HomeMy WebLinkAboutPlant Rd Farming LLC 2026-01-07LEASE
300 PLANT ROAD,
UKIAH, CALIFORNIA
Between
The City of Ukiah
as City
And
Plant Road Farming, LLC, a California limited liability company
as Tenant
COU No. 2526-120r
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LEASE
This Lease (this “Lease”), dated as of the date set forth in Section 1.1, is made by and between
The City of Ukiah, California (the “City”), and Plant Road Farming, LLC, a California
limited liability company (“Tenant”). The following exhibits are incorporated herein and made
a part hereof: Exhibit A (Outline of Premises), Exhibit B (Addendum).
1 BASIC LEASE INFORMATION; DEFINITIONS
1.1 Effective Date:
1.2 Premises:
1.2.1 “Premises”: Certain real property located as 300 Plant Road, Ukiah,
CA consisting of approximately 17 acres of land,
together with the Building and all improvements located
thereon, and more particularly described on Exhibit A
attached hereto.
1.2.2 “Building”: The free-standing warehouse structure on the Premises.
1.3 Term
1.3.1 “Term”: The Initial Term and any Renewal Lease Term (as
defined in Section 16).
1.3.2 “Initial Term”: The initial term of this Lease (the “Initial Term”) shall
begin on the Commencement Date and expire on the
Expiration Date (or any earlier date on which this Lease
is terminated as provided herein).
1.3.3 “Commencement
Date”:
The Term shall commence on the Effective Date.
1.3.4 “Expiration
Date”:
The last day of the sixtieth (60th) full calendar month
following the Rent Commencement Date.
1.4 Rent
1.4.1 “Base Rent”: Base Rent shall be $8,333.33 per month.
1.4.2 “Rent
Commencement Date”:
Payment of Rent shall commence, at Tenant’s sole
election, either:
(a)The first day of the calendar month
immediately following Tenant’s receipt of all Required
Authorizations (as defined herein); or
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(b) January 1st of the calendar year
immediately following Tenant’s receipt of all Required
Authorizations (as defined herein).
Tenant shall not commence operations of the Permitted
Use at the Premises prior to the Rent Commencement
Date. Notwithstanding the foregoing, at any time prior to
the Rent Commencement Date, Tenant shall be permitted
to install the Approved Improvements (as defined herein)
and perform all other work necessary to prepare the
Premises for the Permitted Use.
1.4.3 “Rent
Escalations”
Beginning on the first anniversary of the Rent
Commencement Date, and on each anniversary
thereafter during the Term, the Base Rent shall increase
based on the percentage change of the Consumer Price
Index for the San Francisco Bay Area, as published by
the US Bureau of Labor Statistics.
1.4.4 “Additional
Rent”:
All amounts payable by Tenant under this Lease, other
than Base Rent, and whether or not expressly designated
as Additional Rent in this Lease.
1.5 “Permitted Use”: Cannabis outdoor cultivation, including without
limitation, nursery, cultivation and processing
operations, and any related activities that do not violate
the Required Authorizations (as such term is defined in
Section 4 of the Addendum, attached hereto as Exhibit
B).
1.6 Address of Tenant: The Premises.
Attention: Joshua Keats
Email: joshua@henrysoriginal.com
1.7 Address of City: City of Ukiah
300 Seminary Avenue
Ukiah, CA 95482
Attn: Sage Sangiacomo, City Manager
Email: ssangiacomo@cityofukiah.com
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2 PREMISES.
2.1 Lease of Premises for Lease Term. Subject to the terms hereof, City hereby leases
the Premises to Tenant and Tenant hereby leases the Premises from City for the Initial Term, as it
may be terminated early or extended pursuant to the terms hereof.
2.2 Water Requirement. City hereby acknowledges that Tenant’s ability to operate
the Permitted Use at the Premises requires water at a minimum annual rate equal to 4 acre feet per
acre of cannabis canopy planted at the Premises (the “Minimum Water Requirement”). The City
acknowledges and agrees that Tenant’s actual water usage may fluctuate, at Tenant’s discretion,
during each calendar year of the Term.
2.3 Condition of Premises; Inspection. From a date commencing on the
Commencement Date and continuing until the Rent Commencement Date (the “Inspection
Period”), Tenant shall have the right entirely at Tenant’s expense to enter and inspect the Premises
to confirm: (a) the Premises’ ability to supply the Minimum Water Requirement; (b) the suitability
of the Premises for Tenant’s intended use; and (c) compliance of the Premises with Applicable
Law, including without limitation, all applicable Environmental Laws as defined in Appendix B,
Section 7. During the Inspection Period, the City shall cooperate with Tenant’s inspection
hereunder and ensure Tenant has access to enter and inspect the Premises. During the Inspection
Period, in the event the Tenant determines that the Premises fails to meet any of Tenant’s
requirements, Tenant shall have the right to terminate the Term pursuant to Section 5.2(i) below.
If Tenant does not terminate this Lease on or before the conclusion of the Inspection Period, it
shall be deemed to have accepted the Premises in its AS-IS condition without any express or
implied representation or warranty by the City as to its condition of suitability for Tenant’s
intended use, except as otherwise provided in this Lease.
