Medicine Man Technologies Inc (SHWZ)

[Drugdoctor]

During our fiscal year ended December 31, 2016, we generated revenues of $631,456, including licensing fees of $589,721 and seminar fees of $41,735, compared to revenues of $835,777 during 2015, including licensing fees of $766,957 and seminar fees of $68,820, a decrease of $204,321. Revenues decreased during 2016 as a result of fewer clients, which we believe is a result of fewer new states adopting cannabis as a legal commodity and the related initial consulting work required to be successful in securing clients in these emerging markets. At the end of 2016 we had 27 active clients compared to 29 clients in 2015. Seminar revenues decreased due to a decrease in the number of scheduled seminars from 11 in 2015 to four in 2016, as we shifted our focus to the development of new business lines in addition to adding individual consultations which we believe will potentially replace all but the larger seminar events. Though we do not view training seminars as a primary source of revenue, we have found them to be a productive method to obtain new licensing clients.