Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...

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Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
A vertically integrated cannabis company providing recreational and
                                                 medical marijuana based products through our leading retail stores

                                                                                       Shareholder Presentation
                                                                                                       August 2018

Unless otherwise stated all amounts are in USD                                                                         1
Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
Disclaimer
This presentation (together with any supplements and any other information that may be furnished to prospective investors by Captor Capital
Corp contains “forward-looking statements” or “forward-looking information” within the meaning of applicable securities laws (collectively,
“forward-looking information”). Forward-looking information is generally identifiable by the use of the words “believes”, “may”, “plans”, “will”,
“anticipates”, “intends”, “budgets”, “could”, “estimates”, “expects”, “forecasts”, “projects” and similar expressions, and the negative of such
expressions. Forward-looking information in this presentation includes, but is not limited to, statements concerning economic trends, the size of
the market, the timing and scope of Captor Capital Corp capital expenditures, the anticipated use of proceeds, financial forecasts, and the
proposed ownership allocation.

Captor Capital Corp has based this forward-looking information on factors and assumptions about future events and financial trends that it
believes may affect it’s financial condition, results of operations, business strategy and financial needs, including the ability of Captor Capital
Corp to generate cash flow from operations and obtain necessary financing on acceptable terms, general economic, financial market, regulatory
and political conditions in which Captor Capital Corp operates, consumer interest in Captor Capital Corp products, competition, anticipated costs,
government regulation of Captor Capital Corp activities and products and in areas of taxation and environmental protection, the timely receipt of
any required regulatory approvals, and Captor Capital Corp ability to obtain qualified staff, equipment and services in a timely and cost efficient
manner. While Captor Capital Corp considers these assumptions to be reasonable, these assumptions are inherently subject to significant
uncertainties and contingencies. Additionally, there are known and unknown risk factors which could cause Captor Capital Corp actual results,
performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the
forward-looking information contained herein. Known risk factors include, among others, regulatory risks, the lack of a public market for the
securities of Captor Capital Corp, the limited operating history and financial track record of Captor Capital Corp and the uncertainty as to
revenues, reliance on key personnel, product liability, unfavourable publicity, management of growth and the difficulty in forecasting.

 Unless otherwise stated all amounts are in USD                                                                                                       2
Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
Table of Contents

   § About Captor

   § Our Strategy

   § Cannabis market

   § Our Pipeline

   § Our Performance

   § Our Team

Unless otherwise stated all amounts are in USD   3
Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
About Captor Capital Corp
                                                 • Captor Capital Corp. (“Captor”) is a vertically integrated cannabis company
                                                   providing recreational and medical marijuana based products to consumers via
                                                   its leading brands and dispensary locations.

                                                 • Listed on the Canadian Securities Exchange, the OTC USA, and the Frankfurt
                                                   Stock Exchange, Captor owns and operates advanced growing facilities which
                                                   produce consistent high quality contaminant free marijuana for its customers, as
                                                   well as other high demand cannabis based goods for consumption.

                                                 • Through ownership of top brands and high value dispensary locations, Captor’s
                                                   revenue is expected to exceed a run rate of $45 million, without considering
                                                   future acquisitions.

                                                 • Furthermore, Captor seeks to capitalize upon the combination of its intellectual
                                                   property and extensive network of industry relationships to provide its customers
                                                   with a wide variety of products, and a best in class experience.

Unless otherwise stated all amounts are in USD                                                                                         4
Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
The Captor Strategy
                                                                     • To efficiently engage Captor’s well defined and deep pipeline of cultivation and dispensary targets,
                                                                       acquire them at favourable prices, and unlock the intrinsic value of these companies through
                                            Acquire                    operational enhancements.
                                           Profitable
                                         Operations at
                                          Favourable                 • The primary strategic focus of Captor is to acquire profitable, established cannabis focused
                                            Pricing                    companies that require capital to scale.