3 RENT.
3.1 Rent Payable to City. Commencing on the Rent Commencement Date, Tenant
shall pay all Base Rent and Additional Rent (collectively, “Rent”) as set forth herein, in legal
tender of the United States without prior notice or demand or any setoff or deduction,. Monthly
payments of Base Rent shall be delivered by Tenant to and received by City, in advance,
commencing on the Rent Commencement Date and for each month thereafter on the first day of
each calendar month during the Term. To the extent applicable, monthly payments of Gross Lease
Expenses (as defined in Section 3.2) shall be paid by Tenant directly to the applicable payee prior
to the date such payments come due during the Term. City agrees to provide copies of any charges
for Gross Lease Expenses to Tenant on a timely basis to allow Tenant to pay such amounts when
due.
3.2 Payment Obligations of Tenant and City.. In addition to Base Rent Tenant shall
pay when due all charges payable by Tenant in connection with Tenant’s business operations on
the Premises, including, without limitation, possessory interest taxes on Tenant’s leasehold
interest in the property, other taxes payable by Tenant in connection with its use of the Premises,
such as, but not limited to, income taxes, business inventory taxes, business license fees, fees and
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payments imposed on cannabis businesses and costs associated with the operation, maintenance,
repair, replacement or alteration of improvements located on the Premises or the Building,
including, without limitation, any insurance policies required to be maintained or otherwise
incurred by Tenant, any personal property insurance Tenant elects to obtain, security, maintenance,
and management (“Gross Lease Expenses”). Except as otherwise expressly provided in this Lease,
Tenant shall not be liable to pay or reimburse City for expenses imposed on the City in connection
with its ownership of the Premises, including, but not limited to taxes, insurance policies
maintained by the City and administrative costs, the maintenance, repair, replacement, or alteration
of any items for which the City is responsible under Section 6.1. Commencing on the Rent
Commencement Date, Tenant shall begin timely payment to City for: (i) Base Rent (which
includes water service and usage); and (ii) the cost of any City furnished utilities and actually used
by Tenant (e.g., sewer, solid waste collection and electricity).
4 USE; COMPLIANCE WITH LAWS; HAZARDOUS MATERIALS .
4.1 Permitted Use. Tenant shall not use the Premises for any purpose other than the
Permitted Use. Tenant shall use the Building for storage of equipment and machinery but not for
storage of cannabis or cannabis products as long as the Building remains in the unincorporated
area of the Premises. Tenant may locate temporary, permitted storage structures on the Premises
for storage of cannabis or cannabis products if needed during until the Building is incorporated.
4.2 Quiet Enjoyment. City covenants that, so long as Tenant is not in default of this
Lease or in violation of any Applicable Law, Tenant shall have the right to quietly enjoy and
possess the Premises without interference from the City. During the Term, Tenant shall have
access to the Premises 24 hours per day, 7 days a week.
4.3 Compliance with Laws. Subject to the terms of the Addendum, set forth in
Exhibit B, Tenant, at its expense, shall comply with all Applicable Laws (as defined in Exhibit B)
relating to (i) the operation of its business at the Premises, (ii) the use, condition, configuration or
occupancy of the Premises.
5 EARLY TERMINATION OPTION.
5.1 By City.
5.1.1 The City may terminate this Lease by providing thirty (30) days’ prior
written notice to Tenant, in the event that: (A) any City law, ordinance, regulation, or governmental
approval that is required for the City to validly permit Tenant’s use of the Premises for the
Permitted Use is invalidated or overturned; (B) the City is ordered by a court of competent
jurisdiction to prohibit Tenant’s use of the Premises for the Permitted Use; or (C) the City resolves
litigation relating to its outdoor cannabis program by agreeing to prohibit the Permitted Use at the
Premises.
5.1.2 At any time following the 10-year anniversary of the Rent Commencement
Date, the City may, in its sole discretion, terminate this Lease by providing Tenant with no less
than 12 months prior written notice, if the City desires to use the Premises and/or the Building for
municipal purposes. The City may elect to: (i) terminate this Lease in its entirety; or (ii) terminate
only Tenant’s lease of the Building. In the event the City terminates only the lease of the Building
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hereunder and the Tenant does not otherwise terminate the Lease pursuant to Section 5.2(vii)
below, then the Parties shall without change in the amount of rent amend this Lease to remove the
Building from the Premises and the Lease shall continue in full force and effect with respect to the
remainder of the Premises.
5.2 By Tenant. At any time upon 30 days written notice to the City, Tenant may
terminate this Lease: (i) during the Inspection Period, for any reason; (ii) in the event the City
revokes, suspends, or terminates any of the Required Authorizations; (iii) in the event the
Department of Cannabis Control (the “DCC”) revokes, suspends, or terminates any of the
Required Authorizations; (iv) in the event the City or the DCC adopts or modifies any law,
ordinance, regulation, or tax measure or adopts any other regulatory, economic, environmental,
or other condition that adversely affects the economic viability or feasibility of Tenant’s
operations at the Premises, or prohibits Tenant’s ability to operate the Permitted Use at the
Premises.
