Business Plan

-C Quadrant, LLC-
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 Confidentiality Agreement

This document contains confidential information proprietary to C Quadrant, LLC

(hereinafter frequently referred to as the “Company”). This information and related
conversations are submitted solely for the purpose of introducing selected parties to the
Company’s Business Plan. The Company’s disclosure of information contained herein
and in related conversations does not constitute any subscription or authorization to use
the information, ideas, or concepts presented, or to disclose any information to other
parties. The Company retains ownership of this Plan, and the concepts and ideas
described herein.

Each recipient of this document agrees to treat it in a strictly confidential manner. The
recipient may not disclose, directly or indirectly, or permit any agent or affiliate to
disclose any of the information contained herein or reproduce this document in whole or
part without the prior written consent of the Company.

Any party who accepts delivery of this Plan or any other document or verbal
communication of confidential information from the Company agrees to be bound by the
terms of this Confidentiality Statement and further agrees to promptly return documents
to the Company upon request.

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Contents Page

1. Executive Summary 4
2. The Opportunity 5
Customers Demand 6
Investment Requirements 6
3. About the Company 8
Mission Statement 8
Our Vision 8
Company Overview 8
Company Details 9
Promoters and Shareholders 9
Legal Status 10
Advisors 10
The Equipment 10
The Extraction Processes 11
Main Extraction Methods 11
Location and Facilities 11
Goals and Key to success 11
Objectives 12
Market Analysis 12
Competition Analysis 16
Pricing Strategy 17
Competitive Edge 18
SWOT Analysis 18
Growth drivers 19
Operational Processes Map 19
Security 19
Extraction Process 19
Lab testing 20
Customer Service 20
Risk Minimizing 20
Costs 20
Accounting 20
Tax administration 20
Milestones 20
Strategic Alliances 21
Exit Strategy 22
Mergers and Acquisitions 22
IPO 22
Marketing 22
Management Team 23
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Key personnel: 23
Financial Analysis 25
Startup Costs 25
Cash Flow Statement 26
Profit and Loss 27
Balance Sheet 28
Revenue Model 29

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1. Executive Summary

The purpose of this Business Plan is to introduce our (i.e., C Quadrant, LLC (hereinafter
referred to as the “Company” or “C-Quad”) plan for extracting cannabis in a highly
equipped facility, owned by the Company, located in Salinas, California (i.e., in the
“Salad Bowl” of California). In this document, we have compiled data and presented the
development strategy that will help us reach our goals and grow stable business
operations while at the same time provide high-quality service. This Business Plan will
provide an overview and resource as to why we firmly believe that marijuana extracting
and selling could be the single best investment opportunity of the next decade.

Medical Marijuana has been

long recognized as a
medical product capable of
assisting people with some
medical illnesses. More than
50% of today’s legal
marijuana sales are
concentrates and infused
products; extracts constitute
the fastest growing segment
of the marketplace. Demand
is expected to exceed the
supply of cannabis for the next few years. We aim to become an industry-leading
cannabis extraction company based in California. Our main mission is to set the
standards of safety and quality within the cannabis extraction industry. We are
committed to sustainability and best practices for cannabis extraction.

Extraction is a booming business. In more developed markets (e.g., Colorado, Oregon

and Washington), up to 70% of all retail sales come from some form of extract derived
product. We will be delivering sustainability and scale to the extraction of medical cannabis.

C-Quad is engaged in the development of standardized and scalable cannabidiol

extraction processes that can deliver a consistent and high-quality concentrate. The
company is positioned to become a leading cannabis extraction company.

The Company has purchased a 5-acre property with a ~41,000 square foot building (a
former plastics recycling plant) in Salinas, California.The size of the property and
building is large enough to house all of the extraction equipment and supplies of
extracts and to-be-processed “trim.” The facility is well positioned (it’s surrounded by
80+ cannabis farms), and it matches the ideal picture for cannabis extraction. The team
will invest in facility remodeling to improve the current facility conditions.
2. The Opportunity

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The cannabis industry is growing fast, and it is considered as one of the most profitable
industries in the United States.

We are building a dynamic, highly opportunistic marijuana extraction and distribution

company to tap into the fast growing cannabis industry in the United States. California
remains the largest state-market in the U.S. at $980 million, even without the approval
of recreational adult usage in the state.

We believe our initial position in California is key to the U.S. markets, especially with
predictions that market sales could hit $25 billion in 2020, and $30 billion in 2021. That
would represent compounded annual growth of about 35% over the next five years and
enable us to capture a significant market segment.

C-Quad’s ​management team understand the full potential of the market and the gaps that have
to be fulfilled to raise awareness of the cannabis extracts. The team will be completely
committed to executing all operations promptly and invest​ing in new extraction equipment if
operations requires that action and to continually invest in development and process
optimization. Our workforce is going to be well trained to operate within the framework
of our Company’s corporate culture, and also to meet the needs of all our customers.
Our extraction business will be built on a solid foundation.

