THE SCIENCE OF CHANGING LIVES - Constant Contactfiles.constantcontact.com/e625af0d101/d937c8b9-139e-4e32-bef2-b2d… · THE SCIENCE OF CHANGING LIVES INVESTOR PRESENTATION ... IBM

WWW.GREENSKYLABS.COM

THE SCIENCE OF CHANGING LIVESINVESTOR PRESENTATION

AUGUST 2017All information in this presentation is confidential and proprietary.

DISCLAIMER

THE SCIENCE OF CHANGING LIVES

INVESTOR PRESENTATION2

This management presentation is intended to provide an overview of the business of Green Sky Labs Inc. (“GSL”, the “Company”). It has

been prepared for information purposes only and does not purport to be complete.

The presentation contains statements that, to the extent that they are not historical fact, may constitute “forward-looking statements”

within the meaning of applicable securities legislation. Forward-looking statements in this presentation include, but are not limited to,

statements regarding GSL’s potential acquisition growth and GSL’s beliefs regarding the future prospects for the medical marijuana

industry. In addition to these statements, any statements regarding future plans, objectives, or economic performance of GSL, or the

assumption underlying any of the foregoing, constitute forward-looking information. This presentation uses words such as “may”, “would”,

“will”, “likely”, “expect”, “anticipate”, “believe”, “intend”, “plan”, “forecast”, “project”, “estimate”, “outlook”, and other similar expressions to

identify forward-looking statements. Actual results, performance, or achievement could differ materially from that expressed in, or implied

by, any forward-looking statements in this presentation, and accordingly, readers should not place undue reliance on any such forward-

looking statements. Forward-looking involves significant risks, assumptions, uncertainties, and other factors that accordingly, should not

be read as guarantees of future performance or results. These risks and uncertainties include the business of acquiring and owning real

property including the following: government regulation and environmental matters; illiquidity; uninsured losses; investment concentration;

competition; acquisition strategy; reliance on key personnel; integration of additional properties; debt financing; interest rates; litigation;

restrictive covenants; joint venture investments; potential undisclosed liabilities associated with acquisitions; reliance on external sources

of capital and other factors. Due to the potential impact of these factors, any forward-looking statements speak only as of the date on

which such information is made and GSL disclaims any intention or obligation to update or revise any forward-looking information, and it

is not possible for management to predict all of such factors and to assess in advance the impact of each factor on GSL’s business or the

extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking

statements.

Investments have risks – principal and returns not guaranteed.



GSL will be a technology leader in the hemp and marijuana industries and has invested over $20M CAD over the past 7

years to develop its proprietary and revolutionary methods of extraction and isolation technologies for CBD, THC and

other cannabinoids.

GSL has acquired exclusive global rights to the most sophisticated membrane isolation technologies from the world’s

leading membrane technology development firm, Petro Sep Corp. (“Petro Sep”). This high-volume technology will

position GSL and its partners to take advantage of the rapid demand growth of the global cannabinoid extraction and

isolation industry.

Collaboration partners for further research, pharmaceutical trials and further business development include the following:

Head Office: Victoria, BC

Satellite Offices (Canada): Vancouver, BC & Toronto, ON

Satellite Offices (US): Kirkland, WA (USA)

Incorporated: Calgary, AB (2014)

Victoria Innovation Advanced

Technology and Entrepreneurship

Council

2016 Start Up of the Year

COMPANY OVERVIEW



❖ The multi-billion dollar cannabinoid extraction and isolation industry is growing rapidly as

many jurisdictions across the globe are legalizing cannabis, particularly in the medicinal

space. With its proprietary technology, GSL is forming partnerships globally in order to be a

world-class market leader within the cannabis industry.

❖ GSL plans to capture market share through three key divisions:

(1) Isolation & Extraction: GSL’s Isolation and Extraction division has developed two key proprietary

extraction and isolation methods to produce cannabinoid isolates: (i) Membrane Technology for use

in large scale production and (ii) Solvent-Based Technology for use in small to mid scale production.

