Agenda packet — Belmont City Council, April 8, 2025 (part 1 of 3)

CITY OF BELMONT

CITY COUNCIL
www.belmont.gov

CITY COUNCIL REGULAR MEETING AGENDA
Tuesday, April 8, 2025
6:00 PM
City Council Chambers
City Hall, One Twin Pines Lane, Belmont, California
MEETING ATTENDANCE:

Council meetings, unless otherwise noted, are broadcast live to Belmont residents on

1. Comcast Cable Channel 27

2. Streamed live via the City’s website at Belmont.gov,

3. ZOOM https://belmont- gov.zoom.us/ Meeting ID: 95745673035

4. Public may attend the meeting in the Council Chambers, Belmont City Hall 2nd floor PUBLIC COMMENT:

Public in the Council Chamber present the Clerk a request to speak slip found at the table at the rear of the chamber.

If participating virtually use the Raise Hand feature to request to speak.

For dial- in comments, call *67 1-(669) 900-6833 (your phone number will appear on the live broadcast if *67 is not dialed prior to the phone number), enter Meeting ID: 95745673035, and press *9 to request to speak.

All public comments are subject to a 3-minute time limit unless otherwise determined by the Chair.

If you wish to submit written public comment, you may send an email to [email protected] before the council considers the item. Please indicate the agenda item topic or agenda item number you wish to comment on in your email’s subject line. Any public comment regarding agenda items that are received from the time of publication of the agenda and 3 hours before the start of the meeting will be distributed to the Council prior to the meeting and made part of the meeting record. Written public comments will not be read during the Council meeting.

The Mayor has the authority to rule any speaker out of order, including speakers during the Public Comment period; If the subject raised is not within the subject matter jurisdiction of the City Council, during a public hearing or a general business item if the speaker is not presenting testimony or evidence relevant to the matter or if the speaker becomes disruptive to the proceedings and conduct of the meeting.

The Mayor also has the authority to order any person who willfully interrupts the meeting to be removed. All persons are expected to conduct themselves with civility and courtesy at all times. All 1 1. CALL TO ORDER [6:45 PM]

2. ROLL CALL

3. CLOSED SESSION

4. STUDY SESSION [none]

5. PLEDGE OF ALLEGIANCE

6. REPORT FROM CLOSED SESSION

7. SPECIAL PRESENTATIONS
A. Proclamation Recognizing April as National Poetry Month

8. PUBLIC COMMENTS ON ITEMS NOT ON THE AGENDA
persons giving comments shall speak directly to the Council and address issues, not individuals.

Personal attacks, cursing and outbursts from the audience in support or opposition to a speaker are not tolerated in order to foster an environment where everyone feels welcome to speak.

LEVINE ACT
The Levine Act (California Government Code Section 84308) limits campaign contributions that may be made to elected or appointed City officials (including councilmembers and the mayor) and certain candidates for elective city offices. The Act prohibits an agent of a party from contributing any amount to councilmember while a proceeding for a contract valued at $50,000 or more, permit, license, or other entitlement for use is pending that does not solely involve purely ministerial decisions. The Act also prohibits parties and participants in the above entitlement proceedings from contributing more than $500 during the proceeding and for 12 months after the proceeding and requires disclosure of the prohibited contributions. The Act prohibits certain officials, including local elected officials, from taking part in an entitlement proceeding if the official has received a contribution exceeding $500 from a party or participant in the proceeding within the preceding 12 months. An official is also prohibited from accepting, soliciting, or directing a contribution exceeding $500 from a party or participant in the proceeding for 12 months after a final decision is rendered in such a proceeding. The law is complex, and this brief description is not legal advice. If you or an agent have made any campaign contributions to a councilmember in the 12 months before a proceeding in which you have an interest or you are contemplating making a contribution within the 12 months after such a proceeding, you are urged to review the Levine Act and consider consulting an attorney. The California Fair Political Practices Commission (FPPC) is responsible for administering the Levine Act. More information about the Act and its implementing regulations can be found on the FPPC’s website here:
https://www.fppc.ca.gov/learn/pay-to-play-limits-and-prohibitions.html

CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION
Initiation of litigation under Government Code Section 54956.9(d)(4): 1 case The public will have an opportunity to address the City Council concerning this item.

