medical cannabis bp

BUSINESS PLAN

ADVISORY &CONFIDENTIALITY REQUIREMENT

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This Strategic Business Plan (hereinafter referred to as the Plan) contains proprietary information and is not to be copied, reproduced, used or divulged to any person in whole or in part without proper authorization, either verbal or in writing, from an Ocer or Director of CannabisRx. (CannabisRx or the Company). This information is the property of the Company. The information contained in this Plan is considered accurate as of its date. Such information is, however, subject to change at any time. Any party reviewing this Plan should not construe its content as legal, tax or investment advice. This Plan and any documents that may be delivered herewith should be reviewed by each prospective investor and with such investors financial, legal and tax advisors. The statements, estimates and projections as to the future revenues and results of operations of the Company are based upon estimates of management.

This Business Plan contains forward-looking statements reflecting Company managements present expectations. Investors are cautioned that all forward-looking statements involve risk and uncertainties, including, without limitation, the Companys ability to develop commercially viable products. Development delays, changing regulations, the Companys ability to attract and retain business partners, future levels of funding, competition from other firms, competitive, evolving markets for pharmaceuticals, the Companys ability to protect its intellectual property, the Companys ability to successfully market its products and the Companys ability to secure the capital required for product development, operations and marketing remains uncertain. The projections of future financial and operating performance have been provided to assist in an evaluation of the projected business outlined in this Plan, but are not to be relied upon as accurate representations of future results. Furthermore, because the projected financial information is based upon estimates and hypothetical assumptions about circumstances and events that have not yet taken place and are subject to variation, there are no representations or warranties associated therewith, and there can be no assurance that the projected results will be attained. In fact, the results will vary and may vary materially. The projections contained herein should be read in conjunction with the hypothetical assumptions and qualifications set forth herein.

This Plan is based upon information developed by Company management solely for use by accredited prospective investors in examining the factors and details regarding the Company. This document does not purport to be all-inclusive or to contain all of the information that a prospective investor may desire. No representation or warranty is made as to the accuracy or completeness of any of the information contained herein. Each recipient of this document agrees that all of the information contained herein is of a confidential nature, that he will treat it in a confidential manner, and that he will not directly or indirectly, disclose, or permit his agents or aliates to disclose, any of such information without the prior written consent of the Company.

Neither this Plan nor any accompanying memorandum(s), nor its delivery to any prospective investor, shall constitute an oer to sell or solicit an oer to buy any securities of the Company and/or its subsidiaries, nor shall this memorandum be construed to indicate that there has been no change in the aairs of the Company and/or its subsidiaries at or near or since the date hereof.

CannabisRx CannabisRx Laboratories Inc. (the Company or CannabisRx Lab[s]) is a development stage company that specializes in the expansion of specialty medical cannabis clinics, laboratory and Cannabis Wellness Managed Services in Canada.

The Company strategy is a comprehensive synergistic model for the burgeoning medicinal cannabis industry. The clinics focus primarily on providing medical guidance from qualified doctors to help patients meet Health Canadas requirements for an Authorization to Possess Marijuana for medical purposes (ATP). CannabisRx Labs which has quickly become an innovative medicinal cannabis company dedicated in providing medical cannabis patients with the best service and cannabis products available.

The Companys first priority of this model is building a network of clinics and health practitioners to create access to a large database of patients while creating a demand for product. CRX has been successfully building this network of doctors and patients for more than two years.

CannabisRx Labs will research and develop medicinal cannabis products through its laboratory facility. The formulas and recipes developed by the Company will be marketed by its wholly owned subsidiary CannabisRx Distributing Inc. (CannabisRx Distributing). CannabisRx Distributing will be responsible to manage and market the CannabisRx brand throughout Canada and worldwide. The CannabisRx Lab model includes the medically and socially acceptable delivery methods of standardized medical cannabis infused products. The proprietary formulated products would include medicated beverages and tonics, cannabis capsules, medicated lozenges and edibles as well as a selection of topicals and salves as part of the CannabisRx Distributing line of products.

CannabisRx Labs will develop new products and joint venture with licensed producers to supply patients their medicine in various forms. CannabisRx Distributing will also expand its portfolio of medical cannabis products through acquisition and sublicense these products to specialty sub-distributors around the world.

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CORPO

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INTRODUCTION

CannabisRx Labs believes that the real advancements in medicine are not going to be made in farms but created in laboratories. Isolating the compounds, or cannabinoids, in their rare forms is where the true medicinal benefits will be found. The Company is dedicated in providing the most potent medicinal cannabis available - cannabis that contains high levels of cannabidiol, or CBD.

In raw form, marijuana leaves and buds are non-psychoactive. They contain the antioxidants, anti-inflammatories, and cannabidiol, an anti-cancer nutrient. This is proving to be a miracle superfood capable of preventing and reversing a host of chronic illnesses.

The CBD found in the cannabis plant is a highly medicinal substance with unique immune-regulating capabilities. Since the human body already contains a built-in endogenous cannabinoid system, complete with cannabinoid receptors, inputting CBD from cannabis can help normalize the bodys functional systems, including cell communication and proper immune function.

Individuals whose systems are compromised by autoimmune disorders, cellular dysfunction, chronic inflammation, cancer cells, and various other illnesses can derive a wide range of health-promoting benefits simply by consuming CBDs.

CannabisRx Labs will establish a production team, research lab, and extraction team to produce High Value Cannabidiol Oil. CannabisRx Labs and CannabisRx Distributing are jointly focused on the research and development of innovative delivery mechanisms for non-THC, which is the psychoactive ingredient in cannabis that delivers the healing properties of Cannabinoids (CBDs). The company is committed to finding and producing products that contain the highest percentage of CBDs.

Critical links to the Companys plan are the pharmacies who, in conjunction with CannabisRx Distributing, will produce propriety products that will be available by a prescription from a doctor. CannabisRx Distributing will be the first company in Canada to provide educational programs relating to these standardized dosages of cannabis products created with traditional medical protocols. The Company has created an exclusive relationship with a compounding lab to produce cannabis products. These ground breaking products will be sold through pharmacies and clinics.

CannabisRx Distributing holds several exclusive licensing agreements with licensed producers, compassion clubs and mail-order for the distribution of medical cannabis to its patients. (See the CannabisRx Labs Organizational Chart on Page??)

The traditional medical protocols that CannabisRx Labs and our ability to scale all segments of our business modelgives CannabisRx Labs a unique perspective and competitive advantage. This advantage will allow us to gain market share both now and in the future. Based in Vancouver, British Columbia, the Company is home to some of the best indoor growing in the world. Vancouver provides the perfect environment for CannabisRx Labs to combine innovative and imaginative ideologies with progressive methods for creating cannabis products.

With Health Canadas new Medical Marihuana Proposed Regulations (MMPR) coming into effect this year along with the rapid expansion of medicinal cannabis in the United States continuing at its current rate, this will provide unprecedented growth for the medical cannabis industry and CannabisRx Laboratories Inc.

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INTRODUCTIO

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MARKET ANALYSIS

Cannabis Market - Global

The legal and political landscapes for medical cannabis are improving at rates more rapid than expected. A definitive shift in public perception has been gaining momentum regarding cannabis as medical solutions. The global medical cannabis market is expanding quickly as more and more countries legalize the use of cannabis for medical purposes.

