances change, except as otherwise required by securities and other applicable laws.

Unless otherwise indicated, information contained in this prospectus concerning our industry and the markets in which we operate is based on information from various sources, including independent industry publications. In presenting this information, we have also made assumptions based on such data and other similar sources, and on our knowledge of, and our experience to date in, the potential markets for our products. The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section entitled “Risk Factors.” These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by us.

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OUR STRUCTURE AND REORGANIZATION

Summary of Offering Structure

This offering is conducted through an “Up-C” structure, which is often used by partnerships and limited liability companies when they go public. An Up-C structure allows the equity holders in an entity that is treated as a partnership for U.S. federal income tax purposes to retain certain tax benefits associated with their equity interests following an initial public offering. Cibus Global is currently classified as a “partnership” for U.S. federal and applicable U.S. state and local tax purposes, and intends to maintain that classification following this offering.

Currently, the holders of outstanding Cibus Global shares include eight separate U.S. limited liability companies (each, a “Blocker” and collectively, the “Blockers”). Each Blocker is a special purpose entity owned by an entity advised or sub-advised by Fidelity Management & Research Company (each, a “Blocker Owner” and collectively, the “Blocker Owners”) that was newly formed in connection with the Blocker Owners’ investment in Cibus Global’s Series C Preferred Shares. The sole assets of each of the Blockers are shares of Cibus Global owned by the respective Blocker Owner.

Investors in this offering will purchase Class A common shares issued by Cibus Ltd. Cibus Ltd. will utilize all of the net proceeds from this offering to purchase, indirectly through Cibus Holdings, newly issued Voting Equity Interests of Cibus Global. Cibus Holdings, a wholly-owned subsidiary of Cibus Ltd., is a Bermuda corporation that was formed to preserve certain tax efficiencies associated with our Up-C structure.

As part of the Reorganization Transactions (as defined herein) to be undertaken in connection with the offering, the Former Cibus Global Equity Owners will exchange all of their Cibus Global shares and any Warrants held by such Former Cibus Global Equity Owners for Class A common shares. The Continuing Cibus Global Equity Owners will continue to hold Cibus Global Non-Voting Equity Interests and any Warrants held by such Continuing Cibus Global Equity Owners and receive Class B common shares and following completion of this offering will have an ongoing right to exchange their Cibus Global Non-Voting Equity Interests and Class B common shares for Class A common shares.

The Class A common shares and Class B common shares will generally vote together as a single class on all matters submitted to a vote of our shareholders. The Class B common shares will not have any economic rights.

The Reorganization Transactions

In connection with this offering, we will effect an internal reorganization, which we refer to as the “Reorganization Transactions,” as described below. Prior to completing the Reorganization Transactions, the issued and outstanding shares in Cibus Global consist of convertible preferred shares and Non-Voting Equity Interests. Included in the issued and outstanding Non-Voting Equity Interests are certain restricted shares which were issued by Cibus Global to its employees, directors and other service providers, each of which has a “threshold value” amount, which is similar to the exercise price of a stock option. At the time the Reorganization Transactions are completed, certain of the restricted shares are subject to vesting.

We will implement the following steps in connection with this offering:

We will amend the organizational documents of Cibus Global to provide, among other things, that Cibus Global shall have a single director. Cibus Ltd. will concurrently be appointed to serve as the sole director of Cibus Global.
All of the issued and outstanding preferred shares in Cibus Global held by Original Cibus Global Equity Owners will be converted on a one-for-one basis into the existing class of Non-Voting Equity Interests in Cibus Global. In connection with the Conversion, the vesting schedules and threshold values that applied to restricted shares prior to the Conversion will continue to apply to the Equity Interests into which such restricted shares are converted (“restricted Equity Interests”).
Following completion of the Conversion, Cibus Global will undertake a           -for-one reverse Equity Interest split. After completion of this reverse split, a total of           Equity Interests (all of which will be Non-Voting Equity Interests) will be issued and outstanding in Cibus Global.

