Thank you guys for being here
to the 2025 Hemp Roadshow. So this is our second installment of
the Roadshow and I appreciate everybody being here. Our first stop was Memphis
yesterday. We had a great turnout. Again, thank you guys for being
here on this Wednesday. Now I’m going to kind of go over,
I guess the intro for the night. For the day. Nashville’s
our home. We’re all here. This is where we call our home base and
we’ve got a lot of people that are here that are really important to put this
together. Shannen being one of ’em. Thank you so much. All this happen. Now I’m the first to introduce the
team. We’re group putting this on. We are Hemp Law Group in front of
you and I’ll introduce the team first. My name is Joey Fuson. I’m an attorney. Started this thing back in 2018 and
we’ve been going pretty strong since it’s been a very different ride When we started
this thing back in 2018 versus where we are in 2025, I’m Alex Little. I introduced first Alex an
attorney at Hemp Law Group. Alex is there in tie and I’ll tell you
the reason Alex is in tie is not because he is wanting to dress up today that
he’ll be on a lot of TV shows tonight. So tune in tonight, you’ll see
Alex all over national news today. Alex is one of our lawyers and also
one of our leaders at Hemp Law Group. He is a highly intelligent, highly skilled lawyer. He is also super
creative and I’ll tell you we talked about it yesterday, but in this industry and what
we’re doing now takes creativity. It doesn’t just take intelligence
and he provides both. He’s also the partner at Litson
a law firm that focuses on representing high profile lines of really
complicated cases and that’s what’s going to bring him tonight on the news. His partner Zack Lawson is
here tonight, not Alex Lawson. Zack Lawson. He is also a
partner and co-owner of Liston. Zack is somebody I’ve gotten to know
now for the last year or two and is also highly intelligent, highly skilled lawyer, does a lot of stuff at Hemp Law Group
and a big part of what we did Hemp Law Group, so glad to have him the other day. He wasn’t in Memphis but he’s here today
and will be continuing throughout again lit and what they do at Litson is in
addition to what they do here in the cannabis industry, Zack and Alex are a huge part of the
legal fight that had happened the last couple of years and we’re happy to have
them be the leadership here at group. Great, they’re today. Now the reason they’re on the news
is I think Alex said that he’s now successfully obtained him and Zack have
obtained the most pardon of anybody from President Trump so far. So dang. We on the news for the LY
case tonight to tune in. You. Get convicted. Clint Palmer. If you guys have been in
the hemp industry for any point of time, you guys have probably
run into Clint Palmer. There’s a lot of familiar faces here
today that I recognize and I know most of you either know about or knower. He’s been a huge part of this
industry since its beginning. He’s our compliance director at
group, but he’s also so much more. He does a lot of interaction
with our clients. He also knows more about
Canvas than anybody I know. He spent 18 years researching
this plant, soil science and MTSU, molecular bioscience PhD,
just highly knowledgeable. We’re happy to have him be a part of
him. Law group Bill Black is here. He’s just finished his
studies at Vanderbilt. He’s about to become one of
the lawyers in HE law group. He’s also a very talented young lawyer, soon to be lawyer. Batches about the
plan, batches about this company. He’s going to be a big part of
HE blog group going forward. And then last we have Kelley Hess. Kelley is the CEO and
pet lobbyist at the TGC. You guys are members. If you
guys are members of the TGC, then you know what TGC is about. Then you know what Kelley’s about and
she’s a big part of where we are today. She’s been along for the whole ride and
is up there fighting on Capitol Hill for the plan, the breathing plan and is the heart and
soul of TGC and she’s going to talk a little bit about at the end of the
presentation about TGC. Alright, my job today is to lay the framework
of today. What we’re going to do, we’re going to have a presentation and
then we’re going to have a q and a. So we’re not going to stop
the presentation and ask
questions. We’re going to wait for the end. We’re going to open up the floor and we
will have a big part of what we’re doing is going to be answered the questions
that you guys have about this new law, about the future and about what you
guys need to do with your respective businesses because everybody here is
maybe in a different position, right? Maybe a different part of this industry. I’ve been taking phone calls from people
for years and everybody’s little in a little different space. We have
retailers, we have manufacturers, we have some producers still and
everybody’s going to be needing to know information to help those specific
business and we hope today we can provide that to you guys and
further. Now, hip law group, a big part of what we do alliance
and if you guys have known, we already started with if you’re a
retailer for example or manufacturer, there was no rules, there was no laws. I mean the original
laws here started with just producers. If you’re a producer and grow cannabis
in Tennessee and you had rules, you had laws the very
beginning of this back in 2018, 19 and 20 and then we’ve seen kind of
the iteration of these laws for retailers from manufacturers. We’ve seen laws
come into place, we’ve seen rules, multiple forms of rules come into place. We thought we had some changes
coming and then in one day, in one move the entire bill was rewritten. You’re going to hear today
about how that happened, the origin of that and also what that
means for you going forward as a business owner. We’re going to
talk about the new laws. We’re going to talk about
understanding the new THCA ban, which is a big part of the gloom. Part of this is the THCA ban, but also we’re going to try to give
you guys some positive information, maybe give you some hope here because
there are a lot of things and as Alex will talk about in his clinical talk about
that you can do to navigate going forward with helping with that. We’re going to
do an overview of the three tier system, which is new three tier system is a
new part of this licensing product and compliance changes. We also have a C. If you have been in the bar and restaurant
business, you may have heard of A, B, C or been a part of dealing with A, B,
C, but if not, this will be new. A, B, C we believe is quite different than
the department of revenue than the TDA. Okay? Now as we talk about
transition strategies, we’re going to talk about some of the
timeline key dates and information you guys need to be aware of and then how
we can help with how we can potentially help you guys moving forward and
navigate this kind of crazy time. Now, question answer at the end. So start on that. I think I’m going
to talk about that’s our successes. I think Joey was supposed to talk about
those, going to be talking about Alex. Well before actually in all seriousness,
Joey didn’t brag himself enough. He’s like an OG in the legal world. He’s also by identity of badass lawyer.