Taking note of strong Canadian and U.S. support, nine (9) European territories (Israel, Austria, Germany, Netherlands, Spain, Italy, Finland, Portugal and most recently Czechoslovakia) have already have medicinal marijuana programs in place and many more are also beginning to introduce legalization processes.

The medicinal cannabis industry's estimated worth in 2011 was $1.7 billion, according to a report by independent financial analysis firm See Change Strategy. The report goes on to estimate growth will reach $8.9 billion by 2016 (500%+). Popularity of internet search terms for medical cannabis have increased 3000% since 2009, and statistics show a steady increase in interest as Health Canada and additional U.S. states enact legislation authorizing the legal use of medical cannabis.

MARKET ANALYSIS

CANNABIS MARKET - GLOBAL

Tobacco and alcohol sales generate over $17 billion in federal tax revenue. States tax tobacco and alcohol and benefit as well. Given the current economic environment and the deficits states are facing, it is understandable why legalization is a topic of discussion. Assuming comparable taxes to tobacco of 40-50% (excise and sales tax), a $40 billion marijuana market would yield $16-20 billion in taxes. 2010 CNBC.com http://www.cnbc.com/id/36179677/How_Big_Is_The_Marij

Estimated Marijuana Market - $35-45 Billion

If you believe prices are higher and/or users will partake more then assumed in the data then you will likely fall on the right side of the scale. If, however, you believe consumption will remain low and legalization will actually bring prices down, then the marijuana market will be smaller. After looking at all three approaches above, the answer likely falls somewhere in the middle, between $35 and $45 billion.

MARKET ANALYSIS

CANNABIS MARKET - GLOBAL

More than 32% of the United States have already enacted legislation in favour of medical cannabis, and a many more US states have bills slated for the ballot. According to Newsweek, the U.S. had about 369,000 registered users in 13 states in 2010. Five years earlier, in 2005, there were about 15,000 users in eight states, according to the Congressional Research Service. Sea Change estimates there are about 800,000 current and nearly 25 million potential medical marijuana patients in the U.S.

Voters in Colorado and Washington State recently approved the legalization of marijuana for recreational not medical purposes. This represents significant opportunities for growth in the coming years. Legal marijuana is already big business in Colorado. In the past two years the state approved 739 sites for growing marijuana some with 10,000 plants and the industry leases a total of about 1 million square feet (93,000 sq. m) of space in the Denver area. Pot is expected to be an even bigger business in Washington. Approximately 1,000 grow sites will be needed to meet demand, with 363,000 consumers in the state anticipated to be somehow ingesting in the neighbourhood of 187,000 lb. (85,000 kg) of dry marijuana annually.

The cannabis industry is rapidly approaching the tipping point for majority acceptance. When that point is reached, 75 years of accumulated consumer demand will be unleashed for products that are healthy and sustainable solutions to a myriad of environmental, economic, and social problems we face today.

There is a strong possibility that 64% of the United States will have legislation in place that supports medical cannabis, greatly influencing the federal positions of legalization policies in both Canada and the United States, as well as opening up new markets, and new possibilities.

MARKET ANALYSIS

CANNABIS MARKET - CANADA

The Medical Cannabis industry in Canada is on the precipice of a major change in British Columbia. Its estimated that the annual value of B.C.s cannabis industry is nearing $6 billion and its estimated there are between 500,000 and 1,000,000 medical cannabis consumers in Canada. (http://www.biv.com/article/20120703/BIV0119/307039918/-1/BIV/bc-146-s-medicinal-marijuana-business-growing)

According to a recent study released by Health Canada, as of August 13, 2012, individuals authorized to possess marihuana for medical purposes had grown to 21 986 individuals under the MMAR program. (See Marihuana for Medical Purposes Regulations December 15, 2012).

The proposed Marihuana for Medical Purposes Regulations (MMPR) would treat dried marihuana as much as possible like a medication by creating a licensing scheme for the commercial production and distribution of dried marihuana for medical purposes. The proposed MMPR would authorize three key activities: the possession of dried marihuana for medical purposes by individuals who have the support of an authorized health care practitioner; the production of dried marihuana by licensed producers; and the sale and distribution of dried marihuana by specific regulated parties to individuals who can possess it. Licensed producers would be subject to regulatory requirements related to security; good production practices; packaging, labelling and shipping; record keeping and reporting; and distribution.

If the Program continues to grow at the current pace, it is estimated that by 2014, over 50,000 individuals will be authorized to possess marihuana for medical purposes.

Under both the status quo scenario and the proposed MMAR, the analysis assumed the historical growth rate in authorized users of approximately 40% per annum from 20142024. Under the status quo scenario, the number of potential users of marihuana for medical purposes was projected to increase from a base number of 57,799 in 2014 to about 433,688 in 2024, slightly below the upper limit of 450,000. While the absolute number of legal users is still expected to increase over time, this increase was projected to be approximately 30% less over the 10-year period under the proposed MMAR compared to the status quo scenario. This would mean an increase from a low projected estimate of 41 384 in 2014 to approximately 308 755 users by the end of the 10th year of implementation. Their analysis also assumes a price change from about $7.60 per gram to about $8.80 per gram over the 10-year period. Therefore, an ounce of marijuana can cost each patient $150 to $250 in Canada. In addition, the average daily amount has continually increased since 2002 to almost 10 g per day.

Health Canada also stated in its report that business, especially medium-sized business, is a beneficiary in terms of producer surplus benefits and the expansion of the legal marihuana supply industry that could grow to more than $1.3 billion per year in annual sales by the end of the forecast period.

Significant growth opportunities exist for cannabis business development including, but not limited to, production, product safety controls, product tracking, ERP, commerce software, digital marketing, social media, data mining, and patient education. Rapid industry growth has compressed business cycles, fostering the necessity for technological advancements.

Significant investment opportunities will be created as these industries establish themselves as critical components of Canada, the U.S. and World gross domestic product. There is ample room for growth and expansion in all sectors of the medical cannabis industry, which translate to returns on investments far greater than in most segments of the domestic and world markets.

A HEALTHY CHOICE FOR

MEDICINAL CANNABIS

BOARD OF DIRECTORS

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The Companys Board of Directors is comprised of individuals with indoor growing and greenhouse industry expertise. CannabisRx intends to augment its Board of Directors, choosing individuals who will assist in developing and implementing the strategic plan of the Company. The Board of Directors will be comprised of senior individuals with experience in public companies, indoor growing and greenhouse development, international marketing, finance, law and accounting.

To ensure best practices in corporate governance, the Company intends to put in place an annual review process for the Board of Directors, which will be regulated through Board terms of one year and an annual shareholders vote to determine CannabisRxs Board members. This will also ensure that the decision process within the Company is based entirely on shareholder interest that is conducive to developing the Company, and that the right people and experts are in place to assist the Company in developing and implementing its business plans. The current members of the Companys Board of Directors are highlighted below.

Our mission is to provide safe, compassionate and reliable access to services t h a t s u p p o r t m e d i c a l cannabis as an alternative treatment.

