TCC Introduces the Cannabis Tree Note™

New opportunities for Thailand’s farmers and global cannabis experts & investors

A Cannabis Tree Note™ (CTN) is a Tree Note™ for Cannabis. [1]

Tree Note™

A Tree Note™ is a security, like a bond.

  • When you buy a bond that “matures” in (for example) ten years, the seller puts the money to work and pays you interest every year for ten years. When, after ten years, the bond matures, the seller repays the money that you paid to buy the bond.
  • When you buy a Tree Note, the seller of the Tree Note puts the money to work by planting a tree and maintaining it as it grows. The seller of the Tree Note pays you interest every year until the tree is cut down (“matures”). Then, the seller repays your purchase price from the proceeds of the tree’s sale.
  • Tree Notes, like bonds, can be registered with the government to ensure that changes in their ownership are tracked reliably.

Bonds are a popular investment because (a) they are safe, in that they return their purchase price at maturity; and (b) they are profitable, in that they pay interest on the purchase price before maturity. The key considerations are the rate of interest (above inflation) that is paid on the purchase price before maturity, and the number of years until maturity. Bonds with shorter maturities are safer, and bonds with higher interest are more profitable, so safer & more-profitable bonds are priced higher than less-safe and less-profitable bonds.

Cannabis Tree Note™ (CTN)

Today, TCC introduces the Cannabis Tree Note™ (CTN).

A CTN matures in one year. TCC puts the CTN’s purchase price to work by planting a medicinal cannabis plant, defined as “a plant of the species Cannabis sativa L. that is particularly high in THC (marijuana), or low in THC (hemp) but high in CBD or some other cannabinoid with medicinal value.”[2] In Thailand’s tropical climate, a medicinal cannabis plant can grow to the size of a tree (a CTN_Tree) within six months, producing a heavy weight of cannabis flower upon harvest. After the first CTN_Tree is harvested, a second CTN_Tree is planted under the same Tree Note. After the second CTN_Tree’s harvest – that is, on the CTN’s maturity – the purchase price of the CTN is repaid to its buyer, with interest. From this, you can see that the CTN has the essential properties of a bond.

The bond-like Tree Note model, as embodied in the CTN, is well-suited to production of highly regulated agricultural commodities such as marijuana.

  • Under the UN Single Convention on Narcotic Drugs, as implemented under Thailand’s national laws, controlled substances (such as marijuana) can only be produced in response to demonstrated demand. This requires that patients first sign up to get medicinal marijuana, and then that medicinal marijuana be produced to meet their needs.
  • TCC has partnered with Thailand’s Veterans’ Association and Thailand’s Handicapped Persons Association to sign up their members as patients of TCC’s medicinal cannabis clinics. TCC has thus legally documented demand, in Thailand, for a great deal of medicinal cannabis.
  • TCC has partnered with many of the Grand Monks of Thailand’s state religion, Buddhism, which provides herbal therapies to millions of Thais through its 6,000+ temples. Under this partnership, TCC has already opened its first clinic at the Wat Kiriwong temple, through which TCC is licensed by all relevant authorities to provide medicinal cannabis to TCC’s registered patients. TCC is rapidly expanding its Thai Traditional Treatments and Therapies Network (4TN) to embrace the thousands of Buddhist temples in Thailand (and beyond).
  • Each CTN is uniquely associated with all necessary government licenses to grow its associated CTN_Trees.
  • The CTN model ensures that TCC can tie each patient to the plant(s) being grown on their behalf, while outsourcing the funding, land ownership, and farming of those patient’s plants.
  • When Thailand enables each Thai household to “grow six cannabis plants,” it is almost certain that growing marijuana plants (that is, cannabis plants with THC higher than a legal threshold) will continue to require security fences, lights, cameras, licenses, etc., such that each family will need to outsource the growing of its plants to licensed, secure growers such as TCC. The CTN model facilitates this, by decoupling the “right to grow six plants” from the farming and financing of those cannabis plants.

