The event will be available to you after you've completed the C class qualifying round. Find a group of ninja, near the shop, next to the C Rank Tournament Reception. After initiating the conversation, select the option "Join with me", to, after a few moments, learn about your next assignment - you will have to find the illusive mirage flower. In return, the three ninjas will be available to use as allies during the ninja tournament.
Kabuto himself will give you an important hint - the three ninjas have already searched C Rank terrain, you will have to search that of D Rank. It grows on top of high places, located near the Festival Beach and Shrine Gate Valley. At the beginning climb up the ladder next to the D Rank Tournament Reception (point 1 on the screenshot), collect the flower to learn that it was a mirage. Jump down and go to the place marked with point 2 on the screenshot above - there there's a second flower, which is, unfortunately a mirage too.
The third flower is located near the place in which you've began the previous ally event (point 3 on the screenshot above). This one will too be a mirage. The last one, and this time the real plant, can be found North to your actual position (point 4 on the screenshot above). Climb up the ladder, pick up the flower and go back to Orochimaru to finish the quest.
You will be given:
2x Paper Bomb - strong
Ninja World Tournament allies: Orochimaru, Kabuto, Kimimaro.