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HomeMy WebLinkAboutVert Application For City Staff Use Only CITY OF ^111�r .I r t�arilunl - PLANNING DIV[SION CBP#(s): CANNABIS BUSINESS On November 14, 2017, the City of Lake Elsinore City Council adopted an ordinance that conditionally permits can- nabis related land uses in both the M-1 and M-2 zone districts, subject to the approval of a Conditional Use Permit. The ordinance establishes a specific cannabis business permit and three conditionally permitted cannabis related land uses, subject to the approval of a Conditional Use Permit; these uses include cultivation, manufacturing and testing. Two additional cannabis related land uses were established that must be collocated with a conditionally permitted land use,these uses include dispensaries and distribution facilities. PROPERTY INF • • Address: APN(s): 31881 Corydon St,Ste 160&31875 Corydon St,Ste 120 Lake Elsinore,CA 92530 370-051-031 General Plan Designation: Zoning Designation: 370-051-008 East Lake District M-1 Current Use/Description of the property: Both proposed units are currently vacant. Both units reside within the Blue Lake Industrial Condo Association i among various light industrial uses. 31875:UNIT E2 CM 148/177 Unit E2 LotType Unit RecMapType Condominium Map MapPlatB 148 MapPlatP 177 31881:UNIT H6 CM 148/177 Unit H6 LotType Unit RecMapType Condominium Map MapPlatB 148 MapPlatP 177 SUBMITTAL REQUIREMENTS Comprehensive Project Description (See attached required information) Property Owner signed affidavit specifying permitted cannabis related landuse. Required Conditional Use Permit information (Refer to the Planning Application form) PROJECT DESCRIPTION Vert Lake Elsinore proposes to open and operate a cannabis manufacturing facility with ancillary uses including a segment dedicated to distribution and a retail facility. These proposed uses were developed and designed to be in full compliance with both local and state regulations. Vert Lake Elsinore,LLC intends to operate as Cannabis Kingdom.A strong emphasis has been put on protecting the community,creating quality job opportunities,and enhancing the quality of life of our neighbors. As such,Cannabis Kingdom will provide for enhanced wages for our employees, trained on-site security guards and on-call security response,top-of-the-line security system,and a commitment to ongoing employee training to ensure compliance with all local and state regulations. ON Property w r- Applicant Name: The Frederick Thomas Scalzo Separate Name: Vert Lake Elsinore,LLC Property Trust,dated February 27,2018 Mailing Address: PO Box 1660 Mailing Address: 416 South Magnolia Ave City/State/Zip Code: San Juan Capistrano,CA 92693 City/State/Zip Code: El Cajon,CA 92020 Phone: Phone: 619-200-9549 Email: Email: saif.alchi@alchienterprises.com Architect Engineer Name: Rob Mothershed Name: GMEP Engineers Mailing Address: 651 Clover St#1 Mailing Address: 26439 Rancho Pkwy S.Suite#120 City/State/Zip Code: Los Angeles,CA 90031 City/State/Zip Code: Lake Forest,CA 92630 Phone: 310-972-0973 Phone: 949-267-9095 Email: rob@robmothershed.net Email: info@gmepe.com *For additional property owners,attach a separate page with APN(s),address,contact information,and signatures. I hereby certify that I am the applicant or designated agent named herein and that I am familiar with the rules and regulations with respect to preparing and filing this petition for discretionary action, and that the statements and answers contained herein and the information attached are in all respects true and accurate to the best of my knowledge and belief.Please note all correspondence will be directed to the designated applicant. The property owner further certifies that they are the legal owner of the property,consent to the filing of this appli- cation, and have authorized the applicant below to represent them with respect to the processing of this applica- tion. Finally, I understand that incomplete applications cannot be transmitted or processed.To process a case in an expe- ditious manner,a complete application package Is necessary. Property Owner(s) Name(Print): Si ure: Dat Donna M.Ostermiller Name(Print): �hyn ature: D!5: Timothy J.Scalzo,Successor Trustee 1 Applicant Name(Print): Signature: Da e. Saif Alchi,Managing Member 3 0 Please check this box if you are willing to receive staff reports via emoils r - ---C-AUFORNA n L L oU IPOSE-AC-KNOWL-E IDN"T A notary public or other officer completing this certificate verifies only the identity of the individual(s)who signed the apd not the truthfulness accuracy,or validity of that document. STATE OF CALIFORNIA ) ss COUNTY OF ORANGE ) On 3 �O 4( c*)oCE�Z before me, HEMANSHU P. BADANI, Notary Public, personally appeared �£ar—tr!A QS7EtRMILL6P, �� l i�'lv i ttY � Sc FlLzza who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) 44/are subscribed to the within instrument and acknowledged to me that lle/she/they executed the same in-hi6fFier/their authorized capacity(ies), and that by.his /their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. HEMANSHU P.BADANI ---------- c� ,Q � COMM...2267720 m "� NOTARY PUBLIC•CA`IFORNIA 1 Signature m eal�ORANGECOUNTY W My)Term Exp.Oct.7,2022 Though this section is optional, completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. Description of Attached Do ument Title or Type of Document ( �t--)� lik"• Document Date -3 Number of Pages ) SignerdOther Than Named Above: PROPERTY OWNER CONSENT FORM Commercial Cannabis Business PROPERTY OWNER INFORMATION Timothy J.Scalzo ❑ Owner ❑ Manager IN Other: Successor Trustee Name Title The Frederick Thomas Scalzo Separate Property Trust, dated February 27, 2018 Business Name(if applicable) Phone Number PO Box 1660 San Juan Capistrano CA 92693 Mailing Address city State Zip Code PREMISES INFORMATION 31875 Corydon St,Ste 120/31881 Corydon St,Ste 160 Lake Elsinore CA 92560 Physical Address city State Zip Code Vert Lake Elsinore, LLC Tenant Applicant(Business Name) ® Optional - Copy of the property lease agreement attached DECLARATIONS AND SIGNATURE I hereby certify that I am the property owner and/or manager of the premises referenced in the Premises Information section, and authorized to complete this form on the property owner's behalf.The property owner acknowledges that the above-mentioned tenant has the legal right to occupy the property and acknowledges and consents to the conduct of commercial cannabis manufacturing activities on the property. o�D igna4tvvlx _ Dat CALIFORNIA NOTARY ACK. /JURAT ATTACHED _ ° 3 /-04 /202Z vrrs rorrvrr.w irzz�...vscxyriya�errsasrrrwiiriaRar+as,<c�a�v.✓.+�r�+�rssar�B.,r-ter.©'ass'ri.�riB.rwr�aBrBwore+r'i.'B.(suv'.suviBt�^ CALIFORNIA JURAT otary public or other officer completing this certificate verifies only the identity of the individual(s)who signed the document to which this certificate is attached,and not the truthfulness,accuracy,or validity of that document. r STATE OF CALIFORNIA ) )ss COUNTY OF ORANGE ) Subscribed and sworn to(or affirmed) before me on this _ play of ,Aoyu , 20J b i tt �• Sc- r_�c7 f Y "�T T v who proved to me on the basis of satisfactory evidence to be the person( who appeared before me. HEMANSHU P. BADANim a ----- fm- Qom . COMM...2257720 0 U r NOTARY PUBLIC-CALIFOFiNIA ORNGEOUNTY Signature m MyToAExp.0 W rm r it d m.Szer�.aares�rw�wwr�'B�w�tOsi.►:�r'+av%y�+ OPTIONAL '���B.;a+eay asa:v�>,B.inr'd�owsswra�:z wo�srardw Though this section is optional,completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. e Description of Attached Document r v Title or Type of Document P�• C •L '"�Document Date 3�4I cNumber of Pages Signers Other Than Named Above: P r.'.�Y,s'.r B.r�iiB.�r�M�II/B/atria.�/.ti'ae�walorB..waI�1YId,/Mirur�rrtl�.�piBiwlc:Y..Ar',u�:�IRJ.aYY�1D/r.I11YRIf+Y:rB .RB'RIMI'l.9IlB.�Ki1RL"/. L'- Bararf/D' I.rr�lf//B.�i^B O/ BOwB+B� Cannabis Business License Piulect Description Please prepare a comprehensive project description, which includes a minimum of the following information and shall be structured as detailed below: A. Executive Summary • Concise summary of the project description B. Project Proponents • Legal Name of Applicant (Entity), this will be used for all permitting related activities. • Is the proposed cannabis operation a sole proprietorship, General Partnership, Limited partnership, and Type C or S Corporation? Please attach any articles of incorporation or other legal establishment of the applicant entity as an attachment. • List all Persons/Entities Owning 5% or more of Applicant Entity • Please Disclose All Convictions, Infractions and Other Applicable Items Relative to Law Enforcement for ALL Persons Owning ANY portion of a Facility (Retail or Cultivation) • Description of Experience in the Cultivation of Cannabis (Name of Entity, Place of Entity, Describe Specific Experience)' B. Project Location • Proposed Business Location (Address and Assessor's Parcel Number) • Documentation (Letter of Intent, Purchase and Sale Agreement, Lease Document or Similar) for Proposed Business Location (Price for Sale or Lease may be Redacted) • Is the subject property located within a business park property owner association? If yes, are potential uses subject to approval from the association? Please provide documentation in the form of an attachment of the association approval if applicable. • Description of surrounding land uses. C. Operational Characteristics • Summary of the operational characteristics • Will the proposed Cannabis business be recreational or medical in nature? If the proposed business is to be medical in nature, please provide documentation that applicant has filed or is currently registered with the State of California as a cooperative or collective pursuant to Corporations Code §12201 or Corporations Code §12300. • Proposed Size of Building (total): • Proposed Uses of Building and Square footage: o Office/Administrative o Cultivation ' A person may not be denied the ability to obtain a permit or operate a distribution facility solely on the basis that the person has been convicted of a felony if the person has obtained a certificate of rehabilitation (expungement of felony record) under California law or similar federal statute or state law under which the expungement was granted o Laboratory/Testing o Dispensary o Kitchen/Food Product Manufacturing o Other(Please Describe) • Estimate range of quantity to be produced annually (Stabilized). • Estimated value of product. • Estimate range of quantity to be sold via retail on-site (if applicable)? • List Any Local/County/State or Federal Permits in Your Possession (including Will-Serve Letters) • Projected Total Employees and Listing of Type (by Title or Job Assignment), show if they are Part-Time or Full-Time and estimated salary range. • Projected Total Payroll (Annual). • How will Payroll be Processed (through a bank, credit union, third party payroll company or by cash) • How will Payroll Taxes be withheld? • How will Sales be Accounted For (Software System, Point of Sale or otherwise)? • How will Project Transportation/Distribution Security be Addressed? • Will you or persons you employ be seeking concealed weapons permit or similar? • Describe ALL chemicals and fertilizers to be used on site and their toxicity? How will said be disposed of after use (including within water/sewer system)? D. Security Plan (Security Plans shall be submitted as a separate document and incorporated as an attachment to the project description). Each cannabis business site shall have security plan approved by the Sheriff's Department. The security plan shall be a narrative and also an include a detailed security plan delineating the physical location of the specific equipment. The proposed security plan must include the following at a minimum: • Summary of the security plan, this shall be included in the project description, all other elements shall be incorporated as a separate attachment, entitled security plan, to the project description. • Security