INVESTOR PRESENTATION€¦ · Simplified single source ordering for a full suite of products Diverse brand, white label and bulk wholesale offerings Just-in-time delivery to free

JULY 2020

INVESTOR PRESENTATIONCSE: FONE OTCQX: FLOOF FSE: F11

JULY 2020

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Statements in this presentation that are not statements of historical or current fact constitute "forward-looking information" within the meaning of Canadian securities laws and "forward-looking statements" within the meaning of United States securities laws (collectively, "forward-looking statements"). Such forward-looking statements involve known and unknown risks, uncertainties, and other unknown factors that could cause the actual results of the Company to be materially different from historical results or from any future actual results expressed or implied by such forward-looking statements. In addition to statements which explicitly describe such risks and uncertainties, readers are urged to consider statements labeled with the terms "believes," "belief," "expects," "intends," "anticipates," "potential," "should," "may," "will," "plans," "continue" or other similar expressions to be uncertain and forward-looking.

Forward-looking statements may include, without limitation, statements relating to the Company’s ability to take advantage of the U.S. cannabis opportunities; the Company’s value proposition; the projected market growth in Nevada; the strength of the tourist market in Nevada; the growing number of retail locations in Nevada; annual production and average cash cost per gram; the number of cannabis strains; extraction capabilities; manufacturing and production capabilities; distribution, sales and marketing capabilities; operational enhancements; strategic expansion; the Company’s Q2 2020 revenues; new brand partners; the launching of Lift Tickets and Heavy Hitters and the expansion of White Label Offerings in Nevada; and the Company’s ability to ensure the health and well-being of all of its employees.

The Company is indirectly involved in the manufacture, possession, use, sale and distribution of cannabis in the recreational and medicinal cannabis marketplaces in the United States through its subsidiary Cana Nevada Corp. Local state laws where Cana Nevada Corp. operates permit such activities; however, these activities are currently illegal under United States federal law. Additional information regarding this and other risks and uncertainties relating to the Company’s business are contained under the heading "Risk Factors" in the Company’s Annual Information Form dated June 23, 2020 (the "Annual Information Form") filed on its issuer profile on SEDAR at www.sedar.com.

The forward-looking statements contained in this presentation are expressly qualified in their entirety by this cautionary statement, the "Cautionary Statement regarding Forward-Looking Information" section contained in the Annual Information Form. All forward-looking statements in this presentation are made as of the date of this presentation. The forward-looking statements contained herein are also subject generally to assumptions and risks and uncertainties that are described from time to time in the Company’s public securities filings with the Canadian securities commissions, including the Company’s Annual Information Form.

Although Flower One has attempted to identify important factors that could cause actual results, performance or achievements to differ materially from those contained in the forward-looking statements, there can be other factors that cause results, performance or achievements not to be as anticipated, estimated or intended, including, but not limited to: dependence on obtaining regulatory approvals; investing in target companies or projects that are engaged in activities currently considered illegal under United States federal law; changes in laws; limited operating history; reliance on management; requirements for additional financing; competition; hindering market growth and state adoption due to inconsistent public opinion and perception of the medical-use and adult-use marijuana industry and; regulatory or political change.

Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements in this presentation are made as of the date of this presentation. Flower One Holdings disclaims and does not undertake any intention or obligation to update or revise any such forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

Disclaimer

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Our flagship facility in Nevada is one of the top yieldingfacilities in North America. Flower One has built anindustry-leading team focused on delivering on ourpromise to be the first national high-quality, low-costbrand fulfillment partner in cannabis.

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BEER

$100B+25% Penetration

Source: Market size and penetration rates based on Brewers Association (beer), Park Street (wine and spirits), Ackrell Capital (coffee), Cowen Group (cannabis year 2030). Penetration is defined as the percentage of adults consuming each respective product in the past year.

WINE & SPIRITS

$100B+20% Penetration

COFFEE

$50B+50% Penetration

CANNABIS

$80B+14% Penetration

U.S. Cannabis Opportunity

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For Our Retail Partners

For Our Brand Partners

Simplified single source ordering for a full suite of products Diverse brand, white label and bulk wholesale offerings Just-in-time delivery to free up working capital Consistency of product quality and surety of supply

Full control over supply chain ensures total traceability of products

Speed and ease of market entryEliminate high cost of capital to build dedicated facilities for individual brands Assist brands to secure all required regulatory licensesConsistent product quality with custom product fulfillment

Industry-leading cultivation analytics - lowest cash cost per gram

Strain: Purple Punch Harvest Date: 09.12.19

As the Largest Cultivator and Producer in Nevada, Flower One Provides Turnkey Solutions for Leading Cannabis Brands while also Creating Value for Cannabis Retailers.

Our Value Proposition

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Why Nevada?