SHORT TERM OBJECTIVES

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During the next 12 months, the following factors have been identified as significant keys to success:

1 Secure Financing.

The Company is now seeking financing of $1,500,000.00 through private equity to provide additional working capital for CannabisRx, particularly to expand the number of Patient Clinics to five (5); To open our own laboratory for research and product development. Expand our current distribution and licensing of products. (See the use of funds Chart page #17 )

2 Strengthen Management and Organizational Team.

The core management team is in place, but additional resources are required to fill specific roles. CannabisRx will also be adding distinguished professionals from the indoor horticulture industry field to the advisory board, to guide future technology acquisitions and development initiatives. Management will be evaluating a number of qualified individuals that will join the Company.

3 Join Industry Groups.

It will be of strategic importance for the Company to join industry associations within the indoor horticulture industry expertise. Industry associations set the standards for safety and standardization in products and technologies and can help CannabisRx educate the industry on its technologies.

4 Acquire Controlled Substance Licensing from Health Canada.

With the advent of a Controlled Substance licence, CannabisRx can export and import product globally. CannabisRx has identified 15 international locations that are requesting medical cannabis products.

5 Attend Industry Trade shows.

Trade shows in the indoor growing and greenhouse vegetables industries are critical to the Companys marketing strategy in increasing awareness of CannabisRxs products and solutions.

The Company plans to attend the following conferences or trade shows in 2013:

- 48th Annual Post Graduate Review in Family Medicine Feb 27 -29 2013

- Treating Yourself Expo May 24 - 26, 2013

- Vancouver Health Exposition June 28-30, 2013

- National Marijuana Business Conference Seattle , Nov 7 & 8, 2013

- Rural & Remote Doctors Convention Victoria April 2013

MISSION STATEMENT

1 Expand agreements to licensed producers.

The Company anticipates the deployment of 5 to 8 large-scale licensed producers in Canada.

2 Strengthen Sales and Marketing Team.

The Company intends to establish a network of representatives worldwide to market CannabisRx products to commercial/industrial clients as well as to strengthen its own internal sales and marketing team.

3 Identify and Develop Additional Strategic Business Partners.

Company management will be seeking strategic marketing and business partners in order to develop long-term partnerships providing for positive eect on revenues and net income. Partnering with greenhouse companies will be a key focus.

4 Continue Research and Development Eorts.

CannabisRx continues to research and develop new and innovative indoor growing equipment as well as enhancing the existing technologies to increase eciencies and to improve profit margins. A long-term commitment to research and development is critical to ensuring long-term sustainability and profitability of the Company.

5 Identify and Work with Third-Party Specialists in Research and Development.

CannabisRx will work closely with third party specialists engineers and designers worldwide in the development of technologies as related to the Companys indoor horticulture solutions. While the Company can leverage the knowledge and experience of third party specialists, CannabisRx can also raise credibility of its products and technologies through independent testing.

6 Contemplate Future Financings.

As the Company continues to expand and build up its operations and activities, additional financings will be contemplated to fund continued growth. Such future growth will be a combination of organic (through expansion) and technology acquisitions. CannabisRx anticipates additional financings will be secured through a second round of public financing.

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SUSE OF FUNDS

MEDICINAL M

ARIJUANA LABORATORY

CannabisRx Laboratory Our mission is to provide patients with a better basis of knowledge in order to find the best medicine for their medical ailments. Medical cannabis potency has been virtually undefined with patients having no means to regulate dosage.

CannabisRx Labs will research and develop medicinal cannabis products through its laboratory facility. The formulas and recipes developed by the Company will be marketed by its wholly owned subsidiary CannabisRx Cannabis Distributing Inc. (CannabisRx Distributing)

CannabisRx Labs will develop new products and joint venture with licensed producers to supply patients their medicine in various forms. CannabisRx Distributing will also expand its portfolio of medical cannabis products through acquisition and sublicense these products to specialty sub-distributors around the world. (See the CannabisRx Labs Organizational Chart on Page??)

The CannabisRx Lab intends to be the leader in standardizing packaging and dosages for dispensaries, licensed growers and patients. Our lab will also consult with a wide variety of clients in the cannabis industry that are looking to make their medicine high quality and safe for their customers.

CannabisRx Pharmacy

CannabisRx will build the first /lab/compounding pharmacy combination in Canada which specializes in cannabis research and development. It will have a modern look using age-old methodologies.

A compounding pharmacist is a specialist in the area of pharmaceuticals. Today, very few pharmacies provide this type of personalized service. Until the 20th century, all pharmacies were compounding pharmacies, meaning they combined one or more active ingredients into a customized treatment for an individual patients needs .A compounding pharmacist was a common fixture in a community before the mass production of medications. Qualified health practitionerswho specialize in medicinal cannabis are returning to the expertise of a compounding pharmacist.

The very basis of the pharmacy profession is the triad. This triad is the patient-physician-pharmacist relationship. The cycle of this relationship starts with the patient needs being determined by his physician. The physician then chooses a path of treatment that may include a compounded medication.

MEDICINAL M

ARIJUANA LABORATORY

CannabisRx plans to meet this increasing demand by working with all members of the triad relationship. Qualified CRX healthcare practitioners will be able to prescribe medication specific to their patients individual needs in accordance to Health Canadas guidelines.

The pharmacy rules allow pharmacists to formulate a prescription when so ordered by the licensed practitioner for a specific patient. Therefore, any medical doctor or nurse practitioner that is licensed to prescribe medications can write prescriptions for compounded or formulated products.

The CannabisRx lab/pharmacy will be dedicated in formulating high-quality pharmaceutical-grade ingredients as prescribed by a healthcare practitioner, into specific dosage forms such as capsules, creams, gels, tablets and lozenges. These forms may be taken either orally, topically, sublingually or buccally. Healthcare practitioners can therefore be more easily fine-tuned or modified to the dose or prescription as an individuals needs change, or match an individuals preferences and absorption abilities.

CannabisRx Cannabis Laboratory Services: By standardizing cannabis we are able to better determine dosage and ecacy and clients will be better equipped to develop regimens for treating pain. The standardization process involves testing by High Pressure Liquid Chromatography (HPLC) the raw material prior to heating to determine the amounts of the various components such as THC and CBD.

Potency Analysis

Being aware of the potency of medical cannabis is fundamental in allowing the patient to choose the correct medicine for their needs, as well as determining how much to take.

In commercial medicine, the potency of a drug is clearly stated on the label so one knows the correct dose. Unfortunately, this is not the case in medical cannabis. Cannabis Potency Testing enables patients to know the amount of active ingredients so they can be confident they are administering an appropriate dose. Taking the correct amount of medical cannabis can bring welcome relief however taking too much can have very negative side eects such as feelings of anxiety and paranoia.

CannabisRx Labs Cannabis Potency Analysis will measure the major active compounds present in medical cannabis:

Tetrahydrocannabinol (THC) The main psychoactive component

Cannabidiol (CBD) A non-psychoactive important for pain relief and other health related eects

Cannabinol (CBN) A degradation product of THC

Microbiological Screen

Exposure to high levels of microorganisms such as molds and bacteria are known to cause health problems and can be particularly dangerous to patients that have existing medical problems.

