Auscann : Response to ASX Price and Volume Query

20 June 2018

Isabelle Andrews

Adviser, Listings Compliance ASX Compliance Pty Ltd (Perth) Level 40, Central Park 152-158 St Georges Terrace PERTH WA 6000

Dear Ms Andrews

I refer to the ASX price query dated 20 June 2018 and respond as follows: (using your numbering).

• 1. AusCann Group Holdings Ltd (AC8 or the Company) is not aware of any information concerning it which has not been announced to the market which, if known by some in the market, could explain the recent trading in its securities.

• 2. Not applicable.

• 3. The Company is not aware of any other information that may explain the recent trading in the Company's securities.

• 4. The Company confirms that it is compliance with the Listing Rules, and in particular, Listing Rule 3.1.

• 5. The Company confirms that the above responses have been authorised and approved in accordance with its published continuous disclosure policy.

Yours sincerely

Susan Hunter Company Secretary

AusCann Group Holdings Ltd ACN 008 095 207www.auscann.com.au

Email:info@auscann.com.au

Phone: +61 8 9561 8834

Suite 8, Level 2, Shenton House, 57 Shenton Avenue, Joondalup, WA 6027 AUSTRALIA

20 June 2018

Ms Susan Hunter

Company Secretary AusCann Group Holdings Ltd Suite 8 Level 2 Shenton House 57 Shenton Avenue Joondalup WA 6027

Dear Ms Hunter

AusCann Group Holdings Ltd ("AC8"): price query

We note the change in the price of AC8's securities from an intra-day high of $1.24 to an intra-day low of $1.06 today, 20 June 2018.

We also note the significant increase in the volume of AC8's securities traded today, 20 June 2018.

In light of this, ASX asks AC8 to respond separately to each of the following questions and requests for information:

• 1. Is AC8 aware of any information concerning it that has not been announced to the market which, if known by some in the market, could explain the recent trading in its securities?

• 2. If the answer to question 1 is "yes":

  • a) Is AC8 relying on Listing Rule 3.1A not to announce that information under Listing Rule 3.1?

    Please note that the recent trading in AC8's securities would suggest to ASX that such information may have ceased to be confidential and therefore AC8 may no longer be able to rely on Listing Rule 3.1A.

    Accordingly, if the answer to this question is "yes", you need to contact us immediately to discuss the situation.

  • b) Can an announcement be made immediately?

    Please note, if the answer to this question is "no", you need to contact us immediately to discuss requesting a trading halt (see below).

  • c) If an announcement cannot be made immediately, why not and when is it expected that an announcement will be made?

• 3. If the answer to question 1 is "no", is there any other explanation that AC8 may have for the recent trading in its securities?

• 4. Please confirm that AC8 is in compliance with the Listing Rules and, in particular, Listing Rule 3.1.

• 5. Please confirm that AC8's responses to the questions above have been authorised and approved in accordance with its published continuous disclosure policy or otherwise by its board or an officer of AC8 with delegated authority from the board to respond to ASX on disclosure matters.

When and where to send your response

This request is made under, and in accordance with, Listing Rule 18.7. Your response is required as soon as reasonably possible and, in any event, by not later than 3:40pm (WST) on Wednesday 20 June 2018. If we do not have your response by then, ASX will have no choice but to consider suspending trading in AC8's securities under Listing Rule 17.3.

You should note that if the information requested by this letter is information required to be given to ASX under Listing Rule 3.1 and it does not fall within the exceptions mentioned in Listing Rule 3.1A, AC8's obligation is to disclose the information "immediately". This may require the information to be disclosed before the deadline set out in the previous paragraph.

ASX reserves the right to release a copy of this letter and your response on the ASX Market Announcements Platform under Listing Rule 18.7A. Accordingly, your response should be in a form suitable for release to the market.

Your response should be sent to me by e-mail atTradingHaltsPerth@asx.com.au.It should not be sent directly to the ASX Market Announcements Office. This is to allow me to review your response to confirm that it is in a form appropriate for release to the market, before it is published on the ASX Market Announcements Platform.

Listing Rules 3.1 and 3.1A

Listing Rule 3.1 requires a listed entity to give ASX immediately any information concerning it that a reasonable person would expect to have a material effect on the price or value of the entity's securities. Exceptions to this requirement are set out in Listing Rule 3.1A.

In responding to this letter, you should have regard to AC8's obligations under Listing Rules 3.1 and 3.1A and also to Guidance Note 8 Continuous Disclosure: Listing Rules 3.1 - 3.1B.

It should be noted that AC8's obligation to disclose information under Listing Rule 3.1 is not confined to, nor is it necessarily satisfied by, answering the questions set out in this letter.

Trading halt

If you are unable to respond to this letter by the time specified above, or if the answer to question 1 is "yes" and an announcement cannot be made immediately, you should discuss with us whether it is appropriate to request a trading halt in AC8's securities under Listing Rule 17.1.

If you wish to request a trading halt, you must tell us:

•  the reasons for the trading halt;

•  how long you want the trading halt to last;

•  the event you expect to happen that will end the trading halt;

•  that you are not aware of any reason why the trading halt should not be granted; and

•  any other information necessary to inform the market about the trading halt, or that we ask for.

We require the request for a trading halt to be in writing. The trading halt cannot extend past the commencement of normal trading on the second day after the day on which it is granted.

You can find further information about trading halts in Guidance Note 16 Trading Halts & Voluntary Suspensions.

If you have any queries or concerns about any of the above, please contact me immediately.

Kind regards

[Sent electronically without signature]

Isabelle Andrews

Adviser, Listings Compliance (Perth)