HomeMy WebLinkAboutMOORE PRODUCTION LLCPBA5/8/2025
Contract NumberNameDESCRIPTIONExpiration DateOK to terminate? Y/NIf Y, please sign
A-2017-369-81MOORE PRODUCTION LLCCOMMERCIAL CANNABIS BUSINESS12/31/2022YAP
A-2017-369-26MVM MAUFACTURING INC. DBA GREEN MAGICCANNABIS RETAIL BUSINESS12/31/2022YAP
A-2015-103NABIH YOUSSEF ASSOCIATESSTRUCTURAL PLAN CHECK SERVICES FOR "ONE BRODAY PLAZA" PROJECT6/30/2018YFV
A-2017-369-20NEWTONIAN PRINCIPLES, INC.COMMERCIAL CANNABIS BUSINESS12/31/2020YAP
A-2017-391NEWTONIAN PRINCIPLES, INC.COMMERCIAL CANNABIS BUSINESS12/31/2022YAP
A-2017-369-48NEWTONIAN PRINCIPLES, INC. DBA PLANET 13 ORANGE COUNTYCOMMERCIAL CANNABIS BUSINESS12/31/2022YAP
A-2017-369-51NEWTONIAN PRINCIPLES, INC. DBA PLANET 13 ORANGE COUNTYCOMMERCIAL CANNABIS BUSINESS12/21/2022YAP
A-2017-369-34NO STRESS GENETICS, LLC.COMMERCIAL CANNABIS BUSINESS12/31/2022YAP
N-2019-105-01OC HUMAN RELATIONSFIRST EXTENSION/RESOLUTION TRAINING.SUPPORT FOR SANTA ANA NEIGHBORHOODS12/31/2020YFV
A-2017-369-17OGC SYSTEMS INC., A MUTUAL BENEFIT CORPORATIONCOMMERCIAL CANNABIS BUSINESS12/31/2020YAP
A-2017-381OGC SYSTEMS INC., A MUTUAL BENEFIT CORPORATIONCOMMERCIAL CANNABIS BUSINESS12/31/2020YAP
A-2017-369-57OGC SYSTEMS INC., DBA GREEN MONKEY COMMERCIAL CANNABIS BUSINESS12/31/2022YAP
A-2017-369-64OGC SYSTEMS, INC. DBA NEW GENERATIONCOMMERCIAL CANNABIS BUSINESS12/31/2022YAP
A-2017-369-50OKIE TOKIE, LLC.COMMERCIAL CANNABIS BUSINESS12/31/2022YAP
A-2017-369-37ROYAL M&D LLC.OPERATING AGREEMENT FOR NON-RETAIL COMMERICIAL CANNABIS BUSINESSES12/31/2022YAP
A-2017-369-73SPEEDY WEEDY SANTA ANA, LLCOPERARTING AGREEMENT FOR ADULT-USE AND MEDICAL RETAIL COMMERICIAL CANNABIS12/31/2022YAP
A-2013-172CUTILITY CABINET PILOT ART PROGRAM - VARIOUS ARTISTS MEDINA, FEDERICOUTILITY CABINET PILOT ART PROGRAM3/10/2014YFV
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(M- P') �A
NOT ON FILE
` iLOT PROCEED
_ERK OF COUNCIL
GATE:
OPERATING AGREEMENT FOR NON -RETAIL
COMMERCIAL CANNABIS BUSINESSES
A-2017-369-81
This Operating Agreement ("AGREEMENT') is dated September 13, 2022 between the
City of Santa Ana, a charter city and municipal corporation ("CITY") and MOORE PRODUCTION
LLC ("OPERATOR"), collectively referred to as "the Parties'. This AGREEMENT shall become
effective on the date that OPERATOR is issued a Regulatory Safety Permit by CITY for the
operation of a commercial cannabis business conducting ADULT -USE AND/OR MEDICINAL
CULTIVATION services in whole or in part of its operations transacted and carried -on by
OPERATOR at the following subject property location: 3701 W. Moore Avenue, Santa Ana, CA