We see him, he’s wearing a suit, he’s going to court every day
like Harvey sector with no air that’s showing. So in the last guess couple years now, we’ve represented a ton of companies
across the board, retailer, manufacturers, distributors,
we’ve handled everything. Obviously this is normal compliance
work but also handle seizures and we do check labels, all that stuff. There’s
some stats up there about all that. We also were involved in the litigation
when the part of agriculture passed or tried to pass some rules that
were in department industry. We were successful in stopping that
at least through the end of the year. Alright, so to the crux
of this, what has passed, what law has passed and what it means, I think what has passed is a bill designed to line the pockets
of the folks who got it passed, which sort of out most silver bes
in this instance that would be the benefit the most are they were derived boards
behind the new bill. You’ll see as we are talking through
it that they’re the big winners here and not the still was really
bad at the end of year and so we’re going to talk about how we
can get through that and be creative and make, but so this slide shows you what we
think are probably the four key points to the new law. The first is our envision flower van, so now will be in January a total tea standard. So selling flour you probably got until
the end of the year and then that to go away. So sell what you got it obviously frustrating. There were a lot of folks like TGC and
US and lobbyists that did a lot of really good work to get that part of the bill
out of the bill and it was thrown back in the morning of by Peter Lambert and his it passed with that in there right now
because of our injunction that we got against Department of America rules, you were good for the end of the year
unless something changes with that case. But on January one there
could be total standard and so that stuff’s out. The second point is the regulations
are shifting so as you know, if you’re in the space previously
everything was under the depart of agriculture. That’s all
going to be under A B, C. Now like I said this was
a alcohol lobby bush fill, throwing everything into their
world what we think that means. I think there’s some positives
and negatives of that. I think on the positive side, I mean the part of agriculture
didn’t really want this. They don’t really care if this industry
exists. They sort of acted that way. They passed rules, stop it
and we’re very anti-industry. I don’t think that’ll
be the approach of abc. I think they’re generally more
broken industry in one piece survive. The other side of that coin though is
that part of agriculture was pretty incompetent and unfor rules frankly we’ve
got visits for the part of agriculture the last, I mean I think they seem like
they sort of knew the space. I think what you’re going to find here
is there’s going to be probably A B, C is going to be more prepared to enforce
and they’re going to have more people in the field. They’re going to probably develop a
better understanding of the rules. They’re going to have an
interest in enforcement. So we think enforcement’s probably going
to go up and so I think that’s kind of the give and take of that change. The third and Alex is about to talk about
this more. What this bill really does, it takes our industry and tries to
reinvent it in the image of the alcohol industry and what I mean by that is
right now we have sort of two tier civic people who manufacture the products. They have relationships
with retailers and they see the three tier system of alcohol is
manufacturers or suppliers can only sell to licensed wholesalers and retailers
can only buy from licensed wholesalers. So there’s this middleman. It does, it sounds inefficient because it is. That’s not the point of this but
Alex, I’ll solve this under that. He can talk more about that and the last
thing as already already talked about server board going to be probably winning
more horizon to do already increase. Also talk more about that
CH HCA may obviously issue didn’t go our way. Manufacturing, selling or redistributing CHCA products
becomes illegal after the end of the year. The total standard
also applies to cultivating, which obviously makes that very
difficult but not worth it. Possession remains legal. This didn’t change the
criminal code in that way, but the sales won’t be and the TC demand covers
with flower base levels on factor. Any type of THA product is
covered by this total C standard. Hip beverage is carved out
under very tight rules. What you’ll notice in this bill is
things that look more like a alcohol distributor with distributor
will be in a liquor store. It’s special treatment
and so I think they get some benefits here that the products that
most of you traditionally sell do not. I think that is it for me. I’m
going to hand it over to Alex. Talk about the new system we navigate. Good morning everybody. I want to talk briefly before I start
about where everybody is in the industry. So if you’re a retailer predominantly
you can raise your hand. So vast majority of your retailers,
of retailers or anybody else, how many of you make or package your
own products that include white paper but it’s a pretty good number. How
many of you wholesale products? I know we’ve got dollar over here. Okay, the reason those three
categories matter is because you’ve got screwed by the, and I think it’s really important to
understand the statute you build in the context of what it is
trying to accomplish. If any of you work in liquor sale, anybody
your own liquor store, that’s easy. You one liquor store owner, you know how difficult it is ABC’s
on your that a lot I would opinion. But the way that liquor works is
if you are a beer manufacturer, liquid manufacturer, you can only sell to one class of people
and that is a liquor of wholesalers and if you are a liquor retailer, you can only purchase from one
class of businesses and that is a liquor wholesaler. And so essentially
what the liquor wholesalers have done is taken that model and
imported it into that industry. Why did they do that? Because they saw their margins getting
crushed by THC beverage products. So THC beverage products, so those of you who follow this should
know are the largest growing segment of sales in liquor stores.
They are wildly popular. So those few liquor whole sellers who
pull this whole market say we want to control him too. So we want you to
make this market and way we control. That is the way you have to look
at every aspect of this bill. But that’s the most important thing that
has changed is that now you are going to have to play in one
of those three spaces. You either going to have to be a supplier, a wholesaler for a only in
very limited circumstances can you do all three and very,
very rare circumstances, all three in the same location.
They’re also much higher license costs and particularly
for wholesalers for the $750,000 financial
requirement to show that you have $750,000 of funds
or a loan who a bond to be able to sell them
products to a retailer, what does that mean for each of you, all the folks who have raised their
hand and said I make or resell products. And if you’re a retailer, what that
means is you’ve got all these accounts, maybe you’ve got this company, that
company, this company you product from, not anymore starting very soon
January 1st and you’re going to have to buy all of the
product from wholesalers. So that is the lead system. It is incredibly obtuse and
inefficient and it is done for no other purpose than to protect the
profit of the middle of wholesalers. Think about what it does.
