Loading...
HomeMy WebLinkAboutC-20-20 Embarc Fresno RedactedApplicant (Entity) Information Application Type Proposed Location Commercial Cannabis Business Permit Application C-20-20 Submitted On: Dec 04, 2020 Applicant Dustin Moore dustin@goembarc.com Applicant (Entity) Name: Responsible and Compliant Retail Blackstone LLC DBA: Embarc Fresno Physical Address: 4592 North Blackstone Avenue Suite 301 City: Fresno State: CA Zip Code: 93726 Primary Contact Same as Above? Yes Primary Contact Name: Dustin Moore Primary Contact Title: Chief Compliance Officer Primary Contact Phone: Primary Contact Email: dustin@goembarc.com HAS ANY INDIVIDUAL IN THIS APPLICATION APPLIED FOR ANY OTHER CANNABIS PERMIT IN THE CITY OF FRESNO?: Yes Select one or more of the following categories. For each category, indicate whether you are applying for Adult-Use (“A”) or/and Medicinal (“M”) or both Both Please make one selection for permit type. If making multiple applications, please submit a new application for each permit type and proposed location. Permit Type Retail (Storefront) Business Formation Documentation: Limited Liability Company Property Owner Name: R&R Real Properties Inc Proposed Location Address: 4592 North BLackstone Avenue Suite 301 City: Fresno State: CA Zip Code: 93726 Property Owner Phone: Property Owner Email: rogerjrosen@juno.com Assessor's Parcel Number (APN): 428-010-15 Proposed Location Square Footage: Supporting Information Application Certification Owner Information 3370 List all fictitious business names the applicant is operating under including the address where each business is located: -- Has the Applicant or any of its owners been the subject of any administrative action, including but not limited to suspension, denial, or revocation of a cannabis business license at any time during the past three (3) years? No Is the Applicant or any of its owners currently involved in an application process in any other jurisdiction? Yes If so, please list and explain: Owners of the application are involved in applications in Martinez, CA, Contra Costa County, CA, El Dorado County, Pittsburg, CA, Tracy, CA, Fairfield, CA, and Concord CA I hereby certify, under penalty of perjury, on behalf of myself and all owners, managers and supervisors identified in this application that the statements and information furnished in this application and 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 and belief. I understand that a misrepresentation of fact is cause for rejection of this application, denial of the permit, or revocation of a permit issued. In addition, I understand that the filing of this application grants the City of Fresno permission to reproduce submitted materials for distribution to staff, Commission, Board and City Council Members, and other Agencies to process the application. Nothing in this consent, however, shall entitle any person to make use of the intellectual property in plans, exhibits, and photographs for any purpose unrelated to the City's consideration of this application. Furthermore, by submitting this application, I understand and agree that any business resulting from an approval shall be maintained and operated in accordance with requirements of the City of Fresno Municipal Code and State law. Under penalty of perjury, I hereby declare that the information contained in within and submitted with the application is true, complete, and accurate. Iunderstand that a misrepresentation of the facts is cause for rejection of this application, denial of a permit or revocation of an issued permit. A denial or revocation on these grounds shall not be appealable (FMC 9-3319(d)). Name and Digital Signature true Title Chief Compliance Officer Please note: the issuance of a permit will be determined based on the application you submit and any major changes to your business or proposal (i.e. ownership, location, etc.) after your application is submitted may result in a denial. All applications submitted are considered public documents for Public Records Act request purposes. For details about the information required as part of the application process, see the Application Procedures & Guidelines, City of Fresno Municipal Code Article 33 and any additional requirements to complete the application process. All documents can be found online via this link. For questions please contact the City Manager’s Office at 559.621.5555. Owner Name:Owner Title: Business Name: Embarc Fresno Application #: C-20-20 CANNABIS BUSINESS PERMIT APPLICATION REVIEW - RETAIL Points Possible All or None Exceptional Good Acceptable Applicant Score Evaluation Notes (Explain each time points are deducted) SECTION 1: BUSINESS PLAN 300 Points Possible for Section 1 Resume: Resumes Provided for All Owners: Score 5 5 5 Resumes Provided in 2-page Format: Score 2 2 2 Education: (select highest academic level among ownership team, cannabis specific education separately) Cannabis specific education/training (accredited)2 2 0 Education not specified for Owner High School Degree Reported: Score 4 4 0 Education not specified for Owner Bachelor's Degree Reported: Score 6 6 0 Education not specified for Owner Master's Degree or Higher Reported: Score 8 8 0 Education not specified for Owner Experience: (among ownership team, select one at highest level) Regulated Cannabis Retail Ownership Experience CA 13 13 13 Regulated Cannabis Retail Experience CA (management level or below): Score 10 10 - Other Retail Business Experience Reported, More than 5 years: or 8 8 - Other Retail Business Experience Reported, Less than 5 Years: Score 5 5 - 1.1 Sub-Total:30 20 Construction Cost Estimate: Construction Cost Estimate Provided: Score 8 8 6 4 6 Needs more detail Construction Contingency Factor Included: Score 6 6 0 not included All Labor, Trades, Materials, Supplies and Permits and other Cost Factors Identified: Score 6 6 4 2 4 Some explanation but needs more detail Reference Data Provided for Unit Cost Factors: Score 5 5 3 1 3 States based on other operations costs Operation and Maintenance Cost Estimates: Operation and Maintenance Cost Estimate Provided: Score 8 8 6 4 6 Needs more detail All Labor, Trades, Materials, Supplies, Utilities, and other Cost Factors Identified: Score 6 6 4 2 4 Has some breakdowns but could use more detail Annual Cost Escalators for Operating Costs Provided: Score 6 6 4 2 4 Some costs escalated, with brief discription Reference Data Provided for Unit Cost Factors: Score 5 5 3 1 3 Based on other operations 1.2 Sub-Total:50 30 Proof of Capitalization Specific to one or more Owners: Score 5 5 0 not specific to owner Proof of Capitalization Specific to Business Name/Address: Score 5 5 5 Proof of Capitalization Sufficient to Cover Proforma (3 months) and Construction Costs: Score 15 15 15 Certified Audited Financial Report Provided for one or more Owners: Score 5 5 5 Score one of the following for a maximum 20 points: 1.1 Owner qualifications. Resumes are not to exceed two (2) pages per owner. (30 points possible) 1.2 A budget for construction, operation, and maintenance, compensation of employees, equipment costs, utility cost, and other operation costs.(50 points possible) 1.3 Proof of capitalization in the form of documentation of cash or other liquid assets on hand, Letters of Credit or other equivalent assets which can be verified by the City. (50 Points Possible) Criteria Narrative: Criteria Narrative: Capital source is 100% liquid (cash in owners bank, no debt obligation)20 20 - Capital souce is debt obligation (letter of credit/loan from individual or institution) 10 10 10 Capital consists of non-liquid assets (i.e. real property)8 8 - Capital consists of a mixture of liquid and non-liquid assets 15 15 - 1.3 Sub-Total:50 35 Three Years of Data Provided: Score 10 10 8 6 8 Needs more detail Total Gross Revenue Estimates Provided:3 3 3 Total Gross Revenue by Product Type (flower and manufactured) Identified:3 3 0 not included Total Personnel Costs Provided:5 5 4 3 3 Only listed as compensation line item, needs detail Total Property Rental or Purchase Costs Provided:2 2 2 Total Utilities Costs Provided:2 2 2 Total Cannabis Product Purchase Expense Provided 2 2 2 All Contract Services Identified:2 2 2 Annual Net Revenue Identified:3 3 3 Annual Cost Escalators Identified: 4 4 3 2 2 Some costs shown as escalating, but not enough & no description Annual Estimated Sales Tax Payments to State Provided:2 2 2 Annual Estimated Sale Tax Payments to City of Fresno Provided:5 5 5 Annual Business Tax License and Cannabis Permit Fee Provided:2 2 2 Annual Net Income Provided:5 5 5 Scoring Guidance: full points for realistic figures for all three years. Dock points for severe miscalculations, unrealistic estimates, or providing less than the request three years. 1.4 Sub-Total:50 41 Hours of Operation Provided: Score 5 5 5 6am to 10pm, 7 days a week Hours of Operation Provided for all 7 days of the week: Score 3 3 3 Hours of Operation Provided for Holidays: Score 2 2 0 holidays not specified Opening and Closing Procedures Provided: Score 10 10 8 6 10 Scoring Guidance: full points for describing information in detail. Dock points for leaving information out or not providing enough detail. 1.5 Sub-Total:20 18 1.6.1 Fully describe the day-to-day operations if your applying for a retail permit: i. Describe customer check-in procedures.20 20 15 10 15 Does not describe 9-3310(a)(4) to access retailer after verification of ID. II. Identify location and procedures for receiving deliveries during business hours.10 10 8 6 10 iii. Identify the name of the Point-of-sale system to be used and the number of Point-of-Sale locations.10 10 10 Treez iv. The estimated number of customers to be served per hour/day.20 20 15 10 20 280 per day, 20-25 per hour 1.6 Daily operations. With as much detail as possible, the Business Plan should describe the day-to-day operations which meet industry best practices. This should include at a minimum the following criteria for each permit type in which you are applying for a permit. (100 points possible) 1.4 Pro forma for at least three years of operation. 1.5 Fully describe hours of operation and opening and closing procedures. (20 points possible) Criteria Narrative: Criteria Narrative: Criteria Narrative: v. Describe the proposed product line to be sold and estimate the percentage of sales of flower and manufactured products.20 20 15 10 20 vi. If proposed, describe delivery service procedures, number of vehicles and product security during transportation. (if no delivery service application must state this clearly for full points)20 20 15 10 20 1.6 Sub-Total:100 95 Section 1 Total:300 239 SECTION 2: SOCIAL POLICY AND LOCAL ENTERPRISE 400 Points Possible for Section 2 Description of Commitment to pay a Living Wage provided: Score 10 10 8 6 10 Definition of Living Wage Provided: Score 5 5 4 3 0 did not define Living Wage Defined as Greater than Minimum Wage: Score 5 5 0 did not define 2.1 Sub-Total:20 10 Wages and Salary CCB Entry-Level Hourly Wage Greater than Minimum Wage 5 5 5 entry level wage CCB Entry-Level Annual Salary Greater than Median Household Income ($50,432)5 5 0 Health Care Benefits CCB Offers Medical Coverage to All Employees: Score 5 5 5 CCB Offers Dental Coverage to All Employees: Score 3 3 3 CCB Offers Vision Coverage to All Employees: Score 3 3 3 CCB Offers Health Reimbursement Account for Qualified Medical Expenses: Score 1 1 1 Employee Pays $0 for Employee Medical Premium: Score 3 3 0 premium contribution not specified Employee Pays $0 for Employee Dental Premium: Score 2 2 0 Employee Pays $0 for Employee Vision Premium: Score 2 2 0 Employee Pays less than $500 per month for Family Health Care Coverage (Medical, Dental, Vision): Score 2 2 0 Leave Benefits Number of Paid Vacation/PTO Days Per Year: (10+ days = excep; 6-9 days = Good; 3-5 days Acceptable)5 5 4 3 5 Number of Paid Holidays Per Year: (10 or more paid holidays = excep; 4-10 = Good; 1-3 Acceptable)5 5 4 3 0 Holidays not mentioned Number of days paid time off for Sick/Medical time: (7+ days= Exceptional, 4-6 days = Good, 3 days = acceptable (8 hour day))5 5 4 3 3 Stated as offered but # of hours not specified Retirement Offers employee retirement plan 2 2 0 Not specified Offers company match for employee retirement plan 2 2 2 employee stock option in the company 2.2 Sub-Total:50 27 2.1 Describe whether the Commercial Cannabis Business is committed to offering employees a Living Wage. (20 points possible) Scoring Guidance: https://livingwage.mit.edu/counties/06019 2.2 Briefly describe benefits provided to employees such as health care, vacation, and medical leave, to the degree they are offered as part of employment. (50 points possible) 2.3 Describe compensation to and opportunities for continuing education and employee training.(20 points possible) Criteria Narrative: Criteria Narrative: Criteria Narrative: CCB Provides Tuition Reimbursement for Certificates: Score 3 3 3 Details unspecified but offers tuition assistance CCB Provides Tuition Reimbursement for associate degrees: Score 3 3 3 and scholarships for qualifying employees CCB Provides Tuition Reimbursement for bachelor's degrees: Score 3 3 3 CCB Provides Tuition Reimbursement for master's degrees: Score 3 3 3 CCB Provides Tuition Reimbursement for Specialized Commercial Cannabis Business Operations Training: Score 3 3 3 CCB Offers General Training for Health and Safety, Workplace Environment, Customer Service, etc. 5 5 4 3 5 2.3 Sub-Total:20 20 General Recruitment Plan Provided: Score 10 10 8 6 10 Social Policy Recruitment Plan Provided: Score 10 10 8 6 10 Recruitment Plan Includes Demographic Data for District, City or County: Score 10 10 8 6 0 demographic data not provided Recruitment Plan Includes List of CBOs, Non-Profits and Public-Agency Hiring Partners: Score 10 10 8 6 10 Recruitment Plan Includes Hiring Targets (percentages) by Demographic Groups: Score 10 10 8 6 10 2.4 Sub-Total:50 40 Owners Number of Owners:1 Number of Owners that live within the City of Fresno:0 Number of Owners that live in the County of Fresno:0 Number of Owners that Own a Business in the City of Fresno:0 51%+ ownership interest percent of the Owners live or own a business in the City: Score 80 80 0 51%+ ownership interest percent of the Owners live or own a business in the County: Score 40 40 0 Less than 50 percent equity of the Owners live or own a business in the City (If no owners are local, score zero)20 20 0 Managers Number of Managers (salaried, non-owners) Number of Managers that live in the City of Fresno: Number of Managers that Own a Business in the City of Fresno: 100 percent of the Managers live or own a business in the City: Score 20 20 20 100% local hire commitment 75 to 99 percent of the Managers live or own a business in the City: Score 15 15 - 50 to 74 percent of the Managers live or own a business in the City: Score 10 10 - Less than 50 percent of the Managers live or own a business in the City: Score 5 5 - 2.5 Sub-Total:80 20 2.4 Describe the Commercial Cannabis Business plan to recruit individuals who meet the criteria listed in the Social Policy Section 9-3316 (b) (1) of the Fresno Municipal Code (FMC) and the percentage of local employees it hires. (50 points possible) 2.5 Describe the extent to which the Commercial Cannabis Business will be a locally managed enterprise whose owners and /or managers reside within or own a commercial business within the City of Fresno, for at least one year prior to March 2, 2020.(80 points possible) Criteria Narrative: Data, non-scored. Write response in Evaluation Notes column. IF full points achieved for Ownership category, don't score managers. Section is total of 80 points possible. Criteria Narrative: Criteria Narrative: Data, non-scored. Write response in Evaluation Notes column. Responsibilities Described for All Titles/Positions: Score 20 20 15 10 20 2.6 Sub-Total:20 20 Does CCB have more than five employees: 5 5 5 CCB has signed a peace agreement: Score 5 5 5 2.7 Sub-Total:10 10 Work Force Plan Provided: Score 10 10 8 6 10 Commitment to Local Hire Provided:10 10 8 6 10 Commitment to Offer Apprenticeships Provided:10 10 8 6 10 Commitment paying for continuing education provided 10 10 8 6 10 Description of commitment to paying a living wage provide. (Score same as sec. 2.1)10 10 8 6 10 2.8 Sub-Total:50 50 CCB is willing to serve as Social Equity Business Incubator: Score 100 100 80 60 100 Mentorship and Training: Score yes Equipment Donation: Score Shelf Space: Score yes Legal Assistance: Score yes Finance Services Assistance: Score yes Other Technical Assistance: Score Scoring Guidance: full points for willingness to serve with detailed plan offering at least three aspects mentioned above or of similar benefit. Less points for willingness to serve but vague or unclear commitment. Zero points if there is no clear commitment to serve as Incubator. 2.9 Sub-Total:100 100 Section 2 Total:400 297 SECTION 3: NEIGHBORHOOD COMPATIBILITY PLAN 300 Points Possible for Section 3 Data to inform score on first line of this section. Write response in Evaluation Notes column. 2.8.3. Commitment to pay a living wage to its employees 2.6 Describe the number of employees, title/position and their respected responsibilities.(20 points possible) 2.7 Describe whether the CCB has five (5) or more employees and whether it has signed a labor peace agreement allowing employees to unionize without interference. (10 points possible) 2.8 Provide a workforce plan that includes at a minimum the following provisions: (50 points possible) 2.8.1. Commitment for 30% of employees to be local hires; the business must show that it has either hired or made a good faith effort to hire bona fide residents of Fresno who have not established residency after the submission of an application for employment with the applicant/permittee. 2.8.2. Commitment to offer apprenticeships and/or compensation for continuing education in the field; and Criteria Narrative: Criteria Narrative: Criteria Narrative: Criteria Narrative: 2.9 Describe whether the business is willing to serve as a Social Equity Business Incubator by offering support to local cannabis social equity businesses in the form of mentorship, training, equipment donation, a percentage of shelf space dedicated to Fresno equity business products, legal assistance, financial services assistance, or other technical assistance support.(100 points possible) 3.1 Describe how the CCB will proactively address and respond to complaints related to noise, light, odor, litter, vehicles, and pedestrian traffic.(50 points possible) CCB will document complaints (time of complaint, nature of complaint, resolution of complaint): Score 10 10 8 6 10 CCB will established a dedicated contact person to receive complaints: Score 10 10 10 CCB will establish a dedicated phone number to receive complaints: Score 5 5 5 CCB will establish a dedicated email address to receive complaints: Score 5 5 0 Info not provided CCB will establish a response time standard for returning complaint calls and emails: Score 5 5 5 CCB will schedule or participate in periodic community meetings to engage with residents about the CCB operation: Score 10 10 10 Other measure unique to business (i.e. website complaint form)5 5 5 Scoring Guidance: full points for detailed proactive plan addressing all aspects mentioned. Dock points for leaving out aspect, vagueness, or reactive plans. 3.1 Sub-Total:50 45 CCB will maintain a listserv of community residents to update and information residents of business operations. 10 10 0 Info not provided CCB will schedule or attend periodic community meetings (at least annually) to engage with residents about the CCB operation: Score 10 10 10 CCB will prepare a community outreach and engagement plan: Score 50 50 40 30 50 CCB will issue periodic Newsletters to community providing information about CCB operations 10 10 0 Info not provided CCB will hire residents from the community work at the CCB: Score 20 20 20 Scoring Guidance: full points for detailed proactive plan. Dock points for leaving out aspect, vagueness, or reactive plans. 3.2 Sub-Total:100 80 CCB has identified sensitive receptors to nuisance odors in vicinity of business operations: Score 5 5 5 CCB has prepared a nuisance odor control plan: Score 10 10 8 6 10 Nuisance odor control plan identifies locations where fugitive emissions may exit the premise boundary: Score 5 5 5 Nuisance odor control plan describes specific odor control measures to reduce fugitive emissions exiting the premise boundary: Score 5 5 5 CCB has established an odor reporting system: Score 5 5 5 CCB will install a nuisance odor monitoring system: Score 10 10 10 3.3 Sub-Total:40 40 CCB has identified the potential sources of nuisance odors for the business operation: Score 10 10 8 6 10 Scoring Guidance: full points for detailed proactive plan. Dock points for vagueness or reactive plans. 3.3 Describe odor mitigation practices.(40 points possible) 3.4 Identify potential sources of odor. (10 points possible) Criteria Narrative: Criteria Narrative: Criteria Narrative: 3.2 Describe how the CCB will be managed to avoid becoming a nuisance or having impacts on its neighbors and the surrounding community.(100 points possible) 3.4 Sub-Total:10 10 Nuisance odor control plan describes specific odor control equipment: Score 10 10 8 6 10 Nuisance odor control plan describes specific odor control measures/techniques: Score 10 10 8 6 10 Odor control measures are identified for different nuisance odor sources: Score 10 10 10 3.5 Sub-Total:30 30 Nuisance odor control plan describes the operation, monitoring, and maintenance requirements for odor control measures: Score 10 10 10 Nuisance odor control plan describes the staff training required for system operations, maintenance, repair, and troubleshooting.10 10 10 3.6 Sub-Total:20 20 CCB has identified the sources of waste generated by the business operation: Score 10 10 10 CCB has prepared a source-separation plan to segregate different sources of waste generated by business operations: Score 10 10 10 The source-separation plan identifies policy, procedures, and locations where different sources of waste are to be collected for disposal: Score 10 10 8 6 10 The source-separation plan describes specific measures to control the collection and disposal cannabis waste: Score 10 10 10 The name of licensed cannabis disposal company provided: Score 10 10 10 3.7 Sub-Total:50 50 Section 3 Total:300 275 SECTION 4: SAFETY PLAN 300 Points Possible for Section 4 Safety Plan Prepared by Consultant: Score 10 10 10 Safey Plan Assessed by Consultant: Score (if prepared by, also give points for assessed by)10 10 10 Safety Plan Prepared for CCB Address (specific proposed location): Score 10 10 0 not specific to building Safety Plan includes Site Plan of Premise: Score 10 10 0 no overall site plan Safety Plan includes Building Layout Plan: Score 10 10 10 4.1 Sub-Total:50 30 Written Accident/Incident Procedure Provided: Score 20 20 15 10 0 only fire and medical mentioned 3.5 Describe odor control devices and techniques employed to ensure that odors from cannabis are not detectable beyond the permitted premises. (30 points possible) 3.6 Describe all proposed staff odor training and system maintenance.(20 points possible) Criteria Narrative: Criteria Narrative: Criteria Narrative: Criteria Narrative: 4.1 The Safety Plan shall be prepared and/or assessed by a professional fire prevention and suppression consultant. (50 points possible) 4.2 Describe accident and incident reporting procedures. (50 points possible) Criteria Narrative: 3.7 Describe the waste management plan. (50 points possible) Procedures Address Multiple Accident/Incident Scenarios: Score 10 10 8 6 0 not mentioned Total Number of Scenarios Described: Score 0 Active Shooter Incident Described: Score 10 10 0 not mentioned Robbery Incident Described: Score 10 10 0 not mentioned 4.2 Sub-Total:50 0 Evacuation Plan Provided: Score 20 20 15 10 20 Adequate Number of Evacuation Routes Identified: Score 20 20 15 10 20 Evacuation Route Distance to Public Right of Way: Score 10 10 8 6 0 no overall site plan 4.3 Sub-Total:50 40 Location of Fire Suppression System Elements Identified: Score 10 10 0 only f/e mentioned Type of Fire Suppression System Elements Identified: Score 20 20 15 10 0 not mentioned Location of Fire Extinguishers Identified: Score 10 10 10 Adequate Number of Fire Extinguisher Locations Identified: Score 10 10 8 6 10 4.4 Sub-Total:50 20 Written Procedure for Fire Emergencies Provided: Score 20 20 15 10 20 Written Procedure for Medical Emergencies Provided: Score 20 20 15 10 20 Cardiac Arrest Medical Emergency Described: Score 20 20 15 10 0 not mentioned Gunshot Wound Medical Emergency Described: Score 20 20 15 10 0 not mentioned Other Medical Emergency Conditions Described: Score 20 20 15 10 0 not mentioned 4.5 Sub-Total:100 40 Section 4 Total:300 130 SECTION 5: SECURITY PLAN 300 Points Possible for Section 5 Security Plan Prepared by Consultant: Score 10 10 10 Security Plan Assessed by Consultant(if prepared by, also give points for assessed by): Score 10 10 10 Security Plan Prepared for CCB Address (specific proposed location): Score 10 10 10 Security Plan includes Site Plan of Premise: Score 10 10 10 Security Plan includes Building Layout Plan: Score 10 10 10 5.1 Sub-Total:50 50 Data-write response in Evaluation Notes Column Criteria Narrative: Criteria Narrative: Criteria Narrative: Criteria Narrative: 4.4 Location of fire extinguishers and other fire suppression equipment. (50 points possible) 4.5 Describe procedures and training for all fire and medical emergencies.(100 points possible) 5.1 The Security Plan shall be prepared and/or assessed by a professional security consultant.(50 points possible) 4.3 Describe evacuation routes. (50 points possible) Criteria Narrative: Premises (Security) Diagram Provided: Score 20 20 15 10 20 Diagram is drawn to correct scale: Score 5 5 5 Diagram provides required details for premise: Score 5 5 5 Diagram shows the location of all security cameras: Score 5 5 5 Descriptions of activities to be conducted in each area of the premise 5 5 5 Limited-Access Areas Clearly Marked: Score 5 5 5 Number and Location of All Security Cameras Identified: Score 5 5 5 5.2 Sub-Total:50 50 Intrusion Alarm and Monitoring System Identified: Score 15 15 15 Name and Contact Information for Monitoring Company Provided: Score 5 5 5 Total Points of Entry into Premise Identified: Score 5 5 5 All Points of Entry to be Alarmed Identified:5 5 5 Type of Alarm Identified (motion, infrared, glass break, etc.): Score 10 10 10 Backup Power Supply Identified: Score 10 10 10 5.3 Sub-Total:50 50 Written Cash-Handling Procedure Provided: Score 30 30 20 15 20 Dual-Custody is Practiced for all cash handling: Score 10 10 0 Only mentioned regarding safe counts Video Surveillance Used to Monitor All Cash Handling: Score 20 20 20 Armored Car Service Used for Bank Deposits: Score 10 10 10 All Cash Deposited weekly with Bank: Score 10 10 10 Onsite Vault Provided to Secure Cash Prior to Bank Deposit: Score 20 20 20 5.4 Sub-Total:100 80 CCB will use onsite security guards: Score 10 10 10 5.2 Premises (Security) Diagram. In addition to diagrams submitted for other sections of the application, applicants are expected to submit a premises diagram (or site plan) which, focuses on the proposed security measures and how they relate to the overall business. (Pursuant to CCR Title 16, Division 42, §5006. Premises Diagram). 5.2.1 The diagram shall be accurate, dimensioned and to scale (minimum scale ¼"). The scale may be smaller if the proposed location exceeds more than a 1/2-acre parcel but must not be printed on larger than an 11" x 17" sheet of paper. (Blueprints and engineering site plans are not required at this point of the application process) 5.2.2 The diagram must be drawn to scale and clearly identify property boundaries, entrances, exits, interior partitions, walls, rooms, windows, and doorways. The activity in each room and the location of all cameras must be identified in the diagram. 5.2.4 Limited-access areas, defined as areas in which cannabis goods are stored or held and only accessible to permittees, or its employees or contractors and areas used for video surveillance monitoring and storage devices (Pursuant to CCR Title 16, Division 42, §5000 (m) Limited-Access Area and §5042 Limited-Access Area. 5.2.5 Number and location of all video surveillance cameras. (50 points possible) 5.4 Briefly describe cash handling procedures which covers day to day transactions with customers, vendors armor carrier vehicles and transporting it to the bank.(100 points possible) 5.5 Discuss whether the CCB will utilize the services of on-site security guards. Include in the discussion: (50 points possible) 5.5.1 Number of guards. 5.5.2 Hours guards will be on-site. 5.3 Identify intrusion alarm and monitoring system including the name and contact information for the monitoring company (if the company has been selected).(50 points possible) Criteria Narrative: Criteria Narrative: Criteria Narrative: 5.5.3 Locations at which they will be positioned. 5.5.4 Guards' roles and responsibilities. 5.2.3 Description of cannabis activity that will be conducted in each area of the premise. Commercial cannabis activities that must be identified on the diagram/site plan may include but are not limited to the following if applicable to the business operations; storage areas, batch sampling areas, loading/unloading of shipment areas, packaging and labeling, customer sales areas, training areas, employee break room areas, extractions, infusions, processing, and testing areas. All onsite guards will be licensed and bonded: Score 10 10 0 No mention of being bonded All onsite security guards will be licensed to carry firearms: Score 10 10 10 Onsite security guards will be on duty before CCB opens for business: Score 10 10 10 Onsite security guards will be on duty after CCB closes for business: Score 10 10 10 5.5 Sub-Total:50 40 Section 5 Total:300 270 Section 1: Business Plan Total Points:300 239 Section 2: Social Policy & Local Enterprise Total Points:400 297 Section 3: Neighborhood Compatibility Total Points:300 275 Section 4: Safety Plan Total Points:300 130 Section 5: Security Plan Total Points:300 270 Total Points Achieved:1600 1211 75.69% TOTAL SCORE Criteria Narrative: City of Fresno Commercial Cannabis Business Permit Application EvaluationBusiness Name: Embarc Application # C-20-20 D7 Score 1 Score 2 Score 3 Average% Phase III Points Possible Phase III Points Actual Phase II Points Possible Phase II Points Actual Total Score Section 1: Business Plan 97%92%95%94.67%300 284.00 300.00 239 523 Section 2: Social Policy 97%92%90%93.00%500 465.00 400.00 297 762 Section 3: Neighborhood 97%94%90%93.67%300 281.00 300.00 275 556 Section 4: Safety 97%90%90%92.33%300 277.00 300.00 130 407 Section 5: Security 97%92%95%94.67%300 284.00 300.00 270 554 Section 6: Location 97%88%95%93.33%200 186.67 -0 186.67 Section 7: Community Benefits 97%92%98%95.67%500 478.33 -0 478.33 Total Score (points)2400 2256 1600.00 1211 3467 Total %86.68% ________________ ________________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved.Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 1of 18 STANDARD INDUSTRIAL/COMMERCIAL MULTI­TENANT LEASE ­ NET 1. BasicProvisions ("BasicProvisions"). 1.1 ParƟes.This Lease("Lease"), dated forreference purposes only 12/2/2020 ,ismade byand between R&R Real Properties, Inc ("Lessor")and Responsible and Compliant Retail Blackstone, LLC, dba Embarc Fresno ("Lessee"), (collecƟvelythe "ParƟes",or individually a"Party"). 1.2(a)Premises:That certain real property,including allimprovements therein or to be provided byLessor under theterms ofthis Lease,commonly known as (street address, unit/suite, city,state):4592 N Blackstone Ave #103, Fresno, CA 93726 ("Premises"). The Premisesare located in the County of Fresno ,and aregenerally described as (describe brieflythe nature of thePremisesandthe"Project"):An approx 4,714sf retail pad building, with 3,224sf of leased premise that is the subject of this lease agreement . In addiƟon to Lessee'srightsto useand occupythePremises ashereinaŌer specified,Lessee shallhave non­exclusive rightsto any uƟlityraceways ofthe building containing the Premises("Building") andto theCommonAreas (asdefined inParagraph2.7 below),but shallnothave any rights to the roof,or exterior walls oftheBuilding or to anyother buildings in the Project. ThePremises,the Building,the Common Areas,the land upon which they arelocated, along with all other buildings and improvements thereon, are herein collecƟvely referred toas the"Project." (Seealso Paragraph2) 1.2(b)Parking:4.31/1000sf of unreserved vehicle parking spaces with six (6)dedicated parking stalls for mobil orders and curbside pick up..(SeealsoParagraph2.6) 1.3 Term:Five (5)yearsand zero (0)months("Original Term")commencing upon waiver of licensing contingency outlined in paragraph 51 in the Addendum ("CommencementDate") andending Five (5) years later.("ExpiraƟon Date"). (See alsoParagraph3) 1.4 Early Possession:Ifthe Premisesareavailable Lesseemay have non­exclusive possession of the Premisescommencing n/a ("EarlyPossession Date"). (Seealso Paragraphs 3.2and 3.3) 1.5 Base Rent:per month("Base Rent"), payable on the 1st day ofeach monthcommencing See addendum paragraph #52 . (See alsoParagraph 4) Ifthis boxis checked, there are provisions in this Lease fortheBase Rentto beadjusted. SeeParagraph 50 . 1.6 Lessee's Shareof CommonArea OperaƟng Expenses:Sixty Eight and Four Tenths percent (68.4 %)("Lessee'sShare"). In the event that thesizeof thePremises and/or the Project aremodified during the termofthis Lease,Lessor shallrecalculate Lessee's Shareto reflect such modificaƟon. 1.7 Base Rent and Other Monies Paid Upon ExecuƟon: (a)Base Rent:for the period First Month Rent . (b)CommonArea OperaƟng Expenses:ThecurrentesƟmatefortheperiod First Month NNN is . (c)SecurityDeposit:("Security Deposit"). (Seealso Paragraph5) (d)Other:for One time lease contingency fee (See paragraph #51). (e)Total DueUponExecuƟon ofthis Lease:. 1.8 Agreed Use:Legal Cannabis Retail and Delivery . (SeealsoParagraph 6) 1.9 Insuring Party.Lessoris the"InsuringParty". (See alsoParagraph8) 1.10 Real Estate Brokers.(Seealso Paragraph15and 25) (a)RepresentaƟon:Each Party acknowledges receiving aDisclosureRegarding Real Estate Agency RelaƟonship,confirms and consents to the following agencyrelaƟonships inthis Leasewiththe followingreal estatebrokers ("Broker(s)")and/or their agents("Agent(s)"): Lessor’s Brokerage Firm Colliers Tingey International, Inc.License No.00452468 Isthe brokerof(check one): the Lessor; or both theLessee and Lessor (dual agent). Lessor’sAgent Zack Kaufman LicenseNo.01902869 is(check one): theLessor’sAgent (salespersonor brokerassociate);or both the Lessee’s Agent and theLessor’s Agent (dual agent). Lessee’s Brokerage Firm Colliers Tingey International, Inc dba Colliers International License No. 00452468 Isthe broker of (checkone): theLessee; or both theLessee and Lessor (dual agent). Lessee’sAgent Zack Kaufman LicenseNo.01902869 is (check one): the Lessee’s Agent(salesperson orbroker associate); or both the Lessee’sAgent and the Lessor’s Agent(dual agent). (b)Payment to Brokers.Upon execuƟon and delivery of this Leaseby both ParƟes,Lessor shall payto the Brokers the brokerage fee agreed to in a separatewriƩen agreement(or ifthere is nosuch agreement,the sumof or 5 % of the total Base Rent for years 1-5, excluding free rent, and 2.5% total base rent for the first renewal option,1/2due upon tenant being awarded their license tooperate from the City of Fresno andthe remaining 1/2 due within one hundred eighty days following rent commencement ) for the brokerage services rendered by the Brokers. 1.11 Guarantor.TheobligaƟons ofthe Lesseeunder this Leaseare to beguaranteed by Consolidated Commercial Holdings, LLC, a California Limited liability Company ("Guarantor"). (Seealso Paragraph37) DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 2of 18 1.12 AƩachments.AƩached hereto are the following,allof which consƟtute apart of this Lease: anAddendum consisƟng of Paragraphs 50 through 56 ; asite plandepicƟng thePremises; asite plandepicƟng theProject; acurrent setof theRulesand RegulaƟons for theProject; acurrent setof theRulesand RegulaƟons adopted bythe owners' associaƟon; aWorkLeƩer; other(specify):Paragraph: 57 Option to Extend, Guaranty of Lease, Rent Commencement Date Memo (waiting for input from Phyllis, Paragraph 58: Arbitration Agreement, Representation Confirmation, CTI Disclosures . 2.Premises. 2.1 Leƫng. Lessor herebyleases toLessee,and Lesseehereby leasesfromLessor, the Premises, forthe term, atthe rental,and uponallof theterms, covenants and condiƟons set forth in this Lease. Whilethe approximate square footage ofthe Premises mayhave been used in themarkeƟng ofthe Premises for purposes of comparison, the BaseRentstated herein is NOTƟed to square footage andis not subjectto adjustment should the actualsize be determined tobe different.NOTE:Lesseeisadvised toverify theactual sizeprior to execuƟng this Lease. 2.2 CondiƟon. Lessor shalldeliver thatporƟonof the Premises contained within the Building ("Unit") toLesseebroom cleanand free of debrisonthe Commencement Date or the EarlyPossession Date,whichever first occurs ("Start Date"),and,so long as therequired service contracts described in Paragraph 7.1(b) beloware obtained by Lesseeandin effectwithin thirtydays followingtheStart Date,warrants thatthe exisƟng electrical,plumbing, firesprinkler, lighƟng, heaƟng, venƟlaƟng and air condiƟoning systems ("HVAC"),loading doors,sump pumps,if any,and all other such elements in the Unit,other than thoseconstructed byLessee, shall be ingood operaƟngcondiƟon on saiddate, thatthe structural elementsof theroof, bearingwallsand foundaƟon of theUnitshall befree ofmaterial defects, and that theUnit does not contain hazardous levels ofany mold or fungi defined as toxic under applicable stateor federallaw. Ifa non­compliancewith such warrantyexists asof theStartDate, orif oneof suchsystems or elementsshould malfuncƟon orfail withinthe appropriate warrantyperiod, Lessorshall, asLessor's soleobligaƟon with respect to such maƩer,except as otherwiseprovided in this Lease,promptly aŌer receipt ofwriƩen noƟcefrom Lesseeseƫng forth with specificitythe nature and extentofsuch non­compliance, malfuncƟon orfailure, recƟfy sameat Lessor'sexpense. Thewarranty periods shall beasfollows: (i)6 months as to the HVAC systems,and (ii)30 days as to theremaining systems and other elements of theUnit. IfLessee does not giveLessor the required noƟce within the appropriate warrantyperiod, correcƟon ofany suchnon­compliance, malfuncƟon or failureshallbe theobligaƟon ofLesseeat Lessee'ssole cost and expense (except for therepairs to thefire sprinkler systems,roof,foundaƟons,and/or bearing walls ­seeParagraph 7). Lessor also warrants,that unless otherwise specified in wriƟng,Lessor is unaware of(i)any recorded NoƟces ofDefault affecƟng the Premise; (ii)any delinquent amounts due under any loansecured by thePremises; and (iii)any bankruptcy proceeding affecƟng thePremises. 2.3 Compliance. Lessor warrantsthat to the best ofits knowledge the improvements onthe Premises complywith the building codes,applicable laws, covenants or restricƟons of record,regulaƟons,and ordinances ("Applicable Requirements")that werein effect at the Ɵmethat each improvement,or porƟon thereof, was constructed. Saidwarrantydoes not apply tothe usetowhich Lesseewill putthePremises, modificaƟons which mayberequired bythe Americans with DisabiliƟes Act or any similar laws as aresult ofLessee's use(seeParagraph 49),or to anyAlteraƟons or UƟlity InstallaƟons (as defined in Paragraph 7.3(a))made or to bemade byLessee.NOTE:Lessee isresponsible fordetermining whetherornot theApplicable Requirements,andespecially thezoning areappropriatefor Lessee'sintended use,and acknowledgesthat past usesof thePremises may nolonger beallowed.Ifthe Premises do not comply with said warranty,Lessor shall, exceptas otherwise provided, promptlyaŌer receipt ofwriƩen noƟce from Lesseeseƫng forth withspecificity the nature and extentof such non­compliance,recƟfy the same at Lessor's expense. If Lesseedoes not give Lessor wriƩen noƟce ofa non­compliance withthis warranty within 6months following theStart Date, correcƟon of thatnon­compliance shallbethe obligaƟonof Lesseeat Lessee'ssolecost andexpense. Ifthe Applicable Requirements arehereaŌer changed so as to require during theterm ofthis Lease theconstrucƟon ofan addiƟon to or an alteraƟon oftheUnit,Premises and/or Building,theremediaƟon ofany Hazardous Substance, or thereinforcement orotherphysical modificaƟon of theUnit,Premisesand/or Building ("CapitalExpenditure"), LessorandLessee shallallocate thecost ofsuch workas follows: (a) Subject toParagraph 2.3(c)below,if suchCapital Expenditures are required as a result of thespecificand unique use ofthePremises byLessee as compared with uses by tenants in general,Lesseeshall befully responsible for the cost thereof,provided,however,that ifsuch Capital Expenditure is required during thelast 2years ofthisLease andthe costthereof exceeds6months' BaseRent, Lesseemayinstead terminate this LeaseunlessLessor noƟfiesLessee, in wriƟng, within 10 days aŌer receipt ofLessee's terminaƟon noƟce that Lessor has elected to pay the difference between the actual cost thereofand the amount equal to 6 months'Base Rent. IfLesseeelects terminaƟon, Lessee shallimmediately ceasetheuse ofthe Premiseswhichrequires suchCapital Expenditure and deliver toLessor wriƩen noƟce specifying aterminaƟon date at least 90 days thereaŌer. Such terminaƟon date shall,however,in no event be earlier than the last day that Lessee could legally uƟlizethe Premises without commencing such Capital Expenditure. (b) Ifsuch Capital Expenditure is not the result of thespecificand unique use ofthe Premises byLessee (such as,governmentally mandated seismic modificaƟons), then Lessorshall payforsuch CapitalExpenditure andLessee shall onlybe obligatedto pay,eachmonth during the remainder ofthe termofthisLease or any extension thereof,on thedate that on which the BaseRent is due,an amount equalto 1/144th of theporƟon of such costs reasonably aƩributable to the Premises. Lesseeshall payInterest on the balance but may prepay itsobligaƟon atany Ɵme. If, however, such Capital Expenditure is required during the last 2years ofthis Leaseor ifLessor reasonably determines that it is not economically feasible to pay its sharethereof,Lessor shall have theopƟon to terminate this Lease upon 90days priorwriƩen noƟcetoLessee unless Lessee noƟfiesLessor, inwriƟng,within 10days aŌer receiptof Lessor'sterminaƟon noƟcethatLessee will pay forsuch CapitalExpenditure. If Lessor does not elect to terminate,and fails to tender its share ofanysuch Capital Expenditure,Lesseemayadvance such funds and deduct same,with Interest,from RentunƟlLessor's share of suchcosts have beenfully paid. IfLesseeis unable to financeLessor's share, orif thebalance of theRent due andpayable forthe remainder ofthis Leaseis not sufficient tofully reimburse Lesseeon anoffsetbasis, Lesseeshall have theright toterminate thisLease upon 30 days wriƩen noƟce to Lessor. (c) Notwithstanding the above, the provisions concerning Capital Expenditures are intended to applyonly to non­voluntary, unexpected, and new Applicable Requirements. If theCapital Expenditures areinstead triggered by Lesseeas aresult of an actualor proposed change in use,change in intensity ofuse,or modificaƟonto thePremises then, andin thatevent, Lesseeshall either:(i)immediately ceasesuch changed useor intensityof useand/ortake such other steps as maybe necessaryto eliminatetherequirement for such Capital Expenditure,or (ii)complete such Capital Expenditure at its own expense. Lesseeshall not have any rightto terminate this Lease. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 3of 18 2.4 Acknowledgements.Lesseeacknowledges that: (a)it has been given an opportunity to inspect and measure the Premises,(b) it has been advised by Lessorand/or Brokersto saƟsfy itselfwith respectto thesize andcondiƟon of thePremises (including but not limitedto the electrical,HVAC and fire sprinkler systems,security,environmental aspects,and compliance with Applicable Requirements and theAmericans with DisabiliƟes Act),and their suitability for Lessee's intended use, (c)Lessee hasmadesuch invesƟgaƟonas itdeems necessary with reference to such maƩers and assumes all responsibility therefor as the samerelate to its occupancy of the Premises,(d) it is not relying on anyrepresentaƟon as to thesizeofthePremises madebyBrokers or Lessor,(e)the square footage of the Premiseswas notmaterial toLessee'sdecision tolease thePremises andpaythe Rentstated herein, and(f) neither Lessor, Lessor'sagents,nor Brokershave made anyoral or wriƩen representaƟons or warranƟes with respect to said maƩers other than as set forth in this Lease. In addiƟon,Lessor acknowledges that: (i)Brokers have made no representaƟons, promises orwarranƟes concerning Lessee's abilityto honor theLease orsuitability tooccupy the Premises,and (ii)it is Lessor'ssole responsibility to invesƟgatethe financial capability and/or suitabilityof allproposed tenants. 2.5 Lessee asPrior Owner/Occupant. The warranƟesmade byLessor inParagraph 2 shall be ofno force oreffect ifimmediately priortothe StartDate Lessee was the owner or occupant ofthe Premises. In such event,Lesseeshall beresponsible for anynecessary correcƟve work. 2.6 Vehicle Parking. Lesseeshall beenƟtledto use the number ofParking Spacesspecified inParagraph1.2(b) onthose porƟonsof theCommonAreas designated from Ɵmeto ƟmebyLessor for parking. Lessee shall not use more parking spaces than said number. Said parking spaces shallbe used for parking by vehicles no largerthan full­sizepassenger automobiles orpick­up trucks,herein called"PermiƩedSize Vehicles." Lessormayregulate theloading andunloading of vehicles by adopƟng Rules and RegulaƟons as provided in Paragraph 2.9. No vehicles other than PermiƩed SizeVehicles maybe parked in the Common Area without the prior wriƩenpermission ofLessor. InaddiƟon: (a) Lessee shallnot permit or allow anyvehicles that belong to or are controlled by Lesseeor Lessee's employees,suppliers,shippers,customers, contractorsor inviteesto beloaded,unloaded, orparked inareas otherthanthose designated by Lessorforsuch acƟviƟes. (b) Lessee shall not service or store any vehicles in theCommon Areas. (c) IfLessee permitsor allowsanyof theprohibited acƟviƟesdescribed in thisParagraph 2.6,then Lessorshallhave theright, withoutnoƟce,in addiƟon to such other rights and remedies that it may have,to remove or tow awaythe vehicle involved and charge the cost to Lessee,which cost shallbe immediately payable upon demand by Lessor. 2.7 Common Areas­ DefiniƟon.Theterm"Common Areas"is defined as all areas and faciliƟes outsidethe Premises and within the exterior boundary line of theProject andinterior uƟlityracewaysand installaƟons within theUnit thatareprovided and designated bythe Lessor fromƟme toƟmefor thegeneral non­exclusive use ofLessor,Lesseeand other tenants of theProject and their respecƟve employees,suppliers,shippers,customers,contractors and invitees,including parking areas,loading and unloading areas,trash areas,roofs,roadways,walkways,driveways and landscaped areas. 2.8 Common Areas­ Lessee'sRights. Lessorgrants to Lessee, for the benefit ofLessee and itsemployees, suppliers, shippers, contractors, customers and invitees,during the term ofthis Lease,thenon­exclusive right to use,in common with others enƟtled to such use,the Common Areas as theyexist from Ɵme to Ɵme, subjectto anyrights, powers,andprivileges reservedby Lessorunder the termshereof orunder thetermsof anyrules andregulaƟons or restricƟons governing the useof theProject. Under no circumstances shall theright herein granted to use the Common Areas be deemed to includetheright to store anyproperty,temporarily orpermanently, inthe CommonAreas. Anysuch storageshall bepermiƩedonly bythe priorwriƩenconsent ofLessor orLessor'sdesignated agent,which consent maybe revoked at anyƟme. In the event that anyunauthorized storage shall occur,then Lessor shall have the right,without noƟce,in addiƟon to such other rights andremedies thatit mayhave,to removethe propertyand chargethecost toLessee, which costshall be immediately payable upon demand byLessor. 2.9 Common Areas­ Rulesand RegulaƟons.Lessor or such other person(s) as Lessor may appoint shallhave theexclusive controland management ofthe CommonAreas andshall have theright, from Ɵme toƟme, toestablish, modify, amendand enforcereasonablerules andregulaƟons ("RulesandRegulaƟons") for themanagement,safety,care,and cleanliness of the grounds,theparking and unloading of vehicles and the preservaƟon of good order,as wellas for the convenience ofother occupants or tenants ofthe Building and theProject and theirinvitees. Lessee agreestoabide byand conformtoall suchRules andRegulaƟons,andshall use its best efforts to cause its employees,suppliers,shippers,customers,contractors and invitees to so abide and conform. Lessor shallnot be responsible to Lessee forthe non­compliance with saidRules and RegulaƟons by othertenants oftheProject. 2.10 Common Areas­Changes. Lessor shallhave the right,in Lessor's solediscreƟon,from Ɵme to Ɵme: (a) To makechanges totheCommon Areas,including, without limitaƟon, changesinthe locaƟon,size, shapeandnumber ofdriveways, entrances, parking spaces,parking areas,loading and unloading areas,ingress,egress,direcƟon oftraffic,landscaped areas,walkways and uƟlityraceways; (b) Toclose temporarilyany oftheCommon Areasfor maintenancepurposes so long as reasonable access tothePremises remains available; (c) To designate other land outsidetheboundaries ofthe Project to be apart ofthe Common Areas; (d) Toadd addiƟonal buildings and improvements to theCommon Areas; (e) To usetheCommon Areas while engaged in making addiƟonal improvements,repairs or alteraƟonsto the Project,or anyporƟon thereof; and (f) To doandperform suchother actsandmake suchother changes in,to orwith respectto theCommonAreas andProject asLessormay, inthe exercise of sound business judgment,deem to beappropriate. 3. Term. 3.1 Ter m. The Commencement Date,ExpiraƟon Dateand OriginalTerm ofthis Lease areas specified in Paragraph 1.3. 3.2 Early Possession. Any provisionherein granƟng LesseeEarly Possessionofthe Premisesis subjecttoand condiƟoned upon thePremises being available for such possession prior to theCommencement Date. Anygrant ofEarlyPossession onlyconveys anon­exclusiveright to occupy thePremises. IfLessee totally or parƟallyoccupies thePremises prior tothe CommencementDate, theobligaƟon topayBase Rentshall beabatedfor the period ofsuchEarly Possession.Allother terms of this Lease (including but not limited to theobligaƟons to payLessee's Shareof Common AreaOperaƟng Expenses,Real PropertyTaxes and insurance premiums and to maintain thePremises) shall bein effectduring such period. Anysuch EarlyPossessionshall notaffect theExpiraƟonDate. 3.3 Delay In Possession.Lessor agrees to use its best commerciallyreasonable efforts to deliver possession ofthe Premises to Lesseeby theCommencement Date. If,despite saidefforts,Lessor isunable todeliver possessionbysuch date,Lessor shallnotbe subjectto anyliabilitytherefor, norshall suchfailure affectthe validityof this Lease or change the ExpiraƟon Date. Lessee shallnot,however,beobligated to pay Rent or perform its other obligaƟons unƟlLessor delivers possessionof thePremises andanyperiod ofrent abatementthat Lesseewouldotherwise have enjoyed shallrunfrom thedate ofdelivery of possession and conƟnue for aperiod equalto what Lesseewould otherwise have enjoyed under the terms hereof,but minus any days of delaycaused by theacts or omissions of Lessee. Ifpossession isnotdelivered within60 daysaŌer theCommencementDate, asthe samemay be extended under the terms of anyWork LeƩerexecuted by ParƟes,Lessee may,at its opƟon,by noƟce in wriƟng within 10 days aŌer theend ofsuch 60 dayperiod,cancel this Lease,in which event the ParƟes shallbe discharged from allobligaƟons hereunder. If such wriƩen noƟceis not receivedby Lessorwithin said10day period, Lessee's righttocancel shallterminate. If possession of thePremises is not delivered within 120 days aŌer theCommencement Date,this Lease shallterminate unless other agreements arereached between Lessorand Lessee,in wriƟng. 3.4 Lessee Compliance. Lessor shall not be required to tender possession ofthe Premises to LesseeunƟlLessee complies with its obligaƟon to provide evidence of insurance (Paragraph 8.5). Pending deliveryof such evidence, Lesseeshall be requiredto perform allof its obligaƟons under this Lease from and aŌer the DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 4of 18 Start Date,including the payment ofRent,notwithstanding Lessor's elecƟon to withhold possessionpending receipt of such evidence of insurance. Further,ifLessee isrequired to perform anyother condiƟons priorto orconcurrent withthe Start Date, the StartDateshall occurbut Lessormayelect towithhold possessionunƟl such condiƟons are saƟsfied. 4. Rent. 4.1.Rent Defined.AllmonetaryobligaƟons of Lesseeto Lessor under the terms of this Lease(except for the SecurityDeposit)are deemed to be rent ("Rent"). 4.2 Common AreaOperaƟng Expenses. Lesseeshallpay toLessor during theterm hereof, in addiƟon to the BaseRent, Lessee's Share (asspecified in Paragraph 1.6) ofall Common AreaOperaƟng Expenses,as hereinaŌer defined,during each calendar year of thetermof this Lease,in accordance with thefollowing provisions: (a) "Common AreaOperaƟng Expenses"aredefined,for purposes of this Lease,as allcosts relaƟng to the ownership and operaƟon ofthe Project, including, but not limited to,the following: (i) TheoperaƟon,repair and maintenance,in neat,clean,good order and condiƟon ,and ifnecessary thereplacement,of thefollowing: (aa) The CommonAreas andCommonArea improvements,including parkingareas,loading andunloading areas,trashareas, roadways, parkways,walkways,driveways,landscaped areas,bumpers,irrigaƟon systems,Common ArealighƟng faciliƟes,fences and gates,elevators,roofs,exterior walls ofthe buildings, building systems and roofdrainage systems. (bb) Exterior signs and anytenant directories. (cc) Anyfiresprinkler systems. (dd) All other areas and improvements that arewithin theexterior boundaries ofthe Project but outside ofthe Premises and/or anyother spaceoccupied bya tenant. (ii) Thecost of water,gas,electricityand telephone to service theCommon Areas and any uƟliƟes not separately metered. (iii) The costoftrash disposal, pest control services,property management,security services,owners' associaƟonduesand fees,the costtorepaint the exterior ofany structures and the cost of anyenvironmental inspecƟons. (iv) Reserves setasidefor maintenance, repairand/or replacementofCommon Areaimprovements andequipment. (v) RealProperty Taxes (as defined in Paragraph 10). (vi) The costofthe premiums for theinsurance maintained byLessor pursuant to Paragraph 8. (vii) AnydeducƟble porƟon ofan insured loss concerning the Building or the Common Areas. (viii) Auditors',accountants'and aƩorneys'fees and costs related to theoperaƟon,maintenance,repair and replacement oftheProject. (ix) The costof anycapital improvementtothe Building or theProjectnot covered under the provisions of Paragraph 2.3 provided; however, that Lessor shall allocate the cost ofany such capital improvement over a12 year period and Lesseeshallnot be required to paymore than Lessee's Shareof 1/144th of the cost ofsuch capitalimprovementin anygiven month. Lesseeshallpay Intereston theunamorƟzedbalance butmay prepay itsobligaƟon atany Ɵme. (x) Thecost ofany other services to be provided byLessor that are stated elsewhere in this Leaseto bea Common AreaOperaƟng Expense. (b) AnyCommon Area OperaƟng Expenses andReal PropertyTaxes that arespecifically aƩributable to theUnit, theBuilding or toany otherbuilding in the Project or to theoperaƟon,repair and maintenance thereof,shall beallocated enƟrely to such Unit,Building,or other building. However,any Common Area OperaƟngExpenses andReal Property Taxesthat arenot specificallyaƩributable to theBuilding orto anyotherbuilding orto the operaƟon, repair and maintenance thereof,shall beequitably allocated by Lessor to all buildings in theProject. (c) Theinclusion ofthe improvements,faciliƟesand servicesset forthin Subparagraph 4.2(a)shall notbe deemedtoimpose anobligaƟon upon Lessor to either have said improvements or faciliƟes or to provide those services unless theProject alreadyhas thesame,Lessor already provides theservices,or Lessor has agreed elsewhere inthis Leaseto provide the same orsome ofthem. (d) Lessee's Share ofCommon AreaOperaƟng Expenses is payable monthlyon the sameday as the BaseRent is duehereunder. Theamount ofsuch payments shall bebased onLessor'sesƟmate ofthe annual Common AreaOperaƟng Expenses. Within 60days aŌer wriƩenrequest (but notmore than once each year)Lessor shalldeliver to Lesseea reasonablydetailed statement showing Lessee's Shareof theactual Common AreaOperaƟng Expenses for thepreceding year. If Lessee'spayments during such yearexceedLessee's Share, Lessor shallcredit theamountof such over­payment against Lessee's future payments. If Lessee's payments during such year wereless than Lessee's Share,Lesseeshall pay to Lessor theamount ofthedeficiency within 10 days aŌer delivery byLessor to Lessee of the statement. (e) Common AreaOperaƟng Expenses shallnot include any expenses paid by anytenant directly to third parƟes,or as to which Lessor is otherwise reimbursed by anythird party,othertenant, orinsurance proceeds. 4.3 Payment. Lessee shall cause payment ofRent to be received byLessor in lawful money ofthe United States,without offset or deducƟon (except as specificallypermiƩed inthis Lease),onor beforethe dayon whichitis due.Allmonetary amounts shallbe rounded tothe nearestwhole dollar. Intheevent thatany invoice prepared by Lessor is inaccurate such inaccuracyshall not consƟtute awaiver and Lesseeshall beobligated to pay the amount set forth in this Lease. Rent for anyperiod during the termhereof which isfor lessthan onefull calendar monthshall be prorated based upon the actual number of days of said month. Paymentof Rent shall bemade to Lessor at its address stated herein or to such other persons or place as LessormayfromƟmeto Ɵmedesignate in wriƟng. Acceptanceof a paymentwhich isless than the amount thendue shall not be awaiver ofLessor's rightstothe balanceof suchRent,regardless ofLessor's endorsementofanycheck so staƟng. In theevent that anycheck,draŌ,or other instrument of payment given byLesseeto Lessor is dishonored for any reason,Lessee agrees to pay to Lessor the sum of$25 inaddiƟon to anyLate Charge and Lessor,atits opƟon,may require allfuture Rentbe paidbycashier's check. Paymentswill beappliedfirsttoaccrued latecharges and aƩorney's fees,second to accrued interest,then to BaseRent and Common Area OperaƟng Expenses,and anyremaining amount to any other outstanding charges orcosts. 5.Security Deposit.Lesseeshall deposit with Lessor upon execuƟon hereof theSecurity Deposit assecurity for Lessee's faithful performance of its obligaƟons under this Lease. IfLesseefails to pay Rent,or otherwise Defaultsunder thisLease, Lessormayuse, applyor retainallor anyporƟon ofsaid Security Deposit for the payment of anyamount alreadydue Lessor,for Rents which will beduein thefuture,and/or to reimburse or compensate Lessor for anyliability,expense,loss or damage which Lessormay sufferorincur byreason thereof. IfLessoruses orapplies allorany porƟonof theSecurityDeposit, Lesseeshall within10 daysaŌer wriƩen request therefor deposit monies with Lessor sufficient to restore said SecurityDeposit to thefull amount required by this Lease. Ifthe BaseRent increases during the term of this Lease, Lessee shall, upon wriƩen request from Lessor,deposit addiƟonal monies withLessorso thatthe total amountof theSecurity Deposit shallat allƟmes bear thesame proporƟon to theincreased BaseRent as theiniƟal SecurityDeposit bore to the iniƟalBaseRent. Should theAgreed Usebeamended toaccommodate amaterial change inthe business of Lesseeor toaccommodate a sublessee or assignee,Lessorshall have the righttoincrease theSecurity Deposit to the extent necessary,in Lessor's reasonable judgment,to account for anyincreased wear and tear that thePremises maysuffer as aresult thereof. Ifa change in controlof Lesseeoccurs during this Lease andfollowing suchchange thefinancialcondiƟon ofLessee is,inLessor's reasonable judgment, significantly reduced, Lessee shalldeposit such addiƟonal monies with Lessor as shall besufficient to cause the SecurityDeposit to be at acommercially reasonable levelbased on such change in DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 5of 18 financialcondiƟon. Lessor shallnot be required to keepthe SecurityDeposit separate fromits generalaccounts. Within 90 days aŌer the expiraƟon or terminaƟon of thisLease, Lessorshall returnthatporƟon ofthe SecurityDeposit notusedor applied by Lessor. Lessor shall upon wriƩenrequest provide Lesseewith anaccounƟng showing how that porƟon oftheSecurity Deposit that was not returned was applied. No part ofthe SecurityDeposit shallbeconsidered to be held in trust,to bear interest or to be prepayment forany monies to be paid byLesseeunder this Lease. THESECURITY DEPOSITSHALL NOTBEUSED BYLESSEE INLIEU OFPAYMENTOF THELAST MONTH'SRENT. 6. Use. 6.1 Use. Lessee shalluse and occupythe Premises only for theAgreed Use,or anyother legal usewhich is reasonably comparable thereto,and for no other purpose. Lesseeshall notuseor permitthe useof thePremisesin amanner thatisunlawful, creates damage, waste ora nuisance, or thatdisturbs occupantsofor causes damage to neighboring premises or properƟes. Other than guide,signaland seeing eyedogs,Lessee shallnot keep or allow in the Premises any pets,animals, birds, fish, orrepƟles. Lessorshall notunreasonably withhold or delay itsconsent toany wriƩenrequest for amodificaƟon oftheAgreed Use,so longas thesamewill not impair thestructural integrityofthe Building or themechanical or electricalsystems therein,and/or is not significantly more burdensome to theProject. If Lessor electsto withhold consent, Lessorshallwithin 7days aŌersuch request givewriƩen noƟficaƟon of same,whichnoƟce shallinclude anexplanaƟonof Lessor's objecƟons to thechange in theAgreed Use. 6.2 Hazardous Substances. (a)Reportable UsesRequire Consent.Theterm"Hazardous Substance"as used in this Leaseshall mean anyproduct,substance,or waste whose presence, use, manufacture, disposal, transportaƟon, orrelease, eitherbyitselforincombinaƟonwithothermaterialsexpectedtobeonthePremises,iseither: (i) potenƟally injurious to the public health,safety or welfare,theenvironment or thePremises,(ii)regulated or monitored by anygovernmental authority,or (iii) abasis forpotenƟal liabilityof Lessortoany governmental agency orthird party under any applicable statute orcommon law theory. Hazardous Substances shall include, but not be limited to,hydrocarbons,petroleum,gasoline,and/or crude oilor anyproducts,by­products or fracƟons thereof. Lessee shallnot engagein any acƟvityin or onthe Premiseswhich consƟtutes aReportable Useof Hazardous Substances without the express priorwriƩen consentofLessor and Ɵmely compliance (atLessee's expense) with allApplicable Requirements. "Reportable Use"shallmean (i) theinstallaƟon or useofanyaboveor below ground storage tank,(ii) thegeneraƟon, possession, storage, use,transportaƟon, ordisposalof aHazardous Substance that requires apermit from, or withrespectto whicha report, noƟce,registraƟon or business plan is required to be filed with,any governmental authority,and/or (iii)the presence at thePremises of aHazardous Substance with respect to which any Applicable Requirements requires that anoƟce be givento persons entering oroccupying the Premisesor neighboring properƟes. Notwithstanding the foregoing, Lesseemay useany ordinary and customary materials reasonably required to be used in thenormal course of the Agreed Use,ordinary officesupplies (copier toner, liquid paper,glue,etc.) and common household cleaning materials,so long as such use is in compliancewith all Applicable Requirements,is not aReportableUse,and does not expose the Premises orneighboring property to anymeaningful riskofcontaminaƟon ordamage orexpose Lessor toany liabilitytherefor. InaddiƟon, Lessor may condiƟon its consent to any Reportable Use upon receiving such addiƟonal assurances as Lessor reasonably deems necessary to protect itself,thepublic, the Premises and/or the environmentagainstdamage, contaminaƟon, injury and/or liability, including, but not limited to, theinstallaƟon (and removal on orbefore LeaseexpiraƟon or terminaƟon) of protecƟve modificaƟons (such as concrete encasements) and/orincreasing the SecurityDeposit. (b)Dutyto InformLessor. IfLessee knows,or hasreasonable cause tobelieve, that a Hazardous Substance has come to be located in, on, under or about the Premises,other than as previously consented to byLessor,Lesseeshallimmediately givewriƩen noƟceofsuch fact to Lessor,and provide Lessor with a copyof anyreport, noƟce,claimor otherdocumentaƟon whichit hasconcerning the presence of such Hazardous Substance. (c)LesseeRemediaƟon. Lessee shall not cause or permit anyHazardous Substance to be spilled or released in,on,under,or about thePremises (including through theplumbing orsanitary sewer system) and shall promptly, atLessee's expense, complywith allApplicable Requirements and take allinvesƟgatory and/or remedial acƟon reasonably recommended,whether or not formally ordered or required,for the cleanup of anycontaminaƟon of,and for themaintenance, security and/or monitoring of thePremises or neighboring properƟes, thatwas caused ormaterially contributed to byLessee,or pertaining to orinvolvingany Hazardous Substance brought onto thePremises during theterm ofthis Lease,byor for Lessee,or anythird party. (d)LesseeIndemnificaƟon. Lessee shallindemnify, defend and hold Lessor, itsagents, employees,lenders and ground lessor,ifany, harmless from and against any and all loss ofrents and/or damages,liabiliƟes,judgments,claims,expenses,penalƟes,and aƩorneys'and consultants'fees arising out ofor involving any Hazardous Substance brought onto the Premises by orfor Lessee, or anythird party (provided, however, thatLesseeshall haveno liabilityunder this Leasewith respect to underground migraƟon ofanyHazardous Substance under thePremises from areas outside ofthe Project not caused or contributed to byLessee). Lessee's obligaƟons shall include, but notbe limited to,the effectsof anycontaminaƟon or injury to person, property or the environment created or suffered by Lessee, and the cost ofinvesƟgaƟon,removal,remediaƟon,restoraƟon and/or abatement,and shall survivetheexpiraƟon or terminaƟon ofthis Lease. No terminaƟon, cancellaƟonor releaseagreement enteredintoby Lessorand Lesseeshall releaseLesseefrom itsobligaƟons under thisLease withrespect toHazardous Substances, unless specifically so agreed by Lessor in wriƟng at theƟme ofsuch agreement. (e)Lessor IndemnificaƟon. Except asotherwise provided in paragraph8.7,Lessor andits successors and assigns shallindemnify, defend, reimburse and hold Lessee,its employees and lenders,harmless from and against any and allenvironmental damages,including thecost of remediaƟon,which aresuffered as a direct result of Hazardous Substances on the Premises prior to Lessee taking possessionor which are caused bythe grossnegligence orwillful misconduct ofLessor, its agents or employees. Lessor's obligaƟons,as and when required by theApplicable Requirements,shall include,but not be limited to,thecost of invesƟgaƟon, removal,remediaƟon, restoraƟon and/or abatement,and shall survivethe expiraƟon or terminaƟonofthis Lease. (f)InvesƟgaƟons and RemediaƟons. Lessor shall retain theresponsibility and pay for anyinvesƟgaƟons or remediaƟon measures required by governmental enƟƟes having jurisdicƟon withrespect to the existence ofHazardous Substances onthe Premisesprior totheLessee takingpossession,unlesssuch remediaƟon measure is required as aresult ofLessee's use(including "AlteraƟons",as defined inparagraph 7.3(a)below)of thePremises,in which event Lesseeshall beresponsible forsuch payment. Lessee shallcooperate fullyin anysuch acƟviƟes atthe request ofLessor, including allowing Lessorand Lessor's agentsto have reasonable access to the Premises at reasonable Ɵmes in order to carry out Lessor's invesƟgaƟveand remedialresponsibiliƟes. (g)Lessor TerminaƟon OpƟon. If aHazardous Substance CondiƟon(see Paragraph9.1(e))occurs during the termofthis Lease,unless Lesseeis legally responsible therefor (in which caseLesseeshall makethe invesƟgaƟon and remediaƟon thereofrequired by the Applicable Requirements and this Lease shallconƟnue infull force and effect,but subject to Lessor's rightsunder Paragraph 6.2(d) and Paragraph13), Lessormay,at Lessor'sopƟon, either(i)invesƟgate andremediate such Hazardous Substance CondiƟon,if required,as soon as reasonably possibleat Lessor's expense,in which event this Lease shall conƟnue in full forceand effect,or (ii)if the esƟmated costto remediate such condiƟon exceeds 12 Ɵmesthe then monthlyBase Rentor $100,000,whicheveris greater,give wriƩennoƟceto Lessee,within 30 days aŌer receipt byLessor of knowledge of theoccurrence ofsuch Hazardous Substance CondiƟon, ofLessor's desire to terminate this Leaseas ofthe date 60 days following thedate ofsuch noƟce. In theevent Lessorelectsto givea terminaƟonnoƟce,Lessee may,within 10daysthereaŌer, givewriƩen noƟceto Lessorof Lessee's commitment to pay the amount by which the cost of theremediaƟon of such Hazardous SubstanceCondiƟon exceeds an amount equal to 12 Ɵmes the then monthlyBase Rentor $100,000,whichever is greater. Lesseeshall provide Lessorwith saidfunds orsaƟsfactoryassurance thereof within 30days following such commitment. In such event,this Lease shallconƟnue in full forceand effect,and Lessor shallproceed to makesuch remediaƟon as soon as reasonably possibleaŌer the required funds are available. If Lesseedoes notgive such noƟceand provide the required fundsor assurancethereof withintheƟme provided, this Leaseshall DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 6of 18 terminate as ofthe datespecified in Lessor's noƟce ofterminaƟon. 6.3 Lessee's Compliancewith ApplicableRequirements. Exceptas otherwise provided inthisLease, Lesseeshall, atLessee'ssole expense,fully, diligentlyand in a Ɵmelymanner,materiallycomplywith allApplicable Requirements,the requirements ofany applicable fire insurance underwriter or raƟng bureau,and the recommendaƟons of Lessor'sengineers and/or consultants which relate in anymanner tothePremises, withoutregard towhethersaid Applicable Requirements are now in effect or become effecƟveaŌer theStart Date. Lesseeshall,within 10 days aŌer receipt of Lessor's wriƩen request,provide Lessor with copies ofall permits andother documents,and other informaƟonevidencing Lessee'scompliance withany Applicable Requirementsspecified byLessor, andshallimmediately upon receipt,noƟfy Lessor in wriƟng (with copies ofany documents involved) ofanythreatened or actual claim,noƟce,citaƟon,warning,complaint or report pertaining to orinvolving thefailure ofLesseeor thePremises tocomply withanyApplicable Requirements. Likewise,Lesseeshall immediatelygive wriƩennoƟce to Lessorof: (i) anywater damage to thePremises and anysuspected seepage,pooling,dampness or other condiƟon conducive to theproducƟon ofmold; or (ii)any musƟness or otherodors thatmight indicate thepresence ofmold inthe Premises. 6.4 InspecƟon;Compliance.Lessor and Lessor's "Lender"(as defined in Paragraph 30)and consultants authorized byLessor shall have the right to enter into Premisesat anyƟme, inthecase ofan emergency, and otherwise atreasonable ƟmesaŌer reasonable noƟce, for the purpose ofinspecƟng and/or tesƟng the condiƟon of thePremises and/or for verifying compliance by Lesseewith this Lease. Thecost ofanysuch inspecƟons shall bepaid by Lessor,unless aviolaƟon of Applicable Requirements, ora Hazardous Substance CondiƟon (see Paragraph 9.1)is found to exist orbe imminent,orthe inspecƟon is requested orordered bya governmentalauthority. In such case,Lessee shallupon request reimburse Lessor for the cost of such inspecƟon,so long as such inspecƟon is reasonablyrelated to the violaƟon orcontaminaƟon. InaddiƟon, Lesseeshall provide copies ofallrelevant materialsafety datasheets(MSDS) toLessor within10days ofthe receiptof wriƩen request therefor. Lesseeacknowledges that anyfailure on its part to allow such inspecƟonsor tesƟng will expose Lessor to risks and potenƟally cause Lessor toincur costsnot contemplated bythis Lease,the extentof whichwillbe extremelydifficult toascertain. Accordingly, should theLesseefail toallow suchinspecƟons and/or tesƟng in a Ɵmelyfashion the BaseRent shallbe automaƟcally increased,without anyrequirement for noƟce to Lessee,by an amount equal to 10% ofthe thenexisƟng BaseRent or$100,whichever isgreater forthe remaindertothe Lease. TheParƟes agreethat suchincrease in BaseRent represents fair andreasonable compensaƟon for the addiƟonal risk/costs that Lessor willincur byreason ofLessee's failure to allow such inspecƟon and/or tesƟng. Such increase in BaseRent shall inno eventconsƟtute awaiverof Lessee'sDefault orBreach withrespectto such failure norpreventthe exerciseof anyofthe other rights and remediesgranted hereunder. 7. Maintenance;Repairs; UƟlityInstallaƟons;Trade Fixturesand AlteraƟons. 7.1 Lessee's ObligaƟons. (a)In General.Subject to the provisions of Paragraph 2.2 (CondiƟon),2.3(Compliance),6.3(Lessee's Compliance with Applicable Requirements),7.2 (Lessor'sObligaƟons), 9(Damage orDestrucƟon), and 14(CondemnaƟon), Lesseeshall, atLessee'ssole expense, keep thePremises,UƟlity InstallaƟons (intended for Lessee's exclusive use,no maƩer wherelocated),and AlteraƟons in good order,condiƟon and repair (whether or not the porƟon of thePremises requiring repairs,or the means of repairing the same, are reasonably or readily accessible to Lessee,and whether or nottheneed forsuch repairs occurs as aresult ofLessee's use,any prior use,theelements or theage ofsuch porƟon of thePremises),including,but not limited to,all equipment or faciliƟes,such as plumbing,HVAC equipment, electrical,lighƟng faciliƟes,boilers, pressure vessels,fixtures, interiorwalls, interiorsurfaces ofexteriorwalls, ceilings,floors, windows,doors,plateglass,and skylights but excluding any items which are theresponsibility ofLessor pursuant to Paragraph 7.2. Lessee,in keeping thePremises in good order,condiƟon and repair, shallexercise andperform goodmaintenance pracƟces, specifically including theprocurement andmaintenanceof theservice contractsrequired by Paragraph 7.1(b) below. Lessee's obligaƟons shallinclude restoraƟons,replacements or renewals when necessary to keep thePremises and allimprovements thereon or apart thereof ingood order, condiƟon and state of repair. (b)ServiceContracts. Lessee shall,at Lessee's soleexpense,procure and maintain contracts,with copies to Lessor,in customary formand substance for, andwith contractorsspecializing andexperienced in themaintenance ofthe following equipment and improvements, if any,ifand when installed onthePremises: (i) HVAC equipment,(ii)boiler and pressure vessels,and (iii) clarifiers. However,Lessor reserves the right,upon noƟce to Lessee,to procure and maintain anyor allof suchservice contracts,and Lesseeshallreimburse Lessor,upon demand, for thecostthereof. (c)Failureto Perform. IfLesseefails to perform Lessee's obligaƟons under this Paragraph 7.1,Lessor mayenter upon thePremises aŌer 10 days'prior wriƩennoƟcetoLessee(exceptinthecaseofanemergency,inwhichcasenonoƟce shallberequired), performsuch obligaƟons onLessee's behalf, and put the Premises in good order,condiƟon and repair,and Lessee shallpromptly payto Lessor asumequalto 115% ofthe cost thereof. (d)Replacement. Subjectto Lessee'sindemnificaƟon of Lessoras setforthin Paragraph8.7 below,and without relieving Lessee ofliability resulƟng from Lessee's failure to exercise and performgood maintenancepracƟces,ifan itemdescribed in Paragraph 7.1(b) cannot berepaired other than at acost which is in excess of50% ofthe costofreplacing suchitem, thensuch itemshallbe replacedby Lessor, and the costthereof shallbe prorated betweenthe ParƟes and Lesseeshallonly beobligated to pay,each month during theremainder ofthe termofthis Leaseor anyextension thereof,on the dateon which BaseRent is due,an amount equal to the product ofmulƟplying thecostof suchreplacement bya fracƟon,thenumerator ofwhich isone,and thedenominator ofwhichis 144(ie. 1/144thof thecostper month). Lesseeshall payInterest on theunamorƟzed balance but mayprepayits obligaƟon at anyƟme. 7.2 Lessor's ObligaƟons. Subject to the provisions of Paragraphs 2.2 (CondiƟon), 2.3(Compliance), 4.2(Common AreaOperaƟngExpenses), 6(Use), 7.1 (Lessee's ObligaƟons),9(Damageor DestrucƟon) and 14 (CondemnaƟon),Lessor,subject to reimbursement pursuant to Paragraph 4.2,shall keep in good order, condiƟon and repair the foundaƟons, exteriorwalls, structuralcondiƟon ofinterior bearing walls,exterior roof,fire sprinklersystem,Common Areafire alarmand/or smokedetecƟon systems,fire hydrants,parking lots,walkways,parkways,driveways,landscaping,fences,signs and uƟlitysystems serving theCommon Areas and all parts thereof, aswell as providing the servicesfor which there isaCommon AreaOperaƟng Expense pursuant to Paragraph4.2. Lessorshall notbe obligated to paint the exterior or interior surfaces ofexterior walls nor shallLessor be obligated to maintain,repair or replace windows,doors or plate glass of thePremises. 7.3 UƟlity InstallaƟons;Trade Fixtures;AlteraƟons. (a)DefiniƟons.Theterm"UƟlity InstallaƟons"refers to allfloor and window coverings,air and/or vacuumlines,power panels,electrical distribuƟon, security and fireprotecƟon systems,communicaƟon cabling, lighƟngfixtures, HVACequipment, plumbing, andfencing inor onthePremises. The term"Trade Fixtures"shallmean Lessee's machineryand equipment that can be removed without doing material damageto thePremises. Theterm "AlteraƟons"shallmean any modificaƟonof theimprovements, otherthanUƟlity InstallaƟons or TradeFixtures, whether byaddiƟon ordeleƟon. "LesseeOwned AlteraƟons and/or UƟlity InstallaƟons"aredefined as AlteraƟons and/or UƟlity InstallaƟons made byLessee that arenot yet owned byLessor pursuant to Paragraph 7.4(a). (b)Consent. Lesseeshall notmakeany AlteraƟonsor UƟlityInstallaƟonsto thePremises withoutLessor's priorwriƩenconsent. Lessee may,however, makenon­structural AlteraƟons or UƟlityInstallaƟons to theinterior ofthe Premises (excluding the roof)without such consent but upon noƟce to Lessor,as long as theyare not visible fromtheoutside, do not involvepuncturing, relocaƟng orremoving theroof oranyexisƟng walls,will notaffectthe electrical,plumbing, HVAC, and/or life safety systems,do not trigger therequirement for addiƟonal modificaƟons and/or improvements to the Premises resulƟng from Applicable Requirements, suchas compliance with Title24,and/or lifesafety systems,and thecumulaƟve cost thereof during this Leaseas extended does notexceed a sum equal to3 month's BaseRent in the aggregateor asumequalto one month's BaseRent in any oneyear. Notwithstanding the foregoing,Lesseeshall not make or permit anyroof penetraƟons and/or installanything onthe roof without the priorwriƩen approvalofLessor. Lessor may,asa precondiƟon to granƟngsuchapproval, require Lessee DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 7of 18 to uƟlize acontractor chosen and/or approved byLessor. Any AlteraƟons or UƟlity InstallaƟons that Lesseeshalldesire to make and which require the consent ofthe Lessorshall bepresented toLessorin wriƩenform withdetailed plans. Consent shallbe deemedcondiƟoned upon Lessee's: (i)acquiring all applicable governmental permits,(ii) furnishing Lessor with copies of both the permits and theplans and specificaƟons prior to commencement of thework,and (iii)compliance with all condiƟons of saidpermits and otherApplicable Requirements in aprompt andexpediƟous manner. Any AlteraƟonsorUƟlity InstallaƟons shall beperformedin a workmanlikemanner with good and sufficient materials. Lessee shallpromptly upon compleƟon furnishLessor with as­built plans and specificaƟons. For workwhich costs an amountin excess ofone month's Base Rent,Lessor maycondiƟon its consentupon Lesseeproviding a lienand compleƟon bond in anamount equal to 150% ofthe esƟmated cost ofsuch AlteraƟon or UƟlity InstallaƟon and/or upon Lessee's posƟng an addiƟonal SecurityDeposit with Lessor. (c)Liens;Bonds. Lessee shallpay, when due,all claimsfor labor ormaterials furnished or allegedtohave beenfurnished toorfor Lesseeat orfor useon the Premises,which claims areor may besecured byany mechanic's or materialmen's lien against thePremises or anyinterest therein. Lessee shallgive Lessor not lessthan 10days noƟcepriorto thecommencement ofany workin,on orabout the Premises, and Lessorshall have the right to post noƟces of non­responsibility. If Lesseeshall contest the validityofany such lien,claimor demand,then Lessee shall,at its soleexpense defend and protect itself,Lessor and the Premises against the sameand shallpay andsaƟsfyany such adverse judgmentthat mayberendered thereon before theenforcementthereof. If Lessorshallrequire, Lesseeshall furnish asuretybond in an amount equal to 150% ofthe amount ofsuch contested lien,claimor demand,indemnifying Lessor against liabilityfor thesame. If Lessor elects toparƟcipate inany suchacƟon,Lessee shallpay Lessor'saƩorneys' feesandcosts. 7.4 Ownership;Removal;Surrender;and RestoraƟon. (a)Ownership. Subject toLessor'sright torequire removalor electownershipas hereinaŌer provided, allAlteraƟonsand UƟlityInstallaƟons madeby Lesseeshall bethe property ofLessee,but considered apart ofthePremises. Lessor may,at any Ɵme,elect in wriƟng to be the owner of allor any specified part of the Lessee OwnedAlteraƟons andUƟlityInstallaƟons. Unless otherwise instructed per paragraph 7.4(b) hereof, all LesseeOwnedAlteraƟons andUƟlity InstallaƟons shall,at theexpiraƟon or terminaƟon of this Lease,become the property ofLessor and be surrendered byLessee with the Premises. (b)Removal. Bydelivery toLesseeof wriƩennoƟce from Lessornot earlierthan 90and notlaterthan 30days priortothe end of thetermof this Lease, Lessor may require that anyor all LesseeOwned AlteraƟons or UƟlityInstallaƟons be removed by the expiraƟon or terminaƟon of this Lease. Lessor may require the removalat anyƟme ofallor anypart ofany LesseeOwnedAlteraƟons orUƟlity InstallaƟons made without the required consent. (c)Surrender;RestoraƟon. Lessee shallsurrender the Premises by the ExpiraƟon Dateor any earlier terminaƟon date,with all ofthe improvements, partsand surfacesthereof broom cleanand free of debris, and ingoodoperaƟng order, condiƟon andstateof repair, ordinary wearandtear excepted. "Ordinary wear and tear"shall not includeany damageor deterioraƟon that would havebeen prevented by good maintenancepracƟce. Notwithstanding theforegoing and the provisions of Paragraph 7.1(a),iftheLessee occupies the Premises for 12 months or less,then Lesseeshallsurrender thePremises in thesame condiƟon as delivered toLessee onthe StartDate with NOallowance forordinary wearandtear. Lessee shall repair any damageoccasioned bytheinstallaƟon, maintenanceor removal of Trade Fixtures ,Lesseeowned AlteraƟons and/or UƟlity InstallaƟons,furnishings,and equipment as wellas theremoval ofanystorage tankinstalled byor for Lessee. Lesseeshall alsoremove fromthe Premises anyand allHazardous Substances brought onto thePremises byorfor Lessee,or anythird party (except Hazardous Substances which weredeposited viaunderground migraƟon fromareas outsideof theProject)to thelevel specified in Applicable Requirements. TradeFixtures shall remainthe property of Lesseeandshall beremoved byLessee. Anypersonal property of Lesseenot removed onor before theExpiraƟon Dateor anyearlier terminaƟon date shallbe deemed to have been abandoned byLessee and maybe disposed of or retained by Lessor as Lessor maydesire. The failureby Lesseeto Ɵmely vacate the Premises pursuant to this Paragraph 7.4(c) without the express wriƩen consent ofLessor shallconsƟtute a holdover under the provisionsof Paragraph 26 below. 8. Insurance;Indemnity. 8.1 Payment of Premiums.Thecostofthe premiums for theinsurance policies required to be carried by Lessor,pursuant to Paragraphs 8.2(b),8.3(a)and 8.3(b),shall bea CommonArea OperaƟng Expense. Premiums for policyperiods commencing priorto, orextending beyond, theterm ofthis Lease shall be prorated to coincide with the corresponding Start Date or ExpiraƟon Date. 8.2 Liability Insurance. (a)Carried by Lessee. Lesseeshall obtain and keepin force a Commercial General Liability policy of insurance protecƟng Lessee and Lessor as an addiƟonal insured against claims forbodily injury, personal injury and property damage based upon orarising out ofthe ownership, use, occupancy ormaintenance of the Premises and all areas appurtenant thereto. Such insurance shall beon an occurrence basis providing singlelimit coverage in an amount not less than $1,000,000 peroccurrence withan annual aggregate of not less than $2,000,000. Lesseeshall addLessor asanaddiƟonal insuredby meansofan endorsementat leastasbroad as the Insurance Service OrganizaƟon's "AddiƟonal Insured­Managers or Lessors ofPremises"Endorsement. The policyshall not contain any intra­insured exclusions as between insured persons ororganizaƟons, but shallinclude coverage for liabilityassumed under this Lease asan"insured contract"for theperformance of Lessee's indemnity obligaƟons under this Lease. The limits of said insurance shallnot,however,limit theliabilityofLesseenor relieve Lesseeofany obligaƟon hereunder. Lesseeshall provide an endorsementonits liabilitypolicy(ies) whichprovides thatits insurance shall be primarytoand not contributory withany similar insurance carried by Lessor,whose insurance shallbe considered excess insurance only. (b)Carriedby Lessor. Lessorshallmaintain liabilityinsurance asdescribedin Paragraph8.2(a), inaddiƟon to,andnot inlieu of,theinsurance required to bemaintained by Lessee. Lessee shall not be named as an addiƟonal insured therein. 8.3 Property Insurance­ Building,Improvements andRentalValue. (a)Building and Improvements. Lessor shall obtain and keepin force a policy or policies ofinsurancein thename ofLessor,with loss payable to Lessor, anyground­lessor, andto anyLender insuring lossor damageto thePremises. Theamount ofsuchinsurance shallbe equaltothe fullinsurable replacement cost of the Premises,as the sameshallexist from Ɵme to Ɵme,or theamount required by anyLender,butin no event morethan thecommercially reasonable and available insurable value thereof. LesseeOwnedAlteraƟons andUƟlity InstallaƟons, Trade Fixtures,andLessee's personalproperty shallbeinsured byLessee notbyLessor. If the coverage is available and commerciallyappropriate,such policy or policies shallinsure againstallrisks ofdirect physical loss or damage (except the perils of flood and/or earthquake unless required byaLender), including coverage fordebris removaland the enforcementof anyApplicable Requirements requiring the upgrading, demoliƟon,reconstrucƟon or replacement ofanyporƟon ofthe Premises as the result of acovered loss. Said policyor policies shallalso contain an agreed valuaƟon provision in lieuof anycoinsurance clause, waiverof subrogaƟon, and inflaƟonguard protecƟon causing an increase inthe annual property insurance coverage amount by afactor ofnot less than the adjusted U.S. Department ofLabor Consumer Price Index for All Urban Consumers for thecity nearest to where the Premises arelocated. If suchinsurance coverage has a deducƟble clause, thededucƟble amount shallnot exceed $5,000per occurrence. (b)Rental Value. Lessor shallalso obtain and keep in force a policy or policies in thenameofLessor with loss payableto Lessor and anyLender,insuring the loss ofthe fullRentfor oneyear withan extended periodof indemnity for anaddiƟonal 180 days("Rental Valueinsurance"). Saidinsurance shallcontain an agreed valuaƟon provision in lieu ofany coinsurance clause,and the amount ofcoverage shallbe adjusted annually to reflect the projected Rent otherwise payableby Lessee,for the next 12monthperiod. (c)Adjacent Premises. Lessee shallpay for anyincrease in the premiums for the property insurance oftheBuilding and for theCommon Areas or other buildings in the Project ifsaidincrease iscaused byLessee's acts,omissions,use oroccupancy ofthePremises. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 8of 18 (d)Lessee'sImprovements.SinceLessor is the Insuring Party,Lessor shallnot berequired to insure LesseeOwned AlteraƟons and UƟlity InstallaƟons unless the itemin quesƟon has become theproperty ofLessor under the terms ofthis Lease. 8.4 Lessee's Property;Business InterrupƟon Insurance;Worker'sCompensaƟon Insurance. (a)Property Damage. Lesseeshallobtain andmaintain insurance coverage onallof Lessee'spersonal property, Trade Fixtures, and Lessee Owned AlteraƟons and UƟlityInstallaƟons. Such insurance shallbe fullreplacement cost coverage with adeducƟble ofnot to exceed $1,000 per occurrence. Theproceeds fromany suchinsurance shallbeused byLessee forthe replacementofpersonal property, Trade Fixtures and Lessee Owned AlteraƟons and UƟlity InstallaƟons. (b)BusinessInterrupƟon. Lessee shallobtain and maintain loss ofincomeand extraexpense insurancein amounts as will reimburse Lessee for direct or indirect loss ofearnings aƩributable toall perilscommonly insured against byprudent lessees inthe business ofLessee oraƩributable to prevenƟonofaccesstothe Premises as aresult ofsuch perils. (c)Worker'sCompensaƟon Insurance. Lessee shallobtain and maintain Worker'sCompensaƟon Insurance insuch amountas mayberequired by Applicable Requirements. Such policyshall include a'Waiver ofSubrogaƟon'endorsement. Lessee shallprovide Lessor with acopyofsuch endorsement along with the cerƟficate ofinsurance orcopyof thepolicy required by paragraph 8.5. (d)NoRepresentaƟon of Adequate Coverage. Lessor makes no representaƟon that the limits or formsof coverageofinsurance specified herein are adequate to cover Lessee's property, business operaƟons orobligaƟons under this Lease. 8.5 Insurance Policies. Insurance required herein shallbe bycompanies maintaining during the policyterm a"GeneralPolicyholders RaƟng"of at least A­,VII, as set forth in themostcurrent issue of "Best'sInsurance Guide", orsuch other raƟng as maybe required by aLender. Lesseeshall not do orpermitto bedone anything which invalidates the required insurance policies. Lessee shall,prior to theStart Date,deliver to Lessor cerƟfied copies of policies ofsuch insurance or cerƟficates with copies of therequired endorsements evidencing the existence and amounts ofthe required insurance. Nosuch policyshall becancelable or subject to modificaƟon except aŌer 30 days prior wriƩen noƟce to Lessor. Lesseeshall,at least 10 days prior to the expiraƟon ofsuch policies,furnish Lessor with evidence of renewals or "insurance binders" evidencing renewal thereof, orLessor mayincrease hisliabilityinsurance coverageand chargethecost thereofto Lessee,which amount shall bepayable byLesseeto Lessor upon demand. Such policies shall befor atermofat least oneyear,or thelength ofthe remaining term of this Lease, whicheveris less. IfeitherParty shallfail toprocure andmaintainthe insurance required to be carried by it, the other Party may,but shallnot be required to, procure and maintain thesame. 8.6 Waiver ofSubrogaƟon. Without affecƟng anyother rightsor remedies,Lesseeand Lessoreach hereby release and relieve the other, and waive theirenƟre right to recover damages against theother,for loss ofor damageto its property arising out ofor incident to theperils required to be insured against herein. The effect of such releases and waivers is not limited bythe amount ofinsurance carried or required,or by anydeducƟbles applicable hereto. The ParƟes agree to have theirrespecƟve propertydamage insurancecarrierswaive anyright tosubrogaƟon thatsuch companies mayhave against Lessoror Lessee,as thecasemay be, so long as theinsurance is not invalidated thereby. 8.7 Indemnity. Except forLessor's grossnegligence or willfulmisconduct, Lesseeshallindemnify, protect, defend and hold harmless thePremises, Lessorand its agents,Lessor's master or ground lessor,partners and Lenders,from and against any and all claims,loss of rents and/or damages,liens,judgments,penalƟes, aƩorneys' and consultants' fees, expenses and/or liabiliƟes arisingout of,involving, orinconnecƟon with,a Breachofthe Leaseby Lesseeand/orthe use and/or occupancy of thePremises and/or Project by Lesseeand/or byLessee's employees,contractors or invitees .IfanyacƟon or proceeding is brought against Lessor by reason of anyof theforegoing maƩers, Lesseeshall upon noƟce defend thesame atLessee's expensebycounsel reasonably saƟsfactory toLessorand Lessorshall cooperate with Lesseein such defense. Lessor need not have first paid any such claim in order to bedefended or indemnified. 8.8 ExempƟon ofLessor andits AgentsfromLiability. Notwithstanding thenegligence or breach of thisLeaseby Lessoror itsagents, neither Lessornor its agents shall beliable under anycircumstances for:(i) injury or damage to the person or goods,wares,merchandise or other property ofLessee,Lessee's employees, contractors,invitees, customers, or anyotherperson inor aboutthe Premises,whether such damageor injury iscaused byor results fromfire, steam,electricity, gas, water or rain,indoor air quality,the presence of mold or fromthebreakage,leakage,obstrucƟon or other defects ofpipes,firesprinklers,wires,appliances,plumbing, HVACor lighƟngfixtures, orfrom any othercause, whether the saidinjury or damage results from condiƟons arising upon the Premisesorupon otherporƟons ofthe Building,or from other sources or places,(ii)any damages arising from anyact or neglect ofanyother tenant of Lessor or from thefailure ofLessor or its agents to enforce the provisions of anyother lease inthe Project,or (iii)injury to Lessee'sbusiness orforany lossof incomeorprofit therefrom. Instead, it isintended that Lessee's sole recourse in theevent of such damages or injury beto file aclaim on theinsurance policy(ies)that Lesseeis required to maintain pursuant to the provisions of paragraph8. 8.9 Failure toProvide Insurance. Lesseeacknowledges that anyfailure on its part to obtain or maintain the insurancerequired herein will expose Lessor to risks and potenƟally cause Lessorto incur costs not contemplated by this Lease,the extentof whichwillbe extremelydifficult toascertain. Accordingly, for anymonth or porƟon thereof that Lesseedoes not maintain the required insurance and/or does not provide Lessor with the required binders or cerƟficates evidencing the existence of therequired insurance, the Base Rentshall beautomaƟcally increased, without any requirementfor noƟce toLessee, byan amountequalto10%ofthe then exisƟng BaseRent or $100,whichever is greater. The parƟes agreethat such increase in BaseRent represents fair and reasonable compensaƟon for the addiƟonal risk/costs thatLessor willincurby reasonof Lessee'sfailure to maintainthe required insurance. Such increase inBase Rentshallin no event consƟtute a waiver of Lessee's Default or Breach with respect to thefailure to maintain such insurance,prevent theexerciseof anyof theother rights and remedies granted hereunder, nor relieve Lessee ofits obligaƟon to maintain the insurance specified inthis Lease. 9.Damageor DestrucƟon. 