Deveron Corp. — Capital/Financing Update 2023

Oct 6, 2023

FORM 51-102F3 MATERIAL CHANGE REPORT

1. Name and Address of Company

Deveron Corp. (the " Company ") 82 Richmond Street East, Suite 200 Toronto, Ontario M5C 1P1

2. Date of Material Change

October 5, 2023

3. News Release

A press release disclosing the material change was released on October 5, 2023, through the facilities of Newsfile Corp.

4.

Summary of Material Change

On October 5, 2023, the Company completed the first tranche of a non-brokered private placement through the issuance of 1,750 unsecured convertible debentures (each, a " Debenture ") at a price of $1,000 per Debenture for gross proceeds of $1,750,000 (the " Offering ").

5. Full Description of Material Change

On October 5, 2023, the Company closed the Offering through the issuance of 1,750 Debentures at a price of $1,000 per Debenture for gross proceeds of $1,750,000. The issuance of the Debentures pursuant to the Offering were (and, if applicable, the underlying common shares of the Company (" Common Shares ") shall be) completed on a private placement and prospectus exempt basis, as applicable, such that the issuances are (or in the case of any underlying Common Shares, shall be) exempt from any applicable prospectus and securities registration requirements.

The Debentures will mature three (3) years following the date of issuance (the " Maturity Date ") and will bear interest at an interest rate of nine percent (9%) per annum, payable semi-annually in arrears in cash. The holder of a Debenture will have the right, from time to time and at any time after first year anniversary of the date of issuance, to the Maturity Date, to convert all or any portion of the outstanding principal amount into Common Shares, at a conversion price of $0.42 per Common Share (the " Conversion Price "), subject to adjustment as therein provided.

In connection with the Offering, the Company paid certain eligible finders a cash commission in the aggregate of $91,000 and issued 216,666 finder’s warrants (each, a " Finder Warrant "). Each Finder Warrant entitles the holder thereof acquire one Common Share at a price of $0.42 per Common Share until the date that is twelve (12) months from the date of issuance.

The following supplementary information is provided in accordance with Section 5.2 of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (" MI 61-101 ").

(a) a description of the transaction and its material terms:

In connection with the Offering, 200 Debentures were issued to an insider (the " Insider ") of the Company.

(b) the purpose and business reasons for the transaction:

The Company intends to use the net proceeds from the Offering to refinance the Company’s outstanding promissory note and for general working capital.

(c) the anticipated effect of the transaction on the issuer’s business and affairs:

The Company intends to use the net proceeds from the Offering to refinance the Company’s outstanding promissory note and for general working capital.

• (d) a description of:

  • (i) the interest in the transaction of every interested party and of the related parties and associated entities of the interested parties:

In connection with the Offering, the following Debentures were issued to the Insider:

Name	Position	Number ofDebentures	Aggregate Price
27396130 OntarioInc.(1)	Director	200	$200,000
	TOTAL	200	$200,000

Notes:

• (1) A corporation beneficially owned and controlled by Mr. Greg Patterson, a director of the Company.

• (ii) the anticipated effect of the transaction on the percentage of securities of the issuer, or of an affiliated entity of the issuer, beneficially owned or controlled by each person or company referred to in subparagraph (I) for which there would be a material change in that percentage:

Prior to the completion of the Offering, Mr. Patterson, held, directly or indirectly an aggregate of 13,688,182 Common Shares, and 200,000 stock options. Upon closing of the Offering, Mr. Patterson holds an aggregate 13,688,182 Common Shares, 200,000 stock options and $200,000 principal amount Debenture, representing approximately 8.75% of the issued and outstanding Common Shares on a non-diluted and approximately 9.14% of the issued and outstanding Common Shares on a partially diluted basis.

• (e) unless this information will be included in another disclosure document for the transaction, a discussion of the review and approval process adopted by the board of directors and the special committee, if any, of the issuer for the transaction, including a discussion of any materially contrary view or abstention by a director and any material disagreement between the board and the special committee:

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A resolution of the board of directors was passed on October 4, 2023, approving the Offering. No special committee was established in connection with the transaction, and no materially contrary view or abstention was expressed or made by any director.

• (f) A summary in accordance with section 6.5 of MI 61-101, of the formal valuation, if any, obtained for the transaction, unless the formal valuation is included in its entirety in the material change report or will be included in its entirety in another disclosure document for the transaction:

Not applicable.

• (g) disclosure, in accordance with section 6.8 of MI 61-101, of every prior valuation in respect of the issuer that relates to the subject matter of or is otherwise relevant to the transaction:

  • (i) that has been made in the 24 months before the date of the material change report:

Not applicable.

• (ii) the existence of which is known, after reasonable enquiry, to the issuer or to any director or officer of the issuer:

Not applicable.

• (h) the general nature and material terms of any agreement entered into by the issuer, or a related party of the issuer, with an interested party or a joint actor with an interested party, in connection with the transaction:

Other than the subscription agreements to purchase the Debentures pursuant to the Offering, the Company did not enter into any agreement with an interest party or a joint actor with an interested party in connection with the Offering. To the Company’s knowledge, no related party to the Company entered into any agreement with an interest party or a joint actor with an interested party, in connection with the Offering.

• (i) disclosure of the formal valuation and minority approval exemptions, if any, on which the issuer is relying under sections 5.5 and 5.7 of MI 61-101 respectively, and the facts supporting reliance on the exemptions:

The participation in the Offering by the Insider is exempt from the formal valuation and minority shareholder approval requirements of Multilateral Instrument 61-101 – Protection of Minority Securityholders in Special Transactions (" MI 61-101 ") as the Company is not listed on a specified market and the fair market value of the participation in the Offering by the insider does not exceed 25% of the market capitalization of the Company in accordance with MI 61-101.

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

The report is not being filed on a confidential basis.

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7. Omitted Information

No significant facts have been omitted from this Material Change Report.

8. Executive Officer

For further information, contact David MacMillan, President and Chief Executive Officer of the Company at (416) 367-4571.

9. Date of Report

This report is dated at Toronto, this 6[th] day of October, 2023.

Cautionary Statement Regarding Forward-Looking Information

This material change report includes certain "forward-looking statements" within the meaning of that phrase under Canadian securities laws. Without limitation, statements regarding future plans and objectives of the Company are forward looking statements that involve various degrees of risk. Forwardlooking statements reflect management's current views with respect to possible future events and conditions and, by their nature, are based on management's beliefs and assumptions and subject to known and unknown risks and uncertainties, both general and specific to the Company. Although the Company believes the expectations expressed in such forward-looking statements are reasonable, such statements are not guarantees of future performance and actual results or developments may differ materially from those in our forward-looking statements. The following are important factors that could cause the Company’s actual results to differ materially from those expressed or implied by such forward looking statements: changes in the worldwide price of agricultural commodities, general market conditions, risks inherent in agriculture, the uncertainty of future profitability and the uncertainty of access to additional capital. Additional information regarding the material factors and assumptions that were applied in making these forward looking statements as well as the various risks and uncertainties we face are described in greater detail in the "Risk Factors" section of our annual and interim Management's Discussion and Analysis of our financial results and other continuous disclosure documents and financial statements we file with the Canadian securities regulatory authorities which are available at www.sedar.com. The Company undertakes no obligation to update this forward-looking information except as required by applicable law. The Company relies on litigation protection for forward looking statements

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