THC Biomed Intl : Annual Report AIF

Annual Information Form

For the Year Ended July 31, 2021

All figures expressed in Canadian Dollars

November 29, 2021

THC BioMed Intl Ltd. | CSE:THC

OTCQX:THCBF

FRA:TFHD

Table of Contents
Annual Information Form…...……………………………………………………………………………...................…1
Forward-Looking Statements ...............................................................................................................................	1
Glossary ..................................................................................................................................................................	2
Corporate Structure ...............................................................................................................................................	4
NAME, ADDRESS AND INCORPORATION .......................................................................................................	4
INTERCORPORATE RELATIONSHIPS..............................................................................................................	4
General Development of the Business ................................................................................................................	5
OVERVIEW OF THC BIOMED'S BUSINESS & CORPORATE STRATEGY......................................................	5
BRANDS and BUSINESS ....................................................................................................................................	5
RESEARCH and PRODUCT DEVELOPMENT ...................................................................................................	7
THREE YEAR HISTORY .....................................................................................................................................	8
LEGAL DEVELOPMENTS .................................................................................................................................	10
MARKETS, DISTRIBUTION AND PRODUCTION ...........................................................................................	14
MANUFACTURING AND PROCESSING OPERATIONS .................................................................................	14
STORAGE AND SECURITY………………………………………………………………………................………15
COMPETITIVE ENVIRONMENT .......................................................................................................................	17
PROTECTION OF INTELLECTUAL PROPERTY .............................................................................................	18
EMPLOYEES .....................................................................................................................................................	18
Risk Factors..........................................................................................................................................................	18
OVERVIEW ........................................................................................................................................................	18
KEY PERSONNEL RISKS .................................................................................................................................	18
LOW QUALITY CANNABIS RISK......................................................................................................................	18
LICENSING RISK...............................................................................................................................................	19
REGULATORY RISKS.......................................................................................................................................	19
CHANGE IN LAWS, REGULATIONS AND GUIDELINES.................................................................................	20
MARKET RISKS.................................................................................................................................................	20
COMMODITY PRICE RISKS .............................................................................................................................	20
RELIANCE ON KEY INPUTS ............................................................................................................................	20
FINANCING RISKS............................................................................................................................................	21
EXPANSION OF the FACILITY .........................................................................................................................	21
RISKS INHERENT IN AN AGRICULTURE BUSINESS ....................................................................................	21
BRAND PERCEPTION ......................................................................................................................................	21
SHARE PRICE VOLATILITY AND PRICE FLUCTUATIONS ............................................................................	22
COMPETITION…………………………………………………………………………...........………………………..22
INTELLECTUAL PROPERTY ............................................................................................................................	22
ENVIRONMENTAL AND OTHER REGULATORY REQUIREMENTS ..............................................................	22
PRODUCT LIABILITY ........................................................................................................................................	23
PRODUCT RECALLS ........................................................................................................................................	23
RESULTS OF FUTURE CLINICAL RESEARCH...............................................................................................	23
LITIGATION .......................................................................................................................................................	24
UNCERTAIN TAX BURDEN ..............................................................................................................................	24
HISTORY OF NET LOSSES; ACCUMULATED DEFICIT; REVENUE FROM OPERATIONS .........................	24
BREACHES OF SECURITY ..............................................................................................................................	24

UNINSURABLE RISKS .................................................................................................................................	....24
FINANCIAL PERFORMANCE OF SUBSIDIARY ..............................................................................................	24
EXPANSION INTO FOREIGN JURISDICTIONS ..............................................................................................	24
THIRD PARTY TRANSPORTATION ................................................................................................................	25
GLOBAL ECONOMY RISK ...............................................................................................................................	25
DIVIDEND RISK ................................................................................................................................................	25
Dividends ...............................................................................................................................................................	26
Description of Capital Structure.........................................................................................................................	26
Market for Securities ...........................................................................................................................................	27
PRIOR SALES.......................................................................................................................................................	27
ESCROWED SECURITIES AND SECURITIES SUBJECT TO RESTRICTIONS ON TRANSFER ....................	27
Directors and Officers .........................................................................................................................................	28
CORPORATE CEASE TRADE ORDERS OR BANKRUPTCIES......................................................................	28
PENALTIES OR SANCTIONS...........................................................................................................................	28
PERSONAL BANKRUPTCIES ..........................................................................................................................	29
CONFLICT OF INTEREST ................................................................................................................................	29
Promoter ...............................................................................................................................................................	29
Legal Proceedings and Regulatory Actions .....................................................................................................	30
Interest of Informed Persons in Material Transactions ...................................................................................	30
Transfer Agent and Registrar .............................................................................................................................	30
Material Contracts................................................................................................................................................	30
Audit Committee Information .............................................................................................................................	32
Interest of experts................................................................................................................................................	32
Additional Information ........................................................................................................................................	32
SCHEDULE "A" AUDIT COMMITTEE CHARTER

Annual Information Form

In this Annual Information Form (the "AIF"), unless otherwise noted or the context indicates otherwise, the "Company", "THC BioMed" "we", "us" and "our" refer to THC BioMed Intl Ltd. and its wholly-owned subsidiaries. All financial information in this AIF is prepared in Canadian dollars and using International Financial Reporting Standards. The information contained herein is dated as of July 31, 2021, unless otherwise stated.