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Cibus Ltd. will acquire from the Blocker Owners all of the shares in the Blockers and, in exchange therefor, will issue to the Blocker Owners a number of Class A common shares equal to the number of Cibus Global Equity Interests held by such Blockers.
Cibus Ltd. will, directly or indirectly through Cibus Holdings, offer to acquire from certain Original Cibus Global Equity Owners (other than 2021 Plan Recipients, as defined herein), each of whom is an accredited investor (as defined in Rule 501 of Regulation D) that, prior to the Conversion, held fewer than           shares in Cibus Global (collectively, the “Mandatorily Exchanging Owners”), all of their respective Equity Interests (which will consist solely of Non-Voting Equity Interests) in Cibus Global in exchange for an equal number of Class A common shares; provided, however, that with respect to those Mandatorily Exchanging Owners who exchange restricted Equity Interests, the number of Class A common shares to be issued in exchange for such restricted Equity Interests will take into account the threshold value of such restricted Equity Interests and will be equal to (i) the number of such restricted Equity Interests multiplied by the Net IPO Price per Class A common share in this offering, minus the aggregate threshold value of such restricted Equity Interests, divided by (ii) the Net IPO Price.
Up to           non-accredited holders of Equity Interests in Cibus Global selected by Cibus Ltd. (the “Other Exchanging Owners”) will also be permitted to have all of their respective Equity Interests (which will consist solely of Non-Voting Equity Interests) in Cibus Global acquired by Cibus Ltd., directly or indirectly through Cibus Holdings, in exchange for an equal number of Class A common shares; provided, however, that with respect to Other Exchanging Owners who exchange restricted Equity Interests, the number of Class A common shares to be issued in exchange for such restricted Equity Interests will take into account the threshold value of such restricted Equity Interests and will be equal to (i) the number of such restricted Equity Interests multiplied by the Net IPO Price per Class A common share in this offering, minus the aggregate threshold value of such restricted Equity Interests, divided by (ii) the Net IPO Price.
Additionally, Cibus Ltd. will, directly or indirectly through Cibus Holdings, offer to acquire from the Mandatorily Exchanging Owners and Other Exchanging Owners any Warrants held by such Mandatorily Exchanging Owners and Other Exchanging Owners in exchange for a number of Class A common shares equal to (i) the number of Equity Interests for which such Warrant is exercisable multiplied by the Net IPO Price per Class A common share in this offering, minus the aggregate exercise price for the Equity Interests for which such Warrant is exercisable, divided by (ii) the Net IPO Price.
Cibus Global will offer to repurchase, utilizing proceeds from this offering, all Cibus Global Equity Interests and Warrants held by Original Cibus Global Equity Owners who are not accredited investors (other than Other Exchanging Owners and 2021 Plan Recipients). The purchase price per Equity Interest payable by Cibus Global will be equal to the Net IPO Price; provided, however, that the purchase price per share with respect to any restricted Equity Interests will be equal to the Net IPO Price, minus the applicable threshold value for such restricted Equity Interest. The purchase price per Warrant payable by Cibus Global will be equal to the number of Equity Interests for which such Warrant is exercisable multiplied by the Net IPO Price per Class A common share in this offering, minus the aggregate exercise price for the Equity Interests for which such Warrant is exercisable. Cibus Global will accelerate vesting of all unvested restricted Equity Interests held by non-accredited investors whose restricted Equity Interests are being purchased by Cibus Global. The aggregate purchase price for such Equity Interests and Warrants will be up to $         .
Cibus Global previously issued restricted shares to certain executives and key employees (the “2021 Plan Recipients”), all of which have a vesting date in November 2021. Following the completion of this offering, each 2021 Plan Recipient will continue to hold all of such 2021 Plan Recipient’s Equity Interests in Cibus Global (including all Equity Interests held by such 2021 Plan Recipient that are not restricted Equity Interests), subject to the same vesting schedule and threshold value that existed prior to completion of this offering.
The Continuing Cibus Global Equity Owners will each continue to own their respective Equity Interests (all of which will be Non-Voting Equity Interests) in Cibus Global following completion of this offering and any Warrants held by such Continuing Cibus Global Equity Owners prior to this