9.1 DefiniƟons. (a) "Premises ParƟal Damage"shallmean damage or destrucƟon to the improvements on the Premises,other than LesseeOwned AlteraƟons and UƟlity InstallaƟons, which can reasonably berepaired in 3months orless from the date ofthe damageordestrucƟon, and the cost thereof does notexceed asum equalto6 month's Base Rent. Lessor shall noƟfy Lesseein wriƟng within 30 days from thedate ofthedamage or destrucƟon as to whether or not thedamage is ParƟal or Total. (b) "PremisesTotal DestrucƟon"shall meandamageor destrucƟon to theimprovementson thePremises, otherthan Lessee Owned AlteraƟons and UƟlityInstallaƟons and Trade Fixtures ,which cannot reasonably be repaired in 3months or less from the date of the damage or destrucƟon and/or thecost thereof exceedsa sumequal to6month's BaseRent. Lessor shallnoƟfy Lessee inwriƟng within30days from the date ofthe damage or destrucƟon as to whether or notthe damage is ParƟal or Total. (c) "InsuredLoss" shall mean damageordestrucƟon toimprovements onthe Premises,otherthan LesseeOwned AlteraƟonsandUƟlity InstallaƟons and Trade Fixtures ,which was caused byan event required to be covered bythe insurance described in Paragraph 8.3(a),irrespecƟve of anydeducƟble amounts or coveragelimits involved. (d) "Replacement Cost"shallmean thecost to repair or rebuild theimprovements owned by Lessor at theƟmeof theoccurrence to their condiƟon exisƟng immediately priorthereto, including demoliƟon, debris removal and upgrading required bythe operaƟon ofApplicable Requirements, andwithout deducƟon for depreciaƟon. (e) "Hazardous SubstanceCondiƟon"shall meanthe occurrence or discovery ofa condiƟon involving thepresence of, ora contaminaƟon by,a DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 9of 18 Hazardous Substance,in,on,or under the Premises which requires restoraƟon. 9.2 ParƟal Damage ­ Insured Loss. Ifa PremisesParƟal Damage thatis anInsured Lossoccurs,then Lessorshall, atLessor's expense, repairsuch damage (but not Lessee's Trade Fixture s or LesseeOwned AlteraƟons and UƟlityInstallaƟons) as soon as reasonably possible and this Lease shallconƟnue in full force and effect; provided, however, that Lessee shall, atLessor's elecƟon, make the repair ofanydamage ordestrucƟon thetotalcost torepair ofwhichis $10,000or less,and, insuch event,Lessor shallmake anyapplicable insurance proceeds available to Lessee on areasonable basis for that purpose. Notwithstanding the foregoing,ifthe required insurance was notin force orthe insurance proceeds arenot sufficienttoeffect such repair, theInsuring Party shallpromptly contribute theshortage inproceeds as and when required to complete said repairs. In theevent,however,such shortage was due to thefact that,by reason ofthe unique nature ofthe improvements,full replacementcost insurancecoverage wasnotcommercially reasonable and available,Lessor shallhaveno obligaƟonto payforthe shortage in insurance proceeds or to fully restore the unique aspects of thePremises unless Lessee provides Lessor with thefunds to cover same,or adequate assurance thereof,within 10 days following receipt ofwriƩen noƟce ofsuch shortage and request therefor. IfLessor receivessaid funds oradequate assurance thereof withinsaid10 day period, the partyresponsible for making therepairs shall complete them as soon as reasonably possible and this Leaseshallremain in full force and effect. If such funds or assuranceare notreceived, Lessormaynevertheless electby wriƩennoƟce toLesseewithin 10days thereaŌer to: (i)make suchrestoraƟonand repair asis commerciallyreasonable with Lessor paying anyshortage in proceeds,in which case this Lease shall remain in full force and effect,or (ii)have this Lease terminate 30 days thereaŌer. Lessee shall not be enƟtledto reimbursement of anyfunds contributed byLessee torepair any such damage ordestrucƟon. PremisesParƟal Damage due to flood or earthquake shallbe subject to Paragraph 9.3,notwithstanding that there maybe someinsurance coverage,but the net proceeds of anysuch insurance shallbe madeavailable fortherepairs ifmade byeither Party. 9.3 ParƟal Damage­ Uninsured Loss.IfaPremises ParƟal Damage that is not an Insured Loss occurs,unless caused bya negligent or willful act of Lessee(in whichevent Lesseeshall maketherepairs atLessee's expense), Lessor may either: (i)repair suchdamage as soonas reasonably possible at Lessor'sexpense (subject to reimbursement pursuant to Paragraph 4.2),in which event this Lease shallconƟnue in full force and effect,or (ii)terminate this Leaseby giving wriƩen noƟceto Lesseewithin 30days aŌer receiptby Lessorof knowledge of theoccurrence of suchdamage. SuchterminaƟon shall be effecƟve60days following the date of such noƟce. In the event Lessor elects to terminate this Lease,Lesseeshallhave theright within 10 days aŌer receipt oftheterminaƟon noƟce to givewriƩen noƟce to Lessorof Lessee'scommitment topayfor therepair ofsuch damagewithoutreimbursement fromLessor. Lesseeshall provide Lessor withsaidfunds orsaƟsfactory assurancethereof within 30 days aŌer making such commitment. In such event this Leaseshall conƟnue in full forceand effect,and Lessor shallproceed to make such repairs as soon asreasonably possible aŌer the required funds areavailable. IfLessee doesnotmake therequired commitment,thisLease shall terminate asof the date specified in theterminaƟon noƟce. 9.4 Tota l DestrucƟon.Notwithstanding any other provision hereof,ifa Premises Total DestrucƟo n occurs,this Leaseshallterminate 60 days following such DestrucƟon. Ifthe damageordestrucƟon was caused bythe gross negligence or willfulmisconduct ofLessee,Lessor shallhave therightto recoverLessor's damages fromLessee,except as provided in Paragraph 8.6. 9.5 Damage NearEnd ofTerm. IfatanyƟmeduringthelast6monthsofthisLeasethereisdamageforwhichthecosttorepairexceedsonemonth'sBase Rent,whether or not an Insured Loss,Lessor may terminate this LeaseeffecƟve60 days following thedate of occurrence of such damage by giving awriƩen terminaƟonnoƟce toLessee within30days aŌerthe dateof occurrenceofsuch damage. Notwithstanding theforegoing, ifLessee atthatƟme hasan exercisable opƟon to extend this Leaseor to purchase the Premises,then Lesseemaypreserve this Lease by,(a)exercising such opƟon and (b)providing Lessor with anyshortage ininsurance proceeds (or adequate assurance thereof) needed to makethe repairs onor before the earlierof(i) thedate whichis10 daysaŌer Lessee's receipt of Lessor's wriƩen noƟce purporƟng to terminate this Lease,or (ii)the dayprior to thedate upon which such opƟon expires. IfLessee duly exercises such opƟon during such period andprovides Lessorwith funds (oradequate assurance thereof) to coverany shortage in insurance proceeds, Lessor shall,at Lessor's commercially reasonable expense,repair such damageas soon as reasonably possible and this Leaseshall conƟnue in full force and effect. IfLesseefails to exercise such opƟon and provide such funds or assurance during such period, then this Lease shall terminate on thedate specifiedinthe terminaƟon noƟce and Lessee's opƟon shallbe exƟnguished. 9.6 Abatement ofRent; Lessee'sRemedies. (a)Abatement.In theevent of Premises ParƟal Damage or Premises Total DestrucƟo n or a HazardousSubstance CondiƟon for which Lesseeis not responsible under thisLease, theRentpayable byLessee forthe periodrequired for therepair, remediaƟonorrestoraƟon ofsuch damageshallbe abated in proporƟon to thedegree to which Lessee's use of the Premises is impaired,but not to exceed theproceeds received from theRentalValue insurance. Allother obligaƟons of Lesseehereunder shallbeperformed byLessee, andLessor shallhaveno liabilityfor anysuchdamage, destrucƟon, remediaƟon, repair orrestoraƟon except as provided herein. (b)Remedies. IfLessor isobligatedto repairor restorethePremises anddoes notcommence, inasubstanƟal and meaningful way,such repair or restoraƟon within 90 days aŌer such obligaƟon shallaccrue,Lesseemay,at anyƟme prior to thecommencement of such repair or restoraƟon,give wriƩen noƟce to Lessorand toany Lenders ofwhich Lesseehas actualnoƟce, ofLessee'selecƟon toterminate thisLeaseon adate notlessthan 60days following the givingofsuch noƟce. IfLessee gives such noƟce and such repair or restoraƟon is not commenced within 30 days thereaŌer,this Lease shallterminateas ofthe date specified in said noƟce. Ifthe repair orrestoraƟon iscommenced withinsuch 30days,this Leaseshall conƟnue infull forceand effect. "Commence" shall mean eitherthe uncondiƟonal authorizaƟon of the preparaƟon ofthe required plans,or the beginning ofthe actualwork on thePremises,whichever first occurs. 9.7 TerminaƟon; AdvancePayments. Upon terminaƟon ofthis Leasepursuant to Paragraph 6.2(g) orParagraph 9,anequitable adjustmentshall bemade concerning advance BaseRent and anyother advance payments madeby Lesseeto Lessor. Lessor shall,in addiƟon,return to Lesseeso much ofLessee's Security Depositas hasnot been, oris notthen required to be,usedby Lessor. 10.Real Property Taxes . 10.1 DefiniƟon. Asused herein, the term"RealProperty Taxes"shall include anyform ofassessment; realestate,general, special,ordinary orextraordinary, or rental levy or tax (other than inheritance,personalincome or estate taxes);improvement bond; and/or license feeimposed upon or levied against anylegal or equitable interest ofLessor intheProject, Lessor'sright to other income therefrom, and/or Lessor'sbusiness ofleasing, by anyauthority having thedirect orindirect power to tax and where the funds aregenerated with reference to theProject address. Theterm"Real Property Taxes"shall also include anytax,fee,levy,assessment orcharge, orany increase therein: (i) imposedby reasonof eventsoccurring during theterm ofthis Lease, including but notlimited to, achange intheownershipof the Project,(ii)a change in the improvements thereon,and/or (iii) levied or assessed on machinery or equipment provided byLessor to Lesseepursuant to this Lease. IncalculaƟng RealProperty Taxesforany calendaryear, theReal Property Taxesfor anyreal estate taxyear shall be included inthe calculaƟon of RealPropertyTaxes for such calendar year based upon the number of days which such calendar year and tax year havein common. 10.2 Payment ofTaxes. Exceptas otherwise provided in Paragraph10.3, Lessorshallpay theReal Property Taxesapplicable to the Project,and saidpayments shall be included in thecalculaƟon of Common Area OperaƟng Expenses in accordance with theprovisions ofParagraph 4.2. 10.3 AddiƟonal Improvements. Common AreaOperaƟng Expenses shallnot include Real PropertyTaxesspecified inthe taxassessor'srecords andwork sheets as being caused by addiƟonal improvements placed upon the Project by other lessees or byLessor for theexclusive enjoyment of such other lessees. Notwithstanding Paragraph10.2 hereof, Lessee shall,however,pay toLessor atthe ƟmeCommonArea OperaƟng Expenses arepayable under Paragraph 4.2, theenƟretyof any DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 10of 18 increase in RealProperty Taxes ifassessed solelyby reason of AlteraƟons,Trade Fixture s or UƟlity InstallaƟons placed upon thePremises byLesseeor at Lessee's request or byreason ofanyalteraƟons orimprovements tothe Premises made by Lessorsubsequent to theexecuƟon ofthis Leasebythe ParƟes. 10.4 Joint Assessment.IftheBuilding is not separately assessed,Real PropertyTaxes allocated tothe Building shallbe an equitable proporƟon of theReal PropertyTaxes forall ofthe land and improvements included within the tax parcel assessed,such proporƟontobe determined by Lessorfrom the respecƟve valuaƟons assigned in the assessor's worksheets or such other informaƟon as maybe reasonably available. Lessor's reasonable determinaƟon thereof,in good faith, shallbe conclusive. 10.5 Personal Property Taxes . Lesseeshall payprior to delinquency all taxes assessed against and levied upon LesseeOwned AlteraƟons and UƟlity InstallaƟons, Trade Fixtures, furnishings, equipment and all personal property ofLessee containedinthe Premises. Whenpossible, Lessee shallcause itsLessee Owned AlteraƟons and UƟlity InstallaƟons,Trade Fixtures ,furnishings,equipment and all other personalproperty to be assessed and billed separatelyfrom thereal property of Lessor. Ifanyof Lessee'ssaid property shall beassessedwith Lessor'sreal property, Lesseeshall payLessor thetaxesaƩributable toLessee's property within 10 days aŌer receipt ofa wriƩen statement seƫng forth thetaxes applicable to Lessee's property. 11. UƟliƟes andServices.Lesseeshall payfor allwater, gas, heat,light, power,telephone, trashdisposal and otheruƟliƟes and servicessupplied tothe Premises, together with anytaxes thereon. Notwithstanding theprovisions ofParagraph 4.2,ifat anyƟme inLessor's sole judgment,Lessor determines that Lessee is using a disproporƟonate amount ofwater, electricityorother commonly metered uƟliƟes,or thatLesseeis generaƟngsuch alarge volume oftrash astorequireanincrease in the sizeof thetrash receptacle and/or an increasein the number of Ɵmes per month that it is empƟed,then Lessor may increaseLessee's BaseRent byan amount equal to such increased costs. There shallbe no abatement ofRentand Lessorshall notbe liable in any respect whatsoever for the inadequacy, stoppage, interrupƟon or disconƟnuance ofany uƟlityor service dueto riot,strike,labor dispute,breakdown,accident,repair or other cause beyond Lessor's reasonablecontrolor in cooperaƟonwith governmental request ordirecƟons. Within fiŌeen days of Lessor’s wriƩen request,Lesseeagrees to deliver to Lessor such informaƟon,documents and/or authorizaƟon as Lessor needs in order for Lessorto comply with new orexisƟng Applicable Requirements relaƟng to commercialbuilding energy usage, raƟngs,and/or the reporƟng thereof. 12.Assignment and Subleƫng. 12.1 Lessor's ConsentRequired. (a) Lessee shallnot voluntarily or by operaƟon of law assign,transfer,mortgageor encumber (collecƟvely,"assign or assignment") or sublet allor any partof Lessee'sinterest inthisLease orin thePremises withoutLessor's prior wriƩenconsent. (b) Unless Lessee is acorporaƟon and its stock is publicly traded on anaƟonal stockexchange,achangein thecontrol ofLesseeshall consƟtute an assignment requiring consent. Thetransfer,on acumulaƟve basis,of 25%or more ofthe voƟng controlof Lesseeshall consƟtute achange in control for this purpose. (c) Theinvolvement ofLessee oritsassets inany transacƟon, or seriesoftransacƟons (byway ofmerger,sale, acquisiƟon, financing, transfer, leveraged buy­out or otherwise),whether or not a formalassignment or hypothecaƟon ofthis Lease or Lessee'sassets occurs,which results or willresult in areducƟon ofthe NetWorth ofLessee byanamount greaterthan 25%of suchNetWorth asit wasrepresented at the Ɵme ofthe execuƟon ofthis Lease or atthe Ɵme ofthe most recent assignment to which Lessor has consented,or as it exists immediatelyprior to said transacƟon or transacƟons consƟtuƟng such reducƟon,whichever was or is greater, shall beconsidered anassignmentof thisLease towhich Lessormaywithhold itsconsent. "NetWorth ofLessee" shallmeanthe networth ofLessee (excluding any guarantors)established under generally accepted accounƟng principles. (d) Anassignment orsubleƫng withoutconsentshall, atLessor's opƟon,be a Default curable aŌer noƟce per Paragraph 13.1(d), or a noncurable Breach without the necessityof anynoƟceand graceperiod. If Lessor elects to treat such unapproved assignment or subleƫng as a noncurable Breach,Lessor may either:(i) terminate this Lease,or (ii)upon 30 days wriƩen noƟce,increase themonthlyBase Rentto 110%ofthe BaseRent thenineffect. Further, inthe eventofsuch Breach and rental adjustment,(i) the purchase price ofany opƟon to purchase thePremises held by Lesseeshallbe subject to similar adjustment to 110%of theprice previously in effect,and (ii)allfixed andnon­fixed rentaladjustments scheduled during the remainder of the Leaseterm shallbe increased to 110% ofthe scheduled adjusted rent. (e) Lessee's remedyforany breach of Paragraph12.1 byLessorshall belimited tocompensatory damages and/or injuncƟve relief. (f) Lessor mayreasonably withhold consent to aproposed assignment or subleƫng ifLesseeis in Default at the Ɵmeconsent is requested. (g) Notwithstanding theforegoing, allowinga deminimisporƟon ofthe Premises, ie.20 square feet orless,to be used by a third party vendor in connecƟon with theinstallaƟon ofavending machineor payphone shall not consƟtute a subleƫng. 12.2 Terms andCondiƟonsApplicable toAssignment andSubleƫng. (a) Regardless ofLessor's consent,no assignment or subleƫng shall: (i)be effecƟve without the express wriƩen assumpƟon by such assigneeor sublessee of the obligaƟons ofLesseeunder thisLease, (ii)release Lesseeofany obligaƟonshereunder, or(iii)alter theprimary liabilityofLessee forthe paymentof Rent or for the performance ofany other obligaƟons to be performed byLessee. (b) Lessormay acceptRent orperformance of Lessee'sobligaƟons from anyperson otherthan Lesseepending approval ordisapproval ofan assignment. Neither adelayin theapprovalor disapproval of such assignment nor theacceptance ofRent or performanceshall consƟtute a waiver or estoppel ofLessor's right to exerciseits remediesfor Lessee'sDefaultor Breach. (c) Lessor's consent to any assignment or subleƫng shallnot consƟtute a consent to any subsequent assignment or subleƫng. (d) Inthe eventof anyDefault or Breach by Lessee,Lessormay proceed directly against Lessee, anyGuarantors or anyoneelse responsible forthe performance of Lessee's obligaƟons under this Lease,including any assigneeor sublessee,without first exhausƟng Lessor's remedies against any other person or enƟtyresponsible therefor to Lessor,orany securityheld byLessor. (e) Each request for consent to an assignment or subleƫng shallbe in wriƟng,accompanied byinformaƟon relevant to Lessor's determinaƟon as to the financial and operaƟonal responsibility and appropriateness of theproposed assigneeor sublessee, including but notlimited totheintended useand/or required modificaƟon of thePremises,ifany,together with afeeof$500 as consideraƟon for Lessor's considering and processing said request. Lesseeagrees to provide Lessor withsuch otheror addiƟonal informaƟonand/or documentaƟon as maybe reasonably requested. (See alsoParagraph 36) (f) Any assigneeof,or sublesseeunder,this Leaseshall,by reason ofaccepƟng such assignment,entering into such sublease,or entering into possession ofthe Premisesor anyporƟonthereof, bedeemed tohave assumedandagreed toconform andcomply with eachand everyterm,covenant, condiƟon and obligaƟon herein to be observed or performed by Lesseeduring theterm ofsaid assignment or sublease,other than such obligaƟons as arecontraryto or inconsistent with provisions of anassignment orsublease to whichLessor hasspecifically consented toin wriƟng. (g) Lessor's consent to anyassignment or subleƫng shall not transfer to theassignee or sublessee anyOpƟon granted to theoriginalLesseebythis Lease unless such transferis specificallyconsentedto byLessor inwriƟng. (See Paragraph 39.2) 12.3 AddiƟonal Terms an d CondiƟons Applicableto Subleƫng.Thefollowing terms and condiƟons shall apply to anysubleƫng by Lesseeof allor anypart of the Premises and shall bedeemedincluded inall subleases under this Lease whether ornot expressly incorporated therein: (a) Lessee hereby assigns and transfers to Lessor all ofLessee's interest in all Rent payable on anysublease,and Lessor maycollect such Rent and apply DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 11of 18 sametoward Lessee's obligaƟons under this Lease; provided,however,that unƟl aBreach shall occur in theperformance of Lessee's obligaƟons,Lesseemaycollect saidRent. In the eventthat the amount collected by Lessorexceeds Lessee's then outstanding obligaƟons anysuch excess shall be refunded to Lessee.Lessorshall not,by reason of theforegoing or anyassignment ofsuch sublease,nor by reason of the collecƟonofRent,be deemed liableto thesublessee for any failureofLessee toperform and comply withanyof Lessee'sobligaƟons tosuch sublessee. Lessee hereby irrevocably authorizes anddirects anysuch sublessee, upon receipt ofa wriƩen noƟce fromLessor staƟng that aBreach exists in the performance ofLessee's obligaƟons under this Lease,to payto Lessor allRent due and to become due under the sublease. Sublessee shallrely upon any such noƟce from Lessorand shallpay allRentsto Lessorwithout anyobligaƟon or rightto inquire as towhether such Breach exists,notwithstanding anyclaimfrom Lesseeto thecontrary. (b) Inthe eventof aBreachby Lessee,Lessor may,atits opƟon,require sublessee to aƩorntoLessor, inwhich eventLessorshall undertake the obligaƟons of the sublessor under such subleasefromtheƟmeoftheexerciseofsaid opƟon to theexpiraƟon ofsuch sublease;provided,however,Lessor shall not be liable for anyprepaid rentsorsecurity deposit paid bysuch sublessee tosuch sublessor or foranyprior Defaultsor Breaches ofsuch sublessor. (c) AnymaƩer requiring the consent ofthe sublessor under asublease shallalso require the consent ofLessor. (d) No sublessee shall further assignorsublet allor anypartof thePremises withoutLessor's priorwriƩenconsent. (e) Lessor shalldeliver acopyofanynoƟceofDefault or Breach by Lesseeto the sublessee,who shallhavethe right to cure the Default ofLessee within the grace period,if any,specified in such noƟce. The sublesseeshall have a right ofreimbursementand offsetfrom andagainstLessee forany suchDefaults cured by the sublessee. 13. Default; Breach;Remedies. 13.1 Default;Breach.A"Default"is defined as afailurebytheLesseeto comply with or perform any ofthe terms,covenants,condiƟons or Rules and RegulaƟons under this Lease. A"Breach" isdefined asthe occurrence ofone ormore ofthefollowing Defaults,and thefailureof Lesseeto curesuch Defaultwithin anyapplicable graceperiod: (a) The abandonment of thePremises;or thevacaƟng ofthe Premiseswithout providing acommercially reasonable levelof security,or where the coverageof theproperty insurance described in Paragraph 8.3 is jeopardized as aresult thereof,or without providing reasonable assurances to minimizepotenƟal vandalism. (b) Thefailure ofLessee to makeany payment of Rent or any SecurityDeposit required to be made by Lessee hereunder,whether to Lessor or to athird party,when due, to provide reasonable evidence ofinsurance orsurety bond, orto fulfill any obligaƟonunder this Leasewhich endangers orthreatens lifeor property,where such failure conƟnues for aperiod of 3business days following wriƩen noƟce to Lessee. THE ACCEPTANCEBY LESSOR OF A PARTIALPAYMENT OF RENTOR SECURITYDEPOSIT SHALLNOTCONSTITUTE AWAIVER OF ANY OF LESSOR'SRIGHTS,INCLUDING LESSOR'SRIGHTTO RECOVER POSSESSIONOF THE PREMISES. (c) Thefailure ofLessee to allow Lessor and/or its agents access to thePremises or the commissionofwaste,act or acts consƟtuƟng public or private nuisance, and/or anillegal acƟvityonthe Premisesby Lessee,where suchacƟonsconƟnue fora periodof3 businessdays followingwriƩennoƟce toLessee. In the event that Lesseecommits waste,anuisance or an illegalacƟvity asecond Ɵme then,the Lessor mayelect to treat such conduct as anon­curable Breach rather than a Default. (d) Thefailure byLessee to provide(i) reasonablewriƩen evidenceofcompliance with Applicable Requirements,(ii) theservicecontracts,(iii)the rescissionof anunauthorized assignmentorsubleƫng, (iv)an Estoppel CerƟficate orfinancialstatements, (v)a requested subordinaƟon, (vi) evidenceconcerning any guarantyand/or Guarantor,(vii) anydocument requested under Paragraph 41,(viii) materialsafetydata sheets (MSDS),or (ix)any other documentaƟon or informaƟon which Lessor may reasonably require of Lessee under the terms ofthis Lease, where any suchfailure conƟnues fora periodof10 days following wriƩen noƟce to Lessee. (e) A DefaultbyLessee asto theterms, covenants,condiƟons or provisions of thisLease,or ofthe rulesadopted under Paragraph2.9 hereof, other than thosedescribed in subparagraphs 13.1(a),(b),(c) or (d),above,where such Default conƟnues for aperiod of30 days aŌer wriƩen noƟce; provided,however,that if the nature ofLessee's Defaultissuch thatmore than30 days arereasonably required for itscure, then itshall notbe deemed to be aBreach ifLesseecommences such cure within said 30 dayperiod and thereaŌer diligentlyprosecutes such cure to compleƟon. (f) The occurrence ofany ofthe followingevents: (i)the makingofany generalarrangement orassignment forthebenefit ofcreditors; (ii)becoming a "debtor"as defined in 11U.S.C.§ 101or anysuccessor statute thereto (unless,in the caseofa peƟƟon filed against Lessee,the sameis dismissed within 60 days);(iii) the appointment ofa trustee orreceiver totake possessionof substanƟallyallof Lessee'sassets locatedatthe Premisesor ofLessee'sinterest inthis Lease,where possession is not restored to Lesseewithin 30 days; or (iv) theaƩachment,execuƟon or other judicialseizureof substanƟallyall ofLessee's assets located at the Premisesor ofLessee's interestinthis Lease,where suchseizure isnotdischarged within 30 days;provided, however, inthe eventthat any provisionofthis subparagraph is contrary to anyapplicable law,such provision shallbe ofno force or effect,and not affect thevalidity oftheremaining provisions. (g) The discovery that anyfinancial statementofLessee orof anyGuarantor given toLessor wasmateriallyfalse. (h) Ifthe performance of Lessee's obligaƟons under this Lease is guaranteed: (i)the death of aGuarantor,(ii) theterminaƟon ofaGuarantor's liability withrespect to this Lease other than inaccordance withthe terms ofsuch guaranty,(iii) aGuarantor'sbecoming insolventor thesubject of abankruptcy filing, (iv) a Guarantor's refusal to honor the guaranty,or (v)a Guarantor's breach ofits guaranty obligaƟon on an anƟcipatorybasis,and Lessee's failure,within 60 days following wriƩennoƟce ofany suchevent,to provide wriƩen alternaƟve assurance orsecurity,which, whencoupled withthethen exisƟngresources ofLessee,equals or exceeds the combined financial resources ofLessee and the Guarantors that existed at the Ɵmeof execuƟon ofthis Lease. 13.2 Remedies. IfLessee failsto performanyof itsaffirmaƟve duƟes orobligaƟons, within 10 daysaŌer wriƩen noƟce(or incase ofanemergency, without noƟce),Lessor may,at its opƟon,perform such duty or obligaƟon on Lessee's behalf,includingbut not limited to theobtaining of reasonably required bonds, insurance policies, orgovernmental licenses,permitsor approvals. Lesseeshall payto Lessor anamount equal to 115% ofthe costsandexpenses incurred by Lessor in such performance upon receipt ofan invoicetherefor. In theevent of aBreach,Lessor may,with or without further noƟceor demand,and without limiƟng Lessor inthe exerciseof anyrightor remedy which Lessormay have byreason ofsuch Breach: (a) Terminate Lessee's right to possession of thePremises byany lawful means,in which case this Leaseshall terminate and Lesseeshallimmediately surrender possession toLessor. Insuch eventLessor shallbe enƟtledtorecover fromLessee: (i)the unpaid Rent which had been earned at theƟme ofterminaƟon; (ii)the worth at the Ɵmeof award of theamount by which the unpaid rent which would have been earned aŌer terminaƟon unƟl the Ɵme ofaward exceeds the amountof suchrental lossthatthe Lesseeproves couldhave beenreasonably avoided; (iii)the worthatthe Ɵme of award ofthe amountby which the unpaidrentfor the balance ofthe termaŌer the Ɵmeof award exceeds theamount of such rental loss that the Lesseeproves could be reasonably avoided; and (iv)any other amount necessaryto compensate Lessor forallthe detrimentproximately caused by theLessee'sfailure toperform itsobligaƟons under this Lease orwhich in theordinary course of things would belikelyto result therefrom,including but not limited to thecost ofrecovering possession ofthe Premises,expenses of releƫng,including necessary renovaƟon and alteraƟon ofthe Premises, reasonable aƩorneys'fees,and that porƟonof anyleasing commission paid by Lessorin connecƟon withthis Leaseapplicable to the unexpired term of this Lease. The worth at the Ɵmeof award ofthe amount referred to in provision (iii)of theimmediately preceding sentence shall be computed bydiscounƟng such amountat the discount rateofthe FederalReserve Bank ofthe Districtwithin whichthePremises are located atthe DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 12of 18 Ɵmeof award plus onepercent. Efforts by Lessor to miƟgatedamages caused byLessee's Breach ofthis Leaseshall not waiveLessor's right to recover any damages to whichLessor isotherwise enƟtled. If terminaƟonof thisLease isobtained through theprovisional remedy ofunlawful detainer, Lessor shallhavetherighttorecover in such proceeding any unpaid Rent and damages as arerecoverable therein,or Lessor mayreserve theright to recover all or anypart thereofin aseparatesuit.Ifa noƟceand graceperiod required under Paragraph 13.1was not previously given,anoƟce topay rentorquit, orto perform orquit givento Lesseeunder the unlawful detainer statute shall also consƟtute thenoƟce required by Paragraph 13.1. In such case,the applicable graceperiod required by Paragraph 13.1and theunlawful detainer statute shallrun concurrently, and the failure of Lesseeto cure theDefault withinthe greaterofthe twosuch graceperiodsshall consƟtutebothanunlawful detainer and aBreach ofthis Lease enƟtling Lessor to the remedies provided for in this Leaseand/or by said statute. (b) ConƟnuethe Leaseand Lessee'srightto possessionand recover theRent as it becomes due, inwhich event Lesseemay sublet orassign, subject only to reasonable limitaƟons. Acts ofmaintenance,efforts to relet,and/or theappointment of areceiver to protect the Lessor's interests,shallnot consƟtute a terminaƟonof theLessee's righttopossession. (c) Pursue any other remedy now or hereaŌer availableunder thelaws or judicial decisions of the state wherein the Premises are located. The expiraƟon orterminaƟon ofthis Leaseand/or the terminaƟonof Lessee'sright topossessionshall notrelieve Lesseefromliability under any indemnity provisions of thisLease as to maƩers occurring or accruing during theterm hereofor byreason of Lessee's occupancy ofthe Premises. 13.3 Inducement Recapture.Anyagreementforfreeorabatedrentorothercharges,thecostoftenantimprovementsfor Lesseepaid foror performed by Lessor,or for the giving or paying byLessor to or for Lesseeof anycash or other bonus,inducement or consideraƟon for Lessee's entering into this Lease,allofwhich concessions are hereinaŌer referred to as "Inducement Provisions,"shall bedeemed condiƟoned uponLessee's full and faithful performance of allof theterms, covenants and condiƟons of this Lease. Upon Breach ofthis LeasebyLessee,anysuch Inducement Provision shall automaƟcally be deemed deleted from this Lease andof nofurther forceoreffect, and any rent,other charge, bonus, inducement orconsideraƟon theretofore abated, given orpaid byLessorunder such an Inducement Provision shallbe immediatelydueand payable by Lesseeto Lessor,notwithstanding any subsequent cure ofsaid Breach byLessee. Theacceptance by Lessor of rent or the cure of the Breach which iniƟated the operaƟon of this paragraph shallnotbe deemed a waiverby Lessor ofthe provisions of this paragraph unless specifically so stated in wriƟng by Lessor at theƟme ofsuch acceptance. 13.4 Late Charges. Lessee hereby acknowledges thatlatepayment byLessee ofRentwill cause Lessor toincur costs notcontemplated bythis Lease,theexact amount of which will beextremelydifficult to ascertain. Such costs include,but arenot limited to,processing and accounƟng charges,and late charges which maybe imposed upon Lessorby anyLender. Accordingly, if anyRent shallnotbe received by Lessorwithin 5 days aŌer suchamountshall be due, then, without any requirement for noƟce to Lessee,Lesseeshall immediatelypay to Lessor aone­Ɵmelatechargeequal to 10%of each such overdue amount or $100,whichever is greater. TheparƟes hereby agree that such late chargerepresents afair and reasonable esƟmate of the costs Lessor will incur byreason ofsuch latepayment. Acceptance of suchlate charge byLessor shallin noevent consƟtute awaiver ofLessee's DefaultorBreach withrespect to suchoverdue amount,nor prevent the exerciseof anyof theother rights and remedies granted hereunder. In the event that alatechargeis payable hereunder,whether or not collected,for 3consecuƟve installmentsof BaseRent, thennotwithstanding any provision of thisLease to the contrary, BaseRent shall, atLessor's opƟon, become due and payable quarterly in advance. 13.5 Interest. Anymonetary paymentdue Lessorhereunder, other thanlate charges, notreceived byLessor, whendue shall bearinterest fromthe 31stday aŌer it was due. Theinterest ("Interest")charged shallbe computed at the rateof 10%per annum but shall not exceed the maximumrate allowed by law. Interest is payable in addiƟon to the potenƟallate charge provided forin Paragraph 13.4. 13.6 Breach by Lessor. (a)NoƟce ofBreach. Lessorshall notbe deemedin breachofthis Leaseunless Lessorfailswithin areasonable Ɵmetoperform anobligaƟon required to beperformed byLessor. For purposes ofthis Paragraph,a reasonable Ɵmeshall in no event be lessthan 30 days aŌer receipt byLessor,and any Lender whosename andaddress shallhave beenfurnished to Lesseein wriƟngfor suchpurpose,of wriƩennoƟce specifyingwhereinsuch obligaƟonof Lessorhasnot beenperformed; provided,however,that if thenature of Lessor's obligaƟon is such that morethan 30 days are reasonably required for its performance,then Lessor shallnot be in breach if performance is commenced within such 30day period and thereaŌer diligentlypursued to compleƟon. (b)Performanceby Lesseeon Behalf of Lessor.In the event that neither Lessor nor Lender cures said breach within 30 days aŌer receipt ofsaid noƟce, orif having commenced saidcure they do not diligently pursue itto compleƟon, thenLessee mayelectto cure said breach atLessee's expense and offsetfrom Rent the actual and reasonable cost to perform such cure,provided however,that such offset shallnot exceed an amount equalto thegreater of onemonth's BaseRent or the Security Deposit, reserving Lessee'srightto reimbursement from Lessorfor anysuchexpense inexcess ofsuchoffset. Lessee shalldocumentthe costof saidcure and supply said documentaƟon to Lessor. 14. CondemnaƟon. If thePremisesor anyporƟon thereof aretaken under the powerof eminentdomainor sold under thethreat of theexercise ofsaidpower (collecƟvely"CondemnaƟon"),this Lease shallterminate as to the part taken as ofthe date the condemning authoritytakes Ɵtleor possession,whichever first occurs. Ifmore than10% ofthefloor areaof theUnit, ormorethan 25%of theparkingspaces istaken byCondemnaƟon, Lessee may,at Lessee'sopƟon, tobeexercisedin wriƟng within 10 days aŌer Lessor shall have given LesseewriƩen noƟce ofsuch taking (or in theabsenceofsuch noƟce,within 10 days aŌer thecondemning authority shall havetaken possession) terminate this Leaseas ofthe date thecondemning authority takes such possession. IfLessee does not terminate this Lease in accordance with theforegoing,this Leaseshall remain in full force and effect as to the porƟon ofthe Premises remaining,except that the BaseRent shallbe reduced inproporƟon tothe reducƟon inuƟlity ofthe Premisescaused bysuchCondemnaƟon. CondemnaƟon awards and/orpayments shallbe theproperty of Lessor, whether such award shall bemadeas compensaƟon for diminuƟon in valueofthe leasehold,the valueofthe part taken,or for severance damages; provided, however, that Lessee shall be enƟtledto anycompensaƟon paid by the condemnor for Lessee'srelocaƟon expenses, lossof business goodwill and/or TradeFixtures, without regard to whether or not this Leaseis terminated pursuant to theprovisions ofthis Paragraph. All AlteraƟons and UƟlityInstallaƟons made to the Premises byLessee, forpurposes ofCondemnaƟon only, shall be considered the property ofthe Lesseeand Lesseeshallbe enƟtledto anyandall compensaƟon whichis payable therefor. In theevent that this Lease is not terminated by reason ofthe CondemnaƟon,Lessor shall repair any damageto the Premises caused bysuch CondemnaƟon. 15.Brokerage Fees. 15.1 AddiƟonal Commission.In addiƟon to the paymentsowed pursuant to Paragraph 1.10 above, Lessoragrees that: (a) if Lessee exercises any OpƟon, (b) if Lesseeor anyoneaffiliated with Lesseeacquires fromLessor anyrights to thePremises or other premises owned by Lessor and located within the Project,(c) ifLessee remains in possessionof thePremises,with theconsent ofLessor, aŌerthe expiraƟon ofthis Lease,or(d) ifBase Rentisincreased, whetherby agreementor operaƟon of an escalaƟon clauseherein,then,Lessor shall payBrokers afeein accordance with thefeeschedule ofthe Brokers in effect at the Ɵmethe Leasewas executed. Theprovisions ofthis paragraph are intended to supersede theprovisions of anyearlier agreementtothe contrary. 15.2 AssumpƟon of ObligaƟons.Anybuyer or transferee of Lessor's interest in this Leaseshallbe deemed to have assumed Lessor's obligaƟon hereunder. Brokers shall bethird partybeneficiaries of theprovisions ofParagraphs 1.10,15,22 and31. IfLessor failsto paytoBrokers anyamounts due as andfor brokerage fees pertaining to this Leasewhen due,then such amounts shall accrueInterest.In addiƟon,ifLessor fails to pay anyamounts to Lessee's Broker when due,Lessee's DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 13of 18 Broker may send wriƩen noƟce to Lessor and Lessee ofsuch failure and if Lessor fails to pay such amounts within 10 days aŌer said noƟce,Lesseeshall pay said moniesto itsBroker and offsetsuch amountsagainst Rent. InaddiƟon, Lessee's Brokershall be deemedto be a third party beneficiary ofany commission agreement entered into by and/or between Lessor and Lessor's Broker for the limited purpose of collecƟng any brokerage fee owed. 15.3 RepresentaƟons andIndemniƟesof Broker RelaƟonships.Lessee and Lessoreach represent and warrantto the otherthat ithas had no dealings withany person,firm,broker,agent or finder (other than the Brokers and Agents,ifany) in connecƟonwith this Lease,and that no oneother than said named Brokers and Agentsis enƟtledto anycommissionor finder's fee inconnecƟon herewith. Lessee and Lessor doeachhereby agreeto indemnify, protect, defend and holdtheother harmless from and against liabilityfor compensaƟon or charges which may beclaimed by anysuch unnamed broker,finder or other similar partyby reason of any dealings or acƟons of theindemnifying Party, including any costs,expenses, aƩorneys' fees reasonably incurred with respect thereto. 16.Estoppel CerƟficates. (a) Each Party(as "RespondingParty")shall within10 daysaŌer wriƩennoƟcefrom theother Party(the"RequesƟng Party")execute, acknowledge and deliver to the RequesƟng Partyastatement in wriƟng in form similar to the then most current "Estoppel CerƟficate" form published BY AIR CRE,plus such addiƟonal informaƟon,confirmaƟon and/orstatements asmaybe reasonably requested by the RequesƟng Party. (b) Ifthe Responding Party shall fail to execute or deliver theEstoppel CerƟficate within such 10 dayperiod,the RequesƟng Party may execute an Estoppel CerƟficate staƟng that: (i) the Lease isin full force and effectwithout modificaƟon except asmaybe represented by the RequesƟng Party, (ii)there areno uncured defaults in the RequesƟng Party's performance,and (iii) ifLessor is the RequesƟng Party,not morethan one month's rent has been paid in advance. ProspecƟve purchasers and encumbrancers mayrely upon the RequesƟng Party's Estoppel CerƟficate, and the Responding Party shallbe estopped from denying the truth of thefacts contained in said CerƟficate. In addiƟon,Lesseeacknowledges that anyfailureon its part to provide such an Estoppel CerƟficatewill expose Lessor to risks andpotenƟally cause Lessorto incurcosts notcontemplated by thisLease, theextent ofwhichwill beextremely difficulttoascertain. Accordingly, should the Lesseefail to execute and/or deliver a requested Estoppel CerƟficate in aƟmelyfashion themonthly BaseRent shall be automaƟcally increased,without any requirement for noƟceto Lessee,byan amountequal to 10% ofthethen exisƟngBase Rentor$100, whichever is greaterforremainder ofthe Lease. TheParƟes agree that such increase in BaseRent represents fair and reasonable compensaƟon for the addiƟonal risk/costs that Lessor will incur by reason ofLessee's failure to provide the Estoppel CerƟficate. Such increase in Base Rentshall innoevent consƟtute a waiverofLessee's Defaultor Breachwithrespect tothe failure to provide the Estoppel CerƟficate nor prevent theexercise ofany ofthe other rights and remedies granted hereunder. (c) IfLessor desires to finance, refinance, or sellthe Premises,or anypart thereof, Lesseeand allGuarantorsshall within10 daysaŌer wriƩen noƟce fromLessor deliver to anypotenƟallender or purchaser designated by Lessor such financial statements as maybereasonably required by such lender or purchaser, including but not limited to Lessee's financial statements for thepast 3years. Allsuch financialstatements shall bereceived byLessor and such lender or purchaser in confidence and shallbe usedonly for the purposes herein set forth. 17.DefiniƟon of Lessor.Theterm "Lessor"as used herein shall mean the owner or owners at the Ɵmein quesƟon ofthe feeƟtle to thePremises,or,if this is a sublease, of the Lessee's interest inthe priorlease. In the eventof atransfer ofLessor'sƟtle orinterest inthePremises orthis Lease,Lessor shalldeliver to the transferee or assignee(in cash or by credit) any unused Security Deposit held by Lessor. Upon such transfer or assignment and deliveryof theSecurity Deposit,as aforesaid, the priorLessor shallberelieved ofall liabilitywith respect to the obligaƟons and/or covenants under this LeasethereaŌer to be performed bythe Lessor. Subject to theforegoing,theobligaƟons and/or covenants in this Lease to beperformed bythe Lessor shallbe binding only upon theLessor as hereinabove defined. 18. Severability.The invalidityofany provision of thisLease,as determined by acourt ofcompetentjurisdicƟon, shall in nowayaffect thevalidity ofanyother provision hereof. 19. Days.Unless otherwise specificallyindicated to the contrary, the word "days"as used in thisLeaseshall meanand refer to calendar days. 20.LimitaƟon on Liability.The obligaƟons ofLessor under this Lease shallnot consƟtute personal obligaƟons ofLessor,or its partners,members,directors,officers orshareholders, andLessee shalllookto thePremises, andto nootherassets ofLessor, forthesaƟsfacƟon ofany liabilityofLessor withrespect tothis Lease,and shallnot seekrecourse against Lessor's partners,members,directors,officers or shareholders,or any oftheir personalassets for such saƟsfacƟon. 21. Time ofEssence.Timeis ofthe essencewithrespect tothe performance of allobligaƟons to beperformed orobservedby theParƟes under thisLease. 22.No Prior or Other Agreements;Broker Disclaimer.This Leasecontains allagreements between theParƟes with respect to any maƩer menƟoned herein,and no otherprior orcontemporaneous agreementorunderstanding shallbe effecƟve. LessorandLessee eachrepresents andwarrantsto theBrokers thatithas made,and is relying solelyupon,its own invesƟgaƟon as to thenature,quality,character and financialresponsibility oftheother Party to this Leaseand as to theuse,nature, quality and characterof thePremises. Brokershave noresponsibility withrespectthereto orwith respecttoany defaultor breachhereofby eitherParty. 23.NoƟces. 23.1 NoƟce Requirements. All noƟcesrequired orpermiƩedby thisLease orapplicable law shallbe in wriƟngand maybe delivered in person (byhand orby courier) or maybe sent by regular,cerƟfied or registered mail or U.S.Postal ServiceExpress Mail,with postage prepaid,or byfacsimiletransmission,or by email,and shall be deemed sufficiently givenifserved ina manner specified inthis Paragraph 23. Theaddressesnoted adjacentto aParty'ssignature onthis Lease shall bethat Party's address for delivery or mailing of noƟces. Either Party may by wriƩen noƟceto theother specify adifferent address for noƟce,except that upon Lessee's takingpossession ofthe Premises,thePremises shallconsƟtute Lessee's address fornoƟce. Acopy ofallnoƟces to Lessor shallbe concurrently transmiƩedto such partyor parƟes at such addresses as Lessor may fromƟme to ƟmehereaŌer designate in wriƟng. 23.2 Date ofNoƟce. AnynoƟce sentbyregistered orcerƟfied mail,return receipt requested, shall be deemed given onthe date of delivery shown on the receipt card,or if no delivery date is shown,the postmark thereon. If sent by regular mailthe noƟceshall bedeemed given 72 hours aŌer the sameis addressed as required herein andmailed withpostage prepaid. NoƟces delivered by United States Express Mailor overnight courier that guarantees next daydelivery shall be deemed given 24 hours aŌer deliveryof thesame to the PostalServiceor courier. NoƟces deliveredby hand,or transmiƩed byfacsimile transmission or by email shall be deemeddelivered uponactualreceipt. If noƟceis receivedona Saturday, Sunday orlegalholiday, itshall bedeemed received onthe nextbusiness day. 23.3 OpƟons.Notwithstanding theforegoing,in order to exercise any OpƟons (see paragraph 39),theNoƟcemust besent byCerƟfied Mail (return receipt requested), Express Mail (signature required), courier (signature required) or someother methodologythatprovides areceipt establishing thedate the noƟce was received by theLessor. 24. Waivers. (a) No waiver by Lessor ofthe Default or Breach of anyterm,covenant or condiƟon hereof byLessee,shallbe deemed awaiver ofany other term, covenant or condiƟon hereof, orofany subsequent Default orBreach by Lesseeof the same orofany otherterm, covenantorcondiƟon hereof. Lessor'sconsent to, DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 14of 18 or approval of,any act shallnot be deemed to render unnecessary theobtaining ofLessor's consent to,or approval of,anysubsequent or similar act byLessee,or be construed as thebasis ofanestoppel to enforce theprovision orprovisions of this Lease requiring such consent. (b) Theacceptance ofRent byLessor shall not be awaiver of anyDefault or Breach byLessee. Anypayment by Lesseemay be accepted byLessor on account of moniesor damages due Lessor, notwithstanding any qualifying statements orcondiƟons made byLessee inconnecƟon therewith, whichsuch statements and/or condiƟons shallbe ofno force or effect whatsoever unless specificallyagreed to in wriƟng by Lessor at or before the Ɵmeof deposit of such payment. (c) THEPARTIES AGREETHAT THETERMSOF THISLEASE SHALLGOVERN WITHREGARDTO ALLMATTERS RELATEDTHERETOAND HEREBYWAIVE THE PROVISIONSOF ANYPRESENT OR FUTURESTATUTE TO THE EXTENTTHAT SUCHSTATUTEIS INCONSISTENTWITH THISLEASE. 25. Disclosures RegardingThe Natureofa RealEstate AgencyRelaƟonship. (a) When entering into adiscussion with arealestateagent regarding arealestatetransacƟon,aLessor or Lesseeshould from theoutset understand whattype ofagency relaƟonship orrepresentaƟon ithas withthe agentoragents inthe transacƟon. Lessor and Lessee acknowledge being advised bythe Brokersin this transacƟon,as follows: (i)Lessor'sAgent. A Lessor's agent under alisƟng agreementwith theLessoracts asthe agent forthe Lessoronly. A Lessor'sagentor subagent has the following affirmaƟve obligaƟons:To the Lessor: A fiduciarydutyof utmost care,integrity,honesty,and loyaltyin dealings with the Lessor.To the Lessee and theLessor: (a) Diligentexerciseof reasonableskills andcare inperformance of the agent's duƟes. (b) Aduty ofhonest and fairdealing and good faith. (c) Adutyto discloseall facts known to theagent materiallyaffecƟng thevalue or desirability of the property that arenot known to,or within the diligent aƩenƟon and observaƟonof, theParƟes. Anagent isnot obligated to reveal to either Partyany confidenƟalinformaƟonobtained from the otherPartywhich doesnot involve the affirmaƟve duƟes set forth above. (ii)Lessee'sAgent. Anagent can agree to actas agentfor the Lessee only. In these situaƟons, the agentis notthe Lessor'sagent,even ifby agreement the agent may receivecompensaƟon for services rendered,either in full or in part from theLessor. An agent acƟng onlyfor aLessee has the following affirmaƟve obligaƟons.To theLessee: A fiduciary duty of utmostcare, integrity, honesty, and loyaltyindealings withthe Lessee.To theLessee andthe Lessor:(a) Diligent exercise ofreasonable skills and care in performance ofthe agent's duƟes. (b)A duty ofhonest and fair dealing and good faith. (c)A duty to disclose allfacts known to theagent materiallyaffecƟng the valueor desirability of thepropertythat arenot knownto,or withinthe diligentaƩenƟonand observaƟonof,theParƟes. An agent is not obligated to reveal to either Partyany confidenƟalinformaƟon obtained from the other Party which does not involvetheaffirmaƟve duƟes set forth above. (iii)Agent RepresenƟng BothLessor and Lessee. Areal estateagent,either acƟng directly or through oneor moreassociatelicenses,can legally be the agent ofboth theLessor and theLessee in atransacƟon,but only with the knowledge and consent ofboth theLessor and theLessee. In adual agency situaƟon, the agent has the following affirmaƟveobligaƟons to both theLessor and theLessee: (a)A fiduciaryduty of utmostcare, integrity,honestyand loyaltyin the dealings with either Lessor or theLessee. (b)Other duƟes to theLessor and theLessee as stated above in subparagraphs (i)or (ii). In represenƟng both Lessor and Lessee,the agentmay not,without theexpress permission ofthe respecƟve Party, disclosetothe otherParty confidenƟalinformaƟon, including, but not limited to, facts relaƟng to either Lessee’s or Lessor’s financialposiƟon,moƟvaƟons,bargaining posiƟon,or other personalinformaƟon that may impact rent,including Lessor’s willingness to accepta rentless than the lisƟng rentor Lessee’swillingness to payrent greaterthan therentoffered. The aboveduƟesof theagent ina realestatetransacƟon do not relieve a Lessor or Lesseefrom theresponsibility to protect their own interests. Lessor and Lesseeshould carefully read allagreements to assure that they adequately express theirunderstanding ofthe transacƟon. A realestate agentisa person qualified to advise about realestate. Iflegal ortax advice is desired, consult acompetent professional. Both Lessor and Lesseeshould stronglyconsider obtaining tax advice from a competent professional because the federal and state tax consequences of atransacƟon can be complex and subject to change. (b) Brokers have no responsibility with respect to anydefault or breach hereof byeither Party. The ParƟes agree that no lawsuit or other legal proceeding involving anybreach ofduty, error oromission relaƟng to this Leasemay bebrought against Brokermore than one yearaŌerthe StartDate andthatthe liability(including court costs and aƩorneys'fees),ofany Broker with respect to any such lawsuit and/or legalproceeding shallnot exceed thefee received by such Brokerpursuant to this Lease;provided, however, that the foregoing limitaƟon oneachBroker's liabilityshall notbeapplicable toany grossnegligence or willful misconduct of such Broker. (c) Lessorand Lesseeagree toidenƟfy to Brokersas "ConfidenƟal"any communicaƟon orinformaƟon givenBrokers thatisconsidered bysuch Partyto be confidenƟal. 26. No RightTo Holdover. Lessee hasno righttoretain possessionof thePremises oranypart thereof beyond the expiraƟon or terminaƟon of this Lease. Inthe event that Lesseeholds over,then the BaseRent shallbe increased to 150% ofthe BaseRent applicable immediatelypreceding theexpiraƟon or terminaƟon. HoldoverBase Rentshall becalculatedon monthlybasis. Nothing contained herein shall be construed as consentby Lessorto anyholding over byLessee. 27.CumulaƟve Remedies.No remedy or elecƟon hereunder shallbedeemed exclusive but shall,wherever possible,becumulaƟve with all other remedies at law or inequity. 28.Covenants and CondiƟons;ConstrucƟon of Agreement.All provisions ofthis Leaseto beobserved or performed by Lessee are both covenants and condiƟons. Inconstruing this Lease, allheadings and Ɵtlesare forthe convenience of the ParƟesonly andshallnot beconsidered apartof thisLease. Whenever required bythe context,the singular shall include theplural and vice versa. This Leaseshall not be construed asif prepared by oneofthe ParƟes,but rather according to its fair meaning as awhole, asifboth ParƟes had prepared it. 29.Binding Effect;Choice of Law.This Lease shallbe binding upon the ParƟes,their personal representaƟves,successors and assigns and begoverned bythe laws ofthe State in whichthePremises arelocated. Any liƟgaƟonbetweenthe ParƟeshereto concerningthisLease shallbe iniƟatedinthe countyin whichthePremises arelocated. Signatures to this Lease accomplished by means of electronicsignature or similar technology shallbe legal and binding. 30. SubordinaƟon; AƩornment;Non­Disturbance. 30.1 SubordinaƟon.This Lease and any OpƟon granted hereby shallbe subject and subordinate to anyground lease,mortgage,deed of trust,or other hypothecaƟonor securitydevice (collecƟvely,"SecurityDevice"), nowor hereaŌer placed upon thePremises, toany andalladvances madeon the security thereof, and to allrenewals,modificaƟons,and extensions thereof. Lesseeagrees that theholders ofany such SecurityDevices (in this Leasetogether referred to as "Lender") shallhave noliability orobligaƟonto perform any ofthe obligaƟons ofLessor under this Lease. Any Lender may electto have this Lease and/or any OpƟongranted hereby superior to the lien ofits Security Device bygiving wriƩen noƟcethereof to Lessee,whereupon this Lease and such OpƟons shallbe deemed prior to such SecurityDevice, notwithstanding the relaƟve datesof thedocumentaƟon orrecordaƟon thereof. 30.2 AƩornment.In the event that Lessor transfers Ɵtle to the Premises,or the Premises are acquired byanother upon the foreclosure or terminaƟon ofa SecurityDevice towhich thisLeaseis subordinated (i) Lesseeshall, subject to the non­disturbanceprovisions ofParagraph 30.3, aƩorn to suchnew owner, and upon request,enter into anew lease,containing allof theterms and provisions of this Lease,with such new owner for theremainder of theterm hereof,or,at theelecƟon DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 15of 18 ofthe new owner,this Leasewill automaƟcallybecome anew leasebetween Lessee and such new owner,and (ii)Lessor shallthereaŌer be relieved of anyfurther obligaƟons hereunder and such new owner shall assume all ofLessor's obligaƟons, exceptthat suchnew ownershallnot: (a)be liableforany actor omissionof any prior lessor or with respect to events occurring prior to acquisiƟon ofownership; (b) besubject to anyoffsets or defenses which Lesseemight have against anyprior lessor, (c)be bound byprepayment ofmore than one month'srent,or (d)be liableforthe returnof anysecuritydeposit paidto anyprior lessorwhichwasnotpaidor credited to such new owner. 30.3 Non­Disturbance. Withrespect toSecurity Devicesenteredinto byLessor aŌer theexecuƟon ofthis Lease,Lessee'ssubordinaƟon ofthis Leaseshall be subject to receiving acommerciallyreasonablenon­disturbance agreement (a "Non­DisturbanceAgreement") fromtheLender which Non­Disturbance Agreement provides that Lessee'spossession ofthePremises, andthis Lease,including anyopƟonsto extendthe termhereof, will notbe disturbed solong asLessee isnot in Breach hereof and aƩorns to therecord owner of thePremises. Further,within 60 days aŌer theexecuƟon ofthis Lease,Lessor shall,ifrequested byLessee,use its commerciallyreasonable effortsto obtain aNon­Disturbance Agreementfrom theholder ofanypre­exisƟng SecurityDevice whichissecured bythe Premises. In the event that Lessor is unableto provide theNon­Disturbance Agreement within said 60 days,then Lessee may,at Lessee's opƟon,directly contact Lender and aƩempt tonegoƟate forthe execuƟonanddelivery ofa Non­Disturbance Agreement. 30.4 Self­ExecuƟng.Theagreements contained in this Paragraph 30 shallbe effecƟvewithout the execuƟon of anyfurther documents; provided,however,that, upon wriƩen request from Lessorora Lender in connecƟon with asale,financing orrefinancing ofthePremises, Lesseeand Lessorshallexecute suchfurther wriƟngs as may bereasonably required to separately document any subordinaƟon,aƩornment and/or Non­Disturbance Agreement provided for herein. 31. AƩorneys' Fees.IfanyParty orBroker bringsanacƟon orproceeding involvingthe Premises whetherfounded intort, contractorequity, orto declarerights hereunder,the Prevailing Party (as hereaŌer defined) in any such proceeding,acƟon,or appeal thereon,shall beenƟtled to reasonableaƩorneys'fees. Such fees may beawarded inthe samesuitor recovered in aseparate suit,whetheror notsuch acƟonorproceeding ispursued todecisionor judgment. Theterm, "Prevailing Party"shall include,without limitaƟon,aPartyor Broker who substanƟally obtains or defeats therelief sought,as the casemay be,whether by compromise, seƩlement,judgment, orthe abandonment bythe otherParty orBroker ofits claim or defense. The aƩorneys' feesaward shallnotbe computed in accordance with anycourt fee schedule,but shallbe such as to fully reimburse allaƩorneys'fees reasonably incurred. In addiƟon,Lessor shallbeenƟtled to aƩorneys'fees,costs and expenses incurred inthe preparaƟon and service ofnoƟces ofDefault and consultaƟons in connecƟontherewith, whether ornot alegal acƟonissubsequently commenced in connecƟon with such Default or resulƟng Breach ($200 is areasonable minimum per occurrence for such services and consultaƟon). 32. Lessor's Access;Showing Premises;Repairs.Lessorand Lessor'sagentsshall have the rightto enterthe Premises atany Ɵme,inthe caseof anemergency, and otherwise at reasonable Ɵmes aŌer reasonableprior noƟce for thepurpose ofshowing the sameto prospecƟve purchasers,lenders,or tenants,and making such alteraƟons,repairs,improvements or addiƟons to the Premises as Lessor may deemnecessaryor desirableand theerecƟng,using and maintaining ofuƟliƟes, services,pipes and conduits through thePremises and/orother premises as longasthere isno materialadverseeffect onLessee's useofthe Premises.Allsuch acƟviƟes shall bewithout abatement ofrent or liability to Lessee. 33. AucƟons.Lessee shallnotconduct, nor permit to beconducted, anyaucƟon upon the PremiseswithoutLessor's priorwriƩen consent. Lessor shallnot be obligated to exerciseany standard ofreasonableness in determining whether to permit an aucƟon. 34. Signs.Lessor mayplaceon the Premises ordinary "ForSale" signs at anyƟme andordinary "For Lease"signs during thelast 6months oftheterm hereof. Except for ordinary "For Sublease"signs which may beplaced onlyon thePremises,Lessee shallnot place anysign upon the Project without Lessor's prior wriƩen consent. Allsigns mustcomply withallApplicable Requirements. 35.TerminaƟon ;Merger.Unless specificallystated otherwisein wriƟng by Lessor,thevoluntary or other surrender ofthis Leaseby Lessee,themutual terminaƟon orcancellaƟon hereof, or aterminaƟonhereof byLessor forBreach byLessee,shall automaƟcallyterminate anysubleaseor lesserestate inthePremises; provided, however,that Lessor may elect to conƟnue anyone or all exisƟng subtenancies. Lessor's failure within 10 days following any such event to elect to thecontrary by wriƩennoƟce tothe holder ofany suchlesser interest,shall consƟtute Lessor'selecƟon tohave such eventconsƟtute theterminaƟon ofsuch interest. 36.Consents.All requests for consent shallbe in wriƟng. Except as otherwise provided herein,wherever in this Lease theconsent of aParty is required to an act by orfor the other Party,such consent shallnot be unreasonably withheld ordelayed. Lessor's actualreasonable costs andexpenses (including butnot limitedto architects',aƩorneys',engineers'and other consultants'fees) incurred in theconsideraƟon of,or response to,arequest byLessee for any Lessor consent,including but not limited to consents to an assignment,a subleƫng or the presence or use of aHazardous Substance, shallbe paid by Lessee upon receipt ofan invoiceand supporƟng documentaƟon therefor. Lessor's consent to anyact,assignment or subleƫng shallnot consƟtute an acknowledgment that no Default or Breach byLessee ofthis Leaseexists, norshallsuch consentbe deemeda waiverofany thenexisƟng DefaultorBreach, exceptas maybeotherwise specificallystated inwriƟng by Lessor at theƟme ofsuch consent. The failureto specifyherein any parƟcular condiƟon to Lessor's consent shallnot preclude the imposiƟon byLessor at the Ɵmeof consentof suchfurther orothercondiƟons asare thenreasonable withreference to the parƟcular maƩerforwhich consentis being given. Inthe eventthat either Party disagrees with any determinaƟon madeby theother hereunder and reasonably requests the reasons for such determinaƟon,the determining party shallfurnish itsreasons inwriƟng and inreasonable detail within 10business days following such request. 37.Guarantor. 37.1 ExecuƟon. TheGuarantors, ifany, shalleachexecute aguaranty intheform mostrecently published BYAIR CRE. 37.2 Default.Itshall consƟtute a Default ofthe Lesseeif anyGuarantor fails or refuses,upon request to provide: (a)evidence oftheexecuƟon ofthe guaranty, including the authorityof thepartysigning onGuarantor's behalfto obligateGuarantor,and inthe caseofa corporateGuarantor, acerƟfiedcopy ofa resoluƟon of its board of directors authorizing themaking of such guaranty,(b) current financial statements,(c) an Estoppel CerƟficate,or (d) wriƩen confirmaƟon that theguaranty is sƟll in effect. 38.Quiet Possession.Subject to payment byLessee oftheRent and performance ofall ofthecovenants,condiƟons and provisions on Lessee's part to be observed andperformed underthis Lease,Lesseeshall havequiet possessionand quiet enjoymentof thePremises during theterm hereof. 39.OpƟons.If Lesseeis granted anyopƟon,as defined below,then the following provisions shallapply. 39.1 DefiniƟon."OpƟon"shall mean: (a)theright toextend orreduce the termof orrenewthis Lease or toextend orreduce the termof orrenew any lease that Lessee has on other property of Lessor;(b) theright offirst refusal or first offer to lease either the Premises or other property of Lessor;(c) theright to purchase, the right offirst offertopurchase orthe rightof firstrefusal to purchase the Premisesorother property of Lessor. 39.2 OpƟons Personal ToOriginal Lessee.AnyOpƟon granted to Lessee in this Lease is personal to theoriginal Lessee,and cannot be assigned or exercised by anyoneother thansaid originalLesseeand onlywhile theoriginal Lesseeisin fullpossession ofthePremises and, if requested byLessor, withLesseecerƟfyingthat Lesseehas no intenƟon ofthereaŌer assigning or subleƫng. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 16of 18 39.3 MulƟple OpƟons.In theevent that Lesseehas anymulƟple OpƟons to extend or renew this Lease,alater OpƟon cannot be exercised unless the prior OpƟons have beenvalidly exercised. 39.4 Effect of Default on OpƟons. (a) Lessee shallhave norightto exercisean OpƟon: (i)during the periodcommencing withthegiving ofany noƟceofDefault andconƟnuing unƟlsaid Default is cured,(ii) during theperiod ofƟme anyRent is unpaid (without regard to whether noƟcethereof is given Lessee),(iii)during theƟme Lesseeis in Breach of thisLease, or(iv) intheevent thatLessee hasbeen given3or morenoƟces of separateDefault, whetheror nottheDefaults arecured, during the 12monthperiod immediatelypreceding the exercise ofthe OpƟon. (b) Theperiod ofƟme withinwhichan OpƟonmaybeexercisedshallnotbeextendedor enlargedbyreason ofLessee's inability toexercise anOpƟon because of the provisions ofParagraph 39.4(a). (c) AnOpƟonshallterminateandbeofnofurtherforceoreffect,notwithstanding Lessee's due and Ɵmelyexerciseof theOpƟon, if,aŌer such exercise and prior to the commencement ofthe extended term or compleƟon ofthepurchase,(i)Lessee fails to pay Rent for aperiod of 30 days aŌer such Rent becomes due (without any necessityof Lessortogive noƟcethereof), or(ii) ifLesseecommits aBreach ofthisLease. 40.Security Measures.Lesseeherebyacknowledges that the Rent payable to Lessor hereunder does not include thecost ofguard serviceor other security measures, and thatLessor shall have no obligaƟon whatsoever to provide same. Lessee assumesall responsibility forthe protecƟon of thePremises,Lessee, its agents and invitees and their property from theacts ofthird parƟes. 41. ReservaƟons.Lessor reservesthe right: (i)to grant,without the consent or joinder of Lessee,sucheasements, rightsand dedicaƟons thatLessor deems necessary,(ii) to cause the recordaƟon of parcelmaps and restricƟons,and (iii)to create and/or installnew uƟlity raceways,so long as such easements,rights, dedicaƟons, maps, restricƟons, and uƟlityracewaysdo notunreasonably interferewith the useof thePremises byLessee. Lesseeagrees tosignany documents reasonably requested byLessor to effectuate such rights. 42. Performance UnderProtest.Ifat anyƟme adispute shall ariseas toany amountorsum ofmoney tobepaid by one Partytothe otherunder theprovisions hereof,the Partyagainst whomtheobligaƟon to pay the money is asserted shall have the right to make payment "under protest"and such payment shall not be regarded as avoluntary paymentand there shall survive the right onthe part ofsaid PartytoinsƟtute suitfor recovery ofsuch sum. Ifit shallbeadjudged thatthere was no legalobligaƟon on thepart ofsaid Party to paysuch sum or any part thereof,said Partyshall beenƟtled to recover such sumor so much thereof as it was not legallyrequired topay. AParty whodoes notiniƟate suitforthe recovery of sums paid "under protest" within 6monthsshall be deemed to have waived itsrightto protest such payment. 43.Authority;MulƟpleParƟes;ExecuƟon. (a) If eitherParty hereto isa corporaƟon, trust, limited liability company,partnership, or similarenƟty, eachindividual execuƟng thisLease on behalf of such enƟty represents and warrants that he or she is duly authorized to execute and deliver this Leaseon its behalf. Each Party shall,within 30 days aŌer request, deliver to theother PartysaƟsfactoryevidence ofsuch authority. (b) Ifthis Leaseis executed bymore than one person or enƟty as "Lessee",each such person or enƟty shallbe jointlyand severally liablehereunder. It is agreedthat anyone ofthenamed Lesseesshall beempowered toexecuteany amendmentto thisLease,or other document ancillary thereto and bindall ofthe named Lessees,and Lessor mayrelyon thesame as if allofthe named Lessees had executed such document. (c) ThisLease maybe executedbythe ParƟesin counterparts, each ofwhichshall be deemed anoriginaland allof whichtogether shall consƟtute one and the sameinstrument. 44. Conflict.Any conflictbetweenthe printed provisions ofthis Lease and the typewriƩen or handwriƩen provisions shall be controlled bythe typewriƩen or handwriƩen provisions. 45. Offer. PreparaƟon ofthis Lease byeither partyortheir agentand submission of sametothe otherParty shallnotbe deemedan offertolease tothe other Party. This Lease is not intended to be binding unƟl executed and delivered byall ParƟes hereto. 46. Amendments.This Leasemaybe modified only inwriƟng,signed bythe ParƟes in interest at the Ɵmeof themodificaƟon. Aslong astheydo notmaterially change Lessee's obligaƟons hereunder,Lesseeagrees to makesuch reasonable non­monetary modificaƟons to this Leaseas maybereasonably required by aLender inconnecƟon withthe obtaining ofnormal financing or refinancing of thePremises. 47.Waiver of Jury Trial.THE PARTIESHEREBY WAIVE THEI R RESPECTIVE RIGHTSTO TRIAL BY JURY IN ANY ACTION OR PROCEEDINGINVOLVINGTHE PROPERTY ORARISING OUTOF THISAGREEMENT. 48. ArbitraƟon ofDisputes.AnAddendum requiring the ArbitraƟon ofall disputes between theParƟes and/orBrokersarising outof thisLease is isnot aƩached to thisLease. 49.Accessibility;Americanswith DisabiliƟesAct. (a) The Premises: have not undergone aninspecƟon by aCerƟfied AccessSpecialist (CASp). Note: ACerƟfied AccessSpecialist(CASp) caninspect thesubject premises and determine whether thesubject premises comply with allof the applicable construcƟon­related accessibilitystandards under state law. Although state lawdoes not require a CASp inspecƟon ofthesubject premises,the commercial property owner or lessor maynot prohibit thelessee or tenant fromobtaining aCASpinspecƟon of the subject premises for theoccupancy or potenƟaloccupancy ofthe lessee ortenant, ifrequested bythelessee ortenant. TheparƟes shall mutuallyagree onthe arrangements for theƟme and manner of theCASp inspecƟon,the payment ofthe feefor theCASpinspecƟon,and the cost ofmaking anyrepairs necessary to correctviolaƟons ofconstrucƟon­related accessibilitystandards within thepremises. have undergone an inspecƟon by a CerƟfiedAccess Specialist(CASp) and itwas determined that thePremisesmet allapplicable construcƟon­related accessibilitystandards pursuant to California CivilCode §55.51et seq.Lesseeacknowledges that itreceived acopyof theinspecƟon report atleast48hourspriorto execuƟng this Leaseand agrees to keep such report confidenƟal. have undergone an inspecƟon by a CerƟfiedAccess Specialist(CASp) and itwas determined that thePremises did notmeet allapplicable construcƟon­related accessibilitystandards pursuant to California CivilCode §55.51et seq. Lesseeacknowledges that itreceived acopyoftheinspecƟon report at least 48hours prior to execuƟng this Lease and agrees to keep such report confidenƟal except asnecessary to complete repairs andcorrecƟons of violaƟonsof construcƟon related DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________________ ________________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved.Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 17of 18 accessibilitystandards. Inthe eventthat thePremiseshave beenissued aninspecƟon report bya CASp the Lessorshallprovide acopy ofthedisability accessinspecƟon cerƟficate to Lessee within 7days of theexecuƟon of this Lease. (b) Sincecompliance withthe AmericanswithDisabiliƟes Act(ADA) andotherstate andlocal accessibilitystatutes aredependent upon Lessee'sspecific useof thePremises,Lessor makes no warranty or representaƟon as to whether or not the Premises comply with ADAor anysimilar legislaƟon. In theevent that Lessee'suse ofthe Premises requires modificaƟons oraddiƟons to the Premisesinorder tobe incompliance with ADAor otheraccessibilitystatutes, Lesseeagrees to makeany such necessary modificaƟons and/or addiƟons at Lessee's expense. LESSORAND LESSEEHAVE CAREFULLYREADAND REVIEWEDTHIS LEASEAND EACHTERM AND PROVISIONCONTAINED HEREIN,ANDBY THEEXECUTION OFTHIS LEASESHOW THEIR INFORMED ANDVOLUNTARY CONSENT THERETO.THEPARTIES HEREBY AGREETHAT, AT THE TIMETHISLEASE ISEXECUTED, THETERMSOF THISLEASE ARECOMMERCIALLY REASONABLEANDEFFECTUATE THEINTENT ANDPURPOSE OFLESSORAND LESSEEWITH RESPECTTOTHE PREMISES. ATTENTION :NOREPRESENTATION OR RECOMMENDATION IS MADEBY AIR CRE OR BY ANY BROKER AS TOTHELEGAL SUFFICIENCY,LEGAL EFFECT,OR TAX CONSEQUENCESOF THISLEASE ORTHETRANSACTION TOWHICH ITRELATES. THEPARTIES AREURGED TO: 1.SEEK ADVICE OF COUNSEL AS TOTHE LEGAL ANDTAX CONSEQUENCESOF THISLEASE. 2. RETAINAPPROPRIATE CONSULTANTSTOREVIEW ANDINVESTIGATE THECONDITION OF THE PREMISES. SAID INVESTIGATION SHOULDINCLUDE BUTNOT BE LIMITEDTO:THEPOSSIBLE PRESENCEOF HAZARDOUS SUBSTANCES,THE ZONINGOF THEPREMISES,THE STRUCTURAL INTEGRITY, THE CONDITION OF THEROOF ANDOPERATING SYSTEMS,COMPLIANCE WITH THE AMERICANS WITH DISABILITIES ACTAND THESUITABILITYOF THEPREMISES FORLESSEE'SINTENDED USE. WARNING :IF THE PREMISESARELOCATED IN ASTATEOTHER THAN CALIFORNIA,CERTAIN PROVISIONSOF THE LEASEMAY NEEDTO BEREVISEDTO COMPLY WITH THELAWSOFTHESTATEINWHICHTHEPREMISESARELOCATED. TheparƟes hereto have executed this Lease atthe placeand onthedates specifiedabove theirrespecƟvesignatures. Executedat: On: By LESSOR: R&R Real Properties, Inc By: NamePrinted:Richard L. Rossen Title:Secretary Phone:559-446-0182 Fax: Email:Bob Mott - bob@northstarmanagement.net (property manager) By: NamePrinted: Title: Phone: Fax: Email: Address:7108 N Fresno St #370, Fresno,CA 93720 Federal ID No.: Executedat: On: By LESSEE: Responsible and Compliant Retail Blackstone, LLC, dba Embarc Fresno By: NamePrinted:Dustin Moore Title:Managing Member Phone: Fax:goembarc.com Email:dustin@goembarc.com By: NamePrinted: Title: Phone: Fax: Email: Address:1201 K Street, Suite #920, Sacramento, CA 95814 Federal ID No.: BROKER Colliers Tingey International, Inc. AƩn:Zack Kaufman Title:Sr. Associate Address:7485 N Palm Ave #110, Fresno,CA 93711 Phone:559 -221-1271 Fax: BROKER Colliers Tingey International, Inc dba Colliers International AƩn:Zack Kaufman Title:Sr. Associate Address:7485 N Palm Ave #110, Fresno,CA 93711 Phone:559-221-1271 DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 12/2/202012/3/2020 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM MTN­26.30, Revised11­25­2019 Page 18of 18 Email:zack.kaufman@colliers.com Federal ID No.: BrokerDRE License#:00452468 AgentDRE License#:01902869 Fax: Email:zack.kaufman@colliers.com Federal ID No.: BrokerDRE License#:00452468 AgentDRE License#:01902869 AIR CRE * hƩps://www.aircre.com *213­687­8777 * contracts@aircre.com NOTICE: Nopart oftheseworks maybe reproducedin anyformwithout permissionin wriƟng. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________________ ________________ INITIALS INITIALS © 2017AIR CRE. AllRights Reserved.Last Edited: 12/2/2020 9:55AM ADD­1.03, Revised06­10­2019 Page 1 of 2 x x x x x x x x x ADDENDUM TO LEASE Date:12/2/2020 By and Between Lessor:R&R Real Properties, Inc Lessee:Responsible and Compliant Retail Blackstone, LLC, dba Embarc Fresno Property Address:4592 N Blackstone Ave #103, Fresno, CA 93726 (street address, city,state, zip) Paragraph:50- 56 Inthe eventof anyconflict between the provisions ofthis Addendum and the printed provisions ofthe Lease, this Addendum shallcontrol. AIR CRE * hƩps://www.aircre.com *213­687­8777 * contracts@aircre.com NOTICE: Nopart oftheseworks maybe reproducedin anyformwithout permissionin wriƟng. 50. Rent Schedule: Months 1-12: Months 13-24: Months 25-36: Months 37-48: Months 49-60: 51. Licensing Contingency Period: In exchange for a non-refundable licensing contingency fee, Lessor agreesto provide Lessee until the end of March of 2021,toreceive all proper licenses to operate legal retail and delivery cannabissales from City and State officials. Should the licensing period exceed the end of March, 2021,Lessee shall continue to pay per month in lieu of Base Rent or otherCommon Area Operating Expenses (NNN) until the license is awarded. 52. Lease &Rent Commencement: The Lease shall commenceupon a fully executed Lease agreement betweenthe Parties, and receipt of the consideration outlined in paragraph 1.7,by the Lessor. The Rent shall commence upon waiver of the licensing contingency periodcontained in Paragraph 51 by Lessee. 53. Compliance with Laws: Notwithstanding anything herein tothe contrary, Landlord acknowledges that Tenant’s Agreed Use is, at the time of the execution of this Lease,a violation of federal law, and Landlordagrees that such violation shall not cause Tenant to forfeit the Premisesor otherwise be in default or breach of this Lease.Moreover, as used in this Lease, HazardousSubstances shall expressly exclude cannabis, cannabis productsor any related products used in the normal course of business for a cannabisstorefront retailer with delivery services. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2017AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM ADD­1.03, Revised06­10­2019 Page 2 of 2 x x x 54. Licensing: (a) Tenant Obligations. During the term of the Lease, Tenant agreesthat it shall apply for all final permits, authorizations and approvals necessary in connection with the Agreed Use, including,without limitation, the regulatory permits and/or licenses from (i) the City of Fresno (the “City”), (ii) the State of California (the “State”), or (iii)any other applicable governmental or regulatory authority,in connection with Tenant’s Agreed Use, including,without limitation, the regulatory permit andState retailer license, as determined by Tenant in its sole and absolute discretion (any of the foregoing in (i) through (iii) collectively,referred to herein as the “Licenses,”and each individually,a“License”) (b) Landlord Cooperation.During the term of the Lease, Landlord covenantsand agrees that it shall,within the parameters of applicable law, in good faith and in amannerthat is commercially reasonable, cooperate with Tenant to perform all lawful acts to timely process and execute any and all of Tenant’s applications,authorizations, consents or other documents in connection with the City and State orin connection with the Tenant’s Licenses, tothe extent the same require Landlord’s consent,approval, execution, or acknowledgment. 55. Change in Law;Governmental Actions;Termination Option: In the event that (i) Tenant’s Agreed Use of the Premises becomes unlawful due to a change in applicable requirements or local law, (ii) Tenant’s Licenses are terminated orthere is a change in status that preventsTenant's operations in the Premises, or (iii)either Tenant or Landlord receives a cease anddesist letter from the U.S. Department of Justice, the City of Fresno or any other governmental entity declaring Tenant’s use of the Premises is in violation of law (a “Governmental Enforcement Action”) andrequiring that Tenant cease operations as a commercial cannabis and delivery business or otherwise threatening legal action against Tenant or Landlord, then either party may terminate this Lease upon thirty-days written notice.In such event,Tenant shall vacate the Premises as soon as is reasonably practicable and, in any event,not later than sixty (60) days after Tenant or Landlord delivers such termination notice.Upon such termination,(i)as a termination fee, Lessee shall pay toLessor the sum equal tothe three (3) months preceding base rent,in addition to last month rent (ii) Landlord shall return the Security Deposit in accordance with applicable law;and (iii) neither Party shall otherwise have any further obligations to the other, except that Tenant must return the Premises to the state and condition in which they were received. 56.Assignment: Notwithstanding Paragraph 12 Assignment and Subletting, Landlord acknowledges that Tenant may wish toassign this Lease to one of itsrelated entities and agrees that such consent shall not be unreasonably withheld. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2017AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM OE­6.02, Revised06­10­2019 Page 1 of 2 OPTION(S) TO EXTEND STANDARD LEASE ADDENDUM Dated:12/2/2020 By and Between Lessor:R&R Real Properties, Inc Lessee:Responsible and Compliant Retail Blackstone, LLC, dba Embarc Fresno Property Address:4592 N Blackstone Ave #103, Fresno, CA 93726 (street address,city,state,zip) Paragraph:57 A. OPTION(S)TO EXTEND: Lessorhereby grantsto LesseetheopƟon toextend theterm ofthisLease for four (4)addiƟonal sixty (60)month period(s) commencing when the priorterm expires upon each andall ofthe following terms and condiƟons: (i) Inorder toexercise anopƟon toextend, Lessee mustgive wriƩennoƟceof suchelecƟon toLessorand Lessormust receivethe sameatleast three (3)but not more than six (6)months priorto thedatethat theopƟon period would commence,Ɵmebeing ofthe essence. If proper noƟficaƟon of the exercise ofan opƟon is not given and/or received,such opƟon shallautomaƟcally expire. OpƟons (ifthere aremore than one)may onlybe exercised consecuƟvely. (ii) Theprovisions of paragraph 39,including those relaƟng to Lessee's Default set forth in paragraph 39.4 of this Lease,are condiƟons of this OpƟon. (iii) Except for theprovisions ofthis LeasegranƟng an opƟon or opƟons to extend theterm,allof theterms and condiƟons of this Leaseexcept where specificallymodified bythis opƟonshallapply. (iv) This OpƟon is personal to the originalLessee,and cannot be assigned or exercised byanyone other than said originalLessee and only whilethe original Lesseeis infull possession ofthe Premises and without the intenƟonofthereaŌer assigningor subleƫng. (v) Themonthly rent for each month of the opƟon period shallbe calculated as follows,using the method(s) indicated below: (CheckMethod(s) tobe Usedand Fill inAppropriately) I. Cost ofLiving Adjustment(s)(COLA) a. On (FillinCOLA Dates): theBase Rentshallbe adjusted by thechange, if any,from theBaseMonth specifiedbelow, inthe Consumer Price Index of theBureau ofLabor StaƟsƟcs ofthe U.S.Department ofLaborfor (selectone): CPIW(Urban WageEarners andClericalWorkers) or CPI U(All Urban Consumers), for (Fillin UrbanArea): . All Items(1982­1984 =100),herein referredto as"CPI". b. Themonthly BaseRent payable in accordance with paragraph A.I.a. ofthis Addendum shall be calculated as follows: the Base Rent set forth in paragraph 1.5of theaƩached Lease,shallbe mulƟplied by afracƟon thenumerator of whichshall betheCPI ofthe calendar month2 monthsprior tothe month(s)specifiedin paragraph A.I.a. aboveduring which theadjustment is to take effect,and the denominator ofwhich shallbe the CPIof the calendar month which is 2months prior to (selectone): thefirst monthofthe termof thisLease assetforth inparagraph 1.3("BaseMonth") or (Fill inOther "BaseMonth"): . The sum socalculated shall consƟtute the new monthly BaseRent hereunder, but inno event, shallany suchnew monthly BaseRent be lessthan the Base Rentpayable forthe month immediately preceding the rent adjustment. c. Inthe eventthecompilaƟon and/or publicaƟon oftheCPI shall be transferred to anyothergovernmental departmentor bureau oragency orshall be disconƟnued,then theindex most nearlythe sameas theCPIshallbeused to make such calculaƟon.In the event that the ParƟes cannot agreeon such alternaƟve index, then themaƩer shallbesubmiƩed fordecision tothe AmericanArbitraƟonAssociaƟon inaccordance withthethen rulesof saidAssociaƟonand thedecision ofthe arbitrators shall bebinding upon theparƟes. The cost ofsaid ArbitraƟon shall bepaid equally by the ParƟes. II. Market RentalValue Adjustment(s)(MRV) a. On (FillinMRV Adjustment Date(s)) the BaseRentshall beadjusted tothe "Market RentalValue" oftheproperty asfollows: 1) Four monthsprior to eachMarket RentalValue Adjustment Date described above, the ParƟes shall aƩemptto agree upon what the new MRV willbe on the adjustment date. Ifagreement cannot be reached,within thirtydays,then: (a) Lessor andLessee shallimmediatelyappoint amutually acceptableappraiser orbroker to establishthe new MRVwithin thenext 30days. Any associated costs willbe split equally between theParƟes,or (b) BothLessor andLessee shalleachimmediately makea reasonable determinaƟon of theMRV andsubmit suchdeterminaƟon, in wriƟng,to arbitraƟon in accordance with thefollowing provisions: DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2017AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM OE­6.02, Revised06­10­2019 Page 2 of 2 (i) Within 15 days thereaŌer, Lessorand Lesseeshalleach selectan independent thirdparty appraiseror broker ("Consultant" ­ checkone) oftheir choicetoact asan arbitrator(Note: theparƟes may notselect eitherofthe Brokersthat wasinvolvedin negoƟaƟng the Lease). Thetwo arbitrators so appointed shall immediatelyselect athird mutually acceptableConsultant to act as athird arbitrator. (ii) The3arbitrators shallwithin 30days oftheappointment ofthe third arbitratorreach adecision astowhat theactual MRVfor the Premises is,and whether Lessor's or Lessee's submiƩed MRV is the closest thereto. Thedecision ofamajority ofthe arbitrators shall be binding on theParƟes. The submiƩed MRV whichis determined to be the closest to the actualMRVshall thereaŌer be usedbythe ParƟes. (iii) If either ofthe ParƟes fails to appoint an arbitrator within thespecified 15 days,the arbitrator Ɵmely appointed byone ofthem shallreach adecision onhis orherown, and said decision shall bebinding on theParƟes. (iv) The enƟrecost of such arbitraƟon shallbe paid bythe partywhose submiƩed MRV is not selected,ie.the one that is NOTthe closest to the actual MRV. 2) When determining MRV,theLessor,Lessee and Consultants shallconsider the terms of comparablemarket transacƟons which shall include,but not limitedto, rent,rental adjustments,abatedrent, leaseterm andfinancialcondiƟonoftenants. 3) Notwithstanding theforegoing,thenew Base Rent shall not be less than the rent payable for themonth immediatelypreceding the rent adjustment. b. Uponthe establishmentofeach NewMarket RentalValue: 1) the new MRV willbecomethe new "Base Rent"for the purpose of calculaƟng any further Adjustments,and 2) the firstmonth ofeachMarket RentalValue termshallbecome thenew "Base Month" forthepurpose ofcalculaƟng anyfurtherAdjustments. III. FixedRentalAdjustment(s) (FRA) TheBase Rentshall beincreased to thefollowing amountson thedatesset forthbelow: On (Fill in FRA Adjustment Date(s)): TheNew BaseRent shallbe: IV. IniƟalTerm Adjustments Theformula used to calculate adjustments to theBaseRateduring theoriginal Termof theLeaseshall conƟnue to be used during theextended term. B. NOTICE: Unless specified otherwise herein,noƟceofany rentaladjustments,other than Fixed Rental Adjustments,shallbe madeas specified in paragraph 23ofthe Lease. C. BROKER'SFEE: The Brokers shallbe paid a Brokerage Fee for each adjustment specified abovein accordance with paragraph 15 of the Lease or ifapplicable,paragraph 9ofthe Sublease.Broker shall only receive afee for the first (1st) renewal option AIR CRE * hƩps://www.aircre.com * 213­687­8777 * contracts@aircre.com NOTICE:Nopart of theseworks may be reproduced in any form without permission in wriƟng. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2017AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM GR­3.22, Revised06­10­2019 Page 1of 2 GUARANTY OF LEASE WHEREAS,R&R Real Properties, Inc , hereinaŌer "Lessor", and Responsible and Compliant Retail Blackstone, LLC, dba Embarc Fresno ,hereinaŌer "Lessee", areabout toexecute a documentenƟtled "Lease"dated 12/2/2020 concerning the premisescommonly knownas(street address, city, state,zip)4592 N Blackstone Ave #103, Fresno, CA 93726 wherein Lessor willlease thepremises to Lessee,and WHEREAS,Consolidated Commercial Holdings, LLC, a California Limited Liabiltiy Company hereinaŌer "Guarantors" have a financial interest in Lessee, and WHEREAS,Lessor would not execute theLease ifGuarantors did not execute and deliver to Lessor thisGuarantyof Lease. NOWTHEREFORE, inconsideraƟon ofthe execuƟon ofsaid Leaseby Lessorand asamaterialinducementtoLessortoexecutesaidLease,Guarantorshereby jointly,severally,uncondiƟonally and irrevocably guarantee the prompt payment byLessee ofallrents and all other sums payable byLessee under said Lease and the faithfuland promptperformance byLesseeof eachand everyone oftheterms, condiƟons and covenantsofsaid Leaseto bekeptand performed by Lessee. It is specificallyagreed byLessor and Guarantors that: (i)the terms ofthe foregoing Lease maybemodified byagreement between Lessor and Lessee,or bya course of conduct, and (ii)saidLease maybe assignedby Lessororany assignee of Lessorwithout the consent of ornoƟce to Guarantors and thatthis Guarantyshall guaranteethe performance of said Leaseas so modified. ThisGuaranty shallnot bereleased, modified oraffected bythe failureordelay onthe part ofLessor to enforce anyofthe rightsor remediesof theLessorunder said Lease. NonoƟce ofdefault byLesseeunder theLease needbe givenbyLessor toGuarantors, itbeing specifically agreed that theguaranteeof theundersigned isa conƟnuing guarantee under which Lessor mayproceed immediatelyagainst Lesseeand/or against Guarantors following anybreach or default by Lesseeor for the enforcementof anyrights which Lessormay have as againstLessee under the terms ofthe Leaseorat lawor inequity. Lessor shall have the right to proceed against Guarantors following any breach or default by Lessee under theLease without first proceeding against Lessee and without previous noƟce to ordemand upon eitherLessee orGuarantors. Guarantors hereby waive(a) noƟceofacceptance ofthis Guaranty.(b) demand ofpayment,presentaƟon and protest,(c)all right to assert or plead anystatute oflimitaƟons relaƟng to this Guarantyor theLease, (d)any rightto require theLessor toproceedagainst theLessee oranyother Guarantoror anyotherpersonor enƟtyliable to Lessor,(e)anyright to require Lessor to applyto any default any securitydeposit or other security it mayhold under the Lease,(f) anyright to require Lessorto proceed under anyotherremedy Lessormay have before proceeding againstGuarantors, (g)any rightofsubrogaƟon thatGuarantors mayhaveagainst Lessee. Guarantors do hereby subordinate allexisƟng or future indebtedness ofLessee to Guarantors to the obligaƟons owedto Lessor under the Leaseand this Guaranty. Ifa Guarantoris married,suchGuarantor expressly agrees thatrecourse may be had against his orher separate property for allofthe obligaƟons hereunder. TheobligaƟons ofLessee under the Lease to execute and deliver estoppel statements and financialstatements,as therein provided,shallbe deemed to also require the Guarantors to provide estoppel statements andfinancial statementsto Lessor. The failureof theGuarantors to provide the sametoLessor shallconsƟtute adefault under the Lease. Theterm "Lessor"refers toandmeans theLessor namedin theLeaseand alsoLessor's successorsandassigns. So longasLessor's interestin theLease,the leased premises or the rents,issues and profits therefrom,aresubject to anymortgage or deed oftrust or assignment for security,no acquisiƟon byGuarantors ofthe Lessor's interest shall affect theconƟnuing obligaƟon ofGuarantors under this Guarantywhichshall nevertheless conƟnue infullforce andeffect forthe benefit ofthe mortgagee,beneficiary,trusteeor assigneeunder such mortgage,deed oftrust or assignment and their successors and assigns. Theterm "Lessee"refers toandmeans theLessee namedin theLeaseand alsoLessee's successors andassigns. Anyrecovery byLessor from anyother guarantoror insurer shall firstbecredited tothe porƟonofLessee's indebtedness to Lessorwhichexceeds themaximum liabilityof Guarantors under this Guaranty. Noprovision ofthis Guarantyorright ofthe Lessorcan be waived, nor canthe Guarantors bereleased fromtheir obligaƟons exceptin wriƟng signed bythe Lessor. AnyliƟgaƟon concerning this Guarantyshallbe iniƟated in astate courtof competent jurisdicƟonin thecountyin whichthe leasedpremisesare locatedand the Guarantors consent to the jurisdicƟon ofsuch court. This Guaranty shallbegoverned bythe laws ofthe State in which theleased premises are located and for the purposes of anyrules regarding conflicts of law the parƟes shall be treated as ifthey wereallresidents ordomiciles ofsuchState. In the event any acƟon bebrought bysaid Lessor against Guarantors hereunder to enforcethe obligaƟon ofGuarantors hereunder,the unsuccessful partyin such acƟon shall pay to theprevailing partytherein areasonable aƩorney's fee. The aƩorney's feeaward shall notbe computed inaccordance withany court fee schedule,but shallbe such as to fullreimburse allaƩorneys'fees reasonablyincurred. Ifany Guarantoris acorporaƟon, partnership, orlimited liabilitycompany, eachindividual execuƟng this Guaranty onsaidenƟty's behalf represents and warrants that he or sheis duly authorized to execute this Guarantyon behalf ofsuch enƟty. Signatures to this Guarantyaccomplished by means of electronic signature or similartechnology shallbelegal andbinding. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2017AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM GR­3.22, Revised06­10­2019 Page 2of 2 If this Form has been filled in, it has been prepared for submission to your aƩorney for hisapproval.No representaƟon or recommendaƟon ismade BY AIR CRE, thereal estatebroker oritsagents oremployees asto thelegalsufficiency,legaleffect, ortaxconsequences ofthis Formorthe transacƟonrelaƟng thereto. GUARANTORS Consolidated Commercial Holdings, LLC, a California Limited Liabiltiy Company ExecutedAt: On: By: NamePrinted: Title: Address: By: NamePrinted: Title: Address: AIR CRE * hƩps://www.aircre.com * 213­687­8777 * contracts@aircre.com NOTICE:Nopart of theseworks may be reproduced in any form without permission in wriƟng. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 Authorized Signatory 1201 K St., Suite 920 Sacramento, CA 95814 Dustin Moore ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM AD­3.01, Revised06­10­2019 Page1 of 4 DISCLOSURE REGARDING REALESTATE AGENCY RELATIONSHIP (Asrequired by the Civil Code) Whenyou enterinto adiscussionwith areal estateagent regarding areal estatetransacƟon, youshould from theoutset understand whattype of agency relaƟonship or representaƟon you wish to have with theagent in the transacƟon. SELLER'SAGENT ASeller's agent under alisƟng agreement with the Seller acts as theagent for the Seller only. ASeller's agent or asubagent of that agent has thefollowing affirmaƟve obligaƟons: To the Seller:A fiduciary dutyof utmost care,integrity,honesty and loyaltyin dealings with theSeller. Tothe Buyer and the Seller: (a) Diligent exerciseof reasonable skilland care in performance of theagent's duƟes. (b) A duty ofhonest and fairdealing andgood faith. (c) Aduty to disclose allfacts known to the agent materially affecƟng thevalue or desirability ofthe property that are not known to,or within thediligent aƩenƟon andobservaƟon of,the parƟes. An agent is not obligated to reveal to either partyany confidenƟalinformaƟon obtained from the other party that does not involvetheaffirmaƟve duƟes set forth above. BUYER'SAGENT ABuyer's agentcan, withaBuyer's consent,agree toact asagentfor theBuyer only. In thesesituaƟons, theagentis notthe Seller'sagent, even ifby agreementthe agent may receivecompensaƟon for services rendered,either in full or in part from the Seller. Anagent acƟng only for aBuyer has the following affirmaƟve obligaƟons: To the Buyer:A fiduciary duty of utmost care,integrity,honesty and loyaltyin dealings with theBuyer. Tothe Buyer and the Seller: (a) Diligent exerciseof reasonable skilland care in performance of theagent's duƟes. (b) A duty ofhonest and fairdealing andgood faith. (c) Aduty to disclose allfacts known to the agent materially affecƟng thevalue or desirability ofthe property that are not known to,or within thediligent aƩenƟonand observaƟonof, theparƟes. An agent is not obligated to reveal to either partyany confidenƟalinformaƟon obtained from the other party that does not involvetheaffirmaƟve duƟes set forth above. AGENT REPRESENTING BOTHSELLER ANDBUYER Areal estateagent, either acƟng directly orthrough oneor moresalespersonand brokerassociates, canlegallybe theagent ofboththe Sellerand the Buyer ina transacƟon,but onlywith theknowledge and consent of both the Seller and the Buyer. Ina dual agency situaƟon,theagent has the following affirmaƟve obligaƟons toboth theSeller andtheBuyer: (a) A fiduciary duty ofutmost care,integrity,honesty and loyalty in thedealings with either theSeller or theBuyer. (b) OtherduƟes tothe Sellerandthe Buyeras statedabovein their respecƟvesecƟons. In represenƟng both Seller and Buyer,a dual agent maynot,without theexpress permission of the respecƟve party,discloseto the other party confidenƟal informaƟon,including, butnot limitedto,facts relaƟngto eitherthe Buyer’s orSeller’s financial posiƟon, moƟvaƟons,bargaining posiƟon, orother personal informaƟon that mayimpact price,including the Seller’s willingness to accept apriceless than the lisƟng priceor theBuyer’s willingness to pay aprice greater than the price offered. SELLER AND BUYER RESPONSIBILITIES Eitherthe purchase agreement oraseparate documentwill containa confirmaƟonofwhich agentis represenƟngyouand whether that agentisrepresenƟngyou exclusively in thetransacƟon or acƟng as adual agent. PleasepayaƩenƟon to that confirmaƟon to make sureit accurately reflects your understanding of your agent’s role. The above duƟes of the agent in a real estate transacƟon do not relieve aSelleror Buyerfrom theresponsibility to protecthis orher owninterests. You should carefully read allagreements to assure that theyadequately express your understanding ofthe transacƟon. Arealestate agent is aperson qualified to advise about realestate. If legalortax adviceis desired, consult acompetentprofessional. If youare a Buyer, you have the duty to exercise reasonable care to protect yourself, including as to those facts about the propertywhich areknown to you or within your diligent aƩenƟon and observaƟon. Both Sellers and Buyers should strongly consider obtaining tax advice from a competent professional because the federal and state tax consequences of atransacƟon can be complex and subject to change. Throughout your real property transacƟonyoumay receive more than one disclosure form,depending upon the number ofagents assisƟngin thetransacƟon. The law requires each agent with whomyou have more than acasualrelaƟonshipto present you with this disclosure form. You should read its contents each Ɵme it is presented to you,considering therelaƟonship between youand thereal estate agentin yourspecific transacƟon.This disclosureform includestheprovisions of SecƟons2079.13 to2079.24, inclusive,of the Civil Code set forth on page2.Read it carefully.I/WE ACKNOWLEDGERECEIPT OF ACOPY OF THIS DISCLOSUREAND THEPORTIONS OFTHE CIVILCODEPRINTED ONTHE BACK(OR ASEPARATEPAGE). Buyer Seller Lessor Lessee Date: Buyer Seller Lessor Lessee Date: Agent:Colliers Tingey International , Inc.DRELic.