If you are a manufacturer, you make your own ies. You don’t get to
set the price for the retail price of the products because has to be set by
the retailer in large part based on what the wholesaler charges them. You get to sell to one group
of people to wholesalers. There probably won’t
be at least six or 10. You better believe they’re
going to include you make
sure they keep the same AAU very low. So it squeezes both into the spectrum
are really unfair to we’ll talk later about potential solutions to that, but that’s how the bill
is intended to operate. There are two sort of loopholes I
want to talk about. One is intended, one maybe not so much. One is C, we’ll call it the craft year
half new model. So again, because these folks who wrote
this are liquor lobbyists, that’s how they think they, so gosh,
maybe if we have people who make ies, they want to sell gummies to their
customers at their location. So if you are manufacturing of products, you can sell your own products
soon you can get a retail license in the same facility so long as your
facility meets the requirements for a manufacturer and for aco, when
you think about that, again, imagine craft beer, it they brew the beer on
site and then purchase a bit. Those craft beer coats, they want to sell cans as that broker
still have to go to the wholesale. Same situation here. If you’re
a supplier and a retailer, supplier and product, you’re an ible based and sell ’em on
site to your customers. But if you want a wholesale and elsewhere,
if some other retailer across state, you got to go through
separate wholesalers. So there also are licensing
products and compliance chains. I’ll start with sort of the most obvious
and annoying part is they raise the prices for these licenses.
Why haven’t they done that? There are two pieces they’ve done. One, the A BC is a much more active department. They have a huge staff
enforcement officer. They use that money to create that
staff to come and inspect field and do enforcement activity. And so partly the price is higher
because they’re a lot more active. The second reason is because the
law is intended purposely to reduce the number of players in the industry
is specifically there because they want less players. That’s what license costs. Now on the upside, TBA licenses will be
honored we believe until they expire. So for those of you, hopefully
all of you were licensed, you got license last probably
got an email on the last month, you renew the license, do that now, but your cost is lower and that
license stays good next July. Now unfortunately if you are a wholesaler, you may have your TDA wholesale license, but on January one you don’t comply
with a whole host of other rules and you don’t think necessarily that a B, C is going to allow you to wholesale
under an old TDA license. There are obviously strict rules. Let’s talk
about how the rules have changed. I think honestly the rules changes
are not nearly as important as the big structural rule. I think we all could have gotten along
with except for the van on THCA file. The packaging and labeling standards have
changed somewhat but not in a way that we really want to hurt folks based on
what we’ve been doing for the past year. They’re very similar. Warning
statements, ingredients, things that you are prepared or
you’ve doing us correct the past year. Same thing about marketing.
We can’t make health claims. I think if you or our client we told you
make all claims through general thing you don’t want do because we want
F FDA A, but obviously no cartoons. Those requirements as far as still
the inference is now we have a C effective right body and
forcing them and know lots of folks who never saw a PDA agent, the products for tell who they are, send label in the way that slowly
on you need to fix em. You’re not going to have that
opportunity with A, B, C. They’re going to start writing
citations pretty quickly. So you need to be beyond their
game. When it comes to labeling, don’t take it as just
a suggestion. Finally, there’s no self-checkout
or ven machine sales. So there are going to be a number of
changes, but the big ones are structural. You have to sort of pick your lane,
decide and part of this you want to play, we’re going to talk a little bit about
transition but also got to decide if you want to stay in how you want sit,
how you want to stay in the industry, what works for you. And I will tell you today it’s
not so I would’ve said last year, this may not be the industry for you
to stay in because it may be hard. The flip side, which I’ll leave you on
a good note before I hand this over is when this industry really started 20 18, 20 19 and Farmville was
match early players, some of them were the
sprint started to say, look, we can get an industry. They did
well because they were fast movers. They found an opportunity and they
took advantage. With every change, there’s new opportunities. Now they’re
just different, a different set of rules. This industry has exploded. There’s a lot of people who
within been this industry, but if you remember at the end of the day, you’ve got a whole state full of
people who want to buy your products. We know that we’ve had a huge growth and
so they’re still going to want to buy good products and you combine a way to
any product that serves their needs, go to building, there’s still
space to be in this industry. Just going to have to work a little
harder to silence space. So with that, I’m going to hand it over. The ability to talk about really how
do you get ready for the A, B, C era. Department going be by a B
through their exploration bid. That means, but from day one we fully expect
agency to sections audit and enforcement. That will
be a lot more stringent, more specific and probably more
widespread than what we’ve seen far. And flower sales, as we said remain, they go through pre firms
pre-roll for example. We’re still trying to get clarity on
that. If you are filling pre-roll, please keep track of those specifically, but please prepare now for
absolutely every possible licensing, operational change team,
patent fine roll operation, make sure everything is, you’ve
crossed every T dot everything by and you need to be incredibly
compliant. Good to see everybody here, see a lot of faces, good to see you all. Some people I haven’t met I’ve seen
and I appreciate what you’ve done. So let’s move on to what are
we going to do in 2026. So the big deal is are you going
to stay up and up new products, have more looking products to market? Are you going to close shop or
are you going to leave town and follow up in another
state and work that way? So a couple of different
ways you can do it. Probably the best way to do it
is to have all that good data. Alex mentioned people that have
customer data versus folks don’t. If you have customer data then you can
lead with that and possibly be able to shake back. There’s two good options
for that. We can talk about that later. Reach out to us about it. The big one
is being able to track that information. So SOP style, right? So it’s like you need all
of this information so you
need to get it as detailed as possible. So what could you do? We’ve got lots of
cool products that are coming out all the time. I think that’s where the creative
mind really comes out back to 2018 and what we had beverages
were just bang em just to bang really come in the past
seven years and even in the past few years there’s still lots of
really good products for us to make. We’ve just got to come up. So that’s where work with cool people
and come with new brands and you’re going to be able to come with new
products, fill some these holes. Obviously TMCA is the biggest seller.