The market for marijuana in California, the world’s sixth largest economy, is expected to
reach $3.7 billion this year and more than $5.1 billion in 2019, according to research
firm BDS Analytics. Cannabis oil consumption is estimated to grow 100 times faster
than dried marijuana consumption. Many cannabis growers do not have the equipment
or expertise to deliver a highly consistent, branded, end-product to their customers,
thereby leaving a critical void in the market, which our Company aims to capture. More
medical marijuana providers are processing 100% of their harvests into concentrates,
while some hash makers have moved on to greener pastures with more control over
their source material as well.

● $5B - The potential size of the marijuana market in California after legalization
(Source: Cowen).
● $325M - The amount of fundraising this year by cannabis startups
(Source: AgFunder).
● $21.6B - Estimate of legal spending on marijuana products in 2021
(Source: ArcView).

Given the boom in popularity of concentrates in recent years, there’s been a natural
increase in both the number of producers and the profits involved. Sales figures can be
much higher for larger, more established companies. Currently, a lot of concentrates are
stuck in the 70-80% THC potency range, but some producers are claiming they have
the technology to get up to 95-99% potency. Companies are going to be constantly on
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the lookout for ways to improve their processes and maximize their returns on the
cannabis plants they use.

Customers Demand

Our Po
We will offer the care, comfort, fun and safety to children
enrolled in First Step Daycare. Each day will bring them an exciting new adventure, and
our teachers
Why us?

o Continue to use and improve upon key factors that ensure marijuana
extractions are consistent and stable
o Ability to “remediate” pesticides and other contaminants from our oils, which
means lower cost to obtain “trim” for processing
o Our product will be regularly tested to prove 100% high quality of our product
o High-end concentrates
o Knowledge and experience in dealing with extraction operations
o Awareness and expertise of the management team
o Best price and quality relations
o State-wide licensing for distribution
o Expansive, existing distribution networks
o Customer service
o Online and offline sales through our partner networks to save capital from
opening dispensaries

Investment Requirements

C-Quad ​is seeking $30M for the implementation of the first strategic phase. The
Company will maintain high levels of revenue afterward and have sufficient funds for
acquiring equipment and paying startup costs for setting up business operations. The
funding will enable the Company to implement aggressive sales and marketing plans.
The Company anticipates that the initial round will be sufficient to carry it to profitability
and allow building assets to
a level where outside debt
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financing can be obtained to fund further growth, if required. The generated funds will
be reinvested in the company. As the exit strategy, ​C-Quad ​may seek to sell the
business in Year 5 to a third-party for a significant revenue multiple (10x plus). Based
on start-up multiples, the business could acquire a conservative multiple of 3.0x
revenues, giving investors the opportunity of obtaining a return on investment (ROI) well
over initial capital invested in a period of five years.

Equity value at exit in year 5

(100%) $435,854,880
Cost for investor 3
Value for investor $16.89
Average multiple 3
Profit is 145.28 higher than initial
investment 145.28
Equity 15%
$65,378,232.0
Value for investor 0

Investment Metrics (US $ Million)

Equity value et exit in year 5
(100%) $112.6
Cost for investor 0.12
Value for investor $16.89
Profitability 145.28

Year 1 Year 2 Year 3 Year 4 Year 5

Sales $49,672,560 $145,284,960 $145,284,960 $145,284,960 $145,284,960
Operating
Costs $7,942,224 $9,064,224 $9,874,224 $11,089,224 $12,911,724
EBITDA $40,530,336 $136,220,736 $135,410,736 $134,195,736 $132,373,236
Taxes Interest
and
Depreciation $5,320,620 $19,662,480 $19,662,480 $19,662,480 $19,662,480
Net Profit $33,247,216 $114,595,756 $113,785,756 $112,570,756 $110,748,256

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3. About the Company

Mission Statement

Our mission is to establish a first-class medical extraction and sales company selling
only the best quality and affordable prices.

Our Vision

Our vision is to develop a more professional ecosystem within the cannabis industry,
creating a better work environment for our clients, as well as creating improved patient
experiences, and a clear choice for investors in the sector.

Company Overview

C-Quad is focused on the extraction of cannabis

oil and concentrates. The primary products focus
is on C0​2 extraction techniques. C-Quad will
expand throughout California and bring its array
of services to each new state that legalizes the
use of cannabis. We strive to manufacture an
ultra-refined, full-spectrum cannabis extract (oils
and concentrates). C-Quad was created out of
necessity for pure, balanced, and consistent
cannabis-infused products produced with the
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highest quality standards. C-Quad extracts oil using a supercritical CO​2​ extractor.

