Spectra7 Microsystems Inc. — Capital/Financing Update 2021

May 20, 2021

FORM 51-102F3

MATERIAL CHANGE REPORT

Item	1	Name and Address of Company
		Spectra7 Microsystems Inc. (the “Company”)
		181 Bay Street, Suite 1800
		Toronto, Ontario
		M5J 2T9
Item	2	Date of Material Change
		May 14, 2021
Item	3	News Release

A press release disclosing the material change was disseminated on May 14, 2021 through NewsWire.

Item 4 Summary of Material Change

On May 14, 2021, the Company announced that it had closed the first tranche of its previously announced brokered private placement (the “ Brokered Offering ”) of units (the “ Units ”) led by Cormark Securities Inc. as sole agent and bookrunner (the “ Agent ”). The first tranche of the Brokered Offering consisted of 170,689,567 Units at a price of $0.03 per Unit. The Company also completed a concurrent non-brokered offering (the “ Non-Brokered Offering ” and together with the Brokered Offering, the “ Offerings ”) of 12,700,800 Units at the same issue price as the Brokered Offering. In aggregate, the gross proceeds to the Company from the Offerings were approximately $5.5 million.

Each Unit consists of one common share in the capital of the Company (each, a “ Common Share ”) and one common share purchase warrant (each, a “ Warrant ”) with each Warrant being exercisable into one Common Share at an exercise price of $0.05 for a period of five years until May 14, 2026, subject to adjustment upon certain customary events. The expiry date of the Warrants can be accelerated by the Company to the date that is thirty (30) days following the delivery of the acceleration notice to the holders of the Warrants if, at any time following the date that is four months and one day following the closing date of the Offerings, the closing price of the Common Shares is greater than $0.08 for a period of 10 non-consecutive trading days on the TSXV.

The Agent received a commission equal to 7% of the aggregate proceeds raised in the Brokered Offering, and broker warrants entitling the Agent to purchase such number of Units as is equal to 7% of the aggregate of number of Units issued in the Brokered Offering at the issue price for a period of two years from closing.

Item 5 Full Description of Material Change

See above and the press release dated May 14, 2021, attached hereto as Schedule “A”.

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Item 6	Reliance on subsection 7.1(2) of National Instrument 51-102
	Confidentiality is not requested.

Item 7 Omitted Information

No information has been omitted in respect of the material change.

Item 8 Executive Officer

The following executive officer of the Company is knowledgeable about the material change disclosed in this report.

Dave Mier, Chief Financial Officer, Telephone: (925)-858-7011

Item 9 Date of Report

May 20, 2021

Schedule “A”

See attached.

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