The CTN model’s moving parts are as follows:

  • Each CTN_Tree[3] is individually tracked with a unique ID, which is recorded in its CTN.
  • Each CTN represents two unique CTN_Trees, each on a six-month planting-to-harvest schedule, one after the other, over a one-year period.
  • Each set of CTN_Trees is licensed by all relevant authorities, as embodied by a unique CTN_PlantLicense.
  • Each CTN is insured with an insurance policy, a CTN_Policy, that pays off in full if either or both of its CTN_Trees are non-productive for any reason (e.g., destroyed by fire, flood, storm, pest, etc.).
  • Each CannaNotePlant is grown on a farm, a CTN_Farm, that is licensed by all relevant authorities, as embodied in a CTN_FarmLicense.
  • Each farmer who farms CTN_Plants on CTN_Farms has been certified as a CTN_Farmer.
  • The material harvested from the CTN_Plants is processed by licensed CTN_Processors into CTN_Products to be sold through licensed CTN_Distributors and CTN_Retailers.

Here’s how the CTN’s moving parts fit together in TCC’s business model:

  • TCC licenses a portion of its patient list (see “TCC’s Patient List and Clinic Network,” below) to an Agricultural Cooperative or Community Enterprise (ACCE), such that the ACCE will grow medicinal cannabis for specific, named patients.
  • TCC consults with the ACCE on licensing, farm design, financing, etc.
  • TCC supplies the ACCE with “starts” (immature plants, cloned or from seed) whose genetics are suitable for those patients and for the ACCE’s location. The ACCE will grow these starts to maturity.
  • TCC provides the ACCE’s members with training on how to grow the cannabis plants to maturity while meeting TCC’s standards.
  • TCC consults with the ACCE, on an ongoing basis, to ensure that the ACCE’s output is likely to meet TCC’s standards.
  • TCC commits to purchase, from the ACCE, fresh cannabis flower that meets TCC’s standards.
  • TCC arranges, with the ACCE, to harvest, grade, and purchase the ACCE’s cannabis flowers on a specific date.
  • TCC cures the fresh cannabis flowers into cured cannabis bud.
  • TCC outsources the further processing and/or packaging of its cannabis bud into retail-ready medicinal products.
  • TCC sells the resulting medicinal cannabis products to its registered patients through its rapidly-expanding network of licensed clinics.
  • TCC uses the proceeds of these product sales (a) to repay its CTN buyers, with interest, and (b) to accelerate its expansion.

ACCEs: Agricultural Cooperatives and Community Enterprises

Thailand has been organizing its farmers into agricultural cooperatives for more than a century and into community enterprises since 2005. Under Thailand’s current regulations, these Agricultural Cooperatives and Community Enterprises (ACCEs) have been given priority for cannabis-farming licenses. In addition, for the purpose of cannabis farming, low-interest loans are available to ACCEs from Thailand’s Bank for Agriculture and Agricultural Cooperatives. These loans are particularly well-suited to funding the high up-front costs associated with legal cannabis farming, including security fences, video cameras, and other security infrastructure that is legally required for farms that produce controlled substances such as marijuana.

TCC has played a central role in establishing several ACCEs specifically for cannabis farming (see Figure 1, below), but it needs additional ACCE partners to supply its rapidly-growing patient list (see the next topic, “TCC’s Patient List,” below).

Figure 1 (above): TCC’s Co-Founders, Don and Sukanlaya Land, with the leaders of a cannabis-focused Community Enterprise started by TCC, being received by Thailand’s Princess Sirindhorn (a great honor in Thai culture). Sukanlaya Land is in the front row (brown skirt), while Don Land is in the back row (yellow shirt).

TCC’s Patient List

As mentioned above, an ACCE cannot get licensed to grow marijuana until it can demonstrate that specific patients demand its cannabis (rather like California’s original medicinal marijuana program, under 1996’s Prop 215). This is where TCC comes in. TCC has built a large and rapidly-growing patient list through partnerships with the Thai Veterans’ Association (~500,000 members), the Thai Handicapped Person’s Association (~2 million members), and many of Thailand’s Grand Monks of Buddhism (see “TCC’s Clinic Network,” below). You can own thousands of hectares of prime cannabis land, hundreds of hectares of state-of-the-art greenhouses, or vast factories filled with sparkling new extraction equipment, but they will all be worth absolutely nothing until you have a large and rapidly-growing list of patients on whose behalf you are operating your link in Thailand’s cannabis supply chain.