92704
1. Public Benefit.
A. Intent. The purpose of this Operating AGREEMENT is to ensure positive
community impacts from commercial cannabis business operations through local hiring and
local sourcing, community benefit and sustainable business practices, and the collection of
required fees and taxes as applicable for the operation of a commercial cannabis business
and to provide mitigation options to be used by CITY to compensate for impacts to CITY
services, residents, and/or businesses as set forth in Santa Ana Municipal Code Chapter 40.
The Parties agree that this AGREEMENT confers substantial private benefits on
OPERATOR which should be balanced by commensurate public benefits. As part of the
cannabis Regulatory Safety Permit process, OPERATOR agrees to enter into this
AGREEMENT. OPERATOR acknowledges that CITY and OPERATOR have had extensive
negotiations and proceedings prior to entering into this AGREEMENT. OPERATOR has
elected to execute this AGREEMENT as it provides OPERATOR with important economic
benefits. Accordingly, the Parties intend to provide consideration to the public to balance
the private benefits conferred on OPERATOR by providing mitigation measures to the public
and to pay for CITY services.
B. Local Hiring and Sourcing. OPERATOR agrees to use its reasonable efforts to
hire qualified City of Santa Ana residents living in Santa Ana to work at its commercial
cannabis businesses. OPERATOR shall also use reasonable efforts to retain the services
of qualified contractors and suppliers who are located in the City of Santa Ana or who
employ a significant number of City of Santa Ana residents. OPERATOR shall make a good
faith effort to advertise on various social media sites, at local job fairs, and through public
agencies and organizations.
C. Community Benefit and Sustainable Business Practices Plan. OPERATOR
agrees to submit a Community Benefit and Sustainable Business Practices Plan ('Plan") to
CITY that is hereby attached and incorporated into this AGREEMENT as ("EXHIBIT A").
Said Plan shall detail OPERATOR's experience working with community -based groups
such as school districts, college districts, city or county agencies, non-profit organizations,
artist or downtown groups. The Plan shall also include a description of OPERATOR's
efforts for recruiting and hiring local persons and businesses. Said Plan must also outline
commitments by OPERATOR to engage its staff in community service events or programs
in the City of Santa Ana. Plan must also outline and address sustainable business
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practices. OPERATOR shall adequately document that it has met the Plan's obligations
and commitments as a condition of renewal/extension of this AGREEMENT upon expiration
of the initial term and any extensions.
-- 2. Records Inspection, Examination and Audit.
OPERATOR acknowledges and agrees that CITY is empowered under this Agreement
to inspect, examine and audit OPERATOR's books and records (including tax filings and
returns), to ascertain the amount of operating fees due and owing. CITY or its authorized
agents shall have the power and authority to conduct a full inspection, examination and
audit of such books and records (including tax filings and returns) at any reasonable time,
including but not limited to, during normal business hours. In the event any such books,
records, tax filings and returns cannot be made fully available within the City of Santa Ana,
OPERATOR acknowledges and agrees that it shall reimburse CITY for the cost of all
transportation, lodging, meals, portal-to-portal travel time, and other incidental costs
reasonably incurred by CITY or its authorized agents in obtaining said full inspection,
examination and audit. In the event that said records inspection, examination and audit
determines that a net operating agreement fee payment deficiency of greater than Five
Percent (5%) exists; OPERATOR acknowledges and agrees that it shall reimburse CITY for
the full cost of said records inspection, examination and audit reasonably incurred by CITY
or its authorized agents.
3. Term.
This AGREEMENT shall start on the date indicated above and shall terminate on
December 31, 2022 regardless of starting date unless terminated earlier in accordance with
Section 9 or 10 of this AGREEMENT.
