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Investor Deck MAY 2019


Content

3

Executive Summary

22

Marketing Strategy & Implementation

6

Project / Vision

27

Production & Sales Forecast

9

Products & Services

15

Market Analysis

31 34

Team/Management Investment Highlights


3

Executive Summary


Introduction BioCan Sciences “BioCan” is a designer,

4

manufacturer, distributor, and retailer of hemp

INDUSTRY Experts project that CBD products

derived CBD products.

market will have a compound annual

BioCan is dedicated to growing hemp, then

growth rate of 39% from 2017 through

extracting and refining the crude oil into a highly

2021.

purified concentrate using proprietary extraction

TECHNOLOGY

and distillation processes.

Own and operate hemp cultivation

BioCan is dedicated to producing and selling

and CBD extraction / manufacturing

premium oil, vape cartridges and disposable pods,

facilities in New York utilizing cutting

tinctures, capsules, and topicals to service the

edge and proprietary extraction.

exploding CBD infused products industry.

PRODUCTS Produce and sell the highest-quality CBD products through wholesale and online transactions.


Financial Summary

From a total investment of $10 million, Company is expected to generate $30 million in gross revenues with pre-tax income of $9.3 million (31%) in Year 1, its ďŹ rst full year of operations. Revenues are expected to grow to nearly $80 million in Year 2, with pre-tax income of $32 million (40%).

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6

Project Vision


Mission Statement

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To grow one of the best hemp plants and produce high-quality CBD concentrates and infused products

Main Goals: ● Partner with farmers and hemp cultivation and CBD oil extraction / manufacturing facilities in New York. ● To build a recognizable brand in a rapidly growing industry. ● To be fully compliant with all state and local municipalities. ● To have the BioCan brand become a trusted household name nationally for high quality CBD products. ● To align ourselves with investors and partners who share our values.


Business Objectives

01

02

Getting the State Cultivation and Processing licenses

Processing the hemp in a clean and compliant laboratory

Partner with hemp

Lookout for ways to improve

cultivation and GMP

our processes and maximize

manufacturing facilities in the

our returns on the hemp

state of New York.

plants we use

03

Net annual income to support operational expenses

04

Become profitable by the end of the first year of operations

Monthly sales and capacity

Maintaining a nimble operational structure

increasing steadily

and cultivation strong relationships with

throughout the first year.

wholesalers and retailers that will allow it to quickly respond to shifting customer needs

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9

Products & Services


Product & Services

10

Cultivation

Manufacturing

Distribute

Description:

Description:

Description:

Company will have the

BioCan will produce

Company intends to

ability to grow up to

high-quality CBD

distribute CBD products

68,673 plants from

product lines.

through wholesale and

seedling to ďŹ nished product in Year 1.

online transactions.


Products Revenue Structure We will strive to provide our clientele with both high-end and affordable hemp-derived CBD products. We want to build a brand that our customers will count on for professionalism, consistency, quality, and innovation. % of Revenue by Product Category: Concentrates / Tinctures Beverages, Vape & Soft Gels Topicals & Accessories

Revenue 35% 55% 10%

11


Existing Product Line

● BioCan currently offers multiple lines of hemp derived CBD products including HempLucid and Funky Farms ● Our product lines consists of water soluble liquids, MCT oils, hemp seed oils, vape / drips, concentrates, body butters / lotions, edibles, and soft gels ● Existing agreements with suppliers do not limit BioCan from selling other brands or products

12


Competitive Products

13


Select Customers

14


15

Market Analysis


2018 Farm Bill ✔ The 2018 Farm Bill defines hemp as the plant Cannabis sativa L. and any part of the plant with a delta-9 THC concentration of not more than 0.3 percent by dry weight. ✔ The 2018 Farm Bill removes hemp from the Controlled Substances Act, paving the way for the wholly legal cultivation, possession, sale and distribution of the hemp plant. ✔ The 2018 Farm Bill delegates to states and Indian tribes the broad authority to regulate and limit the production and sale of hemp and hemp products within their borders. States and Indian tribes cannot, however, limit the transportation or shipment of hemp and hemp products through their respective jurisdictions. ✔ CBD products produced from industrial hemp are no longer considered Schedule I substances, CBD products that come from marijuana plants with more than 0.3 percent THC are still federally illegal.