It’s a lot harder to fill that hole. A couple ideas on that but we’ll talk
more about that. So with the SOP zone, the big thing is having
all that documentation. If you have all the product information,
the batch codes, all that stuff, it’s a lot easier to sleep at night if
you know everything about the products. But if THCA is all that you do, it’s
going to be really tough to switch. So it’s like diversify your
business as quickly as possible. More products and that you might not
even consider cannabis products pure retails. So you’re going to
have more than just cannabis. So just be ready to think outside of THCA. Now we’ve got a couple things
happening right now that are in motion. The state just dropped the public
chapter while we’re sitting here, which is something we’ve been waiting on
for like a month. So once they passed, the bill had to be signed by
the Senate, signed by the house, then it went to the governor in between
all the legal action that was going down in the federal courthouse and it took
longer and then finally the governor signed it last weeks like that.
Anyways, finally got in public chapter, which means today it just got put out, which means we have all of it in one
thing instead of having a big power of amendments helpful, it’s also
one of the things that a, B, C had to wait on before they could do
their rules and regulations. So they couldn’t start on it until they had
that public chapter. They got it today. So they’ll be starting on those rules
and ranks. There’s no timeline for that. Expect them to be quicker and
probably a lot better at it than add. Kelly and I have had a couple meetings
with them and they didn’t say they’re going to be trying to make it as straight
line as possible and like Zach said, they do historically do a good job
of trying to run rules and legs regs to be supportive of the business
as much as possible outside of the law. So we got probably three months, maybe September before we get
rules and regs from a C and then we’re in comment period
and then we have January 1st. So the top line in between now
and then we got six months. But that goes by really quick
when you get this old. So start making those plans now at the same
time we’re going to talk a little bit about opportunity for a lawsuit, but it is something that
if I own a retail store, I would 100% be planning on if I
can’t have these products or my market definitely be planning ahead and that
you’re not going to be two months out from a month out from January to go, okay,
I have to have to make major changes. Go ahead and be planning and then ensure that your TDA license
is updated like they mentioned you’re getting basically get a little six month
raise period and not have to pay that much longer fee to get a license included TCA products, flower concentrate space
all the way up until the end of the year. I’m just trying to keep in mind that hey, what am I ordering and what am I selling?
I don’t be left file in January. And so this fall is the
operational transition period
that I was kind of talking about. It’s when you’re
going to really want to, if there’s not a lawsuit pending
and we’re staring down January 1st, you need to have a plan for your business.
Whether it’s moving out of state, close the doors or just
offering limited products. You need to have that plan set. Otherwise
by the time late fall gets here, you’re really went out of time the
January 4th first. Like I said, the licenses are still good through
ag but because the laws is the law, they get been enforce on January. So even if you haven’t
borrowed a ag license, you are under the jurisdiction
then January 1st of a, B, C. So just understand that there’s a
major difference there between, oh, ags over me, they’ve got my license, I’m good. Ags got your license
that A, B, C is the enforcer. They get to show, not necessarily kicked down the door but
they have it’s well written in law that things get to show up basically.
So Governor Lee did sign it. One of the things we’re trying to do is
do some work around the election cycles for the next year. Try and get some of these
fellows that really screwed over state of Tennessee up their legislature. There’s this thing called legislative
process and they just ignore it. So we want to get people into those
elected positions that are going to do the right job and are going to
respect that legislative process. Are like 12 amendments
additive talking Kelly, I don’t dunno if you’ve ever seen
a bill of that 12 amendments. So that’s how much worth with that support who supported us? So we’ve got good legislators out there.
They’re not all bad. I’ll let you make those
decisions for yourself. But reach out to your local legislators. The easiest way to do that is just throw
in the search bar. Find my legislator. Tennessee’s got a page for that.
Don’t call your federal legislators, they don’t care. Call your
state Local legislators. They’re the ones that will actually, they get voted in on
very small vote accounts. They the ones we can actually make
changes with. So contact contractor, state reps, contractor senators ran pretty hard if they
voted against our bill. If they voted for the Cochran Amendment, tell ’em why they shouldn’t have every
bit of leadership voted can set amendment except for so to say that they’re
all mad is far from the truth because we had people from GOP that did support
us in voting against settlement. So reach out to people
that did vote against it, say thank you and they’re in
their off season. City conductor, consider doing that as
well. And also support TGC. I’ve been working with Kelly since 2018 lobbying work and there’s no one
else up there that does it. No does. There’s just no one else.
When we run the halls there, they know exactly who’s coming when they
see us coming down the halls because they know we’re broken at this point.
What can we do to help you out? Which just that transition, why we’re business get out of state right
now and set up in other states to be able to work back here. My job
is doing compliance audits, looking packaging, looking
at labels, visiting stores, and just really helping out with licensing
and just all the little things come with it. And really the big part
about our compliance program
is getting free time with these guys. So instead of
being a big retainer fee, it’s a monthly fixed cost and just one
hour with these guys generally cover stuff because their time is so, it’s a great program to be a part of.
It’s definitely something that we can help you out with. And you get in trouble.
You don’t have to pay an extra bill. You’re already in the program. If you’re
not in the program, often go other one. We just got ready. Then you’re paying
a return. So if you get in early, then you get all the added benefits.