The CannabisRx Labs microbiological screening program will ensure the safety of medical cannabis by identifying the type and level of microorganisms present in the medicine. Molds are ubiquitous and small amounts are found in almost every sample. However, patients with existing health problems should not be exposed to medicines that contain large amounts. Medicines that contain bacteria should be destroyed.

Pesticide Screen

Pesticides used in growing operations can be present in the final form of the medicine. They are toxic at high levels and can be harmful at lower doses, especially to those with serious medical conditions.

It has been found that pesticides used in growing operations can be present in the final form of the medicine. Exposure to these chemicals can be harmful to patients; they are toxic at high levels and can be harmful at lower doses, especially to those with other serious medical conditions.

The CannabisRx Lab will oers residual pesticide testing so that medical cannabis patients can avoid harmful pesticide contaminates via their medicines.

CannabisRx is in the process of acquiring a research and development license for controlled substances through Health Canada. This will allow CannabisRx to import and export various products and strains worldwide.

Compounding Services The CannabisRx lab will contain a compounding pharmacy where our pharmacist will combine one or more active ingredients into a customized treatment for an individual patients needs. Our lab/pharmacy will be dedicated in formulating high-quality pharmaceutical-grade ingredients as prescribed by a healthcare practitioner, into specific dosage forms such as capsules, creams, gels, tablets, lozenges, and other forms.

Healthcare practitioners can more easily fine-tune or modify the dose or prescription as an individuals needs change, or match an individuals preferences and absorption abilities.

MEDICINAL M

ARIJUANA LABORATORY

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Currently, Health Canada grants access to cannabis for medical use to those Canadians who are suering from severe and agonizing illnesses. It is not legal to grow or possess cannabis except with legal permission by Health Canada under the current MMAR (Medical Marihuana Access Regulations). Prairie Plant Systems is the only organization that can legally supply cannabis seeds and dried cannabis to persons authorized to possess and/or licensed to produce cannabis. The Prairie Plant Systems contract ends March 31,2014. This presents an opportunity for commercial licensees who quality under the new Health Canada Regulations, eective April 1, 2013 to compete in the market place which is estimated to be over 300,000 patients over the next 10 years. The market in Canada is estimated by Health Canada to be over $1.5 billion. Our current patient flow gives CannabisRx Labs a ground floor advantage with the upcoming proposed changes to the MMAR.

The proposed changes brought by Health Canada are looking to eliminate personal and designated production sites. Patients will then only be able to purchase cannabis that has been produced by commercial grow operations.

With proposed changes to Health Canadas medical marijuana program, our facility will fit well with the governments mandate to provide medical cannabis, through physicians and other Health Canadas approved practitioners, thereby increasing numbers of approved patients in the country.

Licensed Producer Brain Trust Joint Venture

This business opportunity will be offered to pre-screened experienced growers of cannabis who have a physical location and wish to qualify as licensed producers with Health Canada. They may have difficulty qualifying under their current situation but could otherwise qualify using the CannabisRx brain trust or key personnel as defined by Health Canadas MMPR document.This will provide the licensed producer with CannabisRx distribution and compliance with Health Canada. CannabisRx distribution can provide cash flow, because of its access to patient flow via the clinical network. This is a key component that separates us from any other company in the Canada. CannabisRx will participate in an equity position of licensed producers depending on their level of qualification.

The photo and revenue projections chart are representative of an example of our agreements with licensed producers.

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MEDICINAL M

ARIJUANA LICENSED PRODUCER

MEDICINAL MARIJUANA LICENSED PRODUCER

REVENUE&PROJECTIONS&PRODUCTION&FACILITY&3&LARGE&BUILD&3&360&LIGHTS

Price&Per&Gram: 4.00$&&&&&&&&&&&&No.&of&Lights 36No.&of&rooms 10Sq.&Footage 15,000

1 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 235 2,288,160$&& 2,516,976$&& 2,745,792$&& 2,974,608$&& 3,203,424$&& 3,432,240$&& 3,661,056$&&&& 3,889,872$&&&& 4,118,688$&&&& 4,347,504$&&&& 4,576,320$&&&&36 2,353,536$&& 2,588,890$&& 2,824,243$&& 3,059,597$&& 3,294,950$&& 3,530,304$&& 3,765,658$&&&& 4,001,011$&&&& 4,236,365$&&&& 4,471,718$&&&& 4,707,072$&&&&37 2,418,912$&& 2,660,803$&& 2,902,694$&& 3,144,586$&& 3,386,477$&& 3,628,368$&& 3,870,259$&&&& 4,112,150$&&&& 4,354,042$&&&& 4,595,933$&&&& 4,837,824$&&&&38 2,484,288$&& 2,732,717$&& 2,981,146$&& 3,229,574$&& 3,478,003$&& 3,726,432$&& 3,974,861$&&&& 4,223,290$&&&& 4,471,718$&&&& 4,720,147$&&&& 4,968,576$&&&&39 2,549,664$&& 2,804,630$&& 3,059,597$&& 3,314,563$&& 3,569,530$&& 3,824,496$&& 4,079,462$&&&& 4,334,429$&&&& 4,589,395$&&&& 4,844,362$&&&& 5,099,328$&&&&40 2,615,040$&& 2,876,544$&& 3,138,048$&& 3,399,552$&& 3,661,056$&& 3,922,560$&& 4,184,064$&&&& 4,445,568$&&&& 4,707,072$&&&& 4,968,576$&&&& 5,230,080$&&&&41 2,680,416$&& 2,948,458$&& 3,216,499$&& 3,484,541$&& 3,752,582$&& 4,020,624$&& 4,288,666$&&&& 4,556,707$&&&& 4,824,749$&&&& 5,092,790$&&&& 5,360,832$&&&&42 2,745,792$&& 3,020,371$&& 3,294,950$&& 3,569,530$&& 3,844,109$&& 4,118,688$&& 4,393,267$&&&& 4,667,846$&&&& 4,942,426$&&&& 5,217,005$&&&& 5,491,584$&&&&43 2,811,168$&& 3,092,285$&& 3,373,402$&& 3,654,518$&& 3,935,635$&& 4,216,752$&& 4,497,869$&&&& 4,778,986$&&&& 5,060,102$&&&& 5,341,219$&&&& 5,622,336$&&&&44 2,876,544$&& 3,164,198$&& 3,451,853$&& 3,739,507$&& 4,027,162$&& 4,314,816$&& 4,602,470$&&&& 4,890,125$&&&& 5,177,779$&&&& 5,465,434$&&&& 5,753,088$&&&&45 2,941,920$&& 3,236,112$&& 3,530,304$&& 3,824,496$&& 4,118,688$&& 4,412,880$&& 4,707,072$&&&& 5,001,264$&&&& 5,295,456$&&&& 5,589,648$&&&& 5,883,840$&&&&46 3,007,296$&& 3,308,026$&& 3,608,755$&& 3,909,485$&& 4,210,214$&& 4,510,944$&& 4,811,674$&&&& 5,112,403$&&&& 5,413,133$&&&& 5,713,862$&&&& 6,014,592$&&&&

