COWEN COLLABORATIVE INSIGHTS February 25, 2019 Amazon Has A Modest But Expanding Physical Footprint a 4 For CBD companies, expansion through Amazon’s retail locations and more importantly = Whole Foods’ expanding retail footprint are also attractive avenues for reaching new customers (assuming CBD companies can convince Amazon and Whole Foods to carry their products). While we currently lack insight into when CBD products may become available in Whole Foods stores, or what a regional or national rollout might look like, below we analyze Amazon’s physical footprint to highlight the potential for distribution. Amazon's expanding physical footprint is made up of a small number of Go Stores, Amazon Fresh Grocery Pickup in Seattle, Amazon Branded Book Stores and most notably its Whole Foods Market business. Whole Foods is a health focused supermarket chain based out of Austin TX that operates ~470 US locations and was purchased by Amazon in Aug '17. Since acquiring Whole Foods, Amazon has deeply integrated it with the company’s Prime offering. In combination with Amazon’s Prime Now platform, Whole Foods is now offering 2-hour delivery on thousands of in-store items in 63 cities, which account for over 50% of the US population and over 2/3rds of US GDP. Whole Foods also offers curbside pickup in over 20 markets. Figure 112 Amazon Prime Now & Same Day Delivery Top 50 US Metro Areas By 2017 GDP (%} 2017 GDP a % of ‘17 % of '17 US Amazon Prime Now AmazonPrimeFreeSame- WFM Delivery via U.S. Metropolitan Areas . 7 . . Rank Us GDP Population Available Day Delivery Prime Now 1 New York-Newark-Jersey City, NY-NJ-PA. 9.8% 6.2% v v v 2 Los Angeles-Long Beach-Anaheim, CA 5.9% 41% v v v 3 Chicago-Naperville-Elgin, IL-IN-WI 3.9% 2.9% v v v 4 Dallas-Fort Worth-Arlington, TX 3.1% 2.0% v v v 5 Washington-Arlington-Alexandria, DC-VA-MD-WV 3.0% 1.9% v v v 6 San Francisco-Oakland-Hayward, CA. 2.9% 2.2% v v v 7 Houston-The Woodlands-Sugar Land, TX 2.8% 14% v v v 8 Philadelphia-Camden-Wilming