LeoNovus Inc — Capital/Financing Update 2021

Jan 4, 2021

FORM 51-102F3 MATERIAL CHANGE REPORT

Item 1. Name and Address of Company

The name of the reporting issuer is Leonovus Inc. (the “Issuer” or “Company”). The Issuer’s business and registered office is located at 2611 Queensview Drive, Suite 125, Ottawa ON K2B 8K2.

Item 2. Date of Material Change

The material change occurred on January 4, 2021.

Item 3. News Release

The Company disseminated a News Release through a Canadian news wire service and filed a copy on SEDAR.

Item 4. Summary of Material Change

On January 4, 2021, the Company announced the closing of a private placement for CND $1,578,457.

Item 5. Full Description of Material Change

Please refer to the Company’s January 4, 2021 press release attached as Schedule “A”.

Item 6. Reliance on subsection 7.1(2) or (3) of National Instrument 51-102

The Issuer is not relying on sub-section 7.1(2) of National Instrument 51-102 or the equivalent provisions of the securities legislation in other jurisdictions governing the Issuer for the filing of this report.

Item 7. Omitted Information

No information has been omitted from this report on the basis that it is confidential information.

Item 8. Executive Officer

For further information, please contact George Pretli, Chief Financial Officer of the Issuer at 866-299-0815.

Item 9. Date of Report

January 04, 2021

Schedule A

LEONOVUS CLOSES $1,578,457 PRIVATE PLACEMENT

OTTAWA, January 4, 2021 /CNW/ - Leonovus Inc. (" Leonovus " or the “ Company ”) (TSXV: LTV) announces today the closing of a private placement for CDN $1,578,457, by way of issuance of 5,133,193 Units at a price of CDN $0.3075 per Unit. Each Unit includes one common share in the capital of the Company (a " Common Share ") and one Common Share purchase warrant (a " Warrant "). Each Warrant entitles the holder to buy one (1) Common Share for a period expiring on the day that is twelve (12) months after the issuance of the Units for CAD 0.60 per Common Share. The Warrant will expire at 5:00 p.m. (Ottawa time) on December 31, 2021. Notwithstanding the foregoing, if at any time after 4 months and 1 day following the Closing Date the 15-day volume weighted average price of the Common Shares on the TSX Venture Exchange (the “ Exchange ”) is equal to or exceeds $1.00, the Company has the right to notify the holders of Warrants of its intention to force the exercise of the Warrants. Upon the delivery of such notice, the Warrants' holders shall have 60 days to exercise the Warrants, failing which the Warrants will automatically expire.

In connection with the Offering, the Company paid a finder’s fee of $65,018.24 for finders having raised $928,832 and the Company directly raised $649,625. The securities issued in this Offering are subject to a four (4) month and one (1) day hold period from December 31, 2020. The Company intends on using the proceeds of the Offering for working capital, marketing, and debt repayment.

The two insiders of the Company subscribed for 800,000 Units combined, which was an aggregate amount of $246,000. Participation of insiders of the Company in the Offering constitutes a "related party transaction" as defined under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions (“ MI 61- 101 ”). The Offering is exempt from the formal valuation and minority shareholder approval requirements of MI 61101. Neither the fair market value of securities issued to insiders nor the consideration paid by insiders will exceed 25% of the Company's market capitalization. The Company did not file a material change report 21 days before closing the Offering because insider participation details had not been confirmed at that time. The Offering is subject to final acceptance by the Exchange.

About Leonovus

Leonovus builds data lakes and smart data management solutions for companies that need data-centric security (FIPS-120 Certified), data discovery, data collation and transport

solutions. The system includes an automated policy-based content discovery and categorization and consolidation engine, a unified, centrally controlled data repository that feeds AI, Machine Learning and Analytics engines. Leonovus supplies full data lifecycle management including, automated, policy-based transparent data migration and long-term multi-cloud data control and archiving. It is a distributed solution formed of several key components, including Leonovus Smart Filer, the multi-cloud data controller Vault.

In additions, the advanced geo-distributed architecture minimizes latency, perfects geoavailability, reduces remote backup costs, and meets data sovereignty requirements. With its software and hardware agnostic design, Vault supplies petabyte scalability. It allows the enterprise to use its existing idle storage resources, extend the useable lifespan of depreciated resources, and improve its overall ROI. To learn more, please visit www.leonovus.com.

This press release may have forward-looking statements and information, which may involve risks and uncertainties. The results or events predicted in these statements may differ materially from actual results or events. Factors that might cause a difference include, but are not limited to, competitive developments, risks associated with Leonovus’ growth, the state of the financial markets, regulatory risks and other factors. There can be no assurance or guarantees that any statements of forward-looking information contained in this release will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral statements containing forward-looking information are based on the estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. Unless otherwise required by applicable securities laws, Leonovus disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Readers should not place undue reliance on any statements of forward-looking information that speak only as of the date of this release. Further information on Leonovus’ public filings, including its most recent audited consolidated financial statements, are available at www.sedar.com.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For More Information, please contact:

George Pretli Chief Financial Officer gpretli@leonovus.com