(2) Pharmaceutical Division: GSL plans to vertically integrate into the Pharmaceutical industry through

our Pharma Division. The Pharma Division will be able to leverage GSL’s high purity isolates in order

to potentially create indication-specific formulations for use in clinical trials for ALS, pain, PTSD as well

as a bio-equivalency trial to use our THC isolate as a natural and generic alternative to Marinol.

(3) IBM Watson Partnership: GSL in association with IBM Watson is developing “AskWatson Pain”,

which is a web portal designed to provide patients and practitioners with the most current information

on alternative treatments for pain mitigation. Treatment options, such as cannabis-based

pharmaceuticals and nutraceuticals, will be to researched and offered to counter the opioid epidemic

that is occurring across North America.

EXECUTIVE SUMMARY



GROUP ORGANIZATIONAL CHART

GSL

Parent

Company

GSL

Isolation &

Extraction

GSL

Pharma

GSL IBM

Watson

Partnership



❖ Cannabis can be produced as marijuana or as hemp.

❖ Marijuana is generally grown indoors in highly regulated

environments and is the feedstock input for the production of

tetrahydrocannabinol (“THC”).

❖ Hemp is generally grown as a cash crop in agricultural form

similar to other commodities such as corn and soy. Hemp is

the feedstock input for the production of cannabidiol (“CBD”).

❖ Due to restrictive regulations on growing methods, marijuana

is much more expensive than hemp.

❖ Although there are other cannabinoids that can be obtained

from the cannabis plant, the vast majority of market demand

is associated with CBD and THC.

CANNABIS MARKET OVERVIEW

PRODUCT OVERVIEWCANNABIDIOL (CBD)



CBD’s appeal to consumers is that it is a THC-free, non-psychoactive compound derived from hemp

which has many of the same medicinal properties found in marijuana, as well as others not attributed

to marijuana, but without the psychoactive side effects, or “high.”

CBD is one of over 60 compounds found in cannabis that belong to a class of molecules called

cannabinoids. Of these compounds CBD and THC are usually present in the highest concentrations, and

are therefore the most recognized and studied.

Unlike THC, CBD does not cause a high because it does not act on the same pathways as THC.

Numerous studies suggest that CBD acts to reduce the intoxicating effects of THC, such as

memory impairment and paranoia.

Studies have found CBD to possess the following medical properties:

• Anticonvulsant (suppress seizure activity)

• Antipsychotic (combats psychosis disorders)

• Anti-inflammatory (combats inflammatory disorders)

• Anti-tumoral (combats tumor and cancer cells)

CBD

is a key

Ingredient in

Cannabis &

Hemp

CBD

is Non-

Psychoactive

CBD

has a wide range

of Medical

Benefits



PRODUCT OVERVIEWMEDICAL USES



CBD is Non-

Psychoactive

PRODUCT OVERVIEWANTICIPATED MEDICAL USES

MARKET OVERVIEWGLOBAL CANNABIS INDUSTRY



$50+ Billion

45+ Million

$2+ Billion

Global Market by 2020.

Global Number of

Consumers by 2020.

Cannabidiol (CBD) market

in United States by 2020.

MARKET OVERVIEWGLOBAL CANNABIS INDUSTRY



“The Hemp Business Journal estimated that the CBD market will grow to a $2.1

billion market in consumer sales by

2020 with $450 million of those

sales coming from hemp-based

sources. That's a 700% increase

from 2016.”1

(1) Source: “The Cannabis Market That Could Grow 700% By 2020”. Debra Borchardt. Forbes. Dec 12, 2016.



MARKET OVERVIEW

(1) Source: The State of Legal Marijuana Markets – 5th Edition, Published by Arcview Market Research.

“Very few consumer industry categories reach $5 billion in

annual spending and then post anything like

25% compound annual growth across

the following five years. Cable television came close, growing 19% annually in the

late 1980s as national networks like CNN

and HBO proved to be wildly popular.

Broadband internet subscription spending grew 29% per annum in the early 2000s as it

became almost as much of a “must have” utility as electricity or

television for the modern home.”1

“The legal cannabis industry accelerated at a remarkable pace in 2016. North American consumers spent $6.7 billion on legal cannabis products, up 34% from 2015.”1



❖ Product proliferation throughout

the industry is leading to

significant increases in demand

for pure cannabis extracts of both

THC and CBD.

