Ann: Updated Use of Funds, page-2

THC will make money through: • the continued sale of equipment and other products for the indoor and urban horticultural industry, predominantly for cultivation and processing of cannabis. • Successfully developing medicinal cannabis its commercialisation. • the design and construction of hydroponic greenhouses.

The success of the Company will be subject to the following key dependencies: • continuing to manufacture, distribute and sell a broad range of products for the indoor and urban horticultural industry; • maintaining and/or further developing relationships with major customers, suppliers and distributors; • maintaining the trusted reputation of its existing brands; • adding new products to its current offerings; • obtaining all necessary regulatory and government consents; • continued legislative support for medicinal cannabis; • identifying and maintain relationships with key partnerships in research and product technology

Subject to obtaining shareholder approval, the Directors are expected to receive the following amounts by way of directors’ and committee fees in the first year: • Alan Beasley (Chairman) $45,000 • Hamish MacDonald (CEO) $180,000 • John Hall $24,000 • Ian Mutton $40,000 • Mary Verschuer $50,000 • Peter Wallace $50,000 The total amount that may be paid to non-executive directors is subject to shareholder approval at a general meeting to be held on 20 March 2017. It is expected to be set at $300,000 per annum in aggregate.

The Hydroponics Company Limited (ASX: THC) thcl.com.au Canndeo Limited – Acquisition High Purity Cannabidiol (CBD) – Research, Product Development and Distribution canndeo.com Crystal Mountain and Dragon Vision – Acquisition Manufacture, Product Development and Distribution of Hydroponic equipment crystalmountainproducts.com Pegasus Agriculture – IP Sale and Purchase Agreement Epigenetic Process Technology – New plant species development New Fluid Technology – Marketing Agreement Exclusive licence – Supa-Stelth hydroponic pumps www.supastelthpumps.com Inna Water – Marketing Agreement Exclusive hydroponic rights – Inna Water water conditioner and sonic disintegrator www.innawater.com A&B Hydroponics International & Jim Barlow – Collaboration and Profit Share Agreements Commercial hydroponic greenhouse design and construction www.abhydroponics.com.au

There are no existing agreements or proposed arrangements and there are no currently proposed transactions in which the Company was, or is to be, a participant, and in which any related party had or will have a direct or indirect material interest, other than highlighted below and detailed elsewhere in this Prospectus. Alan Beasley is also an executive of Hudson Pacific Group Limited which has 100% interest in Hudson Corporate Limited which has a Corporate Services Agreement with the Company. Details of the Corporate Services Agreement are described in Section 8.13. Hamish Macdonald is also an executive director and co-owner of Pegasus Agriculture Pty Ltd, which has an IP Sale and Purchase Agreement with the Company. Details of the IP Sale and Purchase Agreement are described in Section 8.6. John Hall is a proposed executive director of the Company. He is a shareholder and director of Agri Fibre Industries Pty Ltd which has a Sale of Shares Agreement with the Company. Details of the Sale of Shares Agreement are described in Section 8.4. Additional information regarding the interests of the Directors is set out in Sections 9.9 and 9.10. The Company’s policy in respect of related party arrangements is: • a Director with a material personal interest in a matter is required to give notice to the other Directors before such a matter is considered by the Board; and • for the Board to consider such a matter, the Director who has a material personal interest is not present while the matter is being considered at the meeting and does not vote on the matter. Additional information regarding the interests of the Directors is set out in Sections 9.9 and 9.10.

Why was Hamish removed as CEO?

Is Radford better value money?

After reading prospectus my opinion is that MacDonald may have been out of his depth in managing this newly formed diverse Company.

If you have time it is worthwhile re-reading the Prospectus.  IMO