surveillance cameras. Security surveillance cameras and a video recording system must be installed to monitor all doors into the buildings on the site, the parking lot, loading areas, and all exterior sides of the property adjacent to the public rights of way. The cameras and recording system must be of adequate quality, color rendition, and resolution to allow the identification of any individual present on the site. The recording system must be capable of exporting the recorded video in standard MPEG formats to another common medium, such as a DVD or USB drive. • Security video recording and retention. Video from the security surveillance cameras must be recording at all times (24 hours a day, seven days a week) and the recording shall be maintained for at least 30 days. The video recordings shall be made available to the City upon request. • Location of security cameras and the areas to be covered by the security cameras. • Location of audible interior and exterior alarms. • Location of exterior lighting. • Name and contact information of Security Company • Whether entrances to all dispensingand cultivation oc of staff at all times. • Name of security guard and proof that security guard is licensed by the California Department of Consumer Affairs and whether security guard will be present at the medical marijuana facility during all hours of operation. If the security guard is to be armed, proof that security guard possesses a valid Security Guard Card and Firearms Permit issued by the California Department of Consumer Affairs. Alarm system. Professionally and centrally-monitored fire, robbery, and burglar alarm systems must be installed and maintained in good working condition. The alarm system must include a private security company that is required to respond to every alarm. F. Fire Protection Plan. (Security Plans shall be submitted as a separate document and incorporated as an attachment to the project description). Each cannabis business site shall have fire protection plan approved by the Fire Marshal. The fire protection plan shall be a narrative and also include a detailed fire protection plan delineating the physical location of the specific equipment. The proposed fire protection plan must include the following at a minimum: • Summary of the fire protection plan, this shall be included in the project description, all other elements shall be incorporated as a separate attachment, entitled security plan, to the project description. • Occupancy Classification. The Use and Occupancy Classification of Marijuana Business. Please identify the proposed use and occupancy classification of the proposed use. Use and occupancy classifications may be found in Chapter 3 of the International Building Code (IBC), and International Fire Code (IFC). • Hazard Communication. When storing or using any type of hazardous materials, IFC Section 407 should be followed and the appropriate paperwork made accessible to the fire code official. Additionally, IFC Sections: 5001.3 - 5001.6.3 should be consulted. Section 407 of the IFC gives responders the information of the hazardous chemicals that is on the property. o Material Safety Data Sheets (MSDS) shall be on property and made easily accessible. o Containers and/or packages related to hazardous materials shall be properly labeled and warning signage shall be properly displayed and easily visible. o All persons shall be trained on what to do in the event of an emergency involving hazardous material on the property. Fire protection plans shall refer to the location of all hazard communication information. • Interior Finishes. It is common in marijuana grow facilities to use a Visqueen® or Mylar® type plastic/polyethylene or polyester sheeting to cover walls and ceilings. Any use of plastic to enclose rooms or cover walls and/or ceilings must be installed in accordance with building and fire code requirements. Interior finishes must comply with flame spread ratings in accordance with Table 803.3 of the IFC. (Note: Hanging plastic from ceilings or suspended overhead structures to create wall dividers is typically NOT compliant with code provisions for a wall partition or interior finish.) • facilities. The desire for security in no way overrides the minimum requirements for exiting and egress. Common issues associated with exits and egresses are as follows: Number of exits shall be in accordance with Table 1006.2.1 and Table 1006.3.2(2) and Section 1017.2 of the IFC. Fire protection plan shall identify o Means of egress cannot be concealed in any way. o Exit doors and their function (these cannot be eliminated without prior approval). o Where 2 or more exits are required, egress doors are required to swing in the direction of egress travel. o Where more than one exit is required, illuminated exit signs are to be provided that must be readily visible from any direction of egress travel. o Intermediary exit signs may also be required per Section 1013 of the IFC. o H occupancies require specific considerations for exiting. • Locks and Key Box Where security and life safety objectives conflict, alternative measures may be required or permitted by the City. SECURITY GATES — Due to the increased security measures typically required, and the potential hazards associated with marijuana facilities, the City is authorized to require that any security gate be installed across a fire apparatus road first be approved before installation. o KEY BOXES — Installation of a key box in an approved location, which will permit timely access to the facility in the event of an emergency shall be identified. o LOCKS — The installation of "approved" locks on any and all gates or similar barriers, which will permit timely access to all areas of the facility's property in the event of an emergency. If the facility has electronic access controls, the City will require an access code or electronic access card be provided. o BOLTS, BARS, LOCKS & LATCHES — Egress doors are required to open easily when exiting without the need for a key, without using extra effort and/or without having special knowledge in order to operate the installed hardware. Door handles, pulls, latches, locks and other operating devices should be free of tight grasping, tight pinching or twisting of the wrist to operate. Slide bolts, security bars, dead bolts, thumb latches and similar hardware items are prohibited from being installed on emergency egress doors. o ALTERNATIVE LOCKING DEVICES - Delayed egress locks and electromagnetic locks are permitted for use in other occupancy types, and must be approved for use by the City. • Fire suppression systems. Fire protection plan shall include all suppression systems designed to meet the specific E. Closure Plan • Summary of the remediation plan. This shall be included in the project description, all other elements shall be incorporated as a separate attachment, entitled security plan, to the project description. • Remediation Plan. Describe how Cultivation/Retail Facility will be remediated at end of use? (Process of Removing Equipment, Chemicals, and other items/remnants). Llude the expenses fo,-ceasing operation ofthe cannabis facility and safely closing the unit and cleaning up any contamination. Post- closure care costs include long-term maintenance of the unit or facility, monitoring, and record keeping during the required post-closure care period. Owner/operators calculate cost estimates based on the cost of paying a-thiRl party to perform the require closure and post-closure care activities as outlined in the facility's remdiation plan. Cost estimates must be adjusted annually throughout the operational life of the facility to account for inflation. • Surety Bond. A surety bond from a surety company shall be submitted and maintained through out the life of the cannabis business permit that all closure and post-closure care requirements will be fulfilled. If the owner/operator fails to meet the requirements specified in the bond, the surety company is liable for the costs. For City Staff Use Only CITY OF Hate 5ti�irtitled — C� PLANNING DIVISION Project#(s): PLANNING APPLICATION The Planning Application review process applies to all projects requiring a discretionary action. Discretionary refers to projects that involve a level of judgment and discretion by the decision-maker in taking action to approve, ap- prove with conditions or deny a project,with findings. Depending on the level of review,a decision-maker on a dis- cretionary project is the Director of Community Development, Planning Commission or City Council. Typical types of projects that require a discretionary action include;Conditional Use Permits, Design Review,General Plan Amend- ments,Tentative Parcel or Tract Maps,Variances,and Zone Change. PROPERTY INF • • Address: APN(s): 31881 Corydon St,Ste 160&31875 Corydon St,Ste 120 Lake Elsinore,CA 92530 370 051 008-0 General Plan Designation: Zoning Designation: 370-051-031 East Lake District M-1 Current Use/Description of the property: Both proposed units are currently vacant. Both units reside within the Blue Lake Industrial Condo Association among various light industrial uses. 31875:UNIT E2 CM 148/177 Unit E2 LotType Unit RecMapType Condominium Map MapPlat6 148 MapPlatP 177 31881:UNIT H6 CM 148/177 Unit H6 LotType Unit RecMapType Condominium Map MapPlat6 148 MapPlatP 177 PROJECT INFORMATION ❑Annexation ❑ Substantial Conformance ®Conditional Use Permit ❑Specific Plan ❑ Design Review(Specify Type: ) ❑Sign Program ❑ Extension of Time ❑Surface Mining and Reclamation Plan ❑ General Plan Amendment ❑Tentative Parcel Map ❑ Public Convenience or Necessity ❑Tentative Tract Map ❑ Planned Unit Development ❑Variance ❑ Pre-Application Consultation ❑Zone Change Project Description Cannabis Micro Business (Manufacturing/Distribution/ Retail) ..+-pow CONTACT INFORMATION Property Owner" Applicant Name: The Frederick Thomas Scalzo Separate Name: Vert Lake Elsinore,LLC Property Trust,dated February 27,2018 Mailing Address: PO Box 1660 Mailing Address: 416 South Magnolia Ave City/State/Zip Code: San Juan Capistrano,CA 92693 City/State/Zip Code: El Cajon,CA 92020 Phone: Phone: 619-200-9549 Email: Email: salf.alchi@alchienterprises.com Architect Engineer Name: Rob Mothershed Name: GMEP Engineers Mailing Address: 651 Clover St#1 Mailing Address: 26439 Rancho Pkwy S.Suite#120 City/State/Zip Code: Los Angeles,CA 90031 City/State/Zip Code: Lake Forest,CA 92630 Phone: 310-972-0973 Phone: 949-267-9095 Email: rob@robmothershed.net Email: info@gmepe.com "For additional property owners,attach a separate page with APN(s),address,contact information,and signatures. PROPERTY OWNER/APPLICANT SIGNATURE I hereby certify that I am the applicant or designated agent named herein and that I am familiar with the rules and regulations with respect to preparing and filing this petition for discretionary action, and that the statements and answers contained herein and the information attached are in all respects true and accurate to the best of my knowledge and belief.Please note all correspondence will be directed to the designated applicant. The property owner further certifies that they are the legal owner of the property,consent to the filing of this appli- cation, and have authorized the applicant below to represent them with respect to the processing of this applica- tion. Finally, I understand that incomplete applications cannot be transmitted or processed.To process a case in an expe- ditious manner,a complete application package is necessary. Property Owner(s) Name(Print): Si tire: Dat Donna M.Ostermiller Name(Print): i nature: D : Timothy J.Scalzo,Successor Trustee Applicant Name(Print): Signature: Dat Saif Alchi,Managing Member i.. Z/ -; ❑Please check this box if you are willing to receive staff repo via Aails I-UKNIA Al PURPO A notary public or other officer completing this certificate verifies only the identity of the individual(s)who signed the document to which this certificate is attached, and not the