5.3 Effect of Termination. Any termination notice delivered by a Party hereunder
shall specify the date Tenant will vacate the Premises (the “Early Termination Date”) which
shall be no less than three (3) months after the date of delivery of the termination notice, provided
that, if Tenant determines, in its reasonable discretion, it is unable to vacate the Premises by the
Early Termination Date due to weather conditions, the Early Termination Date shall be extended
for a reasonable period necessary to allow Tenant to vacate the Premises. After the Early
Termination Date, City and Tenant shall be released from all further liability to the other party,
with the exception of any obligation that accrued prior to the Early Termination Date or that
otherwise survives the expiration or termination of this Agreement.
6 REPAIRS AND ALTERATIONS.
6.1 Repairs. Throughout the Term, Tenant shall keep the Building and the Property in
good condition and repair. The City Water and Sewer utilities shall maintain and repair the City’s
water system and water delivery system used to provide water to the Premises, including without
limitation, piping and other infrastructure used to deliver water at the Premises to which Tenant
can connect for use in its farming and other business operations on the premises (“City Facilities”).
To the extent the Building is equipped with any electrical, mechanical, plumbing, heating, or air-
conditioning systems, the City shall keep such systems in good condition and repair. Throughout
the Term, Tenant, at Tenant's expense, shall repair, replace, and maintain in good condition all
portions of the Premises, including entries, doors, ceilings, glass partitions, and interior walls. Any
repairs or maintenance shall be completed with materials of similar quality to the original
materials. In the event of any damage, failure, or interruption affecting City Facilities, City shall
use commercially reasonable efforts to repair them within 24 hours of written notice from Tenant.
If City fails to restore such water access within 24 hours, Tenant shall be entitled to an abatement
of Rent for each day that water access remains impaired calculated by dividing monthly rent by 30
and multiplying the result by the number of such days.
6.2 Alterations. Tenant shall not make any change, alteration, addition, or
improvement to the Premises (collectively “Alterations”) without City's prior written consent
which consent shall not be unreasonably withheld, conditioned, or delayed, provided, however,
that Tenant shall be permitted, and the City hereby approves: (a) Tenant’s installation of wildlife
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exclusionary fences along the perimeter of the Premises; and (b) Tenant’s construction and use of
unengineered cold frame hoop houses (the “Approved Improvements”).As provided in Sections
3.2 and 6.1 Tenant is responsible for repair and maintenance of such fences and hoop houses.
7 RESERVED.
8 LIENS. Tenant shall keep the Premises free from any lien arising out of any work
performed, material furnished or obligation incurred by or on behalf of Tenant. Tenant shall
remove any such lien within ten (10) business days after notice from City, and if Tenant fails to
do so, City, without limiting its remedies, may pay the amount necessary to cause such removal,
whether or not such lien is valid. The amount so paid, together with reasonable attorneys’ fees
and expenses, shall be reimbursed by Tenant as Rent.
9 INDEMNIFICATION; INSURANCE.
9.1 Indemnification.
Tenant shall indemnify, defend and hold harmless City and City’s officers, directors, employees,
and agents (the “City Parties”) from and against any and all claims, suits, demands, costs,
attorneys' fees, expenses, and liabilities (“Losses”) arising from: (a) Tenant's use of the Premises;
(b) the conduct of Tenant's business; (c) any activity, work, or things done, permitted, or suffered
by Tenant in, on, or about the Premises; (d) any breach or default in the performance of any
obligation on Tenant's part to be performed under the terms of this Lease; or (e) any negligence
of Tenant, or any of Tenant's agents, contractors, invitees, or employees. In case any action or
proceeding shall be brought against City by reason of any such claim, Tenant, upon notice from
City, shall defend the same at Tenant's expense by counsel satisfactory to City. Notwithstanding
the foregoing, Tenant shall have no obligation to indemnify or hold harmless City or any City
Party from or against any Losses arising from: (w) the sole and active negligence or intentional
misconduct of City and/or any City Party.Except for the negligence or intentional misconduct of
Tenant and/or any Tenant Parties, City shall indemnify and hold harmless Tenant and Tenant's
officers, agents, and employees, , (collectively, "Tenant Parties") from and against any and all
Losses arising from: (a) City's use of the Premises, the Building, or the Property; (b) the conduct
of City's business or from any activity, work, or things done, permitted, or suffered by City in, on,
or within any area about the Premises over which the City exercises control the Premises, the
Building, or the Property; (c) any breach or default in the performance of any obligation on City's
part to be performed under the terms of this Lease; or (d) any negligence of City, any City Parties,
or any of City's contractors. In case any action or proceeding shall be brought against Tenant by
reason of any such claim, City, upon notice from Tenant, shall defend the same at City's expense
by counsel satisfactory to Tenant.
9.2 Tenant’s Insurance. . Tenant shall maintain insurance consistent with the City’s
minimum requirements, a current copy of which is attached hereto as Exhibit C (the “Minimum
Insurance Requirements”). The Parties acknowledge that such Minimum Insurance
Requirements may change from time to time, in which case the City shall provide written notice
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to Tenant of such changes. To the extent Tenant is required to obtain additional insurance to
comply with such changes, Tenant shall timely obtain such additional coverage.