400k sq. ft. largest scale, high tech commercial greenhouse in the state of Nevada

Flower One serves the entire Nevada market, including tourists near

the Las Vegas Strip and local consumers

throughout Nevada

55k sq. ft. post harvestproduction facility

25k+ sq. ft. indoor facility for R&D and

genetics library

Nevada Market Stats

2019 Cannabis Sales = $639 Million(19% Increase from 2018 Sales of $539 Million)

Flower One has the only large-scale greenhouse in Nevada

Controlled number of licensed producers

Concentrated, efficient market: 80% of cannabis sales take place within Clark County

Strong tourist market along with a notable resident cannabis customer set

70 current retail locations and growing

#2 target market for brands

Sources: Nevada Department of Taxation | Echelon Wealth Partners | Marijuana Business Daily

Square Feet Square Feet Square Feet

Flagship greenhouse, Nevada’s largest and among North

America’s top yielding with an annual production capacity

of 100K-110K pounds

Capability to process over 1,000 pounds of bulk and branded flower along with 3,000 to 5,000 pounds of

biomass into dozens of products

Current indoor cultivation and production space for testing strains from the Company's genetic library and growing

select, premium craft cannabis

And counting with industry leading brand and

distribution strategy led by cannabis industry pioneers

GREENHOUSE FACILITY

PRODUCTION FACILITY

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400K 55K 25K 16+Brand Partners

LARGEST COMMERCIAL CULTIVATION & PRODUCTION FACILITY IN NEVADA

Nevada Footprint

May 2018Start of Construction

Fully Canopied First Harvest

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Timeline

May 2019First Crop Planted

Q3 2019First Licensed Sale out of Greenhouse

Production / Extraction Lab Completed Initial Brands Launched into Market

Q4 2019

Signed Heavy Hitters as Brand Partner Approval of The Clear & Old Pal Vapes

Q1 2020

June 2019

Signed Top California Based Brand Partners – KIVA, Cookies & 22RedKIVA Camino Launch

Old Pal #1 Selling Flower Brand in NV

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Q1

Launched –KIVA Terra Bites

Huxton Pre-Rolls

Q2Launched 22Red & Cookies

Planned Launch of Lift Tickets Expansion of White Label Offerings

Q3

Launched Vape Brands -- The Clear & Old Pal

Q4

Planned Launch of Heavy Hitters

2020 Brand Launches

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Cultivation

Extraction

Manufacturing & Production

Distribution, Sales, Marketing

Brand / Market Penetration StrategyStrain: Sour SunsetHarvest Date:05.21.20

Turnkey Solution for Brand & Retail Partners

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Pounds per annual production capacity

Years of large scale greenhouse excellence

Cannabis strains

100-110K+ $0.49 25+ 150Average cashcost / gram

As of Q1 2020

Image: June 2019

Cultivation

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Ethanol, LPG and CO2 Finest full spectrumoils, distillates, and finished products

Commercial scale distillation capacity; throughput

sufficiently sized to easily meet all internal needs

Scientists, engineers and cGMP manufacturing

professionals

50kg+MultipleCapabilities

SuperiorRefinement

Top Talent

Extraction

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Exclusive partnership with #1 design build firm in U.S.

in food and beverage

Square feet of state-of-the-art production

SKUs emerging from Production Facility

Diverse product offerings, contract manufacturing, white label solutions and

biomass at scale

100+DennisGroup

ProductCapabilities55K

Manufacturing & Production

Distribution, Sales & Marketing

Just-In-Time Delivery

Dispensaries preserve working capital

Localized Sales & Marketing Experts

Launch campaigns, in-store activations

and customer loyalty14

Established Retail Partnerships

90%+ Dispensary Penetration

Leading Brand Portfolio

Top selling brands from California and beyond

Image inside one of Flower One's Nevada dispensary partners

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Brand Partnerships

Strategic Expansion

Operational Enhancements

2019 - 2020 YTD Revenue Performance

Recent Financial Performance

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Strain: Wedding CakeHarvest Date:05.21.20

Strategic Plan & Recent Financial Performance

Flower One continues to identify operational improvements to lower costs, improve cultivation methods and enhance overall product quality.

Significantly enhanced quality of Company's dry cannabis as a result of data improvements made in the crop management process.

New drying and curing techniques have resulted in improved aroma, THC levels and physical bud characteristics as well as enhanced terpene profiles.

Successfully validated Fresh Frozen harvest process to expand product offerings and continue to offer best-in-class concentrates.

Continued improvements in upstream extraction, resulting in first-pass distillate achieving 92% THC levels, on average, across all lots.

Revised, flexible crop management limits number of zones planted in order to match current market demand and reduce expenses during costlier cultivation months.