Notes:Total&Annual&OperaJng&Cost&=&$3,000,000&(Health&Canada&=&+10%&Admin&cost&included)"Sea&of&Green"&can&add&about&25&U&40%&increase&in&revenue&(Upgrade&cost&about&$250,000)Cost&of&Land:&$1,250,000Cost&of&Building:&$1,500,000Cost&of&Equipment:&$800,000Total:&$3.55M

ProducKon&(lbs&per&light)

Num

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REVENUE&PROJECTIONS&PRODUCTION&FACILITY&3&LARGE&BUILD&3&360&LIGHTS

Price&Per&Gram: 4.00$&&&&&&&&&&&&No.&of&Lights 36No.&of&rooms 10Sq.&Footage 15,000

1 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 235 2,288,160$&& 2,516,976$&& 2,745,792$&& 2,974,608$&& 3,203,424$&& 3,432,240$&& 3,661,056$&&&& 3,889,872$&&&& 4,118,688$&&&& 4,347,504$&&&& 4,576,320$&&&&36 2,353,536$&& 2,588,890$&& 2,824,243$&& 3,059,597$&& 3,294,950$&& 3,530,304$&& 3,765,658$&&&& 4,001,011$&&&& 4,236,365$&&&& 4,471,718$&&&& 4,707,072$&&&&37 2,418,912$&& 2,660,803$&& 2,902,694$&& 3,144,586$&& 3,386,477$&& 3,628,368$&& 3,870,259$&&&& 4,112,150$&&&& 4,354,042$&&&& 4,595,933$&&&& 4,837,824$&&&&38 2,484,288$&& 2,732,717$&& 2,981,146$&& 3,229,574$&& 3,478,003$&& 3,726,432$&& 3,974,861$&&&& 4,223,290$&&&& 4,471,718$&&&& 4,720,147$&&&& 4,968,576$&&&&39 2,549,664$&& 2,804,630$&& 3,059,597$&& 3,314,563$&& 3,569,530$&& 3,824,496$&& 4,079,462$&&&& 4,334,429$&&&& 4,589,395$&&&& 4,844,362$&&&& 5,099,328$&&&&40 2,615,040$&& 2,876,544$&& 3,138,048$&& 3,399,552$&& 3,661,056$&& 3,922,560$&& 4,184,064$&&&& 4,445,568$&&&& 4,707,072$&&&& 4,968,576$&&&& 5,230,080$&&&&41 2,680,416$&& 2,948,458$&& 3,216,499$&& 3,484,541$&& 3,752,582$&& 4,020,624$&& 4,288,666$&&&& 4,556,707$&&&& 4,824,749$&&&& 5,092,790$&&&& 5,360,832$&&&&42 2,745,792$&& 3,020,371$&& 3,294,950$&& 3,569,530$&& 3,844,109$&& 4,118,688$&& 4,393,267$&&&& 4,667,846$&&&& 4,942,426$&&&& 5,217,005$&&&& 5,491,584$&&&&43 2,811,168$&& 3,092,285$&& 3,373,402$&& 3,654,518$&& 3,935,635$&& 4,216,752$&& 4,497,869$&&&& 4,778,986$&&&& 5,060,102$&&&& 5,341,219$&&&& 5,622,336$&&&&44 2,876,544$&& 3,164,198$&& 3,451,853$&& 3,739,507$&& 4,027,162$&& 4,314,816$&& 4,602,470$&&&& 4,890,125$&&&& 5,177,779$&&&& 5,465,434$&&&& 5,753,088$&&&&45 2,941,920$&& 3,236,112$&& 3,530,304$&& 3,824,496$&& 4,118,688$&& 4,412,880$&& 4,707,072$&&&& 5,001,264$&&&& 5,295,456$&&&& 5,589,648$&&&& 5,883,840$&&&&46 3,007,296$&& 3,308,026$&& 3,608,755$&& 3,909,485$&& 4,210,214$&& 4,510,944$&& 4,811,674$&&&& 5,112,403$&&&& 5,413,133$&&&& 5,713,862$&&&& 6,014,592$&&&&

Notes:Total&Annual&OperaJng&Cost&=&$3,000,000&(Health&Canada&=&+10%&Admin&cost&included)"Sea&of&Green"&can&add&about&25&U&40%&increase&in&revenue&(Upgrade&cost&about&$250,000)Cost&of&Land:&$1,250,000Cost&of&Building:&$1,500,000Cost&of&Equipment:&$800,000Total:&$3.55M

ProducKon&(lbs&per&light)

Num

ber&of&Crops&Per&Yea

r

REVENUE PROJECTIONS - LICENSED PRODUCER 360 LIGHTS

RESOURCE CENTRE

Business opportunity The lack of education about medicinal marijuana and combined with the slow and challenging application process for Health Canada certification provides a ground floor opportunity for expansion of the current model CRX clinics Canada wide.

CRX has created a procedures and operations manual for medical marijuana specialty clinics and a reference manual on dosages and strains for our aliated doctors. These manuals will be invaluable to parties looking for a competitive advantage. The company is currently in the process of applying for a section 56 Controlled Substance exemption. This licence will allow CRX to do clinical research using cannabis and allow reciprocal trade and sale internationally to qualified countries.

CRX Services

CRX charges for its services to assist patients who qualify for an Authorisation to Possess (ATP) under Health Canadas MMAR; and helps patients who might benefit from the use of medicinal cannabis by providing the following services:

helping them gather their necessary medical files

assisting them in completing their MMAR applications

arranging for them to see a physician aliated with the Centre

providing consultation and instruction on all aspects of medicinal cannabis

CRX has taken the lengthy and somewhat bureaucratic application process of obtaining an MMAP and streamlined it to a simple and pain free process.. CRX also assists patients who do not qualify for an ATP but do not qualify for membership at cannabis dispensaries and compassion clubs by providing access to an aliatedDoctor.

Recent Google Analytics to the CRX website indicates a high percentage of unique visitors (about 70%) and they are spending, on average 10 minutes and more on the website which may indicate the importance of critical information provided by CRX (the web average for all visitors is between 3.2 minutes to 5.14 minutes). 60% are new visitors, 40% return and 87% of the visitors are from Canada with the other from the US, and abroad. (See Google Analytics Graph - APPENDIX - C: Website snapshot: Jan 15 Feb 5, 2013)

CRX Google Analytics (Jan 15 to Feb 10, 2013)

CannabisRx- Vision for expansion CannabisRx will expand the CRX model into Alberta, Manitoba, Ontario and Nova Scotia and, potentially, additional locations in BC. These clinics will be a combination of corporately owned and Co-operative partnerships.

CannabisRx will oer two types of clinics: (1) a Clinic based operation, similar to what CRX is currently providing in its Vancouver Flag ship location (2) a combination of clinic / pharmacy where patients can enter the clinic and receive their licence and then proceed to the neighbouring CannabisRx pharmacy to pick up their prescription.

These structures will benefit from volume purchasing, ecient high tech delivery of pharmacy products, custom designed retail and professional strategies, and a supportive peer network that shares experiences, knowledge and philosophy. This collaborative infrastructure and vision will assist each clinic to promote and support look the health of each patient.

CannabisRx will have a central admin operation for all expansion clinics. All support including patient services (Patient intake, initial enrolment), marketing and branding will be handled out of head oce, reducing cost and increase profits. This collaborative infrastructure and vision allows for our expansion clinics and community pharmacist, to do what they do best look after the health of their patients.