TCC’s Clinic Network

Millions of Thais rely on Thailand’s network of 6,000+ Buddhist temples for both spiritual and physical well-being, through the herbal medicine that Thais are prescribed at Buddhist temples. TCC has formed a partnership with many of the Grand Monks who lead Thailand’s state religion, Buddhism. In February, TCC opened the first of its cannabis-licensed, temple-based Thai Traditional Treatments and Therapies Network (4TN) Clinics at Wat Kiriwong, of whom the Grand Monk and High Teacher is the Venerable Khwanchai Akkachayo, one of Thailand’s most respected experts in traditional herbal medicines (see Figure 2, below).

Figure 2 (above): Mr. Don Land (left) receiving the title Luk Sai (Grand Monk Administrator) from High Teacher Khwanchai Akkachayo at Wat Kiriwong. Luk Sai Don Land is, out of respect for his heritage, wearing the traditional attire of America’s old-school cannabis experts.

Early in March, TCC opened a second temple-based clinic, and TCC expects to open many more, at an exponentially-faster rate, over the course of 2022 and 2023. The rapid expansion of TCC’s temple-based clinic network drives the growth of TCC’s patient list in an exponential feedback loop that ends only when millions of Thais are registered on it.

Hence, TCC owns only the most valuable links in Thailand’s cannabis supply chain: the largest and fastest-growing patient list, and the largest and fastest-growing licensed clinic network. Everything else, it can outsource, thereby creating opportunities for others.

Opportunities for Thailand’s Farmers

If you represent one of Thailand’s 10,000 ACCEs, and your ACCE is committed to increasing its revenues by 25-30% in 2022,[4] then you should contact TCC about becoming one of TCC’s ACCE Partners. Contact TCC today!

Opportunities for Thailand’s Abbots

If you are the Abbot of one of Thailand’s 6,000 Buddhist temples, and you would like to increase the well-being of your community by expanding your medicinal herbs to include high-quality, medicinal-purity cannabis – without suffering any regulatory problems – then you should contact TCC about becoming one of TCC’s Temple Partners. Contact TCC today!

Opportunities for Cannabis Experts

Back in the 1970s, Thailand’s farmers produced the legendary Thai Stick, which consistently had more than 20% THC while being seedless, smooth, and delicious. Back then, a kilo of Thai Stick “easily fetched $4,000 a kilo in any city in the United States” – more than the price of a new car! In the five decades since then, however, the War on Drugs shifted most of Thailand’s cannabis farming out of the fields into hidden greenhouses and warehouses, just as in North America. Today, cannabis can return to Thailand’s open fields, which are (in many places) ideal for high-quality, medicinal-purity cannabis.

If you know how to grow top-quality cannabis flower outdoors, ideally while meeting purity standards such as the World Health Organization’s guidelines on good agricultural and collection practices for medicinal plants (GACP), and you’d like to experience life in Amazing Thailand, then TCC can employ you as a consultant, advising TCC’s network of ACCEs. Contact TCC today!

Opportunities for Investors

Historically, the legal cannabis industry has been funded through equity – the sale of shares. There is a place for this, and TCC welcomes new shareholders. However, TCC also recognizes that equity is a long-term investment, and that cannabis offers short-term opportunities also.

To enable investors to profit from these short-term opportunities, TCC is now offering Cannabis Tree Notes™ through Rewarding Planet Limited (UK). As described above, Cannabis Tree Notes™ (CTNs) are bond-like instruments that, when reaching maturity after a single year, return their purchase price plus interest.

Because CTNs fund the planting of cannabis for which TCC already has committed buyers, and CTNs mature in a single year (repaying their purchase price, plus interest), it is the safest investment in the cannabis industry.

If you’re looking for a low-risk, high-return investment that can help you participate in Thailand’s rapidly-expanding cannabis industry, you owe it to yourself to invest in CTNs. Contact TCC today!