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offering. As detailed below, the Continuing Cibus Global Equity Owners will also be issued Class B common shares, which shares will have no economic rights with respect to Cibus Ltd. (such economic rights referring to the rights to receive dividends or other distributions from Cibus Ltd.) and will only be transferable in connection with a permitted transfer of corresponding Equity Interests held by Continuing Cibus Global Equity Owners. Following this offering, each Continuing Cibus Global Equity Owner will be entitled to cause Cibus Global to redeem some or all of such Continuing Cibus Global Equity Owner’s vested Equity Interests (including any Equity Interests issued by Cibus Global upon exercise of any Warrants) for an equal number of newly issued Class A common shares (with a corresponding cancellation of an equal number of such Continuing Cibus Global Equity Owner’s Class B common shares), subject, in the case of restricted Equity Interests, to adjustments to take into account applicable threshold values.

The exchange of Equity Interests by the Mandatorily Exchanging Owners and Other Exchanging Owners for Class A common shares and the repurchase of Equity Interests held by Original Cibus Global Equity Owners who are not accredited investors (other than Other Exchanging Owners and 2021 Plan Recipients), all as described above, are contemplated to occur on the date of the closing of this offering. In the event any such Mandatorily Exchanging Owner, Other Exchanging Owner or Original Cibus Global Equity Owner who is not an accredited investor (other than Other Exchanging Owners and 2021 Plan Recipients) does not execute agreements to perfect such transactions on the date of the closing of this offering, the Company may elect to exercise a Mandatory Redemption (as defined herein) to perfect the applicable Reorganization Transactions.

In connection with this offering, Cibus Ltd. will issue its Class B common shares to those Continuing Cibus Global Equity Owners who continue to hold their Equity Interests (all of which will be Non-Voting Equity Interests) in Cibus Global following this offering. Each such Continuing Cibus Global Equity Owner will receive one Class B common share for each Equity Interest held by such Cibus Global Equity Owner in Cibus Global. Additionally, a Continuing Cibus Global Equity Owner will be issued one Class B common share for each Equity Interest issued upon exercise of an outstanding Warrant. Although the Class B common shares will not entitle their holders to any economic rights, the holders of Class A common shares and Class B common shares will vote together as a single class on all matters presented to our shareholders for their vote or approval, except as otherwise required by applicable law. Each Class B common share will entitle its holder to one vote, except that the aggregate voting power of the Class B common shares will be limited to          % of the combined voting power of the Class A and Class B common shares. We do not intend to list the Class B common shares on any stock exchange. As noted above, upon any redemption of Equity Interests in Cibus Global caused by the holder thereof for Class A common shares on a one-for-one basis, such holder’s Class B common shares will also thereupon be cancelled, also on a one-for-one basis.

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The diagram below depicts our organizational structure after giving effect to the Reorganization Transactions summarized above, and after giving effect to the offering of Class A common shares:


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Structure Upon Completion of Offering

Cibus Ltd. is the issuer of the Class A common shares to be issued in this offering. Cibus Ltd. will utilize the net proceeds to purchase, directly or indirectly through Cibus Holdings, newly issued Voting Equity Interests of Cibus Global. The purchase price for these newly issued Voting Equity Interests in Cibus Global will be at per Equity Interest price equal to the Net IPO Price. Cibus Global will, in turn, use the proceeds from the sale of such newly issued Voting Equity Interests to Cibus Ltd. as described in “Use of Proceeds,” including the purchase of certain Non-Voting Equity Interests from certain non-accredited owners as described above in “—The Reorganization Transactions.”