The new laws and regulations from Health Canada will aect compassion clubs licensing their members. CannabisRx and CRX are well positioned with agreements to provide licensing and renewal licensing services to all their patients.

VISION FOR THE FUTURE

CannabisRx Distributing holds an exclusive licensing agreements CannbisMD for online mail-order for the distribution of medical cannabis to its patients. CannabisMD.ca is a Vancouver BC based company that provides Canadians who are legally authorized to possess medical cannabis / marihuana with discreet, reliable, and confidential delivery service via Canada Post, all ordered online through our website.

CannabisMDs mission is to strive to meet the needs of Canadians who require safe, aordable, and legal access to high quality medical marihuana. We are committed to improving our clients' well-being and standard of living by providing access to eective pain management. Our online store provides information to allow clients to make a more informed choice.

Many Law enforcement agencies, town and city councils have expressed concerns with retail storefront dispensaries. They site crime as being the biggest threat these operations. Many of the new rules and regulations stipulate that storefronts must be a quantified distance from schools. With online dispensaries we are able to limit the risk of crime and the fact we do not need a storefront the location of our warehouse is located in a safe zone.

Our Vision is to foster innovation and integrity through collaboration with doctors, researchers, government, clients and their communities. In doing so, our goal is to provide Canadians aicted with debilitating illnesses essential alternatives that respect the patients' choice.

Currently all of our customers must meet Health Canadas licensing requirements to obtain an MMAR card in order to purchase medical Cannabis for his or her medical condition. Once a customer has an MMAR card they can join our online collective and start ordering high quality cannabis reliable medical cannabis.

As a client of CannabisMD, we can provide our qualified clients with a supply of product based on their MMAR approved maximum dosage. We sell in minimum single gram units that range from $2.50 to $10.00 per gram depending on the strain. All clients are responsible to pay for their own shipping fees that we will add to the total bill. We provide several dierent courier options, which vary depending on where you are located.

Page 26

DISTRIBUTION

DISTRIBUTIONCOMPETITION CannabisMD is in the medical cannabis distribution business and is focused on bringing qualified Canadian patients the highest quality medicinal cannabis to treat their aliment. CannabisMDs direct competitors are other online distributers of medicinal cannabis products. Some of the competitors are online distributers and some are brick and mortar outlets (dispensaries) that sell online as well. Consumers will continue to do more research on companies, products and pricing, as more information becomes available online.

Currently, most online distribution companies oer a limited amount of strains in some cases only one strain. Most of the brick and mortar companies oer a variety of strains at a high cost. (Averaging $8.50-$15.50 a gram). CannabisMD will oer a high quality superior product at $12.50 and a variety of lower end product at $2.50. CMD is able to market its product at a rate better suited for our consumers because of its in house production facility and its commitment to oering high quality strains at a lower cost for the patient.

There are a number of small competitors in this market. However, online in Canada only three standout. (Natural Order Health Services http://www.naturalorder.me; Bud Buddy http://www.budbuddy.biz; and Prairie Farms http://www.prairieplant.com)

Natural Order Health Services is located in Victoria, BC and oers one strain of medical cannabis to its customers at medium $5.50 per gram. They sell to patients through out Canada. Bud Buddy is located in Vancouver, BC, caters to recreational users and pushes the limits of being legal. They service all of Canada and sell three types of strains a low quality, medium quality and a high quality, ranging in price form $11.50 to $15.00. Prairie Plant is currently the government sanctified online distributer for medical cannabis. Prairie oers only one low quality strain at $5.50 per gram.

Indirect competition comes in many forms including oine retailers or dispensaries. However many government, police ocials and local communities have stated they wish to move away from the retail brick and mortar type of operations.

CannabisMD will oer ten strains from medium to high quality only, including some exclusively licensed strains and strains that are completely organic. One of CannabisMDs mandate is to research and identify strains that work best for a specific ailments.

Page 27

PROFORMA

CannabisMD)*)Year)1Month)1 Month)2 Month)3 Month)4 Month)5 Month)6 Month)7 Month)8 Month)9 Month)10 Month)11 Month)12 Total

RevenuePa#ent'sales'per'month 30 50 100 250 500 650 800 1000 1250 1500 1750 2000Average'28'grams'per'month 196 196 196 196 196 196 196 196 196 196 196 196$7.00'per'gram 5,880$'''''''' 9,800$'''''' 19,600$''''' 49,000$''' 98,000$''' 127,400$'' 156,800$' 196,000$''' 245,000$'''''' 294,000$''' 343,000$''' 392,000$'' 1,936,480$''Cost'per'28'grams' 105 105 105 105 105 105 105 105 105 105 105 105Product'cost 3,150$'''''''' 5,250$'''''' 10,500$''''' 26,250$''' 52,500$''' 68,250$'''' 84,000$'''' 105,000$''' 131,250$'''''' 157,500$''' 183,750$''' 210,000$'' 1,037,400$''addi#on'rev'streams 500$'''''''' 500$'''''''' 1,000$'''''' 1,000$'''''' 1,000$''''''' 1,500$''''''''''' 1,500$''''''' 1,500$''''''' 2,000$''''''' 10,500$''''''''Total)Revenue)Less)Cost)of)Goods 2,730$'''''''' 4,550$'''''' 9,100$''''''' 23,250$''' 46,000$''' 60,150$'''' 73,800$'''' 92,000$''''' 115,250$'''''' 138,000$''' 160,750$''' 184,000$'' 909,580$'''''