❖ The industry is racing to improve

high grades of both CBD & THC,

at lowest possible production

costs, which is leading to an

increased focus on extraction

methodologies.

MARKET OVERVIEWLEGALIZATION THROUGHT U.S.



EXTRACTIONTo generate supercritical CO2, liquid CO2 is compressed

with a pump and the temperature is adjusted. Then the

supercritical Co2 passes through the biomass and

extracts the soluble substances.

SEPARATIONTo separate the extract from the CO2, the pressure is

reduced. Thus the CO2 loses its solvent properties and the

extracts precipitate into separators. Optionally two fractions

can be produced in one extraction process by regulating

the conditions step by step.

CO2 RECOVERYAfter separation, the recovered Carbon Dioxide is

liquefied in a condenser and recirculated.

❖ Butane or BHO can contain

harmful trace contaminants

❖ Extreme explosion hazards when

using high pressure solvents

❖ High cost, labor intensive process

❖ Limited output and scalability

❖ Loss of cannabinoids

DISADVANTAGES:Traditional Butane and Carbon Dioxide

methods pose several health and

safety concerns for example:

STEP 1 STEP 2

INPUT

EXTRACTION

VESSEL

TEMPERATURE

ADJUSTMENT

HIGH-PRESSURE PUMP CO2 STORAGE

EVAPORATOR 1 EVAPORATOR 2

SEPARATOR 1

FRACTION 1

SEPARATOR 2

FRACTION 2

CONDENSER

EXTRACTION AND ISOLATIONCURRENT METHODS



GSL’s has developed two key proprietary extraction and isolation methods to produce

cannabinoid isolates: (1) Membrane Technology and (2) Solvent-Based Technology:

(1) GSL’s Membrane Technology (Large Scale): GSL has partnered with Petro Sep based

out of Oakville, Ontario to develop a proprietary membrane technology which will be used

for the large scale extraction and isolation of cannabinoids. Petro Sep has over one

thousand employees with offices in Canada, Malaysia and China. Petro Sep manufactures

proprietary membranes which have been successfully used for a variety of separation

applications for the chemical, petrochemical and food industries over the past decades.

Through exclusive global rights on the use of Petro Sep’s membranes, GSL has developed

a process to allow for the large scale production of high quality extracts and isolates at low

costs.

(2) GSL’s Solvent-Based Technology (Small-Mid Scale): GSL’s proprietary solvent-based

technology produces highly purified isolates that can be easily used for small to medium

scale production.

EXTRACTION AND ISOLATIONTECHNOLOGY OVERVIEW



MULTI-KILO

FEED

WATER (H2O)

LIGHT

TERMPENES

SEPARATED

HEAVY

TERPENES

WITH

CANNABINOIDS

CBD

THC

CBD / THC

99%HEATER

EXTRACTION AND ISOLATIONPETRO SEP PROPRIETARY MEMBRANES

STAGE 1Dry leaves of hemp or

marijuana can be used as

well as extracts. Heating at

relatively low temperature

produces extract with

terpenes and cannabinoids.

STAGE 2Petro Sep’s proprietary

AZEO-SEP membrane is

used to separate water

from the terpenes and

cannabinoids.

STAGE 3Fractional distillation to be

sued to further separate

terpenes and cannabinoids

at high levels of purity.

INPUT OUTPUTV-SEP

A-SEPINPUT TO PRODUCE 1 KG

OUTPUT OF 1 KG PRODUCT

GSL Exclusive Membrane Technology - Financial Summary (per kg)

17

NET PROFIT (pre-tax)CBD: $7,163 US/kg

THC: $12,616 US/kg

Key Financial Metrics* (US) CBD THC

Net Revenue (per kg) $9,500 $23,750

Cost of Goods Sold (per kg) $1,677 $10,909

Operating Cost (per kg) $660 $225

Feedstock

Input

Cost of Input

(per kg) (US)

Input Required

(per kg of output)

Hemp

(to produce CBD)

$25 20 kg of Hemp to produce 1

kg of CBD

Marijuana

(to produce THC)

$1,250 6.7 kg of Cannabis to

produce 1 kg of THC

Output Product Purity

Wholesale Selling Price

(per kg) (US)

THC 99.9% $25,000

THC acid 99.9% $25,000

CBD 99.9% $10,000

CBD acid 99.9% $10,000

*Average financial metrics for Years 1 to 5.