Upon completion of the Reorganization Transactions and this offering:

The issued and outstanding share capital of Cibus Ltd. will be as follows:
                     Class A common shares (or           Class A common shares if the underwriters exercise their option to purchase additional shares in full) held by investors in this offering;
                     Class A common shares held by the Former Cibus Global Equity Owners and Blocker Owners; and
                     Class B common shares held by the Continuing Cibus Global Equity Owners.
All of the issued and outstanding shares of Cibus Holdings and the Blockers will be owned by Cibus Ltd.
The outstanding capitalization of Cibus Global will be as follows:
                     Voting Equity Interests and Non-Voting Equity Interests held by Cibus Holdings;
                     Non-Voting Equity Interests held by the Blockers; and
                     Non-Voting Equity Interests held by the Continuing Cibus Global Equity Owners.
The combined voting power in Cibus Ltd. will be as follows:
         % for investors in this offering (or          % if the underwriters exercise their option to purchase additional shares in full) who will hold Class A common shares;
         % for Former Cibus Global Equity Owners and Blocker Owners (or          % if the underwriters exercise their option to purchase additional shares in full) as a result of their holding Class A common shares; and
         % for the Continuing Cibus Global Equity Owners holding Equity Interests in Cibus Global and a corresponding number of Class B common shares.

The Former Cibus Global Equity Owners, together with those Continuing Cibus Global Equity Owners who elect following completion of this offering to exchange their Non-Voting Equity Interests, together with the corresponding Class B common shares, for our Class A common shares, will have the right, under certain circumstances, to cause us to register the offer and resale of their Class A common shares. See “Certain Relationships and Related Party Transactions—Registration Rights Agreement.”

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USE OF PROCEEDS

We estimate that the net proceeds to us from this offering will be approximately $          million, or approximately $          million if the underwriters exercise in full their option to purchase additional Class A common shares, assuming an initial public offering price of $          per share (the midpoint of the range set forth on the cover page of this prospectus), after deducting estimated underwriting discounts and commissions and estimated offering expenses.

Each $1.00 increase (decrease) in the public offering price per share would increase (decrease) our net proceeds, after deducting estimated underwriting discounts and commissions and estimated offering expenses, by approximately $          million (assuming no exercise of the underwriters’ option to purchase additional Class A common shares). An increase (decrease) of 1,000,000 in the number of shares we are offering would increase (decrease) our net proceeds, after deducting estimated underwriting discounts and commissions and estimated offering expenses, by approximately $          million, assuming the assumed initial public offering price stays the same.

We intend to use the net proceeds that we receive from this offering (including any net proceeds from the underwriters’ exercise of their option to purchase additional Class A common shares) to purchase Equity Interests in Cibus Global at a purchase price per Equity Interest equal to the Net IPO Price. We intend to cause Cibus Global to use a portion of such proceeds to (i) purchase all of the Equity Interests in Cibus Global held by certain investors in Cibus Global and (ii) satisfy certain withholding tax obligations, if applicable, that arise in connection with the disposition of Equity Interests by Original Cibus Global Equity Owners in connection with the Reorganization Transactions. See “Our Structure and Reorganization.”

We intend to cause Cibus Global to use the remainder of such proceeds it receives as follows:

approximately $          million to fund research and for development costs to advance trait development, to continue developing and improving our crop platforms in canola, flax, potato, cassava, peanut, wheat, corn and soybean, to progress our breeding program and germplasm collection and to add additional product candidates to our portfolio;
approximately $          million to further our automation capabilities, bioinformatics, lab information systems and other IT systems to support our research and development endeavors;
approximately $          million to build out commercial capabilities, which includes sales and marketing personnel costs as well as promotion and advertising for our products, to help drive demand creation;
approximately $          million to be used as working capital related to seed production; and
the remainder for general corporate purposes.

Cibus Global may also use a portion of the net proceeds to acquire or invest in complementary products, technologies or businesses, although it currently has no agreements or binding commitments to complete any such transaction.

However, due to the uncertainties inherent in the product development process, it is difficult to estimate with certainty the exact amounts of the net proceeds from this offering that may be used for the above purposes. The amount and timing of Cibus Global’s actual expenditures will depend upon numerous factors, including the results of its research and development efforts, the timing and success of its ongoing field trials or field trials it may commence in the future and the timing of regulatory submissions. As a result, management will have broad discretion over the use of the net proceeds from this offering, and investors will be relying on management’s judgment regarding the application of the net proceeds. In addition, Cibus Global might decide to postpone or not to pursue certain activities or field trials if the net proceeds from this offering and our other sources of cash are less than expected.