We have a lab in our office, you can see products and I can test them
for compliance. I can do the inputs, finished products and you’re in the middle
of formulation before you get a large batch. I can test those. So a really, really good program y move out to us
via this QR code. More interested.
to the 2025 Hemp Roadshow. So this is our second installment of
the Roadshow and I appreciate everybody being here. Our first stop was Memphis
yesterday. We had a great turnout. Again, thank you guys for being
here on this Wednesday. Now I’m going to kind of go over,
I guess the intro for the night. For the day. Nashville’s
our home. We’re all here. This is where we call our home base and
we’ve got a lot of people that are here that are really important to put this
together. Shannen being one of ’em. Thank you so much. All this happen. Now I’m the first to introduce the
team. We’re group putting this on. We are Hemp Law Group in front of
you and I’ll introduce the team first. My name is Joey Fuson. I’m an attorney. Started this thing back in 2018 and
we’ve been going pretty strong since it’s been a very different ride When we started
this thing back in 2018 versus where we are in 2025, I’m Alex Little. I introduced first Alex an
attorney at Hemp Law Group. Alex is there in tie and I’ll tell you
the reason Alex is in tie is not because he is wanting to dress up today that
he’ll be on a lot of TV shows tonight. So tune in tonight, you’ll see
Alex all over national news today. Alex is one of our lawyers and also
one of our leaders at Hemp Law Group. He is a highly intelligent, highly skilled lawyer. He is also super
creative and I’ll tell you we talked about it yesterday, but in this industry and what
we’re doing now takes creativity. It doesn’t just take intelligence
and he provides both. He’s also the partner at Litson
a law firm that focuses on representing high profile lines of really
complicated cases and that’s what’s going to bring him tonight on the news. His partner Zack Lawson is
here tonight, not Alex Lawson. Zack Lawson. He is also a
partner and co-owner of Liston. Zack is somebody I’ve gotten to know
now for the last year or two and is also highly intelligent, highly skilled lawyer, does a lot of stuff at Hemp Law Group
and a big part of what we did Hemp Law Group, so glad to have him the other day. He wasn’t in Memphis but he’s here today
and will be continuing throughout again lit and what they do at Litson is in
addition to what they do here in the cannabis industry, Zack and Alex are a huge part of the
legal fight that had happened the last couple of years and we’re happy to have
them be the leadership here at group. Great, they’re today. Now the reason they’re on the news
is I think Alex said that he’s now successfully obtained him and Zack have
obtained the most pardon of anybody from President Trump so far. So dang. We on the news for the LY
case tonight to tune in. You. Get convicted. Clint Palmer. If you guys have been in
the hemp industry for any point of time, you guys have probably
run into Clint Palmer. There’s a lot of familiar faces here
today that I recognize and I know most of you either know about or knower. He’s been a huge part of this
industry since its beginning. He’s our compliance director at
group, but he’s also so much more. He does a lot of interaction
with our clients. He also knows more about
Canvas than anybody I know. He spent 18 years researching
this plant, soil science and MTSU, molecular bioscience PhD,
just highly knowledgeable. We’re happy to have him be a part of
him. Law group Bill Black is here. He’s just finished his
studies at Vanderbilt. He’s about to become one of
the lawyers in HE law group. He’s also a very talented young lawyer, soon to be lawyer. Batches about the
plan, batches about this company. He’s going to be a big part of
HE blog group going forward. And then last we have Kelley Hess. Kelley is the CEO and
pet lobbyist at the TGC. You guys are members. If you
guys are members of the TGC, then you know what TGC is about. Then you know what Kelley’s about and
she’s a big part of where we are today. She’s been along for the whole ride and
is up there fighting on Capitol Hill for the plan, the breathing plan and is the heart and
soul of TGC and she’s going to talk a little bit about at the end of the
presentation about TGC. Alright, my job today is to lay the framework
of today. What we’re going to do, we’re going to have a presentation and
then we’re going to have a q and a. So we’re not going to stop
the presentation and ask
questions. We’re going to wait for the end. We’re going to open up the floor and we
will have a big part of what we’re doing is going to be answered the questions
that you guys have about this new law, about the future and about what you
guys need to do with your respective businesses because everybody here is
maybe in a different position, right? Maybe a different part of this industry. I’ve been taking phone calls from people
for years and everybody’s little in a little different space. We have
retailers, we have manufacturers, we have some producers still and
everybody’s going to be needing to know information to help those specific
business and we hope today we can provide that to you guys and
further. Now, hip law group, a big part of what we do alliance
and if you guys have known, we already started with if you’re a
retailer for example or manufacturer, there was no rules, there was no laws. I mean the original
laws here started with just producers. If you’re a producer and grow cannabis
in Tennessee and you had rules, you had laws the very
beginning of this back in 2018, 19 and 20 and then we’ve seen kind of
the iteration of these laws for retailers from manufacturers. We’ve seen laws
come into place, we’ve seen rules, multiple forms of rules come into place. We thought we had some changes
coming and then in one day, in one move the entire bill was rewritten. You’re going to hear today
about how that happened, the origin of that and also what that
means for you going forward as a business owner. We’re going to
talk about the new laws. We’re going to talk about
understanding the new THCA ban, which is a big part of the gloom. Part of this is the THCA ban, but also we’re going to try to give
you guys some positive information, maybe give you some hope here because
there are a lot of things and as Alex will talk about in his clinical talk about
that you can do to navigate going forward with helping with that. We’re going to
do an overview of the three tier system, which is new three tier system is a
new part of this licensing product and compliance changes. We also have a C. If you have been in the bar and restaurant
business, you may have heard of A, B, C or been a part of dealing with A, B,
C, but if not, this will be new. A, B, C we believe is quite different than
the department of revenue than the TDA. Okay? Now as we talk about
transition strategies, we’re going to talk about some of the
timeline key dates and information you guys need to be aware of and then how
we can help with how we can potentially help you guys moving forward and
navigate this kind of crazy time. Now, question answer at the end. So start on that. I think I’m going
to talk about that’s our successes. I think Joey was supposed to talk about
those, going to be talking about Alex. Well before actually in all seriousness,
Joey didn’t brag himself enough. He’s like an OG in the legal world. He’s also by identity of badass lawyer.