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Operational Enhancements

Total number of licenses vs. total addressable market sizes

Competitive cultivation landscape (greenhouse, outdoor, etc.)

Wholesale & retail regulatory landscape

Current inventory of distressed cannabis assets alongside the opportunity to leverage Flower One's operations and brand portfolio

Evolving partner agreements with MSO's and other private retailers

Strategic Expansion

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States with Legal Medical & Recreational Cannabis States with Legal Medical Cannabis

Key Factors:

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Q4 REVENUES$5.8M, up 128% from Q3-19

FULL YEAR REVENUES$9.5M; ahead of company guidance of $9.0M

Q1 REVENUES$8.8M; in-line with company guidance of $8M-$10M

2019

2020

Q2 PRELIMINARY UNAUDITED REVENUES$3.8M; ahead of company guidance of $3.25M-$3.75M

* All figures on this slide are in US dollarsQ2-20 preliminary unaudited revenues of $3.8M, as of the company press release dated July 15, 2020

Recent Financial Performance

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* Preliminary Q2-20 revenues of $3.8M, as of the company press release dated July 15, 2020

Revenue Performance

Reported Actual Preliminary$10M

$9M

$8M

$7M

$6M

$5M

$4M

$3M

$2M

$1M

Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020$USD

FirstHarvest

Start of Greenhouse

Sales

Launch of Production Lab/

Facility

COVID-19 State Closure

Record Monthly Sales in March

$3.9M

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Ken VillazorPresident & CEO20 years of corporate affairs experience and has held senior positions with multiple global pharmaceutical companies. Public company Director experience and 10 years as an executive and advisor to a National Hockey League franchise.

Kellen O’Keefe Chief Strategy OfficerDecade of cannabis experience leading business development, brand portfolio’s and capital sourcing. Recognized as one of the industry’s early leaders. Worked with large CPG companies in marketing and brand development.

David KaneInterim Chief Financial OfficerCertified Public Accountant with over three decades of finance and accounting experience with several roles as a Chief Financial Officer. Most recently, Mr. Kane was CFO of Xtreme Cubes Corporation, a manufacturing company, and Tryke Companies, a vertically integrated cannabis company, both located in Nevada.

Salpy Boyajian VP of Operations - NevadaFounder of NLV Organics, one of Nevada’s first cannabis companies that was subsequently acquired by Flower One and served as its entry point to the Nevada market. Serial entrepreneur and operator who has launched several other successful businesses. Has overseen Flower One’s Nevada operations from beginning to present.

Dillon KassRegulatory & ComplianceCertified geologist with 15 years of professional environmental and regulatory compliance experience. Specialist in licensing and permitting throughout all levels of government with extensive experience in the highly regulated California and Nevada markets.

Thomas RosengrenDirector of Extraction & ProductionResponsible for the implementation of data-driven methodologies to improve quality and yield of extracted products for Flower One. Successfully leveraging LEAN and Six-Sigma methodologies, Mr. Rosengren’s strategies reduce risk, waste and turnaround times, leading to improved life-cycle sustainability, quality, and margins across cultivation and extraction operations.

Ricky JefferiesDirector of Post Harvest & Fulfillment25 years experience in world-class operations – including aseptic processing, maintenance, sanitation, warehousing, food, biochemical, and pharmaceutical. Mr. Jefferies, is responsible for the implementation and oversight of a post-harvest program that sustains product quality, promotes storage viability, and generates positive economic output.

Francisco RodarteGrowerOne of Flower One’s lead growers and an instrumental part of the cultivation team. Day-to-day responsibilities include ensuring the overall health of Flower One’s plant material, cloning, light recipes, climate control, irrigation, fertilizers, and general oversight of the entire life cycle of the plant from seed to shelf.

Our Leadership Team

Bern Whitney

Mr. Whitney has over thirty-five years of diversified operational experience in the rapidly changing markets of technology, biotech, and manufacturing for both consumer and enterprise focused companies. He is currently a partner at FLG Partners, engaging as both a board advisor and CFO consultant providing strategic and operational financial guidance. In addition to his partnership at FLG, Mr. Whitney has served on the Board of Directors at digital rights developer Digimarc Corporation, where he chairs the Audit Committee and is a member of the Governance, Compensation and Special Litigation Committees. Before joining FLG, Mr. Whitney served as the Chief Financial Officer or in other senior financial management and controller roles at four global technology companies including Handspring, Inc., Sanmina Corporation (NASDAQ: SANM), Network General Corp, and Conner Peripherals, Inc., a hard drive manufacturer that went on to achieve the record of the fastest growth company in U.S. history. Mr. Whitney has also served on the Board of Directors or as an advisor to Plumtree Software (NASDAQ: PLUM), Fonality Inc., ServiceSpace, and the California State University Business School.