ExpensesLegal'Exp 5,000$'''''''' 98$''''''''''' 196$'''''''''' 490$'''''''' 980$'''''''' 1,274$'''''' 1,568$'''''' 1,960$''''''' 2,450$''''''''''' 2,940$''''''' 3,430$''''''' 3,920$''''''' 24,306$''''''''Accoun#ng 2,000$'''''''' 500$'''''''''' 500$'''''''' 500$''''''''' 500$'''''''''''''' 500$''''''''''' 1,500$''''''' 6,000$''''''''''Oce 500$''''''''''' 500$''''''''' 500$'''''''''' 500$'''''''' 500$'''''''' 500$''''''''' 500$''''''''' 500$''''''''''' 500$'''''''''''''' 500$''''''''''' 500$''''''''''' 500$'''''''''' 6,000$''''''''''Oce'Equipment 6,000$'''''''' 1,000$'''''' 1,000$'''''' 1,000$''''''' 1,000$''''''''''' 1,000$''''''' 1,000$''''''' 1,000$''''''' 13,000$''''''''Inventory 200$'''''''' 200$'''''''' 400$''''''''' 400$''''''''' 400$''''''''''' 600$'''''''''''''' 600$''''''''''' 600$''''''''''' 800$'''''''''' 4,200$''''''''''licensing L$''''''''''''''Marke#ng' 5,000$'''''''' 1,000$'''''' 1,000$''''''' 1,000$''''' 1,000$''''' 1,000$'''''' 1,000$'''''' 1,000$''''''' 1,000$''''''''''' 1,000$''''''' 1,000$''''''' 1,000$''''''' 16,000$''''''''Selling'Expense 500$''''''''' 500$''''''''''' 500$'''''''''''''' 500$''''''''''' 500$''''''''''' 500$'''''''''' 3,000$''''''''''Website 3,000$'''''''' 1,000$'''''' 1,000$''''''' 500$'''''''' 500$''''''''' 500$''''''''''' 500$'''''''''''''' 500$''''''''''' 500$''''''''''' 1,000$''''''' 9,000$''''''''''PKG'materials 1,000$'''''''' 500$''''''''' 500$'''''''''' 500$'''''''' 500$'''''''' 500$''''''''' 500$''''''''' 500$''''''''''' 500$'''''''''''''' 500$''''''''''' 1,000$''''''' 1,000$''''''' 7,500$''''''''''Employee'1 2,000$'''''''' 2,000$'''''' 2,000$''''''' 2,000$''''' 2,000$''''' 2,000$'''''' 4,000$'''''' 4,000$''''''' 4,000$''''''''''' 4,000$''''''' 4,000$''''''' 4,000$''''''' 36,000$''''''''Employee 1,500$'''''''' 1,500$'''''' 1,500$''''''' 1,500$''''' 1,500$''''' 1,500$'''''' 3,000$'''''' 3,000$''''''' 3,000$''''''''''' 3,000$''''''' 3,000$''''''' 3,000$''''''' 27,000$''''''''Misc. 700$''''''''''' 200$''''''''' 200$'''''''''' 200$'''''''' 300$'''''''' 300$''''''''' 300$''''''''' 300$''''''''''' 500$'''''''''''''' 500$''''''''''' 500$''''''''''' 500$'''''''''' 4,500$''''''''''sales'person 4,000$'''''''' 4,000$'''''' 4,000$''''''' 4,000$''''' 4,000$''''' 4,000$'''''' 4,000$'''''' 4,000$''''''' 4,000$''''''''''' 4,000$''''''' 4,000$''''''' 2,000$''''''' 46,000$''''''''Management 32,500$''''' 32,500$''''''''2%'of'sales'Net 18,192$''''' 18,192$''''''''Total)Expenses 30,700$'''''' 10,798$''' 11,396$''''' 10,390$''' 11,980$''' 12,474$'''' 17,768$'''' 17,660$''''' 19,050$''''''''' 19,040$''''' 20,530$''''' 71,412$''''' 253,198$'''''Net)Revenue 27,970L$'''''' 6,248L$'''''' 2,296L$''''''' 12,860$''' 34,020$''' 47,676$'''' 56,032$'''' 74,340$''''' 96,200$''''''''' 118,960$''' 140,220$''' 112,588$'' 656,382$'''''

Beginning'Bank'Balance L$'''''''''''' 27,970L$''' 34,218L$''''' 36,514L$''' 23,654L$''' 10,366$'''' 58,042$'''' 114,074$''' 188,414$'''''' 284,614$''' 403,574$''' 543,794$''Closing'Bank'Balance 27,970L$'''''' 34,218L$''' 36,514L$''''' 23,654L$''' 10,366$''' 58,042$'''' 114,074$' 188,414$''' 284,614$'''''' 403,574$''' 543,794$''' 656,382$''

AssumpJons:legal'at'1%'of'revenues'beginning'in'month'2Each'client'will'purchase'an'average'of'28'grams'per'monthAverage'pa#ent'cost'per'gram'='$7.00Management'Year'End'Bonus'='5%'of'Net

CannabisMD)*)Year)2Month)13 Month)14 Month)15 Month)16 Month)17 Month)18 Month)19 Month)20 Month)21 Month)22 Month)23 Month)24 Total

RevenuePa#ent'sales'per'month 2250 2500 2750 3000 3250 3500 3750 4000 4250 4500 4750 5000Average'28'grams'per'month 196 196 196 196 196 196 196 196 196 196 196 196$7.00'per'gram 441,000$'''''' 490,000$''''' 539,000$''''' 588,000$'''''' 637,000$'''''' 686,000$''''' 735,000$''''' 784,000$''''' 833,000$'''''' 882,000$''''' 931,000$''''' 980,000$''''' 8,526,000$''Cost'per'28'grams' 105 105 105 105 105 105 105 105 105 105 105 105Product'cost 236,250$'''''' 262,500$''''' 288,750$''''' 315,000$'''''' 341,250$'''''' 367,500$''''' 393,750$''''' 420,000$''''' 446,250$'''''' 472,500$''''' 498,750$''''' 525,000$''''' 4,567,500$''addi#on'rev'streams 3,000$'''''''''' 3,000$'''''''''' 3,500$''''''''' 4,000$''''''''''' 4,000$''''''''''' 5,000$''''''''' 6,000$'''''''''' 6,000$''''''''' 8,000$'''''''''' 8,000$'''''''''' 8,000$'''''''''' 10,000$'''''''' 68,500$''''''''Total)Revenue)Less)Cost)of)Goods 207,750$'''''' 230,500$''''' 253,750$''''' 277,000$'''''' 299,750$'''''' 323,500$''''' 347,250$''''' 370,000$''''' 394,750$'''''' 417,500$''''' 440,250$''''' 465,000$''''' 4,027,000$''