EXTRACTION AND ISOLATIONPETRO SEP PROPRIETARY MEMBRANES



EXTRACTION AND ISOLATIONCOMPARISON OF METHODS

GSL is bringing disruptive technological innovation to extraction and isolation that allows us to create the highest

quality and lowest cost isolates, which create transformational supply/economies of scale to an existing industry.

In addition, GSL’s proprietary extraction and isolation technologies have a unique first to market competitive

advantage to provide the following:

❖ High efficacy alternative medicines using no solvents

❖ Consistent, exact dose medicines for patients

❖ Lower extraction and isolation production costs of approximately 1/10th less than current methods

❖ Full spectrum isolation to capture and separate terpenes and cannabinoids individually

❖ Ability to custom formulate new medicine to create various pharmaceutical and nutraceutical products

❖ Scalable process to facilitate the increasing demand of large volume cannabinoid isolates worldwide

❖ Safe, low risk laboratories with non-explosive and non-flammable solvents

EXTRACTION AND ISOLATIONCOMPETITIVE ADVANTAGE



High quality extracted oils

Functional foods, edibles

Custom nutraceuticals/pharmaceuticals

❖ Use of the world’s leading

membrane technology

manufactured by Petro Sep.

❖ Membrane technology

currently used in multiple

industries and deployed

internationally.

❖ GSL holds global exclusivity

for use of membrane

technology to isolate

cannabinoids for cannabis and

hemp plants.

❖ Ability to recycle solvents and

produce in energy efficient and

environmentally friendly

manner THC-A and CBD-A

production without use of

solvents.

$35MYear 1

5,000 kg

$44MYear 2

6,250 kg

$48M

Annual Revenue

(US) Net Annual Earnings

(pre-tax) (US)

$59M

Annual Production

(US)

$54M Year 3

7,500 kg $71M

$64MYear 4

8,750 kg $83M

❖ CBD average sale price per

kilogram is $10,000 US.

❖ Capital investment required to

build GSL Membrane Technology

Production Facility is $11M US.

❖ Gross profit margin is 82%.

❖ Annual average fixed operating

costs over next 5 years is $4.7M

US.

❖ Production facility scalable to

match demand.

❖ Plant construction/setup lead time

of 9 months.

❖ Initial plants slated for Canada

and USA.

Technology Advantage Projected Annual Earnings per Facility for CBD Assumptions

Year 5

10,000 kg $95M $73M



GSL Exclusive Membrane Technology – CBD Financial Summary (5 year)

EXTRACTION AND ISOLATIONFINANCIAL SUMMARY

$188MYear 1

15,000 kg

$236MYear 2

18,750 kg

$356M

Annual Revenue

(US) Net Annual Earnings

(pre-tax) (US)

$445M

Annual Production

(US)

$284M Year 3

22,500 kg $534M

$332MYear 4

26,250 kg $623M

❖ THC average sale price per kilogram

is assumed to be $25,000 US.

❖ Capital investment required to build

GSL Membrane Technology

Production Facility is $11M US.

❖ Gross profit margin is 46%.

❖ Annual average fixed operating costs

over next 5 years is $4.8M US.

❖ Production facility scalable to match

demand.

❖ Plant construction/setup lead time of 9

months.

❖ Initial plants slated for Canada and

USA.

Projected Annual Earnings per Facility for THC Assumptions

Year 5

30,000 kg $713M $380M



GSL Exclusive Membrane Technology – THC Financial Summary (5 year)

EXTRACTION AND ISOLATIONFINANCIAL SUMMARY



❖ The Pharmaceutical Division of GSL (“GSL Pharma”) will focus on research and development along with

clinical trials for selected treatments using custom formulations developed from GSL’s proprietary

technology.