truthfulness,accuracy,or validity of that document. STATE OF CALIFORNIA ) ) ss COUNTY OF ORANGE ) On 03 (C5�( ':Zo&Z before me, HEMANSHU P. BADANI, Notary Public, personally appeareA�UNNA 1`1 i�STEMILIE� I IMF J ' S�AL�a who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) 4&/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in4gs/*er/their authorized capacity(ies), and that byj4sAwlr/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph,is true and correct. WITNESS my hand and official seal. —� • . HEMANSHU P.BADANIm COMM...2257720 NOTARY PUBLIC-CALIFORNIA -i ~�—�� 10 f'O eoIZANGECOUNTY W Signature , ' y erm Exp.Oct,7,202 Though this section is optional, completing thls information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. Description of Attached Do ument -- Title or Type of Document G- f`-�,�_� Document Date 3 I7 Number of Pages Signer Other Than Named Above: CITY OF LAKE ir�-�)Lsl NO E CITY OF LAKE ELSINORE PLANNING DIvIsION AGREEMENT FOR COST RECOVERY Project Name: Cannabis Kingdom Planning Application Number(s): CRS Number(s): The application(s) for the above referenced project may generate processing costs in excess of the amount of the filing fee. If applicable, your initial deposit amount of $ will be applied toward your application.Draws against this deposit will be made based on staff time and materials needed to process your application. Statements will be sent to you documenting the draws against your deposit. If the deposit reaches a balance of $500.00 or less, you will be asked to make a subsequent deposit. You will be expected to pay these bills within 30 days of invoice date. The remaining $500.00 or less will be used to reconcile your final bill. If there is a balance remaining after reconciling the final bill,a refund check will be mailed to you. Saif Alchi I * (as responsible party), agree that actual recorded costs plus overhead, incurred in the processing of this application(s) will be paid to City of Lake Elsinore,c/o Lake Elsinore Planning Department, 130 S. Main Street, Lake Elsinore,CA 92530.Additionally, I understand that, in the event that my account is not paid within 30 days of the invoice date, processing will be suspended until such time that payment is made. In order to implement the cost recovery provisions, please sign this statement indicating your agreement to the cost recovery procedure. The signed agreement is required for your application to be accepted for processing. XZ Responsible Party's Signature: — r r Date: g 12 CITY OF .� ENVIRONMENTAL ��PLANNING DIVISION INFORMATION FORM Date Filed: Planning Application No. GENERAL INFORMATION Vert Lake Elsinore, LLC Developer or Applicant Contact Person Saif Alchi 416 South Magnolia Ave Address El Cajon, CA 92020 Telephone 619-200-9549 Email 31881 Corydon St,Ste 160&31875 Corydon St, Ste 120 Address of Project: Lake Elsinore, CA 92530 Cannabis Micro Business(Manufacturing/Distribution/Retail) Proposed Use of Site: 370-051-008 Assessors Parcel Numbers: 370-051-031 For Residential Development Number of Units Unit Sizes Units per Acre Lot Sizes: Number of Parking Spaces For Commercial and Other Development Type of Development: Tenant Improvements Number of Buildings: 2 Size of Buildings: 5,602sf and 2,497sf Number of Parking Spaces: Shared within the Blue Lake Condo Association-Exceeds City requirements ENVIRONMENTAL INFORMATION PLEASE PROVIDE A SEPARATE WRITTEN RESPONSE FOR QUESTIONS#1-4, IT IS RECOMMENDED THAT PHOTOGRAPHS BE PROVIDED IN SUPPORT OF SUBMITTED ANSWERS. 1. Describe the project site and any existing structures as they exists before the project, including information on topography,soil stability,plants and animals,and any cultural or scenic aspects. 2. Describe the surrounding properties,including information on plants and animals and any cultural, historical or scenic aspects. 3. Describe the typed of surrounding land use,intensity of land use,and sale of development. 4. Identify any other related permits and other public approvals required for this project including those required by the City,regional,State,Federal agencies, not including approvals from the City, fire department,sheriff's department,and Elsinore Valley Municipal Water District. Is any part of the Project,on-or off-site,located within a Criteria Cell pursuant to the Multiple Species Habitat Conservation Plan (MSHCP)?If so,what are the Criteria Cell#(s)? If not known, please enter all APNs at the following website to run a report,and include the report with submittal of this form:http://www,rctima.org/online/content/rcip report aenerator.aspx The City is a Lead Agency under CEQA,and is required under State law to ensure compliance.All projects are subject to a review under the California Environmental Quality Act(CEQA)and will consist of one(1) or more of the following: • If not exempt,preparation of technical studies will be required to support determination of appropriate CEQA process,as described below. • Determination by Planning Division that all project impacts are less than significant,or can be mitigated to less than significant. As such,the City will direct preparation of a Negative Declaration(ND)or Mitigated Negative Declaration (MIND). • Determination by Planning Division that at least one(1)project impact cannot be mitigated to less than significant levels. As such,the City will direct preparation of an Environmental Impact Report(EIR). All CEQA documents must be prepared either by City Staff OR by a qualified, City-approved consultant under direct contract with the City,but funded by the Applicant. Depending on the environmental impacts potentially resulting from your project,technical studies that may be required,but are not be limited,include: • Air Quality Analysis • Noise Study • Traffic Impact Analysis • Geotechnical Study • Phase I Environmental Site Assessment(Hazardous Materials) • Hydrology Study or Conceptual Drainage Plan • Conceptual Water Quality Management Plan • Biological Resources Study(also used to support MSHCP consistency work) • Cultural Resources Study CERTIFICATION I hereby certify that the statements furnished above and in the attached exhibits present the data and information required for this initial evaluation to the best of my ability,and that the facts,statements, and information pre ented are true and correct to the best of my knowledge. SIGNATURE: DATE: 2 CITY OF " LADE LSIN0RE 'jC_2 HAZARDOLIS WASIE SITE JPLANNINc, DIVISION & PUBLIC WELL SITE INFORMATION Government Code Section 65962.5,which became effective July 1, 1987,requires the applicant for any development project to consult specified state-prepared lists of hazardous waste sites and submit a signed statement to the local agency indicating whether the project is locat6d_on or near an Identified site.Under the statute,no application shall be accepted without the signed statement. PART A To determine if your project is on or near an identified Hazardous Waste Site please refer to any State identified Hazardous Waste Sites as listed by the County of Riverside Department of Environmental Health. Is the project located on or near a State identified Hazardous Waste Site? Yes❑ No 0 (If you answered yes to the above question, please fill out the information below. If you answered no, please sign and date the certification below). Name of Applicant: Address El Cajon,CA 92020 Phone Number Address of Site Local Agency(City/County) APN(s) Specify any list pursuant to Section 65962.5 of the Government Code Regulatory ID Number Date of List PART B To determine if your project is within one(1)mile radius of a public well site,which could potentially be affected by a hazardous waste generator,please refer to the State identified Public Well Sites. Is your project within a one-mile radius of an identified public well? Yes❑ No If yes, please identify: CERTIFICATION I hereby certify that the statements furnished above and in the attached exhibits present the data and information required for this initial evaluation to the best of my ability, and that the facts, statements,and information presented are true and correct to the best of my knowledge. SIGNATURE: DATE: '1 'I✓� Please prepare a comprehensive project description, wfiicb—Mfwdos a r!—iffM"i►�0Ttt5-e-falt0Vt information and shall be structured as detailed below: A. Executive Summary • Concise summary of the project description See Business Plan B. Project Proponents . Legal Name of Applicant (Entity), this will be used for all permitting related activities. Vert Lake Elsinore, LLC • Is the proposed cannabis operation a sole proprietorship, General Partnership, Limited partnership, and Type C or S Corporation? Please attach any articles of incorporation or other legal establishment of the applicant entity as an attachment. Limited Liability Company • List all Persons/Entities Owning 5% or more of Applicant Entity Saif Alchi(90916) Vert Holdings, Inc (10946) • Please Disclose All Convictions, Infractions and Other Applicable Items Relative to Law Enforcement for ALL Persons Owning ANY portion of a Facility(Retail or Cultivation) None • Description of Experience in the Cultivation of Cannabis (Name of Entity, Place of Entity, Describe Specific Experience) N/A Project Location • Proposed Business Location (Address and Assessor's Parcel Number) 31875 Corydon St., Unit 120 & 31881 Corydon St., Unit 160 Lake Elsinore, CA 92530 • Documentation (Letter of Intent, Purchase and Sale Agreement, Lease Document or Similar) for Proposed Business Location (Price for Sale or Lease may be Redacted) See Lease • Is the subject property located within a business park property owner association? If yes, are potential es subject o appro�lva--fair th adocumntatloMri the form of an attachment of the association approval if applicable. See Blue Lake Industrial Condo Owners Association Letter • Description of surrounding land uses. The surrounding land uses consist of light manufacturing, vacant land, and the Skylark Field Airport. No sensitive uses or residential properties are located within 1000'or the proposed project locations. C. Operational Characteristics • Summary of the operational characteristics Vert Lake Elsinore proposes to open and operate a cannabis manufacturing facility with ancillary uses including a segment dedicated to distribution and a retail facility. These proposed uses were developed and designed to be in full compliance with both local and state regulations. Vert Lake Elsinore, LLC intends to operate as Cannabis Kingdom. A strong emphasis has been put on protecting the community, creating quality job opportunities, and enhancing the quality of life of our neighbors. As such, Cannabis Kingdom will provide for enhanced wages for our employees, trained on-site security guards and on-call security response, top-of-the-line security system, and a commitment to ongoing employee training to ensure compliance with all local and state regulations. • Will the proposed Cannabis business be recreational or medical in nature? If the proposed business is to be medical in nature, please provide documentation that applicant has filed or is currently registered with the State of California as a cooperative or collective pursuant to Corporations Code §12201 or Corporations Code §12300. Operations will be compliant and consistent will applicable Bureau of Cannabis Control Regulations for Adult Use and Medical Cannabis sales. • Proposed Size of Building (total)- Total Square footage of both buildings: 8099sf Percentage of overall space for retail: 19 • Proposed Uses of Building and Square footage: o Office/Administrative: 541 sf o Shipping/Receiving: 328sf o Dispensary: 1,506sf o Other(Please Describe) o Manufacturing Rooms: 1,793sf o Distribution: 570sf o Electrical/Storage Closets/Hallways/Restrooms/Entry Room: 3,066sf o — ■ Retail: 63sf • Manufacturing: 134sf ■ Distribution: 98sf • Estimate range of quantity to be produced annually (Stabilized). Pre-rolls: 20,876 Cartridges: 62,641 Wax: 18,792 Edibles: 46,060 • Estimated value of product. $6,210,570 • Estimate range of quantity to be sold via retail on-site (if applicable)? $2,662,775.86 • List Any Local/County/State or Federal Permits in Your Possession (including Will-Serve Letters) Will Serve Letter from SoCal Edison • Projected Total Employees and Listing of Type (by Title or Job Assignment), show if they are Part-Time or Full-Time and estimated salary range. Assistant General Manager(1) Daily Operations,Management&Execution S 41,600.00 Head of Security(1) Daily On Site Security Management Contract Administrative Assistant/Bookkeeper(1) Office Manager,Record Keeping $ 35,360.00 Quality Controls Specialist(1) Inventory/Product Intake&Fulfillment(Delivery&Online Orders $ 31,200.00 Customer Experience Coordinator(1) Concierge,Host,Receptionist,Customer Service,Loyalty Program $ 24,960.00 Community Benefits Liaison(1) Neighborhood&Community Outreach,Local Programming Contract Customer Experience Coordinator(2) Host&Receptionist,Patient Service,Loyalty Controller TBD Cannabis Retail Clerks(6) Daily Operations&Logistics,Customer Sales Coordination $ 29,120.00 Security Guards(2) Day to Day On Site Security Personnel Contract • Projected Total Payroll (Annual). $991,059 • How will Payroll be Processed (through a bank, credit union, third party payroll company or by cash) Payroll will be processed through a credit union. • How will Payroll Taxes be withheld? Payroll taxes will be withheld and remitted to appropriate taxing agencies by Cannabis Kingdom's payroll processor. • How will Sales be Accounted For(Software System, Point of Sale or otherwise)? Sales records and invoices will be maintained for a minimum of 7 years following the date the transaction occurred and will be made available for inspection and reproduction to the Bureau. Sales invoices and receipts will be maintained electronically and will be filed in such manner as to be readily accessible for examination by employees of the licensing authorities. All sales will be accurately, and completely entered in Cannabis Kingdom's chosen computerized seed-to-sale system and CCTT-METRC. The Inventory Compliance Manager will ensure that if Cannabis Kingdom's chosen computerized seed-to-sale system is not functional for any reason that all transactions are properly recorded manually and entered into CCTT-METRC as soon as it is accessible. Cannabis Kingdom will only sell cannabis goods to customers under the following conditions: The cannabis goods were received by Cannabis Kingdom from a licensed distributor or licensed microbusiness authorized to engage in distribution; • Cannabis Kingdom has verified that the cannabis goods have not exceeded their best-by, sell- by, or expiration date if one is provided; • In the case of manufactured cannabis products, the product complies with all requirements of the California Business and Professions Code; • The cannabis goods have undergone laboratory testing as required by the Bureau; • The batch number is labeled on the package of cannabis goods and matches the batch number on the corresponding certificate of analysis for regulatory compliance testing; and The packaging and labeling of the cannabis goods complies with the California Business and Professions Code, all applicable regulations, and the California Code of Regulations. • How will Project Transportation/Distribution Security be Addressed? Cannabis Kingdom will only transfer cannabis goods between licensed premises and will ensure that inventory being transferred is thoroughly tracked in CCTT-METRC to prevent diversionary practices. If Cannabis Kingdom is not a licensed distributor and seeks to transfer cannabis goods for retail sale, it must only transfer goods, through a licensed distributor, to another licensed retail premises if Cannabis Kingdom and the other retail licensee are held under the same ownership. Only Cannabis Kingdom employees or security personnel who are 21 years of age or older with a clean driving record and a valid driver's license can transport inventory on behalf of Cannabis Kingdom. All vehicles and trailers used for transportation will have a motor carrier permit and be owned or leased, in accordance with the California Vehicle Code, by Cannabis Kingdom. The vehicles used in the-trarlspWatioTl ofrc7rff bis-goods-w#t-rmt-have-any-martIrlys of other ifdicatiorrs-orrtherexteror- — of the vehicle that may indicate that the vehicle contains cannabis or cannabis products. Vehicles used will have enclosed, windowless cargo sections where the shipping containers holding cannabis and cannabis products will be securely stored in order to ensure that cannabis and canna6rs"II not visible or� from ou a of Me vehicles The Vehicles will be equipped with an active vehicle alarm system. Cannabis Kingdom will not transport or allow the transport of., • Cannabis goods by means of aircraft, watercraft, drone, rail, human powered vehicles, or unmanned vehicles; and • Non-cannabis goods, except for cannabis accessories, Cannabis Kingdom's branded merchandise, or Cannabis Kingdom's promotional materials. Cannabis Kingdom will provide the Bureau with the following transport vehicle information for each vehicle and trailer used to transport cannabis: Proof of ownership or valid lease; The year, make, model, license plate number, and VIN; Proof of insurance. Cannabis Kingdom will submit a Notification and Request Form to the Bureau if there are any changes to this information within 30 calendar days. Transportation vehicles are subject to inspection by the Bureau at any licensed premises or during transport at any time. Cannabis Kingdom will maintain all contracts with distributors, all shipping manifests, transportation bills of lading, sales receipts, and any other documentation related to the transportation of cannabis goods to and from Cannabis Kingdom's facility. Cannabis Kingdom will make these documents available to the Bureau upon request. • Will you or persons you employ be seeking concealed weapons permit or similar? No • Describe ALL chemicals and fertilizers to be used on site and their toxicity? How will said be disposed of after use (including within water/sewer system)? None D. Security Plan (Security Plans shall be submitted as a separate document and incorporated as an attachment to the project description). Each cannabis business site shall have security plan approved by the Sheriff's Department. The security plan shall be a narrative and also an include a detailed security plan delineating the physical location of the specific equipment. The proposed security plan must include the following at a minimum: • Summary of the security plan, this shall be included in the project description, all other elements shall be incorporated as a separate attachment, entitled security plan, to the project description. • S - - system must be installed to monitor all doors into the buildings on the site, the parking lot, loading areas, and all exterior sides of the property adjacent to the public rights of way. The cameras and recording system must be of adequate quality, color rendition, and resolution to allow-the identification of any individual present on-the site. The-recording system must be capable of exporting the recorded video in standard MPEG formats to another common medium, such as a DVD or USB drive. • Security video recording and retention. Video from the security surveillance cameras must be recording at all times (24 hours a day, seven days a week) and the recording shall be maintained for at least 30 days. The video recordings shall be made available to the City upon request. • Location of security cameras and the areas to be covered by the security cameras. See Security Map • Location of audible interior and exterior alarms. See Security Map • Location of exterior lighting. See Security Map • Name and contact information of Security Company Post Alarm Systems Thomas Johnson 47 E. St Joseph Street Arcadia, California 91006 Office: 626-446-7159 • Whether entrances to all dispensing and cultivation areas will be locked and under control of staff at all times. Yes • Name of security guard and proof that security guard is licensed by the California Department of Consumer Affairs and whether security guard will be present at the medical marijuana facility during all hours of operation. Licensed Security Guard company will be engaged upon approval of CBP/CUP from the City of Lake Elsinore. • If the security guard is to be armed, proof that security guard possesses a valid Security Guard Card and Firearms Permit issued by the California Department of Consumer Affairs. Will not be armed. . Alarm system. Professionally and centrally-monitored fire, robbery, and burglar alarm systems must be installed and maintained in good working condition. The alarm system must include a private security company that is required to respond to every alarm. Post Alarm System will provide monitoring for the alarm system and will provide for a private security response to every alarm. F. Fire Protection Plan. (Security Plans shall be submitted as a separate document and incorporated as an attachment to the project description). Each cannabis business site shall have fire protection plan approved by the Fire Marshal. The fire protection plan shall be a narrative and also include a detailed fire protection plan delineating the physical location of the specific equipment. The proposed fire protection plan must include the following at a minimum: • Summary of the fire protection plan, this shall be included in the project description, all other elements shall be incorporated as a separate attachment, entitled security plan, to the project description. See Fire Protection Summary and Plans • Occupancy Classification. The Use and Occupancy Classification of Marijuana Business. Please identify the proposed use and occupancy classification of the proposed use. Use and occupancy classifications may be found in Chapter 3 of the International Building Code (IBC), and International Fire Code (IFC). • Hazard Communication. When storing or using any type of hazardous materials, IFC Section 407 should be followed and the appropriate paperwork made accessible to the fire code official. Additionally, IFC Sections: 5001.3- 5001.6.3 should be consulted. Section 407 of the IFC gives responders the information of the hazardous chemicals that is on the property. o Material Safety Data Sheets (MSDS) shall be on property and made easily accessible. o Containers and/or packages related to hazardous materials shall be properly labeled and warning signage shall be properly displayed and easily visible. o All persons shall be trained on what to do in the event of an emergency involving hazardous material on the property. Fire protection plans shall refer to the location of all hazard communication information. • Interior Finishes. It is common in marijuana grow facilities to use a Visqueen® or Mylarfl type plastic/polyethylene or polyester sheeting to cover walls and ceilings. Any use of plastic to enclose rooms or cover walls and/or ceilings must be installed in accordance with building and fire code requirements. Interior finishes must comply with flame spread ratings in accordance with Table 803.3 of the IFC. (Note: Hanging plastic from ceilings or suspended overhead structures to create wall dividers is typically NOT compliant with code provisions for a wall partition or interior finish.) . Exits and Exit Signage, Egress Security measures are often extreme in marijuana facilities. The desire for security in no way overrides the minimum requirements for exiting -and`egress.