Auxly Cannabis Group — Capital/Financing Update 2021

Feb 9, 2021

FORM 51-102F3

MATERIAL CHANGE REPORT

1. Name and Address of Issuer:

Auxly Cannabis Group Inc. (the " Company ") 777 Richmond Street West Suite #002 Toronto, Ontario M6J 0C2

2. Date of Material Change:

February 8, 2021.

3. News Release:

The news release disclosing the substance and nature of the material change was issued and disseminated on February 8, 2021 and subsequently filed on SEDAR.

4.

Summary of Material Change:

On February 8, 2021, the Company completed the closing of its bought deal short form prospectus offering pursuant to which the Company issued 54,395,000 units of the Company (the " Units ") at a price of $0.37 per Unit for gross proceeds of $20,126,150 (the " Offering "), including the full exercise of the over-allotment option granted to the Underwriters (as defined below).

5.

5.1 – Full Description of Material Change:

Each Unit is comprised of one common share of the Company (each a " Common Share ") and onehalf of one Common Share purchase warrant of the Company (each whole warrant, a " Warrant "). Each Warrant entitles the holder thereof to purchase one Common Share at an exercise price of $0.46 at any time up to 36 months from closing of the Offering.

The Offering was co-led by ATB Capital Markets Inc. and Cantor Fitzgerald Canada Corporation as co-lead underwriters and joint bookrunners (collectively, the " Co-Lead Underwriters "), each for itself and on behalf of a syndicate of underwriters including Mackie Research Capital Corporation, Raymond James Ltd. and Desjardins Securities Inc. (collectively with the Co-Lead Underwriters, the " Underwriters ").

The net proceeds from the Offering will be used for working capital and other purposes as described in the prospectus of the Company dated February 1, 2021 prepared in connection with the Offering.

6. Reliance on subsection 7.1(2) of National Instrument 51-102:

Not applicable.

7.

Omitted Information:

No significant facts remain confidential in, and no information has been omitted from, this report.

8. Executive Officer:

For further information, please contact Hugo Alves, Chief Executive Officer, at hugo@auxly.com.

9. Date of Report:

February 8, 2021.