ExpensesLegal'Exp 4,410$'''''''''' 4,900$'''''''''' 5,390$''''''''' 5,880$''''''''''' 6,370$''''''''''' 6,860$''''''''' 7,350$'''''''''' 7,840$''''''''' 8,330$'''''''''' 8,820$'''''''''' 9,310$'''''''''' 9,800$'''''''''' 85,260$''''''''Accoun#ng 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$'''''''''''''' 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$''''''''''''' 6,000$''''''''''Oce 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$'''''''''''''' 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$''''''''''''' 6,000$''''''''''Oce'Equipment 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$'''''''''''''' 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 1,000$''''''''' 1,000$'''''''''' 1,000$'''''''''' 1,000$'''''''''' 1,000$'''''''''' 8,500$''''''''''Inventory 1,200$'''''''''' 1,200$'''''''''' 1,400$''''''''' 1,600$''''''''''' 1,600$''''''''''' 2,000$''''''''' 2,400$'''''''''' 2,400$''''''''' 3,200$'''''''''' 3,200$'''''''''' 3,200$'''''''''' 4,000$'''''''''' 27,400$''''''''licensing 2,000$'''''''''' 2,000$'''''''''' 2,000$''''''''' 2,000$''''''''''' 2,000$''''''''''' 2,000$''''''''' 2,000$'''''''''' 2,000$''''''''' 2,000$'''''''''' 2,000$'''''''''' 2,000$'''''''''' 2,000$'''''''''' 24,000$''''''''Marke#ng' 1,000$'''''''''' 1,000$'''''''''' 1,000$''''''''' 1,000$''''''''''' 2,000$''''''''''' 2,000$''''''''' 2,000$'''''''''' 3,000$''''''''' 3,000$'''''''''' 3,000$'''''''''' 3,000$'''''''''' 3,000$'''''''''' 25,000$''''''''Selling'Expense 1,000$'''''''''' 1,000$'''''''''' 1,000$''''''''' 1,000$''''''''''' 1,000$''''''''''' 1,000$''''''''' 1,000$'''''''''' 1,000$''''''''' 1,000$'''''''''' 1,000$'''''''''' 1,000$'''''''''' 1,000$'''''''''' 12,000$''''''''Website 1,000$'''''''''' 1,000$'''''''''' 1,000$''''''''' 1,000$''''''''''' 1,000$''''''''''' 1,000$''''''''' 1,000$'''''''''' 1,000$''''''''' 1,000$'''''''''' 1,000$'''''''''' 1,000$'''''''''' 1,000$'''''''''' 12,000$''''''''PKG'materials 1,000$'''''''''' 500$''''''''''''' 1,000$''''''''' 500$'''''''''''''' 1,000$''''''''''' 500$''''''''''''' 1,000$'''''''''' 500$''''''''''''' 1,000$'''''''''' 500$''''''''''''' 1,000$'''''''''' 500$''''''''''''' 9,000$''''''''''Employee'1 5,000$'''''''''' 5,000$'''''''''' 5,000$''''''''' 10,000$'''''''' 10,000$'''''''' 10,000$''''''' 10,000$'''''''' 10,000$''''''' 10,000$'''''''' 10,000$'''''''' 10,000$'''''''' 10,000$'''''''' 105,000$'''''Employees 6,000$'''''''''' 6,000$'''''''''' 6,000$''''''''' 8,000$''''''''''' 8,000$''''''''''' 8,000$''''''''' 10,000$'''''''' 10,000$''''''' 10,000$'''''''' 10,000$'''''''' 10,000$'''''''' 10,000$'''''''' 102,000$'''''Misc. 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$'''''''''''''' 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$'''''''''''''' 500$''''''''''''' 500$''''''''''''' 500$''''''''''''' 6,000$''''''''''sales'person 4,000$'''''''''' 4,000$'''''''''' 4,000$''''''''' 4,000$''''''''''' 4,000$''''''''''' 4,000$''''''''' 4,000$'''''''''' 4,000$''''''''' 4,000$'''''''''' 4,000$'''''''''' 4,000$'''''''''' 4,000$'''''''''' 48,000$''''''''Management 165,000$''''' 165,000$'''''2%'of'sales'Net 80,540$'''''''' 80,540$''''''''Total)Expenses 28,610$'''''''' 28,600$'''''''' 29,790$''''''' 36,980$'''''''' 38,970$'''''''' 39,360$''''''' 42,750$'''''''' 44,240$''''''' 46,030$'''''''' 46,020$'''''''' 47,010$'''''''' 293,340$''''' 721,700$'''''Net)Revenue 179,140$'''''' 201,900$''''' 223,960$''''' 240,020$'''''' 260,780$'''''' 284,140$''''' 304,500$''''' 325,760$''''' 348,720$'''''' 371,480$''''' 393,240$''''' 171,660$''''' 3,305,300$''

Beginning'Bank'Balance 656,382$'''''' 835,522$''''' 1,037,422$'' 1,261,382$''' 1,501,402$''' 1,762,182$'' 2,046,322$'' 2,350,822$'' 2,676,582$'' 3,025,302$'' 3,396,782$'' 3,790,022$''Closing'Bank'Balance 835,522$'''''' 1,037,422$'' 1,261,382$'' 1,501,402$''' 1,762,182$''' 2,046,322$'' 2,350,822$'' 2,676,582$'' 3,025,302$'' 3,396,782$'' 3,790,022$'' 3,961,682$''

YEAR ONE YEAR TWO

CANNABIS WELLNESS M

ANAGED SERVICES

Page 29

CANNABIS Wellness Managed Services (CWMS)CannabisRx is expected to have substantial growth through the clinics and Wellness Managed Services to licensed producers. These services include: CannabisRx Products; Brain Trust Business Compliance; Record Keeping; Accounting; Licensing Approvals; Computer Management system; Sales and Marketing; Secure Delivery services; and, Testing and Standardizations.

Licensed Producer Brain Trust Joint Venture(See section on Licensed Producers page #20)Business Compliance

Health Canada estimates that business compliance costs to be 20% of overall supply cost and could be higher based on recent experiences by cannabis producers and dispensaries in Colorado, USA. CannabisRx estimates that business compliance costs could be double these estimates under the proposed Health Canadas medical marihuana program.

Being meticulous in everyday procedures is a prerequisite for being involved in the medical cannabis industry. Knowing every detail of the law can mean the difference between success or a jail cell. Our team specializes in helping you getting and staying in compliance with Health Canada Regulations.

Record KeepingLicensed producers will have to keep records of their activities with cannabis, including all transactions (sale, exportation, importation), all dried marihuana returned from clients, and an inventory of cannabis (e.g. seeds, fresh harvested marihuana, dried marihuana and packaged marihuana). All records will have to be kept for a period of at least two years, in a format that would be easily auditable, and would have to be made available to Health Canada upon request.

Health Canadas regulations also include very specific processes for registering and verifying each individual as a client. This includes verifying that the supporting authorized health care practitioner is entitled to practice their profession in the province in which the prospective client consulted them and that they have not been prohibited from prescribing narcotics. These tasks are similar to those conducted by a pharmacist when filling out a prescription. The licensed producer would also have to confirm with the office of the authorized health care practitioner that the information in the medical document, including the daily quantity, is correct and complete. Law enforcement needs a way to verify whether a named individual is a registered client of the producer confirm as soon as practicable whether the individual is a registered client or an individual who is responsible for a registered client and the daily quantity of dried marihuana specified in the medical document.

We provide a secure log-in website that provides immediate access by an authorized user and any smart mobile device.

Maintaining the confidentiality of patient records is paramount and our security procedures are industry leading and protect the licensed producer, compassion club and the patient.

Computer Management System

Secure log-in Verification System Inventory and Tracking System - Integrated seed to sale tracking solution order reconciliation for shipment & inventories; Point of Sale, or POS Systems Billing System Software support, secure backup

Sales and MarketingFinding the right advertising venues and having a strong understanding of ROI will be invaluable. With our experience in both print and expertise online mediums. Having a strong website that is both informative and well designed is a key way to retain current patients while capturing new clientele. Content creation and search engine optimization are specialties of CannabisRx. Leveraging a patient's experiences via social media is a relatively inexpensive way to help develop your brand and voice in the community.

Strain development, branding and recognition as well as intellectual property protection services consulting, are part of our a-la-cart servicing. Brand recognition, marketing materials and brand collateral (collection of media used to support the sales of a product or service), should always be in unison, providing a united front for your business. Our best practices in these areas will help you quickly become a leader in your area.

Secure Delivery Services

CannabisRx can help further maximize a cannabis businesses profit potential by showing exactly what a safe and secure delivery organization looks like, all while providing top notch service for your patients. Health Canada has proposed strict guidelines for shipping and security that includes a means of tracking the package during transit. (See the Canadian Narcotics Act Regulation 9)

Testing and Standardization

Testing dried marihuana for microbial and chemical contaminants and ensuring they are below generally accepted tolerance limits for herbal medicines for human consumption presents many new challenges for the cannabis industry. The Food Directorate Association in Canada (FDA) and other government agencies administer the regulations pertaining to food, drugs and natural health products. The enforcement and compliance activities relating to drugs and natural health products will likely become more onerous over time. CannabisRx helps our clients with the latest policy developments and standardizations recommended by health practitioners.

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