            Expand
          Geographies
                                                                     • Target investments will be top quality operations with experienced management and defined
                                                          Identify
          and Product                                    Synergies     business plans.
           Offerings

                                       Robust &                      • Acquisitions will be selected based off of synergy, possibly with current existing brands, locations,
                                                                       and operations.
                                       Consistent
                                      Shareholder                    • Upon acquisition the investments will be integrated and supported to enhance operations and
                                        Return                         profitability.
              Expand                                     Integrate
             Team and                                    Ops and     • Expand team of experienced operators to support organic growth.
            Intellectual                                  Achieve
              Property                                   Synergies
                                                                     • Initial geographic focus will be on California and Nevada as these are high growth markets, with
                                                                       large populations and direct synergies.
                                             Deploy
                                            Capital to
                                                                     • Captor will continue to expand its geographic footprint as the industry evolves legally within the
                                             Scale
                                                                       USA, and potentially internationally, depending on the regulatory framework.

                                                                     • The management team at Captor believe that having a controlled scaling with a primary focus on
                                                                       profitability will lead to a consistent and robust shareholder return.

Unless otherwise stated all amounts are in USD                                                                                                                                 5
Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
Market

Unless otherwise stated all amounts are in USD   6
Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
The Current Cannabis Market

                                                                                                       Source: Marijuana Business Factbook 2017

                                                    Marijuana Legalization Status

                                                                        Medical marijuana broadly legalized
                                                                        Marijuana legalized for recreational use
                                                                        No broad laws legalizing marijuana
                                                                        Source: www.governing.com

Unless otherwise stated all amounts are in USD                                                                                                    7
Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
California Cannabis Market
                                                           Formalizing the informal market alone is a $24 billion opportunity*

                                                                      California's population is more than 3x larger than
                                                                          Colorado and Washington State combined.

                 Microbusiness          Tes4ng
    Delivery          3%                  1%                                                                                       Percentage of total sales
      3%
                                                                                                                                                   2019 Estimate
                     Retailer                                                                        $6 Billion
                       7%                                                                              Legal

             Dispensary
                 9%
                                                     Cul4vator
                                                       49%
           Distributor
              12%
                                                                                        $24 Billion
                                                                                       Black Market
                      Manufacturer
                         16%

               California marijuana licenses by activity                  *2016 cannabis report from the Cowen Group             Source: University of California
                                                                                                                                   Agricultural Issues Center

Unless otherwise stated all amounts are in USD                                                                                                                      8
Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
California Cannabis Licensing
                                                 Reviewing the data in the Cannabiz Media Licensing Database reveals some interesting
                                                 facts about California marijuana licenses that help to paint the picture of how the state’s
                                                 marijuana marketplace is developing. Here are some key facts:

                                                 • There are 1,780 license holders in total in California.

                                                 • 13 companies account for 10% of the licenses statewide.

                                                 • The company with the most licenses is Central Coast Farmer’s Market Management, LLC with 106.
                                                   That’s 3% of all licenses in the state.

                                                 • Many license holders seem to be acquiring multiple cultivation licenses.

                                                 • Just under 900 companies have secured the 1,732 cultivation licenses.

                                                 • 15 jurisdictions account for half of all licenses

                                                    o   Oakland, Los Angeles, Sacramento, San Francisco, Carpinteria, Salinas, Buellton, Eureka, San
                                                        Jose, Arcata, Santa Barbara, Cathedral City, Desert Hot Springs, Lynwood, and Santa Rosa.

                                                 • 1 jurisdiction accounts for nearly 1 in 10 licenses in the state – Oakland (282 licenses).

                                                 • Three jurisdictions account for nearly 20% of licenses in the state

                                                    o   Oakland (282 licenses), Los Angeles (203 licenses), and Sacramento (139 licenses).

Unless otherwise stated all amounts are in USD                                                                                                         9
Shareholder Presentation August 2018 - A vertically integrated cannabis company providing recreational and medical marijuana based products ...
California Opportunity
                                                                     • Lots of independent stores doing well, but few retail brands being established
                                                                       across the state.

                                                                     • Customers are loyal to dispensaries that provide exceptional user experience.
  The Opportunity: By License Numbers                     RETAIL
                                                                     • Establish a network of retail dispensaries offering quality products, superior
Cul4vators                      1,732            49%                   service and expertise.