❖ GSL Pharma will develop proprietary and strain independent product portfolios using the output from GSL’s

proprietary technology for the following:

➢ 3 disease-specific custom cannabinoid pharmaceutical formulations: ALS, post-operative pain, PTSD

➢ 1 all-natural alternative Δ9-THC generic formulation

➢ Pharmaceutical and nutraceutical pipeline supported by peptide, probiotic, new molecule and drug delivery

enhancements and additions

❖ GSL Pharma will operate in high profile and high value markets facilitating market share and revenue via

new patient acquisition and recreational to medicinal patient migration.

❖ GSL Pharma will leverage clinical relationships for rapid, low cost bio-equivalency and partner sponsored

Phase II clinical trials.

❖ Exit strategy for individual formulations that have passed Phase II clinical trials will be to sell or license these

formulations to larger pharmaceutical companies.

PHARMACEUTICAL DIVISION



PHARMACEUTICAL DIVISION

Project Diseases Treated

Pre-Clinical

Chemo Induced Nausea;

HIV/AIDS Appetite Stimulant

Pre-emptive surgical analgesia

Zoloft, Praxil,

Effexir Replacement

(SSRI’s, SNRIs)

Cannabinoids with

Optimized Delivery

ALS Symptom Management

Study completion/

ResultsDivest

Completed Bioequivalence Study;

Divest & Approve

FY 2017 ≥FY 2019 - 2020≥FY 2018

BE complete Q3 2018 Out License

Completed Phase II Q4 2017 Results Q2/Q4 2018 Out License

Completed Phase II Q4 2017 Q3 2018 completion Q1 2019 Results

Phase II

Completed In Phase II Q 2 2018 Q1 2019 completionQ3/Q4

2019Results

Future Opportunities

Cannabinoids +

Peptides, Probiotics

License DD technology

Out License Q2/Q3 2019

Out License Q4 2019/

Q1 2020

Manufacture Launch Q3 2019Channel partner

and demand

Custom formulation and testing

Dronabinol Δ9-THC

(Marinol Replacement)

ALS

(Customized Formulation)

Pain Formulas

(Customized Formulations)

PTSD


Nutraceutical


Enhanced

(Customized Formulations

and Formats)

Estimated Project Timelines



❖ GSL has partnered with IBM Watson to develop one of the world’s most effective diagnostic

support tools – a web portal for pain mitigation, called “AskWatson Pain”. It will offer smart search

analytics and cognitive support, specifically designed to help both patients and practitioners

manage a wide variety of pain conditions.

❖ Through this portal, GSL will create two versions of a smart phone/mobile application:

➢ A free condition-based search app with advertisements

➢ An enhanced personal health management tool, which is a paid app

❖ Patient will enter pain symptoms and the application will query them and recommend treatment

options, which will include both complementary and alternative medicine.

❖ Practitioners will have access to the Watson data, via a professional services interface. This will

allow for the consideration of multiple evidence-based conventional and alternative treatment

options, which are supported by the clinical and academic literature.

❖ Revenues will be earned through advertisements, subscription fees from individuals, and group

subscription fees earned from both hospitals and insurance providers.

IBM WATSON PARTNERSHIP



IBM WATSON

Mobile Application Dashboard Pain Portal Conceptual Architecture



❖ GSL seeks to offer 9 million common shares of the Company at a

price of $1.05 US per share.

❖ GSL is concurrently doing a raise with a Canadian based brokerage

for an additional 1.5 million common shares in order to increase its

working capital.

❖ Currently, GSL has approximately 49 million common shares issued

and outstanding, with 53 million common shares fully diluted.

❖ The Company has only common shares issued and outstanding.

❖ These would be the last private share offerings of the GSL parent

company before the public offering.

COMMON SHARE OFFERING



❖ GSL seeks to raise $9,450,000 USD by way of a common share private placement offering (the

“Offering”).

❖ The net proceeds to GSL from the Offering are estimated at $8,450,000 after the deduction of commission

expense payable to the Agent(s) and expenses related to the Offering, including legal fees.