-Common-issues-associated-with-exits-and-egresses-a re-as-follows--Number of exits shall be in accordance with Table 1006.2.1 and Table 1006.3.2(2) and Section 1017.2 of the IFC. Fire protection plan shall identify o Means of egress cannot be concealed in any way. o Exit doors and their function (these cannot be eliminated without prior approval). o Where 2 or more exits are required, egress doors are required to swing in the direction of egress travel. o Where more than one exit is required, illuminated exit signs are to be provided that must be readily visible from any direction of egress travel. o Intermediary exit signs may also be required per Section 1013 of the IFC. o H occupancies require specific considerations for exiting. • Locks and Key Box Where security and life safety objectives conflict, alternative measures may be required or permitted by the City. SECURITY GATES— Due to the increased security measures typically required, and the potential hazards associated with marijuana facilities, the City is authorized to require that any security gate be installed across a fire apparatus road first be approved before installation. o KEY BOXES — Installation of a key box in an approved location, which will permit timely access to the facility in the event of an emergency shall be identified. o LOCKS —The installation of"approved" locks on any and all gates or similar barriers, which will permit timely access to all areas of the facility's property in the event of an emergency. If the facility has electronic access controls, the City will require an access code or electronic access card be provided. o BOLTS, BARS, LOCKS & LATCHES — Egress doors are required to open easily when exiting without the need for a key, without using extra effort and/or without having special knowledge in order to operate the installed hardware. Door handles, pulls, latches, locks and other operating devices should be free of tight grasping, tight pinching or twisting of the wrist to operate. Slide bolts, security bars, dead bolts, thumb latches and similar hardware items are prohibited from being installed on emergency egress doors. o ALTERNATIVE LOCKING DEVICES - Delayed egress locks and electromagnetic locks are permitted for use in other occupancy types, and must be approved for use by the City. • Fire suppression systems. Fire protection plan shall include all suppression systems designed to meet the specific E. Closure Plan • Summary of the remediation plan. This shall be included in the project description, all other elements shall be incorporated as a separate attachment, entitled security plan, to the project description. . Remediation Plan. Describe how Cultivation/Retail Facility will be remediated at end of use? (Process of Removing Equipment, Chemicals, and other items/remnants). • A closure cost estimate. Closure costs include the expenses for ceasing operation of the cannabis facility and safely closing the unit and cleaning up any contamination. Post closure care costs include long-term maintenance of the unit or facility, monitoring, and record keepirrg-during e required post-closure-care p-end--Own-effopeeratoT�caiculate cost estimates based on the cost of paying a third party to perform the required closure and post-closure care activities as outlined in the facility's remediation plan. Cost estimates must be adjusted annually throughout the operational life of the facility to account for inflati . Surety Bond. A surety bond from a surety company shall be submitted and maintained through out the life of the cannabis business permit that all closure and post-closure care requirements will be fulfilled. If the owner/operator fails to meet the requirements specified in the bond, the surety company is liable for the costs. A Surety Bond will be obtained upon issuance of a CBP/CUP by the City of Lake Elsinore. CANNABIS - -KINGDOM- Business Plan OWNERS Business name: Vert Lake Elsinore,LLC dba Cannabis Kingdom Address: 31875/31881 Corydon St.Units 120/160 Lake Elsinore,CA 92530 Telephone: (619) 254-0263 Fax: (619) 270-2575 E-mail: saif@cannabiskingdom.com Page 1 �e CANNABIS KING1) 0M - TABLE OF CONTENTS TABLEOF CONTENTS...............................................................................................................................................................2 EXECUTIVESUMMARY............................................................................................................................................................3 CK's Industry Experience is Paramount to its Success........................................................................................................3 Overview of CK's Innovative and Immersive Business Model............................................................................................4 Prioritizing Safety&Security:The Gold Standard ..............................................................................................................5 FinancialSuitability CK's Key to Success.............................................................................................................................6 Security&Safety,Track&Trace,Odor Control..................................................................................................................6 StaffTraining. .....................................................................................................................................................................8 MEDIANPROJECTED REVENUE...............................................................................................................................................9 ORGANIZATIONALSTRUCTURE.............................................................................................................................................10 OBJECTIVES...........................................................................................................................................................................11 Goals&Objectives............................................................................................................................................................11 MissionStatement............................................................................................................................................................12 Factorsfor Success............................................................................................................................................................12 RiskFactors.......................................................................................................................................................................12 THEBUSINESS .......................................................................................................................................................................13 Background &Structure....................................................................................................................................................13 Outside Consultants& Professional Advisors...................................................................................................................13 Customers.........................................................................................................................................................................13 Suppliers............................................................................................................................................................................14 DESCRIPTION OF PRODUCTS&SERVICES.............................................................................................................................14 Products &Services...........................................................................................................................................................14 ContingencyPlan...............................................................................................................................................................14 Facilities &Operations......................................................................................................................................................14 Page 2 CANNABIS - K I N G D 0 M- EXECUTIVE SUMMARY Vert Lake Elsinore (the "Business") is a Limited Lability Company primarily owned by Saif Alchi (the "Principal".. Zaid Aoro will oversee operations management. The business will operate under the name Cannabis Kingdom"CK". The new cannabis business will not only serve the City of Lake Elsinore, but also draw customers from the surrounding areas,brining additional tax revenue to the City. Cannabis Kingdom's long-term goals are to provide safe, high-quality products to customers in an efficient and expedient manner, so as to encourage repeat business and create a loyal customer base. Also, to Cannabis Kingdom's goal is to be a valuable asset to the City, creating quality jobs and a positive addition to the business community. CK's Industry Experience is Paramount to its Success Saif Alchi (Managing Member) and Zaid Aoro (Operations Manager) each bring significant real-world cannabis including related retail and hospitality experience in excess of fourteen(14)years collectively. In order to bring the best to the City,Cannabis Kingdom has a highly qualified management team,including experienced professionals in multiple disciplines. Sai Alchi Saif Alchi has been in the financial industry for nearly 20 years. Currently,he holds a position of CFO at a defense company. He handles all major finance decisions. He is responsible for managing company cash,preparing and filing quarterly/annual financial reports,overseeing accounts payable and receivable,budgeting,and reviewing payroll records regularly for accurate job costing. Along with his financial experience,he has knowledge in the consumer goods space. Managing multiple retail stores and filling station businesses. Inventory controls, employee management,and security were his most important values. Saif holds a Bachelor of Science in Business Management. He also holds a Master of Business Administration in Finance. Page 3 CANNABIS - KINGD (7) M Zaid Aoro Zaid Aoro is an entrepreneur who has many years of experience in the retail and distribution fields. He currently manages a licensed cannabis retail operation and has expanded the business to levels never seen before. He currently manages purchasing,marketing,and overseas sales. He has managed many retail operations and was in charge of up to 50 employees on a given day. He excels in inventory control,security supervision and sales. His passion for retail management began when he was a teenager managing family owned businesses. Zaid holds a Bachelor of Science in Software Engineering and had minor in business management. Salam Alchi Serving as the Logistics &Technology Director, Salam Alchi will continually work to keep CK at the cutting edge of technology innovations that benefit the business' patrons. In strategic coordination with Saif Alchi, Zaid Aoro will act as the Retail Operations Manager. He has over a decade of cannabis retail experience including the development and implementation of compliance protocols and training. CK plans to continue in this spirit of engaging the local community non-profit organizations and donate to schools in the surrounding areas. Overview of CK's Innovative and Immersive Business Model CK's Operations Plan was developed based upon the real-world knowledge garnered from its team's flourishing retail businesses in California.The Business Operations Plan addresses standard commercial retail issues as well as those unique to the cannabis industry.An essential theme in operations of the business is crafting a meaningful and effective consumer experience. In a high-tech, fast paced digital world, CK wants customers to benefit from technology innovations while still feeling connected. With a fully interactive webpage and mobile app (pending) patrons can place an order for in-store pickup or home delivery and still communicate directly and securely with a CK Cannabis Ambassador who is trained to listen actively and provide educated guidance to both experienced and novice consumers.CK's dedication to technology advancements synergistically work with back of house operations implementing an efficient