Pending the use of the net proceeds from this offering, Cibus Global intends to invest the net proceeds in a variety of capital preservation investments, including short-term, investment-grade, interest-bearing instruments.

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DIVIDEND POLICY

We do not anticipate declaring or paying any cash dividends to holders of our Class A common shares in the foreseeable future. We currently intend to retain future earnings, if any, to finance the growth of our business. If we decide to pay cash dividends in the future, the declaration and payment of such dividends will be at the sole discretion of our Board of Directors and may be discontinued at any time. In determining the amount of any future dividends, our Board of Directors will take into account any legal or contractual limitations, our actual and anticipated future earnings, cash flow, debt service and capital requirements and other factors that our Board of Directors may deem relevant. In addition, pursuant to Bermuda law, a company may not declare or pay dividends if there are reasonable grounds for believing that (1) the company is, or would after the payment be, unable to pay its liabilities as they become due or (2) that the realizable value of its assets would thereby be less than its liabilities.

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CAPITALIZATION

The following table sets forth our cash and cash equivalents and capitalization as of September 30, 2018:

on an actual basis;
on a pro forma basis to reflect the Reorganization Transactions, other than the use of proceeds from this offering by Cibus Global to repurchase Equity Interests held by Original Cibus Global Equity Owners who are not accredited investors (other than Other Exchanging Owners and 2021 Plan Recipients); and
on a pro forma as adjusted basis to give effect to (i) the Reorganization Transactions, (ii) the sale and issuance by us of           Class A common shares in this offering at an assumed initial public offering price of $          per share, the midpoint of the price range set forth on the cover page of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering expenses and (iii) the assumption that the net proceeds of this offering are held as cash, after giving effect to the repurchase by Cibus Global of the Equity Interests held by                 Original Cibus Global Equity Owners who are not accredited investors (other than Other Exchanging Owners and 2021 Plan Recipients) in connection with the Reorganization Transactions.

You should read this table in conjunction with our consolidated financial statements and the notes thereto, included in this prospectus as well as “Our Structure and Reorganization,” “Use of Proceeds,” “Selected Historical Consolidated Financial Data,” “Unaudited Pro Forma Consolidated Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this prospectus.

 
As of September 30, 2018
 
Actual
Pro Forma
Pro Forma
As Adjusted(1)
 
(In thousands, except share data)
Cash and cash equivalents
$
25,502
 
$
 
 
$
 
 
Shareholders’ (deficit) equity:
 
 
 
 
 
 
 
 
 
Series A convertible preferred shares, no par value; 83,446,895 shares authorized; 59,706,408 shares issued and outstanding; $101,294 liquidation preference
$
55,854
 
$
 
 
$
 
 
Series B convertible preferred shares, no par value; 31,295,438 shares authorized; 30,827,791 shares issued and outstanding; $57,031 liquidation preference
 
54,729
 
 
 
 
 
 
 
Series C convertible preferred shares, no par value; 43,357,667 shares authorized; 33,195,500 shares issued and outstanding; $69,711 liquidation preference
 
67,013
 
 
 
 
 
 
 
Voting common shares, no par value; 195,200,000 shares authorized; none issued and outstanding
 
 
 
 
 
 
 
 
Nonvoting common shares, no par value; 37,100,000 shares authorized; 33,965,786 shares issued and outstanding
 
890
 
 
 
 
 
 
 
Class A common shares, $0.00001 par value; no shares authorized, issued and outstanding, actual;          shares authorized,          shares issued and outstanding, pro forma
 
 
 
 
 
 
 
 
Class B common shares, $0.00001 par value; no shares authorized, issued and outstanding, actual;          shares authorized,          shares issued and outstanding, pro forma
 
 
 
 
 
 
 
 
Additional paid-in capital
 
43,995
 
 
 