#:00452468 Real Estate Broker (Firm) By:DRELic. #:01902869 Date: Zack Kaufman (Salesperson or Broker­Associate) DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM AD­3.01, Revised06­10­2019 Page2 of 4 THISFORM HASBEEN PREPAREDBYAIR CRE. NO REPRESENTATION ISMADEAS TO THE LEGALVALIDITYOR ADEQUACYOF THISFORM FOR ANYSPECIFIC TRANSACTION. PLEASESEEK LEGALCOUNSELAS TOTHE APPROPRIATENESSOF THISFORM. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM AD­3.01, Revised06­10­2019 Page3 of 4 DISCLOSURE REGARDING REAL ESTATE AGENCY RELATIONSHIP CIVIL CODE SECTIONS 2079.13 THROUGH 2079.24 (2079.16 APPEARS ON THE FRONT) 2079.13.As usedin SecƟons2079.7and 2079.14to 2079.24,inclusive, thefollowing terms have the following meanings: (a)“Agent” mean s aperson acƟng under provisions ofTitle 9 (commencing with SecƟon 2295)in a real property transacƟon,and includes aperson who is licensed as a realestate broker under Chapter 3 (commencing withSecƟon 10130) ofPart 1 ofDivision 4 ofthe Business and ProfessionsCode, and under whose license alisƟng is executed or an offer to purchase is obtained. The agent in the real property transacƟon bears responsibility for that agent’s salespersons or broker associates who perform asagents ofthe agent.When asalesperson orbroker associateowes aduty toany principal,or toany buyer or sellerwho isnot aprincipal, ina realproperty transacƟon,that duty is equivalent to the duty owed to that party by the broker for whom the salesperson or broker associate funcƟons.(b)“Buyer” means a transferee in a real property transacƟon, and includes a person who executes an offer to purchase real property from a seller through an agent, or who seeks the services of an agent in more than acasual,transitory,or preliminary manner,with theobject of entering into a real property transacƟon. “Buyer” includes vendee or lessee of real property.(c)“Commercial real property” means all real property in the state, except (1) single­family residenƟal real property, (2) dwelling units made subject to Chapter 2(commencing with SecƟon 1940) ofTitle 5,(3) amobilehome,as defined inSecƟon 798.3,(4) vacant land,or (5) arecreaƟonal vehicle,as defined in SecƟon799.29.(d)“Dual agent” means anagent acƟng, eitherdirectly or through a salesperson orbroker associate, as agent for both the seller and the buyer ina real propertytransacƟon.(e)“LisƟng agreement”means awriƩen contract between aseller ofreal property and an agent,by which the agent has been authorized to sellthe realproperty orto find orobtain abuyer, including rendering otherservicesfor which a real estate licenseisrequired to the sellerpursuanttothetermsofthe agreement.(f)“Seller’s agent” means aperson who has obtained a lisƟng of real property to act as an agent for compensaƟon.(g)“LisƟng price” is the amount expressed in dollars specified in the lisƟng for which the seller is willing to sell the real property through the seller’s agent.(h)“Offering price” is the amount expressed in dollars specified in an offer to purchase for which the buyer is willing to buy thereal property.(i)“Offer to purchase” means awriƩen contract executed by a buyer acƟng through a buyer’s agent that becomes the contract for the sale of the real property upon acceptance by the seller.(j)“Real property” means any estate specified by subdivision (1) or (2) of SecƟon 761 in property,and includes (1) single­family residenƟal property,(2) mulƟunit residenƟal property with more than four dwelling units, (3) commercial real property, (4) vacant land, (5) a ground lease coupled with improvements, or (6) a manufactured home as defined in SecƟon 18007 of the Health and Safety Code,or a mobilehome as defined in SecƟon 18008 of the Health and Safety Code,when offered for saleor sold through an agent pursuant to the authority contained in SecƟon10131.6 ofthe Businessand Professions Code.(k)“Real propertytransacƟon” meansa transacƟonfor thesale of real property in which an agent is retained by a buyer,seller,or both a buyer and seller to act in that transacƟon,and includes alisƟng or an offer to purchase.(l) “Sell,” “sale,” or “sold” refers to a transacƟon for the transfer of real property fromthe seller to thebuyer and includes exchanges of realproperty between the seller and buyer,transacƟons for the creaƟon of a real property sales contract within the meaning of SecƟon 2985,and transacƟons for the creaƟon of a leasehold exceeding one year’sduraƟon.(m)“Seller” means thetransferor in a realproperty transacƟon and includes anowner who lists real property with an agent, whether or not atransfer results,or who receives an offer to purchase real property of which he or she is theowner from an agent on behalfof another.“Seller” includes both avendor anda lessorofreal property.(n)“Buyer’s agent” meansanagent whorepresents abuyer in areal property transacƟon. 2079.14. A seller’s agent and buyer’s agent shall provide the seller and buyer in a real property transacƟon with a copy of the disclosure form specified in SecƟon 2079.16,and shall obtain asigned acknowledgment of receipt from that seller and buyer,except as provided in SecƟon 2079.15,as follows:(a)The seller’s agent,if any, shallprovide the disclosure formto the seller priorto entering into thelisƟng agreement.(b)The buyer’s agent shall provide the disclosure form to the buyer as soonas pracƟcable prior to execuƟon ofthe buyer’s offerto purchase. If the offer to purchase isnot prepared bythe buyer’s agent, the buyer’s agentshall presentthe disclosure form to the buyer not later than the next business day aŌer receiving theoffer to purchase from the buyer. 2079.15.In any circumstance in which the seller or buyer refuses to sign an acknowledgment of receipt pursuant to SecƟon 2079.14,the agent shall set forth,sign, anddate awriƩen declaraƟonofthe factsof therefusal. 2079.16 Reproducedon Page1 ofthis ADform. 2079.17(a)As soon as pracƟcable,the buyer’s agent shall disclose to the buyer and seller whether the agent is acƟng in the real property transacƟon as the buyer’s agent, or as a dual agent represenƟng both the buyer and the seller. This relaƟonship shall be confirmed in the contract to purchase and sell real property or in a separate wriƟng executed or acknowledged bythe seller,the buyer,and the buyer’s agent prior to or coincident with execuƟon of that contract by the buyer and the seller, respecƟvely.(b)As soon as pracƟcable, the seller’sagent shall disclose to the seller whether the seller’s agent is acƟng in the real property transacƟon as the seller’s agent, oras a dual agentrepresenƟng both the buyer and seller. This relaƟonship shallbe confirmed in the contractto purchase and sellreal property or in a separatewriƟng executed or acknowledged bythe seller and theseller’s agent prior to or coincidentwith theexecuƟon ofthat contract bythe seller. (C)CONFIRMATION: The following agencyrelaƟonships are confirmedfor this transacƟon. Seller’s Brokerage Firm DO NOT COMPLETE, SAMPLE ONLY License Number Is the broker of (check one):†the seller; or †both the buyer and seller. (dual agent) Seller’s Agent DO NOT COMPLETE, SAMPLE ONLY License Number Is (check one):†the Seller’s Agent. (salesperson or broker associate); or †both the Buyer’s Agent and the Seller’s Agent. (dual agent) Buyer’s Brokerage Firm DO NOT COMPLETE, SAMPLE ONLY License Number Is the broker of (check one):†the buyer; or †both the buyer and seller. (dual agent) Buyer’s Agent DO NOT COMPLETE, SAMPLE ONLY License Number Is (check one):†the Buyer’s Agent. (salesperson or broker associate); or †both the Buyer’s Agent and the Seller’s Agent. (dual agent) (d)The disclosures and confirmaƟon required by this secƟon shallbe in addiƟon to thedisclosure required by SecƟon 2079.14.An agent’s duty to provide disclosure andconfirmaƟon ofrepresentaƟon inthissecƟon maybe performed by arealestate salespersonor brokerassociateaffiliated withthat broker. 2079.18 (Repealed pursuant to AB­1289,2017­18California LegislaƟvesession) 2079.19 The payment of compensaƟon or the obligaƟon to pay compensaƟon to an agent bythe seller or buyer is not necessarilydeterminaƟve of aparƟcular agency relaƟonship between anagent and the seller orbuyer. AlisƟng agentand a sellingagent mayagreeto share any compensaƟon orcommission paid, or anyright toany compensaƟon or commission for which an obligaƟon arises as theresult ofareal estatetransacƟon,and theterms ofany such agreement shall not necessarily be determinaƟve of aparƟcular relaƟonship. 2079.20 Nothing in this arƟcleprevents an agent from selecƟng,as acondiƟon of theagent’s employment,aspecific formof agencyrelaƟonship not specifically DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2019AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM AD­3.01, Revised06­10­2019 Page4 of 4 prohibited by this arƟcle iftherequirements ofSecƟon 2079.14 and SecƟon 2079.17 are complied with. 2079.21 (a)Adualagent maynot,without the express permission oftheseller,disclose to thebuyer any confidenƟalinformaƟon obtained from the seller.(b)Adual agentmay not,without theexpress permission ofthe buyer, disclose tothe seller anyconfidenƟal informaƟonobtained from the buyer.(c)“ConfidenƟalinformaƟon” means facts relaƟng to theclient’s financial posiƟon,moƟvaƟons,bargaining posiƟon,or other personal informaƟon that mayimpact price,such as theseller is willing toaccept aprice lessthanthe lisƟngprice orthe buyeriswilling topay apricegreater thanthe priceoffered.(d)This secƟon does not alterinany waythe duty or responsibility of adual agent to any principal with respect to confidenƟal informaƟon other than price. 2079.22 Nothing inthis arƟcleprecludes a seller’sagent from also being abuyer’s agent.If aselleror buyer in atransacƟon chooses to not be represented by an agent,that does not,ofitself,make that agent adual agent. 2079.23(a)Acontract between theprincipal and agent maybe modified or altered to change theagencyrelaƟonship at any Ɵmebefore the performance of theact which is theobject oftheagency withthe wriƩen consent oftheparƟes to the agencyrelaƟonship.(b)A lender oran aucƟon company retained by alender to control aspects ofa transacƟon ofreal property subject to this part,including validaƟng thesales price,shallnot require,as acondiƟon of receiving the lender’s approvalof thetransacƟon, thehomeowner or lisƟngagent todefend orindemnify the lender or aucƟoncompanyfrom anyliability allegedtoresult from the acƟons ofthe lender or aucƟon company.Any clause,provision,covenant,or agreement purporƟng to imposean obligaƟon to defend or indemnify alender or an aucƟon companyin violaƟonof thissubdivision is againstpublic policy,void, andunenforceable. 2079.24 Nothing in this arƟcleshallbe construed to either diminish thedutyof disclosure owed buyers and sellers by agents and their associate licensees,subagents, andemployees orto relieve agentsand theirassociate licensees,subagents, andemployeesfrom liabilityfor theirconduct in connecƟon with actsgoverned by this arƟcleor for any breach ofa fiduciary duty or a dutyofdisclosure. AIR CRE * hƩps://www.aircre.com * 213­687­8777 * contracts@aircre.com NOTICE:Nopart of theseworks may be reproduced in any form without permission in wriƟng. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2017AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM ARB­3.03, Revised06­10­2019 Page 1 of2 ARBITRATION AGREEMENT STANDARD LEASE ADDENDUM Dated:12/2/2020 By and Between Lessor:R&R Real Properties, Inc Lessee:Responsible and Compliant Retail Blackstone, LLC, dba Embarc Fresno Property Address:4592 N Blackstone Ave #103, Fresno, CA 93726 (street address,city,state,zip) Paragraph:58 A.ARBITRATION OFDISPUTES: Except as provided in Paragraph Bbelow,theParƟes agreeto resolve any and allclaims,disputes or disagreements arising under this Lease,including,but not limited to any maƩerrelaƟng to Lessor'sfailure to approve anassignment, sublease orother transferof Lessee'sinterestin theLease under Paragraph12 ofthis Lease,any other defaults byLessor,or anydefaults byLessee byand through arbitraƟon as provided below andirrevocably waive anyand allrights to thecontrary. The ParƟes agreeto atall Ɵmesconduct themselves instrict, full,complete andƟmely accordance with the terms hereof and that any aƩempt to circumvent the termsofthis ArbitraƟon Agreement shallbe absolutely null and void and ofno force or effect whatsoever. B.DISPUTESEXCLUDEDFROM ARBITRATION: Thefollowing claims,disputes or disagreements under this Lease areexpressly excluded fromthe arbitraƟon procedures set forth herein: 1.Disputes for which a different resoluƟon determinaƟon is specifically setforth inthis Lease,2. Allclaimsby eitherparty which(a)seek anythingother thanenforcement or determinaƟon ofrights under this Lease,or (b) areprimarily founded upon maƩers offraud,willfulmisconduct,bad faith or anyother allegaƟons oftorƟous acƟon,and seekthe award of puniƟve or exemplarydamages,3. ClaimsrelaƟng to(a) Lessor's exerciseof anyunlawful detainer rightspursuant to applicable lawor(b) rightsor remedies used by Lessor to gain possession of thePremises or terminate Lessee's right of possession to thePremises,all ofwhich disputes shallbe resolved by suit filed in the applicable court ofjurisdicƟon, thedecisionof which court shall be subject to appeal pursuant to applicable law4. Anyclaim ordispute that iswithin thejurisdicƟon ofthe SmallClaims Court and 5. Allclaims arising under Paragraph 39 of this Lease. C.APPOINTMENTOFAN ARBITRATOR: Alldisputes subject to this ArbitraƟonAgreement, shall be determined by binding arbitraƟon before: areƟred judge ofthe applicable court ofjurisdicƟon(e.g., the Superior Courtof theStateof California) affiliated withJudicial ArbitraƟon&MediaƟon Services,Inc. ("JAMS"), theAmerican ArbitraƟonAssociaƟon ("AAA") underits commercialarbitraƟon rules,Panel Member from Judicate West , orasmay beotherwise mutually agreedby Lessorand Lessee(the "Arbitrator"). In the event that the parƟes elect to use an arbitrator other than oneaffiliated with JAMS or AAAthen such arbitrator shallbe obligated to complywith theCode ofEthicsfor Arbitratorsin CommercialDisputes (see:hƩp://www.adr.org/aaa/ShowProperty?nodeId=/UCM/ADRSTG_003867).Such arbitraƟon shall beiniƟated bythe ParƟes,or either ofthem,within ten (10) days aŌer either party sends wriƩen noƟce (the "ArbitraƟon NoƟce") ofa demand to arbitrateby registered or cerƟfiedmailto theother partyand totheArbitrator. The ArbitraƟonNoƟceshall containa descripƟonofthe subject maƩer ofthe arbitraƟon,the dispute with respect thereto,the amount involved,ifany,and theremedy or determinaƟon sought. If theParƟes have agreed to use JAMS they may agree on areƟred judge fromthe JAMS panel. If they are unable to agree within tendays, JAMSwill provide alist ofthree available judges and eachparty maystrike one. Theremaining judge (or if there are two,the oneselected by JAMS)will serveas the Arbitrator. Ifthe ParƟes have elected to uƟlize AAAor some other organizaƟon, the Arbitratorshall be selected in accordance with saidorganizaƟon's rules. In theevent theArbitratoris notselected asprovided for abovefor any reason,the partyiniƟaƟng arbitraƟon shallapply to the appropriate Court for theappointment ofa qualified reƟred judge to act as theArbitrator. D.ARBITRATION PROCEDURE: 1.PRE­HEARINGACTIONS. The Arbitrator shallschedule apre­hearing conference to resolve proceduralmaƩers,arrange for the exchange of informaƟon, obtain sƟpulaƟons, and narrow the issues. The ParƟes willsubmit proposed discovery schedules to the Arbitrator atthe pre­hearing conference. The scope and duraƟon of discovery will bewithin the solediscreƟon of the Arbitrator. The Arbitrator shall have the discreƟon to order apre­hearing exchange of informaƟon bythe ParƟes,including, without limitaƟon, producƟon ofrequested documents,exchange ofsummaries oftesƟmonyof proposed witnesses, and examinaƟon by deposiƟon ofparƟes and third­party witnesses. This discreƟon shall beexercised in favor of discovery reasonable under the circumstances. The Arbitrator shallissue subpoenas andsubpoenas duces tecum asprovided for inthe applicable statutory orcaselaw (e.g.,in CaliforniaCodeof CivilProcedure SecƟon1282.6). 2.THE DECISION. The arbitraƟonshall be conducted in the cityor countywithin whichthePremises arelocated ata mutually agreeable reasonably convenient site within the City or County or any other County,soagreed upon by the Parties.AnyParty maybe represented by counsel orother authorized representaƟve. In rendering adecision(s), the Arbitrator shall determine the rightsand obligaƟonsofthe ParƟes according to thesubstanƟve laws and the terms and provisions of this Lease. TheArbitrator's decision shallbe based on theevidence introduced at the hearing, including all logicaland reasonable inferencestherefrom. The Arbitratormay makeanydeterminaƟon and/orgrant anyremedyor reliefthat isjustand equitable. Thedecision must be based on,and accompanied by,awriƩen statement ofdecision explaining the factualand legal basis for thedecision as to each ofthe principal controverted issues. The decision shallbe conclusive and binding, and it maythereaŌer be confirmed asajudgment bythe court ofapplicable jurisdicƟon, subject DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________ ________ ________ ________ INITIALS INITIALS © 2017AIR CRE. AllRights Reserved. Last Edited: 12/2/2020 9:55AM ARB­3.03, Revised06­10­2019 Page 2 of2 onlyto challenge on thegrounds set forth in theapplicable statutory or case law (e.g., in CaliforniaCode ofCivil Procedure SecƟon 1286.2). The validityand enforceability of theArbitrator's decisionisto bedetermined exclusively by thecourt of appropriatejurisdicƟon pursuant to the provisions of thisLease. The Arbitrator may award costs,including without limitaƟon,Arbitrator's fees and costs,aƩorneys'fees,and expert and witness costs,to theprevailing party,ifany,as determined by the Arbitrator inhis discreƟon. Whenever amaƩer which has been submiƩed to arbitraƟon involves a dispute as to whether or not aparƟcular act or omission (other than afailure to pay money) consƟtutes aDefault, theƟmeto commenceor ceasesuch acƟonshallbe tolledfrom thedatethat theNoƟce ofArbitraƟonis servedthrough andunƟlthe date the Arbitrator renders his or her decision. Provided,however,that this provision shallNOT applyin the event that theArbitrator determines that the ArbitraƟon NoƟcewas prepared in badfaith. Whenever adisputearises between theParƟes concerning whether or not thefailureto makea paymentofmoney consƟtutes adefault,theservice ofan ArbitraƟon NoƟce shall NOT toll theƟme periodin which to paythemoney. The Partyallegedlyobligated topay themoneymay, however,elect topay themoney "under protest"byaccompanying said payment with awriƩen statement seƫng forth thereasons for such protest. If thereaŌer,the Arbitrator determines that the Partywho receivedsaid money wasnot enƟtledto suchpayment, saidmoneyshall bepromptly returnedtothe Partywho paidsuch money under protest together with Interest thereon as defined in Paragraph 13.5. Ifa Partymakes apayment "under protest"but no NoƟceof ArbitraƟon is filed within thirty days,then such protestshall bedeemed waived. (See alsoParagraph 42or 43) The cost of arbitration shall be shared equally by each party to the arbitration proceeding. AIR CRE * hƩps://www.aircre.com *213­687­8777 * contracts@aircre.com NOTICE: Nopart oftheseworks maybe reproducedin anyformwithout permissionin wriƟng. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 ________________ ________________ INITIALS INITIALS © 2017AIR CRE. AllRights Reserved.Last Edited: 12/2/2020 9:55AM CDM­2.02, Revised06­10­2019 Page 1of 1 RENT COMMENCEMENT DATE MEMORANDUM Date:12/2/2020 By and Between Lessor:R&R Real Properties, Inc Lessee:Responsible and Compliant Retail Blackstone, LLC, dba Embarc Fresno Property Address:4592 N Blackstone Ave #103, Fresno, CA 93726 (street address,city,state,zip) THISMEMORANDUM, madeas of 12/2/2020 by andbetween R&R Real Properties, Inc ("Lessor") and Responsible and Compliant Retail Blackstone, LLC, dba Embarc Fresno ("Lessee"). Recitals: Lessorand Lesseeare parƟestothat certainLease, datedfor reference purposes 12/2/2020 (the"Lease") forcertainpremises (the"Premises") commonly knownas(streetaddress,city,state,zip)4592 N Blackstone Ave #103, Fresno, CA 93726 . Lesseeis nowin possessionofthe Premisesand the Term ofthe Lease hascommenced. Lessor and Lesseedesire to enter into this Memorandum confirming the Commencement Date,the ExpiraƟon Date and other maƩers under the Lease. NOW,THEREFORE, Lessorand Lesseeagreeas follows: 1. Theactual Rent CommencementDateis TBD . 2. Theactual Rent ExpiraƟonDate is TBD . 3. TheBase Rentshall be adjusted on thedates indicated asfollows:(strike ifnot applicable) 4. Other:(strikeif notapplicable) 5. Capitalized terms not defined herein shallhave thesame meaning as set forth in theLease. Signatures to this Memorandum accomplished bymeans of electronicsignature orsimilar technology shall be legaland binding. INWITNESS WHEREOF,the parƟes hereto have caused this Agreement to beexecuted as ofthe date and year first above wriƩen. By Lessor R&R Real Properties, Inc By: NamePrinted:Richard L. Rossen Title:Secretary Phone:559-446-0182 Fax: Email:Bob Mott - bob@northstarmanagement.net (property manager) By: NamePrinted: Title: Phone: Fax: Email: Address:7108 N Fresno St #370, Fresno,CA 93720 Federal ID No.: By Lessee Responsible and Compliant Retail Blackstone, LLC, dba Embarc Fresno By: NamePrinted:Dustin Moore Title:Managing Member Phone: Fax:goembarc.com Email:dustin@goembarc.com By: NamePrinted: Title: Phone: Fax: Email: Address:1201 K Street, Suite #920, Sacramento, CA 95814 Federal ID No.: AIR CRE * hƩps://www.aircre.com * 213­687­8777 * contracts@aircre.com NOTICE:Nopart of theseworks may be reproduced in any form without permission in wriƟng. DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 COMMERCIAL REAL PROPERTY DISCLOSURES (COMMERCIAL LEASE) COLLIERS TINGEY INTERNATIONAL, INC. Property Address: 4592 N Blackstone #103, Fresno, CA 93726 Lessee: Responsible and Compliant Retail Blackstone, LLC dba Embarc Broker: Colliers Tingey International Inc, dba Colliers International The purpose of this document is to explain the limited scope of Colliers Tingey International, Inc.’s (“Colliers Tingey”) duties and responsibilities to Lessee, as well as provide certain disclosures related to this commercial lease transaction: 1. Scope of Duties. Lessee hereby acknowledges and agrees that Colliers Tingey: (i) does not decide what rent Lessee should pay or the rent Lessor should accept as rent for the Property; (ii) does not guarantee the condition of the Property; (iii) does not guarantee the performance, adequacy or completeness of inspections, services, products or repairs provided or made by the Lessor or any other third parties; (iv) does not have an obligation to conduct an inspection of the Property; (v) shall not be responsible for identifying defects on the Property; (vi) shall not be responsible for verifying square footage, representations of others or information contained in investigation reports, advertisements, flyers or other promotional material; (vii) shall not be responsible for providing legal, tax or financial advice regarding any aspect of a transaction entered into by Lessee and the Lessor; and (viii) shall not be responsible for providing other advice or information that exceeds the knowledge, education and experience required to perform real estate licensed activity. Lessee agrees to seek legal, tax, insurance, title, financial and other desired assistance from appropriate professionals. 2. Lessee to Obtain Inspections. Lessee is responsible to have the Property thoroughly inspected and is responsible to ask its experts what investigations and evaluations may be appropriate, as well as the risks of not performing any such investigations or evaluations. 3. Earthquake Safety. Earthquakes occur throughout California. Colliers Tingey owes no duty to inspect for earthquake weaknesses, or geological or seismic hazards. Tenant acknowledges receipt of a copy of “The Commercial Property Owner’s Guide to Earthquake Safety.” Colliers Tingey is not required to provide Lessee with any information concerning earthquake safety or other related issues. Lessee should have its experts confirm whether the Property is in any earthquake zone and otherwise investigate and evaluate these matters. 4. Flood Zones. The Property may or may not be located in a flood zone. Whether or not the Property is located in a flood zone, properties can be subject to flooding and moisture problems, especially properties on a slope or in low-lying areas or in a dam inundation zone. Lessee should have its experts confirm whether the Property is in a flood zone and otherwise investigate and evaluate these matters. 5. Hazardous Materials/Underground Storage Tanks. The Property may have hazardous or undesirable metals (including lead-based paint), minerals (including asbestos), chemicals, hydrocarbons, petroleum-related compounds, or biological or radioactive/emissive items (including electrical and magnetic fields) in soils, water, building components, above or below-ground tanks/containers or elsewhere in areas that may or may not be accessible or noticeable. Such items may leak or otherwise be released. Asbestos has been used in items such as fireproofing, heating/cooling systems, insulation, spray-on and tile acoustical materials, floor tiles and coverings, roofing, drywall and plaster. Lessee should have its experts investigate and evaluate these matters. 6. Fires. The Property may be located within a high fire risk hazard zone or wildland zone that the state does not have responsibility to provide fire protection services to and may contain substantial fire risks. Lessee should have its experts confirm the Property’s fire risks and otherwise investigate and evaluate these matters. 7. Mold. Colliers Tingey is not qualified to advise Lessee on the existence of any mold on or near the Property or the health and safety risks related to mold exposure. Lessee is encouraged to obtain the services of a qualified and experienced professional to conduct inspections and tests regarding any and all DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 mold issues which may affect the Property. Lessee hereby acknowledges and agrees that Colliers Tingey is not responsible for any required remediation and/or any resulting damages related to mold. 8. Zoning/Licenses/Permits. Lessee is solely responsible to ascertain whether the Property is suitable for its intended use and to obtain any necessary permits or licenses related to the Property. Colliers Tingey recommends that Lessee obtain written confirmation regarding the status of the Property from any and all appropriate zoning and licensing agencies. Lessee should have its experts review any and all zoning, licensing and permit issues. 9. Americans with Disabilities Act (ADA). The Americans With Disabilities Act and other federal, state and local requirements may require changes to the Property. Lessee should have its experts investigate and evaluate these matters. 10. Mandatory Accessibility Disclosure for Commercial Leases. Pursuant to California Civil Code Section 1938, each lease or rental agreement for commercial property executed on or after July 1, 2013 must state whether the property being leased or rented has undergone inspection by a Certified Access Specialist (CASp), and, if so, whether the property has or has not been determined to meet all applicable construction- related accessibility standards. Lessee should have its experts investigate and evaluate these matters. 11. Taxes. Sales, leases and other real estate transactions can have federal, state and local tax consequences. Lessee should have its experts investigate and evaluate these matters. 12. Energy Use Disclosure for Commercial Leases. Pursuant to the California Nonresidential Building Energy Use Disclosure Program (AB1103), owners of nonresidential buildings must obtain and disclose, prior to any lease or lease renewal of the entire building, the energy use data for the building for the prior twelve (12) months, together with information regarding the building’s operating characteristics and ENERGY STAR Performance Score. Disclosure is required to be made to the prospective or existing Lessee no later than twenty-four (24) hours prior to the execution of a lease or lease renewal. This disclosure is required for entire buildings with a total gross floor area of Ten Thousand (10,000) square feet or more until December 31, 2015. After that date, AB 1103 has been replaced and there is no statewide energy use disclosure requirement in 2016. This requirement does not apply to leases of less than the entire building. Lessee should have its experts investigate and evaluate these matters. 13. Verify Third Party Information. Any and all information regarding the Property supplied by Colliers Tingey has been received from third party sources and has not been independently verified or analyzed by Colliers Tingey. It is strongly recommended that Lessee and its experts verify and analyze all information regarding the Property, including any linear or area measurements and the availability of all utilities. All work should be inspected and evaluated by Lessee and Lessee’s experts. Colliers Tingey and its brokers are not experts (nor can they determine if any expert is qualified) to provide advice on legal, tax, design, ADA, engineering, construction, soils, title, survey, fire/life safety, insurance, hazardous materials, or other matters. These areas require special education and, generally, special licenses not possessed by Colliers Tingey. Lessee is responsible to consult with its experts regarding these matters. Further, any opinions or other comments which may be provided by Colliers Tingey regarding the Property shall not be relied on by Lessee. Lessee is responsible for gathering and evaluating the information regarding the Property and making an appropriate investment decision. Lessee understands that there is risk associated with any investment decision. ACKNOWLEDGED AND AGREED TO: Lessee:_____________________________________ Date:________________ DocuSign Envelope ID: BCAF4F2E-B4C8-415B-A593-A29924765EB0 12/2/2020 December 3, 2020 City of Fresno Office of the Mayor and City Manager 2600 Fresno Street Fresno, CA 93721 Attention: Office of Cannabis Oversight Responsible and Compliant Retail Blackstone LLC (dba “Embarc Fresno”) 4592 N Blackstone Ave, #103 Fresno, CA 93726 Re: Statement of Financial Health for Embarc Fresno To Whom It May Concern: — Application for a Commercial Cannabis Business (CCB) for Storefront Retail Responsible and Compliant Retail Blackstone LLC dba Embarc Fresno 1 Dear Selection Committee Members, Thank you for the opportunity to submit this proposal to operate a retail and delivery Commercial Cannabis Business in the City of Fresno. As a resident of this community for over three decades, I appreciate the City’s thoughtfulness as we contemplate commercial cannabis activities – and particularly cannabis retail – in our community. As a businessman, I have spent decades building community partnerships and working with our City to prioritize neighborhood-centric development. As a community leader, father and grandfather, I have advocated for and taught the importance of, sports education and youth engagement to keep kids on the right track. As a man of faith, I have served my Church for over twenty years. Given these various roles and responsibilities, partnering with an operator to ensure our community creates a safe, responsible and equitable cannabis industry was certainly not something I envisioned undertaking in my lifetime. While I have never consumed cannabis, I am all too familiar with the negative impacts these types of substances have wreaked on entire communities, particularly low-income communities and communities of color. But with the City of Fresno opting to legalize and regulate local cannabis activity – and having spent significant time getting to know the Embarc team – I see this as an opportunity to get legal, compliant cannabis “right” for our City, with a focus on safety, equity and community-orientation. I welcome this responsibility to set an example for how cannabis can and should operate in our City. I appreciate the sensitivities associated with dispensaries and the need for operators who understand the unique needs and dynamics of our City and who will meaningfully invest in, and integrate into, our community. Balanced against that preference for community mindedness is the need to select operators that have a track record of successful and respectful execution. Now more than ever, we need a team that is operational, not aspirational, to ensure the business is able to open and generate tax revenues and community funding. As an active and engaged community member and resident, I know our team can do just that because Embarc has already demonstrated its ability to operate responsibly elsewhere in California. Although cannabis has existed in communities for decades, regulated cannabis is still an emerging market. Communities are grappling with how to best integrate commercial cannabis activities into existing neighborhoods – balancing the economic opportunity this new industry represents with a desire to protect public health, safety and neighborhood integrity, and to provide meaningful inclusivity to all segments of our community. Embarc understands the transformative impact of diverse, inclusive operations and acts with the belief that operating such a business is a privilege and not a right. Embarc’s successful business model is predicated on the ability to consistently engage the community to ensure communication, transparency, integrity, and collaboration. By putting the community first, we will ensure a positive relationship with the City, community leaders, and the neighborhood, ultimately giving back in meaningful ways. We are committed to supporting Fresno’s social equity program by serving as an incubator and through our approach to supporting incubators across Fresno. Embarc is enthused at the prospect of playing a role in what could be the most impactful social equity program in California – and to amplifying the City’s success here in other jurisdictions throughout California. As a father and now as a grandfather, I have spent countless hours reading stories to my sons and grandson. Goldilocks comes to mind as a fitting analogy as to why Embarc is the right fit for Fresno. Unlike others who simply view Fresno as an opportunity to cash in on the green rush, or who are pursuing licenses across the state or nation to be “the biggest” and “the best,” the team I have partnered with brings a proven track record as experienced leaders with the right motives in this emerging industry. With four licenses to date, Embarc is neither “too big” nor “too small.” Rather, this team can be trusted to operate in Fresno because we bring the experience of existing operations focused on community trust – which most large operators lack. Fresno will not be just another dot on an expansion map because I have spent more than three decades serving, investing and believing in our community. For me, this is home. Thank you again for this opportunity. Sincerely, Steve Hosey – Local Partner; Chair, Embarc Fresno Community Advisory Board and Head of Community Engagement Copyright © 2020 by Responsible and Compliant Retail Blackstone LLC 2 The Community Agrees: Embarc is the Right Choice for Fresno I am excited to participate in Embarc’s Community Advisory Board, providing the opportunity to play a role in shaping the company’s workforce development, expungement, training and education efforts for their 100% local workforce. Elizabeth Jonasson Rosas, Fresno Economic Opportunities Commission I am hopeful Embarc will be selected to operate in our community, providing significant, ongoing finan- cial and volunteer support for vital local organizations. I am pleased to have a seat on their Community Advisory Board, which will provide a voice for local stakeholders in the company’s operations. This commitment to community is exactly what I’d like to see from a local cannabis operator. Scott Miller, CEO of Gazebo Gardens It is vital that, as the City thoughtfully considers local cannabis businesses, it recognizes those that are locally integrated and will put our community above all else. After getting to know the Embarc team, I am confident they will do just that. As a long-term resident and community advocate, I am honored to serve on Embarc’s Community Advisory Board and to play a role in shaping their operations and community benefits. David Bouttavong, Equality California As a Fresno resident for more than a decade, I was thrilled to learn that Embarc has partnered with Steve Hosey to deliver a cannabis dispensary that will serve as a model to other operators throughout our community. Embarc has set the bar for legal cannabis in their existing operations and I am confident they will play a critical role in ensuring Fresno’s cannabis industry is local, equitable and welcoming to all. Zack Kaufman, Local Resident Members of the Embarc team have spent more than two years working collaboratively with our City to develop what will be one of the state’s largest cultivation sites. Throughout this process, they have demonstrated unyielding professionalism and integrity. But more importantly, they have also demon- strated passion and their hearts, supporting local non-profit organizations and committing to 100% local hiring. I am proud of the partnership they have created with the City of Mendota and am excited to hear that, if successful in Fresno, they will create an entire ecosystem that will ensure cannabis grown in Fresno County stays in Fresno County. I urge you to support their applications in your City – they have been an ideal partner in mine. Rolando Castro, Mayor of the City of Mendota 3 Section 1: Business Plan Executive Summary Thank you for the opportunity to submit this proposal. We are enthused at the prospect of both creating a corporate headquarters in Fresno as well as bringing our proven track record of operating community-oriented cannabis businesses to the Fresno community. As a partnership between Steve Hosey, a three-decade resident and committed community leader in Fresno, and seasoned cannabis operators with a proven track record of compliant, transparent, and profitable operations, our team brings together diverse backgrounds and professional expertise to this endeavor. Despite our varied backgrounds, we share a common vision for cannabis businesses that successfully integrate into and contribute to the communities in which they are located, and from that shared vision, Embarc Fresno was born. Over the past decade, Embarc’s leadership team has been a driving force in the development and implemen- tation of responsible cannabis legalization policies, both in California and internationally. Through its local partnership model, Embarc has four dispensaries in Northern California and is on track to operationalize approximately ten additional licenses over the next eighteen months. But what differentiates Embarc from other operators is more than regulatory expertise; we have a proven track record of providing meaningful civic engagement, patient and customer education, and ongoing community support across all operations. Embarc is not simply writing a check or undertaking a few hours of volunteerism; we have integrated community-orientation into our operations by putting local residents and community stake- holders at the helm of our decision making via a Community Advisory Board. Our track record is evidenced in our existing operations and will be scaled across the company as Embarc continues to grow. Ultimately, we are more than just proven, responsible cannabis operators; we are trusted local partners in the communities where we live and work. We are not just saying that about ourselves. Embarc has been endorsed by some of the leading non-profit organizations and elected leaders across the state—an honor we do not take lightly. It is our continuing role within the communities we serve, and the trust placed in us by these myriad community leaders throughout California, that informs how Embarc distinguishes our operations and philoso- phy from other cannabis retailers. Embarc is committed to philanthropy and in the short time they have been open, have already donated thousands of dollars to local non-profits. I feel strongly that businesses permitted to retail cannabis must conform to the highest standards of ethics and business practices, and be willing to work with and support local nonprofits and youth organizations. In Embarc you will find a business that exemplifies those standards, and provides meaningful support and engagement with the local community. Jude Wood, Executive Director, Boys and Girls Club of South Lake Tahoe 4 We deserve cannabis operators with a track record of community engagement, meaningful local support, and unparalleled cannabis business and compliance expertise that will ensure smooth operations...the Embarc team are that partner. Senator Bill Dodd (SD 3) Embarc’s business model is predicated on being a committed community partner that serves as a model business that the community can stand behind. Embarc prioritizes transparency, accountability and integrity in all that they do. This is vital for us in providing banking services in such a nascent industry, and it is vital for the communities, landlords and non-profit organizations that they partner with to execute their vision. Robert Starkey, Salal Credit Union (Bank) As Californians voted to legalize marijuana, and new businesses in this expanding industry make their way into our communities, it is imperative that they enlist the input of local residents. I commend Embarc for creating a Community Advisory Board to address local concerns, support the best utiliza- tion of community benefit dollars, and advocate to ensure our youth are protected. Congressman Jerry McNerney (CA-9) I fully support Embarc in their endeavor to expand and wish to express that they are the operator you want in your community. Based on their track record in mine, I will tell you they embody all of the qualifications you are seeking, and they stand for community above all else. Jason Collin, Mayor, City of South Lake Tahoe Embarc will bring to Fresno the same commitment to compliance, customers, patients, and the community that are hallmarks of our business model and evident in our existing operations. For these reasons, and as detailed throughout our proposal, we believe we are the right partners for the City of Fresno’s Commercial Cannabis Business program: • Embarc is a partnership between a decades-long local resident and an operational team with over 350 years of combined business experience. This team brings an unparalleled operational track record of executive-level leadership in cannabis, retail, supply chain and other highly regulated industries. • Embarc is well capitalized and prepared to deploy in funding to ensure our community-driven plan comes to fruition with a commitment to establish a corporate office in Fresno that, when combined with our three applications and incubator partnership, will bring over 100 jobs to the City. • Embarc operates with sound financial principles and a realistic, scalable and achievable growth plan. Our success to date is the result of significant innovative, responsive, competent and practical business acumen, as demonstrated by our current operations and strong economic position as we scale and grow. • Embarc is committed to bringing best-in-class practices to the City of Fresno’s cannabis industry as well as the experience of a team that has operated successful, legal cannabis dispensaries in California for a decade. Our management team has a proven track record of delivering on our promises to resi- dents, local officials, community leaders, neighbors, patients, and customers. We are a model retailer in the industry and demonstrate how cannabis can work in true partnership with the City to define a new cannabis experience for the modern patient and consumer. • Embarc has significant expertise navigating the complex legal and regulatory framework for cannabis. Embarc team members effectively wrote and implemented Proposition 64—from Chief Compliance Officer Dustin Moore serving as the day-to-day campaign manager and Senior Vice President of Regulatory Affairs Kevin Schmidt serving as Senior Policy Advisor to then Lt. Governor Gavin Newsom. 5 • With a commitment to responsible and community minded regulations, Embarc has shaped—and continues to refine—the regulatory landscape for cannabis in California. • Embarc has a track record of successful cannabis operations, both as Embarc and as strategic advisors and consultants for the leading cannabis retailers and brands across the country in a variety of regulated cannabis markets. We combine this experience with unique expertise in the policy arena that informs our desire for transparency and partnership with local government. • Embarc has a proven commitment to its employees, with a demonstrated track record of industry-lead- ing wages, benefits, educational and training opportunities and upward mobility creation. • Embarc’s commitment to community integration is about more than just writing a check. We have developed meaningful, ongoing partnerships with the communities we serve and have integrated community engagement and support into our business model in significant ways, including through the development of a local Community Advisory Board to guide our operations and community contributions. • Embarc has robust community safety and security plans developed by leading subject matter experts that have been tested through existing operations to ensure best practices, compliance and robust public health and safety measures are at the forefront of daily operations. • Embarc will bring a philanthropic ethos and commitment to support the City of Fresno’s economic growth and prosperity resulting in tangible economic benefits and opportunities for the City, its residents, and local nonprofit partners, with a significant focus on youth education and drug prevention programs. • Embarc is committed to social equity, not just through our internal hiring and support of the City’s programs but also through a commitment to social equity incubation. Embarc has committed to the creation of a social equity apprenticeship program in its Fresno retail location(s) as well as to supporting another applicant’s social equity incubation venture with volunteerism, financial and human resources, shelf space and a jobs pipeline to ensure Fresno’s social equity cultivators, manufacturers, brands and distributors are able to effectively capture market share. Embarc’s model is how cannabis retail can and should operate in Fresno. Creating a Local Ecosystem As a demonstration of our commitment to the City of Fresno and the retail applications we have put forth, the Embarc team will ensure we have the infrastructure necessary to deliver on our promises. We will be estab- lishing a corporate headquarters in Fresno to support our retail operations, our incubator partnership, and our cultivation site that is the backbone of our supply chain. Embarc principals are in the process of operationalizing a 24-acre cultivation site in the City of Mendota that will act as the backbone of our supply chain, providing sufficient supply for both our entire proposed retail footprint as well as the needs of our local incubation partner. This ecosystem will generate over 100 local jobs and will deploy tens of millions of dollars each year into the local economy. Members of the Embarc team have spent more than two years working collaboratively with our City to develop what will be one of the state’s largest cultivation sites. Throughout this process, they have demonstrated unyielding professionalism and integrity. But more importantly, they have also demon- strated passion and their hearts, supporting local non-profit organizations and committing to 100% local hiring. I am proud of the partnership they have created with the City of Mendota and am excited to hear that, if successful in Fresno, they will create an entire ecosystem that will ensure cannabis grown in Fresno County stays in Fresno County. I urge you to support their applications in your City—they have been an ideal partner in mine.” Rolando Castro, Mayor, City of Mendota 6 Deep Local Roots As detailed above, Embarc Fresno (“Embarc”) is comprised of local community members and business leaders with unparalleled experience operating compliant retail dispensaries and similar businesses. Embarc brings over 350 years of combined experience to our proposed cannabis dispensary, representing the vision and operational track record of executive-level leadership in cannabis, retail, supply chain, and other highly regu- lated industries. Our team also includes seasoned former law enforcement and public health and safety officers committed to the creation of a business that enhances the surrounding neighborhood and has a positive impact on the Fresno community. We believe an applicant must have a track record of local engagement to understand the unique needs, values and expectations of the community served and to create an operation that reflects these qualities. Embarc is focused on creating and maintaining a local operation that ensures the business is the right fit for Fresno and that its operations are community oriented—hiring 100% locally and empowering local community leaders to guide and inform mindful operations through our Community Advisory Board. Embarc’s team is led by local partner and Head of Community Affairs, Steve Hosey. Steve brings a unique perspective and deep appreciation for Fresno to this endeavor. Steve was raised in a single parent household in Oakland, California, and earned a baseball scholarship to Fresno State University. He excelled as a power hitter on a championship team and was drafted by Major League Baseball to play for the San Francisco Giants. He played for the Giants and Angels, and also played internationally before coaching in the Oakland A’s and Kansas City Royals organizations. In these capacities, Steve gained an understanding of communities large and small as he coached in cities across the United States, Mexico, and Canada. Since leaving athletics, Steve has become integral to the fabric of the local community in many ways. Upon retiring from professional baseball, Steve returned to Fresno to raise his family and began a successful career in real estate. Steve is recognized for developing high quality grocery shopping centers and rehabilitating resi- dential properties in underserved communities, as well as for his participation in Neighborhood Stabilization Programs (NSP) 1 and 3 in partnership with the City of Fresno to develop affordable housing in priority areas of the City to empower neighborhood residents to be owners within their own neighborhoods. In addition to his real estate pursuits, Steve has dedicated much of his life to youth, families and faith. Steve is a Director of Family-School Partnerships for Family Leadership, Inc., where he is known for his engaging train- ing style and long-term partnerships with school districts. In 2014, he moved into a national leadership position with Family Leadership to incorporate his experience as a parent and community leader. In these capacities, Steve is focused on arming parents with the tools they need to more effectively parent and keeping youth on the right path through strong familial relationships and support. His passion to give back to the community and his commitment to developing healthy families throughout Fresno and the Central San Joaquin Valley is reflected in the work he does through Family Leadership. Steve utilizes known methods and innovative strategies to ensure student success and help improve student test scores, all while increasing and sustaining parent engagement. Steve and his wife hold bachelor’s degrees in Ministry and Leadership and have served in their local church for more than 20 years. In this capacity, Steve satisfies a primary motivator and purpose in his life—growing in his faith. Steve is an active member of the Fresno community within his passions of faith, family, sports and real estate. He sits on the Advisory Committee for the Fresno Grizzlies, is active in sports non-profits focused on engaging youth in physical activity, is an event speaker for the Fellowship of Christian Athletes, and is a member of 7 Christian Businessmen Connection, among other activities. This significant experience that informs his desire to ensure cannabis is integrated thoughtfully and responsibly in his community. Getting Cannabis ‘Right’ for Our Community Given Steve’s legacy of community leadership, he was initially hesitant upon hearing cannabis was coming to Fresno. But after learning more about the emerging industry, including the robust regulations in place, he realized that since cannabis was coming, it needed to be implemented by someone who cares about this community and has substantial business management experience, ensuring operations are appropriately and mindfully integrated into Fresno. Steve knew he had the skills necessary to build and manage a team that could execute a successful cannabis business in Fresno, so he did just that by partnering with the Embarc leadership team who bring unparalleled experience and a track record of execution in compliant cannabis activities. Steve is proud to have partnered with a team that includes Fortune 500 executives, proven cannabis operators, and business owners that have experience in retail, hospitality, supply chain and other highly regulated busi- nesses, and leading experts in cannabis compliance who are actively engaged at both the state and local level to ensure regulations are developed and implemented that provide for the highest level of public health and safety. This team will create more than just a cannabis dispensary—Embarc is committed to the creation of a unique experience that honors local values and provides meaningful benefits for Fresno, its residents, and Embarc’s non-profit and community-based partners. Embarc’s community engagement is led by Steve, whose professional, civic and volunteer engagement in the region spans decades. Steve will also oversee Embarc’s social equity incubation and apprenticeship efforts, both internally in all local locations where Embarc may be selected to operate as well as through a significant, ongoing commitment of financial and human resources to F.E.E.D. (Fresno Equity & Enterprise Development), a local cannabis campus being proposed as an incubation program by Steve’s childhood best friend. Steve and his friend grew up together in Oakland, playing baseball and dreaming of a future where they could “go pro.” Steve was fortunate enough to be selected to play baseball at Fresno State, where his friend followed after being recruited to play one year later. Their friendship has been an integral part of both of their lives ever since—in baseball, real estate, and in their successful efforts to teach thousands of Fresno kids how to play baseball, and, by extension, how to navigate life. Their commitment to community and to their friendship is a driving force in each of their desires to play a role in shaping Fresno’s nascent cannabis industry, where Steve now proposes to leverage the variety of skills, resources and experience of the Embarc team to partner with F.E.E.D., the incubation campus, as an incubation partner. Embarc is committed to serving as an engaged cannabis business incubator in a variety of ways: • Volunteerism: Our Executive Leadership Team will help to develop F.E.E.D.’s incubation curriculum and teach many of its courses as part of our executive volunteerism, committing hundreds of hours each year from C-Suite Executives. • Business Training: Embarc will provide mentorship across all components of cannabis business opera- tions, from real estate and permitting to marketing and compliance. • Apprenticeship: Embarc will leverage its retail assets to provide apprenticeship opportunities for social equity qualifying applicants, with priority placement given to those who are in or have graduated from F.E.E.D. • Economic Benefit: Our principals will provide cultivation output from their Mendota site to licensed social equity incubatees at cost, eliminating the approximately 50% markup typically included in the sale of cannabis. 8 • Expungement: Embarc will fund expungements for all F.E.E.D. participants. • Priority Shelf Space: Embarc will commit to no less than 20% of its shelf space allocated for social equity brands, with a plan to increase this number to 50% once local brands are operational. “Keeping it in the family” transcends this decades-long friendship and brotherhood. Through this partnership with Embarc, Steve now works with husband and wife team Dustin and Lauren, who have played pivotal roles in shaping California’s legal and compliant cannabis industry, particularly through Dustin’s role as the cam- paign manager for Proposition 64, which legalized adult use, and Lauren’s efforts in the regulatory, community and operational spaces for cannabis retailers throughout California. It is these familial relationships and strong partnerships that drive our desire to create a local business that instills a sense community by colleagues becoming friends and community members feeling as though they are members of the Embarc family. As detailed below, the overall depth and breadth of the Embarc team’s knowledge and experience as community leaders and business owners means we are truly committed to this community. Unlike outside entities and multi-state operators with no vested interest in the City of Fresno, Embarc Fresno will operate a compliant business ecosystem with strict adherence to regulations, industry standards and best practices, because for Steve, this community is not just another location in an expansion plan, it is home. SECTION 1.1 Owner qualifications. Resumes are not to exceed two (2) pages per owner. Below is a high-level overview of Embarc’s team, including its ownership and senior leadership members. Community Advisory Board Chief Executive Officer Chief Operations Officer VP, Operations SVP, Regulatory Affairs Head of Engagement Head of Government Affairs Director, Compliance VP, Public Affairs Head of Security HR Chief Compliance Officer Chief Brand Officer Manager, Marketing and Partnerships Chief Financial Officer VP, Finance & Corporate Development Senior Accountant AP Chief Legal Officer Misc. Counsel Chair, Community Advisory Board Strategic Advisors 9 Ownership Steve Hosey, Chair, Community Advisory Board and Head of Community Engagement Lauren Carpenter, Chief Executive Officer Leadership Terri Gilles, Chief Operations Officer Terry Muller, Vice President of Retail Operations Devon Wardlow, Vice President of Public Affairs Matt Carroll, Head of Security Dustin Moore, Chief Compliance Officer Kevin Schmidt, Senior Vice President of Regulatory Affairs Christy Wilson, Head of Engagement George Miller, Head of Government Affairs Lauren Silberman, Director of Compliance and Licensing Courtney Zalewski, Chief Brand Officer Nic Magbanua, Marketing and Partnerships Manager Dan Staszak, Chief Financial Officer Leonard Schlemm, Vice President of Finance and Corporate Development Amy Welker, Senior Accountant Phyllis Newton, Chief Legal Officer Strategic Advisors Reginald Zellous, Fire and Life Safety Advisor Scott Miller, Community Relations Advisor Mike Beaudry, Supply Chain Advisor John Yost, Brand and Marketing Advisor Lex Gemas, Retail and Operations Advisor Kristin Nevedal, Cannabis Education and Sustainability Advisor Luanne Moore, Seniors Outreach and Educational Advisor Lauren Schmidt, Wellness Education Advisor STEVE HOSEY Owner, Head of Community Engagement, Chair of the Community Advisory Board — Steve Hosey is a small business owner and former Major League Baseball player. Steve has a deep commitment to the Fresno community because of the profound impact it had on him when he was a young student athlete at Fresno State. Fresno has been his home for 30 years. Steve and his wife raised their family and built their business in Fresno. Throughout his professional baseball career, playing and coaching for the San Francisco Giants and the Oakland Athletics, Fresno remained his family’s home. Steve is a successful businessman, real estate broker, and community leader. Steve has been a mentor to young people and families for over a decade as a leader in his church and as the Director of Parent Engagement and Training for Family Leadership, Inc. He has been married to his wife Deborah for over 25 years and they have two sons, Deven and Dathan. 10 Date Role 2020—Present Local Partner, Embarc Fresno Head of Community Engagement Chair, Community Advisory Board 2014—Present Director of Family-School Partnerships, Family Leadership, Inc. 2003—Present Owner, H&P Properties, Inc. 1995—Present Real Estate Broker LAUREN CARPENTER Owner & Chief Executive Officer — Lauren has a decade of private sector executive leadership experience in cannabis and other highly regulated industries. Lauren is a prolific team builder who has led key strategic efforts for some of the largest and most successful business coalitions in California, including Fortune 50 companies and some of the largest cannabis retailers in the world. She previously served as Chief Strategy Officer for Sweet Flower, one of the largest cannabis retailers in Los Angeles, where she was responsible for creating and executing corporate strategic initiatives across community, regulatory, political and business arenas while driving the company’s dynamic growth strategy. She oversaw operationalization of retail assets in Los Angeles while developing the company’s licensing strategy, commu- nity engagement programs and government affairs platform. She has also served as Director of Government Affairs for Western States for MedMen, one of the world’s largest vertically integrated cannabis operators. She was responsible for the company’s political, government, public and community affairs strategies at the state and local levels across the Western United States, including in states that have legalized adult use cannabis and in states with pending adult use legislation and initiatives. She has worked with governments throughout California and across the country to implement responsible cannabis regulations and uses this expertise to inform the execution of Embarc’s business model. Date Role 2020—Present CEO, Embarc Fresno 2019 – 2020 Chief Strategy Officer, Sweet Flower 2018—2019 Director of Government Affairs for Western States, MedMen California Political Director, MedMen 2012—2018 Sr. Account Executive, Wilson Public Affairs Account Executive, Wilson Public Affairs 2 010—2012 Misc. Political Campaigns TERRI GILLES Chief Operations Officer — Terri brings nearly two decades of operational expertise to Embarc, having led operations for top leaders in the technology, sports and cannabis industries. Terri oversaw Google’s western regional real estate portfolio and daily operations. She was then tapped to establish Snap Inc.’s Facilities and Operations team. In these capaci- ties, Terri was responsible for managing teams of over 300 employees, and the development of over two million square feet of construction. Terri is a LEED accredited professional. 11 After nearly 10 years in technology, Terri transitioned into the cannabis industry. She was the first hire at Sweet Flower, where she served as Chief Operating Officer. Terri was responsible for positioning the new company as Southern California’s premier cannabis retailer and for building out four high-end retail stores, developing the brand, and creating a best-in-class retail team. Terri brings this unique combination of experience to Embarc, where she oversees all of the company’s development, expansion and operations. Date Role 2020—Present Chief Operations Officer, Embarc Jan 2019—Jan 2020 Chief Operating Officer, Sweet Flower 2016—2018 Global Head of Workplace Services, Snap Inc. 2010—2016 Southwest Regional Facilities Manager, Google 2004—2006 Operations Manager, Alan Friedman Designs 1994—2004 Elementary School Teacher, Brentwood School TERRY MULLER Vice President of Retail Operations — Terry brings more than 15 years of professional experience to Embarc, the majority of which has been in the establishment and operation of licensed, compliant commercial cannabis businesses. His wide range of experi- ence includes establishing a premier medical marijuana caregiver collective in the Midwest, serving as a chief consultant to premier medical cannabis businesses throughout California, developing equity-centered commu- nity outreach programs for cannabis businesses, facilitating cannabis brand development and marketing strategy, supervising cultivation facilities, and providing management services to established cannabis dispensaries. In 2009, Terry co-founded a cannabis caregiver collective in the Midwest that was one of the first businesses to receive a state license and was used as a model statewide. Terry then went on to establish a consulting business in which he supported medical cannabis dispensaries in developing their community outreach programs, wellness services, standard operating procedures, vendor management, and employment systems. In this capacity, Terry was instrumental in the development, launch and ongoing operations of prominent dispensaries throughout California. After serving in an advisory role for Barbary Coast, one of San Francisco’s preeminent dispensaries and consumption lounges, for a number of years, Terry formally joined its operation in 2016 and was responsible for neighborhood integration and communication, employee management, and overarching strategic operational management, including front-of-house and back-of-house operations, inventory, purchasing and more. As part of his business development and neighborhood integration efforts in opening and operating two Barbary Coast dispensaries, Terry facilitated more than a dozen community workshops, providing educational sessions and building partnerships with neighborhood associations. Through this process, Terry gained extensive experience navigating local and state regulations. Date Role 2020—Present Vice President of Retail Operations, Embarc 2017—2020 Director, National Bridges Consulting (San Francisco) 2016—2020 General Manager, Barbary Coast Collective (San Francisco) Dispensary Director in the Midwest 2006—2010 Audio Technician, PG&E Training Facility (San Ramon) 2000—Present Audio Technician, Local 16 I.A.T.S.E. (San Francisco) 12 DEVON WARDLOW Vice President of Public Affairs — Devon brings over a decade of public affairs experience working at the intersection of innovation and policy at the federal and local levels to her role at Embarc. From serving in the Obama Administration’s White House Business Council to advancing technology policy with Facebook and then Lyft, Devon has built a career in navigating the complex regulatory, policy and community impacts and opportunities related to emerging industries. After leaving Washington D.C. to return home to Santa Barbara, Devon quickly channeled her expertise in regulatory and public affairs to help shape the region’s nascent cannabis industry. Serving as cannabis retailer Coastal Dispensary’s Director of Public Affairs, Devon led the company’s political and expansion strategies throughout California. She is a trusted partner to communities and public officials alike working to ensure a smooth transition to legal cannabis for regulators, operators and the community in which they seek to serve. During her tenure in DC, Devon spearheaded the programming development of the White House Business Council’s national private sector engagement efforts as Director of National Programming at Business Forward. She was then appointed as Secretary Tom Perez’s Private Sector Engagement Advisor at the U.S. Department of Labor, working to advance higher wages and greater benefits while fostering paths for innovative business models. Transitioning to the private sector, Devon joined Facebook’s public policy team, spearheading their national small business programming with Congress before joining Lyft to establish their DC office and manage legislative priorities with Congress and the White House. Date Role 2020—Present Vice President of Public Affairs, Embarc 2018—2020 Director of Public Affairs, Coastal Dispensary 2016—2018 Federal Affairs Manager, Lyft 2015—2016 Small Business Policy Manager, Facebook 2014—2015 Private Sector Advisor, US Dept of Labor 2012—2014 Director of National Programming, Business Forward MATT CARROLL Head of Security — Matt is one of the most qualified cannabis security experts in California, having helped create and implement the rules and regulations governing commercial cannabis businesses in the State. After years of service as a police officer and advising the Coast Guard on port security in the wake of 9/11, Matt founded Paladin Private Security, a company widely recognized as Northern California’s leader in private patrol and response services. Matt designs and maintains security programs for over 450 clients, including Sacramento Regional Transit, the City of Sacramento, public school districts, recreation and park districts, property owners, and business improvement districts. As the City of Sacramento’s cannabis industry took shape, Matt worked closely with the Sacramento Police Department to develop ordinances, standards and best practices. To date, Matt has authored and executed over 85% of the security plans required of Sacramento cannabis licensees. In late 2017, Matt began providing cannabis security consulting services for other municipalities. Matt is currently under contract with the cities of Dixon and Benicia Police Departments, training city staff, police and code enforcement personnel on cannabis 13 regulations, crime prevention strategies, crime prevention through environmental design, and assisting with facility design review, security plan review, and both site and compliance inspections. He brings this wealth of knowledge and practical experience to Embarc, designing and implementing security protocols, strategies, trainings and execution. Date Role 2018—Present Head of Security, Embarc 2015—Present Founder, Sacramento Security Training Center 2003—Present Founder, Paladin Private Security Company 2001—2003 Port of West Sacramento Police Department 1998—2001 Sacramento County Sheriff’s Department DUSTIN MOORE Chief Compliance Officer — Dustin Moore has been a driving force behind California’s efforts to legalize and regulate commercial cannabis for nearly a decade. In 2011, while working for the Speaker of the California Assembly, Dustin developed legislation for medical cannabis regulations that served as the foundation for the regulatory framework in place today. In 2014, he began working to develop, and ultimately served as Deputy Campaign Manager for Proposition 64, the successful ballot measure that legalized adult-use cannabis in California. No one is more familiar with Proposition 64’s language and intended implementation than Dustin. After Proposition 64 passed overwhelmingly in 2016 and having developed unrivaled expertise about how to effectively regulate the cannabis industry, Dustin began working with local, state, national and international jurisdictions to assist in developing and implementing their regulatory and licensing programs, including in Canada, Mexico and municipalities throughout California. Dustin is regarded as a premier subject matter expert whose advice and experience is sought by both the private and public sectors nationally and internationally. In 2018, he worked with Canada on their testing regulations and he is currently serving as an advisor to the Mexican Senate in the development of Mexico’s adult-use legalization legislation. He has served as Executive Director and is currently a board member of the International Cannabis Farmers Association and is a member of the State of California’s Track and Trace Advisory Committee. True to the intent of Proposition 64, Dustin specializes in policy development that prioritizes public health and safety. After nearly five years of California cannabis policy development, Dustin Moore became a founding partner at Axiom Advisors, the state’s leading strategic consulting firm providing business and compliance services to professional cannabis associations, cannabis manufacturers, distributors, testing labs and retailers. In this role, he and others at the firm are responsible for managing the compliance for more than 200 com- mercial cannabis license holders in California, including over three million square feet of licensed cultivation. Dustin is a highly regarded subject matter expert and sought after speaker at countless cannabis events, panels, discussions and conferences across the country. Date Role 2020—Present Chief Compliance Officer, Embarc 2019–Present Partner, Axiom Advisors Board Member, International Cannabis Farmers Association 14 Date Role 2017–2019 Principal, Main Street Strategies Executive Director, International Cannabis Farmers Association 2015–2016 Deputy Campaign Manager, Yes on Proposition 64 2014–2015 Consultant, Kaufman Campaign Consultants 2012–2014 Senior Consultant, California State Assembly KEVIN SCHMIDT Senior Vice President of Regulatory Affairs — Kevin Schmidt is a fourth-generation California public servant with the institutional knowledge necessary to navigate California’s complex political and regulatory landscape. Beginning his public service career with the California Senate Majority Leader, Kevin worked on a broad array of topics including agriculture, water, and energy. Kevin then served for five years as Policy Director for then-Lieutenant Governor Gavin Newsom, focusing on energy, natural resources, economic development, higher education, and other policy issues. Kevin represented Lt. Governor Newsom on the California Coastal Commission, the California State Lands Commission, and the Ocean Protection Council, and in those positions was responsible for making decisions on important statewide policies and multibillion-dollar State budgets. During his time with the Lt. Governor, Kevin spearheaded the Blue-Ribbon Commission on Cannabis and served as a senior advisor to the Proposition 64 campaign. Since then, he has been instrumental in shaping California’s legal commercial cannabis industry, working to help draft the laws, regulations and statute in place today. Kevin has since become a founding partner of Axiom Advisors, the leading cannabis compliance, regulatory and political consulting firm in California. In this capacity, Kevin has developed extensive relationships in the cannabis industry and with the California Governor’s Office, legislators and regulators that are critical to his role as Senior Vice President of Regulatory Affairs for Embarc. Date Role 2020—Present Senior Vice President of Regulatory Affairs, Embarc Jan 2019—Present Partner, Axiom Advisors Jan 2016—Dec 2018 Partner, California Strategies Feb 2011—Jan 2016 Policy Director, Lt. Governor Gavin Newsom Jan 2009—Feb 2011 Policy Analyst, California State Senate CHRISTY WILSON Head of Engagement — Christy Wilson has a multi-dimensional background in developing and executing outreach campaigns and meaningful partnerships in the cannabis industry and traditional businesses. As a small business owner of a prominent Sacramento public affairs firm, Christy brings nearly twenty years of experience in community and stakeholder engagement across a variety of complex and highly regulated issue areas including insurance reform, mortgage and financial bailouts, energy, gaming, campaign finance, taxation and education. She is also the local owner for Embarc Tahoe, which has developed a robust coalition 15 of community support ranging from the Boys and Girls Club to the Drug Free Coalition. She brings a wealth of experience in partnership best practices. Date Role 2019—Present Owner, Embarc Tahoe 2013—Present President, Wilson Public Affairs 1998—2013 Partner, Goddard Claussen Public Affairs GEORGE MILLER Head of Government Affairs — George Miller IV has dedicated his career to parallel goals—public service and navigation of California’s complex regulatory environment. George has served as a California Coastal Commissioner, working to protect and enhance California’s coast and ocean for present and future generations. In this capacity, George served as a regulator for the State, ensuring he understands the importance of working within a highly regulated environ- ment such as the cannabis industry. George is a partner at a prominent Sacramento political consulting firm responsible for helping leading cannabis companies, Fortune 500 companies, trade associations and others navigate regulatory and political compliance in California, demonstrating Embarc’s ability to operate businesses across industries in accordance with robust regulations. Date Role Jan 2020—Present Owner, Embarc Martinez and Embarc Contra Costa Jan 2020—Present Managing General Partner, Miller, Cespedes & Associates April 1998—Jan 2020 Partner, Lang, Hansen, O’Malley & Miller LAUREN SILBERMAN Director of Compliance and Licensing — Lauren brings nearly a decade of versatile cannabis industry experience to Embarc, having served as an advi- sor, consultant and in-house team member for efforts across cultivation, extraction, manufacturing, distribution, retail and research. Lauren is a specialist in cannabis licensing and compliance as well as market research and immersion, business and new market development, and educational services. She has a deep understanding of the global cannabis landscape and has served as a strategic advisor for cannabis companies around the world. Lauren is a California native, but her cannabis industry story started in Southern Oregon, where she began working with medical cannabis companies in 2011. A talented technical writer, Lauren transitioned from grant writing for nonprofits to application writing for commercial cannabis licenses in 2014. She has since helped a range of clients navigate the complex licensing and operationalization processes for over 25 licensees in jurisdictions across the United States. Before entering the cannabis industry, Lauren gained experience coordinating and publishing academic research, and regularly works with cannabis research organizations in both the US and Israel. Since 2015, she has spent significant time in Israel, the epicenter of medical cannabis research, supporting medical cannabis research and development companies focused on developing and validating cannabis products for medicinal use. 16 Lauren is also a talented public speaker and experienced educator. She regularly gives talks and workshops focused on patient education, cannabis science, and new market development. She served as a Speaker at CannaTech Tel Aviv 2019, where she presented on the product development and medical validation opportuni- ties available in Israel. Date Role Nov 2020—Present Director of Compliance and Licensing, Embarc 2019—Present Founder & Principal Consultant, Tunitas Cannabis Advisory 2018—2019 New Market Development Manager, Acreage Holdings 2017—Present Founder & Coordinator / Board Secretary Coastside Cannabis Coalition / San Mateo County Cannabis Association 2015—2018 Cannabis Licensing & Compliance Consultant Notable clients include: Treadwell Nursery (FL, vertically integrated, sold to MedMen in 2018), Dirty Arm Farm (OR, cultivation and extraction), CWG Botanicals/Cannatique Farms (CA, cultivation, manufacturing, distribution, sold to Acreage Holdings in 2018), Highway 29 Healthcare (CA, distribution, dispensing) 2015—2018 Cannabis Operationalization & Communications Consultant Notable clients include: Kanabo Research (IS, research), Silica Earth (OR, cultivation), Medical Marijuana 411 (WA, education), Medical Cannabis Mentor/Joe Dolce (US, research/education) 2014—2015 Implementation Manager, Green Valley Wellness COURTNEY ZALEWSKI Chief Brand Officer — Courtney is one of the most prolific brand builders in the cannabis industry, bringing more than half a decade of cannabis design and entrepreneurial experience to Embarc. Courtney previously served as the Vice President of Product and Design for Lowell Herb Co., effectively creating and implementing one of California’s most recognized cannabis brands. Courtney knows how to develop a lasting brand with experience spanning brand development, compliance and operations. Courtney is also one of the co-founders of the Original Cannabis Café in West Hollywood, the nation’s first and only legal, licensed cannabis consumption café. This ensures Courtney has her finger on the pulse of consumer behavior in both cannabis retail and social consumption settings and drives her development of Embarc’s brand and marketing strategies. Date Role 2020—Present Chief Brand Officer, Embarc 2017—Present Partner & Co-Founder, Cannabis Cafe 2015-Present Partner & Co-Founder, Studio Good 2015—2019 Co-Creator, Co-Founder, VP Product & Design, Lowell Herb Co. 2016—2017 Partner, Midnight 2015—2016 Director of UX, Pager 2010—2015 Freelance Designer 17 NIC MAGBANUA Marketing and Partnerships Manager — Nic brings years of marketing and partnership experience to Embarc, including marketing and partnership efforts for a prominent California cannabis retailer and manufacturer. This experience includes creating high performing marketing campaigns, brand development, and developing strategic partnerships across the industry and local communities. These partnerships are a foundation of Embarc’s business model. Nic’s lifelong passion for music was manifested in a 13-year career in which he built a successful brand as a music producer and touring artist. He pursued his ambitions after receiving a bachelor’s degree from California State University East Bay with a double major in Marketing and Operations Management. His mission as Embarc’s Marketing and Partnerships Manager is to create positive social change by building strong relation- ships with like-minded organizations, the cannabis community, and our customers. Date Role 2020—Present Marketing & Partnerships Manager, Embarc 2019—2020 Marketing Lead, NUG 2018—2019 Field Marketing Coordinator, NUG 2005—2018 Music Producer/Founder, Panic City DAN STASZAK Chief Financial Officer — Dan brings more than thirty years of experience in fiscal management for diverse companies including those in the health, wellness and cannabis arenas. In 2011, Dan founded Staszak & Company, Inc., a large California CPA firm providing accounting, tax preparation and financial planning services for individuals, businesses, estates and trusts. For more than a decade, Dan served as an Instructor at UC Davis Extension, helping his students distill complex financial and accounting principles into actionable information. Dan brings this wealth of finance and accounting experience to Embarc, where he leads the company’s accounting and finance teams. Dan’s experience as a Chief Financial Officer for healthcare companies provides expertise and insight into the complex legal and financial infrastructure necessary in the cannabis space. Dan is a frequent speaker on tax-related topics. Date Role 2019—Present Chief Financial Officer, Embarc Aug 2011—Present Principal, Staszak & Company Apr 2006—Sept 2017 Instructor, UC Davis Extension Aug 1988—Aug 2011 Partner, Willis & Walsh, CPAs LEONARD SCHLEMM Vice President of Finance and Corporate Development — Leonard is a finance executive specializing in leading high-growth organizations in the cannabis, retail and consumer packaged goods industries. Prior to joining Embarc, Leonard acted as Vice President of Corporate Development & Finance at MWG Holdings Group, Inc., a multi-state cannabis company with a focus on California cannabis operations. Leonard has held various positions in the private equity industry, focusing on acquiring, recapitalizing, and scaling middle-market investments in the retail sector. He has executed over $200 18 million in transactions, while being directly involved in the financial oversight of several portfolio companies. Leonard has experience leading multi-unit retail companies, having been involved in adding over 100 retail locations to several brands. Date Role 2020—Present VP of Finance & Corporate Development, Embarc 2017—2019 VP of Finance & Corporate Development, MWG Holdings Group, Inc. dba Perfect Union 2015—2017 Director of Corporate Development, Amerit Fleet Solutions 2013—2015 Business Development, UFC Gym 2012—2015 Pr ivate Equity Analyst, New Evolution Ventures AMY WELKER Senior Accountant — Amy has spent more than 20 years in a variety of accounting capacities, ranging from accounting manager to controller. She brings this diverse experience in accounting to the cannabis industry, with decades in auditing, SEC reporting and corporate accounting. Amy has worked in various accounting roles across diverse industries including banking, media and energy. Her experience includes work with and for companies including CBS Interactive, Wells Fargo, Pricewaterhouse Coopers, and Del Monte Foods. Most recently, Amy was an Accounting Manager at Gaia, Inc., an online media company that produces content to elevate consciousness. She brings a wealth of knowledge and best practices to her role as Senior Accountant at Embarc, ensuring that all accounting records are well supported and auditable. Date Role Oct 2020—Present Senior Accountant, Embarc 2018—2019 Accounting Manager, Gaia, Inc. 2017 Interim Controller, Altergy 2013—2015 Accounting Manager Sunrun 2010—2012 Accounting Manager, Talenthouse PHYLLIS NEWTON Chief Legal Officer — Phyllis brings over three decades of legal experience to the Embarc team, having served as general counsel to a number of domestic and international organizations. A former litigator, Phyllis brings her experience to drafting and negotiating Embarc’s legal agreements and other business-related documents. Years in the litigation trenches informs her development of Embarc’s risk avoidance strategies and procedures. In conjunction with specialized outside counsel, Phyllis oversees all legal matters and advises Embarc on all aspects of its operations, including transactional requirements, corporate structuring, governance, compliance, intellectual property, insurance, and human resources. She previously served as an Adjunct Professor at McGeorge School of Law. 19 In addition to Embarc’s seasoned leadership team, the company also engages the expertise and experience of an exceptional group of strategic advisors. These advisors provide ongoing guidance, counsel and strategy to the Embarc team and its operations. Date Role 2019—Present Chief Legal Officer, Embarc 1989—Present Law Offices of Phyllis Newton Strategic Advisors REGINALD ZELLOUS Fire and Life Safety Advisor — Fire and Life Safety Advisor Reginald Zellous has more than thirty years of firefighting experience, having served as a firefighter and EMT/Paramedic in Fresno since the 1980s before becoming a City of Fresno Fire Captain in 1996. Prior to his career in firefighting, Reginald served as an Aviation Ordinanceman in the United States Navy and as a Firefighter Specialist in Crash Fire and Rescue for the United States Navy Civil Service out of the Naval Air Station in Lemoore, California. He was awarded a medal of bravery in 2016 for his role in rescuing a CHP officer. Reginald spent his career controlling emergency response planning, including overseeing research for devel- opment of building pre-plans and handling company building fire prevention inspections. He also conducted search and rescue operations, analyzed and responded to medical emergencies, and prepared records of com- pany responses to fires and other emergencies. He brings this wealth of experience and knowledge in the City of Fresno to Embarc, providing review of proposed fire and life safety plans as well as playing a role in their implementation and employee training. SCOTT MILLER Community Relations Advisor — Scott Miller is the CEO of Gazebo Gardens Inc. in Fresno. He started working at the age of 16, maintaining commercial landscaping for a property management company. Nearly three decades later, he is a recognized leader in the horticulture industry, professionally active in the areas of retail nursery, landscape construction, and commercial property maintenance. Scott hosts a popular horticulture-themed radio show that is heard from the Bay Area to the Grapevine. Community service in Fresno is central to Scott’s life; he sits on several community boards and committees and was honored to serve as the 2012 Chairman of the Fresno Chamber of Commerce. In addition to serving with the Fresno Chamber for more than a decade, Scott has also been active in the chamber’s various programs—he was founding director of the Junior Board, a nine-month program which promotes civic activity to high school students, and a founder of the Small Business University program, which offers business and advocacy semi- nars for small businesses. Among his many notable accomplishments in the Fresno community is his role as one of a handful of residents that worked to save Storyland, overseeing everything from fundraising to construction to maintenance. Scott won the 2014 Small Business Advocate of the Year for the California Chamber of Commerce. 20 MIKE BEAUDRY Supply Chain Advisor — Supply Chain Strategy Advisor Mike Beaudry owns and operates HERBL Solutions, the state’s leading can- nabis distribution company and brings this vast network and understanding of cannabis regulatory compliance to Embarc. Mike has extensive distribution experience, having spent the last 20+ years achieving the highest level of understanding in the perishable distribution business, including natural, organic and specialty foods at United Natural Foods Incorporated, America’s leading distributor of natural and organic foods. While President of UNFI, Mike led teams of up to 5,000 members while managing more than $2 billion in annual revenue. Prior to his role as President, Mike led the operations nationally for UNFI’s highly complicated perishable distribution business, with more than three million square feet of warehouses and 1,000 trucks across the United States. JOHN YOST Brand and Marketing Advisor — John has served as Chief Marketing Officer for publicly traded, vertically integrated cannabis companies, providing a wealth of knowledge and experience in how to best position Embarc as a community-oriented business. He served as Chief Marketing Officer at Harborside, an Oakland dispensary that is one of the most renowned cannabis operations in the world. He has also served as Chief Marketing Officer for FLRish, Inc., a publicly traded, vertically integrated cannabis company, and has served in a similar capacity at companies such as Steep Hill, a cannabis testing laboratory; Francis Ford Coppola Presents, where he served as the first Chief Marketing Officer to market the company’s wine and resort businesses; and Sungevity, a residential and commercial solar design and installation company. From 1996 to 2005 he served as Founder & President of Black Rocket, a national advertising agency and marketing partner with clients such as Yahoo!, Morgan Stanley Online and Peugeot North America. John’s breadth of traditional marketing and cannabis brand positioning experience is invaluable as Embarc seeks to break the marketing mold in the burgeoning legal cannabis industry. LEX GEMAS Retail and Operations Advisor — Lex has served as Chief Operating Officer for multi-billion dollar global retail brands, providing Embarc with invaluable insights into supply chain navigation, retail strategy, and operations based on nearly thirty years of relevant experience. Lex is currently Chief Commercial Officer at Herbl, the state’s leading cannabis distribu- tion company. In that capacity, Lex leads the company’s retail integration efforts, ensuring his finger is on the pulse of cannabis retail operations. Lex’s career includes senior management and chief operating officer roles with large, multi-billion dollar global brands including Nordstrom, Gap, Banana Republic, Victoria’s Secret and Macy’s where he was responsible for the end-to-end demand- driven supply chain and was always focused on consumer experience and satisfaction. He applies his operational expertise and commercial acumen with the complicated nature of retail supply chains to his advisory role for Embarc. 