4. Business License Required.
A valid City of Santa Ana Business License is required for all persons engaged in
transacting and carrying on any commercial cannabis business activity in the City of Santa
Ana. It is unlawful for any person or legal entity to commence, transact or carry -on cannabis
business activity in the City of Santa Ana without first having procured a City of Santa Ana
cannabis business license.
5. Operating Commercial Cannabis Business.
OPERATOR shall not operate a commercial cannabis business authorized under the
Santa Ana Municipal Code unless:
A. It is the holder of a valid Regulatory Safety Permit issued by CITY in accordance with
the procedures and requirements of Article 1 of Chapter 40, of the Santa Ana
Municipal Code; and
B. At such time as the State of California requires cannabis business facilities and
businesses to hold a valid license or permit issued by the State of California, it also
holds such license or permit; unless, however, such permit or license is subsequently
not required by the State of California for the type of cannabis facility or business
operation that is the subject of this AGREEMENT.
C. OPERATOR remains in compliance with any and all other laws and regulations
pertaining to commercial cannabis businesses.
-- D. OPERATOR shall remain in compliance with the operating requirements applicable
to commercial cannabis businesses contained in the City's Municipal Code.
6. OPERATOR Indemnification of CITY.
A. OPERATOR will indemnify CITY from any claims, damages, injuries, or liabilities of
any kind whatsoever sustained or incurred by CITY resulting from entering into this
AGREEMENT, and OPERATOR's performance and/or breach of this AGREEMENT.
B. OPERATOR agrees to defend, at its sole expense, any action against CITY, its
agents, officers, and employees related to this AGREEMENT. OPERATOR agrees
to indemnify and reimburse CITY for any court costs and attorney fees that CITY
may be required to pay as a result of any legal challenge related to this
AGREEMENT and/or CITY's approval of a Regulatory Safety Permit. CITY may, at
its sole discretion, participate at its own expense in the defense of any such action,
but such participation shall not relieve the OPERATOR of its obligation hereunder.
OPERATOR Compliance with Laws.
OPERATOR agrees to comply with the City of Santa Ana Charter and Municipal Code,
including but not limited to Chapters 18, 21 and 40, and the laws and regulations of the
State of California.
8. Default and Termination for Cause.
This AGREEMENT may be terminated by CITY for cause with thirty (30) days' written
notice to OPERATOR. Cause as used in this section. is defined as:
A. Failure to comply with the terms of the City of Santa Ana Cannabis Regulatory
Safety Permit issued to OPERATOR by CITY;
B. Failure of OPERATOR to maintain a valid active City of Santa Ana Business License
as the commercial cannabis business approved by the Regulatory Safety Permit and
as operating;
C. Failure of OPERATOR to comply with the requirements of the Community Benefits
and Sustainable Business Practices Plan;
D. Unauthorized transfer by OPERATOR of the City of Santa Ana cannabis business
Regulatory Safety Permit issued by CITY;
E. Failure by OPERATOR to accurately report gross receipts information or other data
necessary for CITY to calculate/confirm operating agreement fees;
F. Failure by OPERATOR to pay operating agreement fees and related reimbursement
costs within thirty (30) days of the date those fees are due;
G. Failure by OPERATOR to cooperate with CITY or CITY's authorized agents in any
inspection, examination and audit of OPERATOR's commercial cannabis business
books and records (including tax filings and returns).
H. OPERATOR shall cure the default resulting from the cause for termination within
thirty (30) days of the date of the notice of termination. If OPERATOR fails to cure
the default within thirty (30) days of the date of the notice of termination for cause,
this AGREEMENT will be terminated.
I. This AGREEMENT will automatically terminate if:
i. OPERATOR's Regulatory Safety Permit is revoked by CITY or is not renewed by
CITY, or
ii. OPERATOR transfers its Regulatory Safety Permit pursuant to Santa Ana
Municipal Code section 40-12,
9. Termination Without Cause.
Upon mutual written agreement of the Parties, this AGREEMENT may be terminated
with thirty (30) days' notice.