All products are tested to ensure clean, potent, and pure cannabis oil and concentrates
with a full-spectrum of cannabinoids and terpenes present. Utilizing industry-leading and
novel techniques in a safe and controlled setting, C-Quad delivers the most consistent,
high-quality cannabis extracts available on today’s market. C-Quad aims to move the
extraction process out of the hands of low-scale amateurs and into the hands of
large-scale professionals in a controlled setting under the supervision of trained and
experienced chemists. We believe in the broad application of cannabis-based
medicine.

C-Quad strives to raise the standard for marijuana concentrates everywhere, and we
are entering the market to disrupt it. C-Quad is dedicated to ensuring the highest
possible quality of oils and concentrates. We strive to create a safe and consistent
product regardless of the type of oil or concentrate desired. By utilizing our proprietary
processing methods established in our state of the art facility and using our high-quality
equipment, we can deliver a final product that is refined with unmatched quality, at a low
cost.

Our production team understands the importance of patience in the extraction process,
which is necessary to ensure the highest quality concentrates that will be delivered to
the marketplace. Our team is always committed to improving their craft through
technological advancements in instrumentation and processes. We continuously
dedicate ourselves to research and development of concentrates and infused products.
We are proud to consider our company as the most innovative and original concentrate
production facility in California.

Company Details

Business name C-Quadrant, LLC

Legal form of ownership California limited liability company
Business address 3443 South Sheffield Road
Santa Ana, CA 92704
Telephone
Business website
Main contact name (Promoter) Jeremy Johnson
Main contact telephone and email address

Promoters and Shareholders

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Name of the Business Role Number of Shares Shareholdings and
shareholder or cash investments
promoter up to date
1. Todd Johnson

2.​ ​Jeremy Johnson

3. ​Michael Gregory

Legal Status

C-Quad ​is a company with limited liabilities.

Advisors

Advisor Name Address E mail address Phone number

Financial
advisor

Legal advisor

The Equipment

The extraction equipment will be able to rapidly scale the manufacture and remediation
of premium cannabis oil to supply the growing demand for cannabis concentrates in the
state of California. The equipment utilizes a closed-loop system to produce high-quality
oil in a high throughput system with minimal maintenance and labor. This equipment will
immediately allow for high-volume and highly pure extraction production.

We are excited to begin creating unique extraction products that are very high in quality.
The chosen method of extraction is safe, non-pressurized, reliable, and easy to use.
Innovation is a core part of our mission. We will continually be working to improve,
perfect, and discover all aspects of marijuana concentrate production.

The company is dedicated to improving its extraction efficiencies through investment in

state of the art extraction technology and continuous process innovation. The company
aims to become industry-leading extraction and cannabis extraction seller-based
California. The team sees a bright future in oils, as it is investing significantly in
production capacity.

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The Extraction Processes

In recent years, concentrated extracts of cannabis plants (e.g., shatter, crumble,

budder, wax, oil) have become very popular because they allow many convenient
routes of administration that are preferable to smoking the plant directly. Concentrates
are viscous and frequently very sticky substances that can be produced by extraction
with such solvents as petroleum hydrocarbons (e.g., propane, butane, hexane,
petroleum ether, naphtha), subcritical or supercritical CO​2​, and alcohols (e.g., ethanol,
isopropanol). Extraction is followed by solvent evaporation, which yields the “pure” and
very potent concentrate. Since unwanted plant waxes, fats and chlorophyll are also
extracted, an additional “winterization” step may be necessary. This step involves
re-dissolving the extract in ethanol at approximately 1:5 ratio, freezing at -40 degrees
Celcius for at least 24 hours, filtering out the resulting precipitation of unwanted
components and removing ethanol by evaporation.

Main Extraction Methods

Except for subcritical and supercritical CO​2​, the above-mentioned solvents are
flammable. Since their vapors are heavier than air, they can collect near the floor of an
incorrectly ventilated room and explode. Special precautions are, therefore, always
necessary when working with these substances.

Location and Facilities

Our corporate office is located at 3443 South Sheffield Road in Santa Ana, CA 92704;
and our operating plant is located at 20800 Spence Road in Salinas, CA 93908, in the
heart of the “salad bowl,” surrounded by ~84 marijuana farms.

Goals and Key to success

● To produce oils at a low cost due to economies of scale and remediation

techniques
● To achieve gross revenue of $127.4 million
● To get $7.5 value of Distillate per ML
● To use high-quality extraction techniques, along with lighting and modern
equipment
● To decrease energy production while maintaining a consistent environment

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 ● To capitalize on community-driven marketing opportunities by providing
educational events and show the positive sides of cannabis.