 
 
 
 
Accumulated other comprehensive loss
 
(42
)
 
 
 
 
 
 
Accumulated deficit
 
(224,257
)
 
 
 
 
 
 
Total shareholders’ (deficit) equity
$
(1,818
)
$
 
 
$
 
 
Total capitalization
$
(1,818
)
$
            
 
$
            
 
(1)A $1.00 increase (decrease) in the assumed initial public offering price of $          per share would increase (decrease) each of, pro forma as adjusted cash and cash equivalents, additional paid-in capital, total shareholders’ equity and total capitalization by $ million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same, and after deducting the underwriting discount and estimated offering expenses payable by us. We may also increase or decrease the number of shares we are offering. Each increase (decrease) of 1,000,000 in the number of shares offered by us would increase (decrease) each of, pro forma as adjusted cash and cash equivalents, additional paid-in capital, total shareholders’ equity and total capitalization by $          million, assuming an initial public offering price of $          per share, after deducting the underwriting discount and estimated offering expenses payable by us.

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DILUTION

The Continuing Cibus Global Equity Owners will maintain their Equity Interests in Cibus Global after the Reorganization Transactions. Because the Continuing Cibus Global Equity Owners do not own any Class A common shares or have any right to receive distributions from Cibus Ltd., we have presented dilution in pro forma net tangible book value per share after this offering assuming that all of the holders of Equity Interests (other than Cibus Ltd.) had their Equity Interests redeemed or exchanged for newly-issued Class A common shares on a one-for-one basis (rather than for cash) and the cancellation for no consideration of all of their Class B common shares (which are not entitled to receive distributions or dividends, whether cash or shares from Cibus Ltd.) in order to more meaningfully present the dilutive impact on the investors in this offering. We refer to the assumed redemption or exchange of all Equity Interests for Class A common shares as described in the previous sentence as the “Assumed Redemption.”

Dilution is the amount by which the offering price paid by the purchasers of the Class A common shares in this offering exceeds the pro forma net tangible book value per Class A common share after the offering. Cibus Global’s net tangible book value as of September 30, 2018 was $          million. Net tangible book value per share is determined at any date by subtracting our total liabilities from the total book value of our tangible assets and dividing the difference by the number of Class A common shares deemed to be outstanding on that date.

If you invest in our Class A common shares in this offering, your ownership interest will be immediately diluted to the extent of the difference between the initial public offering price per share and the pro forma net tangible book value per Class A common share after this offering.

Pro forma net tangible book value per share is determined at any date by subtracting our total liabilities from the total book value of our tangible assets and dividing the difference by the number of Class A common shares, after giving effect to the Reorganization Transactions, this offering, and the Assumed Redemption. Our pro forma net tangible book value as of September 30, 2018 would have been approximately $          million, or $          per Class A common share. This amount represents an immediate increase in pro forma net tangible book value of $           per share to our existing stockholders and an immediate dilution in pro forma net tangible book value of approximately $             per share to new investors purchasing Class A common shares in this offering. We determine dilution by subtracting the pro forma net tangible book value per share after this offering from the amount of cash that a new investor paid for a Class A common share. The following table illustrates this dilution:

Assumed initial public offering price per share
 
 
 
$
      
 
Pro forma net tangible book value per share at September 30, 2018 before this offering(1)
$
      
 
 
 
 
Increase in pro forma net tangible book value per share attributable to new investors
 
 
 
 
 
 
Pro forma net tangible book value per share after this offering
 
 
 
 
 
 
Dilution in pro forma net tangible book value per share to new investors in this offering
 
 
 
$
 
 
(1)Gives pro forma effect to the Reorganization Transactions (other than this offering) and the Assumed Redemption.