9.3 Form of Policies. Policy forms must be approved by City. The minimum limits of
insurance required to be carried by Tenant shall not limit Tenant’s liability. Tenant’s commercial
general liability insurance shall (a) name the City as additional insured, and (b) be primary
insurance as to all claims thereunder and provide that any insurance carried by City is excess and
non-contributing with Tenant’s insurance.
9.4 Subrogation. Notwithstanding any provision in this Lease to the contrary (but
subject to the provisions set forth in Section 11 below) each party waives, and shall cause its
insurance carrier to waive, any right of recovery against the other party, any of its (direct or
indirect) owners, or any of their respective beneficiaries, trustees, officers, directors, employees or
agents for any loss of or damage to property which loss or damage is (or, if the insurance required
hereunder had been carried, would have been) covered by the waiving party’s property insurance.
For purposes of this Section 9.4 only, (a) any deductible with respect to a party’s insurance shall
be deemed covered by, and recoverable by such party under, valid and collectable policies of
insurance, and (b) any contractor retained by City to install, maintain or monitor a fire or security
alarm for the Building shall be deemed an agent of City.
10 CASUALTY DAMAGE. If the Premises shall be partially or totally damaged or destroyed
by fire or other casualty, the Rent payable hereunder shall be abated to the extent that the Premises
shall have been rendered untenantable and for the period from the date of such damage or
destruction to the date it is rendered tenantable. With reasonable promptness after discovering any
damage to the Premises (other than trade fixtures) necessary for access to or tentability of the
Premises, resulting from any fire or other casualty (a “Casualty”), City shall notify Tenant of
City’s reasonable estimate of the time required to substantially complete repair of such damage
(the “City Repairs”). If, according to such estimate, the City Repairs cannot be substantially
completed within two hundred seventy (270) days after they are commenced, Tenant may
terminate this Lease upon sixty (60) days’ notice to the other party delivered within ten (10) days
after City’s delivery of such estimate. If this Lease is not terminated pursuant to this Section 10,
City shall promptly and diligently perform the City Repairs, subject to reasonable delays for
insurance adjustment and other events of Force Majeure. The City Repairs shall restore the
Premises (other than trade fixtures) and any portion of the Base Building necessary for access to
or leaseability of the Premises to substantially the same condition that existed when the Casualty
occurred, except for any modifications required by Applicable Law or any Security Holder.
11 NONWAIVER. No provision hereof shall be deemed waived by either party unless it is
waived by such party expressly and in writing, and no waiver of any breach of any provision hereof
shall be deemed a waiver of any subsequent breach of such provision or any other provision hereof.
12 CONDEMNATION. If any part of the Premises, Building, or Property is taken for any
public or quasi-public use by power of eminent domain or by private purchase in lieu thereof (a
“Taking”) such that Tenant is materially prevented from conducting the Permitted Use at the
Property for a period of at least one hundred eighty (180) days, Tenant may terminate this Lease.
Any such termination shall be effective as of the date possession must be surrendered to the
authority, and the terminating party shall provide termination notice to the other party within forty-
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five (45) days after receiving written notice of such surrender date. Except as provided above in
this Section 12, neither party may terminate this Lease as a result of a Taking. If this Lease is
terminated pursuant to this Section 12, all Rent shall be apportioned as of the date of such
termination.
13 ASSIGNMENT AND SUBLETTING.
13.1 Tenant shall not assign or sublease any part of the Premises to any persons, without
City’s written consent, at the City’s sole and absolute discretion.
14 SURRENDER. Upon the expiration or earlier termination hereof, and subject to
Section 10 and this Section 14, Tenant shall surrender possession of the Premises to City.
15 RENEWAL OPTION.
15.1 Tenant’s Renewal Option. Tenant shall have the right to renew the Term of this
Lease ("Renewal Option") for up to three (3) additional terms of five (5) years (each, a "Renewal
Lease Term") commencing on the day following the expiration of the Initial Lease Term, provided
that each of the following occurs: (a) City receives initial notice of the exercise of the Renewal
Option ("Renewal Notice") any time during the Initial Lease Term, or Renewal Lease Term, as
applicable;; and (c) the Lease has not been assigned by Tenant prior to the date Tenant delivers its
Renewal.
15.2 Rent Payable During the Renewal Lease Term . The Base Rent rate payable
during the Renewal Lease Term shall equal one hundred percent (100%) of the annual Base Rent
payable immediately prior to the commencement of the Renewal Lease Term, subject to annual
escalation in accordance with section 1.4.3.
16 SUBORDINATION. This Lease shall be subject and subordinate to all existing and future
ground or underlying leases, mortgages, trust deeds and other encumbrances against the Building
or Property, all renewals, extensions, modifications, consolidations and replacements thereof
(each, a “Security Agreement”), and all advances made upon the security of such mortgages or
trust deeds, unless in each case the holder of such Security Agreement (each, a “Security Holder”)
requires in writing that this Lease be superior thereto. Upon any termination or foreclosure (or
any delivery of a deed in lieu of foreclosure) of any Security Agreement, Tenant, upon request,
shall attorn, without deduction or set-off, to the Security Holder or purchaser or any successor
thereto and shall recognize such party as the lessor hereunder provided that such party agrees not
to disturb Tenant’s occupancy so long as Tenant timely pays the Rent and otherwise performs its
obligations hereunder.