16


Hemp & CBD Legalization

17 ✔ In September, 2018, DEA announced that certain drug products that have been approved by FDA and which contain CBD will be considered Schedule V drugs. ✔ In December 2018, President Trump signed the bill into law making hemp legal for the first time since the 1930s and allowing it to be grown,

States with enacted hemp legislation

processed, and sold as an agricultural commodity. ✔ The farm bill completely removes from the drug schedule all hemp plants and derivatives with much higher THC levels, 0.3%.

41 states enacted the bill

3,546 licenses

78,176 acres of hemp


Market Growth

18

78,176

25,713

Overall hemp acreage reached 78,176 in 2018 recording a tripling of land under hemp from 25,713 in 2017, with the total number of hemp growing states up to 23 from 19 states, according to the American hemp advocacy group Vote Hemp. The total number of hemp licenses more than doubled, from 1,456 in 2017 to 3,546 in 2018. More universities also got involved with hemp research.


Hemp Market 18.4%

According to the Global State of Hemp Report, the hemp industry is expected to grow with a combined annual growth rate (CAGR) of 18.4% from 2018-2022 to become a $2.5-billion industry.


CBD Market Following passage of the 2018 Farm Bill, CBD producers will have much greater incentive to use hemp as their primary source for CBD ✔ The U.S. market for CBD products hit $291 million in 2017 – including both hemp and marijuana-derived sources – while the hemp CBD market has reached an estimated retail value of $145 million. In 2018, hemp-derived CBD products sales accounted for about $390 million. ✔ Hemp legalization and new methods of CBD oil extraction with a growing number of various CBD infused products available in mainstream markets will lead to an increase in consumer spending on CBD products. ✔ New Frontier Data estimates hemp-derived CBD market to reach $1.3 billion in 2022, representing a 27.2% 5-year CAGR. ✔ Brightfield Group analysts forecast that the total legal market for CBD can be worth more than $20 billion.

20


SWOT Analyses

21 STRENGTHS

Positive

Internal

Strengths S O

External

Opportunities

Negative

In New York State the weather conditions are ideal for cultivating hemp outside. BioCan Cultivation and manufacturing partners are seasoned and experienced hemp cultivators, and manufacturers for over 30 years with extensive industry knowledge.

Weaknesses

WEAKNESSES Enhanced risk of banking / ďŹ nancial / IRS scrutiny Crop loss possibility due to pests, heat, human error, etc. Lack in professional workforce for a Hemp/CBD industry High starting capital

W T Threats

OPPORTUNITIES High growth industry Hemp and hemp-derived products legalization Growing interest and demand for natural, alternative medicine Trend toward greater legalization THREATS Possible hemp/CBD law changing Testing requirements Indicators of a slowed global economy Large companies entering the market


22

Marketing Strategy & Implementation


Marketing Strategy & Positioning

23

PRODUCT QUALITY

PRICING

Company will utilize small

BioCan will set its price very

amount production to always

competitively.

TARGET MARKET

ensure that consistently high-quality products are in fresh supply.


Marketing Strategy & Positioning

PERSONALIZED SERVICE

REFERRAL NETWORKS

The management team will

We will work closely with

always be available to talk

retailers and practitioners across

with customers and potential

the state. We will establish a

customers, providing them

referral network that supports

with years of experience and

product consistency, brand

expertise.

recognition, and reliable delivery.

24


Target Customers

25

About 7% of Americans are already using CBD products, placing the potential market capacity at $16 billion by 2025

✔ According to a new analysis by Cowen & Co, CBD products use is highest among consumers aged 18 to 34. ✔ The survey also found that liquid form (tinctures) accounted for the biggest share of the market at 44%, followed by topical forms at 26%, edible forms (capsules) at 22% and drinks at 19%. ✔ CBD users consistently ranked CBD’s lack of psychoactive effects as its best feature, comparing to the price and other factors.


Marketing Plan

26 Merchandise & Event Sponsorships BioCan branded products such as shirts, hats, grinders, cases/containers, etc. Sponsor CBD-related industry events to gain brand exposure and bring the BioCan name to the forefront of the community.

Information Kits Registration forms, brochures, and general information. They will provide information on what our products are. Brochures We will produce high-quality brochures with detailed information for each product. Direct Marketing The marketing and sales strategy of BioCan will be based on generating long-term personalized relationships.