Objectives

o Get permits and licenses

o To meet compliance standards
o To talk to our potential investors and possibly seek for other investors to see our
options
o To train employees
o Conduct all testing protocols

Market Analysis

California was the first legal state marijuana market, and it represents a commanding
68% of the national total. The California addressable market remains largely untapped.

A report from the cannabis industry research firm BDS Analytics estimates sales of
cannabis to hit $3.7 billion by the end of 2018 alone, and it predicts that number will
increase to $5.1 billion in 2019 as more dispensaries come online. For comparison,
beer sales in California hit $5 billion in 2017, according to industry research group IBIS
World.

California — the world’s sixth largest economy with a population of close to 40 million —
will be a huge chunk of the total market for cannabis in North America. Legal marijuana
sales hit $9.7 billion across the seven (7) states where recreational marijuana is legal,
excluding California and Canada, in 2017 alone according to BDS. That number is
expected to hit $24.5 billion in sales by 2021, despite continued federal prohibition.

On top of that, the price of “pot” is expected to increase up to 15% as California applies
a new excise tax on recreational sales. According to Green State, the price of an
eighth-ounce of marijuana — now around $54 including tax — is approximately $65,
though local municipalities may levy different fees.

According to a study by the University of California Agricultural Issues Center (UCAIC),

California’s recreational cannabis market could be worth more than $5 billion; however,
the benchmark will only be achieved once cannabis consumers fully embrace the
state’s legal market.

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The $2.7 billion legal marijuana sales are expected to grow more than 18% annually to
hit $5.6 billion by 2020. (Arcview Group)

According to the UCAIC, about 29% of cannabis consumers may, at first, stay in the
illicit market to avoid the costs of new regulations, which will add 15% to retail values.

After the state adopts regulations, legal recreational use will make up 61.5% of the
overall market, illegally purchased marijuana will make up about 29.5% of the market,
and legal medical marijuana use will be about 9% of the overall market, the analysis
estimated.

According to a report recently released by the California Growers Association,

representing mainly small-scale growers across the state, fewer than 1% of growers
have been licensed so far. That’s a measly 534 licensed growers out of an estimated
68,000 in the state.

California accounted for 27% of the 2016 legal market in North America, Colorado
represented 20%, and Washington represented 11%.

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60% of ​the U.S. population (30 states and the District of Columbia) now lives in states
that have legalized some form of cannabis use and sales, illustrating the rising
acceptance of cannabis nationwide and highlighting the industry’s immense potential for
future growth. Arcview Market Research forecasts growth will reaccelerate beginning in
2018, as adult use sales ramp up in Canada, California, and Massachusetts along with
medical sales in Florida. The passage of initiatives in California, Nevada,
Massachusetts, Maine, Florida, Arkansas, Montana, North Dakota, and West Virginia
will add $7.4 billion to the 2021 market forecast.

Legal cannabis sales are predicted to hit $9.7B in North America in 2017, according to a
new report from cannabis industry analysts Arcview Market Research, in partnership
with BDS Analytics. That represents an unprecedented 33% increase over 2016.

The report further predicts the entire legal cannabis market to reach $24.5B in sales – a
28% annual growth rate by 2021 – as more states legalize marijuana for recreational
use and existing markets mature. Of the top 10 markets, three already have adult use
sales (Oregon, Washington, and Colorado), three have just won legalization elections
(California, Massachusetts and Nevada), and four more (Michigan, Maine, Florida and,
Arizona) are expected to have implemented adult-use programs in the next five years.

Cannabis Legal Sales in North America

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The current potential market risks include:

• federal enforcement actions and policy implementation and local ordinances and
regulatory limits or changes
• pushback from politicians
• lack access to banking services
• tax accounting restrictions
• competition from illegal market sources
• new entrants to the business
• lack of publicly available data

Competition Analysis

Approximately 250 businesses have been awarded licenses for small cultivation.
However, 10 of those businesses control about 30% of the licenses awarded. Two
cultivators — Honeydew Farms, LLC and Central Coast Farmer’s Market Management,
LLC — have been awarded about 30 licenses each.

Cultivators that hold a large number of licenses may be stacking them to run large
operations. A trade association that represents the cannabis industry has filed a lawsuit

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arguing that this is a threat to the new recreational marijuana industry that voters meant
to encourage when they passed Proposition 64.

Local competition

● 420 Extractions is a full-service cannabis extraction company. The company offers the
processing of cannabis into dabs, shatter, wax, or crumble via extracting the essential
oils from the plant.

● Based in Colorado, ​710 Labs is an extraction company that specializes in butane

extractions (BHO). The company took second place at the 2014 Cannabis Cup in the
People’s Choice Cup for their Jilly Bean shatter.