REGULAR BUSINESS ITEMS 7:00 P.M.

This portion of the meeting is reserved for persons wishing to address the Body on any City matter not on the agenda. The period for public comment at this point in the agenda is limited to 15 minutes, with a maximum of 3 2 9. COUNCILMEMBER ANNOUNCEMENTS

10. CONSENT BUSINESS
A. Approval of Minutes
B. 1538 El Camino Real – Rezone to S-3 Overlay District, Development Agreement, Conditional Use Permit, Design Review
C. 1397 El Camino Real & APN 045-243-050 – Rezone to S-3 Overlay District, Development Agreement, Conditional Use Permit, Design Review D. 2025 Pavement Rehabilitation Project – Plans and Specifications Approval, Bid and Construction Award Authorization, and Construction Management Task Order Authorization
minutes per speaker. Speakers who requested but did not receive an opportunity to speak during this comment period will be given an opportunity to address the Body later in the meeting. State law prohibits the Body from acting on non-agenda items.

Consent business items are considered to be routine in nature and will be enacted by one motion. There will be no separate discussion on these items unless a member or staf request specific items to be removed for separate action.

The City Attorney will read the title of ordinances to be adopted.

Recommendation: Consider modifications and approve minutes Attachment(s):

March 11, 2025
Recommendation: 1) Adopt an Ordinance rezoning 1538 El Camino Real into the S-3 Cannabis Overlay District; and,
2) Adopt an Ordinance approving a development agreement for the NUG Retail Cannabis Dispensary Business; and,
3) Adopt a Resolution approving a Conditional Use Permit and Design Review for the NUG Retail Cannabis Dispensary Business for the subject property Attachment(s):

Staff Report
1538 ECR - NUG Rezone Ord & Zoning Basemap Amendment
1538 ECR - NUG Development Agreement Ord & DA
1538 ECR - NUG - CUP & DR Resolution & COAS
Recommendation: 1) Adopt an Ordinance rezoning 1397 El Camino Real & APN 045-243- 050 into the S-3 Cannabis Overlay District; and,
2) Adopt an Ordinance approving a development agreement for the Canna-Bel Retail Cannabis Dispensary Business; and,
3) Adopt a Resolution approving a Conditional Use Permit and Design Review for the Canna-Bel Retail Cannabis Dispensary Business for the subject properties Attachment(s):

Staff Report
1397 ECR - Canna-Bel Rezone Ord & Zoning Basemap Amendment 1387 ECR - Canna-Bel Development Agreement Ord & DA
1397 ECR - Canna-Bel - CUP & DR Resolution
Recommendation: Adopt a resolution approving plans and specifications, authorizing advertisement for sealed bids, authorizing the City Manager to negotiate and execute a contract with the lowest responsible and responsive bidder for an amount not to exceed 3 11. PUBLIC HEARINGS [none]

12. GENERAL BUSINESS
A. Update on Belmont’s Pavement Management Program

13. BRIEF VERBAL REPORTS FROM MEMBERS AND STAFF

14. MATTERS OF INTEREST/CLARIFICATION

15. ADJOURNMENT
$4,355,806 plus a ten percent construction contingency, and approving a task order for construction management services with Pavement Engineering Inc. for an amount not to exceed $559,295 for the 2025 Pavement Rehabilitation Project, City Contract Number 2025- 637
Attachment(s):

Staff Report
Resolution
Project Plans
PEI Proposal
Contract Documents
General Business items are considered separately, typically in the order listed. The chair will call for public comment on each item when the body considers the item.