21 KRISTIN NEVEDAL Cannabis Education and Sustainability Advisor — Kristin Nevedal has been a driving force in the development of cannabis policies in California. She sits on the Cannabis Advisory Committee, which advises the Bureau of Cannabis Control and the other licensing authori- ties—the California Department of Food and Agriculture and the California Department of Public Health—on the development of regulations that help protect public health and safety and reduce the illegal market for cannabis. In this capacity, she chairs the Cultivation Subcommittee and Testing Subcommittee and serves on the Microbusiness and Annual Report Subcommittees. She is co-founder, executive director and board member of the International Cannabis Farmers Association, serves as a board member for the California Cannabis Industry Association, where she chairs the agricultural committee, and is the chief compliance officer for Humboldt’s Finest. K ristin is co-founder and board secretary for Sun + Earth Certified, where she assisted in the development of standards for beyond organic earth care and cultivation, human empowerment, and community engagement. K ristin is principal at The Nevedal Group, a small consulting firm specializing in compliance support for seasonal cultivators, temporary cannabis events, and the development of sustainable and regenerative educa- tional programs. As chair of the American Herbal Products Association Cannabis Committee’s cultivation working group, Kristin assisted in the development of cultivation model regulations and best practices for agency consideration. Kristin teaches classes on environmental sustainability and best management practices at Oaksterdam University, America’s first cannabis college. K ristin’s broad policy and advocacy experience also includes serving as a board member for the Emerald Growers Association, Coalition for Cannabis Policy Reform, Californians to Regulate Medical Marijuana, 420 Archives, and the Americans for Safe Access’ Patient Focused Certification Peer Review Board. LUANNE MOORE Seniors Outreach and Educational Advisor — Luanne Moore is a lifelong teacher and counselor who dedicated her entire career to youth and community engagement. Luanne began teaching for the Stockton Unified School District in the early 1970s before transi- tioning into counseling services for elementary students in the District in 1985. She completed her secondary teaching credential with the State of California and then moved into a Secondary Counseling position for Stockton Unified School District. She served as Guidance Chair at Cesar Chavez High School in Stockton until her retirement in 2009, approximately 40 years after initiating her career as an educator. Luanne brings four decades of experience in teaching and counseling to her role as Seniors Outreach and Educational Advisor to Embarc, where she focuses on the development and implementation of educational outreach programing for seniors. She also participates in new store opening trainings, where she teaches Guides how to be sensitive to, and mindful of, the unique needs and perspectives of seniors. LAUREN SCHMIDT Wellness Education Advisor — With over a decade of patient care experience as a licensed nurse, Lauren brings a balanced and compassionate perspective as Embarc’s Wellness Education Advisor. For Lauren, healthcare is not just a job, it is a vocation. After a successful career at Google, Lauren began her healthcare journey with a focus on healthcare for women and low-income communities. This afforded her the opportunity to have a meaningful impact on individual patients every day. 22 Most recently, Lauren honed her healthcare experience working in the Neurosciences Unit at Sutter Sacramento. This role allowed her to develop a deep understanding of the brain and body connection, a key to her role at Embarc, where she advises on how to educate Embarc staff, who in turn educate consumers, about cannabis and wellness. Throughout it all, Lauren has carried with her the lessons learned from Northwestern University—strive to have a positive and significant impact on others above oneself. These values and experi- ence continue to drive Embarc as an industry leader. Relevant Qualifications Our team is comprised of some of the leading cannabis experts in the state, with more than a decade of legal, compliant cannabis operational expertise combined with industry-best compliance expertise from the people that helped design California’s legal marketplace. Embarc’s team members have served as strategic advisors, consultants, and/or employees for the following companies: To summarize key points, our team has unparalleled experience operating in a regulated environment, the ability and knowledge to operate a commercial cannabis business, and is qualified due to its significant, relevant depth and breadth of experience. Cannabis Operations • Currently operates an Embarc retail and delivery dispensary in California with three additional stores opening in the next four months • Served as a C-Suite executive for one of Los Angeles’ largest and fastest growing cannabis retailers 23 • Responsible for constructing and operationalizing four cannabis dispensaries in Los Angeles in a year • Co-founder of a cannabis caregiver collective in the Midwest that was one of the first businesses to receive a state license and was used as a model statewide • Chief Executive Officer of the state’s largest cannabis distribution company • Chief Commercial Officer for the state’s largest cannabis distribution company Regulatory and Compliance • Partnered with then-Lieutenant Governor Gavin Newsom to conduct a Blue Ribbon Commission, which led to the creation of Proposition 64 • Assisted in the drafting and managed the passage of Proposition 64, The Adult Use of Marijuana Act, that legalized cannabis in California • Developed and continues to shape the laws and regulations for cannabis in California • Advises local, state and national governments on the development of cannabis regulations, including cities throughout California, and the countries of Canada and Mexico • Sits on the California Bureau of Cannabis Control’s Cannabis Advisory Committee which advises the State regulatory agencies overseeing commercial cannabis activities • Former board member of Californians to Regulate Medical Marijuana • Responsible for the compliance of over one million square feet of licensed cultivation • Currently under contract with the cities of Dixon and Benicia Police Departments, training city staff, police and code enforcement personnel on cannabis regulations, crime prevention strategies, crime prevention through environmental design (CPTED), and assisting with facility design review, security plan review, and both site and compliance inspections • Manages the compliance for over 200 cannabis licenses statewide • Managed government, public, community and regulatory affairs for one of the largest vertically inte- grated cannabis companies in the world • Legal and compliance professional with five years’ experience navigating compliance for the legal cannabis industry • Partner at a prominent Sacramento political consulting firm responsible for helping leading cannabis companies navigate regulatory and political compliance in California • Served in the Obama Administration’s White House Business Council Community Relations and Social Equity • Prominent leader of San Francisco’s social equity program development and creation of a Good Neighbor Policy • Former board member for the Coalition for Cannabis Policy Reform • Former board member of 420 Archives • Former California Coastal Commissioner • Founder of a community and public affairs firm that works on community relations issues statewide Marketing and Branding • One of the most prolific brand builders in the cannabis industry, responsible for developing one of the state’s top selling brands and executing the first legal consumption café in the country • Former Chief Marketing Officer for the most well-known dispensary in the country • Former Chief Marketing Officer of a publicly traded cannabis company Finances and Accounting • Financial advisor for three decades with a track record in cannabis finances • Founder of a large California CPA firm • Seasoned private equity finance executive with experience in finance and corporate development for large California cannabis operator 24 Fortune 500 Business Experience • Former Google and Snapchat executive responsible for more than 300 employees and 2 million square feet of construction • Former Chief Operations Officer of a Fortune 50 Retail Company • Former President of the nation’s largest natural foods distributor Cannabis Science and Medicine • Chair of the Cannabis Advisory Committee’s Cultivation Subcommittee • Chair of the Cannabis Advisory Committee’s Testing Subcommittee • Co-founder, executive director and board member of the International Cannabis Farmers Association • Board member for the California Cannabis Industry Association and Chair of the Agricultural Committee • Chair of the American Herbal Products Association Cannabis Committee’s Cultivation Working Group • Former board member of the Americans for Safe Access’ Patient Focused Certification Peer Review Board This depth and breadth of experience ensures we will operate a world-class dispensary that serves the Fresno community with core values rooted in our deep respect for—and understanding of—this distinct community, including a focus on wellness and education. Unlike outside interests, our proposed operation embodies and furthers the spirit of Fresno through our partnership between a decades-long resident and active community leader in Fresno and a team with proven operational experience to execute his vision. The team is buoyed by the expertise and community-orientation of a Community Advisory Board that will pro- vide meaningful ongoing input on our local operations. Ultimately, there is not a team better prepared to execute on the City’s vision for thoughtful, compliant cannabis operations than us, because for Steve, Fresno is home. SECTION 1.2 A budget for construction, operation, and maintenance, com- pensation of employees, equipment costs, utility cost, and other operation costs. 25 SECTION 1.5 Fully describe hours of operation and opening and closing procedures. Hours of Operations Per Fresno Municipal Code, operating hours will be limited to the hours of 6:00 am through 10:00 pm, 7 days a week, unless alternative hours of operations are authorized by the Chief of Police. Embarc may seek to modify these hours seasonally or after commencing operations based on analysis of customer traffic data to better meet the needs of patients and consumers and would collaborate with the City about these needs should they arise. Opening Procedures Embarc’s opening and closing procedures have been developed by our security, operational and compliance teams to ensure the protection of public and employee health, safety and wellbeing. These policies have been tested through Embarc’s existing operations and are thus a realistic model of functional best practices. 35 Opening shifts begin one hour before the shop opens to the public in order to ensure sufficient time for all opening procedures to be completed with attention to detail. Arrival & Exterior Inspection Prior to the first Embarc employee entering the retail premises, contract security officer(s) must be present. Thus, security is directed to arrive fifteen minutes prior to the first Embarc employee’s sched- uled arrival to conduct a visual inspection of the exterior of the premises. Next, the Opening Manager arrives. The Opening Manager will perform a visual inspection of the premises from the safety of his or her vehicle by driving all accessible perimeters of the premises. If any signs of forced entry, suspicious persons or suspicious circumstances are observed during this inspection, or if the security detail is not present, the Opening Manager will retreat from the property and summon the contracted private patrol operator or police, as appropriate for the circumstances. Entering the Premises and Disarming the Alarm Once both security and the Opening Manager are onsite, they will enter the store together. Upon entry, the Opening Manager will close and lock the lobby door behind himself or herself and will disarm the premises alarm. If the Opening Manager finds the alarm is not armed, he or she will exit the premises and the security team will clear the premises. Once the premises are cleared, an immediate investigation will be con- ducted to identify and mitigate the reason for the alarm’s condition on arrival. Given COVID-19 safety protocols, security and Opening Managers are screened as they arrive. This includes a temperature check utilizing a touchless thermometer and a symptom screening checklist. Preparing for Team Arrival Once the Opening Manager disarms the alarm system, security opens any security gates and window coverings. All access doors remain locked. During this time the Opening Manager prepares the site for opening shift employees to be granted access to the premises. This includes: • Performing a manual test of the premises alarm system in accordance with provider protocols • Checking that all door locks, cabinet locks and safes are in operable condition and free of tampering • Inspecting inside and outside the premises for signs of attempted security breaches • Checking cameras for functionality, network connectivity and unobstructed viewing • Turning on interior lights, where appropriate, and assuring all lighting is working properly • Clearing the premises of any slip, trip or fall hazards, and • Verifying that all emergency egress pathways are unobstructed. Opening Shift Employees Arrive Upon employee arrival, and only after the Security and Opening Manager have completed the tasks detailed above, opening shift employees may access the building via the secure employee access area. Electronic access cards ensure that employees are only eligible to enter the premises within one hour of the store opening and one hour of the store closing to prohibit after-hours or unauthorized access. This ensures sales associates cannot enter the store without security and management onsite. Furthermore, employees have different access levels based on their position. Access cards utilized by Guides will 36 only allow access to the employee limited access area but are not valid to access managerial areas and secure storage. Immediately upon entry, employees are screened for COVID-19 symptoms using a touchless thermometer and a symptom screening checklist. After passing this screening, employees will clock in on iPads in the back of house area. Preparing for the Day The opening shift team prepares the store by disinfecting all high-touch surfaces, dusting cases, cleaning all glass, cabinetry and displays, arranging store fixtures as necessary and setting up registers. Disinfection occurs in the restroom(s) and back of house during this time as well. Technology, including point of sale systems, receipt printers, barcode scanners, music players and the shop ATM are powered on, systems are booted up, and manual checks occur to ensure no technology glitches. Additionally, the Manager or Lead Guide ensures all laptops and telephones used by the team have charged overnight and are in their respective areas prior to store opening. During front of house set up, the Manager is in the secure room, double counting the cash drop from the previous night and recording it in the cash log for deposit. Once the deposit is confirmed, the Manager takes cash drawers out of the safe and counts each drawer to to start the day. The Manager walks these cash drawers from the secure room to the sales floor and hands drawers to individual sales asso- ciates to double count before they “open” their cash register terminal for the day. It is critical to include sales associates in this process to ensure they take accountability for proper cash handling and counting procedures. Per Fresno Municipal Code Sec 9-3310(5), a cannabis retail business may have only that quantity of cannabis and cannabis products readily available to meet the daily demand for sale on-site in the retail sales area of the premises. As such, limited inventory (5 pieces per item) is moved from the secure inventory room to secure storage on the sales floor to prepare for the day’s sales. The manager and inventory specialist load five of each SKU onto a cart, notate the movement of product from the “vault” to the “floor” in our point-of-sale system, and then roll the cart onto the sales floor. Guides unlock the floor storage units, place five of each SKU in the storage units on the floor, and then relock the storage units. When working collaboratively, this process requires approximately fifteen minutes. Opening activities are all encapsulated in an Opening Checklist that is laminated and physically checked off by the team daily as each task is completed. This ensures all tasks are adequately addressed and allows the team to work together to achieve shared goals by dividing and conquering to maximize cooperation and efficiency. Morning Huddle Once the Manager has completed all tasks in the secure room, he or she will go to the bulletin and white board area in the break room to confirm all notices are posted appropriately. The manager updates the “daily updates” whiteboard with relevant information. He or she also prepares for the morning meeting by reviewing notes left by the Closing Manager as well as the weekly morning meeting schedule. Just before opening, the team will conduct a morning huddle. This meeting is approximately ten min- utes long and covers topics such as the staffing and break schedule for the day, and floor assignments (register, reception, sales floor, delivery driver, etc.). We also utilize this time to talk about new product education, daily specials, and industry updates. These meeting topics are also added to a touchdown 37 sheet that is reviewed with each employee as his or her shift starts throughout the day, so even if an employee has a mid-shift or afternoon shift, they are provided this information. Once the meeting is complete, the Manager checks the shop voicemails and responds to any messages as needed. We have found that customers often leave messages asking for company information and/or stocking questions, and by committing to respond to every voicemail, we are building relationships and loyalty with customers. Take Your Positions The team usually spends the final minutes before opening to the public to do any last-minute cleaning, playing favorite playlists, chatting about new products, and providing product reviews. This time is critical to information sharing, which is helpful when assisting customers navigate our product selection. At opening time, security unlocks the front door and employees take their respective positions to begin welcoming patrons into the store. Closing Procedures Closing procedures typically take approximately 45 minutes depending on the size of the team. Closing proce- dures are overseen by a store manager and security officer with specific tasks for all employees. State law forbids any transactions from occurring after 10 p.m., so closing procedures begin onsite at 9:45 p.m. and are initiated with delivery beginning at 9:00 p.m. with no additional deliveries accepted after that cutoff time. For onsite purchases, beginning at 9:45 p.m., any customers approaching the facility are instructed that they may only enter and purchase cannabis if they are able to make selections and complete the transactions in compliance with the state mandated 10 p.m. cutoff time. In instances where a high volume of customers approach the business as closing nears, we have a policy of “fair but firm” that has worked well with our existing operations. • If customers approach the store with reasonably sufficient time to enter the facility prior to 9:50 p.m., and the store is able to provide service based on current occupancy, then the customer is permitted to enter with the understanding that if they are not able to complete a transaction prior to the deadline they will not be permitted to purchase any products. To accommodate this time restriction, once a customer has been checked in, he or she is assigned to a Guide to help facilitate a smooth and efficient shopping experience. • However, if continuing to accept customers jeopardizes our ability to maintain an appropriate ratio, or if we have concerns about the ability to meet the 10:00 p.m. cutoff, customers are turned away and encouraged to return (with a 10% discount) the following day. At 9:50 p.m., all customers in the store are instructed that they must select desired products and queue for payment. No additional customers are granted access to the facility. By 9:55 p.m., all transactions must be initiated such that customers can be walked to the door before the 10 p.m. closing time. Existing customers are allowed out of the premises as transactions are finalized. By 9:59 p.m. security ensures all customers have left the premises, locks the front door and secures the security gates over all windows. This ensures potential customers have no way to access the facility. We have found this process to be successful in maintaining strict compliance with all laws regulating trans- action cutoff times while also ensuring we are not turning away customers that arrive with sufficient time to procure product. 38 Once closed for business, all team members work together to execute closing procedures: Securing Inventory The on-duty Manager is ultimately responsible for securing cash and all products at the end of the workday, so that neither remain on the retail floor after closing. This process is collaborative, with Lead Guides and Guides working under the direction and oversight of both security and the on-duty Manager. At the end of each day all inventory is returned to the secure inventory storage room via rolling carts. SKUs on the floor are loaded by section of the store onto rolling carts, carted into the inventory room, and labeled as “On Carts” in the inventory management system (to ensure staff knows where they are at all times). This process allows Embarc to employ daily rolling inventory reconciliations as well as bi-weekly full inventory audits to prevent diversion. This inventory reconciliation occurs within the inventory room once the rolling carts have returned all SKUs on the floor to the secure inventory room for overnight safekeeping. The onsite Manager inputs the daily inventory reconciliation data into a spreadsheet to ensure visibility for the Opening Manager. Accounting The Closing Manager reconciles each cash drawer by closing the drawer and having the employee assigned to each cash drawer confirm that the cash number matches his or her sales numbers for the day. Including employees in the process of verifying their cash drawers is critical to instilling a sense of accountability. All cash is included in the daily tally, which is notated, bagged, signed by the manager, and kept in the safe as the “daily drop.” This drop is placed in a secure deposit bag in our safe, to be counted and confirmed a second time in the morning by a different Manager. Cleaning While the Manager is reconciling the day’s cash, the closing team is cleaning the shop. Floors are swept and mopped, shelves are dusted, and glass is cleaned. All counters and high touch surfaces are disinfected and sanitized. All technology is powered down, including the ATM machine and the music system. Manager Communications We have found that communication between our Managers and leadership is key to running a success- f ul business. At the end of each day, the Closing Manager sends an end of day email outlining a shift summary to ensure all Managers are apprised of relevant information. This email includes any staffing insights and/or trends they have observed throughout the day, as well as any reminders for the rest of the management team. With this daily communication, our management team is fully informed of notable instances that occur when they are not in the store. Securing the Premises A Manager collects all access badges, disinfects them, and places them in secure storage. Additional closing procedures performed by the Manager include: • Securing any records identified in the Information Security portion of Embarc’s Security Plan into their respective locking cabinets or filing systems • Logging out of any software, verifying password protection is enabled 39 • Verifying proper functioning and no obstructions of all surveillance cameras • Verifying functioning of exterior lighting, and • Verifying all relevant interior doors, cabinets and safes are closed and locked The Manager then turns off appropriate interior lighting, arms the premises alarm system, and walks out with the staff and security guard. Employee safety is imperative, and no employee is ever onsite without a security guard present. Closing employees are expected to never leave the shop for the night alone but rather to leave as a group and only with the security guard present. Members of the closing shift are asked to move their cars to the front of the shop during their last break so they do not have a far distance to walk. Security accompanies the group to each employee’s car and ensures everyone leaves the shop safely. Once employees have all departed, the Manager and security guard walk the perimeter, verifying all doors are secure before the security guard walks the Manager to his or her car for departure. The Manager is tasked with driving the surrounding area for suspicious persons, vehicles or circumstances (persons potentially lying in wait) and reporting any such findings to the contracted private patrol operator or police, as appropriate, for further investigation. Being Mindful After closing, Employees and Managers are trained to be cognizant of security risks while driving home. Perpetrators may falsely assume employees are traveling with cannabis products and/or currency from the store. Consequently, staff is instructed to watch for vehicles that may be following them, to vary their routes, and to have pre-designated safety zones (locations with heavy police/security pres- ence) identified along their path home for use in the event that they believe they are being followed. As stated above, opening and closing procedures are encapsulated in morning and evening checklists and overseen by the Opening and Closing Managers. The team practices these procedures for at least one full week prior to a new store opening for business as part of the new store opening training. This ensures the team has a full understanding of all protocols and policies and has ample time to ask any questions of the security or operational and compliance leadership teams to ensure an understanding of the importance of strict adherence to these procedures. COVID-19 Protocols: Embarc is honored to be considered an essential business during a time when so many businesses are struggling with closures. But with this essential status comes a responsibility to protect public health and safety in every way possible, both for our patrons and our employees who face exposure to hundreds of people a day. We are fortunate in that no employee of Embarc has contracted COVID during these tumultuous times—a testament to our rigorous protocols. These include, but are not limited to, the following: COVID Training: All employees must participate in a two-hour COVID training prior to initiating their roles in the store. This training details everything from CDC Guidelines to how to manage a patron who approaches the building without his or her mask. 40 Symptom Screening: All employees are required to pre-screen for symptoms prior to arriving at work and are immediately screened for symptoms upon arrival. This screening includes a questionnaire as well as a tempera- ture check using a touchless thermometer. All employees, including contract security guards, must undergo this screening prior to engaging in activities on the sales floor. Standard Operating Procedures: Combatting exposure requires strict adherence to all applicable laws, regula- tions and best practices as they are developed by federal, state and local governments, agencies and organiza- tions. As such, Embarc has developed a 37 page handbook with specific guidance and training pertaining to COVID-19 protocols, including detailed, step-by-step instructions for how to increase safety during regular activities including product intake and interaction with customers on the sales floor. Providing simple, easy to understand instructions is critical to ensuring COVID protocols become a lived value rather than a mandate. Strict Cleaning Procedures: Employees must maintain strict cleaning protocols, tracked on a cleaning log and completed no less than every thirty minutes. This cleaning includes disinfecting all high touch surfaces in the front and back of house as well as anything a customer touches (PIN pad, countertop) between every customer. Personal Protective Equipment: Masks are mandatory for all staff and patrons. Masks, hand sanitizer and gloves are available for everyone to ensure full compliance. Reduced Occupancy and Social Distancing: We have significantly reduced occupancy to ensure patrons are able to maintain appropriate social distancing. Both our Security and Management team oversee activities on the retail sales floor to gently correct patrons should they violate these mandates. 41 SECTION 1.6 Daily operations. With as much detail as possible, the Business Plan should describe the day-to-day operations which meet industry best practices. This should include at a minimum the following criteria for each permit type in which you are applying for a permit. Given the detail provided in other sections of this proposal, we have provided an abridged version of our busi- ness and operational plan below. Additionally, we have included responses to the specific questions included in Section 1.6.1 (i)—1.6.1 (vi) where noted. This abridged business and operational plan contains the following: •Company Overview • Mission Statement • Values •Proposed Project • Project Overview • Local Headquarters • Location Selection •State and Local Compliance •Licensing Requirements • License Posting Requirements • Operations • Compliance Through Design • Approachability by Design • Technology • Banking • Safety and Security • Daily Operations • Requirements While Not Open for Business • Site Requirement • Age Restriction • Access • Verification of Medical Patients • Employee Badge Requirement • Visitors • Marketing and Advertising Placement Compliance • Marketing and Advertisement Placement Procedures • Marketing Cannabis Goods as Alcoholic Products • Display of Cannabis Goods • Cannabis Goods for Sale • Prohibition on Packaging and Labeling by a Retailer • Cannabis Goods Packaging and Exit Packaging • Sale of Non-Cannabis Goods • Free Cannabis Goods • Daily Limits • Customer Return of Cannabis Goods • Inventory Management 42 • Track and Trace System • Track and Trace Compliance • Track and Trace Reporting • Loss of Connectivity • Track and Trace System Reconciliation • Record Retention • Inventory Control • Receiving Shipments of Inventory • Storage of Inventory • Inventory Documentation • Inventory Reconciliation • Retailer Premises to Retailer Premises Transfer • Product Storage and Recalls • Inventory and Records • Record Storage • Average or Expected Amount of Cannabis Storage • Currency Security • Transparency with the City • Mitigating Adverse Impacts on Community • Employee Training Overview • Community Engagement • Proposed Schedule Company Overview Embarc is a retail dispensary, wellness brand, and delivery cannabis business that is dedicated to providing a best-in-class cannabis experience for Fresno residents and visitors. We are a California-based, community-ori- ented team of dispensary operators who are fundamentally committed to a long-term business, operational and management plan; a plan that measures success over decades, not years. Our operational and business framework is designed to exceed industry best practices and standards for business sustainability and serves as a model for what dispensaries across the state and country can and should be. This model is predicated on concentric circles of positive influence that begin with our employees and customers and extend outward to our community as a whole. We are driven by several business management principles that are instrumental to these long-term goals. At the internal and employee level, we focus on training, compliance and investment in employees to achieve business sustainability. The positive and compliant internal culture we create will provide the foundation for positive influence at the customer level, which is further supported by our focus on high-quality products and a commitment to an accessible customer experience throughout all of our operations. At the external level, our goals will be achieved through our community presence, responsible marketing, customer education, and the ability to adapt to market changes. • Rigorous Training • Compliance • Investing in Employees • High-Quality Products • Commitment to Customer Experience • Positive & Engaged Community Presence • Responsible, Education-Centric Marketing Commitment to Customer Experience Embarc provides safe access to quality cannabis in a friendly and professional retail environment that focuses on health, wellness and high CBD, low THC products. The dispensary layout is designed to be warm, approach- able, and inviting to our customers. 43 A key tenet of the business is education; Embarc will educate consumers about safe consumption, benefits of cannabis, and preventing youth access. We will operate in accordance with state and local laws and maintain strict internal policies and procedures to ensure compliance and transparency in our operations for the safety of our customers, employees and community. Our target audience prioritizes a healthy lifestyle and sees cannabis as a component of their overarching appreciation for recreation, relaxation and wellness. These are active and engaged community members who appreciate quality, innovative products that enrich their lives and relationships. About two decades ago my father suffered multiple brain aneurysms and is fortunate to have survived. Experimental surgery and almost a year of recovery in the hospital ensued. He was put on anti-seizure medication to manage the seizures caused by the surgery, but the medication had horrible side effects. It was then suggested he try cannabis to alleviate some of the side effects and we were astounded by the results. That experience showed me cannabis is about more than getting high—cannabis is about wellness, whether that’s to help you get a better night’s sleep, or to take the edge off after another day of Zoom calls. It is this reason that I am so excited to be part of bringing this approachable, wellness-focused approach to cannabis to Fresno. Dustin Moore, Embarc Compliance Our business plan is designed to comply with the Fresno Municipal Code, all applicable rules and regulations, and all state laws. It is a realistic model of operations developed through a collaborative process that leverages the expertise of our seasoned leadership team, industry specialists and existing cannabis operations. As the drivers of cannabis policy and regulatory development at the state and local levels throughout California and in countries across the world, the Embarc team brings the most extensive experience managing operational and regulatory compliance plans in the cannabis industry. It is this compliance and regulatory expertise that serves as the backbone of our business approach, coupled with over three and a half centuries of combined relevant experience in business development, operations and management. These strict operational procedures were implemented with our first operational dispensary and continue to be refined as they are informed by our existing operations. That is the most critical component of compliance—it requires more than a compliance memo and audits; true compliance is predicated on a commitment to ongoing training and implementation while also continuing to innovate and refine operations to ensure best practices are easily implemented, maintained and become a lived value rather than simply a mandate. Experienced Team of Operators Our team’s depth and breadth of applicable experience ensures we will operate a world-class dispensary in Fresno with core values rooted in our deep respect for—and understanding of—this distinct community, including a focus on health, wellness, community education, diversity and inclusion. Unlike outside interests, our proposed operation embodies and furthers the spirit of this community through everything from our strategic partnerships to day-to-day operations. Embarc combines the benefits of local ownership and operation with a proven track record and model from existing operations that will fastidiously implement our start-up plan and begin safely serving patients and customers faster and more efficiently than other operators. 44 Embarc Mission Statement We redefine the interaction between consumers and cannabis, focusing on health, wellness and approachability rather than the traditional emphasis on ‘getting high’. Most importantly, we believe a cannabis company can do well while doing good—integrating into and enhanc- ing the local community while operating with integrity and transparency. Values Embarc effectuates and implements this mission through our values that serve as the basis for everything we undertake as a company: COMMUNITY FIRST We create meaningful connections with our customers, our team and our communities by being transparent, honest, accountable and inclusive. While cannabis has existed within communities for decades, legal, regulated cannabis is still an emerging market. As such, communities are grappling with how to best integrate commercial cannabis activities into existing neighbor- hoods, balancing the economic opportunity this industry represents with a desire to protect public health and safety. Embarc understands that operating such a business is a privilege and not a right and that a suc- cessful business model is thus predicated on the ability to consistently engage the community to ensure communication, transparency, integrity and collaboration. By putting the community first, Embarc ensures a positive relationship with local government, community leaders, and the neighborhood, ultimately allowing the company to give back to the community in meaningful ways. ENRICH RATHER THAN ALTER Part of putting the community first means understanding how to meet the unique needs and priorities of every individual that walks through our doors. We believe cannabis can enrich lives and enhance experiences. We enjoy connecting people to the plant and are thoughtful when helping people navigate their personal cannabis journey. Whether a ‘medical’ or ‘adult use’ consumer, all cannabis is about wellness and is just one component of an individual’s broader health and wellbeing journey. Whether using cannabis for a specific ailment, general aches and pains, anxiety or sleeplessness, at its root cannabis use is about enriching one’s life. We believe in embracing that core truth through a focus on cannabis as a way of enriching one’s life and integrating into one’s existing lifestyle, rather than altering it. Our product types focus on high CBD, low THC ratios and a variety of topicals to address aches and pains. We will offer the fullest line of high-quality, consciously crafted cannabis products available, including sustainable flower, pre-rolls, concentrates, edibles, topicals, tinctures, beverages and administer- ing tools. This ensures use of cannabis achieves our goal of enrichment—enrichment of the self, one’s lifestyle, and the broader community. EXPERIENCE MATTERS. BEST PRACTICES MATTER. Embarc is comprised of local community members and business leaders with unparalleled experience operating compliant retail dispensaries and navigating stringent regulatory environ- ments. This expertise is integral to the development and execution of a new type of cannabis dispensary—one that communities can be proud to host. 45 BE AUTHENTIC, ALWAYS We aim to humanize all aspects of our industry—from the cultivators to the brands, to our employees and consumers. We believe in doing the right thing and defaulting to honesty and integrity in all we do. CREATE ACCESS FOR ALL Cannabis is not a luxury or a premium product; it is a tool to enhance life and enrich experi- ences. We strive to be approachable for all by respecting and valuing people of all backgrounds and by providing an experience that is accessible no matter who you are, where you’re from or how experienced you are with cannabis. LIVE OUR MISSION To provide a sense of connection and togetherness through cannabis, wherever you are. Proposed Project Embarc is committed to providing the Fresno community with a comprehensive, compliant, and approachable network of licensed Commercial Cannabis Businesses that are designed to complement each other while serving as an active and engaged community partner. Project Overview As previously noted, Embarc is committed to creating a significant presence in the City of Fresno, both through retail and delivery operations as well as through the creation of a corporate headquarters. Specifically, our plan includes: 1. Multiple proposals for retail and delivery operations in the City of Fresno, strategically located to achieve optimal geographic disbursement that gives Embarc the ability to efficiently service the entire Fresno market and provides maximum benefit to the City in terms of tax and community benefit dollars. 2. The development of a local headquarters to oversee our regional operations, which would include three retail and delivery operations (if successful during this application period), as well as our princi- pals’ 24-acre cultivation site in the City of Mendota. This cultivation will be the backbone of our supply chain in Fresno to ensure we sell cannabis by Fresno for Fresno. We intend to locate our corporate headquarters within a cannabis innovation hub. Our co-location is strategic in nature, allowing us to provide ongoing financial, volunteerism and human infrastructure support to his venture. This commitment is meaningful—we have committed in capital to this multi-pronged effort, that will create more than 100 local jobs and of dollars in local economic activity, resulting in a significant economic impact for the City of Fresno. Each proposed project will include construction and/or building improvements for a vacant, soon to be vacant building, or vacant land to ensure the creation of a safe, secure, and approachable retail experience that ensures patients and consumers feel welcome and respected. Local Headquarters We have already secured a location for our corporate headquarters where our corporate team will co-locate with a local incubator campus that is being proposed by another applicant during this application period. This keeps our corporate staff local and more importantly, close to the participants of the incubator program to provide meaningful financial and human resources to mentor social equity applicants. 46 Selecting the Best Location Embarc has followed the ordinance process closely and understands the City’s desire for operators that stand ready to execute on their proposal without delay. The Embarc team is comprised of leading entitlement experts in the state of California. Senior Vice President of Regulatory Affairs Kevin Schmidt and Chief Compliance Officer Dustin Moore—both partners at prominent government affairs firm Axiom Advisors—have entitled dozens of projects for cannabis and traditional busi- ness uses throughout California and across the country. During his tenure with Lt. Governor Gavin Newsom, Kevin sat on the California State Lands Commission, overseeing project entitlements worth billions of dollars. Additionally, as existing operators that have successfully navigated the Conditional Use Permit process for cannabis retail and delivery uses in other communities, we understand the importance of getting site selection ‘right’—not just by identifying and securing a properly zoned property, but also by ensuring a location is supported by the community. To demonstrate our ability to quickly and efficiently obtain a property, Embarc has provided a proof of funds with far beyond required capital in this proposal. The City can be assured that there is no economic barrier to operationalizing quickly and efficiently if selected to move forward. Embarc has a track record of serving as a strong and engaged community partner, providing a net benefit to the surrounding community in its existing operations, as well as a proven commitment to strong labor partnerships throughout the construction and operations of the business. Embarc is the right team to execute compliant, best-in-class dispensary operations in a timely manner because we have done it before. For example, Embarc Tahoe finished ahead of our timeline and an entire quarter ahead of the next licensed operator to open their doors. We stand ready to move forward quickly and efficiently to ensure timely operationalization if fortunate enough to be selected as a licensed Commercial Cannabis Business in the City of Fresno. State and Local Compliance Our management team will ensure that Embarc Fresno is operated in a manner compliant with all applicable state and local laws, including the Medical Cannabis Collective Laws, the Medical and Adult Use Cannabis Regulation and Safety Act, any subsequently enacted state law or regulatory, licensing or certification requirements, and any specific additional operating procedures or requirements which may be imposed by the City of Fresno. Operating a cannabis business is a privilege not a right, and strict adherence to all laws and regulations is a cornerstone of our ability to operate responsibly. Given this dynamic, the Embarc team approaches compliance through the ethos that we are only as strong as our weakest link, i.e. having the best standard operating procedures and compliance checklists in the world is meaningless if your team does not understand, implement, and live compliance through consistent action. That means conformance with all laws starts with meaningful ongoing education. Our cannabis regulatory development experience has taught us that true compliance requires a combination of skills and ongoing dedication—lawyers and regulatory experts shaping the policies, procedures and checklists, as well as human resources and training professionals that translate technical language into practical tools to support daily operations. As such, Embarc maintains a robust team dedicated to ensuring ongoing compliance at every level of the organization and leverages an ongoing feedback loop from the store team on what is working and where improvement is needed to continuously inform how we enhance our training, protocols, checklists and other compliance tools to be most effective. 47 Through strict operational procedures, Embarc employs the following strategies and tactics to maintain compliance: 1. A Holistic Approach Detailed standard operating procedures are developed by a six-person compliance team including the Chief Compliance Officer, Senior Vice President of Regulatory Affairs, Director of Compliance and members of the legal team. These standard operating procedures include topic-specific guidance as well as actionable documents for use in the stores based on operational needs. The most critical component of taking a holistic approach to compliance is understanding how to translate verbose legal mandates into actionable intelligence for our team. Key components of this holistic approach include: • A detailed compliance memo developed for each retail and delivery location specific to the unique needs of each business • Standard Operating Procedures covering every aspect of retail and delivery operations, including such topics as opening and closing checklists, order intake checklists, order processing checklists and more • Daily, weekly, quarterly and annual compliance checklists • Consistent coordination between the compliance team and the store leadership team to provide additional tools and resources based on on-the-ground needs • Ongoing compliance audits to identify any areas where confusion may occur or where additional resources must be allocated to maintain compliance • Ongoing in-store compliance training before every store opening and during regular team meetings throughout our day-to-day operations Given the importance of compliance, Embarc does not take the results of compliance audits lightly. If any deficiency is identified, the deficiency will be logged, recorded, and remedied. Within 24 hours of any identified deficiency, the employee who conducted the audit will meet with the Chief Compliance Officer to discuss the circumstances of the deficiency, how it was remedied, and how it will be avoided in the future. If after this meeting the Chief Compliance Officer deems it necessary, a revised Standard Operating Procedure will be pushed to all stores effective immediately and an all-staff training on the SOP will occur during each employee’s next scheduled shift. Importantly, Embarc seeks to strike the balance between aggressively pursuing strict compliance with creating a safe space for the team to be engaged in compliance ask questions, suggest revisions, and otherwise feel that compliance is approachable rather than intimidating. For that reason, compliance is treated as an ongoing conversation. 2. Rigorous Ongoing Education In order to effectively implement compliance protocols and maintain ongoing compliance given the stringent rules and regulations in place, compliance must be a lived value that is reinforced through consistency. Providing this consistency means implementing ongoing compliance education that keeps standard operating procedures top of mind and a lived value rather than an aspiration or a check box on a list of ‘to dos.’ • Train the Trainer: Given the General Manager is ultimately responsible for the day-to-day activities and performance within the store, Fresno’s General Manager will receive in-store training at one of Embarc’s Bay Area locations prior to training the team and opening the store in Fresno. Real world experience operating under Embarc’s specific protocols and procedures is vital to living compliance rather than 48 simply understanding it. Furthermore, Embarc’s Chief Operating Officer, Vice President of Retail and managers from operating stores will attend and co-lead the new store orientation and training alongside the Fresno General Manager to provide best practices based on practical experience. This breaks down barriers and facilitates information sharing among Embarc leadership across the state and provides resources during training to improve the operationalization of the store. • Significant compliance training as part of the comprehensive two-week training prior to opening a new store • Ongoing compliance education, including but not limited to compliance quizzes and quarterly re-trainings. 3. Third Party Compliance Software for Self-Auditing • Our use of compliance software and self-auditing tool Simplifya as an additional resource for store leadership and staff is a critical component of maintaining compliance. This software makes man- datory audits easy to use and integrated within our regulatory and compliance structure. Successful audits are incentivized through a compliance metric tied to bonus compensation. This comprehensive approach has proven successful to date, as Embarc has received no state or local compliance violations for existing operations, and no violations across any cannabis business any employee has worked for during their tenure. Licensing Requirements Pursuant to California Business and Professions Code Section 26050, we will apply for a Type-10 license from the state upon approval of a retail and delivery dispensary. Embarc will also obtain the necessary cannabis tax permitting from the California Department of Tax and Fee Administration in accordance with California Bureau of Cannabis Control (“BCC” or “Bureau”) regulations. Embarc will conform with all local licensing requirements including obtaining local licensing that includes an operating permit for commercial cannabis retail and delivery, a conditional use permit, development agreement or public benefit agreement to memorialize the promises made in our community benefit proposal and a business license. License Posting Requirement Embarc will prominently display the license on the licensed premises where it can be viewed by state and local agencies. The license will be displayed in an area that is within plain sight of the public. Operations Embarc has implemented industry-leading best practices across our dispensary operations. These best practices have been honed and perfected over nearly two decades of collective operational experience with some of the state’s most respected dispensaries, along with input from our team of advisors who have been responsible for more than 2,000 retail stores across the globe, and valuable lessons learned from successfully operating Embarc’s retail store in South Lake Tahoe. These practices are integrated into Embarc’s Standard Operating Procedures by utilizing Simplifya, the fore- most cannabis compliance software provider in the world. By leveraging the expertise of our industry-leading team and combining it with preeminent cannabis retail compliance software, we ensure every section of our Standard Operating Procedures are up to the highest standards of state and local regulatory compliance. 49 Best practices and operating procedures are contained in our business plan, operating plan, employee hand- books, employee training program and numerous other resources. In total, there are over 450 pages of material specific to Embarc’s best practices, policies and procedures. Given that many of these materials are proprietary, because this document is subject to a Public Records Act request, and in deference to the need for succinct application materials, we have included a detailed overview, summary, and description of how Embarc’s best practices have been included into the standard operating procedures. The key themes from Embarc’s robust library of information are as follows: • Educating consumers starts with educating employees • Creating a safe and approachable environment is critical to facilitating communication with patients and consumers • Provide first-time customers with a more in-depth education on delivery method, dosage and direct them to products that match their experience level • Provide all customers with a high-quality, unintimidating experience • R igorously enforce identification checks for all customers • Educate customers on safe storage of their products at home • Provide employees and customers regular updates on cannabis policy and safe usage • Provide the City (e.g., Police Department) with regular updates on safety and operations • Take all necessary steps to prevent diversion, theft, and loss of product • Provide rapid responses to neighbors and community members to fully address comments and concerns • Be more than a business in the community—approach each day with the desire to act as a true partner to the City and treat each customer as a friend or a neighbor Safety and Compliance Through Design Embarc has approached the proposed floor plan, including the check in area, through the lens of customer flow, security and compliance, meaning the physical design and layout of the store contribute significantly to the overall safety and compliance of the facility and daily operations. However, safety is achieved through a combination of intentional design and the appropriate use of human resources in ways that design alone cannot singularly manage. Rather, we consider the key to preventing crime is by creating sufficient time and distance fac- tors, coupled with removal of opportunities, to effectively render the target unattractive or unavailable to offenders. While the typical industry practice is to station a security guard (who usually is equipped with a key to the premises) outside the premises, Embarc’s security team views this practice as not only detrimental to the store’s public image, but more importantly, it creates the potential for hostage-taking and robbery. Tasking guards with checking identification all but ensures guards will remain oblivious to approaching threats. Preoccupying guard hands, eyes and minds with age calculations, documents and door controls removes their perception and reaction time to a threat. Access control is a function best left to a properly designed, hardened environment and available technologies controlled by persons placed in protected positions, as you will see throughout the design of our store. 50 1. Upon entering the secure screening area, the customer will be greeted while his or her identification is verified to ensure compliance with state law requiring that no underage person will enter a commercial cannabis business premises. The receptionist will record the identification via a scanning feature on Treez, Embarc’s track-and-trace/point of sale software. Once all information has been verified, the customer will be permitted to enter the secure waiting area. 1 3 1. GREETED Guests enter, are welcomed, un- dergo identification verification, and are permitted to remain in the waiting area. 2. INTRODUCED Guests are then greeted by a Guide and escorted to sales area. 3. GUIDED Guide takes guest through product selection, answering questions and pro- viding individualized suggestions. 4. CHECKOUT Guest selects products which are procured by Guide and then paid for at the point-of-sale. 5. EXIT Guests are thanked for coming and exit through the secure exit area. 11.30.2020RD02 4 RECEPTION 4 5 2 51 2. In the waiting area, the customer will be greeted by a sales associate (a “Guide”) who will escort them into the retail are where the guide will assist in product selection. During this process, the sales associate will use an internal standardized consultation protocol to obtain information about the customer’s consumption experience. This information is used by the Guide to tailor education, discussion and product suggestions based on each customer’s unique experience level with cannabis. Guides are extensively trained to recommend low dose products that limit the psychoactive effects of cannabis to further ensure the highest levels of public health and safety for the community. 3. Once the customer has selected products, the Guide will obtain the products and facilitate the transaction at a point of sale station. Guides will record the sale via the Treez software system. Treez will alert Guides if the customer has already exceeded their daily limit as defined by state law. If Treez indicates that the customer has already exceeded his or her daily purchasing limit, the Guide will not sell additional prod- uct to the customer that day. 4. Currently, state law requires that a product either be in child- proof packaging or that it leave in a child-proof exit bag. That said, some products are only child-proof upon purchase and not resealable. For that reason, all of the products we sell will be placed in an opaque child-proof exit bag before they are allowed to be carried out of the store. We will also remind customers to always store their cannabis products in the resealable and opaque child-proof bags to prevent accidental youth access. The easily identifiable exit bag allows Security personnel to monitor customers exiting the building. Customers will not be permitted to loiter on the property. Approachability by Design While customer flow is critical to safety and compliance, it is also critical to approach the layout, flow and aes- thetic to create approachability throughout every aspect of the consumer experience, from the physical design to the engagement level with staff while shopping in a store or at one’s doorstep while receiving a delivery. Making a cannabis dispensary approachable is about more than the retail environment —it requires breaking down barriers including the stigma associated with cannabis and insecurity about how to navigate the shopping experience. Eliminating these barriers and creating authentic and approachable spaces is critical in helping patients and consumers feel comfortable exploring cannabis options and identifying the products that best meet their needs. Cannabis is not a luxury product that should only be available in high-end boutiques, nor should it be a shame- ful secret, only available for purchase in dark, dingy spaces that make one feel embarrassed for walking inside. Creating an approachable experience is predicated on the execution of a warm and welcoming physical space, thoughtful experiential design, and well-trained staff that provide individualized attention. 11.30.2020RD02 6 LOUNGE 11.30.2020RD02 8 RETAIL ENTRY 11.30.2020RD02 12 RETAIL 52 To achieve approachability through design, Embarc has partnered with Rapt Studio, a pre-eminent experiential design studio focused on creating emotionally compelling, authentic experiences that —through relevant execution —bring Embarc’s ethos and authenticity to life. Rapt Studio brings more than a century of combined design experience to work in the development of Embarc’s retail concept. The team has executed spaces for some of the largest and most well-regarded retailers in the country, including The North Face, Vans, Salt Surf and Dollar Shave Club. They bring unparalleled experiential design experience and an innovative experience-first focus to Embarc’s retail execution. Working collaboratively, Rapt and the Embarc team have developed an experiential retail model for the proposed retail storefront that centers around thoughtful design to facilitate meaningful customer engagement. Cornerstones of this design include: • Execution of a holistic retail experience rather than simply a functional design • Facilitation of the space for multi-purpose use, ranging from quick grab-and-go exchanges for seasoned shoppers to one-on-one engagement for new or curious customers What are examples of experiential design and execution? It all comes down to focusing on the ways in which the in-store experience can stand in stark contrast to the typical dispensary experience today which is often cold and detached. Instead, we focus on: • Greeting not registration • Personal not procedural • Consultative not transactional COMMON EXPERIENCE EMBARC EXPERIENCE Functional only Holistic experience Transactional —you’re a customer Welcoming —you’re a neighbor and friend High pressure sales environment Evokes safety and acceptance Feels cookie cutter Feels familiar and integrated into community Technology This experience is bolstered by a robust a technology stack that ensures the business is not only efficient and enjoyable but continuously compliant as well. Technological integration is critical to Embarc’s ability to facili- tate a seamless customer engagement strategy across all components of the business model. Some of Embarc’s key technology partners include, but are not limited to: Inventory Management, Sales and Compliance: • Embarc utilizes Treez as its point-of-sale provider. Treez is an enterprise-quality retail management software serving the leading dispensaries across the United States. Treez point-of-sale software man- ages and stores transaction information including records, reports, manifests, and any other documents generated by the business. Treez is an integrated software platform that automatically enforces best practices with a focus on compliance and loss prevention. 53 The system utilizes an Application Programming Interface (API) to facilitate a direct online connection to METRC, the State’s Track and Trace platform. This enables Embarc’s sales data from Treez to be uploaded directly to METRC, reducing risk of diversion, loss and theft, while maintaining the integrity and safety of cannabis products as they move through the supply chain. • I Heart Jane: I Heart Jane provides a complete e-commerce solution for selling cannabis online for pick-up and delivery, which is more critical now than ever with COVID-19. This technology embeds directly into Embarc’s website to ensure address and age verification and purchasing limits, ensuring that our orders are 100% compliant with State law. • OnFleet: OnFleet is a logistics management software and route optimization platform to facilitate delivery. OnFleet’s platform includes a web-based dispatching and analytics dashboard, driver app, and a recipient-facing tracking page for delivery services. OnFleet is a critical component of ensuring the most efficient routes are taken to deliver. Market Insights: • HeadSet: Headset integrates into our point of sale systems, providing critical market intelligence and insights to help us optimize our ordering and customer flow management based on real-time intelligence. • BDS Analytics: BDSA produces cannabis industry market trend reports, analyses and cannabis con- sumer research. BDSA focuses on which products consumers are buying, and what the competition is in the industry. This data informs inventory management decisions. Consumer Marketing: • Avochato Chat: Avochato facilitates our online and text message interactions with customers to ensure our Anytime Guides are available to answer questions from customers who may not want to come into the store to understand products. • MailChimp: Email marketing platform that will allow Embarc to communicate effectively with seg- mented audiences, allowing us to cater to specific groups to provide relevant information. Employee Education and Training: • Easy Llama: Easy Llama provides engaging and effective training programs that meet California’s mandatory training requirements for preventing discrimination and harassment training. Easy Llama’s programs ensure our employees learn how to be more aware of discrimination and bias in the work- place, as well as gaining essential skills for creating a harassment-free workplace. • Gusto: Our HR, Payroll and Benefits platform that automates employee onboarding, benefits admin- istration and payroll services. In addition, Gusto ensures Embarc is fully compliant with all tax filings and employee services, providing us with on demand HR support and resources. We also run a monthly anonymous survey each month through the system to gauge employee satisfaction in everything from teamwork to management practices and work life balance. • Simplifya: Provides tools to help proactively ensure state and local level compliance. Through the platform, we are able to schedule, assign and track tasks required to manage and maintain compliance. As regulations are updated, changes are flagged to us, ensuring we’re constantly in compliance. • Classroom: We have built an internal online Classroom to house all of our cannabis and brand educa- tion resources. Employees can access brand decks, education articles and quizzes on their own time, as well as when they are assigned directly to them as part of our ongoing education and training program. 54 Banking Embarc is fully banked with Salal Credit Union, a Better Business Bureau-accredited business with an A+ rating and NCUA-insurance. Embarc’s business model is predicated on being a committed community partner that serves as a model business that the community can stand behind. Embarc prioritizes transparency, accountability and integrity in all that they do. This is vital for us in providing banking services in such as nascent industry, and it is vital for the communities, landlords and non-profit organizations that they partner with to execute their vision. Robert Starkey, Salal Credit Union Additionally, Embarc has partnered with Pos-a-Bit, a fully compliant, debit and credit card payment solution. As a result of our debit and credit card capabilities, Embarc has seen a more than 50% reduction in the number of cash transactions, dramatically reducing the amount of cash we have onsite at any given time. While many cannabis dispensaries are cash only —a liability, Embarc is committed to public health and safety through partnership with Posabit to provide fully compliant electronic payment solutions for customers. Jon Baugher, Chief Revenue Officer, POSaBit We will incentivize consumers to use credit and debit cards by offering a discount for cashless transactions. When cash drawers exceed their permitted limit, we utilize a timed cash smart safe that: • Streamlines the cash management process, increases accuracy, minimizes theft and reduces cashier error • Provides full visibility to cash deposits from multiple locations • Asset protection through superior AMSEC hardware, including anti-spread deadlatch locks, heavy duty bolts, anti-pry door jams, and steel that is one-half-inch thick • Encrypted data communication and time locks/delays for ultimate software security • Burglary alarm (output signal) and duress hold-up alarm (silent signal) • Remote management via exclusive CashWizard admin and ethernet, cellular or WiFi connection • Data transfers from the safe to the cloud, exportable to multiple “le formats and devices • Custom reporting and alerts featuring all relevant data Safety and Security Embarc has developed a thorough Security Plan which adheres to our philosophy of fair but firm. This Security Plan is aimed at preventing crime and nuisance, including comprehensive video surveillance, comprehensive alarm systems, security guards and patrol, exterior lighting, motion sensors, and more. Our dispensary floor plan was also designed to facilitate ease of circulation, flow of customers, and the protection of public health, safety and security. While the Security Plan is too comprehensive to be included in the business plan, it is summarized in Section 5. Daily Operations Requirements While Not Open for Business A manager will be on the dispensary site at all times that any other person is on the site, with the exception of security guards who are authorized to be onsite at any time. All of the entrances into Embarc will be locked from the exterior at all times with entry controlled by dispensary personnel, provided that such secured areas do not violate the emergency egress requirements in the local Building Code. 55 At any time the business is not open for retail sales, Embarc will ensure that: a) The licensed premises is securely locked with commercial-grade, nonresidential door locks; b) The licensed premises is equipped with an active alarm system which will be activated when Embarc or its employees are not on the licensed premises; and c) Only employees of Embarc and other authorized individuals are allowed access to the licensed premises. Authorized individuals include individuals employed by the licensee as well as any outside vendors, contractors, or other individuals conducting business that requires access to the licensed premises. Embarc’s opening and closing procedures clearly outline and delegate responsibilities to managers, guides and security personnel to ensure the facility remains safe and compliant. It is the responsibility of managerial staff and security personnel to secure the facility prior to leaving for the night. This process is further detailed in Section 1.6.1 (a) and in Section 5. Site Requirement Embarc will have a lobby waiting area at the entrance to receive persons and to verify that they are members or are otherwise allowed to be on the dispensary site. As detailed above, guests that enter the facility are imme- diately welcomed by staff who conduct an identification verification to verify the age of each customer. Once an approved government-issued ID is checked and age is verified, guests are able to remain in the waiting area where a Guide will immediately greet them and escort them into the sales area. Embarc will have a separate and secure area designated for selling cannabis, cannabis products, and cannabis accessories that does not violate the emergency egress requirements in the local Building Code. The main entrance will be located and maintained clear of barriers, landscaping, and similar obstructions so that it is clearly visible from public streets or sidewalks. As the guest is escorted into the separate and secure retail area, the Guide will conduct a ‘guided’ greeting process, which allows the Guide to casually and conversationally ascertain the guest’s experience level and desired education for that visit. Age Restriction Embarc will only employ persons at least 21 years of age. Employees or persons retained by the retail store to work or to handle cannabis goods at any time will be at least 21 years of age. Access To ensure compliance and safety protocols, as well as to ensure the customer has ample access to a Guide to answer any questions about products, at least two employees will be physically present in the retail area at all times when individuals who are not employees of the licensed retailer are in the retail area. All sales of canna- bis goods must take place within the retail area except for cannabis goods sold through delivery. Please see Section 1.6.1 (i) for detailed age verification protocols. Employee Badge Requirement All agents, officers, or other persons acting for or employed by a retail store will display a laminated or plastic-coated identification badge issued by the retail store at all times while engaging in commercial cannabis activity. The identification badge will, at a minimum, include the retail store’s “doing business as” name and license number, the employee’s first name, an employee number exclusively assigned to that employee for identification purposes, and a color photograph of the employee that clearly shows the full front of the employee’s face and that is at least 1 inch in width and 1.5 inches in height. 56 No employee may work without a properly maintained and visible employee badge. Badges for non-managerial staff are kept onsite during non-working hours and secured in the manager’s office to ensure no accidental misplacement or intentional attempt at duplication. Embarc employs progressive discipline should a non-mana- gerial employee remove his or her badge from the property. Visitors Any person other than managers, staff, security personnel or customers who are inside the Embarc facility will sign in, wear a visitor badge, and be escorted on the site by a manager, or designee, at all times. Visitors may include: • A contractor, vendor or service provider authorized by Embarc’s agents to be on the licensed premises • Another licensee or that licensee’s agent(s) • Government officials • Tour groups, if applicable and as permitted by the Bureau and local jurisdiction All visitors will be required to conspicuously wear a visitor badge during the entirety of their visit. Visitor badges will be numerically assigned and printed on a colored medium. Visitor badges will be audited daily by the Head of Security. In the event that a visitor badge is not recovered or is deemed missing, all visitor badges of that color will be destroyed and replaced with a new color. Embarc has strict standard operating procedures governing the admittance of visitors. These procedures will be performed at all times when a visitor is seeking access to a limited-access area within the retail facility. Entry into limited-access areas is only possible by use of a valid keycard with the appropriate permissions. Anyone not employed or contracting with Embarc that is granted access to a limited-access area will be escorted by an autho- rized Embarc employee at all times while within the limited-access area. Only employees with assigned permis- sions to the limited access area may escort the visitor(s). Acceptable forms of government issued ID include: • A document issued by a federal, state, county, or municipal government, or a political subdivision or agency thereof, such as a valid motor vehicle operator’s license, that contains the name, date of birth, physical description, and picture of the person • A valid identification card issued to a member of the Armed Forces that includes a date of birth and a picture of the person • A valid passport issued by the US or by a foreign government Access to limited access areas within Embarc’s retail facility is restricted to Embarc employees who have been granted appropriate retail access permissions, however, non-employee individuals who have a legitimate reason for entering the limited-access area may be granted limited and supervised access on a case-by-case basis. Embarc and Embarc’s employees will report to the Bureau and local authorities any discovered plan or act by a visitor to: • Commit theft, burglary, underage sales, diversion of cannabis or cannabis products or other crime related to Embarc’s operations • Compromise the integrity of the statewide track-and-trace system • Do something that results in serious bodily injury to anyone at Embarc’s facility or something that otherwise creates a material risk to public health and safety Embarc employees are trained on the following standard operating procedures which provide clear, easy-to-im- plement steps to manage visitors: 57 • When a visitor is seeking access to the limited-access areas of Embarc’s retail facility, ask for their government-issued ID. If they cannot produce a valid ID or are under the age of 21, turn them away. Note: Refer to the policy section for acceptable forms of identification. • Do not accept anything (goods, services, or money) in exchange for permitting a visitor to enter a limited-access area. • Ask the visitor to sign into the Visitor Access Log. His or her entry must include a signature, and you must sign as the employee escorting the visitor. • When they are done filling out their entry in the Visitor Access Log, ensure their ID matches the name on the Visitor Access Log. • When they are done filling out their entry in the Visitor Access Log, give the visitor a visitor identifica- tion badge and ask them to keep it visible to others at all times while they’re at the facility. Failure to do so will result in immediate removal from the premises. • Instruct the visitor that they must sign out on the Visitor Access Log prior to leaving the facility. • Escort and monitor the visitor when in the limited-access area(s) of the retail facility. • Remind the visitor(s) that touching cannabis goods and on-site consumption of cannabis goods is strictly prohibited. • After the visit is completed, instruct the visitor to sign out on the Visitor Access Log. Ensure they record the accurate departure time. • Verify that the full name of the employee escorting the visitor throughout the facility is documented in the Visitor Access Log, along with their badge number. • Ask the visitor to return their visitor identification badge. • Once you check out the visitor, ensure they immediately leave the premises. Note: If a visitor refuses to vacate leave the premises, it should be considered an incident and handled in accordance with Embarc’s incident response procedures. Marketing and Advertisement Placement Compliance The City of Fresno has developed signage and advertising regulations far more stringent than those promul- gated by the state, and Embarc will implement and ensure compliance with all requirements, including but not necessarily limited to, the following: 1. All business identification signage will confirm to the requirements of Chapter 15, Article 26 of Fresno Municipal Code 2. No signs placed on the premises will obstruct any entrance or exit to the building or any window 3. Business identification signage will be limited to that needed for identification only and will not contain any logos or information that identifies, advertises, or lists the services or the products offered 4. Advertising will not be visible from the exterior of the establishment and will not be placed on the exterior of the premises 5. We will not utilize a person holding a sign advertising the business to passerby, whether on our premises or not 6. Signage will not be directly illuminated 7. No banners, flags, billboards or other prohibited signs will be used at any time 8. No billboards of any kind will be used in the City of Fresno —whether to advertise Embarc Fresno or any Embarc location When engaging in the advertising and marketing of Embarc, Embarc will confirm that no advertising efforts: 1. Contain any statement that is inconsistent with statements on the labeling 2. Create a misleading impression, either directly or by omission 3. Attract children 4. Encourage those under the age of 21 years old to consume cannabis or cannabis products 58 5. Create the impression that the cannabis originated in a specific place of origin unless the label of the advertised product bears the name of the place or origin Per CA BPC 26155(a), and as listed to meet local requirements above, Embarc will verify that advertisements and signage inside Embarc’s licensed premises are not visible by normal, unaided vision from a public right-of-way. Per CA BPC 26154, Embarc will not include any untrue health-related statements or statements that create a misleading impression regarding the effects cannabis consumption has on health on the label of any cannabis or cannabis product. Embarc acknowledges that any health-related statement must be supported by the totality of publicly available scientific evidence (including evidence from well-designed studies conducted in a manner which is consistent with generally recognized scientific procedures and principles), and for which there is signifi- cant scientific agreement among experts qualified by scientific training and experience to evaluate such claims. Furthermore, per CA BPC 26154, Embarc will not publish or circulate advertising or marketing that contains untrue health-related statements or statements that create a misleading impression regarding the effects on health of cannabis consumption. Embarc will not advertise free cannabis goods or giveaways of any type of products, including non-cannabis products. Per CA BPC 26151(a)(1)-(3), Embarc will include its name and license number on all advertisements and marketing, including internet advertisements. Per CA BPC 26152(h), Embarc will not engage in advertising or marketing if its license has been suspended. Marketing and Advertisement Placement Procedures Prior to formally publishing or airing any advertising or marketing, Embarc’s Director of Compliance will confir m that the advertisement is compliant with state laws and local ordinances. This confirmation will be provided on Embarc’s internal “Advertising Compliance Approval Checklist” and a copy of this document will be maintained electronically and onsite the retail premises. Embarc’s best practices for this include obtaining letter(s) or other documentation proving accurate audience composition data from all individuals or organizations that advertise Embarc asserting that 71.6% of the audience of the advertising is 21 years of age or older. These letters will be maintained such that they can be provided to the Bureau upon request. If the Bureau determines that audience composition data for advertising or marketing provided does not comply with the Bureau’s advertising requirements, Embarc will immediately cease such advertisement. To obtain approval for branded merchandise outside the Bureau’s definition of “branded merchandise”, Embarc will submit a written request to the Bureau for approval to sell the specific item of branded merchandise. Prior to submitting this to the Bureau, the brand and marketing department will fill out Embarc’s internal “Branded Material BCC Request Authorization Form” and provide to the Director of Compliance for Review. This form must include Embarc’s: • Entity name and license number • Description of each branded merchandise item to be approved for sale • Picture of each branded merchandise item to be approved for sale Embarc’s brand and marketing team may not submit a request to the Bureau until the Director of Compliance 59 authorizes such by signing the provided internal request form. Once approved, the Brand and Partnerships Manager must: • Email the above information to BCC@dca.ca.gov • Provide a photograph (mockup) of the branded merchandise in the email to the Bureau • The Brand and Marketing team may not move the item into production, nor may the item be distributed to an Embarc store and sold, until receipt of written approval from the Bureau. • Once approved, the written approval must be submitted with the purchase order and a copy must be maintained electronically in our files. Prior to any advertising or marketing involving direct, individualized communication or dialogue, Embarc must use age affirmation to verify that the recipient is 21 years of age or older. Note: For the purposes of this SOP, and per CCR 16-42-1 5041(a) (2019) CCR 16-42-1 5041(b), direct, individualized communication or dialogue may occur through any form of communication, including in-person, telephone, physical mail, or electronic. Embarc must use a method of age affirmation before having a potential customer added to a mailing list, subscribe, or otherwise consent to receiving direct, individualized communication or dialogue controlled by Embarc. Note: Per state regulations, a method of age verification is not necessary for a communication if the licensee can verify that the licensee has previously had the intended recipient undergo a method of age affirmation and the licensee is reasonably certain that the communication will only be received by the intended recipient. Marking Cannabis Goods as Alcoholic Products Embarc will not sell or transport cannabis goods that are labeled as beer, wine, liquor, spirits, or any other term that may create a misleading impression that the product is an alcoholic beverage. Display of Cannabis Goods Cannabis goods for inspection and sale will only be displayed in the retail area. Cannabis goods may be removed from their packaging and placed in containers to allow for customer inspection. The containers will not be readily accessible to customers without assistance of a Guide. A container must be provided to the customer by the Guide, who will remain with the customer at all times while the container is being inspected by the customer. Cannabis goods removed from their packaging for display will not be sold, will not be con- sumed, and will be destroyed pursuant to all applicable Bureau regulations. Cannabis Goods for Sale Embarc will not make any cannabis goods available for sale or delivery unless: • The goods were received from a licensed distributor or licensed microbusiness authorized to engage in distribution; • Embarc has verified that the cannabis goods have not exceeded their best-by, sell-by, or expiration date if one is provided; • The cannabis goods have undergone laboratory testing as required by the Bureau; • The batch number of the cannabis or cannabis product is labeled on the package of cannabis goods and matches the batch number on the corresponding Certificate of Analysis for regulatory compliance testing; • The packaging and labeling of the cannabis goods complies with Business and Professions Code Section 26120 and all applicable regulations as well as California Code of Regulations, Title 3, Division 8 and Title 17, Division 1, Chapter 13; and • The cannabis goods comply with all applicable requirements found in state laws and applicable regulations. 60 Prohibition on Packaging and Labeling by a Retailer Embarc will not accept, possess, or sell cannabis goods that are not packaged. As allowable by law, this prohibi- tion does not apply to the application of a barcode label tied to Embarc’s point of sale system for the purposes of scanning product during checkout to streamline the process. Cannabis Goods Packaging and Exit Packaging Exceeding state and local standards, all cannabis goods purchased by a customer will be placed in an opaque, resealable child-proof exit package prior to being handed to the customer. Additionally, for patients and consumers seeking an additional layer of security, Embarc will also have secure storage devices available for purchase. Upon completion of a sale of cannabis or cannabis products to a patient, caregiver, or adult consumer, the Embarc Guide will: • Verify the tamper-evident seal on the package of the cannabis or cannabis product is still intact before placing the cannabis or cannabis products purchased by a patient, caregiver, or adult-consumer in a Bureau-approved exit package. • Seal the exit package and affix the corresponding receipt to the package. • Instruct the patron that the exit package may not be opened on the licensed premises. • Release the exit package into the patron’s physical control, ensuring as little physical contact with the patron as possible to eliminate chances of contamination during COVID-19. The exit package will: • Be designed or constructed to be significantly difficult for children under five years of age to open and not difficult for adults to use properly, as defined by 16 C.F.R. 1700.20 • Be opaque so that the cannabis goods cannot be seen from outside the packaging • Have the ability to be resealable • Be labeled in accordance with Bureau instruction and all other applicable state and local laws, regula- tions, ordinances, and other requirements Embarc will similarly follow these policies and procedures when conducting deliveries, as detailed further in Section 1.6.1 (vi). Sale of Non-Cannabis Goods In addition to compliant cannabis goods, Embarc will sell only approved cannabis accessories and Embarc branded merchandise. Per the Bureau, “branded” is defined as clothing, hats, pencils, pens, keychains, mugs, water bottles, beverage glasses, notepads, lanyards, cannabis accessories, or other types of merchandise approved by the Bureau with the name or logo of a commercial cannabis business licensed pursuant to the Act. Branded merchandise does not include items containing cannabis or any items that are considered food as defined by Health and Safety Code section 109935. Embarc will obtain approval from the Bureau for any goods deviating from this approved list prior to sale. Free Cannabis Goods Embarc will not provide free cannabis goods with the exception of providing compassionate access to qualified medicinal cannabis patients (or their primary caregiver) in possession of an identification card who have diffi- culty accessing medicinal cannabis goods. 61 Donated items will only be provided to medicinal cannabis patients, or primary caregivers, with a valid recom- mendation or medical marijuana identification card under Section 11362.7 of the Health and Safety Code. Daily Limits Embarc will not sell more than the following amounts to a single adult use cannabis customer in a single day: • One ounce (28.5 grams) of non-concentrated cannabis • Eight grams of concentrated cannabis, included concentrated cannabis contained in cannabis products • Six immature cannabis plants Medical cannabis patients are limited to a maximum purchase of eight ounces of medicinal cannabis in a single day and 12 immature cannabis plants. If a medicinal cannabis consumer provides a valid physician’s recommendation containing an amount greater than eight ounces, the consumer may purchase an amount of medicinal cannabis consistent with the recommendation. The aforementioned limits will not be combined to allow a customer to purchase cannabis goods in excess of any of the limits. By law, Embarc will only sell live, immature cannabis plants and cannabis seeds if all of the following require- ments are met: • The plant is not flowering • The plant or seed originated from a nursery that holds a valid license from the Department of Food and Agriculture or a licensed microbusiness authorized to engage in cultivation • A label is affixed to the plant or package containing any seeds which states “This product has not been tested pursuant to the Medicinal and Adult-Use Cannabis Regulation and Safety Act” Embarc will not sell any other live plants and will not apply nor use any pesticide, nor cause any pesticide to be applied nor used, on live plants in the dispensary’s possession. Customer Return of Cannabis Goods Per state law, Embarc is permitted to accept customer returns of cannabis goods, so long as those goods were purchased from Embarc’s retail facility. Cannabis goods abandoned at the licensed premises will also be treated as a return. Under no circumstances will Embarc ever resell cannabis goods that have been returned. Returned cannabis goods, including those abandoned on-site, must be segregated, destroyed, and rendered into cannabis waste. All returns will be investigated to ascertain the reason for the return and the customer’s account will be notated in the point of sale system and in our internal returns log. All returns must be processed by or under the super- vision of a manager. Information gathered and entered into CCTT-Metrc will include, but is not limited to: • Name and type of the cannabis goods • UID of the cannabis goods • Amount of the cannabis goods, by weight or count • Date and time of the transaction • Name and license number of Embarc and other licensees involved in the transaction • The reason for the return • Any other information required to be documented by the Bureau 62 Store credit in exchange for returned cannabis goods will be offered on a case by case basis at the discretion and approval of an Embarc Store Manager. Embarc will ensure that all retail employees are trained on Treez, Embarc’s chosen internal seed-to-sale tracking system, including how to process a return, and the service level they are expected to meet during the experience. Embarc will also train its retail employees on criteria to be used when evaluating whether or not to accept a return, such as the return window, whether the customer has made numerous returns in the past, and the quality of the item(s) to be returned. In the event that a customer is returning cannabis goods due to a product recall, the procedures outlined in Embarc’s internal Product Recalls SOP will be followed. Inventory Management Track and Trace System Embarc will utilize an inventory management and point of sale (POS) system called Treez to monitor and report on all inventory, purchases and denials of sales, and to establish an account with the CCTT-Metrc track and trace system to make all required and compliant reporting to the Bureau. Treez has designed their software suite of operations, inventory, and Enterprise Resource Planning management systems to be compliant with all required cannabis compliance and regulations procedures within the State of California, specifically within the content of Title 16 of the California Code of Regulations. Treez is designed to automatically interface with the required state track and trace system through CCTT- Metrc, once the accounts and systems are linked via API technology. The designated track and track account manager will be responsible for ensuring that the Treez system conducts all required reporting to the Bureau. Track and Trace Compliance Embarc will create and maintain an active and functional account within the CCTT-Metrc system prior to engaging in any commercial cannabis activity, including the purchase, sale, test, packaging, transfer, transport, return, destruction, or disposal, of any cannabis goods. Embarc will designate one individual owner as the track and trace system account manager. The account manager may authorize additional owners or employees as track and trace system users and will ensure that each user is trained on the track and trace system prior to its access or use. The account manager will attend and successfully complete all required track and trace system training, includ- ing any orientation and continuing education. If the account manager did not complete the required track and trace system training prior to receiving their annual license, the account manager will sign up for and complete state mandated training, as prescribed by the Bureau, within five calendar days of license issuance. The account manager and each user will be assigned a unique log-on, consisting of a username and password. The account manager or each user accessing the track and trace system will only do so under his or her assigned log-on and will not use or access a log-on of any other individual. No account manager or user will share or transfer his or her log-on, username, or password, to be used by any other individual for any reason. The account manager will maintain a complete, accurate, and up-to-date list of all track and trace system users, consisting of their full names and usernames. The retail store will monitor all compliance notifications from the track and trace system, and timely resolve the issues detailed in the compliance notification. 63 Embarc will keep a record, independent of the track and trace system, of all compliance notifications received from the track and trace system, and how and when compliance was achieved. If Embarc is unable to resolve a compliance notification within three business days of receiving the notification, the store will notify the Bureau immediately, by submitting the Notification and Request Form, BCC-LIC-027. Embarc is accountable for all actions its owners or employees take while logged into or using the track and trace system, or otherwise while conducting track and trace activities. Track and Trace Reporting All transactions relating to inventory are performed and tracked by Treez. Inventory tracking of sales is stretched across multiple authorized users with dedicated tasks in different areas of the facility, ensuring that inventory management is the result of multiple redundancies and data triangulation. Embarc will record in the track and trace system all commercial cannabis activity, including: 1. Packaging of cannabis goods. 2. Sale and transfer of cannabis goods. 3. Transportation of cannabis goods to a licensee. 4. Receipt of cannabis goods. 5. Return of cannabis goods. 6. Destruction and disposal of cannabis goods. 7. Laboratory testing and results. 8. Any other activity as required pursuant to state and local regulations, or by any other licensing authority Embarc will record the following information for each activity entered in the track and trace system: 1. Name and type of the cannabis goods. 2. Unique identifier of the cannabis goods. 