Letter From the President

Investor Update

Vancouver, BC – August 12th, 2020

Dear Shareholders and Debenture Holders,

We are on a roll! With the leadership of our new CEO Eric “Grip” Gripentrog. We have embarked on a new brand roll up strategy with five acquisition/merger targets currently under NDA. We are also pleased to announce we have completed a bi-annual interest payment to our convertible debenture holders on June 30th, 2020. We thank the debenture holders and shareholders for their continued support of the company as we execute on our ambitious growth strategy and work towards a liquidity event.

Our wholly owned Kirkman® Nutraceutical manufacturing unit had second quarter record sales of $USD1.63M[1]. Once again sales of our trusted immune system support products continue to increase in popularity. Kirkman® is functioning well and continues to obtain new contract manufacturing and white label contracts. We continue to evaluate options to further expand the Kirkman® brand as well as its manufacturing capability.

On the industrial hemp sales front, we had seen a solid increase in flower sales for May, June and July that is now slowing, as expected, in anticipation of the September harvest. We’ve planted five new strains from our trusted breeders at Oregon CBD Seeds with unique terpene profiles and we’re expecting some amazing flower from the upcoming harvest. We have seen significant growth in the sales volume and stable prices for our hemp flower and anticipate the overall market will continue to grow. In October, we intend to launch flower, prerolls, and hemp cigarettes under the Hemptown USA brand, with a product line consisting of five new flower strains: Super Sour Space Candy, Sour Special Sauce, Sour Lifter, Sour Suver Haze, and Sour G CBG.

We are seeing growing demand for CBG bulk ingredients, biomass, crude oil, distillates, and isolates. We have received several POs for bulk wholesale CBG extracts, as we continue to see the industry/market adoption of CBG as the next cannabinoid.

FARM UPDATE

This year we plan to farm in Oregon exclusively. Primary factors for this include an oversupply of industrial hemp biomass in the market from the 2019 harvest season. Oregon’s superior climate and growing conditions are well known for producing the best “flower” in the United States. The current data is reporting that only 20% of last year’s hemp producers will grow in 2020, suggesting a stable, to moderately stronger, commodity price post-harvest, and extending into 2021.

Our growing plans in Southern Oregon include both CBD and CBG strains. Our primary focus will be harvesting “flower” for our bulk wholesale customers, as well as our own line of Hemptown branded products for the smokable market. Our unique new strains, with their exotic terpene profiles, only released this year from Oregon CBD Seeds, will help us capture the premium CBD/CBG flower customers. The remaining plant material, after the flower is harvested, will be processed into distillates and/or isolate for use in our own Hemptown Consumer Packaged Goods Brands, and for our white label manufacturing customers.

PROCESSING UPDATE

We have been toll-processing both CBG/CBD isolate and distillate with our select partners since the beginning of 2020. We continue to work towards building, and or acquiring, a processing facility to convert our post-harvest biomass into distillates and isolates for our manufacturing facility to incorporate in our Hemptown and white label consumer packaged goods. This will mitigate our reliance on external parties making Hemptown a fully vertical integrated company in the hemp space. These diversification efforts will further enhance our ability to ship bulk ingredients to clients and distributors overseas, primarily the EU, the UK and Switzerland, where we are seeing demand and prices remain firm.

MARKET UPDATE

The CBG biomass market has compressed further and we are currently seeing prices as low as $20/lb. Even at this level we are achieving a strong margin as our costs to grow in 2019 were approximately $14.00/lb. 2020 per pound costs are expected to be below $10.00/lb due to capital investments made in equipment and mechanization on the farm in the last year.

GROWTH PLANS AND MOVING DOWN THE VALUE CHAIN

In the last forty-five days we have signed five nondisclosure agreements and sent out two Letters of Intent (LOIs) laying out the terms of our offers to acquire 100% of the various businesses that all align with Hemptown’s ‘buy vs. build’ approach and provide accretive revenue. We have engaged the services of Canaccord Genuity to assist us in the execution of our M&A strategy, with the investment bank supporting due diligence and valuation work.