Manufacturers                   564              16%
                                                                     • Hub and spoke model supplying acquired retailers with high quality I-5 grown
Distributors                    417              12%                   products.

Dispensaries                    316              9%                  • Provide capital and management, economies of scale to targeted acquisition.
                                                         LOGISTICS
Retailers                       258              7%                  • Consolidate growers, processors, retailers.

Delivery                        112              3%
                                                                     • Mandatory testing will remove many products from marketplace.
Microbusinesses                 96               3%
                                                                     • Establish a broad regional brand for consistent and quality product.
Tes4ng                          23               1%
                                                         BRANDING    • Customers will pay a premium for a high quality, consistent product.

Unless otherwise stated all amounts are in USD                                                                                                          10
Our Pipeline

Unless otherwise stated all amounts are in USD   11
Deal Timeline – Platform for Growth

                                                            Company            LOI     Defini0ve   Regulatory   Closed
                                                                                      Agreement    Approval
                                                         Mellow Extracts                                       Pending

                                          California   MedMen (Santa Ana)                            N/A

                                                           MedMen                                    N/A
                                                         (W. Hollywood)
                                                          Chai Cannabis

                                                            Castroville

                                                       Fine Detail Greenway                                    Par4al
                                          Washington

                                                        Cascadia Gardens                                       Par4al

                                                            Mainstem                                 N/A

Unless otherwise stated all amounts are in USD                                                                           12
MedMen (Santa Ana Dispensary)
• 8,148 sq. ft. facility centrally located in Santa Ana, CA.   • Repeat patients already make up over 50% of transactions,
                                                                 looking to level out over 80%.
   o   Only city in Orange County to allow dispensaries.
   o   Orange County has over 3,000,000 inhabitants.           • MedMen dispensary patients spending $85.23 on average, on
                                                                 par with West Hollywood store, and $20 more than
• Sales in first weekend of California recreational              competitors.
  legalization were up 400% from historical weekend
  average.

• Sales during January to March 2018 was
  approximately $1.2 million.

Unless otherwise stated all amounts are in USD                                                                               13
MedMen (West Hollywood Dispensary)
• 2,010 sq. ft. facility centrally located in West Hollywood
  (WeHo), CA.

   o   Local population base of 39,000.
   o   Represents approx. 10% of LA cannabis market.

• Recreational marijuana license allowance for marijuana
  sales and small on-site cultivation.

• Market information (WeHo):

   o   Estimated medical market value (2025): US$6 million.
   o   Estimated adult-use market value (2025): US$60
       million.

• Sales during January to March 2018 was approximately $6
  million.

• Sales in first weekend of California recreational legalization
  were up 500% from historical weekend average.

• MedMen dispensary patients spending ~$85 on average,
  $20 more than competitors.

   o   Repeat patients already make up over 80% of visits.

Unless otherwise stated all amounts are in USD                     14
Capitola Healing Association Inc. (Chai)
                                                 • Revenue for the last 3 years was c.US$9 million and was
                                                   purchased for US$6.1 million.

                                                 • Chai is focused on being an elite high grade low cost
                                                   medical dispensary.

                                                 • Only sells lab tested and 100% indoor grown product.

                                                 • Consistently rated top 5 dispensaries in Santa Cruz.

                                                 • Chai is developing what will be one of Santa Cruz largest
                                                   glassware show room, focusing on:

                                                    o   Unique designs and specialty blown pieces for
                                                        connoisseurs, and
                                                    o   Largely discounted standard pieces.