● Paradigm Cannabis Group​ provides wholesale medical cannabis and CO​2 extracted
concentrates, oil, shatter, and waxes to vapor pen manufacturers, dispensaries and
edibles manufacturers throughout California.

● Xtractology​ is a Northern California based MMJ Collective. They specialize in

cannabinoid extraction with a focus on terpene retention. They most often utilize light
hydrocarbon extraction methods and further polish utilizing other purification procedures.
All of their extracts are extremely flavorful when properly administered.

Non-local competition

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 ● CannaRoyalty​ (CSE: CRZ) (OTC: CNNRF) has extraction as one of its primary focus
areas, which also include research, testing, branding and distribution. CannaRoyalty has
assembled a portfolio of royalty ​agreements​, equity interests and other investments and
licensing agreements in the United States and Canada. The company shared a ​highly
informative presentation​ of its businesses in November. With respect to extracts, the
company earns royalties on products sold by MüV, which include a vape pen and
cartridges. It recently announced the acquisition of Kaya Management, the
manufacturer of Bhang vape pens in California (​described in this presentation​). It also
has a licensing agreement with AbsoluteXtracts of California to expand its brand to
Washington and Canada. Wholly-owned DreamCatcher Labs produces cartridges. The
company is also a joint venture partner with Rich Extracts in Oregon, thought that deal
hit a recent roadblock when the CEO of that company was arrested for drug trafficking.
Finally, it is developing The Terpistry, which will focus on creating a platform targeting
extract-based product.

● Quadron Cannatech​ (CSE: QCC) (OTC: QUDCF) is a Canadian company focused on

automated extraction and processing solutions. It is creating a closed system, with
proprietary cartridges (that don’t interchange with other devices but require the purchase
of a specific device instead). This strategy could limit the company’s potential, though it
has named a few customers recently. Its Cybernetic unit provides the intellectual
property for automation and process manufacturing and serves over 40 clients. Soma
Labs Scientific creates CO​2 supercritical extraction systems and generates revenue from
a three-year research agreement with Odorchem (which sells odor neutralizer products).
It hopes to have two mobile units in the field by the end of 2017. Greenmantle Products
is going to be providing customized vaporization devices in Canada and the United
States. It has forged a distribution relationship with Lucid Labs in Washington.

Pricing Strategy

We are going to be offering our products at cheaper prices than our competitors do, but
in no way does this translate to sub–standard products. Selling our products at a lower
price than what is obtainable in our competitors’ stores means that we will only reduce
our profit margin and gain sales margin.

Payment Options

Our payment policy is all inclusive because we are quite aware that different people
prefer different payment options as it suits them. Here are the payment options that will
be available in all of our outlets;

· Payment by cash
· Payment via Point of Sale (POS) Machine
· Payment via online bank transfer (online payment portal)
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· Payment via Mobile money
· Check (only from loyal customers) In light of the above, we have chosen banking
platforms that will help us achieve our payment plans without any hitches.

Competitive Edge

Our longtime ties to the cannabis community grant us leverage in all aspects of the
business.

● Distribution agreements
● Equipment, supply and product testing
● Marketing and promotion agreements
● Partnerships

SWOT Analysis

STRENGTHS
o Facility and equipment
o High-quality concentrates
o Management team connections in
the industry
o Competition is very minimal at this
point
WEAKNESSES
o Making new entrance on the market
o Location may be far for some
employees
o Our weakness is we are at the early
stages of the business

o OPPORTUNITIES
o We are working with an experienced
project manager who helps and
guides us through the process.
o Learning from our weakness and the
ability to adapt to the current market
o THREATS
o Over time there will be more
competitors and we will uphold our
competitive advantage and keep our
customers and maintain them before
new competitors join the market
o Other companies in the market
already being stable and expanding
o Regulatory Reliance
o Changes in Regulatory Environment
o Limited Operating History –
Manufacturing Risks
o Dispensaries – The Black Market

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Growth drivers

1. Proper financing.
2. Seasoned and professional management services.
3. Legal compliance and professionalism establishing standards and best practice.
4. Growth strategies that maximize returns for both short-term and long-term
stakeholders and shareholders, allowing for advanced succession planning and an exit
strategy.

Operational Processes Map

Security

Non-Employee, non-customer visitors must hold and display an identification badge and
log their time of arrival, departure, and purpose of visit in a record that’s preserved for
three years. A security alarm system will cover all points of entry and perimeter
windows. We will use motion detectors, pressure switches, duress and panic buttons,
and hold-up alarms.

