Mr. Andre Audet reports

MOLECULE HOLDINGS INC. PROVIDES UPDATE ON APPLICATION FOR MANAGEMENT CEASE TRADE ORDER AND CORPORATE UPDATE

Further to Molecule Holdings Inc.'s press release dated Sept. 15, 2023, the Ontario Securities Commission (OSC), as principal regulator of the company, has denied the company's application for a management cease trade order (MCTO) under National Policy 12-203 -- Management Cease Trade Orders (NP 12-203). As such, on Oct. 5, 2023, the OSC issued a failure-to-file cease trade order (CTO), prohibiting the trading by any person or company of any securities of the company in Canada, except pursuant to limited exceptions under the CTO.

The CTO was issued as a result of a delay in the preparation of the company's interim financial statements, management's discussion and analysis, and related officer certifications for the three and nine months ended July 31, 2023 (collectively, the interim filings), as required under parts 4 and 5 of National Instrument 51-102 -- Continuous Disclosure Obligations and pursuant to National Instrument 52-109 -- Certification of Disclosure in Issuer's Annual and Interim Filings. The continuing delay is as a result of a contractual dispute between the company and the financial services company that assists the company with finance-related consulting services regarding the delayed payment of fees. The company continues to engage in active discussions with the consultant in order to agree to an amicable resolution. Management of the company has also initiated the process of exploring alternative paths for the preparation and filing of the interim filings in the event the dispute cannot be resolved.

The CTO will remain in place until such time as it is revoked following the filing of the interim filings by the company, in accordance with National Policy 11-207 -- Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions.

There can be no assurance that the company will be able to remedy its filing default and have the CTO lifted in a timely manner, or at all. Shareholders of the company may suffer a significant decline or total loss in value of its investment in the common shares in the capital of the company as a result.

The company regrets this unnecessary delay in filing and the inconvenience to shareholders, and intends file the interim filings as soon as possible.

The company will make further announcements with respect to the status of the interim filings as and when appropriate.

Corporate update

The company is also pleased to provide a general corporate update regarding its continuing activities.

The company continues to operate its business activities on a reduced budget in order to preserve cash resources. The company is continuing to manufacture and deliver product to its customers upon receipt of purchase orders. The company's key brands, Phresh Waters, Phresh Strains, Embody and Dulces continue to perform strong sales volumes by meeting forecasted projections.

On Sept. 16, 2023, the aggregate principal amount of $1,065,000 in unsecured debentures issued on Sept. 16, 2020, became due and payable (the matured debentures). The company is engaged in discussions with both the Canadian Securities Exchange and the holders of certain debentures issued by the company, including the holders of the matured debentures, to amend the terms of such debentures in order to allow for conversion on terms satisfactory to the company, the holders and the CSE.

The company believes that amendments of certain debentures, if approved by all relevant stakeholders, will assist the company in reorganizing its capital structure in order to attract investment required to manage the growth of the business. The company has initiated conversations with potential investors regarding a financing, and investors have shown potential interest at this preliminary stage.

However, at present, there can be no assurance as to what, if any, alternatives might be pursued by the company. There can also be no assurance that the company will reach any solution with the holders and the CSE, the terms of any such solution, if achieved, or the completion of any financing.

About Molecule Holdings Inc.

Molecule is a licensed producer dedicated to creating cannabis-infused beverages for the Canadian market. It produces leading, top-quality drinks to provide opportunity and choice to people seeking a convenient and social way to consume cannabis. Molecule is focused on building both its portfolio and the overall cannabis beverage market. It wants to ensure people have the best opportunity to find exactly the product and experience they thirst for.

We seek Safe Harbor.