Financing driven by psychedelic investment fund Negev Capital and leading functional mushroom manufacturer Nammex

Filament Health Corp. (OTCQB: FLHLF) (NEO: FH) (FSE: 7QS) ("Filament" or the "Company"), a clinical-stage natural psychedelic drug development company, is pleased to announce that it intends to complete, subject to regulatory approval, a non-brokered private placement for gross proceeds of up to C$2,500,000 (the "Offering").

The Offering includes a non-brokered private placement of up to 1,250 convertible debenture units of the Company (the "Convertible Debenture Units") at a price of $1,000 per Convertible Debenture Unit for gross proceeds of up to $1,250,000 (the "Convertible Debenture Unit Financing") and a non-brokered private placement of up to 9,616,000 units (the "Units") at a price of $0.13 per Unit for gross proceeds of up to $1,250,080 (the "Unit Financing").

"This is an important development for Filament which amplifies our position at the forefront of botanical drug discovery," said Benjamin Lightburn, Chief Executive Officer and Co-Founder at Filament Health. "We are thrilled to partner with high quality investors like Nammex and Negev and welcome the enhancements they will bring to our Board of Directors and Advisory Council, as well as our long-term shareholder base."

"Negev Capital is excited to support Filament Health, among the most compelling  early-stage companies in the psychedelic space," said Ken Belotsky, Partner at Negev Capital. "We are especially impressed with Filament's creative, energetic, and strategic management team, strong IP, manufacturing and extraction expertise, and impressive partnerships. We are delighted to support their drug development strategy as they thoughtfully develop psychedelic treatments that can positively impact millions of lives."

The Company intends to use the net proceeds of the Offering for drug discovery and development, intellectual property initiatives, working capital and other general corporate purposes. Closing of the Offering is expected to occur on or about July 14, 2022, and remains subject to the final approval of the NEO Exchange.

"We have been following Filament's story over the past few years and are impressed by the team's rapid progress and technical capabilities," said Jeff Chilton, President of Nammex. "We are pleased to partner with another industry leader in botanical extraction, and are thrilled to help facilitate Filament's growth."

The Company also announced that the founders of Filament Health, Mr. Lightburn, Tom Kineshanko, and Joel Sherlock, have voluntarily extended their lock-up for all of their common shares for a period of 24 months, subject to limited exceptions. These shares represent approximately 67% of Filament's outstanding common shares.

The Unit Financing is led by Nammex whose founder, Mr. Chilton, will join Filament's Advisory Council. For over 30 years, Nammex has specialized in the development and manufacture of functional mushroom extract powders and is the premier supplier of organically certified mushroom extracts for the health and wellness industry.

Each Unit will consist of one Common Share and one common share purchase warrant (the "Warrants") of the Company. Each Warrant will be exercisable to acquire one common share of the Company (a "Common Share") for a period of 36 months following the closing date of the Offering at an exercise price of $0.30 per Common Share, subject to adjustment in certain events. The Unit Financing investors have agreed to sign a voluntary lock-up for all of the common shares for a period of 12 months.

Negev Capital, a psychedelic medical intervention investment fund that has made 20 investments to date, is the sole investor in the Convertible Debenture Unit Financing. The Company has also agreed to nominate a member of Negev Capital to Filament's Board of Directors, within 30 days post-closing.

Each Convertible Debentures Unit will consist of $1,000 principal amount of unsecured convertible debentures (the "Convertible Debentures") and 6,667 Warrants of the Company. Each Convertible Debenture will be convertible into Common Shares at a conversion price of $0.15 per Common Share. Each Warrant will be exercisable to acquire one Common Share for a period of 36 months following the closing date of the Offering at an exercise price of $0.30 per Common Share, subject to adjustment in certain events.

The Convertible Debentures are non-interest bearing and shall mature on the date that is the earlier of: a) 24 months from the date of issuance; or b) on the date the Company completes a financing of $5,000,000 or greater. Upon a change of control of the Company, holders of Convertible Debentures will have the right to require the Company to repurchase their Convertible Debentures, in whole or in part, on the date that is 30 days following notice of the change of control at a price equal to 105% of the principal amount of the Convertible Debentures then outstanding plus accrued and unpaid interest thereon.

Negev Capital has agreed to sign a voluntary lock-up agreement, consistent with the founders of Filament, for a period of 24 months, subject to certain exceptions.

The Common Shares, Warrants and Convertible Debentures, and any securities into which they may be exchanged or converted, will be subject to resale restrictions imposed by applicable securities laws, including a statutory hold period expiring four months and one day from the date of closing. The Offering is subject to approval from the NEO.

The offered securities have not been, nor will they be, registered under the United States Securities Act of 1933, as amended (the "Securities Act") or any state securities laws, and may not be offered or sold to, or for the account or benefit of, any person in the United States or any "U.S person", as such term is defined in Regulation S under the Securities Act, absent registration or an applicable exemption from registration requirements. Offers and sales in the United States will be limited to institutional accredited investors. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

Filament Health is a clinical-stage natural psychedelic drug development company. We believe that safe, standardized, naturally-derived psychedelic medicines can improve the lives of many, and our mission is to see them in the hands of everyone who needs them as soon as possible. Filament's platform of proprietary intellectual property enables the discovery, development, and delivery of natural psychedelic medicines for clinical development. We are paving the way with the first-ever natural psychedelic drug candidates.

Learn more atwww.filament.health and onTwitter, Instagram andLinkedIn.

Certain statements and information contained herein may constitute "forward-looking statements" and "forward-looking information," respectively, under Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as, "expect", "anticipate", "continue", "estimate", "may", "will", "should", "believe", "intends", "forecast", "plans", "guidance" and similar expressions are intended to identify forward-looking statements or information. Forward-looking statements herein include, but are not limited to, statements regarding the completion of the Offering; the terms of the Offering; the terms of the Warrants and Debentures; and the use of net proceeds of the Offering. The forward-looking statements are not historical facts, but reflect the current expectations of management of Filament regarding future results or events and are based on information currently available to them. Certain material factors and assumptions were applied in providing these forward-looking statements. Forward-looking statements regarding the Company are based on the Company's estimates and are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of Filament to be materially different from those expressed or implied by such forward-looking statements or forward-looking information, including completion of the Offering. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. Filament will not update any forward-looking statements or forward-looking information that are incorporated by reference herein, except as required by applicable securities laws.