3. Amount of the cannabis goods, by weight or count, and total wholesale cost of the cannabis goods, as applicable. 4. Date and time of the activity or transaction. 5. Name and license number of other licensees involved in the activity or transaction. 6. If the cannabis goods are being transported. If there are any discrepancies between the type or quantity of cannabis goods specified in the shipping manifest and the type or quantity received by the licensee, Embarc will record and document the discrepancy in the track and trace system and in any relevant business record. If cannabis goods are being destroyed or disposed of, the retail store will record in the track and trace system the following additional information: 1. The name of the employee performing the destruction or disposal. 2. The reason for destruction and disposal. 3. The entity disposing of the cannabis waste. Description for any adjustments made in the track and trace system, including, but not limited to: 1. Spoilage or fouling of the cannabis goods. 2. Any event resulting in damage, exposure, or compromise of the cannabis goods. 64 All transactions must be entered into the track and trace system within 24 hours of occurrence. Embarc will only enter and record complete and accurate information into the track and trace system and will correct any known errors entered into the track and trace system immediately upon discovery. Loss of Connectivity If at any point Embarc loses connectivity to the track and trace system for any reason, the retail store will prepare and maintain comprehensive records detailing all commercial cannabis activities that were conducted during the loss of connectivity. Embarc will notify the Bureau immediately for any loss of connectivity, and will not transport, receive, or deliver any cannabis goods until such time as connectivity is restored. Licensees will submit such notices on the Notification and Request Form, BCC- LIC-027. Once connectivity has been restored, Embarc will: 1. Within three calendar days, enter all commercial cannabis activity that occurred during the loss of connectivity into the track and trace system. 2. Document the cause for loss of connectivity, and the date and time for when connectivity to the track and trace system was lost and when it was restored. Track and Trace System Reconciliation In addition to other inventory reconciliation requirements, the retail store will reconcile the physical inventory of cannabis goods at the licensed premises with the records in the track and trace database at least once every 30 calendar days. Per Embarc internal policies, full reconciliations must occur no less frequently than once every two weeks, with a rolling inventory reconciliation occurring daily for the first 90 days of operations. If Embarc finds a discrepancy between its physical inventory and the track and trace system database, the store will conduct an audit and notify the Bureau of any reportable activity. Record Retention Embarc will keep all necessary books and records required to render a full account of all commercial cannabis operations conducted at Embarc’s retail facility for the year to date and the seven years prior. All dispensary records regarding operations, employees, transactions, products, and any other relevant activities will be stored in a compliant fashion that ensures against data loss for a minimum of seven years. The Bureau, and other licensing authorities, may inspect the licensed premises and examine any records related to commercial cannabis activity owned or created by Embarc, and upon request, will be granted full access to inspect all facility records as necessary to perform official government functions and duties. Required records maintained in CCTT-Metrc, Embarc’s internal inventory management and point-of-sale system Treez, and Embarc’s secure document storage system are all considered to be maintained on the premises, provided that any records exclusively maintained in electronic format can be produced in a legible, hard copy format upon request. All records that must be maintained in hard copy format on-site will be copied and stored electronically as well to ensure no records are lost in the event of a disaster and are protected from debris, moisture, contamination, hazardous waste, fire, and theft. Embarc’s compliance efforts will be demonstrated through its organizational efforts. And strict operational SOPs All hard copy records that are required to be maintained will be organized by subject. In addition, records will be organized by month and in chronological order. This will allow for ready and immediate access for any records by the licensing authority upon request. 65 Recordkeeping activities may be delegated as necessary. Embarc may elect to contract with a third party for record custodial or management services. All persons with recordkeeping responsibilities must be informed that a contract with such a service does not relieve Embarc of the recordkeeping responsibilities described here and in applicable state and local laws and regulations. Embarc will keep and maintain the following records related to commercial cannabis activity for at least seven years: 1. Financial records including, but not limited to, bank statements, sales invoices, receipts, tax records, and all records required by the California Department of Tax and Fee Administration (formerly Board of Equalization) under title 18, California Code of Regulations, sections 1698 and 4901. 2. Personnel records, including each employee’s full name, social security or individual taxpayer identifi- cation number, date employment begins, and date of termination of employment if applicable. 3. Training records including, but not limited to, the content of the training provided and the names of the employees that received the training. 4. Contracts with other licensees regarding commercial cannabis activity. 5. Permits, licenses, and other local authorizations to conduct Embarc’s commercial cannabis activity. 6. Security records, except for surveillance recordings required pursuant to state guidelines. 7. Records relating to the composting or destruction of cannabis goods. 8. Documentation for data or information entered into the track and trace system. 9. All other documents prepared or executed by an owner or their employees or assignees in connection with the licensed commercial cannabis business. All records are subject to review by the City of Fresno, the Bureau, as well as other governmental agencies any time Embarc is exercising the privileges of the license or at any other time as mutually agreed to by the Bureau and the retail store. Prior notice by the Bureau BCC to review records is not necessary. The Bureau may review records outside of Embarc’s standard daily business hours. Inventory Control Embarc has developed strict SOPs for the management and monitoring of all inventory. These procedures are predicated on strict accountability to a single individual at every stage of the chain of command and on double redundancy for all inventory work. We will digitally and physically log, verify, and monitor the receipt, storage, dispensing, recall, destruction, and disposal of cannabis products using our inventory management SOPs, our inventory management and POS system, and strict procedural controls. Embarc employs the following best practices for inventory control and security management: • Only authorized management has access to the Product Storage Room. • A specific role in the business operation (Inventory Specialist) handles the product movements from the product storage room to the retail and delivery components of the business. This design strategy maximizes accountability, reduces exposure, reduces movements and opportunities for diversion, while also maintaining the specific design and security features of the product storage room secret from front line employees, vendors, visitors and customers. • Retail area employees will receive stock through a secure pass through connecting the retail and product storage rooms, eliminating the need for retail room employees to have any access to the product storage room. • Delivery drivers will receive orders in a driver lobby and have no access to the product storage room. • Third party (distributors) vendors are provided no access beyond the secure, indoor loading area, maintaining the location and intelligence surrounding product storage in secrecy. 66 Receiving Shipments of Inventory To avoid redundancy, please see Section 1.6.1 (ii). Storage and Management of Inventory All inventory stored on the licensed premises shall be secured in a limited-access area. Embarc shall not store cannabis goods outdoors. Employee break rooms, changing facilities, and bathrooms shall be separated from all storage areas. Each location where cannabis goods are stored must be separately licensed. • Embarc will keep an accurate record of its inventory and use the Bureau’s chosen statewide inventory tracking system, CCTT-Metrc, to ensure its inventories are identified and tracked throughout the supply chain or otherwise disposed of. Furthermore, to ensure compliant and efficient inventory control, Embarc will use Treez, its internal seed-to-sale tracking software in addition to CCTT-Metrc. This system will meet and accomplish the following, at minimum, in regard to retail operations, inventory tracking, and inventory management: • The ability to connect with CCTT-Metrc through an API •Tracking products from the moment they are acquired to the moment they are sold or disposed of •Documenting the form and types of cannabis goods maintained at the store on a daily basis • Tracking inventory so that the oldest stock is sold first •The ability to print comprehensive medicine labels •Integrating and updating Embarc inventory logs, checklists, and SOPs •The ability to provide for employee restricted inventory adjustment screens and printable reports • Maintaining the confidentiality of all patient data and records Embarc will have the ability to reconcile all on-premises and in-transit inventory records in CCTT-Metrc and Embarc’s internal inventory management and point of sale system. Embarc’s Retail Manager, under the super- vision of the Inventory Compliance Manager, is responsible for completely and accurately entering all inventory data and accounting for all inventory tracking and management activities, including physical movement or destruction of cannabis goods, conducted at the facility. • Misstatements and omissions when entering data into CCTT-Metrc are strictly prohibited. In the case that data is accidentally misstated or omitted, the Inventory Compliance Manager is responsible for correcting the errors and documenting all corrections. • Any misstatements or omissions may be considered a license violation affecting public safety and will be taken very seriously. • Embarc’s tracking of inventory items will encompass all phases of the chain of custody, including: • The transfer of custody from another licensee to Embarc • Storing the cannabis goods on premises and moving the product as needed • Selling cannabis goods to adult consumers, patients and caregivers • Shipping manifests will be used to track inventory for all incoming and outgoing shipments Inventory Tracking Procedures Embarc employees utilize the following standard operating procedures regarding required inventory tracking: Transferring the chain of custody when an incoming shipment has been verified: • Immediately after completing the Acquiring Wholesale Cannabis Product SOP and once shipment has been physically verified and accepted in CCTT-Metrc, input all items into CCTT-Metrc. • If acquiring regulated marijuana from a third-party vendor: • Access the shipping manifest in CCTT-Metrc. • Follow the following CCTT-Mertc pathway: Transfers>>Incoming>>Find shipping manifest using the corresponding manifest number 67 • Hit “Accept” to receive the cannabis goods electronically into Embarc’s inventory. Note: This will transfer custody of cannabis goods from the selling licensee to Embarc • If acquiring cannabis goods from a vertically integrated cultivator or manufacturer, create a new package in CCTTMetrc for each cannabis strain or cannabis product type. • Enter the date and time the item was received at the facility. Enter the sell by or expiration date. When there isn’t one, leave this category blank • Enter a description of each item such that the cannabis goods can easily be identified • Enter the name, address, and license number of the licensee that delivered the shipment of cannabis goods • Enter the unique product or plant identification number used by the cultivator or manufacturer that delivered the item in order to maintain the chain of custody • Enter the price Embarc paid for the cannabis goods into CCTT-Metrc, including taxes, delivery costs, or any other costs Once cannabis goods are in the custody of Embarc: • Enter received cannabis goods into Embarc’s internal seed-to-sale tracking system and CCTT-Metrc, as needed, for the purposes of creating analytical inventory reports. Enter the following information to ensure accurate daily tracking of inventory for each type of cannabis good: • Product name or cannabis strain name • Unique identifier • Batch or lot number • Number of units of each type of cannabis good • Weight of each type of cannabis strain in ounces or grams • Vendor information • Wholesale unit cost • Sales price • Date and time of activity • Confirm that all store employees are: • Accurately recording the movement of all cannabis goods in the store in Treez, Embarc’s chosen seed-to-sale tracking system • Following the FIFO (first in, first out) method when stocking and distributing cannabis goods Final phase in the chain of custody —sale or disposal • Keep a record of all sales of cannabis goods which identifies: • All amounts of cannabis goods involved in the sale • All types of cannabis goods involved in the sale • Itemizations • Taxes collected • Grand total sales amounts • Track all returns of cannabis goods from consumers, patients, and caregivers from point of acceptance to disposal. • Follow the sales transaction policy and tasks outlined in Embarc’s Performing and Recording a Sales Transaction SOP. • Follow the waste recording tasks outlined in Embarc’s Rendering Cannabis Waste SOP. Inventory Documentation As noted in “Record Retention,” Embarc will maintain an accurate record of its inventory. Embarc will provide the Bureau and local regulators with the record of inventory immediately upon request. 68 The retail store will keep a record of the following information for all cannabis goods the licensed retailer has in its inventory: 1. A description of each item such that the cannabis goods can easily be identified; 2. An accurate measurement of the quantity of the item; 3. The date and time the cannabis goods were received by the retail store; 4. The sell-by or expiration date provided on the package of cannabis goods, if any; 5. The name and license number of the licensed distributor or licensed microbusiness that transported the cannabis goods to the retail store; and 6. The price the retail store paid for the cannabis goods, including taxes, delivery costs, and any other costs. Inventory Reconciliation Embarc will be able to account for all of its inventory. In conducting an inventory reconciliation, Embarc will verify that the physical inventory is consistent with the records pertaining to inventory. The result of inventory reconciliation will be retained in the retail store’s records and shall be made available to the Bureau and local law enforcement upon request. If the retail store identifies any evidence of theft, diversion, or loss, Embarc will notify the Bureau and local law enforcement. If a significant discrepancy is discovered between the retail store’s physical inventory and Embarc’s inventory records, Embarc shall notify the BCC and local law enforcement. The determination on whether a discrepancy in inventory is significant will be made in accordance with the following: 1. A significant discrepancy in inventory means a difference in actual inventory compared to records pertaining to inventory of at least 3 percent of the dispensary’s average monthly sales. Average monthly sales will be calculated by taking a per month average of the total sales for the previous 6 months. If the retail store has not been in operation for at least 6 months, only the months in which Embarc was operating will be used in determining average monthly sales. 2. The acquisition price will be used to determine the value of cannabis goods in Embarc’s inventory. Retailer Premises to Retailer Premises Transfer Embarc may arrange for the transfer of cannabis goods from one licensed retail premises to another licensed retail premises if both retail licenses are held under the same ownership. Any movement of cannabis goods will be properly entered into the state track and trace system. Product Storage and Recalls Embarc’s strict inventory management procedures and implementation of software to track products will allows our licensed dispensaries to have a complete understanding of when a product was manufactured, when it arrived at the premises and how long it has been in stock. Refrigerators will be installed for products that require temperature control. All other shelf-stable products will be stored at a constant temperature in the limited-access storage area to prevent deterioration. While these measures are important to ensure the freshness and quality of a product, they are critical in the event of a product recall. Upon the issuance of a recall, Embarc will be able to immediately identify all affected inventory through METRC and Treez in real time, allowing Embarc to place an immediate stop to the sale of potentially contaminated product and to conduct a thorough inventory review to ensure all recalled product is accounted for and properly addressed. Inventory and Records Consistent with Article 3 § 5033 of the Bureau regulations, all inventory stored on the licensed premises will 69 be secured in a limited-access area. The limited-access storage area will be controlled by biometric access and only employees with the appropriate security clearance will be allowed access. Additionally, the singular entry point to the storage area will have a dedicated security camera at its entrance and a dedicated security camera within the storage room. This location is detailed in our security plan. Record Storage As previously discussed, Embarc will use Treez point of sale software to manage and store transaction information including records, reports, manifests, and any other documents generated by the business. Treez is an integrated software platform that automatically enforces best practices with a focus on compliance and loss prevention. The system utilizes an Application Programming Interface (API) to facilitate a direct online connection to METRC, the State’s Track and Trace platform. Per state requirements, this data, including transaction informa- tion, patient records, reports, manifests and any other documents, are stored both physically and electronically in the cloud for a period of at least seven years. Average or Expected Amount of Cannabis Storage We understand the importance of accurate ordering and inventory management to meet demand from patients and consumers while ensuring there are not unnecessarily large quantities of product stored on site. To achieve this goal, we have executed an agreement with our primary distributor to conduct deliveries no fewer than one time per week from their regional distribution center. This reduces the quantity of product stored on-site to less than one week’s worth of product, a net benefit to public health and safety, while also ensuring sufficient supply to meet demand. It also helps to ensure we are selling the freshest products available. Per state regulations, these products will be logged into our inventory management system and stored in our highly secure limited access area. Furthermore, we will have no live product on the floor, eliminating the risk of diversion. Through our partnership with Herbl, we will utilize artificial intelligence technology to implement predictive ordering specific to the Fresno store, which develops our prospective orders for each of our locations based on what patients and customers are actually purchasing in that location. This reduces the quantity of product stored on site by limiting SKUs to exclude extraneous products and ensures consistency in our supply chain to maintain sufficient inventory of products in high demand. Currency Security Strict controls will be applied to cash handling procedures. A manager will be responsible for proper account- ing, transacting, and handling of currency. Currency stored on the premises will be stored in a burglary resis- tant safe that meets the recommended standards of Underwriters’ Laboratory (UL) for the amount of currency stored. In the event that the average currency storage exceeds the standard for the safe installed, additional safes or a replacement safe commensurate to the UL recommendations for the new stored amount will be installed. Any safe used for currency storage on the premises will weigh at least 800 pounds, maintain a fire resistance rating of at least one hour, be made of metal and be anchored to the permanent structure of the building. As currency requires movement to an offsite storage facility, currency transportation will be managed by way of armed, uniformed escort, whether in the form of a private patrol operator licensed by the Department of Consumer Affairs or by an armored carrier licensed by the California Highway Patrol. 70 Staff is trained on the following cash handling policies and procedures: • Cash will be kept out of view of general staff and public; •The counting of cash will be limited to designated, management office of the premises; •All currency counting and storage areas will be under overt video surveillance; and •Management will ensure that all currency is placed in the safe as soon as possible. Transparency with the City Given the historical prohibition on cannabis, barriers have traditionally existed prohibiting meaningful collab- oration between cannabis operators and local municipalities and law enforcement agencies. However, with the transition into the legal, regulated market comes the opportunity for cannabis operators to work collaboratively with jurisdictions to ensure safe, compliant, and transparent cannabis operations. Our leadership includes team members that have worked within and for state and local government, which informs our understanding of how to best collaborate with local and state government and our desire to serve as a partner to the City of Fresno in the implementation and ongoing management of a responsible cannabis business the City can be proud to have in its jurisdiction. Examples of this ongoing engagement include, but are not limited to: • Providing designated points of contact and immediate responsiveness Embarc’s General Manager will be available 7 days a week between 8 am and 10 pm. If an issue arises after hours, Embarc’s Head of Security will be immediately accessible. Furthermore, while the City requires notification of any notice of violation or other corrective action within three (3) days, Embarc will commit to providing notice within 24 hours to ensure the City is kept informed in real time. • Providing virtual private network (VPN) access to the Police Department To further illustrate our desire for transparency in operations with the City and Police Department, we will provide total access to our VPN to the Police Department via a secure connection. This allows the Department visibility into store security footage at all times. •Soliciting ongoing feedback into community operations and community benefits As detailed later in this proposal, Embarc has established a Community Advisory Board that will meet regularly to inform operations and determine funding priorities for Embarc’s Community Investment Fund. We intend to include a participant from City government and public safety but thought it inap- propriate to conduct outreach to such representatives prior to receiving a dispensary permit. This will allow for ongoing positive communication and collaboration with the City. Mitigating Adverse Impacts on Community Impact mitigation and the prioritization of public health and safety are important components of being a good neighbor. As part of the use permit and licensing process, Embarc will voluntarily request that part of our conditions of approval include a good neighbor policy that will address many potential community concerns and will be distributed to our neighbors so they have a full appreciation of how seriously we value our integra- tion in the community. Please see Section 3 for more information. Employee Training Overview Our team believes that employees must be positioned to succeed through thorough onboarding, ongoing training and education, and effective leadership at every level of the organization providing clear direction and guidance. Furthermore, it is critical that clear performance expectations are set and a pathway for upward mobility is created to inspire and motivate team members. 71 Embarc’s employee training program slowly and deliberately guides our employees from a base of no presumed knowledge to mastery of every dispensary position, and when appropriate, to mastery of managerial positions as well. Our training program will ensure that all employees understand the rules and laws to be followed by our retail team, have knowledge of security measures and operating procedures, and be able to advise customers on how to select and safely consume cannabis products. The foundation of all training will be the policies and procedures of our SOPs. Additionally, our Employee Handbook will provide team members with detailed information regarding dispensary operations including but not limited to security, storage, inventory management, and distribution of cannabis. General Managers receive four weeks of training, Managers receive three weeks of training, and all other employees receive two weeks of extensive training prior to opening the store. This training focuses on com- pliance, security, operational procedures, cannabis knowledge and product-specific expertise. Below is a short summary of the training process. We will gladly provide a more detailed overview if desired. Embarc’s training curriculum is designed to accommodate the variety of learning modalities. Training materi- als will be presented in a range of mediums, and employees will be asked to demonstrate mastery interactively and in written form. Written material will be supplemented by verbal presentations and graphical slides. Small- group discussions of material and question-and-answer sessions will follow to address any outstanding ques- tions or gaps in understanding. Role-playing material and simulations of emergency situations will be utilized to ensure all employees are sufficiently prepared for any circumstances that may be faced in their position. As frontline employees with direct customer interaction, it is imperative that our Guides receive superior product education and customer service training. Prior to any store opening, every Guide undergoes a rigorous two-week training. This training includes, but is not limited to, thoroughly understanding the following: • Dispensing rules and regulations as promulgated by the city and state. • Excellent customer service skills. • Cannabis efficacy and the latest in efficacy research. • Cannabis product information and selection assistance, including strain differences, terpene profiles, dosages, and consumption methods. • Substance abuse prevention and recognizing signs of impairment. • HIPAA, ADA, EEOC, and other federal, state, and local laws, regulations, ordinances and requirements related to the cannabis industry and cannabis consumption. After completing the two-week initial training, Guides will be required to complete various weekly, quarterly, and annual trainings. These training sessions are developed by our highly experienced Vice President of Retail, Chief Operations Officer, and Chief Compliance Officer. In addition to our ongoing in-house training, within six weeks of hire, all Guides will be required to complete the Cannabis Care Certification program developed by the nationally recognized Americans for Safe Access Foundation (the “ASA”). The mission of ASA is to ensure safe and legal access to cannabis for therapeutic use and research. The ASA Cannabis Care Certification program is designed to help individuals better understand the endocannabinoid system and cannabis therapeutics. By completing this program our Guides will have unparalleled knowledge into the interplay between cannabis consumption and the human body— knowledge that will play a pivotal role in educating our customers. Finally, we leverage the educational tools and resources developed by the brands and cultivators themselves to provide detailed, product-specific information for every product on our shelves. These resources are available to the team 24/7 via Embarc’s internal online classroom that houses all of our cannabis and brand education resources. Employees can access brand decks, education articles and quizzes on their own time, as well as 72 when they are assigned directly to them as part of our mandatory ongoing product, operations and compliance education program. Below is a breakdown of the Embarc training schedule that our Guides receive upon hire. This training is designed to ensure all staff have a deep understanding of cannabis, health and wellness, and our company values and operations in order to comfortably and capably assist guests. This training also includes a significant focus on cannabis compliance with all state and local laws and regulations to ensure public health and safety. After employees are hired and paperwork is complete, they undergo a two-week training consisting of three distinct tiers: Living Our Values (Three Days) First and foremost, all Embarc employees are welcomed to the organization through a multi-day training session focused on living our shared values. This includes a detailed exploration of Embarc’s mission, vision and goals, review and workshopping around our employee Code of Conduct, training from our Head of Community Affairs on neighborhood engagement, and our expectations of employee conduct inside the store and as a representative of Embarc within the community. We also expect all security guards assigned to the premises to participate in this training because they also serve as vital stakeholders in protecting public health, public safety, and as guardians of Embarc’s reputation onsite. This initial training is led by our Head of Community Affairs, Chief Executive Officer and security leadership, and details the Good Neighbor Policy regarding how to address loitering, littering, attempted youth access and more. • This training also includes role playing scenarios to ensure employees feel comfortable in their new role as stewards of the Embarc brand. • During this time, employees learn everything from how to scan an ID in the point-of-sale system and secondary ID reader to how to seamlessly coordinate with security to address a disruptive customer. • These skills are then reinforced through roleplaying throughout the remainder of the two-week training, with such examples as what to do if a customer starts trying to open a package and consume cannabis in the parking lot to how to address a customer playing music loudly in his or her car. Cannabis 101 (Two Days) Next, all Embarc employees must participate in our ‘Cannabis 101’ training program that integrates a research- based approach to provide broad overview of all things related to cannabis. Much like Living our Values, this training is also required of any contractors that have consistent interaction with Embarc guests, such as our security team. Among other issues, Cannabis 101 details the history of cannabis legalization in California; the laws and regu- lations that now allow for adult use cannabis; cannabis science basics with a focus on CBD, THC, and terpenes; and the state’s track-and-trace program. This training is critical to ensuring consistency in cannabis education. Importantly, because we also serve medical patients, it is essential that all employees have an science-based understanding of cannabis’ medicinal uses and the importance of serving as a resource in empowering consum- ers and patients to navigate their own cannabis journey. Compliance and Best Practices (Three Days) While compliance is interwoven into every module during the training program, we also have a detailed Compliance and Best Practices module focused on understanding every aspect of the store’s operations through the lens of compliance and best practices. During this training, Embarc employees are provided with an over- view of cannabis compliance, a detailed description of daily operations, including role playing scenarios with mock guest identification verification, sales, purchases, inventory and more. 73 Compliance and Best Practices also includes: • Compliance with all state and local laws governing every aspect of our operations • Consumer experience level, including tolerance, dosage, and our ‘start low, go slow’ • philosophy • Social equity in the cannabis industry • Standard operating procedures • Security • Problem solving and issue mitigation • Proper product handling • Daily operational flow, including use of the point-of-sale technology • Inventory reconciliation Protecting Public Health and Safety (Two Days) Finally, all Embarc employees undergo a rigorous training on the myriad security, operational and practical considerations critical to operating the day-to-day business activities. This training is conducted in partnership with all security guards assigned to work with Embarc such that employees are able to practice through role-playing scenarios and get comfortable working with security guards to manage any situation that may arise in real time. Ultimately, it is critical that we break down any perceived barriers between Embarc employees and contract security personnel and our experienced management team has found that undergoing training together is a vital component of achieving that cohesion. Shadow Shifts After the two-week training is complete, employees begin shadow shifts. In the case of a new store opening, these are part of the role-playing scenarios included throughout the training modules, which are led in partnership between store management for the soon-to-be-open store and with store managers from existing operations. If the shadow shifts are for a new hire in an operational store, the employee is paired with an experienced employee for three shadow shifts. These are intended allow the new employee to begin gaining work experience in our retail environment while maintaining consistency in the guest experience. During these shadow shifts, the new employees may encounter any number of novel situations that they will learn how to appropriately handle through ongoing coaching and mentorship. Finally, after finishing the two-week initial training course and shadowing at least three shifts, an employee will be authorized to begin independent shifts. After authorization, Embarc will provide employees with con- tinuing education opportunity and ongoing training. This may include weekly staff meetings where we bring in different team members to train on protocols, annual off-site visits to farms in the region to allow employees to experience the cultivation process, quarterly all-staff workshops and more. We understand that Guide education is an ongoing process. Further training is provided for certain roles, including our Lead Guides and Managers, as well as track-and-trace seminars for any employee managing our track and trace account. Additional training may include: • Fresno’s General Manager will receive in-store training at one of Embarc’s Bay Area locations prior to training the team and opening the store in Fresno. Real world experience operating under Embarc’s specific protocols and procedures is vital to successfully executing Embarc’s vision for this store, as well as the ability to effectively educate and train the store team. • Embarc managers from operating stores will attend and co-lead the new store orientation and training alongside the Fresno General Manager to provide best practices based on current Embarc trainings. 74 This breaks down barriers and facilitates information sharing among Embarc leadership across Northern California and provides resources during training to improve the operationalization of the store. • During operating hours there will always be at least one Lead Guide on the sales floor. Lead Guides are true cannabis experts with at least three years of cannabis operations experience and proven per- formance in our proprietary education program ensuring a true mastery of cannabis knowledge. This program includes both written and oral testing components as well as additional training. • The Lead Guide will be trained and capable of answering even the most obscure and challenging inquiries from customers with unique needs and complications. A typical example occurred recently in our Tahoe store, where one of our Lead Guides assisted a customer who wished to purchase cannabis flower but was allergic to a very specific terpene found only in certain strains of cannabis. Using the Certificate of Analysis testing results, our Lead Guide was able to identify which flower options did not contain the terpene in question, and therefore was safe for the customer’s consumption. • Guides continue to receive product education, compliance and operational training throughout their tenure. This training includes ongoing education from our vendors and partners, product knowledge quizzes, weekly terpene profile discussions and more. Continuous education is a component of our employee incentive plan and continuing to develop product and compliance knowledge is rewarded economically and with prizes. This keeps learning fun and motivated while ensuring our Embarc team continues to grow and evolve with the industry. Community Engagement Embarc is the first cannabis operator of its kind to implement a Community Advisory Board in each commu- nity where it operates wherein the Board has total control over where community investment is directed in perpetuity. Embarc assembles a Community Advisory Board to ensure the dispensary operates with the highest levels of integrity and with input from leaders in education, youth services, business, healthcare and public safety. For more information on Fresno’s Community Advisory Board, see Section 7. This is a proven model from Embarc’s existing operations. Embarc’s Community Advisory Board in South Lake Tahoe includes the Drug Free Coalition, Boys and Girls Club, Homeless Coalition, and other vital com- munity stakeholders. I was delighted when Christy was awarded one of the business licenses for the City, and was happy to accept her invitation to be on Embarc’s Tahoe Advisory Board. The Advisory Board comprises of local community organizations, including our Drug Free Coalition, and holds Embarc accountable to our community, while also advising them on how to distribute their business donations. Embarc is committed to philanthropy and in the short time they have been open, have already donated thousands of dollars to local non-profits. I feel strongly that businesses permitted to retail cannabis must conform to the highest standards of ethics and business practices, and be willing to work with and support local nonprofits and youth organizations. In Embarc you will find a business that exemplifies those standards, and provides meaningful support and engagement with the local community. Jude Wood, Executive Director, Boys and Girls Club of Lake Tahoe Proposed Schedule Embarc will aggressively pursue the following schedule to complete this project in a timely manner and begin operations in order to effectively meet the City of Fresno’s desired to find applicants who are prepared 75 to execute on their proposal rapidly and fastidiously. This schedule clearly provides a realistic timeline with milestones for: a. Application Processing b. Conditional Use Permit c. Issuance of State License d. Issuance of Building Permit and Other Regulatory Permits e. Completion of Construction f. Issuance of Operating Permit g. Opening and Commencement of Operations This schedule was developed by a team with experience operationalizing hundreds of cannabis licenses from concept to completion in a variety of jurisdictions across every component of the supply chain. Our team’s extensive experience navigating local and state regulatory and licensing requirements specific to these license types informs and strengthens our operational timeline. Phase I: December 2020 —August 2021 The first phase of the schedule includes time for City eligibility review, community benefits ranking and the issuance of permits. This timeline is informed by the City’s own timeline projections and is thus rooted in reality. During this phase, there is the potential for an appeal by failed applicants, which could potentially slow the process. However, this potential delay is accounted for in the proposed schedule. 1. Application Due: December 4, 2020 • Pursuant to the City of Fresno’s application guidelines for storefront cannabis retail, Embarc will submit its application no later than December 4, 2020. 2. Review of Written Application Materials: December 2020 —February 2021 • Pursuant to the City of Fresno’s proposed schedule, Embarc anticipates the review process to take approximately 75-90 days. JAN FEB MAR APR MAY JUNE JULYDEC AUG SEP OCT NOV 76 3. Tabulate Scores and Schedule Interviews: March 2021 • Pursuant to the City of Fresno’s proposed schedule, Embarc anticipates the ranking and scheduling process to take approximately 5 days. 4. Interviews: March 2021 —April 2021 • Pursuant to the City of Fresno’s proposed schedule, Embarc anticipates interviews to take place in March and April of 2021. 5. Award Announcement: April 2021 • Embarc anticipates that the license issuance City Manager will announce awards at the end of April 2021. 6.CUP/ Final Requirements / Appeals: May 2021 —August 2021 • The timeline must contemplate the possibility of an appeal pursuant to the terms of the application guidelines. An applicant may also file an appeal upon announcement of the final scoring. Further, per Council discussions and public statements, Embarc anticipates that the appeals process and the conclusion of the CUP process will begin in May 2021 and conclude in August 2021. Phase II: May 2021 —August 2021: This phase contemplates that Embarc is awarded a permit, at which point a CUP application will be filed along with all necessary applications to begin construction, entitlement and licensing. Additionally, given that design review and plan check can take between 30-60 days, Embarc intends to submit these plans within 60 days of being awarded a license to expedite the building permit process. Embarc’s Chief Operating Officer Terri Gilles will manage this process alongside Steve Hosey. Terri had decades of design and building experience spanning millions of square feet of construction. 1. Embarc will concurrently apply for a Conditional Use Permit and Public Benefit Agreement: May 2021 • Based on our team’s experience, including currently operating a non-cannabis business in the City of Fresno, and the staff presentation at Council, Embarc anticipates submitting a conditional use permit application in May 2021. Per the City’s recommendation, we anticipate the use permit process to take approximately 90 days which is why we have prioritized rapid submission. • Embarc will immediately begin working with the City Attorney and staff to turn the public benefit plan contained herein into a public benefit agreement or development agreement (or other desired format for legislative approval). We anticipate this process taking approximately 90 days but have had the drafting process take as little as one week in other communities. 2. Submit Building and Signage Plans for Design Review, Plan Check and Permits: June 2021 • Because Embarc understands how to mitigate delays, Embarc has already engaged a preeminent design studio and architecture firm to prepare complete, stamped architectural drawings including a site plan, floor plans, section drawings, building elevation drawings, and plumbing and mechanical plans immediately upon issuance of a CUP. This expertise across projects of all scales and sizes will be vital to safe, secure, and fast execution of our construction plans. This project will likely require design review given the exterior renovations being proposed. Upon notification to proceed, our contractor (in coordination with our architect) will apply for a demoli- tion permit while simultaneously submitting plans for plan check and design review. JAN FEB MAR APR JUNE JULYMAYDEC AUG SEP OCT NOV 77 3. Submit State Annual Application for a Type 10 Cannabis Retail License: June —August 2021 • Embarc will submit an annual state cannabis license application immediately after our CUP is approved. While the permit will not be approved until the City has completed its process, Embarc will mitigate some of the waiting period for State licensure by getting in the queue. Based on our ongoing communications with the Bureau of Cannabis Control, the State licensing process should take approximately 2 months. Phase III: June —August 2021: During this phase, we contemplate issuance of the use permit by the Planning Commission, issuance of building permits, and the subsequent commencement of construction. This is also the phase in which operation- alization of the business commences. 1. Approval of Use Permit and Public Benefit Agreement: June 2021* • Based on the City of Fresno’s public timeline, Embarc expects the land use permit to be approved by the Planning Commission as early as June if Staff is able to accommodate scheduling the item on the Commission’s agenda. • Based on a similar timeline, Embarc anticipates legislative approval on the public benefit agreement or development agreement. * If an appeal is filed, this timeline will likely be delayed to July or August 2021. 2. Issuance of Building Permit and Commencement of Construction: July 2021* • Because Embarc will have submitted its application for building permits simultaneous to all other required permits, the processing times for the other licenses should closely align with the design review and plan check timeline, i.e., a building permit should be issued shortly after all of the other licenses. At that point, the estimated ten-week construction process will commence. * If an appeal is filed, this timeline will be delayed to September 2021. 3. Initiate Operationalization: August 2021 • No later than 60 days prior to opening, Embarc will initiate operational preparations, including but not limited to the following: employment recruitment through job fairs, postings and partnership with workforce development partners; marketing plan development; and ongoing community outreach. Phase IV: August —September 2021: The final phase of the process includes the completion of construction, operations staging, issuance of a state annual license, and both soft and grand openings. 1. Operationalization: Ongoing Approximately 30 days prior to opening, Embarc will continue operational preparations, including but not limited to the following: finalize employee hiring, finalize vendor agreements; initiate marketing activities; full security implementation; set up IT infrastructure; and continue ongoing community outreach. A General Manager will be hired at least six weeks prior to opening to oversee the final JAN FEB MAR APR JULYJUNEMAYDEC AUG SEP OCT NOV JAN FEB MAR APR JULYJUNEMAYDEC AUG SEP OCT NOV 78 weeks of operationalization, oversee manager training and develop the initial inventory placement strategy. 2. Construction Concludes: September 2021* • Depending on whether an appeal is filed during the first phase, the 10-week construction timeline outlined by our contractor is anticipated to be completed as early as September 2021 or as late as November 2021. 3. Issuance of State License: September 2021* • State Type-10 commercial cannabis license immediately prior to Certificate of Occupancy. 4. Issuance of Certificate of Occupancy: September 2021* • Upon final sign-off on construction by building and other City officials, a Certificate of Occupancy will be issued. 5. Operations Staging: September 2021* • In the final two weeks prior to opening, Embarc will finalize pre-opening operational preparations, including but not limited to the following: conduct in-store employee training and vendor educa- tional workshops; inventory procurement and stocking; point-of-sale and track-and-trace trainings; on-site security and IT training; ongoing marketing and community outreach activities and a detailed compliance audit of all operations and components of the retail facility. During this time all final walkthroughs with the Police Department and relevant City staff will occur, including a tour for public safety officers and interested City officials. 6. Soft Opening: September 2021* • Business is fully licensed and compliant and commences soft opening that will last approximately 7-14 days to perfect operations. 7. Grand Opening: October 2021* • Grand Opening conducted with support of the Community Advisory Board and community leaders. * Or as late as December 2021, depending on whether an appeal is filed. Conclusion This section briefly summarizes the day-to-day operations that meet the industry best practices for a cannabis retail and delivery business as well as how such practices have been included in the business’ Standard Operating Procedures (SOPs). While not exhaustive of our comprehensive SOPs, this document is intended to demonstrate our team’s thorough understanding of compliance, security, best practices and their practical implementation. Direct responses to the remainder of Section 1.6. are below. 1.6.1. Fully describe the day-to-day operations if you are applying for a retail permit: i.Describe customer check-in procedures. Customer Check-In Procedures Per state and local laws and regulations, no one is permitted to enter the retail sales area until the guest’s 79 identification has been verified. This verification must confirm the person’s age, identity, and validity of a medical recommendation, if one is provided. A sign will be posted clearly and legibly at the entrance to the store stating that no person under the age of 21 is permitted to enter the premises. Embarc will verify the age and all necessary documentation of each potential customer to ensure they are not under the age of 18 for medical purchases or are at least 21 years old for adult use purchases. Age will be verified through a double verification process using the latest technology for identification verification: • Identification is verified immediately upon entry via the point of sale system, which scans an identification card and automatically inputs information necessary for the verification of identification and compli- ance purposes into our system • Staff will also utilize the CAV-2000, a portable age verification device, that is used as a redundant layer of security If the potential customer is 18-20 years old (and thus a medical patient), Embarc will confirm the customer’s possession of a valid physician’s recommendation and/or Medical Marijuana Card. Physician’s recommenda- tions will not be obtained or provided at our location. In the case of medical patients, access will be limited to individuals who are at least 18 years of age and have a valid physician’s recommendation for medicinal cannabis. All medical cannabis patients will be verified using the following procedures, which exceed state requirements: Upon entry, a medical patient will be asked to produce an acceptable form of identification for verification. Acceptable forms of identification include: • A document issued by a federal, state, county, or municipal government, or a political subdivision or agency thereof, including, but not limited to, a valid motor vehicle operator’s license, that contains the name, date of birth, height, gender, and photo of the person; • A valid identification card issued to a member of the Armed Forces that includes the person’s name, date of birth, and photo; or • A valid passport issued by the United States or by a foreign government. Once the patient’s identity is verified, they will be asked to produce a valid physician’s recommendation or state issued medical cannabis identification card. • If the patient produces a physician’s recommendation, the staff member will verify the following: • Staff will confirm the doctor’s license is active and in good standing using the California Medical Board’s online license verification program, BreEZe. • Upon verification that the physician’s license is in good standing and active, the staff member will utilize the online verification system provided by the doctor to verify that the medical recommenda- tion is valid. If no online platform is available, the staff member will call the physician’s office and manually verify the recommendation. • If the patient produces a state issued medical cannabis identification card, the staff member will utilize the official website administered by the California Department of Public Health to verify the patient’s identification card: • The California Department of Public Health’s Medical Marijuana Identification Card Program (MMICP) was established to create a state authorized Medical Marijuana Identification Card (MMIC), along with a web-based system for verification of MMICs issued. The MMICP web-based verification system allows law enforcement and the public to verify the validity of a qualified patient or primary caregiver’s MMIC as approved to possess, grow, transport, and/or use medical marijuana within California. Each MMIC is assigned a nine-digit Unique User Identification Number (UUID Number). By entering a UUID Number, you may verify the validity of an MMIC. 80 An MMIC is considered VALID if the UUID Number was assigned to an individual and the card is active. An MMIC is considered INVALID if the UUID Number was not assigned to an individual or the card is expired. MMICP does not receive or retain any personally identifiable information. Once the above procedures are complete the following outcomes are possible: • The patient is properly verified and allowed into the premises. Their information is entered into the Treez Point of Sale system and their records are stored in a HIPAA compliant database to meet state guidelines for record retention. • The patient’s verification fails and they are asked to promptly leave the premises and only to return with valid documentation. ii. Identify location and procedures for receiving deliveries during business hours. Location All deliveries are received through a separate and secure entrance that is not accessible to the public and is used exclusively for these purposes. The security officer tasked with vendor and driver escorts will control access to this access point from inside. Third party vendors will not have access to the premises beyond this lobby. This is to ensure no driver is provided access to the inventory room or has visibility into internal security procedures related to inventory room access. Procedures Embarc will only receive shipments of cannabis goods only from a licensed distributor or licensed microbusi- ness authorized to engage in distribution. During business hours, shipments of cannabis goods will enter the licensed premises through a secure, lobby and secure transfer area that is not available for use by the public. The following tasks outline Embarc’s procedures when receiving inventory. They will only be performed upon a previously scheduled and approved delivery of a shipment of inventory by a licensed distributor or licensed microbusiness authorized to engage in distribution to Embarc’s licensed premises. Unscheduled and unapproved deliveries will not be accepted. Shipments of cannabis goods may only be accepted from a licensed distributor or licensed microbusiness authorized to engage in distribution. Shipments of cannabis goods must be inspected for freshness. Cannabis goods that have exceeded their expiration or sell-by date may not be accepted. A shipment will be either accepted or refused in full. Embarc will not engage in any packaging or labeling of cannabis or cannabis products and will not accept any cannabis or cannabis products from a distributor that are not packaged for final sale. If an Embarc employee discovers there is a defect or nonconformity in an inventory shipment, they will refuse it. Furthermore, Embarc will not accept goods that have not passed laboratory testing, as described on a Certificate of Analysis. Types of records produced and maintained when acquiring new inventory may include a shipping manifest, a sales invoice or receipt, a bill of lading, and a certificate of analysis. The sales invoice or receipt needs to disclose, at minimum, Embarc’s legal business name and license number. Embarc will not accept any delivery of cannabis or cannabis products without receiving a copy of the shipping manifest containing necessary and accurate information from the licensed distributor or licensed microbusiness authorized to engage in distribu- tion responsible for making the delivery at least 24 hours prior to delivery. Embarc will receive the cannabis at a designated loading/unloading area, under video surveillance, of the licensed premises. 81 Prior to Acquiring Cannabis Goods • Embarc will confirm that it has already received the specific shipping manifest and Certificate of Analysis via CCTT-Metrc prior to a scheduled delivery of a shipment of cannabis goods. • Embarc will perform package counts on all current inventory and ensure labels and actual weights are reconciled before accepting any new inventory so as to more easily identify discrepancies at different stages. Receiving Shipments of Cannabis Goods at the Licensed Premises • Embarc may accept shipments of cannabis goods only between the hours of 6:00 a.m. Pacific Time and 10:00 p.m. Pacific Time. • During business hours, Embarc will not allow shipments of cannabis goods to enter the licensed prem- ises through an entrance or exit that is available for use by the public. • Embarc will inspect and accept the inventory in a limited-access area, under video surveillance. Accepting Cannabis Goods —Inventory Management • When a shipment of cannabis goods arrives, Embarc will inspect the scheduled delivery’s inventory and verify that the distributor or microbusiness authorized to engage in distribution has provided a shipping manifest. If there is no shipping manifest, Embarc will refuse the shipment. Embarc will record the refusal in CCTT-Metrc and indicate on the relevant manifest, invoice, or sales receipt, the specific reason for rejection. • Embarc will inspect the shipping manifest of the scheduled delivery of cannabis inventory and verify that the shipping manifest contains the following information: • The name and type of the cannabis goods • The UIDs of the cannabis goods • The amount of cannabis goods, by weight or count • The total wholesale cost of the cannabis goods • The estimated times of departure and arrival • The actual time of departure and arrival • The name, license number, and address of all licensees involved, such as the cultivator, the trans- porter, and Embarc • The driver’s license number of anyone driving the transport vehicle • The make, model, and license plate number of the vehicle used for transport • When information in the shipping manifest is suspect or inaccurate, Embarc will seek clarification or correction from the distributor, but refuse acceptance if warranted. Embarc will record the refusal in CCTT-Metrc and indicate on the relevant manifest, invoice, or sales receipt, the specific reason for rejection. • Embarc will reconcile all cannabis product package counts, labeling, and actual weights of the incom- ing shipment against the shipping manifest and CCTT-Metrc. When there is a discrepancy in weight or package reconciliation, Embarc will record and document the discrepancy in Embarc’s chosen internal seed-to-sale tracking system and in CCTT-Metrc and report the discrepancy to Embarc’s Inventory Manager. • Embarc will inspect the shipment of cannabis or cannabis goods for freshness. When cannabis or cannabis goods have exceeded their expiration or sell-by date Embarc will not accept them into its inventory. Embarc will record the refusal in CCTT-Metrc and indicate on the relevant manifest, invoice, or sales receipt, the specific reason for rejection. • Embarc will inspect the shipment’s labeling and packaging and ensure that all cannabis or cannabis products are labeled and packaged for final sale. When there is a defect to a label or package, or any is missing, Embarc will refuse the shipment. Embarc will record the refusal in CCTT-Metrc and indicate on the relevant manifest, invoice, or sales receipt, the specific reason for rejection. • Embarc will confirm that the cannabis goods in the shipment have all passed required testing. If they 82 have not passed testing, Embarc will refuse the shipment. Embarc will record the refusal in CCTT- Metrc and indicate on the relevant manifest, invoice, or sales receipt, the specific reason for rejection. • If the physical shipment and the shipping manifest are accurate, Embarc will sign the manifest. • Embarc will follow these steps when accepting a transfer in CCTT-Metrc: • Select the “Transfers” tab at the top of the page. • Click the “Incoming” button once on the Transfers page. • Under “Incoming”, select the transfer you wish to receive. • There will be a “Receive” option on the right-hand side; click “Receive”. • The system will bring up the packages that are currently included on the manifest transfer; verify the weight and count of each package. • Once you have verified the weight or the count, enter the received quantity. • Note: If you must reject the transfer, this is where you would do so. To reject a package, click the checkbox named “Reject Package” and select a “Reject Reason” from the dropdown menu. The Bureau will set up a list of available reject reasons. Enter a reason for the rejection in the “Notes” section. You can reject a transfer at any time if there is an issue with the package. Once you have verified the information entered, click “Receive Transfer” and the package will be sent back to the licensee that sent it to Embarc. • After verifying all of the information, select “Receive Transfer”. • Once you have received the transfer, that manifest will gray out and packages will have been entered into Embarc’s inventory under Embarc’s “Active Packages”. • Embarc will immediately place the inventory in the designated inventory storage room. • Embarc will retain the shipping manifest, bills of lading, any certificates of analysis, and any sales invoices or receipts in Embarc’s inventory tracking records in business records for seven years. Embarc will ensure that all records are legible, securely stored and are easily accessible upon request from the Bureau. iii. Identify the name of the Point-of-sale system to be used and the number of Point-of-Sale locations. Embarc utilizes Treez as its point-of-sale provider and will seek approval from the City to utilize this point-of- sale in Fresno. Treez is an enterprise-quality retail management software, built using the most sophisticated security systems available to increase security and productivity and resulting in faster transaction times for patients and consumers. The Treez system tracks and reports on all aspects of our commercial cannabis business including, but not limited to, such matters as cannabis tracking, inventory data, gross sales (by weight and by sale) and other information which may be deemed necessary by the City. We will ensure that the Treez system is compatible with the City’s record-keeping systems and can produce historical transactional data for review. Treez point of sale software manages and stores transaction information including records, reports, manifests, and any other documents generated by Embarc. Treez is an integrated software platform that automatically enforces best practices with a focus on compliance and loss prevention. Unique features of the Treez point of sale system include, but are not limited to, the following: • Flexibility • Customizable inventory locations mirror the physical workings of the store • Segment inventory by medical or recreational status, fulfillment type, or sales channel • Robust Fulfillment • Streamlining the process across in-store, express, pick up, and delivery orders from a centralized dashboard 83 • Captures orders from all eCommerce marketplaces and fulfills them from a single place to ensure real-time inventory management • Compliance • Built-in tools to safeguard against selling over state-specific purchase limits • Dynamic tax collection based on product type, customer classification, and delivery destinations • Real-time sale reporting to METRC • Insulation from track-and-trace outages through use of proprietary TraceTreez automation layer The Treez system utilizes an Application Programming Interface (API) to facilitate a direct online connection to METRC, the State’s Track and Trace platform, and pushes all the sales data to METRC in real time. This enables Embarc’s sales data from Treez to be uploaded directly to METRC, reducing risk of diversion, loss and theft, while maintaining the integrity and safety of cannabis products as they move through the supply chain. Furthermore, Treez allows Embarc to be in compliance with requirements that commercial cannabis businesses must have an accounting software system in place to provide point-of-sale data as well as audit trails for both product and cash, where applicable. Number of Locations of POS Systems in the Store There are six (6) point-of-sale locations in the retail sales area. Embarc’s point-of-sale areas and areas where cannabis goods are displayed for sale will be recorded on the video surveillance system. At each point-of-sale location, camera placement will allow for the recording of the facial features of any person purchasing or selling cannabis goods, or any person in the retail area, with sufficient clarity to determine identity. Surveillance displays including sensitive areas (inventory storage and point-of-sale areas) will be maintained in areas limited to management or security officer viewing. Point-of-sale stations are distributed evenly throughout the sales area and allow for proper social distancing. While the renderings do not depict transaction shields, Embarc will utilize transaction shields to protect our employees and customers and ensure safety regarding virus transmission. As detailed above, point-of-sale stations include the ability to accept debit and credit card payments given that we are fully banked. Furthermore, cash drawers are built into the cash wrap furniture rather than placed on top of the counter as an additional layer of security. Pass-through windows and slide-out trays to the exterior of the premises will be strictly prohibited, and Embarc will not operate any form of drive-through point-of-sale location. iv. The estimated number of customers to be served per hour/day. Embarc’s customer traffic and staffing projections are based on the company’s existing operations as well as best practices developed by a team with more than ten years of cannabis retail operational experience in California. Based on this practical experience and actual results, and as indicated in our revenue projections and pro forma, we can expect that, on average: • Embarc anticipates serving approximately 291 customers per day • Given an average visit time of fewer than ten minutes per customer, Embarc is equip to service approxi- mately 50 customers per hour 84 • Embarc anticipates it will see between 20 and 25 customers per hour in peak hours, and between 5 and 20 customers per hour in non-peak hours Embarc will be appropriately staffed to handle customer traffic given the tremendous importance of customer service, education and compliance. To maintain customer service and security protocols, we will maintain no higher than a 3-to-1 customer to staff ratio onsite. This does not mean that there are three customers to one staff person on the sales floor given not all customers arrive at the same time each hour. Rather, it is a reflection of the ratio when contemplating total customers per hour. In practice, this effectively means an approximately one-to-one to two-to-one ratio depending on the cadence of customer arrival. Embarc employs a variety of methods to manage and maintain an appropriate ratio on the sales floor, including but not limited to the use of the waiting room during high volume hours. This is important for many reasons: • Embarc must protect the ability of our security team to effectively monitor customer flow; and • Embarc must protect the ability for Guides to effectively educate customers through one-on-one, personalized interaction The below chart is an expression of the anticipated number of expected customers and staff on site per hour each day. The blue bars indicate number of customers per hour, while the orange bars indicate the number of staff needed to handle customer volume per hour. The green line across the top represents the ratio of custom- ers to staff. v.Describe the proposed product line to be sold and estimate the percentage of sales of flower and manufactured products. Product Curation Ethos California has a rich history of cannabis cultivation and product innovation, with thousands of brands and hundreds of thousands of SKUs on the market. For most consumers, including many people who are new to cannabis or are re-entering the market for the first time in decades, this proliferation of brand and product optionality is overwhelming, leaving folks uncertain where to start. Embarc seeks to fill that void through our knowledgeable sales associates (“Guides”) that provide one-on-one attention to navigate customers through our curated product selection. Because each person’s body metabolizes cannabis differently, it is important to find the best product to meet an individual’s unique needs. 85 Our guiding ethos is values-driven curation rather than vertical integration. We want our Guides motivated to find the best product for an individual based on his or her unique needs rather than incenting Guides to push our own products to create a double bottom line. Our motivation is pure —we want what is best for each customer that walks through our door, and often that may require a specialty product or unique terpene profile only available by one cultivator. As such, the Embarc team serves as agnostic Guides in helping patients and consumers navigate our curated product selection to find what is best for each individual. We seek to balance and uplift. Embarc respects and honors the people who have been employing sustainable farming practices for generations and those who have fought to pave the way for companies like Embarc to operate. We don’t want to be an Embarc store full of Embarc products —for us, it’s about connecting the consumer to everything the cannabis industry has to offer, especially the small, sustainable farmers and producers. Farm to fork, or in this case farm to shop … that’s what California is known for and should celebrate. Lauren Carpenter, Chief Executive Officer Embarc’s brand and product curation is driven by the following guiding principles: 1. Uplift Rather Than Dominate For decades, cannabis has centered around community and communality, values that are important to maintain as an industry and within society. To that end, we believe in the power of prosperity through partnership, or the ability to uplift an entire ecosystem rather than centralize power in one company that seeks to dominate the supply chain. Partnering with small farmers, celebrating sustainable farming practices, and finding opportunities to amplify local, minority and female-owned brands is how we uplift one another and maintain the cannabis community and ecosystem. It also allows for shared prosperity rather than a monopoly. We believe in the power of prosperity through partnership, or the ability to uplift an entire ecosystem rather than centralize power in one company that seeks to dominate the supply chain. 2. Share Values, Cultivate Culture As brands and products continue to come to market, consumers have more selection than ever before. This can be very overwhelming, leaving folks uncertain where to start. Embarc asks a few key ques- tions when contemplating a brand partner for our shelves, because shared values are the cornerstone of cultivating culture within our companies, our communities, and the industry at large: (1) Does this brand have defined values? (2) Do those values share commonality with our own? (3) Does the brand live its values? (4) Would our customers appreciate the opportunity to explore this new modality / strain / SKU? 3. Data Driven Decision Making While values are the first step in determining whether a brand or product is the right fit for our curated selection, data is the other critical component. For most dispensaries, inventory decisions are centralized via a designated buyer. Historically, that buyer has made decisions about what brands and products to put on shelves based on which brands were coming to the 86 shop and providing the most enticing deals. We believe consumers deserve better than that, and thus we have implemented extensive data analysis and customer feedback loops into our purchasing process. In consultation with the VP of Retail, our buying and inventory management team uses ongoing data analysis, consumer surveys, questionnaires, customer recommendations and requests, and predictive analytics to drive purchasing decisions. This ensures our shelves are stocked with what our customers want, not with whatever brand has provided discounted product to the buyer. This data and feedback loop are what ensure our curated selection is responsive to consumer behavior, purchasing patterns and preferences. Our product selection is partially informed by our experience operating successful cannabis retail elsewhere. We are constantly scrutinizing and analyzing which products our customers and patients are responding to and adjusting our product selection accordingly. We will use what we have learned to build upon, and continue to evolve, our product selection based on the feedback and needs of our customers and patients in Fresno. This localized approach ensures our curation is rooted in values, local preferences, sustainability, local sourcing (when available) and economic viability. Local Sourcing Given our 24-acre production site in Mendota, and our desire to collaborate with a proposed equity incubator campus in Fresno, we expect to carry a significant amount of locally cultivated, manufactured and produced goods. We have committed to at least 20% shelf space for these local goods but anticipate it will likely be upwards of 50% once the local brands are operational. Product Types In addition to prioritizing small farms, local cultivators and manufacturers, and amplification of Black, Indigenous and people of color (BIPOC), female and LGBTQIA+ owned brands, Embarc focuses on products that are non-psychoactive. Many of the products we will carry will not contain tetrahydrocannabinol, or “THC,” the psychoactive substance found in many adult-use products. Instead, we will focus heavily on products that contain cannabidiol or “CBD,” a non-psychoactive substance found in FDA-regulated products such as Epidiolex. We will offer high-quality, consciously crafted cannabis products, including sustainable flowers, concentrates, edibles, topicals, tinctures and administering tools. We will help customers understand the health and wellness benefits of integrating cannabis into one’s lifestyle rather than the traditional emphasis on getting high. While we will still carry traditional adult-use products, our associates will be trained to advise customers on the availability of non-psychoactive products that may also provide the effects they are seeking. Embarc will only conduct business with other State licensed cannabis businesses who can provide proof of their State license certificate. Our team members have established business relationships with the leading suppliers in the space through their existing work over the past decade in the industry. These partnerships ensure that when Embarc Fresno opens to the public, it will be able to consistently meet consumer demand for quality product without interruption. 87 Some of the products carried will include: Average or Expected Sales Amounts by Product Type Adult use cannabis sales have been legal in California since January 1, 2018, with final regulations governing the industry put in place in 2019. Because Proposition 64 included provisions allowing for local control, approx- imately 60-70% of the state has not yet legalized local adult use cannabis sales. As a result, market research on consumption patterns and sales by category is still shifting rapidly. TOPICALS TINCTURES PRE-ROLLS FLOWER EDIBLES 88 This short window of legal adult use sales indicates that consumer behavior is evolving as new products and consumption methods gain prominence in the marketplace and additional jurisdictions begin permitting local sales. Because no adult use cannabis businesses are currently operating in Fresno, there is no market data to dictate local sales by product category, and data indicates that a variety of factors dictate consumption behavior, including geography, accessibility, and average age of the local population. However, we can extrapolate estimates on sales by product type based on industry-wide data as well as data from our Tahoe location. Historically, the traditional dispensary model has focused heavily on flower. However, Embarc’s business model is focused on high-CBD, low-THC products and a variety of topicals, edibles and tinctures to meet the health and wellness needs of customers including aging populations. This deviates from the traditional emphasis on ‘getting high’ and will require a highly knowledgeable staff focused on providing patient and consumer educa- tion on the variety of cannabis consumption methods available and their benefits. As you can see below, our sales for topicals, sublinguals and edibles —which are typically associated with higher CBD concentrations and management of aches and pains —is higher than industry average, while our sales of concentrated cannabis, vapes and flower are lower than industry average: Percent of Sales by Category PRODUCT CATEGORY EMBARC INDUSTRY AVERAGE Concentrates (wax + vapes)25%31% Edibles 20%14% Flower 25%40% Pre-Rolled 20%10% Topicals 2%1% Sublinguals 3%2% Other Cannabis 5%2% 100%100% Note: Industry average percentages are provided by BDS Analytics, a leading cannabis data and analytics firm for California cannabis. We believe this category breakdown will be similar in Fresno as our guides are trained to educate consumers on the values of enrichment instead of the traditional focus on ‘getting high’. We have found that when consumers are educated on our product selection they often opt for products that are not formulated solely for their ability to get the consumer high which we believe is critical from a public health and safety perspective. vi. If proposed, describe delivery service procedures, number of vehicles and product security during transportation. Delivery Service Procedures Prior to discussing specific procedures, we would be remiss not to mention the ruling made on November 20, 2020 in a Fresno District Court whereby a judged dismissed a case that centered around whether or not California jurisdictions could ban cannabis delivery. Even though the case was dismissed, the Bureau of Cannabis Control acknowledged that cities and counties do have the ability to regulate deliveries of cannabis from outside their borders. As such, our proposed delivery will only operate within the city limits of Fresno and in jurisdictions where delivery has not been banned locally. As extensively discussed throughout this proposal, compliance is the cornerstone of the Embarc business model. As such, Embarc will comply will all relevant State laws and regulations as well as the Fresno 89 Municipal Code. More specifically: • Embarc will verify the age and necessary documentation of each customer to ensure that medical customers are at least 18 years of age. If the potential customer is 18 to 20 years old, Embarc will confirm the customer’s possession of a valid physician’s recommendation and/or Medical Marijuana Card. Physician recommendations will not to be obtained or provided at the retail or delivery location. For adult-use purchases, Embarc will verify that all customers are at least 21 years old. • Operating hours will be limited to the hours of 7:00 a.m. through 10:00 p.m., seven days a week, unless specified otherwise by the Chief of Police. • Prior to commencing delivery operations, and prior to the use of any new car in delivery operations, Embarc will provide the City with the following information for all vehicles that will be used to deliver cannabis or cannabis products: • Proof of ownership or a valid lease; • The year, make model, color, license plate number; • Vehicle Identification Number; • Proof of insurance; and • Embarc will notify the City in writing of any changes to this information within 30 calendar days of such a change. • Embarc will not deliver cannabis or cannabis products to an address located on publicly owned land or to a building leased by a public agency. • Embarc will not utilize any kiosk, iPad, tablet, smartphone, fixed location or technology platform, whether manned or unmanned, that facilitates, directs, or assists in the retail sale or delivery of canna- bis or cannabis products at a location other than one permitted by the City As mandated by law, all deliveries of cannabis goods will be performed by a delivery employee of Embarc in an inconspicuous, secure vehicle. Each Embarc delivery employee will be at least 21 years of age. All deliveries of cannabis goods will be made in person. A delivery may not be left unattended at a delivery location in lieu of an in-person transfer to the customer. A delivery of cannabis goods will not be made through the use of an unmanned vehicle. The process of delivery begins when the delivery employee leaves Embarc’s licensed premises with the canna- bis goods for delivery. The process of delivering ends when the delivery employee returns to Embarc’s licensed premises after delivering the cannabis goods to the customer(s). Cannabis goods being delivered must be sourced from Embarc’s licensed premises and may not be sourced from any other premises (e.g. separate storage facility, cannabis processing, manufacturing or distribution premises) —regardless of whether that premises is licensed, owned or operated by Embarc. During the process of delivery, Embarc’s delivery employee may not engage in any activities except for canna- bis goods delivery and necessary rest, fuel, or vehicle repair stops. Delivery employees will, during deliveries, carry and provide to any regulator/peace officer upon demand: • A copy of the Fresno dispensary permit • A valid driver license (government issued identification) • A valid certificate of vehicle registration • A valid commercial auto insurance policy for the vehicle used • A valid City of Fresno cannabis employee permit 90 • A printed ledger of cannabis goods on board • A printed ledger of orders in the process of being delivered • An employee identification badge provided by the employer pursuant to Section 5043 of the Cannabis Control Act, and • A copy of the non-storefront retail license and a copy of the QR Code certificate issued by the Bureau of Cannabis Control. The QR Code certificate will comply with the following requirements: (1) The QR Code certificate will be printed on paper not less than 8 ½ inches by 11 inches; (2) The QR Code on the certificate posted will not be less than 3.75 inches by 3.75 inches; and (3) The QR Code on the certificate will be of sufficient clarity that the code can be read by a smartphone or device capable of reading QR Codes from a distance of at least three feet. Embarc acknowledges that it may only deliver cannabis goods to a physical address in California and that the delivery employee will not leave the State of California while possessing cannabis goods. Embarc will not deliver cannabis goods or accessories to: • Any location on publicly owned land or owned, leased or occupied by a public agency including but not limited to a public school, library or community center; • Any private property open to the public, including but not limited to business and professional offices, retail stores and their adjacent parking lots, places of assembly, or food/beverage establishments. Embarc’s delivery employee carrying cannabis goods for delivery will only travel in an enclosed motor vehicle. Any vehicle used in the delivery of cannabis goods will be operated by a delivery employee of Embarc. Only an employee of Embarc for whom delivery is being performed will be in the delivery vehicle. While carrying cannabis goods for delivery, Embarc’s delivery employee will ensure the cannabis goods are not visible to the public. Cannabis goods will be locked in a box, container, or cage that is secured on the inside of the vehicle. For purposes of this section, the inside of the vehicle includes the trunk. Embarc’s delivery employee will not leave cannabis goods in an unattended motor vehicle unless the motor vehicle is locked and equipped with an armed vehicle alarm system. Vehicles used for delivery will be outfitted with a dedicated Global Positioning System (GPS) device for identifying the geographic location of the delivery vehicle in real-time. A dedicated GPS device must be owned by Embarc and used exclusively for delivery operations. The device will be either permanently or temporarily affixed to the delivery vehicle and will remain active and inside of the delivery vehicle at all times during delivery allowing Embarc to identify the geographic location of all vehicles out for delivery. This information will be provided to the Bureau of Cannabis Control or law enforcement personnel upon request. Embarc acknowledges that upon request, it will provide the Bureau of Cannabis Control or law enforcement personnel with information regarding any motor vehicle used for the delivery of cannabis goods, including the vehicle’s make, model, color, Vehicle Identification Number, license plate number and Department of Motor Vehicles registration information. Embarc acknowledges that any motor vehicle used to deliver cannabis goods is subject to inspection by the Bureau of Cannabis Control and local regulators. Vehicles used to deliver cannabis goods may be stopped and inspected by the Bureau of Cannabis Control or local regulators at any licensed premises or during delivery. Embarc’s delivery employee will not carry cannabis goods in the delivery vehicle in excess of at any time. The value of cannabis goods will be determined using the current retail price of all cannabis goods carried by, or within the delivery vehicle. 91 Embarc’s delivery employee may only carry cannabis goods in the delivery vehicle and may only perform deliveries for one licensed retailer at a time. A delivery employee must depart and return to the same licensed premises before taking possession of any cannabis goods from another licensee to perform deliveries. Embarc’s delivery employee will not leave the licensed premises with cannabis goods without at least one delivery order that has already been received and processed by Embarc. Before leaving the licensed premises, Embarc’s delivery driver must have a delivery inventory ledger of all cannabis goods provided to Embarc’s delivery driver. For each cannabis good, the delivery inventory ledger will include the type of good, the brand, the retail value, the track and trace identifier, and the weight, volume or other accurate measure of the cannabis good. After each customer delivery, the delivery inventory ledger must be updated to reflect the current inventory in posses- sion of Embarc’s delivery driver. Embarc will use and maintain computer software to record the following information relating to each delivery: • Date of order/request • Full name of person requesting delivery • Address to which cannabis goods are being delivered • Description of cannabis goods being delivered, including adult or medicinal designation • Name of the employee delivering the cannabis goods, and • Date and time the delivery was made Embarc’s delivery driver will maintain a log that includes all stops from the time Embarc’s delivery driver leaves the licensed premises to the time that Embarc’s delivery driver returns to the licensed premises, and the reason for each stop. The log will be turned in to Embarc when Embarc’s delivery driver returns to the licensed premises. Embarc must maintain the log as a commercial cannabis activity record as required by the Cannabis Control Act. Prior to arrival at any delivery location, Embarc must have received a delivery request from the customer and provided the delivery request receipt to Embarc’s delivery driver electronically or in hard copy. The delivery request receipt provided to Embarc’s delivery driver will contain all of the information required in Section 5420 of the Cannabis Control Act, except for the date and time the delivery was made, and the signature of the customer. Immediately upon request by the Bureau of Cannabis Control or any law enforcement officer, Embarc’s delivery driver will provide: • All delivery inventory ledgers from the time Embarc’s delivery driver left the licensed premises up to the time of the request • All delivery request receipts for cannabis goods carried by the driver, in the delivery vehicle, or any deliveries that have already been made to customers, and • The log of all stops from the time Embarc’s delivery driver left the licensed premises up to the time of the request If Embarc’s delivery driver does not have any delivery requests to be performed for a 30-minute period, Embarc’s delivery driver will not make any additional deliveries and will return to the licensed premises. Required meal periods will not count toward the 30-minute period. 92 Upon returning to the licensed premises, all undelivered cannabis goods will be returned to inventory and all necessary inventory and track-and-trace records will be updated as appropriate that same day. Embarc’s delivery employees will not consume cannabis goods while delivering cannabis goods to customers. Embarc will prepare a hard copy or electronic delivery request receipt for each delivery of cannabis goods. The delivery request receipt will contain the following: • The name and address of Embarc • The first name and employee number of Embarc’s delivery employee who delivered the order • The first name and employee number of Embarc’s employee who prepared the order for delivery • The first name of the customer and a retailer-assigned customer number for the person who requested the delivery • The date and time the delivery request was made • The delivery address • A detailed description of all cannabis goods requested for delivery —the description will include the weight, volume, or any other accurate measure of the amount of all cannabis goods requested • The total amount paid for the delivery, including any taxes or fees, the cost of the cannabis goods, and any other charges related to the delivery, and • Upon delivery, the date and time the delivery was made, and the handwritten or electronic signature of the customer who received the delivery At the time of the delivery, the delivery employee of Embarc will provide the customer who placed the order with a hard or electronic copy of the delivery request receipt. The delivery employee will retain a hard or electronic copy of the signed delivery request receipt for Embarc’s records. While making deliveries of cannabis goods, Embarc’s delivery employee will only travel from Embarc’s licensed premises to the delivery address; from one delivery address to another delivery address; or from a delivery address back to Embarc’s licensed premises. A delivery employee will not deviate from the delivery path described in this section, except for necessary rest, fuel, or vehicle repair stops, or because road conditions make continued use of the route unsafe, impossible, or impracticable. All records relating to deliveries of cannabis goods will be maintained by Embarc for a period of no less than seven (7) years. Such information will be made available to the City of Fresno upon request. Vehicle Standards Vehicles used for the retail delivery of cannabis and related currency will: • Be owned and registered to Embarc • Be less than ten years old at all times during its service life • Be insured through a commercial auto policy providing no less than $1M in personal injury and prop- erty damage coverage per occurrence • Be f ree of graphics or other markings indicating that the vehicle is associated with cannabis delivery • Be equipped with an audible car alarm system configured to also cause flashing of vehicle headlamps and brake lamps upon activation • Be equipped with a permanently mounted commercial grade safe dedicated to cannabis products • Be equipped with a permanently mounted commercial grade drop safe dedicated to currency • Be equipped with GPS tracking technology providing for real-time monitoring through a standard web browser. Proprietary software will not be required to access real-time monitoring. Access to GPS data will be restricted to management personnel. Managers will have unique logins and strong passwords 93 incorporating letters, numbers and special characters. GPS will report location data no less frequently than every one minute. GPS data will be maintained for a period of no less than 90 days. Upon request, GPS data will be made available to regulatory agencies. Testing of GPS systems for accuracy and reliability will be performed on a daily basis. Testing will be recorded by the Security Director. Devices experiencing technical difficulties relating to GPS operability or accuracy will not be used for cannabis delivery until such time as the GPS tracking system is restored to full func- tionality. Embarc will maintain a ledger of all vehicles used in delivery operations and will make such ledger available to the City of Fresno upon request. The ledger will include, at minimum, the make, model, color and license plate/VIN information of each vehicle. Live Monitoring Embarc utilizes appropriate technologies providing for: • Route planning of scheduled deliveries by a Manager • Real-time route deviation notification to a Manager • Assignment of an employee or Manager tasked with real-time monitoring of delivery vehicles and personnel • Push-to-talk communications between delivery personnel and the monitoring agent • Ongoing communication between the delivery agent and the monitoring agent incorporating routine status checks and voice notifications relating to each arrival and departure from a scheduled delivery point, and • The licensee will incorporate a code-word to be broadcast by delivery drivers if they are under duress Customer Validation Embarc will verify the age and necessary documentation of each customer to ensure that medical customers are at least 18 ears of age. If the potential customer is 18 to 20 years old, Embarc will confirm the customer’s possession of a valid physician’s recommendation and/or Medical Marijuana Card. Physician recommendations will not be obtained or provided at the retail or delivery location. Prior to scheduling of a delivery, customers will be required to remit evidence of identity/age that coincides with the residential address to which the delivery is being made. This may be by way of providing a govern- ment issued ID and a recurring bill or through credit card validation. Destination Validation • Prior to dispatching a delivery driver to a customer location, Embarc will verify that the address to which the delivery is scheduled is in fact an actual, existing address of public record in the city or county to which the delivery is being made. • Embarc will maintain an up to date accounting of cities and counties within their service area and will ensure compliance with their respective municipal codes, county ordinances or business licensing regulations as they may relate to the delivery of cannabis products in these cities and counties. Embarc acknowledges that while Section 26090 of the California Business and Professions Code prohibits a local authority from outright preventing delivery of cannabis into its jurisdiction, Section 26200 of the California Business and Professions Code does grant local authorities the power to develop and enforce business licensing regulations that may relate to delivery of cannabis products within their jurisdiction. Embarc will ensure compliance with any such local ordinances or regulations as they pertain to any cities or counties to which they deliver cannabis products. 