10. Termination - Effect on Prior Obligations.
Upon any termination of this AGREEMENT, OPERATOR's obligation to report and remit
operating agreement fees due and payable under the terms of this AGREEMENT for each
month or fraction of a month of a cannabis business operation engaged in within the City of
Santa Ana prior to termination of this AGREEMENT shall continue to be in effect. Past due
penalties and late interest charges shall continue to accrue and be applicable until all
operating fees due under this AGREEMENT are paid in full. OPERATOR's liability for any
remaining unpaid past due penalties and/or late interest charges shall continue until fully
satisfied.
11. Remedies.
A. It is acknowledged by the parties that CITY would not have entered into this
AGREEMENT if it were to be liable in damages under this AGREEMENT, or with
respect to this AGREEMENT or the application thereof, except as hereinafter
expressly provided.
B. Each of the parties hereto may pursue any remedy at law or equitable relief available
for the breach of any provision of this AGREEMENT, except that CITY shall not be
liable in monetary damages, unless expressly provided for in this AGREEMENT.
C. Any dispute, claim or controversy arising out of or relating to this Agreement or the
breach, termination, enforcement, interpretation or validity thereof, including the
determination of the scope or applicability of this agreement to arbitrate, shall be
determined by arbitration in Orange County California before three arbitrators. The
arbitration shall be administered by JAMS pursuant to its Comprehensive Arbitration
Rules and Procedures pursuant to JAMS' Streamlined Arbitration Rules and
Procedures. Judgment on the Award may be entered in any court having jurisdiction.
This clause shall not preclude parties from seeking provisional remedies in aid of
arbitration from a court of appropriate jurisdiction.
12. Reimbursement Clause.
In consideration of the time and costs incurred by CITY in the drafting and
implementation of this AGREEMENT, OPERATOR agrees to pay $2,500 to CITY within
thirty (30) days of execution of this AGREEMENT.
13. Attorney Fees and Costs.
In any action or proceeding between CITY and OPERATOR brought to interpret or
enforce this AGREEMENT, or which in any way arises out of the existence of this
AGREEMENT or is based upon any term or provision contained herein, the "prevailing
party" in such action or proceeding shall be entitled to recover from the non -prevailing party,
in addition to all other relief to which the prevailing party may be entitled pursuant to this
AGREEMENT, the prevailing party's reasonable attorneys' fees and litigation costs, in an
amount to be determined by the court. The prevailing party shall be determined by the court
in accordance with California Code of Civil Procedure Section 1032. Fees and costs
recoverable pursuant to this Section 17 include those incurred during any appeal from an
underlying judgment and in the enforcement of any judgment rendered in any such action or
proceeding.
14. Notice.
Any notice, tender, demand, delivery, or other communication pursuant to this
AGREEMENT shall be in writing and shall be deemed to be properly given if delivered in
person or mailed by first class or certified mail, postage prepaid, or sent by fax or other
telegraphic communication in the manner provided in this section, to the following persons:
To CITY: Clerk of the City Council
City of Santa Ana
20 Civic Center Plaza (M-30)
P.O. Box 1988
Santa Ana, CA 92702-1988
Fax 714-647-6956
Copies to: Executive Director— Planning and Building Agency
City of Santa Ana
20 Civic Center Plaza (M-20)
P.O. Box 1988
Santa Ana, California 92702-1988
Fax 714-973-1461
City Attorney
City of Santa Ana
20 Civic Center Plaza (M-29)
P.O. Box 1988
Santa Ana, California 92702-1988
Fax 714-647-6515
To OPERATOR: 3701 MOORE PRODUCTION LLC
3701 W MOORE AVE
SANTA ANA, CA 92704
(949) 357-9873
hsraymondcheng@gmail.com
A party may change its address by giving signed notice in writing to the other party.