A

F E D C

B

Website We will have a professionally-design ed website.

Social Media We will have a signiďŹ cant social media presence. Appropriate forums will be monitored daily, with dedicated staff resources to be active and knowledgeable participants. We will develop a social media content strategy which will include Twitter, Facebook, Instagram, LinkedIn and YouTube.


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Production & Sales Forecast


Growing & Manufacturing Facilities The cultivation operations will take up 100 acres and will be adequate to grow up to 68,673 plants. The extraction/manufacturing premises will include extraction and distillation equipment. This facility will offer a signiďŹ cant advantage in the development and manufacture of our CBD products. We have contracted for our facilities for 1 year with options for an additional years without price increase.

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Cartridge & Disposable Pod Vape Products

BioCan cartridges include 300 milligrams CBD and they are compatible with any 510-thread battery and have been tested at <0.3 THC, making them the perfect choice. BioCan also intends to offer disposable pods, pure oil, capsules / pills and tinctures. All BioCan CBD products include Laboratory Test Results in their packaging.

29


Sales Forecast

Sales Growth

Operating Needs

Expenses Cut

Year 1: Sales are expected to start conservatively the first few months and increase steadily through the second, third and fourth quarters of the first year of operations. Cash will be retained in the business to cover cash operating needs as well as future expansion to meet the demands.

After the first year of operations, it is expected that BioCan will be able to trim expenses through realizing business efficiencies, gaining operational experience and industry knowledge.

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31

Team Management


Management Team

32

Vas Koutsogiannis Founder & CEO

Perry Hill Director Product Development Perry is a seasoned executive level natural product development manager with 6-years as Account Manager, Educator, R&D of product Development for Garden of Life Industries prior to its acquisition by Nestle in 2017. He was also responsible for all Northeast territory retail store relationships and educational management which included Wegmans, GNC, and Feel Rite to name a few. Under his tenure at Garden of life he was instrumental for GL’s average annual revenue growth of over 200% from 2012 - 2017. Prior to the Nestle acquisition he developed the first prenatal probiotic line, Fit Bar, Organic Plant Protein powder. He is currently Product Development manager for Toro Development LLC, a private New York State hemp cultivator and processor which has developed proprietary GMP extraction and manufacturing processes methods for industrial hemp and its applications. His intuitive sense and knowledge of national natural market trends has been the key to his success in the quickly evolving natural products space, which is why Toro Development was one of the few approved New York State Hemp Licensees.

Vas is currently Vice President of Sales with Arise BioScience, formerly Grander Distribution, acquired by TerrAscend Jan 15, 2019. He assisted Grander in building distributor sales from its inceptional stage to over $25M run rate within 18-months. Vas is deeply involved with national distributor relationships and personally manages most of the companies largest national distributor accounts wholesaling to thousands of stores nationwide. Vas has intimate understanding and experience of the OTC cannabis market, and ability to forecast market and regulatory movements on a national and state level. His experience in capital market transactions and relationships has been instrumental in structure and acquisition of Grander. Vas is also registered principal with ACP Capital Management (Member FINRA & SIPC). He deploys 25-years of registered financial market experience in private equity, and executive level risk advisory. Vas received a Bachelors of Science in Finance from the Stillman School of Business, Seton Hall University in 1992 and holds Series 7, 24 and 63 licenses.

Ronald P. Russo, Jr. Chief Financial Officer Ron is the former director and CFO of Cocoanut Row Capital. He has been an active member of the private equity and investment banking communities for over 26-years with key roles in brokerage operations and management, as well as strategic consulting and investment banking for emerging growth companies. Prior to CRC Ronald ws a principal advisor to Silicon Alley Capital Management, a family office where he advised on funding and actively managed several technology companies. Prior to SACM, Ronald was a FINRA registered Financial Operations Principal with Series 7, 24, 27 and 63 licenses. He received a Bachelor of Science, Business Administration, St. John’s University 1993.