17 ENTRY BY LANDLORD. In an emergency, City may enter the Premises to (i) inspect
the Premises; or (ii) perform maintenance, repairs, improvements, or alterations.
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18 DEFAULTS; REMEDIES.
18.1 Events of Default. The occurrence of any of the following shall constitute a
“Default”:
18.1.1 Any failure by Tenant to pay any Rent when due and such nonpayment
continues after forty five (45) days written notice from City that the same is past due, provided
that past due rent incurs interest at one percent (1%) per month or any fraction thereof (e.g., rent
due September 1 incurs 1% interest if paid on September 15). Rent remains delinquent until past
due rent plus incurred interest is paid in full.
18.1.2 Any failure by Tenant to comply with or perform any other terms,
covenants, conditions under this Lease, and such failure continues after thirty (30) days written
notice from City specifying the items in default, provided however, that if in the City’s reasonable
judgment such failure cannot be cured within said 30-day period, such longer period (but in no
event longer than 60 days) as may reasonably be necessary to cure such failure provided Tenant is
diligently proceeding in good faith to cure the default; or
18.1.3 Abandonment or vacation of all or a substantial portion of the Premises by
Tenant.
18.2 Remedies Upon Default. Upon any Default, City may, at its option, exercise any
or all of the remedies listed below. No such remedy herein or otherwise conferred upon or reserved
to City shall be considered exclusive of any other remedy, but the same shall be cumulative and
shall be in addition to every other remedy given hereunder or now or hereafter existing at law or
in equity, and every power and remedy given by the Lease to City may be exercised from time to
time and as often as the occasion may rise or may be deemed expedient.
18.2.1 City may: (i) terminate this Lease without further notice, and Tenant shall
then surrender the Premises to City; or (ii) enter and take possession of the Premises, in accordance
with any applicable laws governing such repossession, and remove Tenant, with or without having
terminated this Lease. The provisions of this Section 18.2.1 shall operate as a notice to quit, any
other notice to quit or of City's intention to re-enter the Premises being expressly waived. If
necessary, City may proceed to recover possession of the Premises under applicable laws, or by
such other legal proceedings, including re-entry and possession. City's exercise of any of its
remedies or its receipt of Tenant's keys shall not be considered an acceptance or surrender of the
Premises by Tenant. A surrender must be agreed to in writing and signed by both parties.
19 MISCELLANEOUS.
19.1 Notices. No notice, demand, statement, designation, request, consent, approval,
election or other communication given hereunder (“Notice”) shall be binding upon either party
unless (a) it is in writing; (b) it is (i) sent by certified or registered mail, postage prepaid, return
receipt requested, (ii) delivered by a nationally recognized courier service, (iii) delivered
personally; or (iv) included in or as an attachment to an email the receipt of which has been
acknowledged and (c) it is sent or delivered to the address set forth in Section 1.7 or 1.8, as
applicable, or to such other place (other than a P.O. box) as the recipient may from time to time
designate in a Notice to the other party. Any Notice shall be deemed received on the earlier of the
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date of actual delivery or the date on which delivery is refused, or, if Tenant is the recipient and
has vacated its notice address without providing a new notice address, three (3) days after the date
the Notice is deposited in the U.S. mail or with a courier service as described above. No provision
of this Lease requiring a particular Notice to be in writing shall limit the generality of clause (a)
of the first sentence of this Section 19.1.
19.2 Force Majeure. If either party is prevented from performing any obligation
hereunder by any strike, act of God, fire, war, terrorist act, shortage of labor or materials,
epidemics, pandemics, or other national or regional emergencies, governmental action (including,
without limitation, governmentally required evacuations or shutdowns), civil commotion or other
cause beyond such party’s reasonable control (“Force Majeure”), such obligation shall be excused
during (and any time period for the performance of such obligation shall be extended by) the period
of such prevention.
19.3 Attorneys’ Fees. In any action or proceeding between the parties, including any
appellate or alternative dispute resolution proceeding, the prevailing party may recover from the
other party all of its costs and expenses in connection therewith, including reasonable attorneys’
fees and costs actually incurred.
19.4 Brokers. There are no brokers involved in this Lease.
19.5 Successors. The provisions of this Lease shall be binding upon and inure to the
benefit of City and Tenant, respectively, and their respective approved successors, assigns, heirs,
executors, and administrators. Tenant agrees to become the tenant of City's successor in interest
under the same terms and conditions of its tenancy hereunder.
19.6 Governing Law; WAIVER OF TRIAL BY JURY. This Lease shall be construed
and enforced in accordance with the laws of the State of California. THE PARTIES WAIVE, TO
THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY
LITIGATION ARISING OUT OF OR RELATING TO THIS LEASE, THE RELATIONSHIP
OF LANDLORD AND TENANT, TENANT’S USE OR OCCUPANCY OF THE PREMISES,
AND/OR ANY CLAIM FOR INJURY OR DAMAGE OR ANY EMERGENCY OR
STATUTORY REMEDY.