Extraction Process

Unlike BHO, carbon dioxide (CO​2​) is considered safe by the FDA which has made it a
more desirable solvent among extractors in the cannabis community. The solvent is
also non-toxic and the process doesn’t contribute to carbon emissions in the
atmosphere. This method uses a specific combination of high temperature and pressure
to create phase changes in the CO​2​. Controlling the temperature and pressure allows us
to create a multitude of end products, making CO​2​ a “tunable” solvent. The phase
changes are used to “drop out” the undesirables from the plant material. Some
CO​2​ machines and methods are able to extract and separate multiple compounds from
the plant, but it does take a more finely tuned set of equipment and experience to
harvest both terpenes and cannabinoids.

Lab testing

In keeping with our protocols for the highest standards, all concentrates will be full
spectrum lab tested.

Customer Service

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Our customer service will be available 24/7 via chat and email to help usurer and cater
to their requests.

Risk Minimizing

Managing Members take minimal salary.

Costs

We will work towards minimizing any unnecessary cost; that way we will be able to
generate higher net margin in the first business year.

Accounting

We will hire an accountant that will regularly monitor our financials and signalize if some
financial difficulties may occur.

Tax administration

We will regularly pay our taxes and ensure that our business operations are transparent
to any Government body or legal advisors outside the company​.

Milestones

To achieve the growth and marketing goals that have been outlined in this business
plan, the Company has deadlines to meet and ideas to implement. Some of these are
described below:

Feb Mar Apr May Jun Jul Aug Sep

Milestone 1 Secure Start-up capital February 15-25, 2018

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Milestone 2 Renovate the Facility March 1-30, 2018
Milestone 3 Ordering Equipment March 15-25, 2018
Milestone 4 Equipment’s Delivered March 30, 2018
Milestone 5 Employees Hired and Trained April 5-May 5, 2018
Milestone 6 Start Marketing Strategy May 15-June 25, 2018
Milestone 7 Start the Sales Jun10-20, 2018
Increase the number of
Milestone 8 September 1-30, 2018
customers

Strategic Alliances

Exit Strategy

Mergers and Acquisitions

Sell controlling interest in the business to another entity but may assume day-to-day
operations.

IPO

Another way of resolving financial difficulties is to sell company’s shares of stock to the
public.

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Marketing

The marketing and sales strategy of the company will be based on generating long-term
personalized relationships with customers. In summary the company will adopt the
following sales and marketing approach to win customers over;

· Introduce our business by sending introductory letters to residence, business owners

and organizations and create a website with all the information about the company,
product, processes, equipment, accomplishments and founders.
· Leverage on the internet to promote our business
· Engage in direct marketing
· Leverage word of mouth marketing (referrals)
· Enter into business partnership with hospitals, health care provider and health
insurance companies.
· Attend pharmaceutical related exhibitions / expos
We are going to explore all available conventional and non – conventional means to
promote our retail business.
· Sponsor relevant community programs
· Leverage on the internet and social media platforms like; Instagram, Facebook ,
twitter, YouTube, Google + et al to promote our brand

Management Team

Key personnel:

Michael Gregory

Todd Johnson

Jeremy Johnson

Employee number and working hours

Designation Number of employees Weekly working hours

Chief Manufacturing Officer TBD TBD
Chief Science Officer TBD TBD

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Extraction Manager TBD TBD
Extraction Team TBD TBD
Distillation Manager TBD TBD
Distillation Team TBD TBD
Retail and RD Manager TBD TBD
RD Lab Tech TBD TBD
Retail Team TBD TBD
Reception TBD TBD
Accounting Manager TBD TBD
Accounts Receivable TBD TBD
Accounts Payable TBD TBD
Secretary TBD TBD
Sales Manager TBD TBD
Phone Sales TBD TBD
Compliance Manager TBD TBD
Compliance Clerk TBD TBD
Facility Manager TBD TBD
Repair Tech TBD TBD
Will Call coordinator / Dispatch TBD TBD
Delivery Driver / Class B TBD TBD
Total TBD TBD

Employee specification for period of five years

Designation Number of Number of Number of Number of Number of

employees employees employees employees employees
in 2018 in 2019 in 2020 in 2021 in 2022
Chief Manufacturing
TBD TBD TBD TBD TBD
Officer
Chief Science Officer TBD TBD TBD TBD TBD
Extraction Manager TBD TBD TBD TBD TBD
Extraction Team TBD TBD TBD TBD TBD
Distillation Manager TBD TBD TBD TBD TBD
Distillation Team TBD TBD TBD TBD TBD
Retail and RD TBD TBD TBD TBD TBD
Manager
RD Lab Tech TBD TBD TBD TBD TBD
Retail Team TBD TBD TBD TBD TBD
Reception TBD TBD TBD TBD TBD
Accounting Manager TBD TBD TBD TBD TBD
Accounts Receivable TBD TBD TBD TBD TBD
Accounts Payable TBD TBD TBD TBD TBD
Secretary TBD TBD TBD TBD TBD
Sales Manager TBD TBD TBD TBD TBD
Business Plan
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Phone Sales TBD TBD TBD TBD TBD
Compliance Manager TBD TBD TBD TBD TBD
Compliance Clerk TBD TBD TBD TBD TBD
Facility Manager TBD TBD TBD TBD TBD
Repair Tech TBD TBD TBD TBD TBD
Will Call coordinator / TBD TBD TBD TBD TBD
Dispatch
Delivery Driver / Class TBD TBD TBD TBD TBD
B
Total TBD TBD TBD TBD TBD

