COWEN COLLABORATIVE INSIGHTS February 25, 2019 Tinctures are the market leading form factor within CBD, which is reflected in the absolute number of companies that play across different price segments. Ona price / a mg CBD basis, Lord Jones leads the pack on premium pricing, with its tincture priced at $0.24 per mg of CBD. Lazarus falls at the opposite end of the price spectrum at $0.04 per mg of CBD. The vast number of price points throughout this segment reflects an abundance of choice for the consumer, providing options for all income cohorts. Figure 31 Notable Competition Within Tinctures Segment ee SUZ eoros ey.a5 020 CBD Tinctures by Price Segment $0.20 $0.17 $0.17 $0.17 $0.16 $0.16 $0.16 $0.16 ¢9.45 $0148943 $0.15 ‘ *? $0.11$0.11 $0.11 $0.11 $0.10 $0.09 9.08 ¢008 50.10 $0.08 $0.08 $0.08 $0.08 $0.07 $0.05 $0.04 $0.05 $0.00 2224/8 €2g4248 8/2 > 2 8BRBB Sie BEo 28 8 6 ¥ © 819 BS FE EREESETIZE = EES BY Bs[e FtTssge sg > * EB e/8 e £2 2 £ oo Y\/P B wmweBeeEe § S/T we e& Bt 5 SB EBs & 253 25 S/S Fe Ba a 2 g = 7 3 = §& a Ee = 32 zu os 7 E o 2 we ao FS oe Fs S a £ Uo& cg a rs a & 5 o § = = = Super Premium Premium Main Value (> $0.19) ($0.15-$0.19) ($0.09-$0. 14) (< $0.09) Source: Company Websites and Cowen and Company Note: Reflects price per mg of CBD; For companies with multiple SKUs, we used a straight line average In our consumer survey, of respondents who use CBD, 44% of people use tinctures as a form factor, which looks to be equally popular among both male and females. Interestingly, tincture use looks to be the most prevalent form factor among older consumers, as two-thirds of respondents within this cohort indicated use of a tincture. Tinctures look to be the most popular form factor across all income demographics, with over 50% of people using within the SSOK-S100K segment. Figure 32 Tinctures Are The Most Popular Form Factor CBD Tincture Use 9 70.0% 66.7% 60.0% sets 50.0% 43.6% 43.4% 43.8% 47.2% ; 37.4% 38.9% 40.0% 31.5% 30.0% 20.0% 10.0% 0.0% Total Male F