19.7 Interpretation. As used herein, the capitalized term “Section” refers to a section
hereof unless otherwise specifically provided herein. As used in this Lease, the terms “herein,”
“hereof,” “hereto” and “hereunder” refer to this Lease and the term “include” and its derivatives
are not limiting. Any reference herein to “any part” or “any portion” of the Premises, the Land or
any other property shall be construed to refer to all or any part of such property. As used herein
in connection with insurance, the term “deductible” includes self-insured retention. Wherever this
Lease prohibits either party from engaging in any particular conduct, this Lease shall be deemed
also to require such party to cause each of its employees and agents (and, in the case of Tenant,
each of its licensees, invitees and subtenants, and any other party claiming by, through or under
Tenant) to refrain from engaging in such conduct. Wherever this Lease requires City to provide a
customary service or to act in a reasonable manner (whether in incurring an expense, establishing
a rule or regulation, providing an approval or consent, or performing any other act), this Lease
shall be deemed also to provide that whether such service is customary or such conduct is
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reasonable shall be determined by reference to the practices of owners of buildings that (i) are
comparable to the Facility in size, age, class, quality and location, and (ii) at City’s option, have
been, or are being prepared to be, certified under the U.S. Green Building Council’s Leadership in
Energy and Environmental Design (LEED) rating system or a similar rating system. Tenant
waives the benefit of any rule that a written agreement shall be construed against the drafting party.
19.8 Entire Agreement. This Lease sets forth the entire agreement between the parties
relating to the subject matter hereof and supersedes any previous agreements (none of which shall
be used to interpret this Lease). Tenant acknowledges that in entering into this Lease it has not
relied upon any representation, warranty or statement, whether oral or written, not expressly set
forth herein. This Lease can be modified only by a written agreement signed by both parties.
[SIGNATURES ARE ON THE FOLLOWING PAGE]
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12
IN WITNESS WHEREOF, City and Tenant have caused this Lease to be executed the day
and date first above written.
CITY:
City of Ukiah, California
By: _________________________
Name: _______________________
Title: _______________________
TENANT:
Plant Road Farming, LLC
By:
Name:
Title:
Sage Sangiacomo
City Manager
Joshua Keats
Manager
Doc ID: 70d55cb740cd0b1eb8cb6fbb2bc5176224afb0c6
Exhibit A
1
EXHIBIT A
LEGAL DESCRIPTION OF PREMISES
Doc ID: 70d55cb740cd0b1eb8cb6fbb2bc5176224afb0c6
Bureau of Land Management, Esri, HERE, Garmin, GeoTechnologies, Inc., USGS, EPA
Legend
Rivers
Ukiah Parcels
Lease Area A
Lease Area B
Access Roads
AERIAL IMAGERY AND LEASE AREA MAP
THIS MAP AND DATA ARE PROVIDED WITHOUT WARRANTY OF ANY KIND.
THIS MAP SERVES AS A VISUAL INTERPRETATION AND APPROXIMATION OF LEGAL AND ASSESSED DESCRIPTIONS THAT
MAY NOT BE 100% ACCURATE. BOUNDARIES MAY NOT BE AS DEPICTED.
0 640
Feet :
AREA A : CULTIVATION
AREA B : BARN/STORAGE AREA
TOTAL AREA: 17 ACRES
AREA : 0.31 ACRES
EXHIBIT A
Doc ID: 70d55cb740cd0b1eb8cb6fbb2bc5176224afb0c6
Schedule 1
1
EXHIBIT B
ADDENDUM TO LEASE
THIS ADDENDUM TO LEASE (“Addendum”) is made a part of, that certain Lease to
which it is attached (the “Primary Lease”), entered into by and between the City of Ukiah,
California (the “City”), and Plant Road Farming, LLC, a California limited liability company
(“Tenant”) (each a “Party” and collectively the “Parties”), and dated as of _____________, 2025
(the “Effective Date”). The Primary Lease, as modified, supplemented and superseded by this
Addendum is hereinafter referred to as the “Lease”. If there is any conflict between the Primary
Lease and this Addendum, this Addendum shall control. Unless otherwise defined in this
Addendum, capitalized terms shall have the meanings assigned to them in the Primary Lease.
1. APPLICABLE LAW. Paragraph 4.2 of the Lease is supplemented as follows:
Notwithstanding the foregoing, the term “Applicable Law” means any valid, enforceable law or
regulation, including, without limitation, building codes, applicable laws, covenants, regulations,
or ordinances, in any case whether existing now or at any time hereafter during the term of the
Lease, that is applicable to the Premises or to Tenant’s use or occupancy of the Premises for the
Permitted Use, but expressly excludes any federal law, including but not limited to 21 U.S.C. §
811, et seq. and all regulations promulgated thereunder (the “Controlled Substances Act” or
“CSA”), that is inconsistent with or conflicts with Tenant’s use of the Premises for the Permitted
Use in accordance with state and local law.