Unless otherwise stated all amounts are in USD                                                                 15
Marina Caregivers Coop Inc.
                                                 • Operating for over 10 years serving Marina Del Rey, CA

                                                 • Focused on patient education to help individuals make
                                                   informed choices about cannabis

                                                 • Customer support unlike any other dispensary
                                                       - Peer support groups
                                                       - Marijuana 101 classes
                                                       - Cultivation classes
                                                       - Free chair massage days

                                                 • In 2017 sales of over $5,000,000 USD with net income of
                                                   over $2,900,000 USD (50.8% net income margin)
                                                        - 2018 sales tracking to beat previous year

                                                 • From 2016 to march 2018 assets grew 8x balanced by an
                                                   increase in equity from net income

Unless otherwise stated all amounts are in USD                                                               16
Higher Level of Care
                                                 • Offer to acquire 100% equity under LOI.

                                                    o   Asking price of $2,875,000.

                                                 • Due diligence request in progress.

                                                 • Serving multiple towns in California due to location

                                                    o   Castroville
                                                    o   Moss Landing
                                                    o   Prunedale
                                                    o   Elkhorn
                                                    o   Watsonville

                                                 • Primarily Flower Sales but with a wide assortment of
                                                   edibles, concentrates, vapes, tinctures, etc.

                                                 • Averaging $450,000 in sales per month in 2017.

Unless otherwise stated all amounts are in USD                                                            17
Mellow Extracts Lab
                                                 • Secured location in Costa Mesa, conditional use permit granted,
                                                   operations starting now.

                                                 • Permit also includes distribution license, increasing EBITDA
                                                   when distribution starts.

                                                 • USD $400,000 per month in orders.

                                                    o   Joint Ventures with Big Foot Products & Aeroinhaler pending.

                                                 • Concentrates and Extracts highest margin sector in industry at
                                                   45%+ net.

                                                 • Mellow Lab CEO served on several state committees in the
                                                   legalization process.

Unless otherwise stated all amounts are in USD                                                                         18
3863 Hannegan Road, Bellingham
• Investment: USD $285,000 + buildout Costs.                                  • Approved for capsule manufacturing.

• Captor Capital Corp. to own all LCB approved assets & IP.                   • New product line rolling out Q2 2018.

• Tier 2 license - 10,000 sq. ft. of canopy allowed, ~2,020 sq. ft. current
  utilization after expansion, first harvest in November 2017.

   o   Estimated 86,260g of dry weight harvested (before trimmings and
       loss) for sale in November 2017 at a minimum of $3.30 per gram.

 Unless otherwise stated all amounts are in USD                                                                         19
5373 Guide Meridian, Bellingham
• Investment: USD $650,000 cash + buildout costs.                              • Current location has potential to expand to nearly full 10,000 sq. ft.

• Captor Capital Corp. to own 100% of LCB approved assets & IP.                • Q2 2018 revenues expected to be approximately USD $240k per
                                                                                 month, ~31% EBITDA margin.
• Tier 2 license 10,000 sq. ft. capacity ~5,200 sq. ft. current utilization.

                                                                                                  Monthly sales
                                                                                                  from ~5,200 sq. ft.
                                                                                                  of grow space

 Unless otherwise stated all amounts are in USD                                                                                                           20
Main Stem Goods and Services
• Investment: USD $550,000 for 9.9%.                 • Joint venture with Scotts Miracle Grow.

• “Amazon” of the cannabis industry (“picks and      • Stand alone IPO expected in 2018.
  shovels”).
                                                     • No cannabis licensing needed, ability to do
• Online procurement of supplies to all levels of      business in all 50 states.
  cannabis industry.

• Main Stem CEO is also Sr. VP of the Washington
  State Cannabis Alliance.

         5+ Million                                    600+                                          400+
              Packaging Units Sold                  Business Customers                               Unique SKU’s

 Unless otherwise stated all amounts are in USD                                                                     21
Our Performance

Unless otherwise stated all amounts are in USD   22
Projected Revenue & Profits

                                                               Captor Subsidiary Income Proforma by Quarter
                                  1,60,00,000

                                  1,40,00,000

                                  1,20,00,000

                                  1,00,00,000

                                     80,00,000

                                     60,00,000

                                     40,00,000

                                     20,00,000

                                                 0
                                                     Q1 2018   Q2 2018          Q3 2018         Q4 2018          Q1 2019   Q2 2019

