Bitfarms arranges $300-million (U.S.) note offering

Ms. Caroline Baker reports BITFARMS ANNOUNCES PROPOSED OFFERING OF US$300 MILLION OF CONVERTIBLE SENIOR NOTES Bitfarms Ltd. intends to offer $300-million (U.S.) aggregate principal amount of convertible senior notes due 2031. Bitfarms also expects to grant the initial purchasers of the convertible notes an option to purchase, for a 13-day period beginning on and including the date on which the convertible notes are first issued, up to an additional $60-million (U.S.) aggregate principal amount of the convertible notes. The offering is subject to market and other conditions (including receipt of Toronto Stock Exchange approval), and there can be no assurance as to whether, when or on what terms the offering may be completed. Description of notes The convertible notes will be senior unsecured obligations of the company and will accrue interest at a rate payable semi-annually in arrears on Jan. 15 and July 15 of each year, beginning on July 15, 2026. The convertible notes will mature on Jan. 15, 2031, unless earlier repurchased, redeemed or converted in accordance with their terms. Prior to Oct. 15, 2030, the convertible notes will be convertible only upon satisfaction of certain conditions, and, during certain periods and thereafter, the convertible notes will be convertible at the option of holders at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. The convertible notes will be convertible into cash, common shares of the company, or a combination of cash and common shares, at the company's election. The initial conversion rate, interest rate and other terms of the convertible notes will be determined at the time of pricing in negotiations with the initial purchasers of the convertible notes. Use of proceeds The company intends to use the net proceeds from the offering for general corporate purposes. Additionally, the company intends to use either net proceeds from this offering or cash on hand to pay the cost of the capped call transactions described below. Capped call transactions In connection with the offering of the convertible notes, the company expects to enter into privately negotiated cash-settled capped call transactions with one or more of the initial purchasers of the convertible notes, their respective affiliates and/or other financial institutions. The capped call transactions will cover, subject to anti-dilution adjustments substantially similar to those applicable to the convertible notes, the number of common shares that will initially underlie the convertible notes, assuming the initial purchasers do not exercise their option to purchase additional notes. If the initial purchasers of the convertible notes exercise their option to purchase additional convertible notes, the company expects to use the net proceeds from the sale of additional convertible notes for general corporate purposes, and, additionally, the company intends to use the net proceeds from the sale of the additional convertible notes or existing cash on hand to finance the cost of entering into additional capped call transactions with the capped call counterparties. The capped call transactions are expected generally to reduce potential economic dilution upon conversion of any convertible notes and/or offset any cash payments the company could be required to make in excess of the principal amount of any converted convertible notes upon conversion thereof, as the case may be, with such reduction and/or offset subject to a cap targeted at a 125-per-cent premium to the last reported sale price of Bitfarms' common shares on the Nasdaq Stock Market on the date of pricing. In connection with establishing the initial hedges of their capped call transactions, the company expects the capped call counterparties or their respective affiliates to purchase common shares and/or enter into various derivative transactions with respect to the common shares concurrently with or shortly after the pricing of the convertible notes, and such capped call counterparties or their respective affiliates may unwind these various derivative transactions and/or sell common shares in open market transactions. This activity could increase (or reduce the size of any decrease in) the market price of the common shares or the convertible notes at that time. In addition, the capped call counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to the common shares and/or purchasing or selling common shares or other securities of the company in secondary market transactions following the pricing of the convertible notes and prior to the maturity of the convertible notes (and are likely to do so during any observation period related to a conversion of the convertible notes). This activity could also cause or avoid an increase or decrease in the market price of the common shares or the convertible notes, which could affect holders of the convertible notes' ability to convert the convertible notes and, to the extent the activity occurs during any observation period related to a conversion of the convertible notes, it could affect the amount and value of the consideration that holders of the convertible notes will receive upon conversion of such convertible notes. The offering of the convertible notes is subject to certain conditions, including, but not limited to, the receipt of all necessary approvals, including the approval of the Toronto Stock Exchange and Nasdaq, and there can be no assurance as to whether, when or on what terms the offering may be completed. The convertible notes issued in connection with the offering and the common shares issuable upon the conversion of the convertible notes will be subject to a statutory hold period in accordance with applicable securities legislation. The company intends to rely on the exemption under Section 602.1 of the Toronto Stock Exchange's company manual, available to eligible interlisted issuers (as defined in the TSX manual) in respect of the offering. About Bitfarms Ltd. Bitfarms is a North American energy and digital infrastructure company that builds and operates vertically integrated, state-of-the-art data centres and energy infrastructure for high performance computing and bitcoin mining. With a focus on U.S. growth, Bitfarms' 1.3-gigawatt energy pipeline is more than 80 per cent United States based and clustered in data centre hotspots with robust access to power and fibre infrastructure. Bitfarms was founded in 2017 and is a proven leader in digital infrastructure with operations throughout the Americas. Bitfarms is headquartered in New York, N.Y., and Toronto, Ont., and traded on the TSX and Nasdaq. We seek Safe Harbor.