Forward-Looking Statements

This AIF contains certain information that may constitute "forward -looking information" and "forward-looking statements" (collectively, "forward-lookingstatements") which are based upon the Company's current internal expectations, estimates, projections, assumptions and beliefs. Such statements can, in some cases, be identified by the use of forward-looking terminology such as "expect", "likely", "may", "will", "should", "intend", "anticipate", "potential", "proposed", "estimate" and other s imilar words, including negative and grammatical variations thereof, or statements that certain events or conditions "may" or "will" happen, or by discussions of strategy. Forward-looking statements include estimates, plans, expectations, opinions, forecasts, projections, targets, guidance, or other statements that are not statements of fact. The forward - looking statements included in this AIF are made only as of the date of this AIF. Forward -looking statements in this AIF include, but are not limited to, statements with respect to:

• the Company's operations are dependent on key technical personnel, and the loss of such personnel could have a significant impact on the Company's ability to conduct its activities
• competition
• currency fluctuations and exchange rates
• the Company's ability to continue as a going concern
• the Company may not be able to obtain all necessary funding for its operations, on terms satisfactory to the Company or at all
• credit risk
• the Company's dependence on information technology systems
• risks that the Company's software and applications may contain security problems, security vulnerabilities, or defects in design or manufacture, including "bugs" and other problems that could interfere with the intended operation of its software
• risks related to the volatility of customer demand for the Company's products
• risks associated with cybersecurity and privacy violations, in particular given the Company's operations are highly dependent on online technologies and the Company obtains a significant amount of personal information in the course of operations
• duration and impact of COVID-19 on our business plans, objectives and expected operating results

Certain of the forward-looking statements and other information contained herein concerning the medi cal and the adult recreational use cannabis industry and the general expectations of THC BioMed concerning the medical and the adult recreational use cannabis industry and concerning THC BioMed are based on estimates prepared by THC BioMed using data from publicly available governmental sources as well as from market research and industry analysis and on assumptions based on data and knowledge of this industry which THC BioMed believes to be reasonable. While THC BioMed is not aware of any misstatement regarding any industry or government data presented herein, the medical and the adult recreational use cannabis industry involves risks and uncertainties that are subject to change based on various factors and the Company has not independently verified such th ird-party information.

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Although the Company believes that the expectations reflected in such forward -looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement. In particular, but without limiting the foregoing, disclosure in this AIF under "General Development of the Business" as well as statements regarding the Company's objectives, plans and goals, including future operating results and economic performance may make reference to or involve forward -looking statements. A number of factors could cause actual events, performance or results to differ materially from what is projected in the forward-looking statements. See below under "Risk Factors" for further details. The purpose of forward-looking statements is to provide the reader with a description of management's expectations, and such forward-looking statements may not be appropriate for any other purpose. You should not place undue reliance on forward-looking statements contained in this AIF. THC BioMed undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

Glossary

The following terms used in this AIF and not otherwise defined, have the following respective meanings.

"ACMPR" means the Access to Cannabis for Medical Purposes Regulations (Canada).

"AIF" or "Annual Information Form" means this annual information form of the Company dated November 29, 2021.

"Cannabis" has the meaning given to such term in the Cannabis Act. "Cannabis Act" means the Cannabis Act, SC 2018, c 16.

"Cannabis Product" has the meaning given to such term in the Cannabis Regulations.

"Cannabis Regulations" means the Cannabis Regulations, SOR/2018-144.

"CBD" has the meaning given to such term in the Cannabis Regulations.

"Common Shares" means common shares in the capital of the Company.

"Facility" means THC BioMed's cannabis facility which is 29,940 square feet, of which 11,107 square feet is dedicated for cultivating cannabis flower, 15,883 square feet features ancillary services, and 3,000 square feet was under renovation which has received Health Canada approval and in use for ancillary services for edible production effective August 1, 2021.

"Health Canada" is the Canadian federal department responsible for health.

"IFRS" means the International Financial Reporting Standards.

"Key Personnel" means directors, officers, individuals who exercise, or are in a position to exercise, direct control over a licence holder, either in their individual capacity or as a director or officer of a corporation or as a partner in a partnership, and other individuals identified by the Minister, who must hold valid security clearances.

"Licence" means a licence issued under the Cannabis Regulations, or when used in reference to a time frame prior to October 17, 2018, a licence issued under the ACMPR or MMPR, as applicable

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