Company Organization Directors

Production Department

Sales Department

Master Grower

Manager, Extraction

Admin and Logistics Personnel

Assistant

Extraction Tech

Growing Tech

33

Senior Operational Management

Operational

Inventory Manager

Security

Receptionists


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Investment Highlights


Series A Capital

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$ 10,000,000 The cost to expand our company

$ 500,000

$ 8,000,000

$ 1,500,000

Assets

Direct Costs

Operating Costs


Series A Assets & Use of Funds Start-Up Costs

Q1-4

Use of Funds first 12 Months

Feminized seed plants

$85,841

Assets

Payment for growers

$1,800,000

Administrative / Sales Cost

$1,086,683

Extraction

$900,000

Direct costs, cultivation, processing, & manufacturing Direct costs, marketing, sales and fulfillment Operating expenses, first 12 months

Reserves and R&D

$2,877,476

Executive salaries

Direct costs marketing, sales, and fulfillment

$1,500,000

Total Use of Funds

Operational Expenses

$1,300,000

Executive Salaries

$300,000

Total

$10,000,000

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$150,000 $3,872,524 $1,500,000 $1,300,000 $300,000

$7,122,524


Projected Financials YEAR 1 Gross Revenues

% OF REV

$30,000,000

YEAR 2 $80,000,000

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% OF REV 266.67% Yearly Revenue Growth %

Cost of Goods Sold

$9,900,000

33%

$22,400,000

28%

$20,100,000

67%

$57,600,000

72%

SG&A Expenses

$10,800,000

36%

$25,600,000

32%

Operating Cash Flow

$9,300,000

31%

$32,000,000

40%

Gross Profit Gross Profit % of Revenues

● Currently generating revenues in excess of $400,000 per-month ● Explosive quarter over quarter top line revenue growth ● Healthy gross margins with room for improvement


38 Forward Looking Statements Certain information included in this document contains forward-looking statements. These forward-looking statements include, among others, statements with respect to the Company’s objectives, goals and strategies to achieve those objectives and goals, as well as statements with respect to the Company’s beliefs, plans, objectives, expectations, anticipations, estimates and intentions. The words “may”, “will”, “could”, “should”, “would”, “suspect”, “outlook”, “believe”, “plan”, “anticipate”, “estimate”, “expect”, “intend”, “forecast”, “objective” and “continue” (or the negative thereof), and words and expressions of similar import, are intended to identify forward-looking statements. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, which give rise to the possibility that predictions, forecasts, projections and other forward-looking statements will not be achieved.

Thank You

Certain material factors or assumptions are applied in making forward-looking statements and actual results may differ materially from those expressed or implied in such statements. The Company cautions readers not to place undue reliance on these statements, as a number of important factors, many of which are beyond the Company’s control, could cause actual results to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited to, risks relating to industry, competition, customer, legal, taxation and accounting matters. The foregoing list of factors that may affect future results is not exhaustive. When reviewing the Company’s forward-looking statements, readers should carefully consider the foregoing factors and other uncertainties and potential events.

Contact Details Vas Koutsogiannis +1 917 776 9169 | vas@biocan.co

Copyright Copyright© 2019. BioCan Sciences, Inc. All rights reserved. The information in this document is the property of BioCan Sciences. Reproduction or transcription by any means, in whole or in part, without the prior written consent of BioCan Sciences is prohibited. This document is private and confidential and is for informational purposes only. If the reader of this document is not the intended recipient, you are hereby notified that any dissemination, distribution, copying, or use of this document is strictly

Palm Beach 340 Royal Poinciana Plaza, Ste 317 - 335 Palm Beach, FL 33480

prohibited. If you have received this document in error, please destroy or delete any copy thereof.


HEMP VENTURES, LLC Investor Deck / MAY 2019

Vape Pens Herbal, Oil & Wax Vaporizers

Designer, manufacturer, distributor, and retailer of hemp derived CBD products

Calming CBD Dog Treats Made with 100% Pure CBD Oil

RealPuff.com

BioCan.com

CBDoggy.com


Current Seed Round

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KEY INVESTMENT MERITS Founder & CEO Product Category Personel # of Shares Authorized # of Shares Outstanding # of Shareholders

Vas Koutsogiannis CBD Products 4 25 m 1m 4

Current Seed Round $

$100,000

# of Shares to be Sold

200,000

Price Per- Share % to be Sold Post Money Valuation Structure Use of Funds

$0.50 16.67% $600,000 Reg CF Legal and Marketing for Series A Round

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2019-05-06 - Investor Deck - BioCan  

2019-05-06 - Investor Deck - BioCan  

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