94 Safe Haven Identification Embarc will identify, for each area in which a delivery is scheduled, a designated safe zone. The safe zone is a location that the delivery driver will be directed to respond to in the event that the driver is being followed. Safe zones will be highly populated, well lighted locations known to be equipped with surveillance equipment, law enforcement or security personnel. These may include major shopping malls, major airports, major hospital emergency departments, major universities or similar high-density environments. Number of Delivery Vehicles In order to sufficiently meet anticipated delivery demand, Embarc anticipates securing five delivery vehicles. These vehicles are estimated at per year, comprised of 5 vehicles at per vehicle per month, or per vehicle per year. Prior to commencing delivery operations, and prior to the use of any new car in delivery operations, Embarc will provide the City of Fresno the following information for all vehicles that will be used to delivery cannabis or cannabis products: • Proof of Ownership or a valid lease • Year, make, and model, and color of the vehicle • License plate number of the vehicle • The Vehicle Identification Number • Proof of Insurance Embarc will notify the City in writing of any changes to this information within 30 calendar days of such change. Product Security During Transportation and Delivery All employees who will serve as delivery drivers will complete a course of training on robbery prevention. The course of instruction will include the following training points: • Maintain a high visual horizon to identify potential threats early. Consistently be on the lookout for suspicious persons loitering in the areas of a delivery. Where suspicious persons are present upon arrival, delay the delivery and retreat to a safe location to notify your supervisor. The supervisor will determine the course of action whether that be to terminate the delivery, delay the delivery or deploy a security detail to supervise the delivery. • Be cognizant of other vehicles that may be following you on your route. As suspicions of following arise, broadcast the vehicle description, license plate and description of occupants to your supervisor without delay. The supervisor will direct you, based on your present location as shown by GPS, to an alternative route and toward a designated safe haven in order to determine if the suspicious vehicle is in fact attempting to follow you. • Where the suspicious vehicle changes course and continues to follow, the supervisor will notify law enforcement and will direct the delivery driver to proceed to the nearest manned law enforcement facility. • If lighting conditions are poor upon arrival at the delivery location, delay the delivery and coordinate with your supervisor. The supervisor will contact the customer and require that exterior lighting at their residence be turned on to enhance the safety of the delivery driver upon his or her arrival. • Keep the doors to the vehicle locked at all times. • Keep the windows up at all times. • Always visually inspect the interior of the vehicle prior to entering it. • Keep the vehicle key separated from any facility keys that you are issued. • Ensure that your issued cellular phone is always on and kept on your person at all times during your shift. 95 • Ensure that the cellular 911 equivalent for police is programmed into your issued cell phone for the jurisdiction that you are delivering to. Depending on your proximity to city/county borders, your calls for local police may be diverted to the California Highway Patrol if calling 911 from a cellular phone. This can create delays in your emergency call making its way to the proper local authority. • When taking breaks, completing paperwork, eating a meal or otherwise, remember that you are still exposed and must be cognizant of your surroundings. Avoid stopping or parking in isolated or dark areas. • Watch what you say. Avoid making statements indicating that you make for a good target. • Avoid telling customers or others that you have been busy, that business is good, or other remarks that may incentivize a person to rob you of product or currency. • Never disclose your route plan to outside parties or other employees without a legitimate business need to know. If other employees ask about your assigned route, notify a supervisor. This includes a prohibi- tion relative to social media check-ins and use of location sharing applications. • If upon returning to your vehicle you find a flyer, note or other item upon your delivery vehicle, do not address it. Immediately leave the area and proceed to a populated, lighted area before investigating the item further. • If, upon returning to your vehicle you find that your vehicle has been blocked in or disabled (flat tire, severe vandalism), retreat to the customer’s premises and request safe harbor while notifying your supervisor and determining a course of action (law enforcement notification, summoning of a security detail). Robbery Management A robbery is defined by law as the taking of property by means of force, threat or fear. A weapon is not required for a person to commit a robbery. The threat of a weapon or creating fear by other means is sufficient to accomplish the crime of robbery. Robbery is a significant felony and a crime of violence —even where no injury occurs. Robbery is not theft. Theft is a comparably minor offense that does not involve the use of force, threat or fear. Considering the serious nature of a robbery, those committing this crime are often well aware of the risk they are taking. This can result in heightened stress on the part of the criminal and can contribute to the criminal making rash and thoughtless moves. To reduce the likelihood of violence in these circumstances, it is paramount that any employee remain calm, polite and follow the instructions of the robber. Furthermore, the employee should: • Assume the assailant is armed, regardless of whether the assailant shows, references or infers that he or she is armed. • Cooperate. Do not attempt to disarm, disrupt, delay or defend against the taking of property. Cooperate only to degree you are asked to. Do not offer additional insight, information or intelligence that may assist the robber in achieving more than they intended. • Try to focus on remembering a good description of the suspect(s) and their vehicle(s), as well as a description of any weapons displayed or discussed by the suspect(s). • Once the suspect(s) have left the area, notify police without delay. Notify police first, before notifying your supervisor/dispatcher. • Protect any evidence that may be left behind. This includes anything the suspect(s) may have touched, moved or dropped (e.g. cigarette butts, beverage container). • If any witnesses were present, ask them to remain until police arrive. Auto Burglary Prevention Embarc will ensure that delivery vehicles are protected after-hours. Delivery vehicles will be stored in a locked state with its alarm armed. No product or currency will remain in vehicles while stored after-hours. If parked outdoors after-hours, lighting in the parking area will be at or above 1.5-foot candles of luminance and under consistent monitoring by surveillance cameras. Drivers will, in the course of delivery operations: 96 • Ensure that vehicle windows are up, doors and locked, and the alarm is armed at any time that they are away from the vehicle in the course of deliveries or on breaks. • Never leave any items in plain view within the vehicle. Drivers who elect to bring a personal bag/lunch/ snacks on the road with them will be required to stow these items in the trunk of the vehicle if left unattended in the vehicle. • Keep the interior of the vehicle free of any visible bags, boxes or valuables that may entice an opportu- nistic offender to commit a burglary against the vehicle. • Not park next to occupied vehicles. • Not park in unlighted, isolated areas. • Be cognizant of surveillance cameras and, where possible, park in their viewing area. Auto Burglary Management • If suspects are seen or witnesses are present and the crime is fresh, notify police via the emergency number (crime in progress). • If suspects are not seen and no witnesses are present, notify police via the non-emergency number. Expect to be directed to do an online report for this type of crime. • Visually canvass the surrounding area for surveillance cameras. If present, include their locations in your police report to assist investigators who may follow up on the crime. • Notify your supervisor of the crime of what, if any, inventory or currency was acquired. • Prior to operating the vehicle, inspect it for safety hazards (see if the ignition has been tampered with, if under-dash wiring has been manipulated, verify the hood and trunk latches have not been released prior to driving the vehicle). Auto Theft Prevention Auto theft is a prevalent crime in California. Auto theft is a crime often accomplished in a matter of seconds, and often by experienced offenders who can perform this crime without arousing suspicion of bystanders. In other cases, it is a crime committed by joyriders who take advantage of an unsuspecting motorist who left their vehicle running or who left their keys in the vehicle or accessible nearby the vehicle. Much like auto burglary prevention and to reduce the likelihood of auto theft, Embarc will ensure that delivery vehicles are protected after-hours. Delivery vehicles will be stored in a locked state with its alarm armed. No product or currency will remain in vehicles while stored after-hours. If parked outdoors after-hours, lighting in the parking area will be at or above 1.5-foot candles of luminance and under consistent monitoring by surveil- lance cameras. Drivers will, in the course of delivery operations: • Ensure that vehicle windows are up, doors and locked, and the alarm is armed at any time that they are away from the vehicle in the course of deliveries or on breaks/ • Not park next to occupied vehicles. • Not park in unlighted, isolated areas. • Be cognizant of surveillance cameras and, where possible, park in their viewing area. • Never leave the vehicle running while unattended. • Never leave vehicle keys unattended. • Never leave vehicle keys in the vehicle (e.g. when refueling). Auto Theft Management • If a vehicle is stolen from the licensed premises, the premises manager will notify the Fresno Police Department immediately upon the discovery of the theft. • If a vehicle is stolen in the course of delivery operations, the theft will be deemed a crime in progress and immediately reported to the law enforcement agency of jurisdiction through the emergency number (911 or cellular equivalent). 97 • Visually canvass the surrounding area for surveillance cameras. If present, include their locations in the police report to assist investigators who may follow up on the crime. • Notify the supervisor of the crime of what, if any, inventory or currency was acquired. Conclusion Given the City’s mandated spatial restraints, the above business plan contains only direct responses to the prompts rather than a comprehensive business plan. We welcome the opportunity to provide more detail on any component of the business and its proposed Fresno operations. 98 Section 7: Community Benefits And Investments Plan Introduction —A Demonstrated Track Record During the ordinance development process, and in our discussions with myriad community groups, stake- holders and elected leaders to inform the development of this community benefits and investments plan, a common refrain was the City’s desire that, if an existing operator is selected, it must be able to demonstrate a track record of follow through on commitments to the community. Thus, prior to outlining our commitment in Fresno, we felt it was prudent to outline a brief summary of Embarc’s demonstrated track record in South Lake Tahoe, where our community outreach and social equity efforts have already made tangible, lasting impact. We are proud to serve as a partner to the City, local non-profit organizations, and residents in a variety of ways. To illustrate our delivery on this commitment, our conditions of operation with the City of South Lake Tahoe include: • Providing the City with 6% of its gross receipts as a voluntary community public benefit. • Created a voluntary Community Investment Fund that receives ongoing funding from sales to support public safety programs. • Funding a portion of the Public Safety Impact Mitigation Fee to provide for dedicated policing of cannabis businesses and to address cannabis-related community impacts. • Partnered with local non-profit organizations to provide ongoing financial support. • Engaged a local Community Advisory Board to assist the company in making strategic decisions on issues ranging from non-profit partners to education campaigns. • Maintains a compassionate use program intended to provide compliant low-cost and/or no-cost canna- bis for low income and seriously ill patients. • Maintains a paid employee volunteerism program covering up to 40 hours per year. • Utilizing local goods and services where feasible and practical. • Develops local business partnerships for cross-marketing and promotion. Embarc is delivering on these commitments: To City Leadership I am the Financial Services Manager for the City of South Lake Tahoe and can confirm that Embarc Tahoe LLC is currently in good standing with their Community Public Benefit Fee.” Olga Tikhomirova, Financial Services Manager We deserve cannabis operators that will put us first, engaging with the neighborhood, contributing to civic and community causes, and generally creating a business that not only does no harm, but actively seeks to do good in our community. Embarc is this partner. The company’s leadership team has been steadfast in their commitment to operating a compliant cannabis dispensary that appropriately educates and engages with their customers, the neighborhood and the community-at-large. Jason Collin, Mayor of South Lake Tahoe To Non-Profit Partners The Advisory Board comprised of local community organizations, including our Drug Free Coalition, holds Embarc accountable to our community, while also advising them on how to distribute their business donations. Embarc is committed to philanthropy and in the short time they have been open, 181 have already donated thousands of dollars to local non-profits. I feel strongly that businesses permitted to retail cannabis must conform to the highest standards of ethics and business practices, and be willing to work with and support local nonprofits and youth organizations. In Embarc you will find a business that exemplifies those standards, and provides meaningful support and engagement with the local community. Jude Wood, Executive Director of Boys and Girls Club of Lake Tahoe We are grateful for Embarc’s commitment to supporting the students of Lake Tahoe Community College through scholarships and workforce development opportunities. These make a tangible impact in the lives of students. Professor Walter Morris, Ph.D., Board Member, Lake Tahoe Community College Foundation To Our Employees As a longtime local resident of South Lake, I am proud to work for a company that has made giving back to our community the core of our business model. Amber D. I am proud to be part of a team that wholeheartedly embraces strong female leadership and diversity across every aspect of the organization, from who we hire to what brands we put on our shelves. Embarc has created a space where I feel comfortable being my authentic self. What more could you ask for? This is a dream realized. Jacie M. To Patients and Consumers 182 To Brand Partners We are thrilled to work with Embarc as our retail partner in South Lake. The Embarc team is passion- ate and educational with patients and customers and lives their values by amplifying small brands and cultivators. Todd, Founder of Highrize Embarc is a wonderful retail partner to VetCBD. They have worked with our team to donate a portion of sales to the Humane Society of Truckee-Tahoe, demonstrating their commitment to giving back. Destiny, VetCBD To the Financial Institution Providing Us Banking Services Embarc’s business model is predicated on being a committed community partner that serves as a model business that the community can stand behind. Embarc prioritizes transparency, accountability and integrity in all that they do. This is vital for us in providing banking services in such as nascent industry, and it is vital for the communities, landlords and non-profit organizations that they partner with to execute their vision. Robert Starkey, Salal Credit Union It is this demonstrated track record that we seek to bring to the City of Fresno. SECTION 7.1 The CCB Application should describe the social responsibility plan. This should include all benefits the CCB has provided or plans to provide to the local community, for example by directly aiding, participating in, or funding the work of local non-profits, community-based organizations, civic organizations, or social services organizations. Benefits may be in the form of volunteer services, monetary donations, financial support of City- sponsored activities or organizations, in-kind donations to the City or other charitable organizations and/or any other economic incentives to the City. Embarc’s social responsibility plan is intended to be a living, breathing document that encompasses the company’s core values and informs our priorities for ongoing community engagement. It will continue to evolve over time through collaboration with our Community Advisory Board, a group of active local residents and community leaders working to shape Embarc’s community benefits and investments to best meet local needs. Given spatial constraints, our community efforts have been summarized rather than fully detailed below. The Community Advisory Board Embarc’s social responsibility plan is centered around its creation of a local Community Advisory Board to direct all community benefits and investments in perpetuity. It is hard to find a team with a stronger track record of providing resources to the local community by directly aiding, participating in, and funding the work of local non- profits, community-based organizations, civic organizations and social services organizations than this team. Embarc was the first cannabis operator to implement a Community Advisory Board in each community where it operates wherein the Board has total control over Embarc’s community investment. This is 183 critical given the significant relevant expertise and track records of community service embodied in our Board. Embarc Community Advisory BoardEmbarc Community Advisory Board Steve HoseySteve Hosey Chair, Community Advisory Board Chair, Community Advisory Board Lucy RuizLucy Ruiz Executive Director of Public and Legislative Relations, State Center Executive Director of Public and Legislative Relations, State Center Community College DistrictCommunity College District Elizabeth Jonasson RosasElizabeth Jonasson Rosas Board Trustee, Fresno Unified School District Board Trustee, Fresno Unified School District Strategy and Communications Officer, Fresno Economic Opportunities Strategy and Communications Officer, Fresno Economic Opportunities CommissionCommission David BouttavongDavid Bouttavong Program Manager, Equality California Program Manager, Equality California Chuck RiojasChuck Riojas Executive Director, Fresno, Madera, Tulare, Kings Building Trades CouncilExecutive Director, Fresno, Madera, Tulare, Kings Building Trades Council Scott MillerScott Miller CEO, Gazebo Gardens Inc.CEO, Gazebo Gardens Inc. Ryan TownsendRyan Townsend Executive Director, Central Valley Justice CoalitionExecutive Director, Central Valley Justice Coalition David RodriguezDavid Rodriguez Pinedale Community AssociationPinedale Community Association Dr. Carole GoldsmithDr. Carole Goldsmith President, Fresno City College President, Fresno City College Steve Hosey: Steve has dedicated much of his life to youth engagement, whether through engaging children in sports or his career with Family Leadership Inc., a non-profit organization dedicated to empowering families through transformational parenting and leadership skills that equip them to become vital contributors to their children’s academic success. In his capacity as Director of Family-School Partnerships, Steve develops meaningful relationships with educational institutions and parents to provide them with educational tools and ongoing training to become better parents, thus improving the lives and trajectories of their children. As someone who has spent decades mentoring youth through baseball, Steve has a track record of incubation, taking kids who are not achieving their full potential and utilizing the sport as an opportunity to provide structure and mentorship. Given his significant experience in the development and implementation of curriculum designed to benefit youth, Steve is a vital partner in Embarc’s efforts to deploy a local youth drug education and prevention program in Fresno. Given his efforts to engage and mentor young people via sports, he is also a critical component of Embarc’s social equity incubation and apprenticeship efforts. Lucy Ruiz: Lucy has widespread understanding of community challenges and the diverse populations of the Central Valley. She is an educational advocate and community partner, having served as vice-chair of the Community Media Access Collaborative and board member for Arte Americas, The American Heart Association, Central California Hispanic Chamber of Commerce, Fresno West Coalition for Economic Development, and the League of Mexican American Women Mariposa program. She has also served on the advisory boards of the Ronald McDonald House, the UC Cooperative Extension and the Fresno Childhood Immunization Coalition. Lucy currently serves as Executive Director of Public and Legislative Relations for State Center Community College District. As advisor to the chancellor, she played a pivotal role in the passage of a facilities bond to facilitate the new campus in west Fresno. Lucy will play a similarly critical role in helping Embarc architect its ongoing employee education and training programs, helping the company to navigate part- nerships with local community college campuses to increase educational opportunity for employees and incubatees. Elizabeth Jonasson Rosas: Elizabeth previously worked as Revitalization Funding Coordinator and then Community Outreach Coordinator for the City of Fresno, as a Campaign and Outreach Associate for the Coalition for Clean Air, as an Information Officer for the San Joaquin Valley office of California High-Speed 184 Rail Authority, as a teacher at Fresno State. She is currently a Board Trustee for Fresno Unified School District and Strategy and Communications Officer for Fresno Economic Opportunities Commission. Elizabeth is active in numerous civic and professional organizations and is a Keynote Speaker for Parent Institute for Quality Education (PIQE), a volunteer teacher at Junior Achievement, an ambassador for Donate Life California and served as an Environment Grants Committee Member for the Fresno Regional Foundation for three years. Elizabeth is a passionate educator who invests in community infrastructure and empowerment. Given her significant relevant experience in teaching, and her role with Fresno Unified School District, Elizabeth will be a vital voice in navigating how we can engage local schools to inform the development of a youth education and prevention campaign. Given her role at Fresno Economic Opportunities Commission, she will also be a vital partner in Embarc’s social equity and community betterment efforts, focused on expungement clinics, wraparound services, one-on-one mentoring for incubatees, and on tackling community issues including human trafficking, housing and food insecurity. David Bouttavong: David is the program manager overseeing OUT Against Big Tobacco in the Central Valley for Equality California. Prior to joining Equality California, he worked as health educator at Planned Parenthood Mar Monte providing comprehensive sex education in the Fresno region. In 2011, he joined the Fresno Barrios Unidos team, a grass roots social and reproductive justice organization aimed at empowering youth and community through education, wellness and advocacy. Later, he became their health education program manager and responsible for implementing Fresno Unified School District’s comprehensive sex education. Given his diverse professional experiences, David brings a background in youth education and a focus on equitable public health. As such, he will be instrumental in shaping how our drug education and prevention campaign can effectively engage youth and will also ensure Embarc’s efforts to address key community issues and challenges are focused and impactful in Fresno. Chuck Riojas: Chuck is the Executive Director of the Fresno, Madera, Tulare, Kings Building Trades Council, whose mission is to improve the health, jobs, safety and economic conditions of the members of its affiliates, and all working men, women, and minors in the construction industry. Chuck also serves as a Board Member of the Fresno Regional Workforce Development Board, a group comprised of businesses, organized labor, education, community-based organizations, economic development, One-Stop partners, Board of Supervisors, City of Fresno and leaders/advocates for workforce development focused on addressing the workforce needs of the Fresno region. In both capacities, Chuck is a driving force in strong labor and employment practices, meaningful apprenticeship opportunities, and career pathways for diverse workers throughout Fresno. He brings this laser focus on strong labor and employment practices and meaningful workforce development to help shape Embarc’s labor, apprenticeship and incubation practices based on his decades of practical experience in these realms. Scott Miller: Scott Miller has been a driving force and dedicated voice on business issues in Fresno for decades. Scott Miller is the CEO of Gazebo Gardens Inc., a local business known for its community-orientation and involvement. Community service in Fresno is central to Scott’s life; he sits on several community boards and committees and was honored to serve as the 2012 Chairman of the Fresno Chamber of Commerce. Scott has also been active in the chamber’s various programs —he was founding director of the Junior Board, a nine- month program which promotes civic activity to high school students, and a founder of the Small Business University program, which offers business and advocacy seminars for small businesses. Among his many notable accomplishments in the Fresno community is his role as one of a handful of residents that worked to save Storyland, overseeing everything from fundraising to construction to maintenance. Given Scott’s significant local small business expertise and decades-long track record of business advocacy, Scott will be instrumental in shaping Embarc’s social equity business mentorship and curriculum as part of the apprenticeship and incubation programs. 185 Ryan Townsend: Born to missionary parents, Ryan Townsend grew up overseas, often witnessing extreme poverty in cities and villages around the world. He returned to the Fresno area and graduated from Clovis West High School. In his late teens and early 20s, Ryan gradually became aware that injustice was routinely met with indifference from the general public. This realization fueled a lifelong mission of fighting for the poor and led to volunteer advocacy work with World Vision, The ONE Campaign, CASA, Freedom From Hunger, and No More Slumlords. Ryan is currently involved in leading public awareness for the Central Valley Freedom Coalition which includes nearly every agency involved in Central Valley anti-human trafficking work and a co-founder of Pledge 2 Stop Trafficking, a collaborative project organized alongside Central Valley Community Foundation. He is Executive Director of the Central Valley Justice Coalition and also served on the Data and Networking Committee of the Mayor’s Initiative to Combat Human Trafficking in Fresno. Given his signifi- cant focus on combatting human trafficking, Ryan will provide guidance on Embarc’s efforts to provide community benefit targeted at trafficking and human rights. David Rodriguez: David was born in Pinedale and has been integral to the fabric of the Pinedale community for decades, serving as a leader in the Pinedale Community Association and as a historian for this longstanding community. David runs the Pinedale History Project, an effort to preserve and promote Pinedale’s heritage. The Pinedale Community Association is a backbone of the local community, providing information, support and engagement for residents. Given David’s passion for this community and his role as a driving force in unifying community members on priority issues, he will bring invaluable knowledge of how to make tangible local impacts. Carole Goldsmith: Dr. Goldsmith has been recognized nationally as an expert on workforce development, contextualized learning, and career technical education. Before taking the helm as President of Fresno City College, Dr. Goldsmith served as President of West Hills College Coalinga for nearly four years, and before that she held the office of Vice Chancellor of Educational Services and Workforce Development at West Hills for four years. She started her career of service as a K-12 teacher at a small rural school, then as an administrator at an Adult School and at a private post-secondary college. Dr. Goldsmith still visits the classroom as an adjunct professor at the university level. Dr. Goldsmith has extensive expertise in building collaboration among faculty and industry, workforce investment boards and postsecondary educational agencies in order to identify and provide opportunities for students to gain the necessary skills and knowledge for future employment in high demand fields. Dr. Goldsmith brings this extensive experience in workforce development and career technical education to Embarc’s efforts in Fresno. Other Opportunities: Additionally, given our partnership with these organizations in other communities, Embarc has provided proposals to the Boys and Girls Club of Fresno County and the Fresno Police Activities League detailing ways in which they could participate on the Board and/or receive funding to benefit their respective youth engagement efforts. While these conversations are in preliminary stages, we remain hopeful that these organizations could also be insightful participants in the development of youth drug education and prevention efforts. The Community Advisory Board is comprised of leaders with diverse backgrounds and experiences in order to ensure residents, business owners, stakeholders and the community at large have an integral voice in our operations. Having a voice in shaping the company’s community-oriented approach to cannabis is about more than directing community funding. The Community Advisory Board is also asked to make recommendations regarding other key components of the business to ensure thoughtful, community sensitive operations, including: • Development and implementation of the community relations plan • Identifying and/or creating opportunities to enhance and promote community input, engagement, education and awareness 186 •Reviewing policies and procedures to identify community and neighborhood engagement opportunities •Building community trust through identification of community priorities, values and needs •Assessing opportunities for, and determining the best allocation of, community funding •Identifying opportunities for collaboration with local businesses and stakeholders •Providing input on planned education and awareness programs •Reviewing marketing plans and advertisements to ensure appropriateness Given it is comprised of leaders reflecting local non-profits, community-based organizations, civic organiza- tions and social services organizations, the Board is equipped to make determinations regarding how Embarc executes its social responsibility plan. Specifically, the Community Advisory Board ultimately decides: 1. Embarc’s funding priorities, including recipients and amounts 2. Embarc’s volunteerism (detailed in Section 2) 3. Embarc’s workforce development (detailed in Section 2) 4. Embarc’s financial support of City-sponsored activities 5. Embarc’s donations and/or economic incentives to the City 6. As detailed extensively in Section 2, the Community Advisory Board will also play a vital role in shaping Embarc’s apprenticeship and social equity incubation programs. Community Investment Fund The Community Advisory Board is able to make a sizable local impact because of our commitment to the creation of an internal Community Investment Fund. In addition to providing 4% of gross receipts to the City of Fresno and 1% of gross receipts to the City’s Community Reinvestment Fund (see Section 7.3 below), Embarc will allocate an additional 1% of gross receipts to our internal Community Investment Fund, generating significant, ongoing funding for community organizations through the efforts and allocations of our Community Advisory Board. One hundred percent (100%) of these funds will be allocated by the Community Advisory Board to local organizations and partners, ensuring that we prevent divestment by requiring all of the benefits generated from operating a local business to remain local. As detailed below, priorities for this funding include a sustained youth drug education and prevention campaign and holistic approaches to addressing pervasive community issues. In conversations with myriad local stakeholders, it is clear that preventing and combatting human trafficking is a tremendous priority city-wide, but with an emphasis on addressing acute needs within District 7. As such, Embarc is committed to dedicating significant financial and human resources to bolstering the efforts of the Central Valley Justice Coalition, an organization dedicated to preventing human trafficking through partner- ship, education and outreach. 1. Addressing human trafficking Every year, human traffickers generate billions of dollars by victimizing millions of people around the world, including in the United States. Human trafficking is considered to be one of the fastest growing criminal industries worldwide, ensnarling minors and adults in modern-day slavery. Through ongoing funding, Embarc will support the efforts of Community Advisory Board member Ryan Townsend, who leads the Central Valley Justice Coalition and is heavily involved in the Central Valley Freedom Coalition and Pledge 2 Stop Trafficking. This support will be directly targeted to: • Generating awareness • Training on combatting and preventing trafficking • Technical assistance • Advocacy • Direct services regarding human trafficking and trafficking-related issues 187 2. Neighborhood beautification Embarc will engage in ongoing neighborhood beautification efforts in priority areas of the District as identified by our Community Advisory Board and the community at large. As part of our paid volun- teerism program our employees will commit to community cleanups no less than once a month. This volunteerism will also include the creation of a ‘Street Team’ focused specifically on organizing and implementing ongoing revitalization efforts to enhance and/or maintain a positive quality of life, ensure only positive impacts on the neighborhood. This is also a net benefit for the business, as it further connects our employees to the community they serve. 3. Address gun violence Community conversations reveal that, much like human trafficking, gun violence on Fresno’s streets is a City-wide issue. Members of Embarc’s team have been actively engaged in reducing gun violence in communities throughout California, including sponsoring gun buybacks in the Bay Area that have resulted in hundreds of guns being taken off the streets. In an October 2020 peace rally, it was revealed that the City of Fresno had experienced 289 more shootings and 50 more murders than it had by that date in 2019. Given the importance of addressing gun violence, and our team’s track record on this issue elsewhere, Embarc seeks to support these efforts in every way possible in Fresno. We will allocate at least annually to local organizations working to reduce gun violence on Fresno’s streets. A Note on Prioritization: Embarc recognizes that a community’s needs and priorities shift over time – some- times gradually and sometimes rapidly in the face of obstacles such as COVID-19, which has dramatically impacted focuses for communities across the globe. That is why it is so critical for Embarc’s focus areas to be driven by our Community Advisory Board, who live and work in this community and are vital resources in determining prioritization. Contemplating our 4% tax payments, 1% of gross receipts for the Fresno Community Reinvestment Fund (see Section 7.3 below), 1% of gross receipts to our internal Community Investment Fund, and one-time payment to initiate the education campaign (see Section 7.2 below), the total value of committed financial public benefit associated with this proposal is as follows: 188 Additional Components In addition to the plan tailored specifically to the Fresno community, Embarc will implement the following customary corporate social responsibility components expected of all community-oriented cannabis businesses. • Community Education In addition to education targeting parents and guardians regarding how to engage in discussions regarding drug use with youth, we will also host monthly educational panels, informational workshops and non-profit partnership events as part of an ongoing community education and engagement effort. Education is critical in demystifying cannabis and breaking down the barriers and stigma that prevent many from feeling comfortable asking questions about appropriate use and making this approachable is critical to ensuring positive impact. Given COVID-19, we will also offer educational discussions via Zoom or other video conferencing platform to facilitate remote participation. • Senior Outreach Seniors are one of the fastest growing consumer demographics for cannabis but they are also the most likely to be susceptible to cannabis’ long-lasting stigma. Therefore it is important to create an atmo- sphere that makes seniors in the community feel as though they are a part of, and welcome at, Embarc. Employing seniors within the store and as our Seniors Outreach and Educational Advisor are critical in breaking down that barrier. In recognition of the tremendous medical benefits cannabis can provide this demographic, Embarc is committed to ongoing education and engagement with Fresno’s senior community to dispel the myths, eliminate the stigma and provide education (without a sales pitch) to help seniors navigate this new normal. We will explore opportunities to partner with senior citizens’ groups and organizations to provide monthly free education workshops on CBD, THC, medical cannabis, dosing, and more, led by our Seniors Outreach and Educational Advisor and members of our team who are over the age of 50. Topics will include cannabis basics, cannabis and pain, cannabis and sleep, and more. In recognition of fixed incomes, we will also provide a discount to senior citizens. • Creation of a Cannabis Subcommittee at the Chamber of Commerce or a Local Cannabis Industry Association When implementing a new industry—and particularly when that industry is cannabis—we believe the community will benefit from having unified businesses that work together to achieve common, community-oriented goals. While we did not think it was prudent to do so prior to be awarded a permit and coordinating with other license recipients, Embarc will gladly undertake an effort to coalesce the local cannabis industry under a common umbrella, either through a subcommittee at the Chamber of Commerce or via an independent local Cannabis Industry Association. By bringing a representative 189 from each legal cannabis business to the table, we can facilitate ongoing working relationships and positive collaboration among the legal and compliant cannabis operators. This could also provide a representative from the City the opportunity to engage with a singular, unified voice for the industry through participation as part of this effort. • Scholarship Program As detailed in Section 2, Embarc supports equity scholarship programs and scholarships for underrep- resented groups and will continue this track record in Fresno. In South Lake Tahoe, Embarc provides scholarships through the Lake Tahoe Community College for LGBTQIA+ students and for the equity food bank, which feeds students meeting certain household income requirements. • Financial Literacy Community Workshops We will offer financial literacy workshops for the general public, providing access to seasoned financial executives that can assist low-income community members with issues such as budgeting, money management and building and repairing credit. This workshop leverages the financial literacy curricu- lum developed by the National Financial Educators Council, a proven model. We will seek to sponsor these with our community partners, providing this as a resource to their networks as well. • Local Business Partnerships Embarc will do its part to support working families by keeping dollars local, thereby growing the Fresno economy. This support drives local tax revenues which in turn supports our tax base and vital local services. It is our intention to obtain goods and retain services from locally licensed small businesses, including but not limited to those listed below. Chamber of Commerce membership will provide a great network of local business contacts for these and other vital components of keeping our dollars local. • Construction services • Landscaping services • Maintenance and janitorial services • Ongoing IT services • Security services • Misc. professional services • Local artisan goods and products • Most importantly—our employees In addition to hiring local employees, partnering with local vendors and relying on local goods and services, Embarc will also create meaningful partnerships with local businesses to cross promote and market their goods and services. Such opportunities span a variety of businesses, ranging from health and wellness (yoga instruction, outdoor gear, etc.) to restaurants, coffee shops, and entertainment. By solidifying promotional partnerships, our operations can help to drive additional customers to these businesses. These partnerships are not just promises made but actual mandates we implement at the store level. In order for any Purchase Order or Service Contract to be approved, the General Manager must check a box that the contractor or vendor is based in Fresno County. If they are proposing to use a non-local service provider, they must explain the reasoning for why they have selected an entity from outside the County to seek approval. • Compassionate Use Cannabis is recognized as an important medical treatment option for many medical conditions ranging from seizures, to PTSD, to cancer. To help meet the medical needs of some patients who are otherwise unable to afford cannabis, Embarc will offer reduced and no-cost medicine to low income and seriously ill patients as well as provide the support these patients need to maneuver the health impacts and side effects of their illnesses and medical regimens. This program will be operated in accordance with regulations set forth by the Bureau of Cannabis Control. Patients who want to receive benefits from this program must provide evidence of residency and medical and financial need. We believe patients should 190 have access to affordable medicine that benefits their health and quality of life. We are proud to offer a compassionate use program providing low-cost and no cost medicine. • Discount Programs High quality cannabis should be accessible rather than exclusive. As such, Embarc maintains a variety of discount programs intended to benefit a variety of communities, including seniors, veterans and local residents. Additionally, to encourage customers to shop during non-peak hours and mitigate traffic and customer flow impacts, Embarc often offers incentives for online order pick-up or off-hours shopping. • Addiction Resources We understand that often admitting to needing help is the hardest step, and as such we must be prepared to provide relevant resources to anyone who is willing to ask for such help. Embarc will partner with local community health organizations to make resources available regarding addiction recovery and will maintain materials onsite for such requests. 7.1.1 Providing funding for or hosting expungement clinics or outreach services. History has proven that inequitable enforcement of drug policies has been wielded as a tool to criminalize low-income communities and communities of color by creating a generational cycle of disenfranchisement and imprisonment. The War on Drugs has left a legacy in communities that continues to plague the victims of cannabis criminalization and future generations, driving inequalities that can have lifelong consequences. We recognize that it is a privilege to operate a business in this industry and to maintain our freedom and opportunity while doing so. As a company that benefits from this privilege, we have a duty to continuously recognize and seek to address the impacts of the War on Drugs, hoping that through meaningful participation we can collectively work toward a more equitable future. We are proud of our commitment to social equity as a core tenant of our company—it is woven into the fabric of our team’s collective efforts. This commitment to social equity, particularly in recognizing and seeking to address the impacts of the War on Drugs, began half a decade ago when Chief Compliance Officer Dustin Moore was engaged to assist in the drafting and passage of Proposition 64. Proposition 64 represents one of the largest systematic efforts in history to address the wrongs of the War on Drugs on low-income communities and communities of color. The measure was co-authored by the Drug Policy Alliance, an organization seeking to promote new drug policy grounded in science, compassion, health, and human rights. Proposition 64 enacted meaningful sentencing reform to expunge records for cannabis offenses and to provide significant funding for communities most harmed. This funding has already resulted in nearly in local grant disbursements to date and is on track to issue more than by 2023. These grants have supported job placement, mental health treatment, system navigation services and legal services to address barriers to re-entry in communities throughout California. As such, Embarc’s commitment to ongoing hosting of, and funding for, expungement clinics in Fresno is not simply a promise made for this application. Rather, it is the result of our team’s efforts to create the infrastructure necessary in order to facilitate the very ability for these expungements to occur via our efforts on Proposition 64. Thus, our local expungement efforts are simply an extension of the work we have undertaken on this issue for years, and one we are proud to see implemented throughout California. 191 • Embarc will commit to hosting no fewer than four (4) expungement clinics within one year of being awarded a license to operate in the City of Fresno •Embarc will also commit to ongoing funding to expunge the records of social equity incubatees that participate in the proposed F.E.E.D. social equity incubation campus •Embarc’s expungement efforts will be undertaken in partnership with Elizabeth Jonasson Rosas of the Fresno Economic Opportunities Commission, which will assist in facilitating these expungements and will partner with Embarc to simultaneously offer wraparound services for those seeking expungement 7.1.2 Incorporating an environmentally sustainable business model including energy efficient buildings and vehicles. The importance of wellness does not stop with our patients and customers but extends throughout our entire business model, including how we impact our most precious resource —the environment. Embarc strives to be thoughtful in design and operations to reflect an ongoing commitment to sustainability. Embarc has a robust sustainability plan that governs its construction and day-to-day operations. This plan encapsulates our efforts to ensure the business’ sustainability, including but not limited to a description of energy generation and efficiency measures, high efficiency mechanical systems, and alternative fuel transpor- tation methods. Execution of this plan is overseen by Terri Gilles, Embarc’s Chief Operating Officer. Terri is a L.E.E.D. accredited professional. Key components of our plan for energy efficient buildings, operations and vehicles have been briefly summa- rized below. Given spatial constraints, this response is not intended to be exhaustive of our efforts. Provide education and outreach highlighting the benefits of energy conservation: •As a local business, Embarc is committed to promoting Fresno’s values and will work with City staff to develop sustainability materials that can be shared with customers. •Embarc will have a “green building awareness program” to educate and encourage homeowners and businesses to use green building techniques. Reduce urban heat islands through vegetation management and cool surfaces: •As part of our plans to upgrade our site location(s), Embarc will consult with a local arborist to identify an appropriate shade canopy that will help reduce heat islands and contribute to property beautification. •For all surface repaving, Embarc will use solar reflective “cool” pavements, which stay cooler in the sun than traditional pavements. •When existing infrastructure is replaced, Embarc will use cool roof materials on new and existing buildings to reduce the urban heat island effect and corresponding cooling energy consumption. •Embarc will develop and implement site specific sustainable landscaping standards to reduce urban heat islands and utilize compost and mulch in landscaping as a water conservation measure. Promote installation of alternative energy: •Embarc is committed to renewable energy generation and will use solar energy for at least some of its power. As we evaluate the feasibility of offering EV charging stations, we will also evaluate the possibility of onsite energy storage. •As part of our consumer awareness program, Embarc will provide information to consumers about savings programs and incentives for residential solar installation. Save energy used for public lighting: •Exterior lighting will be replaced with light-emitting diodes (LEDs). •When appropriate and not impactful to security measures, Embarc will use “de-lamping” techniques to reduce lighting levels on the exterior and the parking lots. 192 Conserve water: •All new equipment will be the best available technology for water efficiency and Embarc will outfit using low-flow restrictors on all faucets. •Embarc will reduce water usage on our landscaping through a variety of water conservation techniques including landscape material selection and design. •While we will install conventional storm water management techniques, which typically convey and store runoff in large centralized facilities located at the base of drainage areas, as we redevelop property we will use LID design strategies to control stormwater at the source through the use of an integrated system of small scale controls distributed around the site (EPA, 2000). These small-scale controls can be integrated into the existing landscape relatively easily, including vegetated or landscaped areas, parking lots, buildings, and streets (Coffman, 2002). Reduce waste: •Embarc has implemented a waste reduction strategy to increase recycling and reuse of materials, except in cases where waste management (such as cannabis waste) is strictly governed by specific regulations. •Embarc encourages vendors to reduce the use of styrofoam and/or plastics and increase composting of materials. •Embarc encourages the reduction of vehicle miles traveled by incentivizing consumers to ride bicycles and utilize public transportation. Incentives can include product discounts and free transportation vouchers. •Pursuant to Section 5413 (b) Title 16 of California Code of Regulations, all packaging must be reseal- able, tamper-evident and child resistant. While these requirements limit the products on the market that are recyclable, Embarc has been working with our distributor, Herbl Solutions, to identify vendors that provide sustainably packaged products. Furthermore, we will use our purchasing power to encourage vendors to adopt sustainable packaging. Promote energy saving tools and practices: •Embarc will prioritize improvements and facilities upgrade that save energy and develop policies related to powering off lights and appliances after hours. •Embarc designs spaces with smart thermostats that not only ensure thermal comfort but also allow us to control air temperature after-hours to reduce energy use. •Lighting systems off the retail floor area are on occupancy sensors, while our retail floor is on a timer to ensure lights are not left on when the building is not occupied. Provide alternative water resources for irrigation in residential and nonresidential areas: •Embarc will implement rainwater collection for irrigation purposes and change our landscaping to d rought reduction vegetation. Provide opportunities to grow, sell, and purchase local: •Embarc will form partnerships with the other cannabis licensees in the City to source local products for our store and will provide them with premium shelf space to encourage purchasing local. Maintain and expand access to goods, services, and other destinations through increased transportation alternatives: • Embarc’s location(s) are all within 500 feet of a public transit station. •Embarc will be providing bike racks to encourage other modes of transportation. Encourage employees and customers to utilize alternative means of transportation: • Embarc will provide bike racks within 200 ft of the retail premises for employee and customer use. •Embarc will provide pretax benefit for bus or metro cards for employees to get to and from work. •Embarc will provide discounts to customers who show proof of riding a bike or using public transpor- tation to get to the retail location. 193 • Embarc will partner with a local bike shop for discounts for our employees to purchase and maintain their bicycles if they are their standard means of transportation. Expand the use of alternative fuels in vehicle travel: • Embarc will use zero emission vehicles for all deliveries. • Embarc will encourage our employees to adopt this technology for their personal vehicles by providing information on available state and federal incentives. Implement innovative sustainability solutions: • Innovation by design is a key component of thoughtful sustainability solutions. We have identified a number of opportunities for highly innovative opportunities to increase sustainability, including: • Biofiltration: A NASA Clean Air Study identified biofiltration as a powerful tool in controlling odors. Through use of certain plants, we are able to filter pollutants and odors from the air. This is a completely sustainable —and beautiful —way of addressing odor control. By utilizing Naava living walls, we can leverage plants and beneficial microbes to help purify the indoor air. • Building Materials: We will work with our construction team to identify building materials that are sustainable. For example, 3% of the world’s emissions come from the production of concrete, so we will work with companies like Blue Planet, which develops carbon neutral concrete products. Additionally, we will only utilize sustainable wood products and will avoid finish materials that are not sustainable. • Tesla Solar Wall: We will install a Tesla solar wall to maximize the efficiency of our solar panels. The solar wall allows for storage of solar energy so it can be allocated day or night. • To minimize the footprint of the HVAC system, we will utilize Quiet Duct Wrap. It is made from recycled denim fabric that has been diverted from a landfill and has an aluminum barrier that provides protection from air currents, moisture and vapors and reflects unwanted radiant heat. • Energy Star Partner: We will only utilize appliances and fixtures that Energy Star certified to ensure energy efficient equipment. As demonstrated, we are committed to implementing innovative sustainability measures and will always be looking for additional ways to be the most sustainable commercial cannabis business in Fresno. Additionally, Embarc plans to fulfill all deliveries through a fleet of zero emission vehicles. This fits our overall company goal of striving to have a net zero impact on our environment. • Use zero emission vehicles for cannabis deliveries • Work with electric utility and City of Fresno to develop and implement electric vehicle charging infrastructure for our fleet vehicles and our customers Some believe sustainability is too costly when compared to traditional methods and materials, but we believe it is an investment in the future. 7.1.3 Utilizing vacant buildings, brownfields land, or blighted areas of the city for the business. Embarc has a proven track record of significant site improvements. For example, in Tahoe, we took a small building that floods every year and turned it into an approachable, inviting retail space: 194 Embarc Tahoe: Exterior Embarc Tahoe: Interior Before After Embarc’s proposed locations are either vacant, soon-to-be vacant or on vacant land. In every proposed location, Embarc’s presence will thus positively benefit the neighborhood, both through the development, improvement and/or maintenance of the property and through ongoing execution of our Good Neighbor Policy. Embarc’s proposed location is currently vacant. In speaking with building ownership, we are proud to report that we will be utilizing a vacant building that would likely remain vacant for quite some time given the current economic climate where brick and mortar retail real estate is suffering significantly. SECTION 7.2 Describe the Commercial Cannabis Business plan to develop a public health outreach and educational program that outlines the risks of youth use of cannabis and that identifies resources available to youth related to drugs and drug addiction. Embarc is committed to the execution of a thoughtful, community-oriented youth education and drug preven- tion program developed in partnership with our Community Advisory Board, many of whom have advocated on behalf of Fresno’s youth for decades. Our experience has taught us that the best youth prevention plan in the world is meaningless without community buy in. As such, we are proud to be partnering with the strong community voices represented on our Community Advisory Board to develop a youth education and prevention program designed and implemented by this community for this community. While we are prepared to undertake the development of this campaign as further detailed below, we also recog- nize that fourteen disparate approaches to a youth education and drug prevention campaign may unintentionally compete with one another and undermine collective success. As such, we are happy to undertake our proposed campaign alone, or in partnership with any or all of the other retail applicants. We believe that by working together, all applicants can combine resources and engagement to achieve a significant, scalable education program that achieves the goal of deterring youth drug use. To that end, Embarc is prepared to provide a one-time payment of per awarded license, resulting in up to in total payments, to the City of Fresno or its desired community partner for the purposes of seeding the development of this campaign. Below please find a brief overview of Embarc’s intended efforts in Fresno. Program Overview The National Institute on Drug Abuse developed A Research Based Guide for Parents, Educators, and Community Leaders for Preventing Drug Use in Children and Adolescents , an internationally recognized analysis of how to develop and implement effective youth drug prevention campaigns. This comprehensive guide contains significant science-based research to guide the development and implementation of effective youth education and drug prevention efforts, including the following, and serves as the foundation for Embarc’s proposed program: 195 • Prevention programs should be tailored to address risks specific to population or audience characteris- tics, such as age, gender, and ethnicity, to improve program effectiveness (Oetting et al. 1997). • Prevention programs aimed at general populations at key transition points, such as the transition to middle school, can produce beneficial effects even among high-risk families and children. Such interventions do not single out risk populations and, therefore, reduce labeling and promote bonding to school and community (Botvin et al. 1995; Dishion et al. 2002). • Community prevention programs reaching populations in multiple settings—for example, schools, clubs, faith-based organizations, and the media—are most effective when they present consistent, community-wide messages in each setting (Chou et al. 1998). • Community prevention programs that combine two or more effective programs, such as family-based and school-based programs, can be more effective than a single program alone (Battistich et al. 1997). • Prevention programs are most effective when they employ interactive techniques, such as peer discussion groups and parent role-playing, that allow for active involvement in learning about drug abuse and reinforcing skills (Botvin et al. 1995). • Prevention programs should include teacher training on good classroom management practices, such as rewarding appropriate student behavior. Such techniques help to foster students’ positive behavior, achievement, academic motivation, and school bonding (Ialongo et al. 2001). • When communities adapt programs to match their needs, community norms, or differing cultural requirements, they should retain core elements of the original research-based intervention (Spoth et al. 2002b), which include: • Structure (how the program is organized and constructed); • Content (the information, skills, and strategies of the program); and • Delivery (how the program is adapted, implemented, and evaluated). Based on this significant body of research, it is clear that the most effective program: • Targets youth with age-appropriate content at various stages in their maturation; • Utilizes multiple learning formats including interactive content; • Involves multiple parties including teachers, parents, faith-based organizations and more to provide multiple access points for information; and • Benefits from hyper-localism, as long as the program remains rooted in structure, content and delivery. As such, our campaign is designed with these best practices in mind. Structure Research has proven that the most effective youth education and drug prevention programs utilize two or more effective programs rather than any single program alone. For example, an effective school-based curriculum is more successful when coupled with at-home and technological components. Thus, Embarc will implement a multicomponent program that takes a holistic approach to youth engagement: • Paid media campaigns with general anti-drug education messaging targeted to all youth • Digital coursework and media campaigns targeted to middle and high school students • Educational programming for use as an in-school program, with a toolkit for teachers and/or a program coordinator • Educational resources for parents and guardians, faith-based communities, youth activities leaders (such as coaches) and the community at large Creating a multicomponent program will ensure that youth education and prevention efforts engage youth across multiple channels, in many forums, and on a consistent basis to maximize efficacy. 196 Content Our Community Advisory Board members have committed to working collaboratively to implement this effort for Fresno youth. In each of our discussions with these individuals to date, one thing has become abundantly clear: the D.A.R.E. campaign is viewed as antiquated and misaligned with the needs and realities of educating today’s youth. By utilizing the State’s innovative “Let’s Talk” campaign as the starting point for our content development, we can leverage the best science available while tailoring our program specifically to Fresno. We are committed to funding the execution of a more modern, community-sensitive program to achieve these goals. Per the National Institute on Drug Abuse, content includes the information, skills development and methods of a drug prevention program. • Information: While science-based facts and data are critical components of this program, it cannot utilize data alone. The most effective programs also utilize skills development and dynamic methods to increase efficacy. • Skills development: While learning about the dangers of drugs is paramount to an education campaign, it must be bolstered by skills-based training such as communication, interpersonal skills, and self-confi- dence in decision making. This must also include modules for parents/guardians and other adults that play important roles in the lives of youth to support the development of these vital skills throughout childhood. •Methods: Methods center around the mechanisms by which the program will be implemented and measured. These include, but will not be limited to: • Paid media (billboards, digital ads, social media ads) • Earned media • In-school curriculum • Online modules • Peer-to-peer engagement exercises • Resources for adults (parents/guardians, teachers, coaches, pastors, etc.) Modes of Delivery Per the National Institute on Drug Abuse, effective program delivery must contemplate program selection and implementation: • Program Selection When our team members led the development of Proposition 64, the initiative to legalize adult use cannabis in California, they knew youth prevention and education were paramount to maximizing public health and safety within communities. As such, and with intentionality, our team ensured that Proposition 64 would provide the resources and direction necessary to educate youth on the risks associated with cannabis use. Proposition 64 included the development of a state-sponsored educational campaign, entitled “Let’s Talk.” This campaign has developed curriculum specifically targeted to communities, parents, and youth. We will use this program, developed with a science-based approach by some of the brightest minds in California, as the foundation for our Fresno-specific curriculum. However, we will continue to refine the program and will work closely with the Department of Public Health, our Community Advisory Board and local electeds to ensure this program is the best fit for the Fresno community. • Utilize the “Let’s Talk” campaign that members of our team helped to develop • Refine our existing material with science and data-based curriculum that outlines the risks of youth addiction to cannabis • Provide resources to combat youth drug addiction • Provide substantial volunteer efforts to implement this program 197 Cannabis Affects Your Health • Like cigarettes, smoking cannabis is harmful to your lungs. The smoke from cannabis has many of the same toxins and chemicals found in cigarette smoke, and when inhaled it can increase your risk of developing lung problems.1,2 • The way cannabis is grown has changed and some plants now have higher levels of THC. High levels of THC can lead to poisoning, especially with edibles like cookies.3,4,5 • Regular cannabis use has been linked to anxiety, depression, and suicide, especially for teens with a family history of mental illness.6,7,8 • Cannabis use increases the risk of schizophrenia, although it is not common. The more cannabis you use, the higher the risk.9 • Using cannabis as a teen can lead to cannabis dependence and increase your risk for using or abusing other substances and illegal drugs.10,11 Cannabis Affects Your Brain • Your brain is still developing. Using cannabis regularly in your teens and early 20s may lead to physical changes in your brain.12 • Research shows that when you use cannabis your memory, learning, and attention are harmed. Some studies suggest a permanent impact as well.13 Most Teens Are Not Using Cannabis • In 2016, most high school students in California reported they were not using cannabis. Only about 15 percent (less than 1 in 5) reported using cannabis in the past 30 days.14 Cannabis Impacts Your Goals • The harmful effects of cannabis on your brain may impact your educational and professional goals and how successful you are in life.15 Research shows that if you start using cannabis before you are 18 or use cannabis regularly you may be at higher risk for: − Skipping classes 16 − Getting lower grades 11 − Dropping out of school 17 − Unemployment or not getting the job that you’d like to have 17,18 Cannabis Affects Your Driving • Cannabis can negatively affect the skills you need to drive safely, including reaction time, Cannabis (marijuana, weed, pot, etc.) may affect your educational and professional goals and how successful you are in life. Because your health and future are important to you, here are some things you should learn about how cannabis use influences your body and brain. Youth and Cannabis Last Update October 17, 2017 Under California law, adults 21 or older can use, carry, and grow cannabis (marijuana, weed, pot, etc.). Buying cannabis (without a valid physician’s recommendation or a county-issued medical marijuana identification card) will become legal under California law for adults 21 or older on January 1, 2018. Use of medicinal cannabis is legal under California law if you have a valid physician’s recommendation or a valid county-issued medical marijuana identification card. To buy medicinal cannabis, you must be 18 or older and have either a valid physician’s recommendation, a valid county-issued medical marijuana identification card, or be a Primary Caregiver as defined in Health and Safety Code Section 11362.7(d) or 11362.5(e), with a valid physician’s recommendation for the patient. In addition, consistent with the Compassionate Use Act, you may possess or cultivate any amount that is reasonably related to your current medical needs. The new California law, known as the Medicinal and Adult-Use Cannabis Regulation and Safety Act21, includes information about where you can use cannabis, how much you can possess, and the penalties for illegal use. For more information, visit: https://leginfo.legislature.ca.gov/faces/billTextClient. xhtml?bill_id=201720180SB94. COUNTY / CITY NAME / LOGO California Cannabis Health Information Initiative Youth and Cannabis• However, most youth do not believe cannabis is harmful. Eight out of 10 youth in California, aged 12-17, reported believing using cannabis once a month was not risky.18 Tips for Encouraging Youth Not to Use Cannabis19 • Talk openly and provide guidance about the risks of using cannabis. –Youth who have supportive parents, teachers, and other adults are less likely to use cannabis and illegal drugs. –Stay positive. –Focus on how using cannabis can get in the way of achieving goals such as graduating high school, getting into college or getting a good job. Do not focus on negative outcomes. • Listen carefully to the questions and thoughts youth have. • Set shared guidelines and expectations for healthy behaviors. –Youth are less likely to use cannabis when parents set clear limits and house rules. • Be aware of your own attitudes and behaviors. –You are a role model. If you use cannabis in front of young people, they are more likely to use it too. Recognizing if a Youth is Using Cannabis20 • Look for behavioral changes related to cannabis use such as: mood swings, spending less time with friends, skipping school, loss of interest in sports or other favorite activities and changes in grades and sleeping habits. • Young people under the influence of cannabis may lack coordination, giggle for no reason, act silly, have red eyes and short-term memory loss. What to Do if a Youth is Using Cannabis19 • Stay calm. Overreacting may lead youth to rebel, feel resentment or take greater risks. • Talk about your concerns and give positive reasons for wanting youth to stop using cannabis. • Keep the conversation open for problem solving. • Remind youth of the ground rules you set earlier, or set new ground rules and consequences. • If needed, seek help from trusted adults and resources in your community. • Call 911 and get help if there is a medical or mental health emergency. California Cannabis Health Information Initiative What Parents and Mentors Need to Know about Cannabis Last Update October 17, 2017  http://bit.do/letstalkcannabis  letstalkcannabis@cdph.ca.gov Under California law, adults 21 or older can use, carry, and grow cannabis (marijuana, weed, pot, etc.). Buying cannabis (without a valid physician’s recommendation or a county-issued medical marijuana identification card) will become legal under California law for adults 21 or older on January 1, 2018. Use of medicinal cannabis is legal under California law if you have a valid physician’s recommendation or a valid county-issued medical marijuana identification card. To buy medicinal cannabis, you must be 18 or older and have either a valid physician’s recommendation, a valid county-issued medical marijuana identification card, or be a Primary Caregiver as defined in Health and Safety Code Section 11362.7(d) or 11362.5(e), with a valid physician’s recommendation for the patient. In addition, consistent with the Compassionate Use Act, you may possess or cultivate any amount that is reasonably related to your current medical needs. The new California law, known as the Medicinal and Adult-Use Cannabis Regulation and Safety Act21, includes information about where you can use cannabis, how much you can possess, and the penalties for illegal use. For more information, visit: https://leginfo.legislature.ca.gov/faces/billTextClient. xhtml?bill_id=201720180SB94. Cannabis Can Affect a Young Person’s Brain • The brains of young people do not fully develop until they reach their mid-20s. Regular cannabis use during the early years of life can lead to harmful physical changes in the brain.1 • Research shows that when youth use cannabis their memory, learning, and attention are harmed. Some studies suggest a permanent impact as well.2 Other Negative Effects of Cannabis on Youth • Driving under the influence of cannabis increases the risk of getting into a car crash. Cannabis can negatively affect the skills that are needed to drive safely, including reaction time, coordination, and concentration.3,4 • The harmful effects of cannabis on a young person’s brain may impact their educational and professional goals and how successful they are in life.5 Research shows that youth who start using before 18 or who use cannabis regularly may be at higher risk for: –Skipping classes6 – Getting lower grades 7 – Dropping out of school 8 – Unemployment or having less fulfilling jobs later in life8,9 • Mental health problems may include: –Anxiety, depression, suicide, and schizophrenia 10,11,12,13 –Cannabis dependence and a higher risk for using or abusing other substances and illegal drugs14 • Like tobacco, smoking cannabis is harmful to the lungs. The smoke from cannabis has many of the same toxins and chemicals found in tobacco smoke, and when inhaled can increase the risk of developing lung problems.15,16 Young People and Cannabis Use • In 2016, most high school students in California reported they were not using cannabis. Only about 15 percent (less than 1 in 5) reported using cannabis in the past 30 days.17 Parents and mentors can have an impact on whether or not youth use cannabis (marijuana, weed, pot, etc.). Pre-teens, teens and youth in their early 20s often seek out new experiences and engage in risky behaviors, such as using cannabis. You can help prevent underage use by starting the conversation about cannabis with youth in your life, and make sure they are aware of potential consequences. Here are some important facts you should know about cannabis and some tips for talking to youth. What Parents and Mentors Need to Know about Cannabis Last Update October 17, 2017 COUNTY / CITY NAME / LOGO California Cannabis Health Information Initiative What Parents and Mentors Need to Know about Cannabis • Program Implementation As stated above, we believe an effective youth education effort is predicated on development and imple- mentation by the community for the community. As such, we will finalize and implement this program with significant guidance and direction from key community leaders on our Community Advisory Board, and leading voices from the faith-based community, local non-profits and City representatives, as desired. We believe this is an opportunity to engage the School District, City of Fresno, and non-profit leaders in a holistic campaign targeted at youth, parents and the community-at-large and would provide grants to our partners for effective execution. It is critical that neither Embarc, nor any cannabis operator, be perceived as the “face” of this program, which is why our community partners and their existing networks are so important. • Once finalized, Embarc will then provide grants to our community partners for implementation of the program. • We would welcome the opportunity to partner on in-school implementation with the School District and other relevant stakeholders. Implementation of our education campaign will take a variety of forms —online given the current educational climate, in-person as youth are able to re-enter traditional classroom settings, and through education efforts also targeted at informing, educating and engaging parents/guardians and other vital adult stakeholders about how to navigate tough conversations with youth. Funding Embarc will fund the curriculum and ongoing education program in two ways: 1. First, through a one-time allocation of per license ( to seed program development; and 2. Next, through annual funding via our Community Investment Fund. 198 Implementation Timeline We propose the following timeline for program implementation: Date Deliverable May 2021 Anticipated Date for City Council Selection June 2021 First Community Advisory Board (CAB) Meeting • Detail objectives • Discuss curriculum • CAB feedback: Program goals Curriculum priorities Other partners July 2021 Embarc takes feedback from first meeting, develops full curriculum and implementa- tion timeline September 2021 Second Community Advisory Board (CAB) Meeting • Review full curriculum • Review implementation timeline • Discuss resource allocation • Discuss implementation partnerships • Approve next steps Oct —Nov 2021 Embarc takes feedback from second meeting; finalizes curriculum, initiates strategic partnerships to prepare for rollout December 2021 Embarc marketing team develops non-branded campaign assets for campaign use across paid media channels for approval by CAB January 2022 Third Community Advisory Board (CAB) Meeting • Review and approve campaign assets • Review and approve paid media budget • Review and approve partnership grants January 2022 Program Launch SECTION 7.3 Describe whether the Business plans to contribute to the Fresno Community Reinvestment Fund, established to support local canna- bis equity businesses. Embarc will provide 1% of gross receipts —not net profits —to the Fresno Community Reinvestment Fund established to support local cannabis equity businesses in perpetuity. Embarc will seek to have this commit- ment memorialized in a manner preferred by the City of Fresno including through a voluntary revenue sharing or public benefit agreement. Given our commitment to the social equity program in Fresno, we feel incredibly proud to be able to participate in this program. Conclusion Embarc has a demonstrated track record of meeting the unique needs and priorities of communities. As part of that ongoing effort, Embarc has coalesced many of the leading community voices from across Fresno into a Community Advisory Board, tasked with ensuring our local community benefits remain laser focused on the specific and distinct needs of the district. We have committed significant resources —both financial and human —to ongoing engagement and betterment of the community we seek to serve, resulting in tangible impacts for the City, neighborhoods, and residents. 199 SECTION 6. LOCATION SECTION 6.1 In addition to the location-related details provided in the Commercial Cannabis Business (CCB) Application (pages 1-7), the applica- tion shall include a thorough description of the proposed location, including but not limited to the overall property, building, and floor plan. The proposed location is at 4592 North Blackstone Avenue, Fresno, CA 93726. The APN is 428-010-15. Overall Property Description The lot contains an existing standalone building that is situated on approximately 15,681 square feet of land on the corner of Blackstone Avenue and Gettysburg Avenue. The parcel is neighbored to the South by Taqueria Don Pepe at 4582 North Blackstone Avenue and to the West by a parking lot affiliated with Ramos Furniture located at 4550 North Blackstone Avenue. This site fully complies with Section 9-3307 of the Fresno Municipal Code and: • Is located in the allowable CMX zoning designation • Is more than eight hundred (800) feet from a sensitive use • Conforms with the City’s general plan, any applicable specific plans, and design requirements • Complies with all zoning and related development standards • Is constructed in a manner that minimizes odors to surrounding uses, and promotes quality design and construction, and consistency with the surrounding properties • Has adequate electricity, sewer, disposal, water, fire protection and storm drainage facilities for the intended purpose The site is accessible by crosswalk at all four crossings at the intersection of Blackstone and Gettysburg. Proximity to public transportation is a key consideration in our site selection and as such, access is available at the Gettysburg station which is less than 500 feet from the location. Overall Building Description 4592 North Blackstone Avenue was constructed in 2007 and is approximately 4,691 square feet. The project will utilize 3,370 square feet and the remaining 1,321 square feet will remain occupied by a takeout restaurant, Raspados California. The project will have access to more than the required number of parking spaces to fully comply with Fresno Municipal Code parking standards. Furthermore, the business will be served by highways adequate in width and improved upon in order to carry the kind and quantity of traffic generated by the busi- ness. This building and lot are adequate in size and shape to accommodate the yards, walls, fences, parking and loading facilities, landscaping and all items required for further development. Floor Plan Description Our floor plan was developed in conjunction with our design and development team along with our Head of Security, Matt Carroll. Matt has developed more than 460 commercial security plans and serves as a cannabis security consultant for the Benicia and Dixon police departments. Below please find a thorough description of the floor plan. 175 Entry, Lobbies, Waiting Area and Exit (Light Blue Box) 14: Screening Lobby: Upon approaching the premises, a potential patient or consumer enters a secure screening lobby from which no further entry into the facility is permitted until identification verification has occurred. Unlike traditional dispensary models which forsake the safety of its security and staff with an exposed con- cierge position, this model ensures no security or staff member must come into direct contact with any person until that person has been duly identified by government issued photo identification. Designing access control in this manner in lieu of relying on a human resource also frees one of the assigned security officers from the traditional gatekeeper role and allows the security officer to be more dynamic, unpredictable and effective. 11. Waiting Area: After identification verification is complete, a patient or customer is buzzed into the waiting area and either immediately granted access to the retail entry point or asked to wait to maintain appropriate social distancing protocols on the retail sales floor, depending on total occupancy at the time of arrival. Maintaining the retail area in an uncongested manner is critical to effectively monitoring customers in the retail area. Controlling the number of customers in the retail area to no more than 2 per assigned retail employee will improve natural surveillance by staff and security and will ensure video surveillance footage is not hampered by crowding. To maintain a retail area 2:1 ratio, a waiting room is included in the design – providing a safe and comfortable place for overflow customers to wait their turn without creating unsightly and unsafe outdoor queueing. Retail Exit: Customers completing their business in the retail area will depart through a door redundant exit vestibule. The asynchronous doors will be electronically controlled and will prevent unscreened persons from the lobby from entering the retail area as others depart. Use of separate inbound and outbound paths to the retail room accomplish several security goals: 176 • Territorial Reinforcement: A designed flow is created with a distinct and unwavering path of travel for customers: lobby → waiting → retail → exit path → lobby. Any deviation from this designed path will naturally garner attention and scrutiny from staff and security personnel. • True access control: Access from the waiting area to the retail area is controlled by the security officer through electronic locks. Customers do not retreat through the retail entry door. In those retail locations with a single retail entry/exit door, operators effectively place control of the door into the hands of their customers. In those cases, the design does not prevent an outbound customer from granting entry to an inbound intruder. A single entry/exit system is more easily overcome by co-conspirators who can work in concert to create a clear path from the lobby to the retail area. By keeping the retail entry strictly electronically controlled by a shielded security officer, opportunities for such manipulation of the design by offenders is mitigated. • In the event that a security incident were to arise in the retail area, offender flight from the premises through the exit path reduces exposure to other customers and affords the business an opportunity to employ an “all lock” command, containing the offender in the retail exit vestibule pending a police response. The availability of this feature is in itself a substantial deterrent to those persons casing the premises for robbery and shoplifting purposes. 12. Reception, Registration and Security. This area is designed with a “fishbowl” concept, allowing the assigned reception and security officer stationed here to maintain natural surveillance over the public entrance/ lobby, waiting area, retail area and retail exit. The designed environment was developed in a manner that inherently deters and delays unauthorized access, theft, burglary and robbery from third parties, while simultaneously maximizing internal accountability to prevent diversion of cannabis goods and currency by employees. Dedicated Loading and Vendor Lobby (Olive Box) 7. Separate Vendor Entrance. This model delivers three key security advantages over those proposing a single access point: • Current state regulations prohibit the sharing of a public/vendor entry point during business hours, restricting single-entrance operators to scheduling distribution activities in narrow time frames, often during hours of darkness, before or after business hours. Those hours are statistically most likely to incur a robbery attempt; • Similarly, as currency transfers are necessary, the availability of a second access point enhances randomizing of transfers, allowing those transfers to occur during daylight and active periods of the day benefiting from natural users and natural surveillance in the area; and • Retail delivery staff, who may handle thousands of dollars’ worth of product when departing the premises, do not interface with the storefront retail portion of the business. Retail delivery drivers, who make multiple trips in to and out of the premises, enjoy heightened opportunities for product diversion by virtue of their duties. Where this employee group shares access to and through the storefront retail areas, opportunities for internal theft and diversion are maximized. Our design eliminates the cross-pollination of these work groups, keeping each segregated by design, reducing exposure and enhancing accountability. 7. Dedicated Loading Area. This premises diagram includes a reserved, private parking space immediately adjacent to the vendor lobby dedicated to loading. This will reduce exposure during product and currency movements to and from the business. 177 7. Vendor Lobby. Distributors, currency transporters, service vendors and delivery drivers will access the premises through the vendor lobby. A service window connects this receiving and waiting area from the delivery processing office which serves the reception needs for persons entering here. Staff will have electronic credentials granting access here while third parties will request access by way of a doorbell and intercom. Staff in the delivery processing office will be equipped with remote control over the lobby door to grant access to authorized third parties. Notwithstanding needs to access the break room and restroom, delivery drivers will be restricted to the vendor and driver lobby. As regulations require delivery drivers to return to the premises if not managing orders for more than thirty minutes, a premise should have a staging area for these employees that does not grant these employees access to sensitive areas. Retail Area (Yellow Box) The retail area employs a counter design that provides an enhanced ability for staff to naturally surveil customers in the retail area. This reduces any feelings of anonymity on the part of an offender. Similarly, this places staff where they naturally monitor one another – deterring internal theft opportunities. A product pass-through and drop safe are incorporated into the wall between the secure product storage room and the retail area. While many retailers allow virtually all staff members to access the product storage room to fulfill customer needs, our model incorporates a single fulfillment agent stationed in the product storage room. This model ensures the highest of protections against internal theft while also communicating to onlookers the high security and target hardening in place at this business. The need for currency and product to be carried throughout corridors and rooms of the premises are eliminated with this model, further reducing opportunities for internal and external threats against these assets. All retail area product and currency transfers occur in an easily monitored, highly controlled, naturally and electronically surveilled environment. Back of House / Restricted Access Areas (Dark Blue Box) 6. Secure Transfer. Staff assigned here will manage online and phone orders for delivery and express pickup. Like their counterparts in the retail area, staff assigned here will not access the secure product storage room to fulfill their orders. A pass-through connecting this room to the product storage room will be used to move goods from the inventory manager to the delivery processing room. Locking cabinets in this room will be used to temporarily store exit-packaged goods awaiting pickup by the assigned delivery driver. Delivery drivers will not have access to this room and will receive orders and remit fees through the service window connecting this room to the driver lobby. 3. Secure Inventory: The product storage room does not share a wall with the outside environment. It will be designed of hardened construction, heavily alarmed and surveilled and with an independent solid lid. An inventory manager will be assigned here and will be responsible for fulfilling retail area and delivery orders through door redundant pass through devices. This model maximizes accountability by limiting the product storage area to a single role in the business operations. 2. Admin Office. The management office is situated in a manner that allows the general manager to conduct employment interviews and to manage other third parties in a controlled manner. Applicants and vendors with appointments will be received in the vendor lobby and escorted through benign areas (staff corridors) to the management office. Nowhere along this path of travel will third parties have access to unsecured product or currency. 178 1. Vault and Records. The vault and records room is accessible only by way of passing through the management office which will be limited to those with management level electronic access credentials. The exterior wall is of block concrete construction. All other walls will be of reinforced construction including a solid lid. 10. Break Room. The break room, staff corridor and restrooms will be accessible to all employees. To maxi- mize accountability and to reduce opportunities for theft and diversion, employees assigned to storefront retail operations will not have electronic access credentials to the delivery side of the house. Similarly, those assigned to delivery processing will not have electronic access credentials to the retail area. SECTION 6.2 The application shall include at least one (1) photograph of the front (street side) of the building or street view of the vacant parcel. SECTION 6.3 Premises (Site) Diagram for each proposed location. In addition to diagrams submitted for other sections of the CCB Application, applicants are expected to submit a premise/site diagram that focuses on the overall property, building. This diagram should show the overall parcel and adjoining or neighboring buildings that may be affected by the commercial cannabis business. Please see below. 