                                                                  Gross Subsidiary Revenue   Subsidiary EBITDA

Unless otherwise stated all amounts are in USD                                                                                       23
Stock Comparative Valuation Multiples
                                                  Captor Stock is materially undervalue based on cannabis trading mul4ples
                                                                                              Enterprise Value / LTM Sales

                                        Captor

                                   Golden Leaf

                                   Kush BoYles

                                      MPX Bio

                                   Organigram

                                    MedReleaf

                                      Supreme

                                 CannaRoyalty

                                        Aphria

                                       Canopy

                                       iAnthus

                                 Hydrothecary

                                   Marapharm

                                        Cronos

                                      MedMen

                                Emerald Health

                                                 0x           50x             100x             150x            200x             250x            300x          350x   400x   450x

Note: All data as of 30 May 2018 – Captor assuming no debt. Captor market valua4on based on es4mated stock price of CAD$0.30 and 786.9M shares outstanding.

Unless otherwise stated all amounts are in USD                                                                                                                                     24
Our Team

Unless otherwise stated all amounts are in USD   25
Management Team
                                                 A balanced and diverse team with extensive experience in cannabis and M&A

   John Zorbas                                                                                 Shawn Groshans
   President and Director                                                                      Head of Business Development

   Mr. John Zorbas is an entrepreneur with a proven track record in the metals exploration     Mr Shawn Groshans has approximately 20 years in merchant banking and corporate
   and development industry and the investment banking. He has held senior advisory            finance with experience in private equity investing, advising companies on mergers and
   positions in various facets of business including operations, marketing, sales, strategic   acquisitions, capital raising, business development, and restructuring. Subsequent to
   planning and structured finance. Mr. Zorbas has been with the Company since June            his experience in banking he took a role as Head of Business Development for a global
   2008. He also serves as URU Metals Ltd (Captor Capital investment) Chief Executive          intelligence and cyber-security firm, in addition to his involvement in entrepreneurial
   Officer since 2 June 2014. He was appointed Chairman of Management Resource                 ventures which includes the cannabis industry.
   Solutions PLC in April 2017. He also served as the President of MGM Productions
   Group Inc a company focused in media and retail investments., as well as Director of        Mr. Groshans serves as a Non-Executive Director for Tower Financial and he has
   both ZorCorp Capital Holdings and Starline Capital Holdings Infrastructure Fund. He         previously worked for Salamanca Group, Richmond Park Partners, S-RM and PwC.
   served as the Chief Executive Officer and a Director of Monchhichi PLC (former:
   Mercom Capital PLC) until 23 December 2016. Mr. Zorbas also served as a Director of
   Stratton Capital Corp. until 20 October 2016. He is a founding shareholder of Asian
   Coast Development Ltd. Mr. Zorbas holds an Honors Bachelors in Economics from the
   University of Toronto.

Unless otherwise stated all amounts are in USD                                                                                                                                           26
Management Team
                                                 A balanced and diverse team with extensive experience in cannabis and M&A

   John MacPhail                                                Oliver Summers                                         Matt Longo
   Founder and CEO of I-5 Holdings Ltd (Subsidiary of Captor)   Director of Retail Dispensaries                        Director of Manufacturing & Cultivation