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Ken Villazor

Mr. Villazor has more than 20 years of experience in Corporate Affairs including communications, public relations, business development, regulatory affairs, government relations, philanthropy and public policy. He has held numerous senior positions in the pharmaceutical industry working extensively in government regulated aspects of commercial operations including formulary/market access, pricing compliance, price controls, manufacturing grants, regulatory approvals and shaping federal and provincial government policies. Mr. Villazor has been a director of Organic Garage Ltd. (TSXV:OG) since 2016 and serves on its Audit Committee, Governance Committee and Compensation Committee. He has worked for a number of large pharmaceutical companies including SmithKline Beecham, GlaxoSmithKline and Biovail Corporation as well as with the industry’s national trade association based in Ottawa. In addition, Mr. Villazor spent more than a decade in the sports and entertainment industry including having served as an Alternate Governor and advisor to a National Hockey League franchise. His Board experience spans the academic sector, not-for-profit sector and publicly-traded companies.

David Wesley

Mr. Wesley has a decade of experience in the development, implementation and operational handover of some of the largest commercial greenhouse operations in North America. He has delivered over $400 million dollars of agricultural, office, industrial and other greenfield construction. Mr. Wesley has extensive multi-national experience leading development efforts and regulatory compliance from the local city-level to federal agencies. He has experience in both private company and advisory Boards. Mr. Wesley holds a Masters Degree in Business Administration in Executive Management with a Specialization in Management Consulting, a Masters Certificate in Project Management, and Certificate in Business Administration.

Amit Varma

Mr. Varma brings with him approximately 20 years of experience in cross border corporate banking and finance roles with some of the largest financial institutions in Canada as well senior management and executive roles with some of Canada’s largest agricultural companies. Mr. Varma has worked in both large private and public companies and has been responsible for sourcing, developing, and maintaining new and existing relationships with strategic financial partners to ensure the long-term availability of adequate sources of capital including equity and debt required for the ongoing operations, planned capital expenditures and the funding of the company’s strategic initiatives including possible mergers and acquisitions. Throughout his career in both the private and public sectors, Mr. Varma has successfully delivered several billion dollars in debt and equity financing.

Molly Hemmeter

Ms. Hemmeter has over 20 years of experience leading and advising public, private and VC-backed health and wellness companies with a commitment to sustainability. She currently serves on the Board of Wilbur-Ellis and was recently the CEO, President and Director of Landec Corporation (NASDAQ: LNDC). During her 10 year career at Landec, she led the turnaround of the Curation Foods business from a commodity vegetable company to a branded natural foods company and the acquisition of Lifecore Biomedical and its subsequent organic growth into adjacent markets. Prior to Landec, she served as Vice President of Global Marketing and Business Development at Ashland Chemical, was an executive at two successful software companies that were later sold and held additional positions in strategy, marketing, engineering and operations at a number of leading chemical, pharmaceutical and consumer product companies within the U.S. Ms. Hemmeter holds a Bachelor of Science and Masters in Chemical Engineering from the University of Louisville and an MBA from Harvard Business School.

Board of Directors

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Appendix

MAY

29JUNE

4

Phase 2 of Nevada

reopening begins

All casinos, including those on Las Vegas

Strip can reopen with certain restrictions

and protocols

MAY

9

Dispensary storefronts allowed to re-open subject to specific physical distancing criteria

and protocols

MAY

1

Dispensaries permitted to

expand service to include curbside

pick-up

20MARCH

All licensed cannabis establishments are deemed essential

and are permitted to continue to operate through delivery-

only sales

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Nevada & COVID-19 | Cannabis Deemed an Essential Business

Beginning in mid-March with the on-set of COVID-19, Flower One enhanced the Company’s already stringent food-safety standards.

Flower One is committed to ensuring the health and wellbeing of all of its employees, while at the same time protecting the safety and consistency of the cannabis supply chain in Nevada.

Additional cleaning staff hired and deployed across locations

Implemented pre-cautionary disinfection process of entire facility between each shift

Shift-based employees have been properly socially distanced, with no overlay or contact between teams

Reconfiguration of production workflows to increase working distance between all non-shift employees

Onsite dispensary activations temporarily suspended to assist retail partners with managing newly adjusted in-

store customer flow and demand

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COVID-19 Operational Response Plan

Ken Villazor, President & CEO

Toronto, ONE [email protected]

Media & Investor InquiriesNATIONAL Capital Markets Toronto, ONT 416.848.9835E [email protected]

Kellen O’Keefe, Chief Strategy Officer

Los Angeles, CAE [email protected]

ADDO Investor RelationsLos Angeles, CAT 310.829.5400E [email protected]

David Kane, Interim Chief Financial Officer

Las Vegas, NVE [email protected]

Media InquiriesE [email protected]

Contact