❖ The Company has the following planned expenditures to which the net proceeds of the Offering will be

applied:

❖While GSL currently anticipates that the net proceeds of the Offering will be used as set forth above, GSL may re-allocate the

net proceeds of the Offering from time to time, having consideration to GSL’s strategy relative to the market and other

conditions in effect at the applicable time.

COMMON SHARE OFFERINGUSE OF PROCEEDS

Proceeds Allocated

Global Exclusivity Licensing Fee (Petro Sep) $2,000,000

Membrane Technology Plant Engineering & Design Cost (Petro Sep) $2,000,000

Build Out & Working Capital for Kirkland, Washington Solvent-Based Plant $2,000,000

IBM Watson Division Development $950,000

Pharmaceutical Division Development $500,000

General Working Capital for GSL $1,000,000

Total $8,450,000



LEADERSHIP

Board of Directors

President and Founder, Green Sky Labs Inc.

• Founded Green Sky Labs in 2012

• Founder, President and CEO (1998-2010) of Graw Real Estate

Corporation with interests in Real Estate development in Calgary and

West Vancouver.

• Invested $4MM into Green Sky Labs prior to 2014.

Mike Graw Sam Sherwitz

Co-Founder, Green Sky Labs Inc.

• Founder, President and CEO of Evergreen LED (2000-2016)

• Founder, President and CEO of LED Sign Supply (2014-2016)

• Both LED companies are the largest privately held LED technology firms

in Canada.

• Invested $1MM into Green Sky Lab prior to 2014.

Co-Founder, Green Sky Labs Inc.

• Founder and President of Yigeda Lighting and Environmental Systems.

• Owner of TonRenTang, established in 1669 which is the largest

producer of Traditional Chinese Medicine in the world.

• Invested $3M into Green Sky Labs through asset transfer prior to 2014.

Travis Chan

Our leadership team has built and

managed multi-million & billion dollar

companies.

Founders own a significant percent

of the company and have contributed

significant capital and time in setting

up operations.

Many of the key advisors, employees

and consultants have personally

invested in GSL.

David Johnson

Member, Board of Directors• Currently Managing Partner with The Blackstone Group.

• Former Senior VP of Business and Corporate Development at Dell Inc.

where he was responsible for corporate strategy, development and

acquisition integration.

• Former 27 career with IBM prior to Dell in a Senior VP capacity in

Strategy (Corporate Acquisitions and Mergers).

321



LEADERSHIP

Company Management

Chief Operating Officer

• Started up business lines in retail banking, mortgages, wealth and

insurance for Meridian Credit Union & CIBC.

• Prior to banking, worked in the petro-chemical industry launching

numerous innovations in the utility, waste-water treatment and refining

process for Petro Canada.

Robert Leaker, COO Sarwat Anwer, CFO

Chief Financial Officer

• CPA, CA with 7 years of management experience in the Securities

Industry (IIROC Dealer Members).

• Experience working with US publicly listed companies/US GAAP.

• Previous positions include public accounting practice experience with

KPMG LLP and Tax & Treasury positions with GlaxoSmithKline Inc.

Chief Executive Officer

• Over 20 years of experience in investment banking and

entrepreneurship.

• Structured and funded a number of leading edge companies in the bio-

technology and information technology space.

• Guest speaker on finance at a variety of conferences and universities

across Canada and internationally.

Rehan Huda, CEO Paul Carpanini, CSO

Chief Strategy Officer

• Chartered Financial Analyst and MBA

• Over 25 years of experience in marketing institutional investment

management services, mergers and acquisitions and international

market expansion. .

• Experience in land development and entrepreneurial start-up ventures.

.


INVESTOR PRESENTATION

Contact:Rehan HudaChief Executive [email protected]

14

mailto:[email protected]

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THE SCIENCE OF CHANGING LIVES - Constant Contactfiles.constantcontact.com/e625af0d101/d937c8b9-139e-4e32-bef2-b2d… · THE SCIENCE OF CHANGING LIVES INVESTOR PRESENTATION ... IBM