   Mr. John MacPhail is most recently the founder and           Mr. Oliver Summers has been a Los Angeles Medical      Mr. Matt Longo has over 15 years operating experience
   CEO of Captor Capital Corp. and sits on the board of         Cannabis advocate since 2005, speaking and             in the cannabis industry and has extensive agricultural
   Mainstem Goods & Services.                                   promoting cannabis numerous times on the behalf of     and supply chain knowledge. Additionally he has years
                                                                patients. He has owned and operated three              of experience in general agriculture, and held various
   I-5 Holdings Ltd. is a Canadian cannabis company             dispensaries in LA since 2006 and is an experienced    operational roles at Anheuser-Busch Distribution.
   focused on the USA sector. The company owns two              grower of boutique cannabis strains.
   dispensaries in California, partnered with two cultivators                                                          Mr. Longo has guided the set-up of Prop 215 compliant
   in Washington state, created growth in a goods and           Mr. Summers is an original member and moderator of     businesses in California and navigated the complex and
   services procurement company, and assisted in the            the Greater Los Angeles Collective Alliance (GLACA),   multi-layered regulatory environments. Mr. Longo has
   opening of a laboratory in California. Mr. MacPhail was      a member of Americans For Safe Access (ASA),           owned and operated two cultivation facilities with a total
   one of the first individuals to recognize the tighter        Marijuana Policy Project (MPP), Patients Advocacy      of 20,000 square feet and employed roughly 100
   restrictions on retail/dispensary licenses in California     Network (PAN). He is also a former member of the       employees. Prior to his role with Captor he owned and
   and created a strategy going forwards for I-5 to leverage    South Robertson Neighborhood Council, Pico             operated a dispensary and was involved in three other
   that restriction into a more profitable and defensible       Neighborhood Council, Melrose West Neighborhood        cannabis-related business ventures across the United
   position for the company.                                    Council and UFCW Local 770.                            States, including a 70-acre hemp production farm in
                                                                                                                       Franklin, TN and a 22,000 acre licensed hemp farm in
   Prior to his involvement in the US cannabis space he                                                                Madisonville, Kentucky. Both farms are licensed by the
   was Investment Banker he has assisted companies to                                                                  Department of Agriculture and subject to stringent
   raise funds and advised management on corporate                                                                     protocols as a hemp producer.
   strategy.

Unless otherwise stated all amounts are in USD                                                                                                                                      27
Non- Executive Board Members

   Henry Kloepper                                            Kyle Appleby                                         Alexander Dementev
   Director                                                  Director                                             Director

   Mr. Kloepper is a former Chief Executive Officer of       Mr. Appleby is a member of the Chartered Public      Mr. Dementev is an independent geophysics researcher.
   Frontier Lithium Inc. and has worked in investment        Accountants of Canada and Ontario, and President     He provides technological solutions and services to
   banking and structured finance throughout a 30 year       and Chief Executive of CFO Advantage Inc., a         companies in various industries including manufacturing,
   career. He has a rounded knowledge of the capital         company that provides CFO, and other financial       distribution and mining. Mr. Dementev holds equivalent
   markets, strategic growth and investments. In the past,   accounting and compliance services to companies in   of Master Degree in Applied Physics from Rostov State
   Mr. Kloepper has worked in executive positions with JP    various industries including junior mining,          University and Post Graduated Degree in Analytical
   Morgan, Citibank, Bank of America, and North American     manufacturing and distribution. Mr. Appleby is       Chemistry from the Institute of Analytical Chemistry and
   Trust in Canada, the US and Europe. Currently, Mr.        currently CFO of a number of reporting issuers in    Geo-Chemistry (both in Russian Federation). Mr.
   Kloepper is a director of a number of public companies    Canada. Mr. Appleby lives in Toronto, Canada.        Dementev is currently the Chief Technology Officer for
   listed in Canada and the U.S., which are involved in                                                           Klimov Design Bureau, leading several international
   consumer finance, merchant banking, manufacturing                                                              hydrocarbons conversion projects. Mr. Dementev lives in
   and distribution. His responsibilities range from lead                                                         Toronto, Canada.
   independent director to chairing audit/compensation
   committees. Notable directorships include: Award
   Capital (Spot Coffee - food and beverage), National
   Construction, Mogul Energy (Oil and Gas), DealNet
   Capital (Consumer finance/merchant banking), Gilla Inc.
   (E cigarette manufacturer/distribution), Sofit Mobile
   (App. and technology incubator), and Pacific Software
   Inc. (Metal Fabrication).

Unless otherwise stated all amounts are in USD                                                                                                                               28
Captor Capital Corporation

THANK YOU
                                                 4 King Street West, Suite 401,
                                                 Toronto, ON M5H 1B6, Canada

                                                 John Zorbas
                                                 johnz@captorcapital.com

Unless otherwise stated all amounts are in USD                                    30
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