Thereafter, any communication shall be addressed and transmitted to the new address. If
sent by mail, communication shall be effective or deemed to have been given three (3) days
after it has been deposited in the United States mail, duly registered or certified, with
postage prepaid, and addressed as set forth above. If sent by fax or email document
attachment, communication shall be effective or deemed to have been given twenty-four
(24) hours after the time set forth on the transmission report issued by the transmitting
facsimile machine, addressed as set forth above. For purposes of calculating these time
frames, weekends, federal, state, County or City holidays, or City Hall closure dates shall be
excluded.
15. Exclusivity and Amendment.
This AGREEMENT represents the complete and exclusive statement between CITY and
OPERATOR, and supersedes any and all other agreements, oral or written, between the
parties. This AGREEMENT may not be modified except by written instrument signed by
CITY and by an authorized representative of OPERATOR. Each party to this AGREEMENT
acknowledges that no representations, inducements, promises or agreements, orally or
otherwise, have been made by any party, or anyone acting on behalf of any party, which are
not embodied herein.
16. Assignment.
OPERATOR may not assign or transfer any interest herein without the prior written
consent of CITY and any such assignment or transfer without CITY's prior written consent
shall be considered null and void.
17. Discrimination.
OPERATOR shall not discriminate because of race, color, creed, religion, sex, marital
status, sexual orientation, age, national origin, ancestry, disability, gender identity, gender
expression, medical condition, genetic information, military or veteran status, as defined and
prohibited by applicable law, in the recruitment, selection, training, utilization, promotion,
termination or other employment related activities. OPERATOR affirms that it is an equal
opportunity employer and shall comply with all applicable federal, state and local labor laws
and regulations.
18. Jurisdiction -Venue.
This AGREEMENT has been executed and delivered in the State of California and the
validity, interpretation, performance, and enforcement of any of the clauses of this
AGREEMENT shall be determined and governed by the laws of the State of California.
Both parties further agree that Orange County, California, shall be the venue for any action
or proceeding that may be brought or arise out of, in connection with or by reason of this
AGREEMENT.
19. Severability.
If any part of this AGREEMENT is found to conflict with applicable local or state laws or
regulations, such part shall be inoperative, null and void insofar as it conflict with said laws
or regulations, or may be modified or suspended as may be necessary to comply with any
local or state law or regulation but the remainder of the AGREEMENT shall continue in full
force and effect.
20. Counterparts.
This AGREEMENT may be executed in counterparts, each of which shall be deemed
an original but all of which together shall constitute one and the same instrument. The
execution of this AGREEMENT may be by actual, facsimile or electronic signature.
21. Disclaimer.
Despite California's commercial cannabis laws and the terms and conditions of this
AGREEMENT or any Regulatory Safety Permit issued pertaining to OPERATOR or the
hereinabove specified property location, California commercial cannabis cultivators,
transporters, distributors, cannabis testing facility/laboratory businesses or possessors may
still be subject to arrest by state or federal officers and prosecuted under state or federal
law. The Federal Controlled Substances Act, 21 USC § 801 et. seq., prohibits the
manufacture, manufacturing, and possession of cannabis without any exemptions for
medical or non -medicinal use.
22. Authority to Bind.
Each undersigned represents and warrants that its signature hereinbelow has the
power, authority and right to bind their respective parties to each of the terms of this
AGREEMENT, and shall indemnify CITY fully, including reasonable costs and attorney's
fees, for any injuries or damages to CITY in the event that such authority or power is not, in
fact, held by the signatory or is withdrawn.
-Signature Page Below-
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A-2017-369-81
IN WITNESS WHEREOF, the parties hereto have executed this AGREEMENT the date and year
first above written.
ATTEST:
'&.