6.3.1. A Premise (Site) Diagram must be accurate, dimensioned and to-scale (minimum scale of ¼”). The diagram shall provide a detailed description of all available/shared parking spaces, driveway locations, and auxiliary buildings on the parcel. (Blueprints and engineering site plans are not required at this point of the application process. Security features are not required for this section.) 179 SECTION 6. LOCATION SECTION 6.1 In addition to the location-related details provided in the Commercial Cannabis Business (CCB) Application (pages 1-7), the applica- tion shall include a thorough description of the proposed location, including but not limited to the overall property, building, and floor plan. The proposed location is at 4592 North Blackstone Avenue, Fresno, CA 93726. The APN is 428-010-15. Overall Property Description The lot contains an existing standalone building that is situated on approximately 15,681 square feet of land on the corner of Blackstone Avenue and Gettysburg Avenue. The parcel is neighbored to the South by Taqueria Don Pepe at 4582 North Blackstone Avenue and to the West by a parking lot affiliated with Ramos Furniture located at 4550 North Blackstone Avenue. This site fully complies with Section 9-3307 of the Fresno Municipal Code and: • Is located in the allowable CMX zoning designation • Is more than eight hundred (800) feet from a sensitive use • Conforms with the City’s general plan, any applicable specific plans, and design requirements • Complies with all zoning and related development standards • Is constructed in a manner that minimizes odors to surrounding uses, and promotes quality design and construction, and consistency with the surrounding properties • Has adequate electricity, sewer, disposal, water, fire protection and storm drainage facilities for the intended purpose The site is accessible by crosswalk at all four crossings at the intersection of Blackstone and Gettysburg. Proximity to public transportation is a key consideration in our site selection and as such, access is available at the Gettysburg station which is less than 500 feet from the location. Overall Building Description 4592 North Blackstone Avenue was constructed in 2007 and is approximately 4,691 square feet. The project will utilize 3,370 square feet and the remaining 1,321 square feet will remain occupied by a takeout restaurant, Raspados California. The project will have access to more than the required number of parking spaces to fully comply with Fresno Municipal Code parking standards. Furthermore, the business will be served by highways adequate in width and improved upon in order to carry the kind and quantity of traffic generated by the busi- ness. This building and lot are adequate in size and shape to accommodate the yards, walls, fences, parking and loading facilities, landscaping and all items required for further development. Floor Plan Description Our floor plan was developed in conjunction with our design and development team along with our Head of Security, Matt Carroll. Matt has developed more than 460 commercial security plans and serves as a cannabis security consultant for the Benicia and Dixon police departments. Below please find a thorough description of the floor plan. 175 Entry, Lobbies, Waiting Area and Exit (Light Blue Box) 14: Screening Lobby: Upon approaching the premises, a potential patient or consumer enters a secure screening lobby from which no further entry into the facility is permitted until identification verification has occurred. Unlike traditional dispensary models which forsake the safety of its security and staff with an exposed con- cierge position, this model ensures no security or staff member must come into direct contact with any person until that person has been duly identified by government issued photo identification. Designing access control in this manner in lieu of relying on a human resource also frees one of the assigned security officers from the traditional gatekeeper role and allows the security officer to be more dynamic, unpredictable and effective. 11. Waiting Area: After identification verification is complete, a patient or customer is buzzed into the waiting area and either immediately granted access to the retail entry point or asked to wait to maintain appropriate social distancing protocols on the retail sales floor, depending on total occupancy at the time of arrival. Maintaining the retail area in an uncongested manner is critical to effectively monitoring customers in the retail area. Controlling the number of customers in the retail area to no more than 2 per assigned retail employee will improve natural surveillance by staff and security and will ensure video surveillance footage is not hampered by crowding. To maintain a retail area 2:1 ratio, a waiting room is included in the design – providing a safe and comfortable place for overflow customers to wait their turn without creating unsightly and unsafe outdoor queueing. Retail Exit: Customers completing their business in the retail area will depart through a door redundant exit vestibule. The asynchronous doors will be electronically controlled and will prevent unscreened persons from the lobby from entering the retail area as others depart. Use of separate inbound and outbound paths to the retail room accomplish several security goals: 176 • Territorial Reinforcement: A designed flow is created with a distinct and unwavering path of travel for customers: lobby → waiting → retail → exit path → lobby. Any deviation from this designed path will naturally garner attention and scrutiny from staff and security personnel. • True access control: Access from the waiting area to the retail area is controlled by the security officer through electronic locks. Customers do not retreat through the retail entry door. In those retail locations with a single retail entry/exit door, operators effectively place control of the door into the hands of their customers. In those cases, the design does not prevent an outbound customer from granting entry to an inbound intruder. A single entry/exit system is more easily overcome by co-conspirators who can work in concert to create a clear path from the lobby to the retail area. By keeping the retail entry strictly electronically controlled by a shielded security officer, opportunities for such manipulation of the design by offenders is mitigated. • In the event that a security incident were to arise in the retail area, offender flight from the premises through the exit path reduces exposure to other customers and affords the business an opportunity to employ an “all lock” command, containing the offender in the retail exit vestibule pending a police response. The availability of this feature is in itself a substantial deterrent to those persons casing the premises for robbery and shoplifting purposes. 12. Reception, Registration and Security. This area is designed with a “fishbowl” concept, allowing the assigned reception and security officer stationed here to maintain natural surveillance over the public entrance/ lobby, waiting area, retail area and retail exit. The designed environment was developed in a manner that inherently deters and delays unauthorized access, theft, burglary and robbery from third parties, while simultaneously maximizing internal accountability to prevent diversion of cannabis goods and currency by employees. Dedicated Loading and Vendor Lobby (Olive Box) 7. Separate Vendor Entrance. This model delivers three key security advantages over those proposing a single access point: • Current state regulations prohibit the sharing of a public/vendor entry point during business hours, restricting single-entrance operators to scheduling distribution activities in narrow time frames, often during hours of darkness, before or after business hours. Those hours are statistically most likely to incur a robbery attempt; • Similarly, as currency transfers are necessary, the availability of a second access point enhances randomizing of transfers, allowing those transfers to occur during daylight and active periods of the day benefiting from natural users and natural surveillance in the area; and • Retail delivery staff, who may handle thousands of dollars’ worth of product when departing the premises, do not interface with the storefront retail portion of the business. Retail delivery drivers, who make multiple trips in to and out of the premises, enjoy heightened opportunities for product diversion by virtue of their duties. Where this employee group shares access to and through the storefront retail areas, opportunities for internal theft and diversion are maximized. Our design eliminates the cross-pollination of these work groups, keeping each segregated by design, reducing exposure and enhancing accountability. 7. Dedicated Loading Area. This premises diagram includes a reserved, private parking space immediately adjacent to the vendor lobby dedicated to loading. This will reduce exposure during product and currency movements to and from the business. 177 7. Vendor Lobby. Distributors, currency transporters, service vendors and delivery drivers will access the premises through the vendor lobby. A service window connects this receiving and waiting area from the delivery processing office which serves the reception needs for persons entering here. Staff will have electronic credentials granting access here while third parties will request access by way of a doorbell and intercom. Staff in the delivery processing office will be equipped with remote control over the lobby door to grant access to authorized third parties. Notwithstanding needs to access the break room and restroom, delivery drivers will be restricted to the vendor and driver lobby. As regulations require delivery drivers to return to the premises if not managing orders for more than thirty minutes, a premise should have a staging area for these employees that does not grant these employees access to sensitive areas. Retail Area (Yellow Box) The retail area employs a counter design that provides an enhanced ability for staff to naturally surveil customers in the retail area. This reduces any feelings of anonymity on the part of an offender. Similarly, this places staff where they naturally monitor one another – deterring internal theft opportunities. A product pass-through and drop safe are incorporated into the wall between the secure product storage room and the retail area. While many retailers allow virtually all staff members to access the product storage room to fulfill customer needs, our model incorporates a single fulfillment agent stationed in the product storage room. This model ensures the highest of protections against internal theft while also communicating to onlookers the high security and target hardening in place at this business. The need for currency and product to be carried throughout corridors and rooms of the premises are eliminated with this model, further reducing opportunities for internal and external threats against these assets. All retail area product and currency transfers occur in an easily monitored, highly controlled, naturally and electronically surveilled environment. Back of House / Restricted Access Areas (Dark Blue Box) 6. Secure Transfer. Staff assigned here will manage online and phone orders for delivery and express pickup. Like their counterparts in the retail area, staff assigned here will not access the secure product storage room to fulfill their orders. A pass-through connecting this room to the product storage room will be used to move goods from the inventory manager to the delivery processing room. Locking cabinets in this room will be used to temporarily store exit-packaged goods awaiting pickup by the assigned delivery driver. Delivery drivers will not have access to this room and will receive orders and remit fees through the service window connecting this room to the driver lobby. 3. Secure Inventory: The product storage room does not share a wall with the outside environment. It will be designed of hardened construction, heavily alarmed and surveilled and with an independent solid lid. An inventory manager will be assigned here and will be responsible for fulfilling retail area and delivery orders through door redundant pass through devices. This model maximizes accountability by limiting the product storage area to a single role in the business operations. 2. Admin Office. The management office is situated in a manner that allows the general manager to conduct employment interviews and to manage other third parties in a controlled manner. Applicants and vendors with appointments will be received in the vendor lobby and escorted through benign areas (staff corridors) to the management office. Nowhere along this path of travel will third parties have access to unsecured product or currency. 178 1. Vault and Records. The vault and records room is accessible only by way of passing through the management office which will be limited to those with management level electronic access credentials. The exterior wall is of block concrete construction. All other walls will be of reinforced construction including a solid lid. 10. Break Room. The break room, staff corridor and restrooms will be accessible to all employees. To maxi- mize accountability and to reduce opportunities for theft and diversion, employees assigned to storefront retail operations will not have electronic access credentials to the delivery side of the house. Similarly, those assigned to delivery processing will not have electronic access credentials to the retail area. SECTION 6.2 The application shall include at least one (1) photograph of the front (street side) of the building or street view of the vacant parcel. SECTION 6.3 Premises (Site) Diagram for each proposed location. In addition to diagrams submitted for other sections of the CCB Application, applicants are expected to submit a premise/site diagram that focuses on the overall property, building. This diagram should show the overall parcel and adjoining or neighboring buildings that may be affected by the commercial cannabis business. Please see below. 6.3.1. A Premise (Site) Diagram must be accurate, dimensioned and to-scale (minimum scale of ¼”). The diagram shall provide a detailed description of all available/shared parking spaces, driveway locations, and auxiliary buildings on the parcel. (Blueprints and engineering site plans are not required at this point of the application process. Security features are not required for this section.) 179 Section 3. Neighborhood Compatibility Plan Overview Embarc believes that operating a cannabis business is a privilege and not a right and that a successful business model requires consistent engagement with the community to ensure communication, transparency, integrity and collaboration. By putting the community first, Embarc ensures a positive relationship with the City of Fresno, community leaders, and the neighborhood, ultimately allowing us to participate in—and give back to—the community in meaningful ways. This commitment is embodied in ways large and small, ranging from neighborhood specific engagement and volunteerism to empowering community members to provide feedback and direction on our operational model—including community-sensitive advertising and directing community investment funding—via a Community Advisory Board comprised of local stakeholders. We understand that cannabis businesses have an obligation to the health and wellbeing of our customers, the neighborhood, and the broader community. One of Embarc’s core values is to be a good corporate citizen. We believe this goal requires a direct relationship not only with City officials but also with residents, other vital stakeholders and public safety officials. We intend to be a contributing, positive, and responsible force in the community, and we are committed to ensuring that our dispensary never poses a nuisance to our surrounding neighborhood or the community at large. Below we describe the specific strategies, procedures, and equipment that will be used to proactively address and respond to complaints related to noise, light, odor, litter, as well as vehicle and pedestrian traffic. Our dispensary will be maintained in accordance with the standards of the International Property Maintenance Code to ensure the licensed premises are safe, sanitary, and fit for occupation and use. We will proactively work with community members, neighborhood leaders, and local businesses to build a synergistic relationship based on respectful dialogue and ongoing approachability. We will be an active and engaged supporter of the neighborhood while operating as a pristine example of regulatory compliance and corporate responsibility. Our team of experienced cannabis operators and retailers understands the important role our dispensary will play in the Fresno community. As such, our Neighborhood Compatibility Plan is designed with the community in mind. We believe we have the expertise and sensitivity necessary to reach out to local leaders and residents, engage the community, and respond to their collective needs, based on our proven track record of doing so in other communities where we operate as well as our ownership’s nearly half century track record in this community. Based on our experience operating a successful and compliant retail and delivery operation in South Lake Tahoe, we understand the importance of a proactive approach in order to resolve any potential issues before they arise. That is why our General Manager, Managers, staff, and Head of Community Relations will be engaged in positive neighborhood relations on an ongoing basis. Being available and accessible is vital to preventing annoyances from escalating into issues. Our Head of Community Relations and Community Advisory Board will ensure that Embarc integrates seam- lessly into the community, while also establishing a system to address and mitigate complaints from citizens, customers, and other businesses in the area using a multi-step approach, detailed below. In addition to the input we receive from our Community Advisory Board on how best to avoid becoming a nuisance or having any unwanted impacts on the neighbors and the surrounding community, we will draw on 122 the considerable cannabis experience of our team to implement policies and procedures to avoid any nuisance pertaining to noise, light, odor, litter, vehicles, and pedestrian traffic. Our management team has developed rigorous training programs that all Embarc Fresno employees will be required to complete in order to understand the appropriate protocols for interacting with community members near the cannabis business, as well as a plethora of other topics and subjects crucial to a successful cannabis retail operation. This combination of leadership, well trained and sensitive employees and community members working together will create a consistent, proactive feedback loop to maintain positive relationships with the neighborhood and community. SECTION 3.1 Describe how the CCB will proactively address and respond to complaints related to noise, light, odor, litter, vehicles, and pedestrian traffic. Head of Community Relations Our proactive community engagement strategy will be led by Steve Hosey, a three-decades long Fresno resident and actively engaged citizen with a track record of engaging the community in diverse ways. Steve understands the issues and unique needs of communities and has experience in proactive community engagement as well as in addressing and mitigating any complaints from citizens, customers and other businesses in the area. Additionally, Steve will serve as the Chair of Embarc Fresno’s Community Advisory Board (the “Board”). The Board, comprised of prominent members of the Fresno community, will help shape best practices to innovate and improve operations in order to mitigate any potential for complaints from citizens, customers, and other businesses in the area. Embarc recognizes that part of a successful complaint mitigation strategy is effective community engagement, and our Board will have unmatched insight into the community. Our board will be empowered to provide input on how Embarc can make a lasting positive impact on its neighbors and allow us to address any potentially problematic issues before they arise. We are doing more than simply conducting open houses; we are empow- ering community members on an ongoing basis to play an integral role in anticipating and mitigating any complaints. Good Neighbor Policy As part of our Neighborhood Compatibility Plan, we will voluntarily seek to have a Good Neighbor Policy added as a condition of our operations. This policy and overarching plan will ensure that we are not only meeting but exceeding the requirement to address proactively and respond to complaints regarding neighbor- hood nuisances related to noise, light, odor, litter, vehicle and pedestrian traffic. Further, our Community Advisory Board will be actively involved in this process and will serve as a feedback loop to our Head of Community Relations and chair of the Advisory Board, Steve Hosey. In partnership with the applicant team, Community Advisory Board and with feedback solicited from neighbors and the broader community, we have drafted proposed policies. We welcome the opportunity to discuss these further with the City should we be fortunate enough to be awarded a license. Our intent to include such a policy as a condition of operations demonstrates the seriousness with which we approach mitigating any complaints of neighborhood nuisances related to noise, light, odor, litter, vehicle and pedestrian traffic, and any other complaints that may arise from the community. The suggested policy is detailed below. 123 As a responsible cannabis operator, Embarc Fresno must: • Create a safe exterior environment through design and site management. • Provide outside lighting in a manner that illuminates the outside street and sidewalk areas and adjacent parking as appropriate. • Maintain the premises and adjacent sidewalk in good condition at all times. • Manage parking and traffic to negate impacts to surrounding areas. • Prohibit double parking directly outside the premises. • Prohibit loitering around the premises or in the parking lot. • Enforce appropriate customer behavior outside the facility and in adjacent areas. • Prohibit loitering in or around the premises. • Prohibit littering in or around the premises. • Prohibit the consumption of cannabis products around the premises. • Post notices at all public entrances to and exits from the establishment that are clear, well-lit, promi- nently displayed and maintained. • Direct patrons to leave the establishment and neighborhood peacefully and in an orderly fashion. • Direct patrons to not litter or block driveways. • Advise individuals of the prohibition on loitering. • Provide the contact information for Embarc personnel responsible for community relations and issue mitigation. • Provide adequate and appropriate ventilation to ensure odor controls result in no emission of noxious odors. • Advise individuals that cannabis consumption is prohibited in public places. • Be a benefit to surrounding parcels. • Maintain the premises in a clean and orderly fashion. • Instruct security personnel to secure the premises within 50 feet of any public entrance and exit. Mitigation Process to Proactively Address and Respond to Complaints Embarc employs a protocol for addressing and mitigating complaints from citizens, customers, and other businesses in the area. This protocol ensures consistency in response and provides the data we need to modify Standard Operating Procedures to alleviate any likelihood of issue recurrence. We will implement comprehensive, responsible neighbor and nuisance mitigation strategies to alleviate any community concerns. Although we believe that our Head of Community Relations will be able to prevent these issues from arising in the first place by cultivating healthy and frequent communication with our neighbors, company policies will require that any staff member receiving a complaint report the concern to his or her Manager immediately. We understand other potential impacts may arise from normal business operations that have not been contem- plated here. Should that occur, we will work closely with community members, neighborhood leaders, and local businesses to document and promptly take whatever actions are necessary to resolve any issue. We will maintain on-site all records of complaints. Should a complaint occur, employees will be required to adhere to the following written policies and procedures: STEP 1: Document the Concern or Complaint Any employee receiving a complaint will first document the concern on a standardized company form. The employee will record as much information from the aggrieved individual as possible, including the source of concern and the length of time it has transpired. The employee will also ask for and record the individual’s contact information for follow-up. Employees will be trained to ensure the aggrieved 124 individual understands we are sympathetic to his or her concerns and seek to address them immediately and transparently. STEP 2: Immediately Report the Concern or Complaint Employees will be trained and required to immediately report any concern or complaint to the General Manager and the Head of Community Relations. The employee will scan and provide the form via email to both Steve Hosey and the General Manager with the subject line “FOR IMMEDIATE ATTENTION.” Employees are also encouraged to provide their suggested solutions and potential mitigation strategies as part of the email. Once emailed, the employee is also directed to speak with the General Manager in person, or a Manager if the General Manager is not available. STEP 3: Develop and Execute a Plan of Action Next, the General Manager, Head of Community Relations, and employee will develop and execute an action plan to resolve the issue. The plan will articulate, and Embarc will implement, a short-term solution to alleviate the complainant’s concern as well as a long-term solution to prevent the issue from arising in the future. we will incorporate any long-term solutions into our standard operating proce- dures to prevent the issue from reoccurring and employees will be trained on the new policy within one week of the solution being implemented. STEP 4: Follow up With Complainant Our Head of Community Relations will personally follow-up with the complainant to ensure his or her concern was adequately and efficiently resolved. During the conversation, the Head of Community Relations will identify the actions taken to mitigate the concern and the protocols that were developed to prevent the issue from occurring again. Finally, the Head of Community Relations will inquire if there are any additional concerns the aggrieved individual would like Embarc to rectify or if the issue was resolved to his or her satisfaction. STEP 5: Document the Incident and Resolution Lastly, our Head of Community Relations or designee will create a complaint report of the entire incident that documents the following: •Concern, complaint, or grievance •Reporting employee’s information •Complainant’s contact information •Action plan and resolution •Future protocols that were implemented to prevent the issue from reoccurring •Follow-up conversation with the complainant and his or her disposition of the resolution •Trainings that occurred as a result of the any newly developed standard operating procedures Complaint reports will be distributed to ownership to ensure accountability and awareness. We will keep all complaint reports for a minimum of five (5) years, unless otherwise required by law. Periodically, our Head of Community Relations will audit these complaint reports to certify that the new protocols are effective. Noise Mitigation Embarc is taking a number of precautions and implementing a variety of measures guaranteed to combat and mitigate excessive noise. Embarc will never produce excessive or unnecessary noises that would detrimentally impact the public health, comfort, safety, welfare or prosperity of the surrounding neighborhood and Fresno community. 125 All noise producing activities, including but not limited to, construction, landscaping, and motor vehicle operation, will comply with all Fresno noise ordinances. No sound production or reproduction systems inside the facility will be maintained at a volume level higher than what is necessary for the convenient hearing of persons present, including receiving activities. We will prohibit horns or signal devices on any of our company or employee vehicles, except as a danger signal or to give warning. To minimize our impact on the neighborhood during build-out of our facility, construction activities will only occur with a special permit from the City, between reasonable or preapproved hours. The entire premises, including the parking lot, will be monitored under constant video surveillance and routinely patrolled by our security guards. If any person or vehicle is identified as causing a disturbance or being excessively noisy, that individual will immediately be escorted off the premises and, if necessary, reported to law enforcement. We will ensure all motor vehicles on our premises, including motorcycles, adhere to appropriate sound level decibels. Motor vehicles exceeding these established limits will be asked to leave the premises by our security team. Our security guards will also work to ensure no motor vehicle on our premises is left idling. Light Mitigation Embarc understands the community’s desire for a safe and secure facility that blends seamlessly into the surrounding neighborhood, along with the ability to enjoy the night sky without obtrusive bright lights. The exterior of our dispensary, including the parking lot, will be adequately illuminated for security purposes while not posing a nuisance. •Exterior lighting will be white light using LED lamps with full cutoff fixtures to limit glare and light trespass. Color temperature will be between 2700K and 4100K with a color rendering index of 80 or higher and a light loss factor of .95 or better. •Light poles will be no higher than 20’. Broken or damaged exterior lighting will be repaired or replaced within 48 hours of being noted. •Entry drives, drive aisles, parking and bicycle parking will be illuminated to a maintained minimum of 1.5 foot candles per square foot of parking area at a 6:1 average to minimum ratio. •Exterior walkways, alcoves and passageways will be illuminated to a maintained minimum of 1/3 foot candles per square foot of surface area at a 6:1 average to minimum ratio. •Exterior lighting will be shielded or otherwise designed to avoid spill-over illumination to adjacent streets and properties. • All mature landscaping will follow the two-foot, six-foot rule. All landscaping will be ground cover, two feet or less and lower tree canopies of mature trees will be above six feet. This increases natural surveillance and eliminates hiding areas within the landscaping. • Tree canopies will not interfere with or block lighting to avoid creating shadows or areas of conceal- ment. The landscaping plan will allow for proper illumination and visibility for surveillance cameras. Should facility lighting give rise to a complaint, we will work to develop a compliant lighting solution that accommodates neighborhood concerns without sacrificing security. Our Chief Operating Officer, construction team and General Manager will ensure that the electrical system and lighting comply with all applicable state and local laws, regulations, ordinances, and other requirements, are maintained in good repair, and do not present an electrical shock or fire hazard. Odor Mitigation Through a combination of high-tech air scrubbing and carbon filtration systems, negative air pressure, and other odor mitigating techniques, we are employing industry-leading best practices to ensure that our odor mitigation design embraces regulatory compliance and nuisance mitigation. Given spatial constraints, please see Section 3.3 for detail on these mitigation techniques and technologies. 126 Our Odor Mitigation Plan was created and refined through our team’s years of experience operating industry-leading cannabis facilities. We know that, if not properly treated, cannabis odors can create a public nuisance in the surrounding community. Such a condition is antithetical to our goal of being a contributing member and good steward of our community. Consequently, we will take all possible steps to treat odors before they become problematic and address any complaints of unpleasant or offensive odors arising from the facility. As a component of our proposed Good Neighbor Policy, Embarc will be responsible for developing, imple- menting and maintaining an Odor Management Plan. This includes maintaining all records relating to odor management, including system installation, maintenance, equipment malfunctions and deviations from the plan. The General Manager will verify the effectiveness of the air quality management system weekly by physically inspecting the system by listening for the sound of the system, visually ensuring the lights are on and the system is functioning and verifying there is no odor. The General Manager will log that the system has been checked weekly in an odor control maintenance log. In the event that we receive an odor complaint, the General Manager will: • Log the date, time, source, contact information and description of the complaint. • Identify within 30 minutes the source of the odor by physically inspecting the premises for any unpackaged cannabis product that may be emitting odor. This includes inspecting all areas of the premises including the secure storage area and retail floor, or any other areas where cannabis products are featured or stored. • Dispose of the flower, or cannabis product, in a secure and air-tight waste disposal area and logging the disposed product in the track and trace system and the odor control log. • Physically inspect the odor control system, within 30 minutes of receiving an odor complaint, to ensure it is functioning properly. • Immediately contact the manufacturer If the General Manager identifies that the odor control system is malfunctioning. • Determine if the issue can be addressed with the manufacturer over the telephone. If the malfunction cannot be resolved over the phone, the General Manager will schedule the first available appointment with the manufacturer to visit the premises to physically inspect the odor control system. • Immediately place an order for the first available replacement part or new system if the odor control system cannot be fixed. • Immediately communicate the complaint and resolution to Embarc’s executive management team via email within two hours. • Discuss the source and resolution of the odor complaint or issue with the employees at the next team meeting to develop and implement procedures to avoid a future odor complaint. Litter Control We will employ two primary methods to control litter. First, we will provide ample waste receptacles for customers and staff. We believe the best tool in the fight against litter is simply to give our patrons and employ- ees ample places to properly dispose of their refuse. Secondly, our staff will inspect the premises for litter at least hourly. We will maintain and enforce strict no-littering policy for all employees and customers. Any employee who litters on the premises will first receive a written warning, followed by increasingly serious disciplinary actions. Our retail floor, back of house and exterior areas will have ample multiple three-stream waste receptacles for convenient customer and employee use, allowing for proper disposal of their non-cannabis waste in landfill, recycling, and compost compartments and to streamline the disposal process. 127 With ample access to proper receptacles, and a culture of intolerance for litter (or other nuisances), there will be no excuse for our employees to fail to dispose of their waste properly. All cannabis product waste will be disposed of in compliance with all applicable state and local laws, regulations, ordinances, and other require- ments. In the event a neighbor or member of the community feels that litter is accumulating in or around our facility, our General Manager will coordinate with the Head of Community Relations and immediately rectify the situation. Vehicle Traffic We do not anticipate impacts to vehicle traffic given the site’s ample parking and thoughtful site layout. However, we have nevertheless considered vehicular turning movements in relation to traffic flow, proximity and relationship to intersections, adequacy of sight distances, location, and access of parking and, should impacts to vehicle traffic occur, Embarc will designate an employee to manage customer parking and traffic flow in the parking lot. Furthermore, we will offer pre-ordering promotions and other discounts to encourage patrons to visit the store during non-peak hours to reduce vehicle traffic during peak hours. In the event a community member is concerned with vehicular traffic, our Head of Community Relations will immediately investigate the situation and develop a more robust response protocol. Pedestrian Traffic Our facility has been thoughtfully designed to ensure efficient customer flow to prevent pedestrian traffic from spilling out beyond the property or otherwise impacting flow of traffic. Furthermore, in the event that the store has a large gathering of customers, there will be clearly delineated lines and a waiting area, to make certain that customers are waiting in an orderly fashion and avoiding a pileup of pedestrian traffic outside the store. Security guards will also be patrolling the property to help the flow of pedestrian traffic. If there are still issues pertaining to pedestrian traffic, Embarc will engage an employee outside the store to manage the flow of pedestrian traffic and offer pre-ordering promotions and other discounts to encourage patrons to visit the store during non-peak hours. In the event a community member is concerned with pedes- trian traffic, our Head of Community Relations will immediately investigate the situation and develop a more robust response protocol. Conclusion Outlined above are some of the policies, procedures and plans we will implement in order to eliminate any unwanted impacts on our neighbors and the surrounding community involving noise, light, odor, litter, vehicles, and pedestrian traffic. We will always be driven by our guiding principles of systematically and continuously engaging with the community; listening and responding to community needs and desires; and always striving to make a positive and measurable difference in the Fresno community. SECTION 3.2 Describe how the CCB will be managed to avoid becoming a nuisance or having impacts on its neighbors and the surrounding community. The keys to effectively managing the business such to protect against becoming a nuisance are a Good Neighbor Policy as a foundation of our business model and community approachability such that residents feel they can engage in dialogue directly with the Embarc team. Community Approachability Embarc will provide to both the City and to all businesses and residences within 1,000 feet of the store, contact information for Embarc’s day-to-day supervisory/managerial personnel. 128 Additionally, we will provide the Police Chief with the name, telephone number (both landline and mobile, if available) of at least one 24-hour on-call designated emergency contact employee to respond to complaints and/ or operating problems or concerns. This contact information will also be readily available online and posted conspicuously on the exterior of the facility such that any passerby can access management staff with issues at any time. We will encourage neighbors to report any impact, real or perceived, that they experience in relation to Embarc’s operations. Thereafter, we will dedicate all reasonable time and effort to resolving any such issue to the impacted neighbor’s satisfaction. This mitigation could include making a roaming security officer available as a means of addressing any nuisance activities perceived as attributable to our business operations. Any such assigned security officer will be directed to mitigate the situation to the maximum limit permitted by the Private Security Services Act. Furthermore, we will encourage neighboring residents to contact our personnel prior to contacting the City. Depending on the nature of the issue and whether it is community or operationally based, the inquiry will be managed by Embarc’s Head of Community Relations or Embarc Fresno’s General Manager. In this capacity, Steve and/or the General Manager will be responsible for timely resolving any community issues or concerns brought to our attention. Community and Neighborhood Outreach As existing cannabis retail operators, we appreciate the need for ongoing engagement and collaboration with the community at large and the neighborhood surrounding our facility. In addition to our extensive community benefits programs, we have also identified ongoing engagement strategies to ensure thoughtful integration of our proposed operations into the neighborhood. Given that COVID-19 has made in person events and door-to-door canvassing potentially unsafe, we propose the following outreach and engagement efforts prior to opening the store: • Neighboring Business Outreach Embarc will conduct outreach to businesses within a 1,000 foot radius as well as business and neighbor- hood associations that have a presence in the neighborhood. During this outreach, we will explain our business model, provide renderings of our proposed location, detail our track record of neighborhood improvement, and seek to identify ways to maintain open dialogue, such as our Community Advisory Board. We will also solicit these business’ feedback and try to elicit any suggestions or potential concerns from them prior to opening for business to allow for meaningful discussion of mitigation techniques and protocols. • Open Houses We will host at least three open houses between the award of the license and the commencement of operations, designed to provide residents with the opportunity to meet our owners, ask questions about our proposed operations and get a better understanding of our vision. During these open houses, we will focus on impact mitigation and community benefits but will be available to surface and answer any and all community questions and/or concerns. These direct engagement opportunities are important to addressing concerns related to cannabis operations. Assuming COVID-19 conditions continue, at least some of the open houses will likely be undertaken virtually via Zoom or other similar platform. However, prior to opening the store, we will host at least one in-person meeting (with a mandatory sign-up sheet to ensure we are able to adequately maintain an appropriate capacity, social distancing and to facilitate contact tracing if it becomes necessary) in 129 order to provide store tours to interested residents and business owners. These tours will be focused on community members in the immediately surrounding neighborhood and are intended to provide an understanding of the myriad compliance and security measures in place governing operations. Based on our experience, this type of interactive educational community outreach is essential to solicit neighbor- hood feedback, answer questions, proactively address concerns prior to opening, introduce our team to the neighborhood, and dispel concerns, myths, inaccurate perceptions, and general unawareness of how legal, compliant cannabis dispensaries operate. •Informational Canvassing Should the City find it appropriate, Embarc is willing to canvass the neighborhood prior to opening in order to answer constituent questions. Should door-to-door canvassing be considered unsafe given COVID-19, we would be willing, instead, to send a mail piece providing a phone number for Steve and the General Manager so that they can directly respond to queries. Doing so may help address comments and concerns proactively prior to opening the business. Once operational, our Head of Community Relations and management team will host semi-annual “open listening sessions,” where members of the community will be able to voice opinions, ask questions, and meet the Embarc team. Our goal for these sessions is to address any unforeseen concerns and to ensure we are fulfilling our obligations as a good neighbor. Neighborhood Safety Increased safety surrounding the facility is a positive byproduct of the immense attention-to-detail given to our facility’s security measures. Our presence in the neighborhood comes with patrolling security guards, an industry-leading surveillance system with coverage extending across the entirety of the interior and exterior of the facility and beyond, and advanced alarm systems with immediate access to local law enforcement. We are confident that the extreme importance placed on facility security and safety will result in a positive impact on the safety and wellbeing of our neighbors. In fact, other communities located near legal, compliant cannabis facilities have seen increased property values as a result of the enhanced security. Neighborhood Beautification While engaging the neighborhood is critical, we also believe in the importance of rolling up our sleeves and engaging in ongoing neighborhood beautification efforts. As part of our paid employee volunteerism program, detailed further in Sections 2 and 7, our staff will serve as a volunteer street team on beautification projects near the store. We will also seek to identify opportunities to partner with the Chamber of Commerce and/or local business associations and non-profit organizations to assist on an ongoing basis, from helping to fund and paint crosswalks to picking up litter from homeless encampments. Partnership with Local Law Enforcement As we have done in other cities and given the role law enforcement plays in the regulation of local cannabis retail businesses, Embarc will seek to form a positive ongoing dialogue with the Fresno Police Department. This includes a tour for officers prior to opening, recurring outreach and communications, and remote access to all Embarc security footage. SECTION 3.3 Describe odor mitigation practices. Embarc is committed to mitigating and controlling any odors associated with our facility and will be responsive to the odor control requirements set forth in the applicable state and local regulations. Specifically, Embarc will exceed the requirements set forth in Fresno Municipal Code pertaining to odor management. 130 • Embarc utilizes odor control devices and techniques to ensure that odors from cannabis are not detect- able off-site. • Embarc provides a sufficient odor absorbing ventilation and exhaust system so that odor generated inside the commercial cannabis business that is distinctive to its operation is not detected outside of the facility, anywhere on adjacent property or public rights-of-way, on or about the exterior or interior common area walkways, hallways, breezeways, foyers, lobby areas, or any other areas available for use by common tenants or the visiting public, or within any other unit located inside the same building as the commercial cannabis business. • Embarc will install and maintain the following equipment, or any other equipment which the City Manager determines is a more effective method or technology: • An exhaust air filtration system with odor control that prevents internal odors from being emitted externally; • An air system that creates negative air pressure between the commercial cannabis business’s interior and exterior, so that the odors generated inside the commercial cannabis business are not detectable on the outside of the commercial cannabis business. Embarc’s odor mitigation practices are intended to serve the following purposes: • To ensure that air circulation resulting from Embarc retail operations does not impact our employees’ health and welfare; • To ensure that air circulation resulting from Embarc retail operations does not impact surrounding businesses and outdoor areas; and • To ensure thoughtful operations that demonstrate a true commitment to the health and welfare of the City and its residents. Through our leadership team’s years of operating cannabis facilities across the country, and the lessons learned at Embarc Tahoe, we have developed industry-leading protocols and procedures to mitigate and eliminate any potentially offensive odors that could be detectable by the surrounding community. Many of Embarc’s odor mitigation practices overlap with its hygiene protocols. Embarc will train all employees to maintain a sanitary facility reinforced by anti-contamination standard operating procedures. Per Fresno regulations, Embarc prohibits employees from consuming cannabis within or outside our licensed facility, and odor control devices such as carbon filtration technology will be utilized to minimize the chances of off-site detection of odors emanating from our facility. To further minimize or eliminate odors emitted to the surround- ing community, no cannabis will be stored or displayed in an area accessible to the general public or stored overnight outside of the building. Our Odor Mitigation Plan will be approved by the applicable City authorities prior to operation. The system will consist of an exhaust air filtration system utilizing multiple fans and active carbon filters to prevent internal odors from escaping the facility. Generally, this means exhaust air will be filtered through active carbon filtra- tion and, where applicable, HEPA filters prior to exterior release. Carbon filters will be regularly inspected and recharged and/or replaced in accordance with usage and manufacturer specifications. Embarc will also perform self-inspections, encourage employee observation and reporting, and create response protocols to effectively address any odor complaints that may arise. It is our intention to resolve any complaints received from neigh- bors in a timely and satisfactory manner. Our administrative controls have been field-tested and proven effective. They have been designed to ensure that no odors will be detectable outside of our facility. Our General Manager will ensure all odor-producing activi- ties are isolated and mitigated and will perform routine audits to ensure that odor mitigation equipment, filters, and ventilation are working effectively and in good order. Each employee will be trained to ensure that all doors 131 remain closed and odor-emitting activities are isolated. If an employee notices any equipment malfunction, he or she is required to immediately report the situation to the General Manager, who will develop a plan of action to repair or replace the equipment. Please see Section 3.1—Odor Mitigation as well as subsequent responses for more detail on all the odor control devices and techniques employed by Embarc to mitigate odors. Odor mitigation practices are only as good as their implementation. Toward that end, Embarc’s Odor Mitigation Plan seeks to be all-encompassing, focused not only on the mitigation of odors but also on the ongoing mainte- nance of best practices with clearly defined process ownership, community engagement and communications protocols. It is this level of detail that ensures effective ongoing odor management is achieved. Embarc’s odor management is broken down into the following components: 1. Physical infrastructure 2. Best practices 3. Community engagement and responsiveness 4. Internal process ownership Physical Infrastructure Embarc’s approach to retail design contemplates the importance of physical infrastructure necessary to mitigat- ing odors. Best Practices Embarc will employ industry-leading best practices to prevent odors from being generated and/or detected inside or outside the facility. Embarc will provide a sufficient odor absorbing ventilation and exhaust system so that odor generated inside the business that is distinctive to its operation is not detected anywhere outside of the facility. Community Engagement & Responsiveness In addition to physical infrastructure designed to mitigate odors, an important component of our odor control plan is community engagement and responsiveness. While our facility is designed to eliminate odors, we rec- ognize that any new cannabis use, even if that use is not odor-generating, can result in questions and concerns from community leaders, residents and businesses. Thus, a critical component of our Odor Management Plan is a robust community responsiveness protocol designed to be proactive in addressing community questions and diligent in responding to concerns. Internal Process Ownership Embarc’s retail management structure ensures that there is at least one Manager on-site during all working hours. All Managers and staff are trained extensively on standard operating procedures, including the odor management protocols outlined in this proposal. Managers are responsible for ensuring any odor issues are resolved promptly and that the resolution is communicated effectively both internally and externally. As part of operational training, the General Manager will train all employees on odor detection, mitigation, and reporting. Additionally, each new hire must complete an odor control training curriculum including both odor detection and de-escalation techniques for use in discussion with a community member that may raise a concern. The General Manager will organize a retraining on administrative and engineering activities for odor mitigation at least once a year or following any material change in odor mitigation equipment or policy. Trainings will be conducted in person, using real world examples and hands-on learning activities. All employ- ees will be trained on Embarc’s specific activities for odor mitigation, including but not limited to: 132 • Employee responsibilities • The importance of closing doors and windows • Recordkeeping • Employee observation and reporting Additionally, the General Manager and other Managers will remain apprised of: • System design • Equipment cleaning • Ensuring exhaust and filtration systems are running as required • Equipment maintenance • Equipment audits and checks As part of the quarterly all-hands meetings, Embarc will engage in refresher courses to remind employees of best practices for odor mitigation. These refresher courses will be mandatory for all employees. During these trainings, the General Manager will stress that odor mitigation is each employee’s responsibility. Embarc will also emphasize the fact that we are members of the Fresno community, and that each employee therefore has an obligation to mitigate odors and make a positive impact on the neighborhood. Embarc’s employee training practices have been proven to be successful in our Tahoe store. Our hands-on experience operating this type of facility has taken the guesswork out of developing training protocols and allows us to utilize evidence-based training that has proven effective in various regulatory environments. SECTION 3.4 Identify potential sources of odor. As cannabis is increasingly legalized in states across the country, significant research is being undertaken to better understand odor intensity at each point in the cannabis supply chain. These findings are integral to ensuring thoughtful air quality management best practices are in place specific to each location along the chain. One example of the research driving the development of best practices can be seen in the City of Denver’s Public Health and Environment Guide to reducing the impact of cannabis operations on air quality. According to this Guide, odor generation is typically associated with the cultivation and manufacturing of cannabis, as both processes are odor intensive: The cannabis industry directly impacts air quality in two predominant operations; plant growth cultivation and Marijuana Infused Product (MIP) facilities. At cultivation facilities, the natural growth of cannabis plants and other processes emit terpenes which are VOCs known for their strong odors. At MIP [manufacturing] facilities, the evaporation of solvents and other processes in the production cycle result in Volatile Organic Compound (VOC) emissions. VOC’s alone do not typically pose a direct threat to human health or the environment. However, they do contribute to ground-level ozone by chemically reacting with other types of pollution, specifically, nitrogen oxides (NOx) in the presence of sunlight. Ozone is an air pollutant that is harmful to human health and negatively impacts the environ- ment, therefore it is important that the cannabis industry mitigate VOCs in their processes. — City Of Denver, Public Health and Environment Guide During cultivation, the growth of cannabis plants generates terpene emissions which are associated with a strong odor. After cannabis is cultivated, manufacturing facilities transform the raw plant into various products, 133 including concentrating the oil and plant material. This process is also associated with a strong odor given it requires manipulation of the plant. In California, state law requires that all products arrive at a retail establishment fully processed, tested, pack- aged and sealed in child resistant packaging. Because all products arrive at Embarc retail facilities in their final packaged form, there are virtually no odors associated with this license type. Specifically, per state law, all packaging shall: • Protect the product from contamination; • Be tamper evident and sealed so the contents cannot be opened without destruction of the seal; and • Be child resistant as stipulated by the California Department of Public Health Code Section 40415. Our proposed dispensary will receive, store and sell packaged products in their final form. Consequently, it is highly improbable that any on-site product will emit a strong odor. Nevertheless, this section contains a comprehensive odor management plan designed to ensure odors are undetectable. SECTION 3.5 Describe odor control devices and techniques employed to ensure that odors from cannabis are not detectable beyond the permitted premises. Odor control devices and techniques will be incorporated in all aspects of our facility to ensure cannabis odors are not detectable off-site. Embarc will provide a sufficient odor absorbing ventilation and exhaust system so that odor generated inside the property will not be detected anywhere outside the facility, including the adjacent property or public rights of way, on or about the exterior or interior common area walkways, hallways, breeze- ways, foyers, lobby areas, or any other area available for use by common tenants or the visiting public, or within any other unit located inside the same building as Embarc Fresno. Physical Infrastructure Examples of the physical infrastructure that has been contemplated in the development of a proposed odor plan for Embarc include, but are not limited to, the following: • A reduced path of travel for distributors to transport bulk cannabis goods from the distributor’s vehicle to the inventory room; • Installation of weather stripping on all doors and windows to prevent odor leakage; and, • A sufficiently sized inventory room to allow for all (appropriately packaged and self-contained) products to be unpacked from bulk boxes within the inventory room to ensure that interaction with high volume cannabis products are self-contained. Odor Mitigation Techniques • No Odor-Producing Activities On-Site Embarc will not be conducting any cultivation, testing, packaging, extraction or distribution of cannabis and no noxious fumes or gases will be released. • Carbon Charcoal Scrubber Embarc will use a carbon charcoal scrubber to remove contaminants and impurities using chemical absorption which will prevent odor from escaping the facility. Carbon charcoal scrubbers are an indus- try best practice for effectively neutralizing and mitigating odor from cannabis and other industries. Again, the City of Denver best practices report provides: 134 Carbon filtration is currently the best control technology for reducing VOC emissions from cannabis [facilities] … These filters work by using an absorption process where porous carbon surfaces chemi- cally attract and trap VOCs along with other gas phase contaminants. Depending on the filter system, carbon filtration can remove 50—98% of VOCs … This improves public health and the environmental impacts of the facility. • Air Filtration and Negative Air Pressure Our HVAC consultant will design our air system to maintain negative air pressure between the interior and exterior of the building. The HVAC consultant will follow industry standard procedures that are summarized here, based on a study conducted by the California Department of Health Services and the Lawrence Berkeley National Laboratory: 1. Maintain the interior as depressurized relative to the exterior of the building. Our pressure differ- entials will be between –5 to –7 Pa (–0.02 to –0.03 in. w.c.). Because of this, exhaust efficiencies of at least 90% will be achieved. 2. Air from the commercial cannabis sales area will be filtered and exhausted to the outside without recirculation to other occupied spaces. 3. Increasing the ventilation rate will diminish the concentration of contaminants in any air that happens to leak from the commercial cannabis sales floor to the other areas of the building. We will work with our vendor, Pure N Natural Systems, to procure industry-leading technology to implement the negative air pressure system including the use of the Clean Leaf System. This system captures VOC’s, odors and more. As the air flows through three stages of filtration, it is cleaned of odors. •Biofiltration As a component of Embarc’s commitment to sustainability, we will utilize biofiltration as a component of our broader odor control plans, effectively enhancing odor control efforts. A recent NASA Clean Air Study identified biofiltration as a powerful tool in controlling odors. Through use of “living walls” and beneficial microbes, Embarc will be able to filter indoor pollutants and odors from the air employing a completely sustainable method. • On-Site Odor Neutralization Embarc will utilize industry-leading odor neutralization gel to eliminate odors. Odor neutralizers are different than air fresheners as they are chemically compounded gels that bind to and absorb terpenes, thus eliminating the cannabis smell. By utilizing these products in the inventory room and sales floor, Embarc is providing another layer of odor mitigation. • Ventilation System Our facility will be equipped with a ventilation system to maintain air quality and prevent any cannabis odor from leaving the premises. The ventilation system is designed to control the facility’s environment, taking into consideration the square footage, quantity of cannabis products on site, and any odor-emit- ting activities that occur. Every occupied space will be ventilated by natural or mechanical means in accordance with the International Mechanical Code, International Building Code, and National Fire Protection Association Code. As previously stated, odor control equipment utilized at the facility will include responsible ventilation design and activated carbon filtration technology. • Ventilation Intake Opening The location of air intake openings will comply with the International Mechanical Code. All intake fans will be equipped with UV and insect filters. Air intake openings that terminate outdoors will be protected with corrosion-resistant screens, louvers, or grilles. Openings in screens, louvers, and grilles screens will be sized in accordance with the International Mechanical Code and will be protected against 135 local weather conditions. Outdoor air intake openings located in exterior walls will meet the provisions for exterior wall opening protective measures in accordance with the International Building Code. • Outdoor Air The minimum outdoor airflow rate will be determined in accordance with the International Mechanical Code. Ventilation supply systems will be designed to deliver the required rate of outdoor airflow to the breathing zone within each occupied space. • Air Balancing The ventilation air distribution system will be provided with a means to adjust the system to achieve at least the minimum ventilation airflow rate, as required by the International Mechanical Code. Ventilation systems will be balanced by an approved method. Embarc will maintain air balancing reports in the Facility Maintenance Log. • Negative Air Pressure As detailed above, negative air pressure will be maintained at all time inside the building. We will accomplish this by compartmentalizing the facility and by utilizing negative pressure airlocks. The airtight functionality will create pressure differentials that alleviate the permeation and spread of odors. Furthermore, doors and windows will remain closed at all times, except for the minimum time required to allow people to enter and exit the building. • Exhaust Opening Protection Exhaust openings that terminate outdoors will be protected with corrosion-resistant screens, lou- vers, or grilles. Openings in screens, louvers, and grilles will be sized not less than a quarter inch (1/4”) and not larger than half an inch (1/2”). Openings will be protected against weather conditions. Outdoor openings located in exterior walls will meet the provisions for exterior wall opening protective measures in accordance with the International Building Code. • Duct Systems The ducting systems used for the facility’s heating, air-conditioning, ventilating, and exhaust systems will conform to the provisions of the International Mechanical Code and National Fire Protection Association Code 90A. Ultimately, we commit to utilizing the best available technology, devices, and techniques to eliminate odors and to effectively maintaining these systems to maximize their efficacy. SECTION 3.6 Describe all proposed staff odor training and system maintenance. Staff Training Related to Odor The General Manager will train all employees on odor detection, mitigation, reporting, and general system maintenance as part of the pre-store opening training and on an ongoing basis throughout the lifetime of the business. Additionally, each new hire must complete an odor control training curriculum prior to reporting to work. The General Manager will organize re-training on administrative and engineering activities for odor mitigation at least once a year or following any material change in odor mitigation equipment or policy. 136 Trainings will be conducted in person, using real world examples and hands-on learning activities. All Embarc employees will be trained on the company’s specific administrative and engineering activities for odor mitiga- tion, including but not limited to: • Employee responsibilities • The importance of closing doors and windows • Recordkeeping • System design • Employee observation and reporting • Equipment cleaning • Ensuring exhaust and filtration systems are running as required • Equipment maintenance • Equipment audits and checks Embarc will also hold refresher courses throughout the year to remind employees of best practices for odor mitigation. These refresher courses will be mandatory for all employees. During these trainings, Embarc will stress that odor mitigation is each employee’s responsibility. All employees will be trained to report any odors emitted from the facility or any discrepancies between our operations and our odor control SOP. Embarc will also emphasize the fact that we are members of the Fresno community, and that each employee therefore has an obligation to reduce odors and make a positive impact on the neighborhood. Embarc employee training practices have been proven successful at our dispensary in South Lake Tahoe. Our hands-on experience operating cannabis facilities has taken the guesswork out of developing training protocols, and to date we have experienced no issues with odor management. System Maintenance Plan for Odor Control Because each location is different, there is no one-size-fits-all maintenance schedule for retail operations. Rather, a customized plan is created for each location by the Chief Operating Officer, Vice President of Retail Operations, onsite General Manager, and construction team, encapsulating odor control as well as general facilities maintenance and management. Embarc’s Chief Operating Officer, Terri Gilles, oversees system maintenance, bringing years of operational experience gained at some of the premier cannabis retailers and technology companies in the country. The operational excellence, including precise system maintenance protocols, exhibited at Embarc Tahoe is a testa- ment to our team’s ability to approach system maintenance proactively and efficiently. In accordance with the application requirements, system maintenance includes ensuring the property is prop- erly managing waste and utilizing odor control equipment. However, Embarc is further committed to ongoing preventative maintenance related to waste management and odor control and ensuring proper functionality of all operations as well as aesthetic management of the facility and surrounding area. We will maintain proper system maintenance through the following processes: • At the conclusion of a store buildout, the Chief Operating Officer and Vice President of Retail will schedule a building walkthrough with key members of the construction team to review all components of the facility as well as all warranty and maintenance information. This site inspection and transfer of warranty and other documentation is required of the general contractor before final payment is made and is kept in a binder on the premises. • Upon finalizing the documentation and handover from the construction team and waste management 137 company, the Chief Operating Officer and Vice President of Retail will then meet with the local onsite General Manager to review the binder in detail. During this meeting, the Chief Operating Officer, Vice President of Retail and on-site Manager develop a comprehensive, preventative maintenance schedule. Items requiring maintenance plans include, but are not limited to: • HVAC System Maintenance • Odor Mitigation Infrastructure • Charcoal Filters • Waste Receptacles • General PM Schedule • Smoke Detectors & Carbon Monoxide Alarms • Uninterrupted Power Sources (UPS) batteries for DVR and Network Server Systems • Exterior Camera Cleaning • Exterior Siding • Roof Structures • Landscaping • Pest Control • Plumbing Back Flow & Hydrojetting During this meeting, the team also identifies all relevant contractors and service personnel and initiates contracts to ensure regular servicing. Embarc seeks to retain 100% local service providers, and often utilizes the Chamber of Commerce membership guide as a starting point for identifying service providers locally. In fact, in order for any purchase order or service contract to be approved, the General Manager and/or on-site Manager must assure that the contractor or vendor is based in Fresno. Non-local service providers will only be utilized when the service is not available locally or where warranties dictate the use of a specific entity. Thus, our commitment to utilizing local service providers goes beyond an abstract sense of community. Although each store has different needs, examples of these types of contractors include, but are not limited to, the following: • Landscaping and tree maintenance • Deep cleaning and sanitation services • Pest management • Electricians • HVAC technicians • Plumbing and hydrojetting services To ensure employee accountability and equipment maintenance, Embarc will maintain equipment cleaning and maintenance records which will include, at a minimum, the following information: • Manufacturer information • Date equipment was put into service • Date and time of cleaning or maintenance • Detailed description of cleaning or maintenance • Name of employee who cleaned or maintained equipment • Name of tradesperson, if applicable • Date of required next service Embarc Fresno’s General Manager will be responsible for creating and submitting a monthly odor management report, and we will maintain complete records that will be provided to the Bureau of Cannabis Control and regulators upon request. SECTION 3.7 Describe the waste management plan. Given spatial constraints, below is a brief overview of Embarc’s waste management plan. A comprehensive guide including internal waste management standard operating procedures is available upon request. 138 Overview and Compliance with Laws and Regulations Embarc strictly follows all regulations regarding waste promulgated by the Bureau of Cannabis Control (§ 5054 and § 5048) as such Embarc will not dispose of cannabis goods, unless disposed of as cannabis waste, i.e., the cannabis has been made unusable and unrecognizable in the manner prescribed herein: • Can nabis waste will be stored, managed, and disposed of in accordance with all applicable waste management laws, including, but not limited to, Division 30 of the Public Resources Code. • Can nabis goods intended for disposal will remain on the licensed premises until rendered into cannabis waste. We will ensure that: (1) Access to the cannabis goods is restricted to the licensee, its employees or agents; and (2) Storage of the cannabis goods allocated for disposal is separate and distinct from other cannabis goods. In order to be rendered as cannabis waste for proper disposal, including disposal as defined under Public Resources Code section 40192, cannabis goods will first be destroyed on the licensed premises. This includes, at a minimum, removing or separating the cannabis goods from any packaging or container and rendering it unrecognizable and unusable. This does not require vape cartridges to be emptied of cannabis oil prior to disposal, provided that the vape cartridge itself is unusable at the time of disposal. Cannabis waste on the licensed premises will be secured in a receptacle or area that is restricted to the licensee, its employees, or an authorized waste hauler. Embarc will report all cannabis waste activities, up to and including disposal, into the track and trace system, as follows: If cannabis goods are being destroyed or disposed of, Embarc will record in the track and trace system the following additional information: (A) The name of the employee performing the destruction or disposal. (B) The reason for destruction and disposal. (C) The entity disposing of the cannabis waste. Waste Disposal Locations As noted on the diagram below, the waste disposal location is within the secure inventory vault to prevent diversion. 139 Methods of Rendering all Waste Unusable and Unrecognizable Pursuant to state regulation, all Cannabis Byproducts must be rendered unusable and unrecognizable prior to disposal. Cannabis Byproducts can be rendered unrecognizable by grinding, pulverizing, mulching, mixing, etc. Cannabis Byproducts can be rendered unusable by mixing with other non-cannabis material. The above tasks can be achieved through the use of manual labor or heavy machinery such as commercial/industrial grinders and mixers. Cannabis Byproducts can be rendered onsite or by a licensed third-party cannabis waste handler. Cannabis Byproducts shall be rendered unusable and unrecognizable in a secure location under constant video surveillance. In order to be rendered as cannabis waste for proper disposal, including disposal as defined under California Public Resources Code Section 40192, cannabis goods will first be destroyed on the licensed premises. This includes, at a minimum, removing or separating the cannabis goods from any packaging or container and rendering it unrecognizable and unusable. This does not require vape cartridges to be emptied of cannabis oil prior to disposal, provided that the vape cartridge itself is unusable at the time of disposal. Vendor in Charge of Disposal Embarc has identified Gaiaca as its waste management partner for Fresno. Gaiaca is CESCO, CAC, CMC, CDPH certified and is a leader in cannabis waste disposal as the nation’s first fully licensed, compliant cannabis waste management company. Embarc has partnered with Gaiaca to develop a robust waste management plan 140 that exceeds state and local regulations, which is briefly summarized here and detailed in our comprehensive waste management plan. GAIACA is a highly-integrated cannabis waste management provider with certifications as both a Green Business and Small Business Enterprise (SBE). As the Nation’s first fully-licensed cannabis waste management company, GAIACA’s primary mission is to provide licensed cannabis operators with a compliant, yet sustain- able solution for their regulated cannabis waste. Since 2016, GAIACA has been the preeminent leader in the cannabis waste space, with an expanding footprint in California, Nevada, Arizona, Michigan, Florida, and New York. Their policies and goals reflect conscientious efforts to be environmentally correct, and they are in good standing with the Bureau of Cannabis Control (BCC), the California Department of Food and Agriculture (CDFA), the California Department of Public Health (CDPH), the Environmental Protection Agency (EPA), the California Occupational Safety and health Administration (Cal-OSHA), the Department of Toxic Substances Control (DTSC), and CalRecycle. Gaiaca will service our facility a minimum of 1x per week, or on a schedule developed based on the amount of waste generated onsite to ensure effective waste management. Embarc staff and management will adjust its contract with Gaiaca to ensure the proper removal and storage of all cannabis waste. Prior to final disposal, Gaiaca will ensure all cannabis goods have been destroyed, including removing the product from any packag- ing and rendering it unrecognizable and unusable as prescribed by the Bureau of Cannabis Control in Section 5054 of the state regulations. Waste Removal Rendered: • Cannabis Byproducts that have been properly rendered onsite into cannabis waste can be transported offsite for disposal, or kept onsite for uses including, but not limited to, composting, landfill, and soil amendment. All cannabis waste must be tracked-and-traced to its final location, and a non-hazardous waste manifest, bill of lading, or certified weight ticket issued upon disposal. Non-Rendered: • Cannabis Byproducts that have not yet been properly rendered shall be collected by a Licensed Cannabis Waste Handler for off-site rendering. Since the waste is still considered Cannabis Byproducts, the Licensed Cannabis Waste Handler must follow all rules and regulations applicable to the transporta- tion and handling of cannabis. The cannabis waste shall be Tracked-and-Traced to its final resting place, and a non-hazardous waste manifest, bill of lading, or certified weight ticket issued upon disposal. Waste Management Plan for Unfit/Rejected Cannabis Any cannabis product determined unfit or rejected will be immediately segregated and destroyed by authorized employees only. These employees will adhere to Embarc’s standard operating procedures for the safe disposal of all unfit or rejected cannabis products. Embarc will ensure that all cannabis products that have been subjected to improper conditions are not salvaged but, instead, are properly disposed of in accordance with the rules set forth by all applicable state and local laws, regulations, ordinances, and other requirements. Such improper conditions may include, but are not limited to, extremes in temperature, humidity, smoke, fumes, pressure, age, or radiation. Any cannabis product that fails to meet the needs or preferences of Embarc’s customers will likewise be disposed of properly and compliantly. Our General Manager will determine and document the need for disposal of excess, unfit, or rejected inventory. Unfit or rejected cannabis will be rendered unusable in the same manner as other cannabis waste as detailed above. 141 Recalled Cannabis Embarc will remove recalled product from its website and shelves and place the affected batch in a quarantine state in the locked inventory room. All recalled products that are intended to be destroyed will be quarantined for a minimum of 72 hours. Embarc will affix to the recalled products any bills of lading, shipping manifests, or other similar documents with product information and weight. Embarc acknowledges the product held in quarantine shall be subject to auditing by the Department of Public Health. Following the quarantine period, Embarc will render the recalled cannabis product unusable and unrecognizable and dispose of it in accordance with our standard operating procedures under video surveillance. Embarc will use the track-and-trace database and on-site documentation to ensure that the recalled cannabis products intended for destruction are identified, weighed, and tracked while on the licensed premises and when disposed of in accordance with this regulation. Embarc will enter the following details into the track-and-trace database: 1. The weight and count of the product; 2. The reason for destruction; and, 3. The date the quarantine period will begin. Recycling Embarc’s waste management efforts also contemplate the importance of recycling, both to ensure items such as used vape pens are not readily accessible in trash cans and because it is the appropriate thing to do environ- mentally. As part of our waste management efforts, Embarc will maintain a locked, secured recycling vessel in the secure storage area to facilitate our vape pen recycling program. Customers are encouraged to recycle their old vaporizers and are provided a discount on their next purchase for every vaporizer they recycle with Embarc, whether it was purchased at Embarc or from another dispensary. Conclusion Embarc has developed a comprehensive Neighborhood Compatibility Plan that effectively describes how the CCB will proactively address and respond to complaints related to noise, light, odor, litter, and, vehicle and pedestrian traffic; describes how the CCB will be managed so as to avoid becoming a nuisance or having impacts on its neighbors and the surrounding community; describes odor mitigation practices; identifies potential sources of odor; describes odor control devices and techniques employed to ensure that odors from cannabis are not detectable beyond the permitted premises; describes all proposed staff odor training and system maintenance; and describes the waste management plan. Given spatial constraints, only direct responses, rather than complete plans, were provided herein. We welcome the opportunity to provide additional information upon request. 142 PLANNING AND DEVELOPMENT DEPARTMENT 2600 Fresno Street • Third Floor Jennifer K. Clark, AICP, Director Fresno, California 93721-3604 (559) 621-8277 FAX (559) 498-1026 December 4, 2020 Please reply to: Rob Holt (559) 621-8056 Dustin Moore Embarc 1201 K St, Ste 920 Sacramento, CA 95814 Dear Applicant: SUBJECT: ZONING INQUIRY NUMBER P20-04473 REQUESTING INFORMATION REGARDING CANNABIS RETAIL FOR PROPERTY LOCATED AT 4592 NORTH BLACKSTONE AVENUE, SUITE 103 (APN 428-010-15) Thank you for your inquiry regarding the allowance of new cannabis retail uses. The requested information about cannabis retail uses was analyzed using Article 27, Chapter 15 of the Fresno Municipal Code (FMC) of the City of Fresno. Please note, all research for this inquiry is based on existing land development of the subject property. If there are multiple buildings on the subject property, this research was based on the address provided in the request. This research does not take into effect of future development unless provided in your application request. With that, research of a proposed cannabis retail business on the subject property conveys the following: 1. All cannabis retail businesses must be located on property zoned DTN (Downtown Neighborhood), DTG (Downtown General), CMS (Commercial Main Street), CC (Commercial Community), CR (Commercial Regional), CG (Commercial General), CH (Commercial Highway), NMX (Neighborhood Mixed-Use), CMX (Corridor/Center Mixed- Use), RMX (Regional Mixed-Use), and must meet all of the requirements for development in these zones, including, but not limited to, parking, lighting, building materials, etc. The subject property is zoned CMX , which is one of the allowable zone districts for cannabis retail businesses. Development standards of the CMX zone district are available in Sections 15-1103, 15-1104, and 15-1105 of the FMC. The subject location meets the zone district requirement, per Section 15-2739.B.1.a of the FMC, for a cannabis retail business. 2. All building(s) in which a cannabis retail business is located shall be no closer than 800 feet from any property boundary containing the following: (1) A cannabis retail business; (2) A school providing instruction for any grades pre-school through 12 (whether public, private, or charter, including pre-school, transitional kindergarten, and K-12); (3) A day care center licensed by the state Department of Social Services that is in existence at the time a complete commercial cannabis business permit application is submitted; and, (4) A youth center that is in existence at the time a complete commercial cannabis business permit is submitted. Zoning Inquiry P20-04473 4592 North Blackstone Avenue, Suite 103 Page 2 December 4, 2020 The subject property is not located within 800 feet of the property boundary of any of the above-mentioned uses. The subject building meets the separation requirements, per Section 15-2739.B.1.b of the FMC, for a cannabis retail business. 3. Prior to commencing operations, a cannabis retail business must obtain a Cannabis Conditional Use Permit from the Planning and Development Department per Section 15- 2739.N of the FMC. 4. No more than 2 cannabis retail businesses may be located in any one Council District. If more than 14 are ever authorized by Council (more than 2 per Council District), they shall be dispersed evenly by Council District. The subject property is in Council District 7. There are currently no cannabis retail businesses located in Council District 7. This location requirement is satisfied for a cannabis retail business. Please review the entirety of Article 33, Chapter 9 (Cannabis Retail Business and Commercial Cannabis), and Section 15-2739 (Adult Use and Medicinal Cannabis Retail Business and Commercial Cannabis Business) of the FMC to understand other requirements of cannabis retail businesses, including but not limited to, application requirements, signage, etc. This information was researched by the undersigned per the zoning request. The undersigned certifies that the above information contained herein is believed to be accurate and is based upon, or relates to, the information supplied by the requestor. The City of Fresno assumes no liability for errors and omissions. All information was obtained from public records held by the Planning and Development Department. A copy of the Fresno Municipal Code may be obtained by contacting the City Clerk’s office at 559-621-7650. The Fresno Municipal Code may also be searched on the Internet, free of charge, by going to www.fresno.gov. If you have questions regarding this matter, please contact me by telephone at 559-621-8056 or at Robert.Holt@fresno.gov. Cordially, Rob Holt, Planner III Development Services Division Planning and Development Department Section 4. Safety Plan Overview The below Safety Plan considers possible fire, medical and hazardous situations. Given the RFP stated that com- plete policy manuals are not required at this point in the application process, the below content is intended to only provide relevant responses. We welcome the opportunity to provide the City a comprehensive plan upon request. SECTION 4.1 The Safety Plan shall be prepared and/or assessed by a profes- sional fire prevention and suppression consultant. The following abridged Safety Plan has been developed with the assistance of David Hoover and Bret Tresidder of HYT Corporation and in partnership with Reginald Zellous, a 30-year veteran of the Fresno Fire Department. Mr. Hoover and Mr. Tresidder also have an extensive and exemplary track record in the areas of profes- sional fire prevention and suppression. Founded in 1996, HYT Corporation is a California Small Business firm specializing in fire protection engi- neering, consulting, and design and is a professional fire safety and suppression consultant. HYT Corporation’s service delivery capabilities and experience include, but are not limited to, risk identification and assessment, water supply testing and analysis, fire protection and life safety system evaluation, business continuity evalua- tion, operations, maintenance, and administrative program review and development. Reginald Zellous Mr. Zellous has more than thirty years of firefighting experience, having served as a firefighter and EMT/Paramedic in Fresno since the 1980s before becoming a City of Fresno Fire Captain in 1996. Prior to his career in fire- fighting, Mr. Zellous served as an Aviation Ordinanceman in the United States Navy and as a Firefighter Specialist in Crash Fire and Rescue for the United States Navy Civil Service out of the Naval Air Station in Lemoore, California. Mr. Zellous spent his career controlling emergency response planning, including overseeing research for development of building pre-plans and handling company building fire prevention inspections. He also conducted search and rescue operations, analyzed and responded to medical emergencies, and pre- pared records of company responses to fires and other emergencies. He brings this wealth of experience and knowledge in the City of Fresno to Embarc, providing review of proposed fire and life safety plans as well as playing a role in their implementation and employee training. David W. Hoover Mr. Hoover has a B.S. in Fire Protection and Safety Engineering Technology from Oklahoma State University and has over thirty-five years of experience in the areas of fire protection engineering, assessment, applications, and design. He specializes in the application of fire protection principles and regulatory code compliance concerns to special hazard occupancies and processes. Mr. Hoover has consulted with many types of occupancies and industries including refineries, chemical plants, universi- ties, research laboratories, power plants, and manufacturing facilities. 143 At the request of the California State Fire Marshal, Mr. Hoover served on a special subcommittee to develop criteria for system design and installation parameters for the state’s planned adoption of the fire sprinkler requirements for residential occupancies in the 2010 Building and Fire Codes. Mr. Hoover has provided code consulting for permitting and occupancy, fire protection hazards analy- sis, and design services for new and existing plants, processing facilities, warehouses, manufacturing facilities, and laboratories. His experience includes code compliance assessments, development of fire protection and process safety criteria, fire protection design and consulting for facilities domestic and abroad. He is experienced in fire water supply and distribution systems, automatic sprinkler systems, deluge systems, fire detection and alarm systems, and special hazard suppression systems including foam, halon, bulk dry chemical, and CO2 systems. He has provided consulting services for application of hazardous materials requirements at the federal, state, and local levels. Mr. Hoover recently completed the design of the replacement fire alarm systems for all of the buildings located at the Elmwood Correctional Facility located in Milpitas, California; EBMUD’s high rise administration and building and six EBMUD facilities located at the Adeline Maintenance Center. Mr. Hoover was previously employed as Manager, Fire Protection Services for Crawford & Company, an international engineering and consulting firm. Prior to that engagement, he was a supervising engineer with ABB Impell Corporation. Previous employment includes his services as a project engi- neer for Walter Kidde Fire Systems Operations. He functioned as a safety engineer for two Mobil Oil Corporation refineries (Augusta, KS and Torrance, CA). He also has over 7 years’ experience as a paid and volunteer fire fighter/EMT. Bret B. Tresidder, P.E. Mr. Tresidder has a B.S. in Fire Protection and Safety Engineering from Illinois Institute of Technology and has over thirty-five years of fire protection systems design and assessment experience. His experience includes the design and or assessment of fire detection, alarm, and control systems, fire sprinklers for a broad range of hazards, pre-action systems, gaseous fire suppression systems, AFFF, and low and high expansion foam systems. He has performed fire protection systems assessments, designed fire detection, alarm, and suppression systems for research and laboratory facilities, chemicals plants, manufacturing facilities, warehouse and distribution facilities, mid- and high-rise buildings, and numerous other occupancies. At the request of the California State Fire Marshal, Mr. Tresidder served on a special task force com- mittee to correlate the state’s planned adoption of the 2010 Building and Fire Codes with the various fire suppression standards developed by the National Fire Protection Association (NFPA). This multi-month effort resulted in numerous changes to the planned Codes. Mr. Tresidder has handled a wide range of projects for diverse clients. These projects have involved both new construction and retrofit installations. Mr. Tresidder’s involvement ranges from plan layout, specifications and hydraulic calculations to the application of codes and plan review. Currently, Mr. Tresidder is the fire protection engineer for the analysis and programmed replacement of the combina- tion domestic and firewater distribution and supply system for the California Rehabilitation Center in Norco, California. In addition to Mr. Tresidder’s extensive fire protection design experience, he has recently provided expert witness and litigation assistance in civil actions regarding fire protection system designs and installations, constructability issues, and possible manufacturer’s defect. 