We see him, he’s wearing a suit, he’s going to court every day
like Harvey sector with no air that’s showing. So in the last guess couple years now, we’ve represented a ton of companies
across the board, retailer, manufacturers, distributors,
we’ve handled everything. Obviously this is normal compliance
work but also handle seizures and we do check labels, all that stuff. There’s
some stats up there about all that. We also were involved in the litigation
when the part of agriculture passed or tried to pass some rules that
were in department industry. We were successful in stopping that
at least through the end of the year. Alright, so to the crux
of this, what has passed, what law has passed and what it means, I think what has passed is a bill designed to line the pockets
of the folks who got it passed, which sort of out most silver bes
in this instance that would be the benefit the most are they were derived boards
behind the new bill. You’ll see as we are talking through
it that they’re the big winners here and not the still was really
bad at the end of year and so we’re going to talk about how we
can get through that and be creative and make, but so this slide shows you what we
think are probably the four key points to the new law. The first is our envision flower van, so now will be in January a total tea standard. So selling flour you probably got until
the end of the year and then that to go away. So sell what you got it obviously frustrating. There were a lot of folks like TGC and
US and lobbyists that did a lot of really good work to get that part of the bill
out of the bill and it was thrown back in the morning of by Peter Lambert and his it passed with that in there right now
because of our injunction that we got against Department of America rules, you were good for the end of the year
unless something changes with that case. But on January one there
could be total standard and so that stuff’s out. The second point is the regulations
are shifting so as you know, if you’re in the space previously
everything was under the depart of agriculture. That’s all
going to be under A B, C. Now like I said this was
a alcohol lobby bush fill, throwing everything into their
world what we think that means. I think there’s some positives
and negatives of that. I think on the positive side, I mean the part of agriculture
didn’t really want this. They don’t really care if this industry
exists. They sort of acted that way. They passed rules, stop it
and we’re very anti-industry. I don’t think that’ll
be the approach of abc. I think they’re generally more
broken industry in one piece survive. The other side of that coin though is
that part of agriculture was pretty incompetent and unfor rules frankly we’ve
got visits for the part of agriculture the last, I mean I think they seem like
they sort of knew the space. I think what you’re going to find here
is there’s going to be probably A B, C is going to be more prepared to enforce
and they’re going to have more people in the field. They’re going to probably develop a
better understanding of the rules. They’re going to have an
interest in enforcement. So we think enforcement’s probably going
to go up and so I think that’s kind of the give and take of that change. The third and Alex is about to talk about
this more. What this bill really does, it takes our industry and tries to
reinvent it in the image of the alcohol industry and what I mean by that is
right now we have sort of two tier civic people who manufacture the products. They have relationships
with retailers and they see the three tier system of alcohol is
manufacturers or suppliers can only sell to licensed wholesalers and retailers
can only buy from licensed wholesalers. So there’s this middleman. It does, it sounds inefficient because it is. That’s not the point of this but
Alex, I’ll solve this under that. He can talk more about that and the last
thing as already already talked about server board going to be probably winning
more horizon to do already increase. Also talk more about that
CH HCA may obviously issue didn’t go our way. Manufacturing, selling or redistributing CHCA products
becomes illegal after the end of the year. The total standard
also applies to cultivating, which obviously makes that very
difficult but not worth it. Possession remains legal. This didn’t change the
criminal code in that way, but the sales won’t be and the TC demand covers
with flower base levels on factor. Any type of THA product is
covered by this total C standard. Hip beverage is carved out
under very tight rules. What you’ll notice in this bill is
things that look more like a alcohol distributor with distributor
will be in a liquor store. It’s special treatment
and so I think they get some benefits here that the products that
most of you traditionally sell do not. I think that is it for me. I’m
going to hand it over to Alex. Talk about the new system we navigate. Good morning everybody. I want to talk briefly before I start
about where everybody is in the industry. So if you’re a retailer predominantly
you can raise your hand. So vast majority of your retailers,
of retailers or anybody else, how many of you make or package your
own products that include white paper but it’s a pretty good number. How
many of you wholesale products? I know we’ve got dollar over here. Okay, the reason those three
categories matter is because you’ve got screwed by the, and I think it’s really important to
understand the statute you build in the context of what it is
trying to accomplish. If any of you work in liquor sale, anybody
your own liquor store, that’s easy. You one liquor store owner, you know how difficult it is ABC’s
on your that a lot I would opinion. But the way that liquor works is
if you are a beer manufacturer, liquid manufacturer, you can only sell to one class of people
and that is a liquor of wholesalers and if you are a liquor retailer, you can only purchase from one
class of businesses and that is a liquor wholesaler. And so essentially
what the liquor wholesalers have done is taken that model and
imported it into that industry. Why did they do that? Because they saw their margins getting
crushed by THC beverage products. So THC beverage products, so those of you who follow this should
know are the largest growing segment of sales in liquor stores.
They are wildly popular. So those few liquor whole sellers who
pull this whole market say we want to control him too. So we want you to
make this market and way we control. That is the way you have to look
at every aspect of this bill. But that’s the most important thing that
has changed is that now you are going to have to play in one
of those three spaces. You either going to have to be a supplier, a wholesaler for a only in
very limited circumstances can you do all three and very,
very rare circumstances, all three in the same location.
They’re also much higher license costs and particularly
for wholesalers for the $750,000 financial
requirement to show that you have $750,000 of funds
or a loan who a bond to be able to sell them
products to a retailer, what does that mean for each of you, all the folks who have raised their
hand and said I make or resell products. And if you’re a retailer, what that
means is you’ve got all these accounts, maybe you’ve got this company, that
company, this company you product from, not anymore starting very soon
January 1st and you’re going to have to buy all of the
product from wholesalers. So that is the lead system. It is incredibly obtuse and
inefficient and it is done for no other purpose than to protect the
profit of the middle of wholesalers. Think about what it does.