fulfillment center serving retail and delivery operations. Page 4 CANNABIS KINC., D0M - In order to fully bring the CK experience to life,the Company will invest in creating immersive customer experiences within the retail area. Brand activation areas will be stationed throughout the store to engage the consumer in multiple dynamic exchanges with brand ambassadors. As a further investment into the community, CK is committed to hiring locally and promoting from within. CK will pay all of its employees no less than $15.00 an hour,above the current minimum wage. CK will train its employees to work in all aspects/use types in addition to specific training in the following areas: Impaired customers:to ensure responsible consumption,safety of the impaired. Product Offerings: CK's staff education materials developed by our experienced and knowledgeable professionals will ensure patrons understand how cannabis can be used responsibly as part of an alternative wellness regime.Staff will be trained to understand they are not permitted to give medical advice or guarantee overt medical claims of cannabis.They will instead provide recommendations and anecdotal evidence from client testimonials. Customer Service: Staff will always conduct themselves in a manner that is approachable,courteous and respectful. CK takes its responsibility to be a good neighbor and steward of the industry seriously and is devoted to the highest levels of community responsiveness. To that end, we plan to have a community affairs liaison dedicated to responding to any and all issues by the community twenty-four hours a day, seven days a week, and their contact information will be readily available to the public via the website and on file with the local law enforcement and the City. Prioritizing Safety&Security: The Gold Standard Physical security will extend beyond the premises by a two-block radius in order to deter neighborhood crime and loitering.All employees will receive comprehensive safety,security,and emergency response training.Additionally, all employees and contractors will undergo a background check prior to starting their employment.CK will maintain Page 5 CANNABIS K 1 N G D 0 M and consistently update a registry of employees and vendors.Every detail in the Security Plan is designed to exceed the standards set by the City and those at the State level providing allowance for continual updates as changes are made at the State level and advancements are made with regard to best practices. The Head of Security will reach out to start discussions with local fire and law enforcement to design the optimal security protocols.CK will appoint a Security Liaison from within the local community,and their information will be kept on file with the City and the police. Financial Suitability CK's Key to Success With an integrated business model CK's overall costs are flattened throughout the operations resulting in increased net revenues. With a strong understanding of financial scalability CK is primed for success. A summary of the overall financial projects for the integrated location is attached to this business plan. Cannabis Kingdom can also provide proof of funds for over$1,000,000 for capital expenditures,and additional funding for operations. JOBS Cannabis Kingdom is committed to providing for an exceptional work environment and creating quality jobs,and as such,has committed itself to paying enhanced wages and benefits. The attached Labor and Employment Plan details Cannabis Kingdoms commitment to such. Security&Safety,Track &Trace, Odor Control Security&Safety CK is dedicated to providing a safe,secure and pleasurable environment for all customers,visitors,and employees. CK will provide a seamless experience for our customers,while providing a high-level of alert and engaged coverage to the facility in an effort to detect, report, and minimize any dangerous situations, bad behaviors or criminal activities. A highly visible and capable security staff will help ensure a safe environment. CK has established a security plan and best practices which shall be implemented to ensure the security of the product,the facility,and the staff. The standards and procedures established here provide a safe working environment while protecting against diversion and theft. All security measures have been adopted from current Best Management Practices (BMPs)pertaining to the securing of a cannabis retail dispensary specific to property and facility. Page 6 CANNABIS -- KINCF) 0M------- This Security plan applies to all company employees, visitors, vendors, and outside carriers. CK will establish and provide reputable,licensed,and bonded security with a designated leader accountable to management.CK will also engage a qualified, local security vendor to install, monitor, and maintain a comprehensive electronic surveillance system, inclusive of alarms that will be continuously active and monitored. This security protocol will be kept in a secure location and shared only on a"need-to-know"basis with appropriate regulatory officials and employees. CK will annually update a list of local and state emergency contacts,and local public health officials. Track& Trace CK will create and maintain an active functional account within the State of California's track and trace system prior to engaging in any commercial activity to prevent the possible diversion of cannabis products. CK will report all identifying information for cannabis products including the purchase, sale, test, packaging, transfer, transport, return, destruction, or disposal of any cannabis goods. The COO &GM will designate an employee as the track and trace system Account Manager along with oversights needed. He/she will attend and successfully complete all required track and trace system training,including any orientation and continuing education. Odor Control CK is aware that an important part of being a good cannabis retail establishment is being a positive member of the community.Understanding the fears of possible odor spread,CK has identified industrial strength odor elimination filters that will be purchased to ensure complete odor mitigation. It is a priority for CK to safeguard against any possible inconveniences and to be a good neighbor. Marketing We understand that marketing is essential to the success of any retail venture and so our efforts will concentrate on: • Developing brand awareness • Building a loyal and passionate customer base,while increasing.lifetime value (LTV) of our customers. • Establishing our shops as premier adult-use recreational retail facilities. Page 7 CA 13IS - K 1 N G D 0 M-- Driving month-over-month revenue growth by 5%in the first 2 years Our strategy is based on a general three-step approach: • Attract Customers: The first component of our strategy is to elevate visibility. Develop and execute an inbound marketing strategy unique to our business. Inbound marketing refers to a technique for attracting customers to a company's website, social channels, and physical store via content marketing, social media and search engine optimization. Examples of tactics employed include content marketing,local marketing,search engine optimization, and word-of-mouth. • Engage Customers: The second component of our strategy is customer engagements; the marketplace is highly competitive and thus developing a one-to-one relationship with consumers is essential to create loyalty, passion, and brand awareness for promotional campaigns. Examples of this include developing unparalleled customer service,leveraging social media to create buzz around our brand,event marketing,and video marketing. •Nurture Customers:The difference in cost between acquiring a new customer versus retaining one(and increasing their lifetime value to your business) is immense. Harvard Business Review puts the cost differential as being anywhere from five to 25 times more expensive than acquiring new customers. Retaining customers, if done right, is quite simple; keep them happy. Our "nurture" campaigns are focused on driving customers back to our store, repeatedly, so that their purchasing behavior becomes habitual. Examples of tactics employed includes deals & discounts, email marketing,loyalty programs, mobile marketing, online reputation, management&online reviews, and text message marketing. Staff Training While not directly related to marketing,front line staff are an integral part of enforcing all of the efforts put towards attracting customers.Without an appropriately staffed and trained team,all of the value gained through marketing efforts can be compromised.Aside from the products,the quality of service,showcasing the company's culture and identity will determine the level of customer satisfaction.Our employees are our best sellers.They will recommend products and engender in the customer the confidence that they have transacted beneficially with premiere retail experience.A comprehensive staff training program will be in in place to ensure a high-quality customer experience and for compliance education. Page 8 NJnr, n �,J PROJECTED REVENUE The business is projected to start operating in May 2020. Below are projections by each division of the business: Manufacturing Projected Annual Sales: Products: Units: Unit Price: Total Sales: Pre-rolls 20,876 $ 28.96 $ 604,563 Cartridges 62,641 $ 48.50 $ 3,038,069 Wax 18,792 $ 50.25 $ 944,312 Edibles 46,060 $ 35.25 $ 1,623,625 Annual Sales: $ 61210,570 Division Sales Percent of Total Manufacturing $ 61210,570 47% 72% Distribution $ 31445,845 26% Retail $ 31697,389 28% 28% Total Annual Sales $13,353,803.59 Page 9 CANNABIS K I N G D O M — ORGANIZATIONAL STRUCTURE VERT LE ORGANIZATIONAL NAME FPRIMARY EXPERTISE I TITLE I ROLE LOCATION • OPERATORS The Owners/Principals will spearhead operations of the retail,ma establishment as key agents in developing a blueprint for the business,compliant policies,and quality control procedures. The Owners&Principals comprise of founders and operators responsible for implementation of strategies and ensuring execution through management protocols. Managing Member&Bus. Saif Alchi Managing Member,Vert LE Development Financial Management,Development,&Strategy San Diego,CA Operations,Employee Management,Training,& Zaid Aoro Manager of Cannabis Kingdom Operation Lead Compliance San Diego,CA Vert Holdings, Inc Minority Owner Member Alana Alchi CA Attorney at Law,Alchi Law Compliance&Legal Liaison Legal,Compliance&Legislative Liaison San Diego,CA CONSULTANTS Members of the Consultant Council are strategically integrated to lend their vast experience and skills to our Executive and Management Committee.They serve to enhance all aspects of the business to function effectively,Responsibly and Optimally. GMEP Engineers Engineering Rob Mothershed Architecture CA Certified Public Accountant Abbo Tyson Abbo Tax I Principal:Abbo Tax Tax Advice and filings 1 San Diego,CA Array of Insurance Services-GL,WC, Branch Director-Webster Daniel Webster and Equipment Insurance Services I Advising on the insurance products needed. San Diego,CA EMPLOYEES The employees are the ambassadors to our clients and the community.Carefully selected and trained,they will reflect and resemble the Vert LE culture,values,and ethos through a service oriented approach. TBD TBD Assistant General Manager(1) Daily Operations,Management&Execution 41,600.00 TBD TBD Head of Security(1) Daily On Site Security Management Contract Administrative Assistant/ $ TBD TBD Bookkeeper(1) Office Manager,Record Keeping 35,360.00 Inventory/Product Intake&Fulfillment(Delivery $ TBD TBD Quality Controls Specialist(1) &Online Orders 31,200.00 Customer Experience Concierge,Host,Receptionist,Customer Service, $ TBD TBD Coordinator(1) Loyalty Program 24,960.00 Neighborhood&Community Outreach,Local TBD TBD Community Benefits Liaison(1) Programming Contract Customer Experience Host&Receptionist,Patient Service,Loyalty TBD TBD Coordinator(1) Controller TBD Daily Operations&Logistics,Customer Sales $ TBD TBD Cannabis Retail Clerks(6) Coordination 29,120.00 TBD TBD Security Guards(2) Day to Day On Site Security Personnel Contract Page 10 CANNABIS K I N G D O M CK's Executive &Management Committee is responsible for establishing the strategic policy for the company with the objective of expanding CK's footprint and conducting business true to their core values of compliance,ethics,and teamwork.The Advisory&Consultant Council plays a key support role within the organization assisting across many areas with subject matter expertise. CK comprises of individuals that have achieved previous success within their respective industries who have come together to build an accomplished cannabis retail company. Please view the organization structure chart as a reference. OBJECTIVES Goals &Objectives The Business'sales goals are: • Revenues of$3,500,000 by the end of Year 1,and$5,500,000 by the end of Year 3 of the Plan. • Gross profits margin of at least 50% • Positive net worth by the end of Year 1 • Increase market share by 10%year after year. In order to attain the above goals,CK will carry out the following specific objectives: • Hire well trained management and staff customer service • Establish a training program for new hires • Focus on customer service • Maintain compliance • Principal to be involved with the business • Improve current and past business practices • Invest in newest technology for inventory control Page 11 CANNABIS - K ING DO M - • Purchase new manufacturing equipment: i. Purchase (1) Rosin Press Machine ii. Purchase (1) Pre-roll machine iii. Purchase (1) cartridge filling machine iv. Purchase (1) packaging and labeling machine Mission Statement The Business will provide high-quality,efficient affordable products and services to local residents,and businesses. By providing top level quality and communicating effectively with our customers, Cannabis Kingdom will generate enough repeat customers to provide a stable client base and generate sufficient profits to meet the needs of the business and the financial goals of the owners. By 2020, Cannabis Kingdom will be well positioned and recognized as a leader in the Cannabis industry. Factors for Success The keys to the Business'success are: • Marketing and networking while creating a brand name. • Provision of high-quality reliable customer service. • Developing good long-term relationships with customers and suppliers. Risk Factors The Business has identified the following risk factors which could hamper its success: • Problems generating visibility and positioning; • Overly aggressive and debilitating actions by competitors; • Loss of a key customer/supplier; • Changes in federal or state/provincial legislation applicable to the Cannabis industry. Page 12 CA BIS - -KINGDOM - - THE BUSINESS Background &Structure The Business is a Limited Liability Company,owned by Saif Alchi (the"Principal"). The Principal have over five years of experience in the Cannabis industry and holds the appropriate licensing and certifications. The Principal has injected $500,000 of his own capital into the Business as start-up capital. He will continue to fund the business to ensure the continued success of Vert Lake Elsinore. Outside Consultants & Professional Advisors The Business'outside consultants and professional advisors provide tremendous input and support to enable management to make well-informed,creative and appropriate decisions: At present,the following consultants have been engaged: • Abbo Tax-CPA Firm • Webster Insurance-Insurance Services • Cody Campbell-Professional Advisor • Alana Alchi,Esq.-Legal Counsel • GMEP Engineers-Engineering • Rob Mothershed-Lead Architect Customers The Business has developed solid relationships with major local brand name retailers for distribution and manufacturing opportunities. The retail department of the business will focus on reaching most cannabis consumers in the local and surrounding areas by offering excellent quality product at unbeatable prices. Page 13 CANNABIS K ING D n M Suppliers Having a dependable and economic supply of raw material in the Cannabis business is extremely important. The Business also has good relationships with several other packaging,labeling,and other manufacturing suppliers. A list of these suppliers can be supplied upon request. DESCRIPTION OF PRODUCTS & SERVICES Products &Services The Business will provide and array of Cannabis services to include the Manufacturing, Packaging, Distribution, Retail,and Delivery of Cannabis products. In addition,we will be able to manufacture and distribute specialty products to other licensed cannabis retailers to help increase Cannabis Kingdom's brand footprint. Contingency Plan If the Principal is injured or ill and temporarily unable to work,the Business will hire a replacement on piecework to assure continuity of service. The Principal can secure the services of three experienced managers in case of emergency,to keep the business running and ensure that there is no downtime. Facilities & Operations Cannabis Kingdom currently has a lease in place for an approximately 5,602sf space for manufacturing and distribution and an ancillary approximately 2,497sf location for retail sales, of which 1,538sf would be used for a retail sales area. Both buildings are co-located within the same industrial condo property and are separated to provide for the highest levels of safety and security, while maintaining the City's desired focus on product manufacturing and job creation. Page 14 FLLC-1 2 20-A95827 ° •; Secretary of State o. h� a Statement of Information FILED (Limited Liability Company) °ac go�w`r In the office of the Secretary of State IMPORTANT—Read instructions before completing this form. of the State of California Filing Fee—$20.00 FEB 27, 2020 Copy Fees—First page$1.00;each attachment page$0.50; Certification Fee-$5.00 plus copy fees This Space For Office Use Only 1. Limited Liability Company Name(Enter the exact name of the LLC. If you registered in California using an alternate name,see instructions.) VERT LAKE ELSINORE LLC 2. 12-Digit Secretary of State File Number 3. State,Foreign Country or Place of Organization(only if formed outside of California) 201928310466 CALIFORNIA 4. Business Addresses a.Street Address of Principal Office-Do not list a P.O.Box City(no abbreviations) State Zip Code 29 CENTAURUS WAY COTO DE CAZA CA 92679 b.Mailing Address of LLC,if different than item 4a City(no abbreviations) State Zip Code 29 CENTAURUS WAY COTO DE CAZA CA 92679 c.Street Address of California Office,if Item 4a is not in California-Do not list a P.O.Box City(no abbreviations) State Zip Code 29 CENTAURUS WAY COTO DE CAZA CA 92679 If no managers have been appointed or elected,provide the name and address of each member.At least one name and address 5. Manager(s)or Member(s) must be listed.If the manager/member is an individual,complete Items 5a and 5c(leave Item 5b blank) If the manager/member is an entity,complete Items 5b and 5c(leave Item 5a blank). Note: The LLC cannot serve as its own manager or member. If the LLC has additional managers/members,enterthte name(s)and addresses on Form LLC-12A(see instructions). a.First Name,if an individual-Do not complete Item 5b Middle Name Last Name Suffix Saif Alchi b.Entity Name-Do not complete Item 5a c.Address City(no abbreviations) State I Zip Code 15988 Sarah Ridge Ct San Diego CA 92127 6. Service of Process(Must provide either Individual OR Corporation.) INDIVIDUAL—Complete Items 6a and 6b only. Must include agent's full name and California street address. a.California Agent's First Name(if agent is not a corporation) Middle Name Last Name Suffix ROBERT HAWEKOTTE b.Street Address(if agent is not a corporation)-Do not enter a P.O.Box Citty�(no abbreviations State Zi Coda 29 CENTAURUS WAY Cl - - DE CAA CA �2679 CORPORATION—Complete Item 6c only. Only include the name of the registered agent Corporation. C.California Registered Corporate Agent's Name(if agent is a corporation)—Do not complete Item 6a or 6b 7. Type of Business a.Describe the type of business or services of the Limited Liability Company RETAIL SALES 8. Chief Executive Officer,if elected or appointed a.First Name Middle Name Last Name Suffix b.Address City(no abbreviations) Stale Zip Code 9. The Information contained herein,including any attachments,is true and correct. 02/27/2020 Saif Alchi Member Date Type or Print Name of Person Completing the Form Title Signature Return Address(Optional)(For communication from the Secretary of State related to this document,or if purchasing a copy of the filed document enter the name of a person or company and the mailing address.This information will become public when filed. SEE INSTRUCTIONS BEFORE COMPLETING.) Name: F Company: Address: City/State/Zip: L LLC-12(REV 01/2017) Page 1 of 1 2017 California Secretary of State www.sos.ca.gov/business/be a PROPERTY OWNER CONSENT FORM Commercial Cannabis Business PROPERTY OWNER INFORMATION Timothy J. Scglzo ❑ Owner ❑ Manager ® Other: Successor Trustee Name Title The Frederick Thomas Scalzo Separate Property Trust, dated February 27, 2018 Business Name(if applicable) Phone Number PO Box 1660 San Juan Capistrano CA 92693 Mailing Address city state Zip Code PREMISES INFORMATION 31875 Corydon St,Ste 120/31881 Corydon St,Ste 160 Lake Elsinore CA 92560 Physical Address city state Zip Code Vert Lake Elsinore, LLC Tenant Applicant(Business Name) IN Optional - Copy of the property lease agreement attached DECLARATIONS AND SIGNATURE I hereby certify that I am the property owner and/or manager of the premises referenced in the Premises Information section, and authorized to complete this form on the property owner's behalf. The property owner acknowledges that the above-mentioned tenant has the legal right to occupy the property and acknowledges and consents to the conduct of commercial cannabis manufacturing activities on the property. ignat Dat r CALIFORNIA NOTARY ACK. /JURAT ATTACHED ° 3ic-)4 /202Z) �6K:'�C92Y.S.^SL:-1!0!:f."�1.�J7'/.!�G4hL'SEYIAA^/.C,II.J3%E1IJ�N:iRipil/.I L:S�/.:/%4n/l!.�'cvll+�.�1%«''JR�"� 3::.1:1tY-V.fetx".fdtriOAt�.fL"�:i%A':iYY•':fOIMJR.:K:9/IYtldY.'^J.TYX.:9�}CXt^'JLY..Y.Y7), gg '' CALIFORNIA JURAT e A notary public or other officer completing this certificate verifies only the identity of the individual(s)who signed the document to which this certificate is attached,and not the truthfulness,accuracy,or validity of that document. STATE OF CALIFORNIA ) ss COUNTY OF ORANGE ) i Subscribed and sworn to(or affirmed) before me on this -1�7—day of 202 - i by (i rnb T-t-t y 3• S e-AL-.-�X-o who proved to me on the basis of satisfactory evidence to be the person($)who appeared before me. 10 0. 0. HEMANSHU P. MANIm a COMM...2257720 k m NOTARY PUBLIC-CANFORNIA Signature ORANGE COUNTY (A) My Term Exp.Oct.7,2022 i, o OPTIONAL Though this section is optional,completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. Description of Attached Document Title or Type of Document P44r -CWv-a.j,,- Document Date Y Number of Pages 1 _ Signers Other Than Named Above: 10 .y.�1/t/d1Jll.1/rell>b^' �Y�LY.•.:�ISIIIll^._.._».%Nrs�vv�irnfl:rlfuY�Gt�{Ef.•u.:•rw..ns: riJlii:..�::�xIA-yie'J.�EWI�xIJLr'.aXw1�'/vaF�YAi�Y�1�ss7mwfi�Mt'l.•vls �i... •_. ryr�uw.:,:✓rnvtrn.•rzr.��✓f::/viu�i�icuuir,-.rutr..�e:ner.:.::r�r.�im cc:rserr�arr.�.-.er.�v..on.-::�nni�icx.-r,rcoawroi.