Financial Analysis

Startup Costs

BUILDINGS/REAL ESTATE
Buildings
Purchase 20800 Spence Rd Salinas, CA 93908 $6,000,000
Purchase 25600 Encinal Rd Salinas, CA 93908
Purchase LCG Business Enterprises $7,000,000
Construction $1,250,000
Total $14,250,000

CAPITAL EQUIPMENT LIST

Furniture $125,000
Extraction $2,750,000
Distillation $3,000,000
Remediation $3,500,000
Retail Products $750,000
Total $10,125,000

LOCATION AND ADMIN EXPENSES

Rental house traveling contractors $45,000
Utility deposits $5,000
Legal and accounting fees $30,000
County Licensing $35,000
Pre-opening salaries Team leads and CSO $200,000
Contingency Budget $725,000
Total $1,040,000
Business Plan
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ADVERTISING AND PROMOTIONAL
Advertising $25,000
Signage $5,000
Packaging $1,500,000
Call Center Engagement $55,000
Other/additional categories $0
Total $1,585,000
Summarized Startup Costs Per Category
BUILDINGS/REAL ESTATE $14,250,000
CAPITAL EQUIPMENT LIST $10,125,000
LOCATION AND ADMIN EXPENSES $1,040,000.00
ADVERTISING AND PROMOTIONAL $1,585,000
TOTAL STARTUP COSTS $27,000,000

Cash Flow Statement

Cash Flow Statement

Year 1 Year 2 Year 3 Year 4 Yea
$122,342,97 $221,878,72
Beginning Cash $400,000 $21,997,216 2 8 $320,199,4
$33,247,21 $114,595,75 $113,785,75 $112,570,75
Net Income 6 6 6 6 $110,748,2
Operating Activities, Cash Flow Provided by or $33,247,21 $136,592,97 $236,128,72 $334,449,48
Used In 6 2 8 4 $430,947,7
Adjustments to Net Income
Depreciation $1,962,500 $1,962,500 $1,962,500 $1,962,500 $1,962,5
$38,567,83 $134,258,23 $133,448,23 $132,233,23
Income Tax 6 6 6 6 $130,410,7
$33,247,21 $136,592,97 $236,128,72 $334,449,48
Total Cash Flow from Operating Activities 6 2 8 4 $430,947,7
Investing activities, Cash Flows provided or Used
In
Owner’s Investment
Investment Received $3,000,000
-$14,250,00
Capital Investment 0 -$14,250,000 -$14,250,000 -$14,250,000 -$14,250,0
$21,997,21 $122,342,97 $221,878,72 $320,199,48
Total Cash Flow from investing Activities 6 2 8 4 $416,697,7
Financing Activities, Cash Flows Provided by,
Used For
Dividends Paid
Sales/Purchase of Stocks
Net Borrowings
$21,997,21 $122,342,97 $221,878,72 $320,199,48
Total Cash from Financing Activities 6 2 8 4 $416,697,7

Business Plan
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 $21,997,21 $122,342,97 $221,878,72 $320,199,48
Total Changes In Cash 6 2 8 4 $416,697,7

Profit and Loss

$2,018 $2,019 $2,020 $2,021 $2,022
Sales Revenue
Cultivation Sales $14,801,760 $14,801,760 $14,801,760 $14,801,760 $14,801,760
Cultivation Oils Extraction $3,000,000 $3,000,000 $3,000,000 $3,000,000 $3,000,000
Clone Sales $0
Manufacturing Sales $31,870,800 $127,483,200 $127,483,200 $127,483,200 $127,483,200
Cost of Revenue $0
Total Sales Revenue $49,672,560 $145,284,960 $145,284,960 $145,284,960 $145,284,960
Materials and supplies (in COGS) $1,200,000 $0 $0 $0 $0
Gros revenue $48,472,560 $145,284,960 $145,284,960 $145,284,960 $145,284,960

Expenses:
Advertising $30,000 $30,000 $30,000 $30,000 $30,000
Commissions and fees $4,440,528 $4,440,528 $4,440,528 $4,440,528 $4,440,528
Cultivation Labor $0
Custodial Service $0
Insurance (other than health) $0
Manufacturing Management $0