Clerk of the Council
APPROVED AS TO FORM:
SONIA R. CARVALHO
City Attorney
By: � m
Jose Montoya
Assistant City Attorney
RECOMMENDED FOR APPROVAL:
0
Minh Thai, Executive Director
Planning & Building Agency
CITY OF SAN//TA ANA
V L � Q r—
KRISTINE RIDGE
City Manager
OPERATOR
LEGAL NAME: 3701 Moore Production LLC
SIGNATORY
NAME: Raymond Cheng
TITLE: Partner
TAXPAY,F,Pob: 87-3078 358
EXHIBIT A
COMMUNITY BENEFIT AND SUSTAINABLE BUSINESS PRACTICES PLAN
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EMPLOYEE CARE
A Santa Ana company should be a Santa Ana company through and through, In this conception,
we believe that the impetus is on us to hire employees from a pool of Santa Ana residents to the
fullest extent possible. 3701 Moore Production has the following benchmarks in mind of our local
hiring imperative:
• January 1, 2023: 75% employees from Santa Ana
• January 1, 2025: 85% employees from Santa Ana
• January 1, 2027: 100% employees from Santa Ana
While these are benchmarks we aim for, we intend to undertake several steps to meet them
including working with the City, engaging with local workforce centers, and developing and
utilizing targeted hiring practices, as well as annual reviews of our local hiring efforts and
results.
In order to retain local employees at the specified target of 90%, we must offer competitive
salaries and benefits packages. As caring community stewards, we are prepared to offer the
following total compensation packages to our employees:
• Hourly salary ranges at a minimum base of $18.00, and up from there for salaried
oversight positions (minimum hourly wage based on for a living wage in Orange County,
CA per MIT)'
• Several health insurance plan choices, along with HSA/FSA add-ons
i Dental and vision care plans
• 120 hours of paid time off in the first 3 years, 160 hours in the 3-5 years of employment
service period, and 200 for 5 years of service or more
• Wellness incentives programs (gym membership subsidization, preventative screening
coverage, etc.
Y Continuing education coverage (tuition reimbursement, workshop attendance
sponsorship, scholarship opportunity support)
• Retirement fund management and general budgetary support service support
ENVIRONMENTAL CARE
If the last decade in California as taught residents and businesses anything, it is the necessity of
taking forceful and decisive action to protect the weather and geography of the State — and city —
we all love. Droughts and 100+ degree weather not a future anyone wants. Thus, 3701 Moore
Production LLC sees the following incredibly important actions it must take that will have
substantial impacts in environmental arenas where they are most needed:
• Energy
o Efficiency
3701 Moore Production aims to reduce our carbon footprint and strain on the
energy grid. We have purpose engineered our facility to maximize our per sf
production efficiency.
• During the plan check process, we made the decision to convert from HIPS
to high efficiency LED grow lights which use 50% less energy than
traditional HID lights. This also leads to a reduction in HVAC load and
ultimately the load on the electrical grid,
• The use of LED lights also allows us to ultimately double the
potential production output of the facility when we complete all
This hourly rate does not include performance bonuses tied to production output and efficiency.
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construction phases under the same square feet of usable
floor space.
• Implement incentives for employees to carpool, bike, or use public
transportation to work at level of at least 50%
• Use all and only EnergyStar appliances were needed (employee
breakrooms, industrial purpose options)
• Water
o Usage of high efficiency irrigation techniques to reduce the amount of
runoff and wastewater, ultimately reducing our water consumption. Our
goal is to eliminate runoff entirely by dialing in our irrigation strategy and
implementing a recirculating fertigation system by 2028,
COMMUNITY CARE
We are no less active in our support of local community organizations as we in our commitment
to Employee and Environmental Care. Thus, we pledge to donate up to 20 volunteer hours a
quarter across identified areas of need in Santa Ana. We understand that "issue areas" where
support is needed change over time, and we must tie our growth and success to that of the
community. With that in mind, we will aim to increase our volunteer hours up to 30 hours per a
quarter by year 2025, and 40 hours a quarter by year 2028.
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