+ts�viara'.ca�bcTt�ecrcva�r�ty� April 11, 2018 City of Lake Elsinore 130 South Main St. Lake Elsinore, CA 92530 RE: Conditions of Approval for Businesses Engaged in Cannabis Production/Distribution To Whom It May Concern: This letter shall serve as a conditional approval by the Blue Lake Industrial Condo Owners Association ("Association"), on the following and such other conditions to be determined at the Association's reasonable discretion, for any applicant ("Unit Owner") requesting the right to operate a cannabis production/distribution business within the Association pursuant to the City of Lake Elsinore Ordinance No. 2017-1383, any related or subsequent ordinance related to cannabis, and the applicable laws of the State of California: General 1. Unit Owner shall be required to submit a fully completed architectural application ("Application") in the form provided by the Association's management company, Equity Management, including a complete set of architectural and engineered drawings showing all planned modifications of the subject Unit and any proposed modifications to any Association owned and/or maintained Common Area as defined in the Association's governing documents. Unit Owner shall provide Association with such other information as may requested by Association that Association deems necessary and appropriate, in its reasonable determination,to process Unit Owner's Application. 2. Unit Owner shall promptly pay an application deposit ("Deposit"), to Association, in such amount as may be requested by Association, to be used towards the cost of processing the Application, including, but not limited to the employment of any consulting engineers or others whose services are used to act upon the Application. Unused Deposit shall be returned to Unit Owner(regardless of the remitter of the funds) within 30-days following the Association's final decision on the Application. 3. The Association shall be promptly reimbursed, in full, for all costs incurred by the Association in connection with the processing of the Application, including all costs in excess of any Deposit paid. 4. If Unit Owner fails to pay any amount due to Association in connection the Application within 15 days of presentation of bill, the Association shall cease the processing of the Application until such amounts are received in full by the Association. 5. Unit Owner shall indemnify and hold harmless the Association, its agents, managers, Directors, and Members from all claims, damages, losses and liabilities associated with the processing of the Application, any approvals granted therein, and the operation of the proposed business that is the subject of the Application. Conditional Approval of Cannabis Business Located with the Alesco Blue Lake Industrial Condo Owners Association City of Lake Elsinore April 11, 2018 Page 2 of 5 6. Association shall augment these conditions of approval with supplemental conditions as Association deems reasonable, necessary, and appropriate after Application has been received and evaluated. 7. The Association does not consent to the issuance of a building permit(s) by the City of Lake Elsinore for the construction of the improvements contemplated by the Application until such time as the Association has fully reviewed and approved the Application, which may require supplemental conditions as discussed above, and Unit Owner agrees not to commence with the construction of any such improvement or engage in the operation of the cannabis production/distribution business until time as the Association has approved the Application. Security and Parking 8. Unit Owner shall provide full time (24 hours per day/7 days per week/52 weeks per year) security within their Unit. All security personnel shall be properly credentialed and possess all licenses and permits as may be required by law. 9. Unit Owner may only install exterior mounted cameras upon approval of Association. 10. If Application includes a retail dispensary component,then Unit Owner shall police the Common Areas around the Unit to ensure that no customers of the dispensary loiter in the Association Common Areas at any time. 11. Customers of the dispensary may not consume cannabis products purchased at the dispensary within the Association Common Areas (including within a vehicle parking in the Association Common Area parking lot). 12. Parking in the Association is shared by all occupants and Unit Owner may not use more than its prorated share of the Common Area parking. Unit Owner shall be respectful of the parking requirements of the other occupants within the Association and not utilize the parking in front of Units other than its own. 13. Parking spaces may not be reserved without the Association's prior written approval. 14. Overnight parking is prohibited. Water Usage 15. If the cannabis production operation within the Unit entails a grow operation, the Unit Owner shall be required to pay for the additional water consumption and sewer fee charges incurred by the Association because of the operation. If the additional water consumption causes the Association to pay a higher cost of water based on a tiered allocation, Unit Owner shall also be responsible for those costs in addition to the cost of its metered water consumption and corresponding sewer fee charges. 16. Inasmuch as the individual Units within the Association were not designed or plumbed to be separately metered, modifications of the existing plumbing system may be required to better isolate and meter each Unit's individual water consumption. Association may also need to install one or more submeters for each building in addition to submeters on the Unit. The cost of all such plumbing modifications and installation Conditional Approval of Cannabis Business Located with the Alesco Blue Lake Industrial Condo Owners Association City of Lake Elsinore April 11, 2018 Page 3 of 5 of submeters shall be borne by Unit Owner. If more than one such grow operation exists within the Association, the Association will bill the cost of the plumbing modifications and submeter installation by Unit when feasible and will otherwise prorate the costs of such modifications and meter installations amongst all such Unit Owners evenly where a specific breakdown in billing costs is not otherwise feasible. 17. Attempts to individually submeter Units as described above notwithstanding, if the Association is unable to fully isolate the water consumption of the Unit, Association shall be entitled to make further adjustments to the water consumption as it deems necessary and appropriate to recoup the cost of excess water consumption of the Unit. 18. In addition to plumbing modification and meter installation costs and the water consumptions costs as set forth above, Unit Owner shall be responsible for the direct and indirect administrative costs for the reading and billing of the submeters. Electricity Usage 19. Inasmuch as the electrical power needs of a cannabis grow operation greatly exceed the power designed for, and provided to, each Unit within the Association,the additional power required has the potential to fully utilize or exceed the capacity of the building's switchgear, the feeders and underground conduits/ducts running from the Southern California Edison transformer to the building's electrical room, and the Southern California Edison transformer itself(collectively,the "Electrical System"),the cost of upgrading any of the Southern California Edison facilities and equipment or the Association owned Common Area electrical facilities and equipment required to facilitate the increased electrical needs of the Unit, including those requirements set forth in no. 21, below, shall be borne entirely by the Unit Owner. 20. All electrical work performed in the Association Common Area by Unit Owner(including without limitation, Unit Owner's tenants and contractors), whether in the landscape and parking areas/drive isles or within the electrical room, or within a separate interest unit of another Owner, shall be performed: a. At the exclusive expense of Unit Owner if such improvements solely serve Unit Owner's Unit. b. By a licensed, bonded, and insured contractor, approved in writing by the Association, who shall list the Association, and any other Owner in whose Unit work is performed, as an additional insured on its general liability policy having not less than $1,000,000 of coverage. c. Subject to further approval by the Association with respect to the design, location, construction standards, and other aspects of work of interest or concern to the Association to the extent that they are located within Association Common Area or any other portion of the Association other than in Unit Owner's Unit. 21. Regardless of whether (a) sufficient capacity currently exists within the Electrical System to supply the needs of the Unit Owner, or (b)the Unit Owner must upgrade the Conditional Approval of Cannabis Business Located with the Alesco Blue Lake Industrial Condo Owners Association City of Lake Elsinore April 11, 2018 Page 4 of 5 Electrical System pursuant to no. 19, above,the Electrical System must have a residual headroom load capacity equal to at least 50%of its current headroom load capacity after adding the additional load required by the Unit to the Electrical System. 22. If Applications are received by more than one Unit Owner necessitating the upgrade of all or a portion of the Electrical System, the cost to upgrade the Electrical System as required, above, shall be prorated between each Unit Owner requesting such additional power capacity according to the amount of increase in amperage to the Unit as requested by the Unit Owner on a building by building basis. If more than one building shares a Southern California Edison transformer, any costs to upgrade the transformer, the transformer pad/vault, and any related improvements thereto will be shared on a prorated basis accordingly. Trash 23. Unit Owner shall not dispose of any cannabis materials is Association dumpsters. All cannabis materials, soil, oils, and materials other than general non-hazardous trash must be disposed of at Unit Owner's expense with dumpsters stored within the Unit. Odor 24. Unit Owner shall be responsible to incorporate the use of electronic air filtration systems and undertake other measures (i.e. caulking all openings in walls between the Unit Owner's Unit and adjacent units, installing vapor barriers at openings for plugs, switches, and outlets in common walls) as necessary to prevent odor from traveling into adjacent units. The undertaking of such items does not relieve the Unit Owner from the obligation not to create nuisance odors for occupants and it is incumbent upon Unit Owner to take all steps necessary to ensure that the odor from the cannabis operation cannot be smelled from with other units or the Common Area. Signage 25. Unit Owner shall not install any signage visible from the exterior of the Unit indicating the nature of the cannabis production operation within. The Unit Owner may, however, install a sign in conformance with the Association's governing documents, subject to the Association's approval, identifying a retail dispensary operation that may be a component of the operation. Nothing herein shall be deemed to be an approval by Association of any signage proposed by Unit Owner. Insurance 26. In addition to any other insurance that may be required by the Association's governing documents, Unit Owner shall require the operator of the cannabis production business located within the Unit, whether it be the Unit Owner or a tenant, to obtain a general liability insurance policy, with products liability coverage, with limits no less than Conditional Approval of Cannabis Business Located with the Alesco Blue Lake Industrial Condo Owners Association City of Lake Elsinore April 11, 2018 Page 5 of 5 $5,000,000 naming the Association as an additional insured, which shall be primary coverage. 27. Unit Owner shall be responsible for any increase in the Association's insurance due to the operation of the cannabis production/distribution with Owner's Unit. If more than one such operation exists within the Association,the Association will prorate the amount of increased insurance costs amongst all such Unit Owners according to the square footage of each such Unit. Sincerely, Kelli Jones, Manager at the Direction of the Blue Lake Industrial Condo Owners Association Board of Directors Equity Management Unit Owner: (name of Unit Owner) I have read, understand, and agree to the terms and conditions as set forth, above: Signature Date By: Name (and title, if applicable)