144 Mr. Tresidder served as a director of the Placer Hills Fire Protection District, providing fire and emergency response to several communities in Placer County. Mr. Tresidder previously served with the District as a volunteer firefighter and EMT with seven years of active duty. Prior to joining HYT Corporation, Mr. Tresidder was a Fire Protection Engineer with Crawford & Company. Prior to that engagement, he was a Project Manager with Northstar Fire Protection Company. SECTION 4.2 Describe accident and incident reporting procedures. Overview All accidents and injuries including exposure to fire or other hazards that result in injury, illness to employees or customers or damage to property and/or product will be investigated. The investigation is conducted to specifically identify the factors, conditions, and/or practices that contributed to the incident so that planning can occur to prevent recurrence. Minor accidents or near accidents will be investigated as they represent a precursor to potential hazards that could result in serious injury, exposure, or damage. Specific Investigation Procedures All employees are trained extensively on investigation procedures, with General Managers and Managers required to undergo numerous “mock” incident investigations prior to opening the store. These specific investi- gation procedures include: •Immediately assess the scene of the incident •Interview workers and witnesses to record witness statements for the incident •Immediately review security footage—since the entirety of the premises is under surveillance, this is a significant tool in investigating an incident in real time •Examine the workplace for factors associated with the incident •Ascertain the cause •Record findings and make necessary adjustments to prevent future incidents Procedures for Reporting an Incident Immediately following an incident, the General Manager or supervisor immediately completes an “Incident Report Form.” This form must be complete no later than 24 hours after the incident and must encapsulate, at minimum, the following: • Manager name and ID number •Date, time, and location of incident •Names and contact information of any witnesses •A description of the event •Nature and extent of injuries, if any •A description of any first aid performed •Any conditions, methods, or practices related to the incident (e.g., the job function performed by an employee during the incident, if any) As soon as practical, the employee meets with the Human Resources Director to complete the state mandated Department of Industrial Relations Workers Compensation Claim Form provided by Embarc. Additionally, any serious injury or illness that requires inpatient hospitalization for more than 24 hours for anything other than observation, or in which an employee suffers a loss of any member of the body, or suffers any serious degree of permanent disfigurement will be reported, immediately and no later than 8 hours, to the nearest OSHA office. 145 Pursuant to Cal. Code Reg. tit. 16, §5036(a), the Head of Security will notify the Fresno Police Department and the Bureau of Cannabis Control within 24 hours after discovering any of the following: • Significant discrepancies identified during inventory. Note: Pursuant to Cal. Code Reg. tit. 16, §5034, a significant discrepancy in inventory means a difference in actual inventory compared to records pertaining to inventory of at least 3% of the average monthly sales • Diversion, theft, loss, or any criminal activity involving the retail store or any employee • Loss or unauthorized alteration of records related to cannabis goods, customers, or employees • Any other breach of security Pursuant to Cal. Code Reg. tit. 16, §5036(b), notification to the Bureau will be submitted on the Notification and Request Form, BCC-LIC-027, and will include the date and time of occurrence of the theft, loss, or criminal activity, the name of the local law enforcement agency that was notified, and a description of the incident including, where applicable, the item(s) that were taken or lost. Specific Incident Reporting As detailed thoroughly below, employees will be trained to first protect their own lives and then to contact first responders. The first call in emergencies that require an immediate response is 9-1-1. In addition to calling 9-1-1, employees will follow the incident reporting procedures outlined in this document. Fire Emergencies The intended use does not present a high risk of fire. In the case of a fire emergency at the facility, Embarc will employ the response procedure described below. This procedure will be overseen by the onsite General Manager and will be deployed verbally through face-to-face communication with employees and patrons. In the case of a fire emergency, employees will be instructed to immediately call 9-1-1. In the case of a non-emergency (such as a broken sprinkler pipe, etc.), employees will be instructed to call Fresno’s non-emer- gency number at (559) 621-7000. These phone numbers will be posted at conspicuous and appropriate locations within the facility. Employees will be instructed to notify the fire department as the first step in any fire emergency. Employees may attempt to suppress a fire ONLY if: • The Fire Department has been notified. • The fire is small and is not spreading to other areas. • Escaping the area is possible by backing up to the nearest exit. • Personnel are trained in the use of fire suppression equipment, e.g. a portable fire extinguisher. Upon being notified about the fire emergency, occupants must: • Leave the building using the designated escape routes. • Assemble in the designated area (across the parking lot immediately outside the exits). • Remain outside until the competent authority (Designated Official or designee) announces that it is safe to reenter. • Assist all physically challenged employees in emergency evacuation. The primary life safety strategy procedure for evacuating occupants during an emergency will include the training of staff through face-to-face contact with Embarc management relating to the identification of potential emergency scenarios associated with the operation, such as fire evacuation, civil disobedience, earthquake, and/ or medical emergencies. This safety strategy will also include the directing of employees and customers away from the presented hazard and to the closest exit. 146 Customers and those in need of special assistance during an evacuation are of the highest priority and will be escorted to a safe location by staff. Once the building has been evacuated, management will confirm all the occupants of the building are accounted for with an employee headcount plus total number of customers onsite as indicated electronically within our point of sale software. A site plan has been developed identifying the occupancy assembly point, which will be located at the front of the building. Fire hazards associated with normal use and occupancy of the premises may include the accumulation of ordinary combustible storage, such as office supplies, stock supplies, and products. The Building Owner is responsible for the inspections, maintenance and servicing of the fire protection systems, on the annual and 5-year schedule in accordance with California Title 19. Senior staff of Embarc will be responsible for ensuring that their activities do not compromise the proper operation of the fire protection systems (e.g. obstructed fire sprinklers, fire alarm appliances, etc.); that the exiting systems are not compromised by the business activities; and that proper housekeeping is in place to prevent and/or control fire hazards. Medical Emergencies While uncommon, medical accidents and incidents may arise from time to time requiring immediate attention from Embarc team members. In the case of a medical emergency, the onsite Manager will immediately dial 9-1-1 providing as many details as possible to both the operator and first responder(s) and issue appropriate direction to other employees. In the case of a non-emergency medical incident, employees will be instructed to call Fresno’s non-emergency number at (559) 621-7000. Both the emergency and non-emergency phone numbers will be posted at appropriate locations within the facility and all managers and staff will receive ongoing training for how to respond calmly and efficiently in instances of medical emergency. Depending upon the severity of the medical emergency, employees will be instructed to notify the emergency number prior to initiating assistance. This ensures adequate help is on the way. Additionally, and only after contacting the emergency number, employees may, depending upon the severity of the medical emergency: • Ask for individuals on the premises who may be trained in CPR and/or first aid to provide the required assistance prior to the arrival of professional medical help. • Because only trained responders should provide first aid assistance, all Embarc managers will be attend a CPR training class prior to the store opening. • Refrain from moving the victim unless the victim’s location is unsafe. • If personnel trained in first aid are not available, at a minimum, attempt to provide the following assistance: • If bleeding, apply firm pressure to the wound(s) to try and stop the bleeding. Take “universal precautions” to prevent contact with body fluids and exposure to blood borne pathogens (avoid contact with blood or other bodily fluids). • “Universal precautions” include, but are not limited to, the following: • Avoiding contact with bodily fluids such as blood, saliva, vomit, etc. • Wearing protective coverings, such as gloves, face shield, splash glasses/goggles, mouth piece, etc. which will be available at the facility. • If rescue breaths are administered, using a sterile mouth piece. • Thoroughly washing hands after contact. • In instances of choking, attempting to clear the air passages using the Heimlich Maneuver. In addition to these fire and medical emergency procedures, Embarc will employ a detailed Illness and Injury Prevention Program (IIPP) as well as COVID-19 public health and safety protocols that will be available to the City of Fresno upon request given they are too long to be included here. 147 The General Manager and all Managers will receive safety training utilizing these resources with Managers subsequently responsible for training all employees and for utilizing daily, weekly, monthly, quarterly and annual meetings as opportunities for re-trainings. Records of these trainings, including attendees and topics covered during the meetings, must be maintained by the onsite Human Resources manager. Additionally, any employee with knowledge or reasonable suspicion of an incident is instructed to make an immediate report to the General Manager or the Head of Security. The person reporting the incident will complete the Incident Log, which will be maintained on-site at the facility. The General Manager or Head of Security will ensure the following information is collected: • Date and time of occurrence or suspected occurrence • Names and contact information of parties involved and any witnesses • Description of incident • Any evidence supportive of the event • Any other information required to be collected under such circumstances by the City SECTION 4.3 Describe evacuation routes. All Embarc personnel will be trained in life safety strategies and procedures for addressing various types of emergencies, which will include the training of staff through face-to-face contact with Embarc management relating to the identification of potential emergency scenarios associated with the operation, such as fire evacu- ation, civil disobedience, earthquake, and/or medical emergencies. A basic tenet of our safety strategy includes directing employees and customers away from the presented hazard and to the closest exit. Customers and those in need of special assistance during an evacuation are of the highest priority and will be escorted to a safe location by staff. Once the building has been evacuated, management will confirm that all of the building’s occupants are accounted for with an employee headcount as well as the total number of customers onsite as indicated electronically within our point of sale software. A site plan has been developed identifying the occupancy assembly point, which will be located at the front of the building. See the premises diagram below with evacuation routes highlighted. 148 SECTION 4.4 Location of fire extinguishers and other fire suppression equipment. Please see premises diagram below where the location of fire extinguishers and other fire suppression equip- ment is noted. SECTION 4.5 Describe procedures and training for all fire and medical emergencies. Please note that to avoid redundancy, some procedures for fire and medical emergencies are listed in Section 4.2 above. Employee training is paramount in all aspects of our business, but we place an extra emphasis on training related to fire and medical emergencies in order to provide a safe and healthy workplace for our employees and customers. Embarc acknowledges that it bears the ultimate responsibility for training related to responses to fire and medical emergencies which is intrinsically linked to our safety and security plans. The management/ownership team will delegate these duties to an onsite Security Director, as well as specific roles and responsibilities for the General Manager as outlined and identified in this document. In times of crisis, all employees must play a part in protecting public health and safety, which is why this training is mandatory for all employees. The Security Director will ensure that all employees understand their respective roles and responsibilities including the chain of command in the event of any incident. The Security Director will also train the General Manager on his or her duties in the case of fire, life or other security emergencies. 149 Employees at all levels will be trained to: • Identify threats and vulnerabilities • Implement mitigating strategies • Understand when and why they could be targets, and • How to respond accordingly Staff will be tested no less than semi-annually regarding their knowledge of the premises’ fire, life safety and security strategies. Development of policies and procedures will be ongoing during and after the initial planning process. Embarc’s Head of Security will continuously audit the plan as the business evolves and will ensure appropriate training of employees as new procedures are implemented. To demonstrate that the employee understands the content of training delivered, all employees will be required to undergo an assessment. Assessments will include, at minimum, a hands-on demonstration by the employee as it relates to fire and life safety and security policies and procedures included in the training. Embarc will conduct quarterly drills at the premises to ensure that all employees understand how to respond to various emergencies or threats at the premises. Fire and life safety drills, and armed robbery and burglary discovery drills are examples of drills that may be conducted on the premises as part of comprehensive security training. We employ both internal and external trainings related to fire, medical and security emergencies. Mandatory Personnel Training—External Externally, managers and employees participate in a 30-hour OSHA training course from an authorized OSHA Training Institute (OTI) Education Center. The course teaches safety awareness which helps in recognizing and reducing the risks of job site hazards. This interactive training covers safety and health hazards workers may face on work sites. The course places emphasis on hazard identification, avoidance, control and prevention. Upon successful completion of the course, employees receive a 30-Hour Cal/OSHA General Industry Outreach course completion card. This course covers: • Electrical Hazards • Exposures to Airborne Contaminants • Flammable Liquids and Gases • Hazard Communication • Hazardous Energy—Lockout/Tagout • Heat Illness Prevention • Injury and Illness Prevention Program • Machine Hazards • Personal Protective Equipment • Point of Operation Hazards • Pressure Vessels • Prohibition of Smoking in the Workplace • Repetitive Motion Injuries • Sanitation and Pest Control • Slips, Trips, Falls and Use of Ladders Mandatory Personnel Training—Internal Internally, Embarc maintains an Emergency Action Plan that all employees are trained on for handling emer- gencies, including evacuating employees, providing emergency medical attention and reporting emergencies to employees and community agencies. A complete copy of this training is available upon request by the City of Fresno. The plan includes: 150 • Means of reporting • Evacuation procedures and emergency escape routes • Procedures for critical operations • Accounting of employees • Rescue and medical duties • Contact persons Embarc thoroughly trains employees on this plan when they are hired or when there are changes to the plan. The plan is reviewed with employees during the: • Initial assignment of employee to job • Changes to plan or employee actions/responsibilities Annual retraining including drills are conducted to practice evacuation and gathering in the assembly area and ongoing education and training is conducted on types of emergencies, courses of actions, functions and elements of the EAP, special hazards, and fire hazards and fire prevention plan. General training includes: • Roles and responsibilities • Threats, hazards, protective actions • Notification, warning, communications • Location/use of emergency equipment • Procedures • Emergency response • Evacuation and shelter-in-place • Assembly and accounting of employees • Emergency shut-down of operations Employees are certified annually and are required to complete the training as many times as required to suc- cessfully pass. Additionally, employees are trained annually in general fire safety by our life safety consultant with general fire safety practices that include: • No smoking or consumption of cannabis onsite the premises • No storage of combustible materials in buildings • Storage will be separated from heaters or heating devices by distance or shielding so that ignition cannot occur • Reporting of emergencies • Coordination with emergency response forces • Emergency plans and procedures for managing or responding to emergencies • Emergency evacuation drills • General Managers and managers are required to be trained in CPR. Additionally, security training is a critical component of a life safety plan. Thus, all employees working in the premises will complete introductory training relating to facility security prior to engaging in any occupancy or work on the premises. Training will include, at minimum, the following: • Operation of security equipment within the scope of role(s) • Inspecting and monitoring security equipment within the scope of role • Emergency notifications, response and reporting procedures • Effective patrolling of the premises • Identifying opportunities for diversion • Securing the premises and assigned work areas • Critical incidents, situational policies and procedures • Proper method for securing cannabis and currency at the end of each workday 151 City Engagement Embarc welcomes the opportunity to solicit feedback from the Fire Department, Police Department and any other pertinent stakeholders in the implementation of this safety plan. As with all Embarc locations, Fresno Police and Fire Departments will be invited to tour the facility prior to opening to ensure open communication, a clear understanding of Embarc’s intended operations, and to facilitate introductions to Embarc Fresno’s General Manager and management staff. This has proved tremendously valuable in South Lake Tahoe, where clear and open communication between Embarc and the Police Department has facilitated collaboration on a number of occasions including the use of Embarc captured security footage in the pursuit of an unrelated incident. For these purposes, Head of Security Matt Carroll will be the primary contact, with Head of Community Engagement Steve Hosey and the General Manager also available at any time. Conclusion This safety plan considers possible fire, medical, and hazardous situations, was prepared by a professional fire prevention and suppression consultant, and describes each of the following: • Accident and incident reporting procedures • Evacuation routes • The location of fire extinguishers and other fire suppression equipment • Procedures and training for all fire and medical emergencies This is not our exhaustive plan but rather was designed to respond to the City’s prompts. Embarc will gladly provide a more thorough plan upon request. 152 Section 5: Security Plan 153 Section 2. Social Policy And Local Enterprise Plan Overview Embarc’s social policy and local enterprise plan demonstrates a meaningful commitment to this community, embodied in Steve Hosey’s decades-long leadership in Fresno and Embarc’s track record of strong labor practices as evidenced in existing operations. Embarc’s commitment to labor partnerships and the creation of a workplace that aligns with our employee’s values is not just a promise made for the purposes of this application, but rather is embodied in our existing efforts and further indicative of our community-based ethos. Embarc lives its values through action —providing wages that are among the highest in the industry and a plethora of industry-best benefits for our 100% local workforce. We are committed to diverse and inclusive hiring and are dedicated to investing in our employees by creating a myriad of opportunities for career growth. We are proud of our professional development opportunities and prioritization of ongoing education through training, workforce development, financial literacy, tuition assistance, incubator partnerships, inclusive recruit- ing and hiring practices and true ownership via our Employee Stock Ownership Plan that will make every employee an owner of Embarc. We understand the importance of education and prioritizing employment for historically disenfranchised residents. We are confident in our hiring plan and will utilize our local partnership with the Fresno Economic Opportunity Commission (EOC) as well as higher education institutions and the United Food and Commercial Workers to ensure we are engaging citizens most impacted by the War on Drugs, including low-income communities and communities of color, and providing them with meaningful opportunity in this burgeoning industry. Embarc shares the values of organized labor and is in the final stages of negotiating our Collective Bargaining Agreement (CBA) with the United Food and Commercial Workers Union (UFCW). As part of our CBA, some benefits will also extend to our employee’s dependents, which is critical now more than ever as COVID-19 has created economic insecurity for many families. Embarc is committed to the development of local economic opportunities for residents, significant ongoing community benefits, and to true partnership with the City and its residents. As detailed in their proposal, the Company has committed to 100% local hiring, a living wage, meaningful benefits and opportunities for advancement within the company. It is these commitments that ensure employment at Embarc will provide for local workers and their families, allowing the Company’s workforce to be —and remain —truly local. To demonstrate this commitment to their workforce, Embarc is currently working with UFCW to secure a Collective Bargaining Agreement across all locations. This is indica- tive of the Company’s values and just one of the reasons we fully support their application. Jacques Loveall , President, Ufcw Local 8—Golden State Our partnership with the United Food and Commercial Workers Union extends beyond just providing a living wage and meaningful benefits to our employees. It also drives workforce development, opportunities for ongoing education, community support and a commitment to equity through free community workshops, expungement clinics and social equity incubation. We are committed to creating high paying jobs with career growth opportunities and are prepared to do so in Fresno given our proven track record in other communities. Through our extensive community partnerships with leading non-profit and community organizations in Fresno, as well as the guidance of our Community Advisory Board members (detailed in Section 7), we welcome the responsibility and are enthused at the pros- pect of playing an active role in creating a local, equitable, Fresno-first cannabis industry. 99 SECTION 2.1 Describe whether the Commercial Cannabis Business is com- mitted to offering employees a Living Wage. One demonstration of Embarc’s commitment to living its values through action is our wages, which are among the highest in the industry. Embarc will continue to provide a competitive living wage as a base wage for hourly employees and a generous salary for management positions. While many of the state’s largest operators pay between per hour, Embarc’s current retail employees are paid between an hour, depending on the role and experience level. Embarc would offer these same industry-leading wages to its Fresno employees, which will be encapsulated in our Collective Bargaining Agreement with UFCW. While we have a Labor Peace Agreement (LPA) for the purposes of satisfying the application requirements, Embarc is currently finalizing its Collective Bargaining Agreement (CBA) with United Food and Commercial Workers Local 8 —Golden State. Our CBA is anticipated to be finalized in December of 2020 and will then be expanded across all stores as we continue to grow. Given this timeline, we believe it will be in place prior to Fresno licenses being awarded. SECTION 2.2 Briefly describe benefits provided to employees such as health care, vacation, and medical leave, to the degree they are offered as part of employment. We understand that in today’s world, employees need and value flexibility more than ever. To the greatest extent possible, our benefits program and day-to-day operations are designed to provide every employee with the opportunity to maximize their employment and benefits. The following details Embarc’s benefits, contemplating both traditional health and wellness benefits as well as Embarc programs designed to empower our employees. Health and Wellness Benefits All Embarc team members will be eligible for our robust benefits plan after 90 days of employment. The following details benefits specific to health and wellness. Health, Vision and Dental All employees will be offered a competitive benefits package that allows them to choose from various health, vision and dental insurance programs to best meet their needs. Embarc contributes significantly to these programs to reduce out-of-pocket costs, including a healthy savings account. Paid Time Off Work life balance is a critical ingredient of maintaining a happy and productive workforce. With the instability wrought by COVID-19, we recognize the need for flexibility now more than ever before. Employees are offered industry-leading paid time off, with accrual based on duration of employment and as many as twenty-five (25) days per year based on tenure. Additional leave includes: • Bereavement Leave • Ju ry Duty and Witness Leave • Time Off to Vote • Family Leave • Pregnancy Disability • Victims of Crime Leave 100 • Domestic Violence • Sexual Assault or Stalking Leave and Accommodation • Civil Air Patrol Leave • Military Leave • Military Spouse Leave • Organ and Bone Marrow Donor Leave • School and Child Care Activities Leave • Volunteer Civil Service Personnel • Sick Leave • Disability Leave COVID Leave Specific to COVID, any employee that presents symptoms is immediately sent home to be tested and are provided two weeks of paid time off to rest and recover. We adopted this policy in June, demonstrating our commitment to our with employees prior to a legislative mandate on this issue. Free Counseling Embarc believes in the importance of both mental and physical health and wellbeing. This year has been overwhelming for many, especially those serving as essential workers during this global pandemic. As part of our comprehensive healthcare package, all employees are eligible for employer-paid mental health counseling from an independent healthcare professional. Tuition Assistance and Scholarship Program We offer tuition assistance and a scholarship program for qualifying employees. Life Insurance Embarc offers 100% employer paid premium life insurance policies. Transportation Assistance While we will have ample parking, Embarc will provide staff with complimentary bus passes as needed and will install bike racks to encourage non-vehicular commuting. Embarc Cares —A Fund for Team Members in Need Now more than ever, living our values means being a conscientious employer and supporting our employees inside and outside the four walls of our business. To that end, Embarc has established an Employee Assistance Program to provide emergency grants for employees in times of crisis. The purpose of the fund is to assist team members in coping with unexpected hardships that place undue financial stress on them and/or their immediate family, either due to a qualified disaster or personal hardship. These awards are based on financial need and the severity of the disaster or emergency. Importantly, these are not loans that must be paid back but monetary grants we provide to address the economic impacts of the issue and help our team members feel stable and secure rather than overwhelmed. Thus far we have found that this grant program has made a meaningful impact on the lives of employees, creating a more open line of communi- cation between the team and providing a tangible demonstration of our commitment to the well-being and lives of the Embarc team. Misc. Benefits Other benefits include but are not limited to a pet adoption stipend for local adoptions and significant employee discounts. Empowering Our Team We believe empowerment is one of the most important benefits an employer can provide to their team. Below are examples of Embarc’s commitment to investing in the empowerment and development of our employees. 101 Employee Stock Option Program (“ESOP”) We have set aside 10% of the company’s equity to provide every full-time employee a minimum of 10% of their annualized salary in stock options and grants. While a few cannabis operators have allocated nominal stock to employees, we are not aware of any that have made such a meaningful contribution. This is a direct reflection of how we view the team—as partners in bringing this vision to life. Financial Literacy Embarc is invested in our employees’ futures. Research has shown that employees often do not contribute to retirement or participate in the stock market due to a lack of understanding. Embarc believes that providing financial education is part of a robust and well-rounded benefits program. This financial literacy education was developed by our Chief Financial Officer and is part of the employee training and on-boarding process, covering how stock options work and how to maximize their benefit, budgeting and saving, taxation, retirement planning and related financial concepts. Embarc on Community: Employer-Paid Volunteerism There are few things that feel better than doing a good deed, except maybe doing it with your peers while getting paid. Embarc is committed to providing a rewarding and positive workplace that encourages employees to give back to their community. Partnering our workforce with community organizations that are partners to Embarc in the City of Fresno will develop a sense of pride and a culture of volunteerism among our employees. As such, Embarc employees will be afforded paid time off at their regular rate of pay to participate in local community support activities and programs through the Embarc on Community Program. Specifically, Embarc commits to providing 40 hours of paid community service per employee per year. Given we anticipate employing approximately 20 employees, this will result in more than 800 paid volunteerism hours per year per retail store, coupled with the ongoing volunteerism of our local HQ and corporate leadership teams which brings this total to over 1,000 hours a year. While volunteering is the right thing to do and an important component of our ongoing partnership with local community organizations, these opportunities for engagement also provide employees with tools for profes- sional development. Furthermore, investment in employees also reduces turnover and improves workplace performance. Research shows that the best way to achieve employee participation in paid volunteerism is to provide struc- tured opportunities on an ongoing basis where employees are able to measure the results of recurring partici- pation. Accordingly, our goal is to achieve a 100% employee participation rate in our Embarc on Community Program, ensuring employees are giving back while also: • Learning new skills • Gaining project management skills • Growing personal and professional networks • Creating a positive presence in our community • Participating in off-site team building with purpose We will provide consistent and meaningful volunteer support to our community partners in order to ensure our team is directly involved in the success of our community. These are not one-time commitments for a few hours of trash pickup; rather, this is an ongoing, dedicated commitment to community partners that are making a tangible impact in our communities. 102 In South Lake Tahoe, some of our partners include the Boys and Girls Club, the Coalition for the Homeless, and the Drug Free Coalition. We will partner with similarly impactful organizations across Fresno and have already initiated discussions with a handful of key community groups to achieve that goal, including those addressing neighborhood needs food insecurity, workforce development, human trafficking, and more. SECTION 2.3 Describe compensation to and opportunities for continuing education and employee training. Compensation for Continuing Education and Training Embarc understands that when employees gain additional education and training, whether specific to cannabis or simply as part of ongoing personal and professional growth, Embarc ultimately benefits from a more well- rounded and professional staff. As such, Embarc compensates employees for ample onsite and offsite training and education programs such that there is no economic barrier to ongoing betterment for our team and to ensure professional development is prioritized, effective, and provides the foundation for future leaders in the cannabis industry. • Upon hire, employees undergo a rigorous, immersive paid training program for two, three or four weeks, depending on the role • To maintain best-in-class product knowledge, employees receive daily, quarterly and annual paid educational trainings • Employees are provided paid opportunities to serve as mentors in educating new hires and for ongoing all-staff trainings —for example, in our Tahoe operation, multiple employees expressed interest in leading product education and terpene exploration classes, so they were paid to work with the Embarc team to develop this curriculum and then paid to teach it to all employees, who were also paid for their time to be trained While internal training is critical to customer service, opportunities to broaden and sharpen our employees’ skills outside the shop are vital as well. Our operating budget contemplates a significant monthly allocation for educational tools, trainings and other resources to enhance team members’ experiences in executing their core professional functions, and our partnerships with educational institutions and community groups such as Fresno EOC will ensure we are able to provide ongoing soft skills training. In the past three months alone, Embarc team members have been paid to participate in educational courses provided by licensed or otherwise recognized third-party institutions on the following: • Diversity and inclusion • Human Resources best practices • Leadership • Sales and Customer service Embarc has afforded me many opportunities to learn and grow inside and outside of the shop. As a manager, it is important I continue to cultivate leadership skills that ensure I am the best leader I can be. Embarc recently provided me access to a leadership skills training that has given me new tools to effectively lead our team. I appreciate the opportunities I am offered to expand my knowledge through Embarc-led and third-party educational activities and resources and I’m proud of what I’m able to put into action in engaging our team in new ways. Melissa S., Manager at Embarc 103 Opportunities for Continuing Education and Training A well-trained workforce is vital to creating a unique, differentiated experience for customers and is thus key to a successful operation. It is important for our employees to embody the motto “Own Your Store.” In practice, this means that team members have gained the skills and knowledge to make decisions in the best interest of the business and the confidence to execute them, thus “owning” the store’s successful approach to community and customer engagement. Developing team members such that they are equipped to feel ownership over the store requires significant ongoing training and education that is tailored to each role and location. We recognize that not all employees join the team with all of the skills or training they need to succeed. In every community where we operate, we seek to partner with local educational institutions and trusted commu- nity leaders and organizations to create meaningful workforce development partnerships. It is important that we localize the approach rather than adopt a one-size-fits-all partnership to ensure that we meet the unique needs and priorities of each individual. Embarc will utilize the following strategies and partnerships to provide continuous education and training programs to our employees: • Embarc’s proprietary four-week, three-week and two-week cannabis training to onboard General Managers, Managers and all staff. • Embarc’s collaboration with higher education institutions such as the State Center Community College District to provide ongoing professional skills development. • Continuous professional development education available to all employees on a monthly and quarterly basis through our local partnership with vital workforce development organizations including Fresno EOC. • Compass, Embarc’s internal mentorship program, designed to create meaningful opportunities for professional development within and outside of Embarc. • Consistent employee feedback and management reviews to ensure our employees understand their performance and paths and career growth and are receiving any additional tools such as soft skills training that are required to ensure success. • Tuition assistance and scholarship opportunities for qualifying employees. • Embarc’s apprenticeship and incubation programs, detailed later in this section. Proprietary Training As detailed in Section 1, Embarc provides a minimum of two weeks of paid training as part of our proprietary onboarding process, as well as between one and two additional weeks of immersive training in another Embarc store for all General Managers and Managers. Higher Education and Workforce Development Partnerships Embarc has established workforce development partnerships with the local community colleges in commu- nities throughout Northern and Central California. In Fresno, we have the opportunity to work with Fresno Community College to provide ongoing training opportunities for employees outside the four walls of Embarc. Understanding the importance of educational institutions in providing ongoing education and training opportunities, Embarc is enthused that Lucy Ruiz, Vice President of Government Relations at State Center Community College District and Carole Goldsmith, President of Fresno City College, have agreed to serve on our Community Advisory Board. In this capacity, Lucy and Carole will guide Embarc’s efforts to create long-term opportunity for continuing education for all employees. Embarc will leverage these relationships with higher education institutions and its workforce development partnership with EOC to achieve multiple goals: 104 1. To provide real world work experience for those over the age of 21 through workforce development pipelines into Embarc; 2. To provide opportunity to leverage the skills and experience of our corporate leadership team to assist the community college and local non-profit(s) with workforce development programs and workshops; and 3. To provide additional resources to our team members to promote advancement. Focus areas for these partnerships include, but are not limited to, the following: • Professional work habits • Relationship development • Identifying personal goals • Overcoming obstacles on the job • Transferable skills • Employability and other soft skills Embarc has partnered with EOC to ensure diversity in our recruitment efforts as well as to provide opportuni- ties for continuous education and professional development for our employees, including soft skills training and individualized counseling for those re-entering the workforce. Compass: A Mentorship Program to Build Opportunity from Within Another critical component of successful workforce development is the creation of meaningful mentorship within the company such that employees are able to learn and grow within the organization. Mentorship programs help to develop future leaders by teaching new skills and providing diverse experiences that create mobility for future roles at Embarc and beyond. It is also a meaningful way to welcome new team members into the fold and to facilitate relationships across stores and experience levels. Embarc has implemented a mentorship program that pairs entry-level employees with more seasoned team members to cultivate passions and provide meaningful feedback on how to continue professional development and growth. This program is designed to break down barriers to entry, provide consistency in feedback and professional development, and help employees identify other areas of interest to promote matriculation. We understand that while someone may currently work as a Guide (sales associate), he or she may have larger career ambitions at Embarc or beyond. We foster the development of our team internally, providing them with the tools, guidance, resources and skills necessary to advance. Upon hiring, employees are given the oppor- tunity to apply for a mentor. Mentors are assigned based on the mentee’s interests, skills, and desired growth trajectory. Subject areas for mentorship include: • Buying and Sourcing • Community Building • Community Engagement • Compliance • Culture and Team Building • Design • Education • Eve nt s / PR • Finance • Human Resources • Inventory Control • Marketing • Merchandising • Operations • Sales • Social Media While our core business focus is retail, it takes a team with diverse skills and experiences to build and sustain an effective business. By offering a mentorship program, we are investing in our employees as more than “just” retail associates—they are vital team members with the potential to learn and grow into all facets of the company, from store level management to corporate operations. Furthermore, working at Embarc has the potential to be more than a job—we provide meaningful career opportunities with significant wages, benefits and opportunities for advancement in each store, in multi-store leadership positions, and company-wide. 105 Career Advancement Embarc will promote from within by matriculating employees from associate to management through ongoing training, quarterly performance reviews and annual meetings. When submitting a job requisition form to Human Resources, Embarc employees are required to take an “Our Team First” approach. This approach requires Human Resources and the individual requesting a new position be created (or a current position be filled) to discuss internal team members that could be appropriate for the role before any outside recruiting efforts are made. Jobs are posted in each retail store for a minimum of five days before being posted externally to ensure our staff is aware of new opportunities and able to pursue them if interested. This is a collaborative and comprehensive process between Human Resources and the department leads seeking the role to be filled, designed to prioritize upward mobility from within. When an employee is identified as the right fit for the role, Human Resources engages that employee to determine his or her interest in the new role before undertaking any external recruiting practices. Consistent Feedback —Regular Performance Reviews While most employers rely on an annual review process, Embarc performs quarterly performance reviews and further encourages employees and supervisors to discuss performance on a frequent, ongoing basis. Data indicates that employees often feel uncomfortable asking for performance feedback, but quarterly reviews eliminate that barrier and create a culture of ongoing communication about performance, opportunities for improvement, and upward mobility paths. Consistency in communication also normalizes discussion of opportunity ladders and compensation which is vital to promoting Embarc’s “Our Team First” hiring policy. These reviews also provide opportunities for the manager and team member to explore areas where additional training or education could be helpful in promot- ing growth, and then creating a plan for how to meet those education and training needs utilizing both internal and external resources as appropriate. Tuition Assistance and Scholarship Program Per Section 2.2, we offer tuition assistance and a scholarship program for qualifying employees, as well as provide scholarships to local residents in coordination with local community colleges. For example, in South Lake Tahoe, Embarc not only provides scholarships for students from the LGBTQIA+ community, but also supports the student food bank to address food insecurity. We are grateful for Embarc’s commitment to supporting the students of Lake Tahoe Community College through scholarships and workforce development opportunities. These make a tangible impact in the lives of students. Professor Walter Morris, Ph.D., Board Member, Lake Tahoe Community College Foundation SECTION 2.4 Describe the Commercial Cannabis Business plan to recruit individuals who meet the criteria listed in the Social Policy Section 9-3316 (b) (1) of the Fresno Municipal Code (FMC) and the percentage of local employ- ees it hires. Overview Diversity in backgrounds, experiences and perspectives is critical to a company’s culture and its ability to 106 effectively meet the needs of diverse clientele. As such, Embarc is committed to developing and maintaining a diverse workforce by recognizing the barriers to entry for impacted communities, seeking to remove those barriers, and meeting each team member exactly where they are —providing the additional education, training and support necessary to grow into who they want to be. A diverse team begins with recruiting and hiring diverse candidates. Embarc is committed to ensuring individuals most impacted by the failed War on Drugs are prioritized when seeking employment in the legal cannabis industry. Specifically, Embarc is committed to ensuring at least 50% of our workforce is com- prised of individuals who meet Social Policy 9-3316 (b) (1) of the Fresno Municipal Code and 100% are local residents. Furthermore, we will place priority on hiring individuals who participate in social equity incubation, whether through participation in Embarc’s incubation program or through participation in another incubation program. This ensures a jobs pipeline exists for these individuals within Fresno’s burgeoning cannabis retail industry. Specifically, Embarc commits: • At least 50% of its local workforce will be local Social Equity qualifying residents • 100% will be local residents Embarc’s plan for recruiting employees that qualify under Social Policy 9-3316 (b) (1) of the Fresno Municipal Code is predicated on leveraging our strong partnerships with local community groups and organizations that already engage these populations, coupled with more traditional mechanisms including job fairs, social media outreach, etc. This approach is critical for a few reasons — 1. First, it amplifies the efforts of local workforce development organizations by providing an ongoing jobs pipeline for their participants; 2. Second, it allows an applicant to maintain dignity in the hiring process because they are pre-screened through these partners as qualifying and thus do not have to “check the box” regarding income and/or previous criminal history when applying at Embarc; and 3. Finally, it ensures we are engaging in legal hiring practices given many labor and employment laws prohibit us from inquiring about income and eligibility status when hiring. Inclusive Hiring Inclusivity is about more than who you hire; it requires contemplation of a variety of opportunity barriers. Our outreach occurs through multiple platforms and across non-traditional channels as well as via job fairs and through workforce development partnerships with UFCW and local non-profit organizations such as Fresno EOC. These partnerships are critical given many program participants must meet low-income or previous conviction requirements in order to participate, thus ensuring an applicant qualifies under the City’s definition for social equity. Our outreach is mobile optimized given technology barriers for some low-income individuals. As a female owned small business, I am thrilled to work with the Embarc team on their recruiting efforts. Embarc embodies their values, including a focus on hiring women and people of color across every aspect of their business. Embarc is an example of the type of values-driven employer I’m excited to see in the cannabis industry. Edith Villaseñor, Owner, Villa Flora Recruiting Much of Embarc’s diversity in hiring practices are built from the foundational principles of Root and Rebound’s “California Fair Chance Hiring Guide for Cannabis Companies” as well as the University of California, 107 Berkeley’s “A Toolkit for Recruiting and Hiring a More Diverse Workforce.” Root and Rebound is an advocacy group operating in California and beyond whose mission is to restore power and resources to the families and communities most harmed by mass incarceration through legal advocacy, public education, policy reform and litigation —a model rooted in the needs and expertise of people who are directly impacted by the War on Drugs and other mechanisms for marginalization. Root and Rebound’s guide for cannabis companies provides best practices for diverse and inclusive hiring, which serves as a guide for Embarc’s best-in-class operational policies. Cornerstones of Root and Rebound’s Guide are as follows: Be a “Ban the Box” (i.e. Fair Chance) Employer History has proven that inequitable enforcement of drug policies has been wielded as a tool to criminalize low-income communities and communities of color by creating a generational cycle of disenfranchisement and imprisonment. The War on Drugs has left a legacy in communities that contin- ues to plague the victims of cannabis criminalization and future generations, driving racial inequalities throughout the criminal justice system that can have lifelong consequences. Within the bounds allowable by local and state laws regarding cannabis employment background check requirements, we hire those others may not through our support of ‘ban the box’ employment practices that provide opportunity to non-violent cannabis offenders. This policy has a net benefit for Embarc, creating a team with diverse backgrounds and experiences that informs our ability to think differently and problem solve creatively. Job postings include the following: Embarc is an equal opportunity employer. All qualified applicants will be considered for employment without unlawful discrimination based on race, color, creed, national origin, sex, age, disability, marital status, sexual orientation, military status, prior record of arrest or conviction, citizenship status, or current employment status. Embarc values diverse experiences, including with regard to educational background and justice system involvement. People with criminal justice records are encouraged to apply. We depend on a diverse staff to carry out our mission. Engage Pipelines to Fair Chance Workers Embarc works with UFCW, affinity groups, community partners, non-profit organizations and local educational institutions including community colleges to create a jobs pipeline that engages workers of diverse backgrounds. One example includes our partnership to post all available positions on the Cannabis for Black Lives job board. Create a Diversity Policy Embarc has created a diversity policy, both as a lived value reflected in our Code of Conduct and as a commitment to the continued diversification of our team. Specifically, we commit to the following: Embarc will commit to hiring 100% locally, with a goal of 100% of our workforce comprised of a qual- ified pool of local candidates from underrepresented groups, including females, BIPOC, seniors, people of color, those with a prior non-violent cannabis offense, and members of the LGBTQIA+ community. We rely heavily on our partnerships with leading advocacy networks representing these communities to effectively engage target populations to achieve that goal. Workforce Development Partnerships Embarc has a proven track record of engaging workforce development experts and entities in the creation of meaningful educational training and opportunities. Our partnership with UFCW is about more than just job fairs —our employees are afforded ongoing education and training opportunities to develop and hone skills needed for careers in cannabis and beyond. These are just some examples of how workforce development is a critical component of engagement with employees and the community. 108 Offer a Structured Orientation and Onboarding Program To succeed in such a highly regulated industry, all Embarc employees must undergo extensive and highly structured orientation and onboarding as well as ongoing training throughout their careers with Embarc to ensure compliance, protection of public health and safety, and superior customer education and service. Embarc’s training program is not haphazard; rather, it has been created by nearly a dozen executives with decades of combined experience in cannabis and beyond focused on best-in-class retail teams. Plan to Recruit Individuals Who Qualify as Social Equity Our recruitment efforts build on these best practices and will begin approximately four months prior to open- ing, with a first focus on senior store leadership. Approximately three months prior to opening, recruitment will begin for non-managerial retail employees. Embarc will meet with different community groups throughout Fresno including the Fresno EOC, Equality California and our partners in higher education about locating qualified individuals from underrepresented groups and helping to create economic opportunity for them through job training programs and educational grants. To ensure an effective hiring plan targeted at achieving our 50% commitment to hiring those who qualify as social equity, Embarc will support, partner with, and hire from organizations working to address the impacts of the failed War on Drugs and other marginalization, including, but not limited to, the following: The Clean Slate Program —Embarc will work with Fresno County’s reentry program to proactively identify potential candidates. The Clean Slate Program provides free legal services to indigent and low-income persons convicted of offenses in Fresno County eligible for record clearance. The Clean Slate Program also connects eligible participants to services, which assist with healthcare, employment training and housing access. 70 Million Jobs —Embarc is establishing a partnership with 70 Million Jobs, a national organization connect- ing employers with formerly incarcerated individuals seeking employment. We will post all of our job openings on their network in an effort to provide career opportunities to those most impacted by the war on drugs. With 70 Million Jobs, Embarc is able to limit the geographic intake to only Fresno and can tailor to individuals specifically incarcerated for minor drug offenses. All applicants will be required to pass a background check for otherwise prohibited records prior to employment. Employment Transition Services —Homelessness is an issue faced by communities across California. As a local employer, we will help to ensure local residents seeking work have the opportunity to learn about opportunities at Embarc. Upon being awarded a permit, Embarc’s Head of Community Relations will work with the City of Fresno and our non-profit partners (see Section 7 —Community Benefit) to provide direct assistance to those transitioning into the workforce. Embarc commits to being an engaged leader on the issue of homelessness and looks forward to working with the City on how to best channel its efforts to maximize the City’s existing efforts. Cannabis for Black Lives —Embarc will post all job opportunities at Embarc retail and corporate levels on the Cannabis for Black Lives job boards specifically tailored to African American individuals interested in the legal cannabis industry. Villa Flora Recruiting —Embarc has a successful track record of hiring efforts contracted through a small business owned by a female of color. Her outreach prioritizes recruitment efforts through traditional and non-traditional forums, including direct outreach to female and BIPOC-centric professional networks and organizations to ensure a diverse hiring pool. 109 Fresno Cannabis Incubators —Embarc is committed to the creation of an incubation program to create career pathways for social equity qualifying individuals and will leverage many partner organizations and outreach channels to recruit qualifying individuals. In addition to our internal efforts, we will also seek to partner with other incubators to provide apprenticeship and employment opportunities to those participating in social equity programs throughout the City. This increases our network of potential recruits while also fostering collabora- tion among cannabis incubators and businesses in Fresno, a net benefit to the industry at large. As an example of this type of collaboration, Embarc is prepared to provide priority hiring to any graduate of Fresno Equity and Enterprise Development (F.E.E.D.), an applicant in the City’s licensing process that is seeking to create a social equity incubation campus. One hundred percent of all participants in that program would qualify as social equity, and thus our priority on hiring would ensure that every person that joins our team as part of that program qualifies. Additionally, we will leverage the following networks and tactics to recruit locally: Local Network —Steve has enjoyed a thirty-year career in Fresno spanning sports, real estate and service, and as such has developed a deep bench of relationships with community leaders, non-profit organizations and local residents that will inform his community engagement efforts. Upon being selected for a retail cannabis business license, Embarc will notify our extensive community and business network throughout Fresno of upcoming employment opportunities and will engage with these folks to ensure our workforce is local. Embarc will host our first Jobs Fair three months prior to opening our doors and will continue these efforts until we have achieved 100% local hiring. Community Advisory Board Members —Our Community Advisory Board brings diverse backgrounds and experiences to their work with Embarc, ranging from non-profits to school board members to leaders in the labor industry. We will work with these partners to identify and recruit local social equity applicants based on their extensive networks in our community. Local Media and Advisories —Three months prior to opening our doors, Embarc will post job opportunities in locally trusted and widely read media outlets, such as The Fresno Bee, Western Farm Press and Vida en el Valle. We will utilize our existing relationships with local journalists to garner excitement and gain interest in Embarc’s high paying jobs and comprehensive benefits program. One month prior to opening, Embarc leadership will participate in a fireside chat with local journalists to provide an overview of our employment opportunities and create public awareness around Embarc and our commitment to hiring a fully local Fresno team, as well as the importance of the City of Fresno’s efforts to create a social equity program that allows for both equity ownership and equity incubation. This is a tremendous step for the development of more equitable cannabis programs statewide and we will leverage the backgrounds of some of our team members focused on cannabis policy (Dustin Moore, Kevin Schmidt) to provide this context to local reporters in an effort to amplify this story to other jurisdictions in California and nationwide. Business Leader Partners —Three months prior to opening, Embarc will seek to partner with the Fresno Chamber of Commerce and Hispanic Chamber of Commerce to amplify our career opportunities in store management and as part of our Fresno-based corporate team at our local headquarters. This is also a tremen- dous opportunity to identify local businesses providing non-cannabis goods and services to ensure we are utilizing 100% local businesses for ongoing contracts ranging from landscaping and cleaning services to IT and maintenance. These efforts will be spearheaded in concert with our Community Engagement Advisor Scott Miller, who has served on the Board of the Fresno Chamber of Commerce and was named Small Business Advocate of the Year by the California Chamber of Commerce in 2014. Community Partners –Two months prior to opening our doors, Embarc will engage with “Know 1” to host a community discussion on equity in cannabis and upcoming employment opportunities in the Fresno cannabis industry. “Know 1” is a local group of prominent African American leaders from throughout the City of Fresno 110 with a notable track record of engagement on pressing issues to the community, including Black Lives Matter. We admire their leadership and understand that there remains much work to be done to ensure all people feel wel- come in the legal cannabis industry. We understand that for minority communities especially, cannabis can carry a heavy history and we commit to being an engaged leader in ensuring our local cannabis industry is diverse. Fresno County Workforce Development Partners —Two of our Community Advisory Board members sit on the Fresno Regional Workforce Development Board, a network of City and County elected officials and representatives from business, organized labor, education, economic development, community organizations and other entities focused on improving workforce opportunities in Fresno County. Through these relationships we will seek to tap into workforce development networks throughout the City that can amplify our efforts. Social Media Engagement —Social media is a powerful tool for local engagement. Upon being selected for a retail cannabis business license, Embarc will launch our local Instagram and Facebook business efforts. Three months prior to opening our doors, Embarc will launch a local hiring campaign through our curated local social media account to educate our community on job opportunities and career paths at Embarc and across the Fresno cannabis industry broadly. Fresno County Cultivators —As a community with a blossoming cannabis cultivation industry, we have no shortage of qualified cannabis professionals and enthusiasts. Embarc will work with our cultivation partners across the County -- including our principals’ own 24 acre cultivation project in the City of Mendota -- to ensure they are aware of the local job opportunities Embarc will offer in the retail cannabis space. Please see Section 2.9 for greater detail. University Partners —Embarc will work with Fresno City College leadership and appropriate student groups to educate and raise awareness on careers in cannabis. No less than two months prior to opening, we will work with these institutions to advertise job opportunities at Embarc. Online Recruitment Platforms —One month prior to opening our doors, Embarc will post upcoming job opportunities on trusted recruitment platforms such as Indeed.com and LinkedIn. We will limit the geographic target to the City of Fresno ensuring all applicants are local. Embarc Barrier Elimination Tactics Understanding that getting the job is only the first step in one’s journey of securing and maintaining gainful employment, Embarc has taken specific actions to ensure we are doing our part to eliminate barriers for success for all employees, including social equity applicants: • Embarc’s mentorship program creates one-on-one and small group settings by which colleagues discuss mobility opportunities • Embarc recently launched a “Happy Hour” program where members of each department participate in a bi-weekly Zoom meeting to break down barriers including perceived hierarchy and departmental structure to create cross-communication and collaboration • All new hires will undergo an unconscious bias training as part of their onboarding process • Embarc is launching an internal diversity and inclusion working group to develop an action plan to strengthen the company’s practices • Embarc has an established employee recognition program where employees publicly recognize one other, seeking to break stereotypes and stigmatization • Embarc is communicative about the importance of diversity and facilitates ongoing opportunities for employee feedback including all hands meetings and monthly anonymous surveys • Embarc provides an Employee Assistance Program which includes counseling sessions with an inde- pendent medical professional free of charge for all employees to explore these complex dynamics 111 Diversity must be more than a business practice; it must be central to the fabric of a company’s culture from the top down and bottom up. Embarc is proud of the diversity that exists within the company today, not only for store associates but throughout the company’s senior leadership. It is this diversity of backgrounds and experiences that enriches our company and ensures our team reflects the communities we serve. Four of the company’s six chief officers and 100% of current store-level management positions are held by women People of color across all levels and departments within the organization, including in ownership, executive level management and throughout our retail team LGBTQIA+ leaders in executive management and 50% of our store management Executive leadership includes an individual previously convicted of a nonviolent cannabis offense and a diversity and inclusion hiring ethos that continues to provide opportunities throughout the organization for those impacted by the War on Drugs Embarc is proud of its track record on diversity in recruiting and hiring to date, including the many programs, policies and commitments to ongoing innovation in this area. These efforts would be similarly implemented in Fresno, resulting in ownership opportunities for every employee in the company, a significant emphasis on creating leadership opportunities for those most impacted by the failed War on Drugs and institutionalized efforts to remove barriers to upward mobility for diverse employees. Furthermore, Embarc has provided a commitment to 50% social equity and 100% local hiring for its staff and provided a plan, including leveraging partnerships and various mediums, to recruit individuals who meet the criteria listed in the social equity policy section. SECTION 2.5 Describe the extent to which the Commercial Cannabis Business will be a locally managed enterprise whose owners and /or manag- ers reside within or own a commercial business within the City of Fresno, for at least one year prior to March 2, 2020. Embarc Fresno has partnered with Steve Hosey, a thirty-year resident of the City of Fresno who has chosen to build his business and raise his family in this community. Steve is a shareholder and will play a day-to-day management role in the business, overseeing the company’s local community engagement efforts and serving as Chair of the Community Advisory Board. Given Steve’s role, as well as our 100% local hire commitment, Embarc Fresno will be locally managed in close coordination with our executive team. One hundred percent (100%) of our employees, including management, will reside in Fresno and will be given meaningful equity in the business, further deepening local ownership. 112 SECTION 2.6 Describe the number of employees, title/position and their respected responsibilities. Embarc expects to initially hire the following number of employees prior operations. These numbers will increase to meet the demands of the business. NumberNumber RoleRole 11 General ManagerGeneral Manager 33 Store Managers —Operations, Inventory and CommunityStore Managers —Operations, Inventory and Community 22 Store LeadsStore Leads 11 Inventory SpecialistInventory Specialist 99 Sales and Delivery Associates (“Guides”)Sales and Delivery Associates (“Guides”) These roles are enhanced through the leadership of Embarc’s global team as well as Steve Hosey’s role as Head of Community Relations. Given spatial constraints, below are brief overviews of the title and responsibilities for each role. Each employee receives a detailed job responsibilities memo outlining the day-to-day tasks and functions associated with his or her role as well as a key metrics document to guide his or her performance and facilitate performance reviews as part of the onboarding process. General Manager The General Manager is responsible for overseeing all day-to-day operations, including managing store manag- ers and staff across sales, inventory, community engagement, facilities, accounting, marketing, public relations and more. This role is responsible for successfully developing and implementing strategies to constantly improve the business through merchandise, inventory, expense control, human resources management, and operational cost management. Importantly, this role is also ultimately responsible for ensuring strict adherence to all state and local laws and regulations pertaining to cannabis and business operations. Critical functions of the General Manager role include, but are not limited to: • Embodying our values and leading Managers and Guides in a positive and respectful manner. • Overseeing all compliance as outlined by state and local municipalities in coordination with Embarc’s compliance team. • Analyzing and measuring business trends; developing and implementing plans to maximize sales and meet or exceed goals and objectives. • Controlling shrink, expenses and payroll through active management of the business. • Ensuring compliance with all policies and procedures through regular store management and staff meetings, store walk-throughs, audits, etc. • Continually evaluating and reacting to performance issues and actively recruiting, inspiring and training management candidates. • Liaising with law enforcement, vendors, landlords, and community members as needed and through the lens of being proactive rather than reactive to opportunities, needs and requests. Store Manager Managers focus on customer satisfaction, daily operations and operational flow. In addition, each manager is responsible for one of three focus areas: Community Outreach, Inventory and Purchasing, and Operations and Compliance. Based on each focus area, managers are assigned specific roles and responsibilities necessary for effective execution of their role. Critical functions of the Store Manager role include, but are not limited to: 113 • Maintaining a compliant work environment through coordination with the General Manager on daily, weekly, quarterly and annual audits and spot checks. • Motivating a positive sales team through communication, incentives, and evaluations. • Confirming daily sales reports and cash receipts; ensuring monies are deposited regularly, and reports are submitted as prescribed by company policies. • Addressing customer needs and resolving issues, ensuring positive customer relationships. • Planning, organizing, and coordinating sales, marketing, and budgeting. • Developing and maximizing retail budget and product inventory, purchasing, and sales. • Ensuring inventory data is correct by performing spot inventory counts and checks. • Executing local employee volunteerism program with enthusiasm, inclusivity and sensitivity. • Maintaining communication with community members, stakeholders and customers to ensure Embarc is a welcoming environment that is responsive to local needs. • Liaising with law enforcement, vendors, landlords, and community members as needed and through the lens of being proactive rather than reactive to opportunities, needs and requests. Store Lead Store Leads support the Store Managers in ensuring that all daily operating procedures are performed as required while promoting a company image of excellence through a strong work ethic, leadership by example, and the consistent delivery of impeccable customer service and store visual presentation. This role will also maximize sales through the development and supervision of sales staff. The Store Lead is responsible for ensuring transactions are carried out in compliance with all applicable laws and regulations. Critical functions of the Store Lead role include, but are not limited to: •Implementing operational rules, regulations, policies, and procedures. • Supervising, managing, and directing the activities of the sales team (“Guides”). • Implementing company policies and ensure staff adheres to best practices. • Ensuring compliance with applicable local, state, and federal laws and regulations. • Maintaining in-depth knowledge of all inventory as well as product and trend knowledge. • Assisting in employee performance reviews. • Assisting in hiring and training new employees. Inventory Specialist Under the direction of, and coordination with, the Inventory Manager, the Inventory Control Specialist will maintain the organization’s inventory by managing and supplying necessary items while maintaining accurate records of all procurements. Critical functions of the Inventory Specialist include, but are not limited to: •Maintaining consistent stock of inventory. • Assessing inventory reports and order patterns to identify items in need of recurring delivery. • Providing inventory reports to inventory control manager. • Developing and maintaining good working relationships with vendors. • Maintaining accurate daily records of goods received. • Managing and maintaining the inventory system; facilitating upgrades to related database and/or software under the direction of the purchasing or inventory control manager. • Conducting frequent spot and partial audits of physical inventory. • Assisting with weekly physical inventory audits. • Leading education and training on all products for staff. Sales and Delivery Associates (“Guides”) Sales and Delivery Associates, or Guides, work closely with customers to determine their needs, answer their questions and recommend the right products. This role will promptly resolve customer issues and ensure maximum client satisfaction. Additionally, Guides must maintain up to date k nowledge of product features and maintain the store’s visual appearance. Critical functions of Guides include, but are not limited to: 114 • Friendly check-in with customers while scanning IDs into the POS system. • Ensuring high levels of customer satisfaction through excellent sales service. • Assessing customers’ needs, providing assistance and information on product features. • Maintaining in-stock and presentable condition assigned areas. • Actively seeking out customers in store. • Remaining knowledgeable on products offered and discussing available options. • Processing POS (point of sale) purchases. • Handling customer returns using the compliance protocol and SOP. • Maintaining a neat and orderly work environment, including participation in the store cleaning and disinfecting protocols. Sales and Delivery Associates (Guides) are cross-trained to engage in both retail and delivery activities because it is critical that all employees have a thorough understanding of all products and modalities in the store. Regardless of whether engaging with a customer in the store or on his or her doorstep, it is important our team be communicative and capable of answering specific questions about dosing rooted in extensive retail training. Additionally, Embarc intends to partner with local Fresno security company Signal 88 to hire both a Security Director and Security Guards. We are enthused at the prospect of utilizing their services to ensure the protec- tion of public health and safety on and about our premises. Security Guards 115 SECTION 2.7 Describe whether the CCB has five (5) or more employees and whether it has signed a labor peace agreement allowing employees to union- ize without interference. Embarc Fresno has not hired retail employees given it is not licensed to operate but would employ far more than five employees if selected to operate by the City. Embarc enjoys a strong partnership with UFCW in communities throughout Northern and Central California. Embarc has Labor Peace Agreements (LPA) across its operational and developing dispensaries with both UFCW Local 5 and UFCW Local 8 — Golden State and is currently actively negotiating a Collective Bargaining Agreement to unionize employees across all retail locations. This Collective Bargaining Agreement will be executed prior to the City of Fresno selecting cannabis operators to receive licenses. Consequently, employees of Embarc Fresno would be subject to this agreement, which far exceeds what is mandated by law for dispensary applicants. SECTION 2.8 Provide a workforce plan that includes at a minimum the follow- ing provisions: 2.8.1. Commitment for 30% of employees to be local hires; the business must show that it has either hired or made a good faith effort to hire bona fide residents of Fresno who have not established residency after the submission of an application for employment with the applicant/permittee. 100% Local Hiring Embarc is committed to the creation of a regional hub in Fresno as a central corporate headquarters for our license pursuits in the City of Fresno, our principals’ 24 acres of cultivation in the City of Mendota and our development of —and support for others’ —social equity incubation in the City. While it would be premature for Embarc to hire retail employees prior to submitting this application, and thus we have not yet engaged in hiring a retail team, we commit to continue our track record of local hiring: • 100% of Embarc’s retail workforce will be local to the City of Fresno • At least 50% will be representative of underserved communities (Section 2.4) • At least 20% will be graduates of our cannabis apprenticeship program and/or a cannabis incubator (Section 2.9) 116 Furthermore: • We have already begun hiring our corporate team, 100% of which is local • Steve Hosey, Embarc’s local partner, is local • 100% of Embarc’s project consultants are local • 100% of the Community Advisory Board members live and/or work locally To demonstrate our ability to deliver on this promise, 95% of our Tahoe team lives on the mountain and almost 80% of them reside within less than five miles of the store and 100% of our Alameda team is local. We are committed to 100% local hiring, well above the City’s desired 30% commitment, to ensure our employ- ees reflect the customer base and serve as a component of our overarching efforts to reflect, benefit and inte- grate into the Fresno community. While this is the right thing to do, it is also good business. Because employees will be local residents, they will naturally serve as ambassadors in the community and the community will feel more connected to operations. 2.8.2. Commitment to offer apprenticeships and/or compensation for continuing educa- tion in the field Embarc will implement a robust apprenticeship program rooted in ongoing education that will be the cor- nerstone of our commitment to workforce development in Fresno. This program is based on proven models from other apprenticeship programs in the cannabis industry and our extensive practical experience operating cannabis businesses. What’s the Goal? Embarc’s apprenticeship program is designed to provide the education and training necessary to set partici- pants up for success in the burgeoning legal cannabis industry. By utilizing a hybridized approach including classroom style education, soft skills and workforce development training and paid work experience, program graduates will have the skills they need to develop their careers at Embarc and beyond. It is our intention to work with our community partners, including local community colleges and the United Food and Commercial Workers Union to formalize this apprenticeship program. Who Can Join? • Applicants must be over the age of 21 • Applicants must be able to participate in classroom style education • Applicants must commit to working within Embarc’s retail environment to fulfill the apprenticeship program requirements • Applicants must be able to pass any regulatory requirements to be employed at a commercial cannabis premises such as a background check and LiveScan • No previous cannabis industry experience is required • Recruitment will be targeted to disadvantaged communities How It Works: Embarc is leveraging its extensive network of cannabis industry professionals and advisors to develop the classroom style curriculum that serves as the backbone of this program. These courses will include, but are not limited to, the following: • Can nabis Business Best Practices • State and Local Regulations • Can nabis Properties and Modalities • Standard Operating Procedures (SOPs) • Inventory Control • Track and Trace Tutorial • Safety and Security • Customer Service • Supply Chain Management 117 Additionally, participants will receive soft skills training and workforce development support through our part- nership with Fresno EOC. Fresno EOC has a proven track record of success with over 300 graduates within the last seven years from their Valley Apprenticeship Connections Program. Our goal is to build on their successes by expanding educational access and resources to Fresno residents seeking careers in the legal cannabis indus- try. Furthermore, we will encourage Embarc employees to participate in our apprenticeship trainings while compensating them for their time. As an employer, it is important that we invest in our employees’ education while strengthening not only their cannabis knowledge, but business acumen as well. Embarc’s retail footprint will allow us to provide real-world training through practice as a critical component of putting taught skills into action. Through paid work experience, apprenticeship participants can gain an invalu- able real-world understanding of how concepts function in reality. Upon conclusion, program participants are then given priority for Embarc hiring purposes and will also be uniquely qualified to work at any of Fresno’s licensed cannabis businesses given the skills gained during a cannabis-specific apprenticeship. Apprenticeships can serve as vital building blocks in creating an inclusive local cannabis industry that provides opportunity for all. From the curriculum we create to the hands-on training we facilitate to the real-word experience afforded by paid work experience, Embarc is committed to investing in the continuous education of employees, social equity participants and all those participating in apprenticeship programs. Doing so fosters diversity and inclusivity. 2.8.3. Commitment to pay a living wage to its employees. Embarc is committed to providing a living wage to its employees. For additional detail and to avoid redun- dancy, please see Section 2.1. SECTION 2.9 Describe whether the business is willing to serve as a Social Equity Business Incubator by offering support to local cannabis social equity businesses in the form of mentorship, training, equipment donation, a percentage of shelf space dedicated to Fresno equity business products, legal assistance, financial services assistance, or other technical assistance support. The scoring criteria considers apprenticeship and incubation as two separate programs. While we concur that they are distinct, we believe they are also intrinsically linked given apprenticeship is often a vital component of incubation. Embarc is committed to being a leader in our industry, and as such welcomes the opportunity to serve as a Social Equity Business Incubator by offering support to local cannabis businesses in the form of mentorship, training, a percentage of shelf space dedicated to Fresno equity business products, legal assistance, financial services assistance and other technical support. Creating sustainable pathways to educate and support the success of social equity applicants as owners of their own businesses is vital to ensuring the cannabis industry embarks on a more equitable path seeking to address the impacts of the failed War on Drugs on marginalized communities. Supporting social equity applicants’ matric- ulation into business ownership is about more than a few hours of executive-level volunteerism or legal services, although both are critical components of a comprehensive approach. Instead, we view this commitment as an extension of the apprenticeship program detailed above, with additional focus given to providing the technical support and partnership opportunities necessary for social equity businesses to become economic successes. 118 As such, our incubation will take a multi-pronged approach intended to provide the resources, skills, services and partnerships necessary for success. 1. Mentorship: While we cannot mentor every potential social equity applicant in Fresno, we will commit to the creation of a mentorship network between Embarc leadership and social equity applicants: a. Individual Mentorship: Each member of Embarc’s leadership team will be assigned two social equity incubatees (depending on how many individuals we serve at a time) to serve as a direct mentor. Executive members will meet quarterly with mentees. b. Flexible Leadership Access: Each member of Embarc’s leadership team will host monthly office hours in which any apprentice or incubatee can schedule a time directly with the person most suited to advise on a given issue. c. Experts on Hand: Embarc’s seasoned licensing and compliance team will donate 50 hours of time to advising apprentices and incubatees on how to navigate the cannabis licensure process. d. Developing a Network: Like most others, the cannabis industry requires hard work, dedication, and a robust network of connections. We will seek to leverage our extensive network across California’s supply chain to provide additional mentorship and support. 2. Training: Similar to the curriculum developed for Embarc’s apprenticeship program, Embarc’s executive team will develop and implement a cannabis business management training for social equity applicants seeking to open and operate their own cannabis businesses. This training will include ten hours of online and in person training from C-Suite executives focused specifically on tackling the opportunities and challenges of applicants’ proposed business models. Topics will include: regulatory compliance, cannabis application writing, legal and technical assistance, real estate and zoning compli- ance, marketing and advertising, and protecting public health and safety. 3. Shelf Space: One of the biggest obstacles facing cultivators, manufacturers, distributors and brands is getting on shelves, as without shelves there are no sales. Embarc commits to reserving a minimum of 20% of its shelf space to local social equity businesses and will seek to expand that number to up to 50% as brands operationalize in Fresno. 4. Legal Assistance: Navigating complex legal, entitlement and compliance challenges can be econom- ically crippling. Embarc commits to the following legal assistance: a. Embarc will fund record expungement for all participants in Embarc’s social equity incubation program b. Embarc will fund free legal services for mentees as part of its Flexible Leadership Access and Experts on Hand mentorship programs. 5. Financial Services Assistance: Embarc will provide financial literacy workshops for all incubatees as part of its comprehensive business management course. These workshops will be developed and led by our Chief Financial Officer and will focus on financial best practices, key considerations and navigating operational challenges (taxation). 6. Other Technical Support: Embarc will provide a variety of technical assistance and support based on the unique needs and priorities of each incubatee, including how to develop a pitch deck, how to present to investors, how to implement compliance procedures, how to manage human resources and more. Through our partnership with Fresno EOC, incubatees will also have access to a variety of resources that enhance their ability to develop and operate a business including soft skills trainings. 119 7. Economic Advantage: Embarc’s principals are currently developing a 24-acre cultivation site in Mendota will be one of the largest cultivation sites in the state. Embarc will provide this cultivated product to social equity incubatees (upon licensure) at cost to give them the opportunity to develop their products without the typical upfront costs and markups. Amplifying Local Social Equity We believe in the power of prosperity through partnership, or the ability to uplift an entire local ecosystem rather than centralize power in one company that seeks to dominate the supply chain. Partnering with farmers, celebrating sustainable farming practices, and finding opportunities to amplify local social equity brands is how we uplift one another and maintain the cannabis community. It also allows for shared prosperity rather than a monopoly. Embarc will: 1. Serve as a true partner to local cultivators and manufacturers: Because Embarc does not manufacture Embarc-owned products, we are the perfect partner to local entrepreneurs because our business relies on strong partnerships as the core of our model. This means we will not only buy locally cultivated and manufactured products —we will buy them consistently and in bulk given we are not focused on exclusively pushing our own products. 2. Dedicate prime shelf space for local producers and manufacturers: Product placement within the store matters, as customers are naturally drawn to certain displays and congregation areas. As detailed above, Embarc will allocate no less than 20% of its premier shelf space and display areas to local cultivators and manufacturers. Further, we will commit to at least one locally sourced SKU in each product category, so we are showcasing the diversity of local products across product types and categories. This ensures there is a local option for everyone who walks through our doors regardless of cannabis modality preferences. 3. Shop-in-shop for local producers and manufacturers: A shop-in-shop is a display area that has been retrofitted to provide dedicated, branded space for another company’s products. These executions bring a local producer’s brand to the forefront of the shopper’s experience, giving local products an outsized presence in the store and making the local products’ shop-in-shop a destination. This approach puts local cultivators and manufacturers at the forefront of the shoppers’ experience by letting them tell their own story rather than Embarc’s. 4. Collaborate on the development of marketing and branding materials to highlight local cultivators and manufacturers: A recent Nielsen survey indicated that buying locally produced products is a top priority for 46% of consumers. We are committed to fostering this trend and believe effective marketing and education campaigns are an important component of telling that story for locally produced prod- ucts. Leveraging our marketing and branding team’s significant expertise in the space, we will work collaboratively with local cultivation and manufacturing partners to develop branded materials these products as local. We can also develop branded educational materials highlighting local brands and products that we place in customer exit bags so they are aware of local products for their next visit or online order. 5. Develop special locals-only collaborations, holiday gift boxes and more: As part of our co-marketing efforts, we will develop special collaborations to effectively tell the local cultivators and manufacturers’ stories to ensure they capture outsized market share in Fresno. While we always have a discount for local residents, we can develop a local products discount that further incents customers to choose the local product over a larger brand. 120 6.Locals first policy for demonstration (“demo”) days: While getting on a retailer’s shelves is the biggest challenge for small cultivators and manufacturers, the second biggest challenge they face is breaking through all the noise and clutter to create brand awareness with consumers. Given the necessary advertising restrictions for the industry, the best way cultivators and manufacturers are able to interact with consumers is within a dispensary. We will consistently invite local producers and manufacturers to send brand ambassadors into the store to educate consumers about locally grown and manufactured brands on a regular basis and will adopt a “locals first” policy for demo days where local brands and products receive preferential treatment —whether that be reserving the days with the highest sales or the most number of days per month in the store. 7. Showcase locally cultivated and manufactured products on our website: We will regularly feature locally cultivated and manufactured products on our website and will create a “locally grown” section that is featured prominently to encourage consumers to support local brands. 8. Extend the reach of local producers throughout all of our stores: We will commit to carrying locally grown products from Fresno at all of our stores and will feature them in our “locally grown” section. This is meaningful for local producers seeking to expand their footprint beyond local shops. 9. Educate, educate, educate: Many customers are new to the cannabis market or are re-entering the market for the first time in decades. As a result, they do not yet have brand loyalty and instead look to their Guide (sales associate) to help them navigate what can be an overwhelming experience. That means that one of the most critical components of selling one product over another is ensuring that Guides have robust, ongoing education about locally cultivated and manufactured products. We will develop quarterly all-staff trainings specific to local cultivators and manufacturers where we will focus on connecting Guides to local cultivators and manufacturers. 10.Partner on Community Benefits and Impact Efforts: Customers care about their communities and appreciate when the places they shop do too. A 2014 Nielsen Global Survey found that fifty-five percent of online customers globally will pay more for a product or service if it is provided by a company that is committed to positive social and environmental impact. Community-mindedness and local community impact are the core of Embarc’s model, and we would welcome the opportunity to fold local cultivators and manufacturers into this process as well. This could include bigger efforts, such as inviting them to participate in our Community Advisory Board and contribute to the Community Investment Fund, or through product-specific fundraising efforts, such as a partnership where a percentage of sales from local products are donated to local community causes and non-profits. This is not exhaustive list of partnership opportunities with local social equity companies. Rather, it is intended to highlight the many ways —from marketing and branding to customer education and engagement —that collaboration can benefit all parties. Conclusion Embarc is committed to empowering Fresno’s social equity applicants through our apprenticeship and incu- bation initiatives. We are trusted partners and have the experience, track record and dedication necessary to participate in creating a more equitable cannabis industry. 121