Materials and supplies (in COGS) $0

Manufacturing trim cost $0
Mortgage interest $0
Office expense $1,742,892 $1,742,892 $1,742,892 $1,742,892 $1,742,892
Other interest expense $0
Pension and profit-sharing plan $0
Purchases for resale $0
Rent or lease $696,000 $696,000 $696,000 $696,000 $696,000
Rent or lease: vehicles, equipment $52,800 $52,800 $52,800 $52,800 $52,800
Repairs and maintenance $0
Manufacturing Solvents $0 $42,000 $42,000 $42,000 $42,000
Utilities $240,000 $240,000 $240,000 $240,000 $240,000
Wages (less emp. credits) $0
Manager Salary $200,004 $200,004 $200,004 $200,004 $200,004
Security $540,000 $1,620,000 $2,430,000 $3,645,000 $5,467,500
Other expenses $0
Miscellaneous $0
Total Expenses $7,942,224 $9,064,224 $9,874,224 $11,089,224 $12,911,724

Business Plan
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EBIDTA $40,530,336 $136,220,736 $135,410,736 $134,195,736 $132,373,236
Depreciation $1,962,500 $1,962,500 $1,962,500 $1,962,500 $1,962,500
NET PROFIT BEFORE TAX $38,567,836 $134,258,236 $133,448,236 $132,233,236 $130,410,736
Taxes
Taxes and licenses $4,780,620 $19,122,480 $19,122,480 $19,122,480 $19,122,480
Taxes for Cultivation $540,000 $540,000 $540,000 $540,000 $540,000
Cumulative Profit (Loss) $33,247,216 $114,595,756 $113,785,756 $112,570,756 $110,748,256

Balance Sheet
Balance Sheet
Year 1 Year 2 Year 3 Year 4 Year 5
Assets
Currents Assets
Cash $38,209,716 $138,555,472 $238,091,228 $336,411,984 $432,910,240
Prepaid Expenses $38,567,836 $134,258,236 $133,448,236 $132,233,236 $130,410,736
Total current assets $76,777,552 $272,813,708 $371,539,464 $468,645,220 $563,320,976

Fixed Assets
Long term debt
Capital Assets
Equipment $14,250,000 $26,537,500 $38,825,000 $51,112,500 $63,400,000
(less accumulated
depreciation) -$1,962,500 -$1,962,500 -$1,962,500 -$1,962,500 -$1,962,500
Total Net Fixed Assets $12,287,500 $24,575,000 $36,862,500 $49,150,000 $61,437,500

Total Assets $89,065,052 $297,388,708 $408,401,964 $517,795,220 $624,758,476

Liabilities
Short Term Liabilities
Accounts Payable
Depreciation $1,962,500 $1,962,500 $1,962,500 $1,962,500 $1,962,500
Taxes Payable $38,567,836 $134,258,236 $133,448,236 $132,233,236 $130,410,736
Total current Liabilities $40,530,336 $136,220,736 $135,410,736 $134,195,736 $132,373,236

Equipment $12,287,500 $24,575,000 $36,862,500 $49,150,000 $61,437,500

Total Liabilities $12,287,500 $24,575,000 $36,862,500 $49,150,000 $61,437,500

Shareholders’ Equity
Working Capital $3,000,000 $21,997,216 $122,342,972 $221,878,728 $320,199,484
Owners Capital
Retained Earnings $33,247,216 $114,595,756 $113,785,756 $112,570,756 $110,748,256
Total Shareholders’
Equity $36,247,216 $136,592,972 $236,128,728 $334,449,484 $430,947,740

Total Liabilities and

Equity $89,065,052 $297,388,708 $408,401,964 $517,795,220 $624,758,476

Revenue Model

Business Plan
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 Forecasted Year     $2,018  $2,019  $2,020  $2,021  $2,022 
ASSUMPTIONS:
Annual Growth    
Cultivation Sales  $14,801,760  $14,801,760  $14,801,760  $14,801,760  $14,801,760 
Cultivation Oils Extraction     $3,000,000  $3,000,000  $3,000,000  $3,000,000  $3,000,000 
Clone Sales     $0  $0  $0  $0  $0 
Manufacturing Sales     $31,870,800  $127,483,200  $127,483,200  $127,483,200  $127,483,200 
$49,672,56 $145,284,96 $145,284,96 $145,284,96 $145,284,96
Total Revenue 0 0 0 0 0

Depreciatio
n

Years 5 Equipment
Buildings $ 14,250,000 $ 14,250,000 $ 14,250,000 $ 14,250,000 $ 14,250,000
Equipment $ 10,125,000 $ 10,125,000 $ 10,125,000 $ 10,125,000 $ 10,125,000

Total $ 1,962,500 $ 1,962,500 $ 1,962,500 $ 1,962,500 $ 1,962,500

Business Plan
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