If you are a manufacturer, you make your own ies. You don’t get to
set the price for the retail price of the products because has to be set by
the retailer in large part based on what the wholesaler charges them. You get to sell to one group
of people to wholesalers. There probably won’t
be at least six or 10. You better believe they’re
going to include you make
sure they keep the same AAU very low. So it squeezes both into the spectrum
are really unfair to we’ll talk later about potential solutions to that, but that’s how the bill
is intended to operate. There are two sort of loopholes I
want to talk about. One is intended, one maybe not so much. One is C, we’ll call it the craft year
half new model. So again, because these folks who wrote
this are liquor lobbyists, that’s how they think they, so gosh,
maybe if we have people who make ies, they want to sell gummies to their
customers at their location. So if you are manufacturing of products, you can sell your own products
soon you can get a retail license in the same facility so long as your
facility meets the requirements for a manufacturer and for aco, when
you think about that, again, imagine craft beer, it they brew the beer on
site and then purchase a bit. Those craft beer coats, they want to sell cans as that broker
still have to go to the wholesale. Same situation here. If you’re
a supplier and a retailer, supplier and product, you’re an ible based and sell ’em on
site to your customers. But if you want a wholesale and elsewhere,
if some other retailer across state, you got to go through
separate wholesalers. So there also are licensing
products and compliance chains. I’ll start with sort of the most obvious
and annoying part is they raise the prices for these licenses.
Why haven’t they done that? There are two pieces they’ve done. One, the A BC is a much more active department. They have a huge staff
enforcement officer. They use that money to create that
staff to come and inspect field and do enforcement activity. And so partly the price is higher
because they’re a lot more active. The second reason is because the
law is intended purposely to reduce the number of players in the industry
is specifically there because they want less players. That’s what license costs. Now on the upside, TBA licenses will be
honored we believe until they expire. So for those of you, hopefully
all of you were licensed, you got license last probably
got an email on the last month, you renew the license, do that now, but your cost is lower and that
license stays good next July. Now unfortunately if you are a wholesaler, you may have your TDA wholesale license, but on January one you don’t comply
with a whole host of other rules and you don’t think necessarily that a B, C is going to allow you to wholesale
under an old TDA license. There are obviously strict rules. Let’s talk
about how the rules have changed. I think honestly the rules changes
are not nearly as important as the big structural rule. I think we all could have gotten along
with except for the van on THCA file. The packaging and labeling standards have
changed somewhat but not in a way that we really want to hurt folks based on
what we’ve been doing for the past year. They’re very similar. Warning
statements, ingredients, things that you are prepared or
you’ve doing us correct the past year. Same thing about marketing.
We can’t make health claims. I think if you or our client we told you
make all claims through general thing you don’t want do because we want
F FDA A, but obviously no cartoons. Those requirements as far as still
the inference is now we have a C effective right body and
forcing them and know lots of folks who never saw a PDA agent, the products for tell who they are, send label in the way that slowly
on you need to fix em. You’re not going to have that
opportunity with A, B, C. They’re going to start writing
citations pretty quickly. So you need to be beyond their
game. When it comes to labeling, don’t take it as just
a suggestion. Finally, there’s no self-checkout
or ven machine sales. So there are going to be a number of
changes, but the big ones are structural. You have to sort of pick your lane,
decide and part of this you want to play, we’re going to talk a little bit about
transition but also got to decide if you want to stay in how you want sit,
how you want to stay in the industry, what works for you. And I will tell you today it’s
not so I would’ve said last year, this may not be the industry for you
to stay in because it may be hard. The flip side, which I’ll leave you on
a good note before I hand this over is when this industry really started 20 18, 20 19 and Farmville was
match early players, some of them were the
sprint started to say, look, we can get an industry. They did
well because they were fast movers. They found an opportunity and they
took advantage. With every change, there’s new opportunities. Now they’re
just different, a different set of rules. This industry has exploded. There’s a lot of people who
within been this industry, but if you remember at the end of the day, you’ve got a whole state full of
people who want to buy your products. We know that we’ve had a huge growth and
so they’re still going to want to buy good products and you combine a way to
any product that serves their needs, go to building, there’s still
space to be in this industry. Just going to have to work a little
harder to silence space. So with that, I’m going to hand it over. The ability to talk about really how
do you get ready for the A, B, C era. Department going be by a B
through their exploration bid. That means, but from day one we fully expect
agency to sections audit and enforcement. That will
be a lot more stringent, more specific and probably more
widespread than what we’ve seen far. And flower sales, as we said remain, they go through pre firms
pre-roll for example. We’re still trying to get clarity on
that. If you are filling pre-roll, please keep track of those specifically, but please prepare now for
absolutely every possible licensing, operational change team,
patent fine roll operation, make sure everything is, you’ve
crossed every T dot everything by and you need to be incredibly
compliant. Good to see everybody here, see a lot of faces, good to see you all. Some people I haven’t met I’ve seen
and I appreciate what you’ve done. So let’s move on to what are
we going to do in 2026. So the big deal is are you going
to stay up and up new products, have more looking products to market? Are you going to close shop or
are you going to leave town and follow up in another
state and work that way? So a couple of different
ways you can do it. Probably the best way to do it
is to have all that good data. Alex mentioned people that have
customer data versus folks don’t. If you have customer data then you can
lead with that and possibly be able to shake back. There’s two good options
for that. We can talk about that later. Reach out to us about it. The big one
is being able to track that information. So SOP style, right? So it’s like you need all
of this information so you
need to get it as detailed as possible. So what could you do? We’ve got lots of
cool products that are coming out all the time. I think that’s where the creative
mind really comes out back to 2018 and what we had beverages
were just bang em just to bang really come in the past
seven years and even in the past few years there’s still lots of
really good products for us to make. We’ve just got to come up. So that’s where work with cool people
and come with new brands and you’re going to be able to come with new
products, fill some these holes. Obviously TMCA is the biggest seller.