2. FEDERAL LAW ACKNOWLEDGEMENT. Notwithstanding anything in the
Lease to the contrary, City and Tenant expressly acknowledge that, as of the date of this Lease,
the Permitted Use may constitute a violation of the CSA and is not sanctioned by any federal
regulation. Tenant shall not be in breach of any provision of the Lease on that basis.
3. CHANGE IN APPLICABLE LAW. If any change to Applicable Law has a
materially adverse effect on the ability of Tenant to carry out its operations at the Premises or
City’s risks in leasing the leased premises to Tenant, Tenant and City shall have the right, but not
the obligation, to terminate the Lease, by delivering written notice of termination to the other party.
Such termination shall be effective on the date that Tenant vacates the Premises, which shall be
within the deadline set by applicable law enforcement, or, if none, then within ten (10) days of
such notice.
4. REQUIRED AUTHORIZATIONS; COOPERATION. It is acknowledged that the
Permitted Use is a highly regulated activity, and Tenant will be required to obtain various state
and local authorizations to operate the Permitted Use at the Premises (collectively, the “Required
Authorizations”), including without limitation: (a) state commercial cannabis license(s) from the
California Department of Cannabis Control (the “State Licenses”); (b) local commercial cannabis
license(s) from the City (the “Local Licenses”); and (c) conditional use permits (CUP), land use
permits (LUP), CEQA exemptions and other environmental and water approvals. The City hereby
agrees to use best efforts to timely process Tenant’s application for the Local Licenses and any
Doc ID: 70d55cb740cd0b1eb8cb6fbb2bc5176224afb0c6
Exhibit B
2
other land use approvals required by the City Code and upon granting such approvals or issuing
such licenses to promptly and accurately complete and sign any documents required by the
California Department of Cannabis Control or other relevant regulatory body certifying that such
approvals have been obtained.
5. WASTE. City expressly acknowledges that Tenant’s Permitted Use may create
waste. Tenant agrees that any such waste shall be subject to appropriate disposal or destruction
in accordance with MAUCRSA and in accordance with Applicable Law.
As used herein, “Environmental Laws” means any and all federal, state, or local laws, ordinances,
rules, decrees, orders, regulations, or court decisions relating to hazardous substances, hazardous
materials, hazardous waste, toxic substances, environmental conditions on, under, or about the
Premises, the Building, or the Property, or soil and ground water conditions, including, but not
limited to, the Comprehensive Environmental Response, Compensation and Liability Act of 1980
(CERCLA), the Resource Conservation and Recovery Act (RCRA), the Hazardous Materials
Transportation Act, any other law or legal requirement concerning hazardous or toxic substances
6. LAW ENFORCEMENT NOTICE. In the event that Tenant receives notice from
any federal, state or local law enforcement organization or any local or State level organization
holding jurisdiction over permitting, licensing and enforcement of cannabis operations, declaring
Tenant’s Permitted Use of the Premises unlawful, including, without limitation: (a) any law
enforcement action comprising a civil or in rem forfeiture demand, action or threat; (b) official
changes in federal enforcement policy; (c) the investigation into and/or filing of local, state, or
federal criminal charges relating to the Permitted Use; (d) the denial of a renewal of any local
permit or license which relates to, is required for, or is incidental to Tenant’s use of the Premises
for the Permitted Use; and/or (e) the denial of any State license or permit which relates to, is
required for, or is incidental to Tenant’s use of the Premises for the Permitted Use (each a “Law
Enforcement Intervention”), and Tenant determines, in good faith, that such Law Enforcement
Intervention will have an irreparable material adverse effect on Tenant’s operations at the
Premises, or City determines that such Law Enforcement Intervention will create risks
unacceptable to the City, Tenant or City, as applicable, shall have the right, but not the obligation,
to terminate the Lease, by delivering written notice of termination to the other party. Such
termination shall be effective on the date that Tenant vacates the Premises, which shall be within
the deadline set by applicable law enforcement, or, if none, then within ten (10) days of such notice.
IN WITNESS WHEREOF, each of the parties hereto has executed this Addendum
(Exhibit B to Lease) as of the date written above.
Doc ID: 70d55cb740cd0b1eb8cb6fbb2bc5176224afb0c6
Exhibit B
3
CITY:
City of Ukiah, California
By: _________________________
Name: _Sage Sangiacomo______
Title: City Manager___________
TENANT:
Plant Road Farming, LLC
By:
Name:
Title:
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4
EXHIBIT C
MINIMUM INSURANCE
REQUIREMENTS
Tenant shall maintain insurance against claims for injuries to persons or damages to property, which
may arise from or in connection with their performance under this Agreement.
A. Minimum Scope of Insurance
Coverage shall be at least as broad as:
1. Insurance Services Office ("ISO) Commercial General Liability Coverage Form
No. CG 00 01 11 85.
2. Worker's Compensation Insurance as required by the Labor Code of the State of
California and Employers Liability Insurance.