Each $1.00 increase (decrease) in the assumed initial public offering price of $          per share (the midpoint of the price range set forth on the cover page of this prospectus) would increase (decrease) the pro forma net tangible book value per share after this offering by approximately $          million, and increase (decrease) the dilution per share to new investors participating in this offering by approximately $          per share, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

If the underwriters exercise their option in full to purchase           additional of Class A common shares in this offering, the pro forma net tangible book value per share after the offering would be $          per share, the

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increase in pro forma net tangible book value per share to our existing stockholders would be $          per share and the dilution per share to new investors participating in this offering would be $          per share, in each case assuming an initial public offering price of $         , which is the midpoint of the price range listed on the cover page of this prospectus.

The following table summarizes, as of September 30, 2018 after giving effect to this offering, the differences between the Original Cibus Global Equity Owners and new investors in this offering with regard to:

the number of Class A common shares purchased from us by new investors in this offering and the number of shares issued to the Original Cibus Global Equity Owners after giving effect to the Assumed Redemption,
the total consideration paid to us in cash by new investors purchasing Class A common shares in this offering and by the Original Cibus Global Equity Owners including historical cash contributions, and
the average price per Class A common share that such Original Cibus Global Equity Owners and new investors paid.
 
Shares Purchased
Total Consideration
Average Price
Per Share
 
Number
Percent
Amount
Percent
Original Cibus Global Equity Owners
 
 
 
 
 
%
$
 
 
 
 
%
$
 
 
New investors
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total
 
 
 
 
100
%
$
 
 
 
100
%
$
 
 

Each $1.00 increase (decrease) in the assumed initial public offering price of $          per share would increase (decrease) the total consideration paid by new investors by approximately $          million, assuming that the number of Class A common shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

Except as otherwise indicated, the discussion and the tables above assume no exercise of the underwriters’ option to purchase additional Class A common shares. In addition, the discussion and tables above exclude Class B common shares, because holders of Class B common shares are not entitled to distributions or dividends, whether cash or shares, from Cibus Ltd. The number of our Class A common shares issued and outstanding after this offering as shown in the tables above is based on the number of shares issued and outstanding as of September 30, 2018, after giving effect to the Reorganization Transactions and the Assumed Redemption, and excludes (i)           Class A common shares reserved for issuance under the 2018 Incentive Compensation Plan and (ii)           Class A common shares issuable upon exercise of the outstanding warrants. To the extent all of such outstanding options and warrants had been exercised as of September 30, 2018 the pro forma net tangible book value per share after this offering would be $         , and total dilution per share to new investors would be $          .

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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA

The following table presents the selected historical consolidated financial data for Cibus Global and its subsidiaries. Cibus Global is the predecessor of the issuer, Cibus Ltd., for financial reporting purposes. The selected consolidated statements of operations data for each of the years ended December 31, 2017 and 2016 and the selected consolidated balance sheet data as of December 31, 2017 and 2016 are derived from Cibus Global’s audited consolidated financial statements, included elsewhere in this prospectus. The selected consolidated statements of operations data for each of the nine months ended September 30, 2018 and 2017 and the selected consolidated balance sheet data as of September 30, 2018 are derived from Cibus Global’s unaudited consolidated financial statements, included elsewhere in this prospectus. The results for the nine months ended September 30, 2018 are not necessarily indicative of the results that may be expected for the full year.

The selected financial information below should be read together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in conjunction with the consolidated financial statements, related notes and other financial information included elsewhere in this prospectus.

The historical results are not necessarily indicative of future results and interim results are not necessarily reflective of the results to be expected for the full year. The summary financial information below does not contain all the information included in the financial statements.

The selected historical financial data of Cibus Ltd. have not been presented as Cibus Ltd. is a newly incorporated entity, has had no business transactions or activities to date and had no assets or liabilities during the periods presented in this section.

 
Nine Months Ended September 30,
Year Ended December 31,
Consolidated Statements of Operations Data:
2018
2017
2017
2016
 
(In thousands)
Revenue:
 
 
 
 
 
 
 
 
 
 
 
 
Product sales, net
$
2,372
 
$
1,839
 
$
1,839
 
$
597
 
Collaboration and research
 
253
 
 
705
 
 
848
 
 
1,196
 
Collaboration and research - related party
 
 
 
 
 
 
 
440
 
Total revenue
 
2,625