E-CIG SPEAKER SERIES

Jan Andries Verleur CEO, VMR PRODUCTS

JULY 2, 2014

Consumer Staples Team

ARE VAPORIZERS TAKING SHARE FROM BIG TOBACCO’S E-CIGS?

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The Vertically Integrated Electronic Cigarette

Company

June 2014

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VMR Basics VMR Products (V2®) is the largest vertically integrated electronic cigarette company in the world. • Founded: Summer 2009 (Incorporated April 2010)

• World’s largest online retailer of electronic cigarette products

• Current Recurring Customers: 350,000+ (Total Customers = 1.2M+)

• Over 20,000 new/recurring customers added monthly

• Employees: 225+ worldwide (150+ Miami, USA)

• Engineering Staff of 50+ (China and USA)

• Dedicated Manufacturing Staff: 3,000+ (Manufacturing Partners) • The company added 100,000+ square feet of dedicated factory

operations in 2013

• 30+ Patents Filed Both Domestically and Abroad

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VMR Basics VMR Products is an industry leader in the following categories:

VMR is always paving the way with revolutionary and

disruptive technology and offerings in the electronic

cigarette space. VMR boasts a healthy pipeline of R&D

initiatives, ensuring years of new product launches.

The VMR QC Process is unparalleled in the electronic cigarette industry. Proprietary

testing equipment and methodologies enable us to have

the lowest defect ratios in the category. Most notably, VMR is

the only major electronic cigarette company to publish e- liquid batch reports directly to

consumers.

VMR is the only vertically integrated company in the

electronic cigarette space. From sub-component sourcing to

consumer marketing, VMR is a completely soup-to-nuts

operation.

V2 is a globally recognized brand and is sold in over 30 countries. With over 1M+ customers in our database, VMR owns the largest database of confirmed electronic cigarette consumers in the world.

INNOVATION QUALITY VERTICAL

INTEGRATION OUR

BRANDS

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VMR Basics: Global Presence

China • Regional HQ (Futian)

• Shenzhen, China • 1 Dedicated Factory

• Shenzhen, China • 3,000+ Dedicated

Workers • Sub-Component

Warehousing & QC Center

• Shenzhen, China

Europe • EU Regional Office

• Hamburg, Germany • EU Distribution Center

• Prague, Czech Republic • Mall Kiosk @ Palladium Mall

• Prague, Czech Republic The Americas • Corporate Office

• Miami, Florida • U.S. Distribution Center/QC

Center • Under Construction • Miami, Florida

• E-Liquid MFG Facility • Under Construction • Miami, Florida

VMR Franchise Offices • UK Regional HQ

• Peterborough, England • CIS Regional HQ

• Moscow, Russia • Ecuador Regional HQ

• Quito, Ecuador • Costa Rica Regional HQ

• San Jose, Costa Rica

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VMR Brands

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VMR Brands

V2® is America’s No. 1 online brand of electronic cigarettes. The company’s flagship web-site, v2cigs.com is currently ranked in the top 1500 web-sites in the U.S., and receives more than six million monthly unique visitors, as tracked by online web-metrics provider Alexa.com. V2 Cigs has distinguished itself as a leader in the industry for its powerful vapor production and great taste.

In a short time frame, V2 has become the 3rd

most sold brand at retail in the United States, with over 40,000 retail outlets.

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VMR Brands

V2® Pro, launching July 2014, represents VMR’s entry into the large-scale vaporizer category. These products will compete in the emerging liquid/tank area of the vapor category, as well as with loose leaf vaporizer products like the PAX. These products are open system devices, designed to vaporize multiple consumable mediums including tobacco solids, e-liquids, and alternative mediums like e-gels and waxes.

Smart cartridge technology makes these devices backwards compatible with future mediums. They are disruptive in pricing and capability. Offering a gold performance standard whether the user is vaping solid tobacco or e-liquid. Proprietary magnetic cartridge and charger coupling are core features of these devices.

The V2 Pro line includes three feature-rich models: the Value (Series 3), the Mid-Range (Series 7) and the Game Changer (Series 9).

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VMR Brands

Vapor Couture™ is the only line of e-cigarettes and accessories designed exclusively for women. Slim, elegant and available in four distinct shades, Vapor Couture is not simply a premium product – it’s also an eye-catching accessory.

Vapor Couture combines the robust technology of V2 with chic designs and stylish accessories. Vapor Couture features an ultra-thin, jewel-tipped rechargeable battery with flavor cartridges available in four complementary colors. Each of the six distinctive Vapor Couture cartridge flavors was hand-picked to appeal to a woman’s refined palate. With bracelets, charms and a must-have clutch, Vapor Couture has everything a woman needs to show off her e- cigs in style!

In select international markets, Vapor Couture has experienced success as a unisex brand.

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VMR is the World’s Largest Online E-Cigarette Retailer • VMR Operates 11 Online Stores (Americas, Asia, Europe & South America) • VMR ships over 3,000 online orders every day to over 30 countries • V2Cigs.com (our flagship site) is ranked in the top 1,500 websites in the U.S. (Alexa) • 6 Million+ Monthly Unique Web Visitors (Shoppers) • VMR has over 1M online customers

VMR Basics: Online

v2.com v2cigs.eu v2cigs.com/v2pro vaporcouture.com

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VMR Basics: Key domestic retailers

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VMR Basics: OEM

VMR is a very active OEM manufacturer • 10 OEM brands in the company portfolio

• Nearly 1,000 SKUs under management

• Extensive IP portfolio owned by VMR

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QC & Batch Testing

V2 brings the highest standard of quality to the electronic cigarette industry. Through batch testing, we offer a feature that is unmatched by any other e-cig company.

In an effort to provide greater transparency to our e-liquid ingredients, and to ensure quality, we make batch testing reports available for our customers. By simply entering the Batch Number on a cartridge or e- liquid package, a consumer can access a report that confirms the uniformity of ingredients between batches, certifies the nicotine content, and the absence of known contaminants of each batch.

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Corporate Transparency

Downloadable Batch Reports Published Online for all eLiquid Containing Products.

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Vertical Integration

VMR is the industry leader in vertical integration.

R&D / MANUFACTURING

• Electrical Engineering • IC Programming • Mechanical Engineering • Product Design Team • E-Liquid and Flavor Design • Rapid Prototyping Capability • Dedicated Manufacturing • Logistics • Leading QC Infrastructure

DISTRIBUTION / SALES

• In-house Advertising/PR Agency • Ecommerce Development Team • Affiliate Marketing Team • In-house Legal Department • Accounting & Finance • Merchandising and Retail Support • In-house Call Center Operations • Fulfillment Center Services

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