B. Minimum Limits of Insurance
Tenant shall maintain limits no less than:
1. General Liability: $1,000,000 combined single limit per occurrence for bodily
injury, personal injury and property damage. If Commercial General Liability
Insurance or other form with a general aggregate limit is used, the general
aggregate limit shall apply separately to the work performed under this Agreement,
or the aggregate limit shall be twice the prescribed per occurrence limit.
2. Worker's Compensation and Employers Liability: Worker's compensation limits
as required by the Labor Code of the State of California and Employers Liability
limits of $1,000,000 per accident.
C. Deductibles and Self-Insured Retentions
Any deductibles or self-insured retentions must be declared to and approved by the City.
At the option of the City, either the insurer shall reduce or eliminate such deductibles or
self-insured retentions as respects to the City, its officers, officials, employees and
volunteers; or the Tenant shall procure a bond guaranteeing payment of losses and related
investigations, claim administration and defense expenses.
D. Other Insurance Provisions
The policies are to contain, or be endorsed to contain, the following provisions:
1. General Liability Coverage
a. The City, its officers, officials, employees and volunteers are to be
covered as additional insureds as respects; liability arising out of activities
performed by or on behalf of the Tenant, products and completed
operations of the Tenant, premises owned, occupied or used by the Tenant,
or automobiles owned, hired or borrowed by the Tenant. The coverage
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5
shall contain no special limitations on the scope-of-protection afforded to
the City, its officers, officials, employees or volunteers.
b. The Tenant's insurance coverage shall be primary insurance as respects to
the City, its officers, officials, employees and volunteers. Any insurance
or self-insurance maintained by the City, its officers, officials, employees
or volunteers shall be excess of Tenant’s insurance and shall not contribute
with it.
c. Any failure to comply with reporting provisions of the policies shall not
affect coverage provided to the City, its officers, officials, employees or
volunteers.
d. Tenant’s insurance shall apply separately to each insured against whom
claim is made or suit is brought, except with respect to the limits of the
insurer's liability.
2. Worker's Compensation and Employers Liability Coverage
The insurer shall agree to waive all rights of subrogation against the City, its
officers, officials, employees and volunteers for losses arising from Tenant's
performance of the work, pursuant to this Agreement.
3. All Coverages
Each Insurance policy required by this clause shall be endorsed to state that
coverage shall not be suspended, voided, canceled by either party, reduced in
coverage or in limits except after thirty (30) days prior written notice by certified
mail, return receipt requested, has been given to the City.
E. Acceptability of Insurers
Based on Tenant’s representation that Insurance with admitted California insurers is
currently unavailable for the Permitted Use, the City will accept an insurer that is an eligible
surplus lines carrier in California with the following minimum standards or greater: (i)
A.M. Best's rating of no less than A-VII for financial strength and, (ii) no less than A- for
long-term credit worthiness
If, during the Lease term, coverage for the Permitted Use from an insurer admitted in
California becomes commercially available to Tenant on reasonable terms and meeting the
required coverages, limits, and endorsements of this Lease, Tenant shall procure such
admitted coverage at the next renewal of the applicable policy(ies). City may reasonably
request documentation supporting commercial availability (e.g., a broker letter and/or
quotes from admitted carriers). Tenant shall not be required to cancel coverage mid-term
solely to transition from surplus lines to admitted coverage.
Tenant may replace an insurer without City approval provided the replacement insurer
meets the requirements of this Section and coverage remains continuous and not materially
reduced. Tenant shall provide updated certificates of insurance and required endorsements
to City within ten (10) business days after binding the replacement coverage.
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F. Verification of Coverage
Tenant shall furnish the City with certificates of Insurance and with original Endorsements affecting
coverage required by this Agreement. The Certificates and Endorsements for each insurance policy are to
be signed by a person authorized by that insurer to bind coverage on its behalf. The Certificates and
Endorsements are to be on forms provided or approved by the City. Where by statute, the City's Workers'
Compensation - related forms cannot be used, equivalent forms approved by the Insurance Commissioner
are to be substituted. All Certificates and Endorsements are to be received and approved by the City
before Tenant begins the work of this Agreement. The City reserves the right to require complete,
certified copies of all required insurance policies, at any time. If Tenant fails to provide the coverages
required herein, the City shall have the right, but not the obligation, to purchase any or all of them. In that
event, the cost of insurance becomes part of the compensation due the contractor after notice to Tenant
that City has paid the premium.
Doc ID: 70d55cb740cd0b1eb8cb6fbb2bc5176224afb0c6
Plant Road Leasee
Plant_Rd_Farming_..._signed__002_.pdf
70d55cb740cd0b1eb8cb6fbb2bc5176224afb0c6
MM / DD / YYYY
Signed
01 / 07 / 2026
18:37:26 UTC
Sent for signature to Joshua Keats
(joshua@henrysoriginal.com) from julie@heritagecal.com
IP: 12.10.43.238
01 / 07 / 2026
18:43:00 UTC
Viewed by Joshua Keats (joshua@henrysoriginal.com)
IP: 104.28.123.180
01 / 07 / 2026
18:43:26 UTC
Signed by Joshua Keats (joshua@henrysoriginal.com)
IP: 104.28.123.180
The document has been completed.01 / 07 / 2026
18:43:26 UTC