The Big Picture

We have all seen the equity-based “vertically integrated” model of cannabis production destroy billions of dollars in market value in Canada and elsewhere, due to that model’s high start-up costs and grotesque overproduction. TCC is avoiding these mistakes by:

  1. Following international law (which Canada ignored) as implemented in Thailand by first signing up patients, then producing only enough medicinal cannabis to meet their needs. This strategy may cause TCC to expand more slowly than it otherwise could, but it because its sell-through is ensured, TCC’s model can be expected to be safer and more profitable for its investors and other stakeholders. Furthermore, TCC’s focus on developing Thailand’s domestic market is entirely appropriate, given Thailand’s large population (70 million), cultural acceptance of medicinal cannabis, and the trivial size of the current global cannabis export market.
  2. Decoupling the short-term financing of TCC’s crops (through CTNs) from:
    • The long-term financing of TCC’s retail, distribution, and market-orchestration operations (financed through sale of equity in TCC);
    • The construction of expensive cannabis-farming infrastructure such as security fences, water supplies, greenhouses, etc (financed by low-interest bank loans to ACCEs); and
    • The ownership of land (supplied by ACCEs).

Ensuring sell-through and decoupling the financing of the different components of TCC’s business model have the effect of reducing the risk of investing in each component.

Managing this risk is important, because medicinal cannabis will inevitably be commoditized, such that only the lowest-cost producers (at each level of quality) will survive. The recent commoditization of a similarly-regulated agricultural product, the poppy straw from which legal opiates are derived, has caused poppy straw growers and processors to feel “the pressure to downsize operations or to consider exiting the industry,” according to Deloitte. TCC’s model enables investors to maximize their returns and to minimize their risks in both the short and long runs by investing in CTNs (for the short run) and TCC’s shares (for the long run), while having Thailand’s banks bear the risk of funding cannabis-farming’s expensive infrastructure.

The links in the value chain that TCC owns – the patient list and the clinics – are the most customer-facing. Owning these links enables TCC to own the industry’s consumer relationships, to brand TCC’s products, and to gather rich databases on patients and products. TCC owns only those links from which the most value can be created and captured, while enabling TCC to orchestrate the other links.

Thus, TCC chieves an “asset-light,” future-proof business model its TCC’s equity investors, for TCC’s stakeholders, and for investors in TCC’s CTNs.

Show Me the Numbers

Table 1 (below) shows how money moves through TCC’s CTN model. The table assumes that each of a CTN’s two CTN_Trees, harvested once after six months of growing under the tropical sun, will produce 2kgs of fresh flower per harvest, which is 4kgs total across the two CTN_Trees. The model is profitable even if the two CTN_Trees, together, produce a mere 1.5 kgs – which, for a typical six-month tropical monster tree, would be pathetic indeed. TCC is confident that, with TCC’s help, its ACCEs’ farmers can produce quality bud in the 4-6kg per Tree Note range (that is, 2-3 kgs per CTN_Tree).

TCC is similarly confident that it can get a wholesale price of ฿100,000 ($3,000) per kilogram of cured bud, as described in the model below, because TCC controls its own distribution to its own retail clinics, to which TCC has already signed up a large and growing patient list. This wholesale price implies (at a standard 2x markup from wholesale to retail) a retail price of $6,000/kg, which is less than half of today’s street price of ($14,000/kg). Prices will, of course, fall rapidly over the coming years. TCC’s asset-light model and focus on the customer-facing links in the supply chain is expected to enable TCC to remain profitable as prices decline.

Table 1: Money flow through TCC’s Cannabis Tree Note model.

[1] Tree Note™ and Cannabis Tree Note™ are trademarks of Rewarding Planet Securities Ltd (UK) under the international Madrid System.

[2] In February 2022, Thailand removed, from its list of controlled substances, cannabis that has a THC percentage of less than 0.2% — that is, hemp. Marijuana, which by Thailand’s definition has a THC percentage greater than or equal to 0.2%, remains a controlled substance under Thai law. Any “hemp” grown in Thailand’s tropical climate is very likely to contain more than 0.2% THC, making it marijuana under Thai law. For these practical reasons, TCC’s focus is on marijuana for medicinal use.

[3] Why use the “CTN_” prefix in these terms, such as “CTN_PlantLicense,” rather than tying the term to a specific jurisdiction, as in “ThaiPlantLicense”? Because the CTN model is being implemented across SE Asia, including Thailand, Laos, Cambodia, and beyond. The CTN model and the names of its terms have been chosen to be consistent across these different jurisdictions.

[4] According to K. Somkiat Kimawaha, Senior Executive Vice-President of the Bank for Agriculture and Agricultural Cooperatives, planting cannabis “is expected to add 25-35% more revenue to farmers’ existing tally from traditional crops.”