It’s a lot harder to fill that hole. A couple ideas on that but we’ll talk
more about that. So with the SOP zone, the big thing is having
all that documentation. If you have all the product information,
the batch codes, all that stuff, it’s a lot easier to sleep at night if
you know everything about the products. But if THCA is all that you do, it’s
going to be really tough to switch. So it’s like diversify your
business as quickly as possible. More products and that you might not
even consider cannabis products pure retails. So you’re going to
have more than just cannabis. So just be ready to think outside of THCA. Now we’ve got a couple things
happening right now that are in motion. The state just dropped the public
chapter while we’re sitting here, which is something we’ve been waiting on
for like a month. So once they passed, the bill had to be signed by
the Senate, signed by the house, then it went to the governor in between
all the legal action that was going down in the federal courthouse and it took
longer and then finally the governor signed it last weeks like that.
Anyways, finally got in public chapter, which means today it just got put out, which means we have all of it in one
thing instead of having a big power of amendments helpful, it’s also
one of the things that a, B, C had to wait on before they could do
their rules and regulations. So they couldn’t start on it until they had
that public chapter. They got it today. So they’ll be starting on those rules
and ranks. There’s no timeline for that. Expect them to be quicker and
probably a lot better at it than add. Kelly and I have had a couple meetings
with them and they didn’t say they’re going to be trying to make it as straight
line as possible and like Zach said, they do historically do a good job
of trying to run rules and legs regs to be supportive of the business
as much as possible outside of the law. So we got probably three months, maybe September before we get
rules and regs from a C and then we’re in comment period
and then we have January 1st. So the top line in between now
and then we got six months. But that goes by really quick
when you get this old. So start making those plans now at the same
time we’re going to talk a little bit about opportunity for a lawsuit, but it is something that
if I own a retail store, I would 100% be planning on if I
can’t have these products or my market definitely be planning ahead and that
you’re not going to be two months out from a month out from January to go, okay,
I have to have to make major changes. Go ahead and be planning and then ensure that your TDA license
is updated like they mentioned you’re getting basically get a little six month
raise period and not have to pay that much longer fee to get a license included TCA products, flower concentrate space
all the way up until the end of the year. I’m just trying to keep in mind that hey, what am I ordering and what am I selling?
I don’t be left file in January. And so this fall is the
operational transition period
that I was kind of talking about. It’s when you’re
going to really want to, if there’s not a lawsuit pending
and we’re staring down January 1st, you need to have a plan for your business.
Whether it’s moving out of state, close the doors or just
offering limited products. You need to have that plan set. Otherwise
by the time late fall gets here, you’re really went out of time the
January 4th first. Like I said, the licenses are still good through
ag but because the laws is the law, they get been enforce on January. So even if you haven’t
borrowed a ag license, you are under the jurisdiction
then January 1st of a, B, C. So just understand that there’s a
major difference there between, oh, ags over me, they’ve got my license, I’m good. Ags got your license
that A, B, C is the enforcer. They get to show, not necessarily kicked down the door but
they have it’s well written in law that things get to show up basically.
So Governor Lee did sign it. One of the things we’re trying to do is
do some work around the election cycles for the next year. Try and get some of these
fellows that really screwed over state of Tennessee up their legislature. There’s this thing called legislative
process and they just ignore it. So we want to get people into those
elected positions that are going to do the right job and are going to
respect that legislative process. Are like 12 amendments
additive talking Kelly, I don’t dunno if you’ve ever seen
a bill of that 12 amendments. So that’s how much worth with that support who supported us? So we’ve got good legislators out there.
They’re not all bad. I’ll let you make those
decisions for yourself. But reach out to your local legislators. The easiest way to do that is just throw
in the search bar. Find my legislator. Tennessee’s got a page for that.
Don’t call your federal legislators, they don’t care. Call your
state Local legislators. They’re the ones that will actually, they get voted in on
very small vote accounts. They the ones we can actually make
changes with. So contact contractor, state reps, contractor senators ran pretty hard if they
voted against our bill. If they voted for the Cochran Amendment, tell ’em why they shouldn’t have every
bit of leadership voted can set amendment except for so to say that they’re
all mad is far from the truth because we had people from GOP that did support
us in voting against settlement. So reach out to people
that did vote against it, say thank you and they’re in
their off season. City conductor, consider doing that as
well. And also support TGC. I’ve been working with Kelly since 2018 lobbying work and there’s no one
else up there that does it. No does. There’s just no one else.
When we run the halls there, they know exactly who’s coming when they
see us coming down the halls because they know we’re broken at this point.
What can we do to help you out? Which just that transition, why we’re business get out of state right
now and set up in other states to be able to work back here. My job
is doing compliance audits, looking packaging, looking
at labels, visiting stores, and just really helping out with licensing
and just all the little things come with it. And really the big part
about our compliance program
is getting free time with these guys. So instead of
being a big retainer fee, it’s a monthly fixed cost and just one
hour with these guys generally cover stuff because their time is so, it’s a great program to be a part of.
It’s definitely something that we can help you out with. And you get in trouble.
You don’t have to pay an extra bill. You’re already in the program. If you’re
not in the program, often go other one. We just got ready. Then you’re paying
a return. So if you get in early, then you get all the added benefits.
We have a lab in our office, you can see products and I can test them
for compliance. I can do the inputs, finished products and you’re in the middle
of formulation before you get a large batch. I can test those. So a really, really good program y move out to us
via this QR code. More interested.
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Video Duration: 00:30:55