On July 21st, 2020, we announced an LOI with a group of two hemp smokable companies, Hempacco Company Inc. (“Hempacco”) and Pacifica Premiums Inc. (“Pacifica Premiums”). The LOI contemplates that Hemptown will acquire all of the outstanding shares of both Hempacco and Pacifica Premiums, to further diversify the Company’s product offering into the hemp cigarette business and expand our distribution and sales channels. This acquisition aligns with Hemptown’s strategy of vertical integration, whereby Hemptown’s farming operations will supply 100% of the hemp required by Hempacco and Pacifica for their own brands and private label services, including our own Hemptown branded hemp smokables. To learn more about the LOI and the companies, click here to view the full release.

On July 21st, 2020, the company also announced a non-brokered offering (the “Offering”) of units of the Company (the “Units”) at a price of USD$1.75 per Unit.

Each Unit consists of one common share (a “Unit Share”) and one common share purchase warrant (a “Warrant”) of the Company. Each Warrant shall be exercisable to acquire one common share of the Company (a “Warrant Share”) at an exercise price of CDN$4.00 per Warrant Share for a period of 36 months from the closing date, subject to adjustment in certain events.

For more information on the Offering click here or contact John Martin at 1-(833)-436-7896 or jmartin@hemptownusa.com.

Management remains focused on ensuring that the company completes a liquidity event in the foreseeable future and hopes to provide further clarity on the liquidity strategy to investors in the coming weeks. Again, we thank all shareholders and debenture holders for their continued support and patience as we grow in this unique and new industry. We remain committed to achieve our vision of becoming the “P&G of the industry”.

Best Regards,

Michael Townsend

President, Director and Co-Founder

About Hemptown Organics Corp.

Hemptown is diversified, industry leading cannabinoid company delivering a diverse product offering across the value chain, in multiple sales channels, to meet the growing global demand for cannabinoid-based products. State of the art cultivation in Oregon’s Rogue Valley, FDA-licensed and cGMP certified product manufacturing, and a strong leadership team with Fortune 500 experience, including Kellogg’s, Nike and Intel, are the pillars for Hemptown’s growth model as the Company pushes into the consumer-packaged goods sectors with top quality white label and branded product lines for the consumer market. For more information, visit www.hemptownusa.com.

Hemptown Investor Relations

John Martin

jmartin@hemptownusa.com

1-833-436-7896

Hemptown Sales and General Inquires

info@hemptownusa.com

1-888-CBG-NOW1 (1-888-224-6691)

Disclaimer for Forward-Looking Statements

This news release contains forward-looking statements that involve various risks and uncertainties regarding future events. Such forward-looking statements are based on current expectations of management, involve a number of risks and uncertainties, and are not guarantees of future performance. These statements generally can be identified by the use of forward-looking words such as “may”, “should”, “will”, “could”, “intend”, “estimate”, “plan”, “anticipate”, “expect”, “believe” or “continue”, or the negative thereof or similar variations. Forward-looking statements in this news release include statements regarding the proposed acquisition of Hempacco and Pacifica Premiums, and the proposed Offering. Forward-looking statements are necessarily based on a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors that may cause actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include general market conditions, significant business, competitive, political and social risks and other factors beyond the control of the Company. The Company expressly disclaims any intention or 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.

Because Hemptown is not a reporting issuer in any jurisdiction in Canada, all of the securities issued in the proposed Offering will be subject to an indefinite hold period under applicable securities laws. In addition, none of these securities will be registered under the United States Securities Act of 1933, as amended (the “1933 Act”), and none may be offered or sold in the United States absent registration or an applicable exemption from the 1933 Act. This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of the securities, in any state where such offer, solicitation or sale would be unlawful.

[1] Unaudited