Hempfusion Wellness Inc. — Capital/Financing Update 2021

Jan 15, 2021

Form 51–102F3 MATERIAL CHANGE REPORT

Item 1. Name and Address of Company

HempFusion Wellness Inc. (“ HempFusion ” or the “ Company ”) 708 Gravenstein Hwy N., Suite 188 Sebastopol, California 95472

Item 2. Date of Material Change

January 6, 2021

Item 3. News Release

A news release announcing the material change referred to in this Material Change Report was disseminated by the Company through Business Wire on January 6, 2021 and filed under the Company’s profile on SEDAR on the same date.

Item 4. Summary of Material Change

On January 6, 2021, the Company completed its initial public offering of 7,000,000 common shares of the Company (the “ Offered Shares ”) at a price of USD$1.00 per Offered Share (the “ Offering Price ”) for gross proceeds of USD$7,000,000 (the “ Share Offering ”) and 10,000,000 units of the Company (the “ Units ”) at the Offering Price per Unit for gross proceeds of USD$10,000,000 (the “ Unit Offering ” and collectively with Share Offering, the “ Offering ”). HempFusion’s common shares (the “ Common Shares ”) (117,342,984 in total), the common share purchase warrants comprising the Units (the “ Warrants ”) (5,000,000 in total) and the common share purchase warrants issued in connection with the Company’s offering of units completed in August 2019 (the “ 2019 Warrants ”) (24,163,553 in total) commenced trading on the Toronto Stock Exchange (the “ TSX ”) on January 6, 2021 under the symbols CBD.U, CBD.WT.V and CBD.WT.U, respectively.

Item 5.1 Full Description of Material Change

On January 6, 2021, the Company completed its initial public offering of 7,000,000 Offered Shares at the Offering Price per Offered Share for gross proceeds of USD$7,000,000 and 10,000,000 Units at the Offering Price per Unit for gross proceeds of USD$10,000,000.

The Common Shares (including the Offered Shares, the Unit Shares (as described below) and the Warrant Shares (as described below)) (117,342,984 in total), the Warrants (5,000,000 in total) and the 2019 Warrants (24,163,553 in total) commenced trading on the TSX on January 6, 2021 under the symbols CBD.U, CBD.WT.V and CBD.WT.U, respectively.

The Offering was completed through a syndicate of agents led by Canaccord Genuity Corp., as sole bookrunner, and including Haywood Securities Inc. and PI Financial Corp. (collectively, the “ Agents “). Each Unit offered under the Unit Offering is comprised of one Common Share (each a “ Unit Share ”) and one-half of one Warrant. Each Warrant entitles the holder to purchase one Common Share (each, a “ Warrant Share ”) at a price of USD$1.20 per Warrant Share at any time until January 6, 2026. The Unit Shares are

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subject to a contractual hold period and may not be sold, transferred, pledged, hypothecated or otherwise assigned or traded until May 6, 2021. The Warrant Shares will be subject to a contractual hold period and may not be sold, transferred, pledged, hypothecated or otherwise assigned or traded until July 6, 2022.

The exercise price of the 2019 Warrants, each of which is exercisable to acquire one Common Share (each a “ 2019 Warrant Share ”), was subject to adjustment based on the Offering Price and has now been confirmed at USD$0.85 per 2019 Warrant Share. The 2019 Warrant Shares will be subject to a contractual hold period and may not be sold, transferred, pledged, hypothecated or otherwise assigned or traded until July 6, 2022.

Under the terms of an agency agreement entered into between the Company and the Agents, the Company has granted the Agents an over-allotment option, exercisable in whole or in part, at the sole discretion of the Agents, at any time and from time to time, for a period of 30 days following the closing of the Offering, to purchase up to an additional 1,050,000 Offered Shares at the Offering Price per Offered Share and 1,500,000 Units at the Offering Price per Unit, for additional gross proceeds to the Company of up to USD$2,550,000.

5.2 Disclosure for Restructuring Transactions

Not applicable.

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

Not applicable.

Item 7. Omitted Information

No information was omitted.

Item 8. Executive Officers

The following senior officer of the Company is knowledgeable about the material change and this Material Change Report and may be contacted:

Jason Mitchell, Chief Executive Officer Telephone: 416-803-5638

Item 9. Date of Report

January 15, 2021