Recommendation: Receive an update on Belmont’s Pavement Management Plan and the condition of Belmont’s roadways, following the completion of our Pavement Distress Survey. This is an information report, and no action is required Attachment(s):

Staff Report
PTAP Report
A. Verbal report from Councilmembers on Intergovernmental (IGR) and Subcommittee Assignments
B. Verbal report from City Manager
Items in this category are for discussion and direction to staf only. However, Council/Board may take final action on an item if there is no need for additional staf analysis.

AGENDAS: Agendas and material are posted on the City’s website on the Friday preceding each Council Meeting and can be viewed on the City's website at www.cityofsanmateo.org. Any supplemental material distributed to the Council after the posting of the agenda will be made part of the official record.

ACCESSIBILITY: In compliance with the Americans with Disabilities Act, those with disabilities requiring special accommodations to participate in this meeting may contact the City Clerk at (650) 595-7414. Notification 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting.

AGENDA POSTING: I declare a copy of this agenda was posted at City Hall, One Twin Pines Lane, and the City's website www.belmont.gov on ,by . /s/
4 City Council
Meeting Minutes
March 11, 2025
1 CITY OF BELMONT CITY COUNCIL REGULAR MEETING MINUTES
City Council Chambers, City Hall, One Twin Pines Lane, Belmont, California Tuesday, March 11, 2025
CALL TO ORDER [7:00 p.m.]

ROLL CALL
Councilmembers Present: Latimerlo, McCune, Jordan, Pang-Maganaris, Mates Councilmembers Absent: none
CLOSED SESSION [none]
STUDY SESSION [none]

PLEDGE OF ALLEGIANCE
Led by Mayor Mates
REPORT FROM CLOSED SESSION [none]

SPECIAL PRESENTATIONS
Third Annual Dr. Martin Luther King, Jr. Poetry & Essay Contest Recitals The following students recited their winning submissions.

Grades 3-5th
Poetry: Victoria Li
Essay: Arjun Popuri
Grades 6-8th
Poetry: Ellie Howard
Essay: Theofanis Karabelas
Grades 9-12th
Poetry: Grace Stiefel
Essay: Raya Skaf
Public comment
Giuliano Carlini offered congratulatory comments to the writers.

Proclamation Honoring Retiring San Mateo Consolidated Fire Chief Thrasher Mayor Mates read a proclamation honoring Chief Thrasher on his retirement.

Councilmember and staff offered congratulation to Chief Thrasher. 5 City Council
Meeting Minutes
March 11, 2025
2 PUBLIC COMMENTS ON ITEMS NOT ON THE AGENDA
Giuliano Carlini commented on the need for childcare for volunteers participating in local sports programs. He acknowledged Footsteps for providing care without charge.

Max R. commented on a communication issue he is experiencing with the Planning Department.

COUNCILMEMBER ANNOUNCEMENTS
Councilmembers provided updates on upcoming events.

CONSENT BUSINESS
Approval of Minutes February 25, 2025
Monthly Financials December 2024 January 2025
Ordinance 2025-1183 establishing a state video franchise holder fee to support Public, Education, and Government (PEG) facilities and penalties of material breach of state and federal customer service standards
Motion authorizing the City Manager to negotiate and execute Amendment 3 to Task Order 1 with Moore Iacofano Goltsman, Inc. (MIG) to provide environmental monitoring and reporting services for the San Juan Pump Station Slope Repair Project for an additional amount of $6,496, for a total contract cost of a not-to-exceed amount of $101,366 Motion authorizing the City Manager to negotiate and execute an agreement to purchase a Vac-Con in the amount of $667,167.19 from Vac-Con Inc. through Municipal Maintenance Equipment
Resolution 2025-20 accepting the public improvements for the Firehouse Square Townhouse Project at 1300 El Camino Real as completed and complying with the City’s approved plans, authorize the release of the subdivision improvement bond and accept a maintenance and warranty bond for the required one-year warranty period City Attorney Rennie read the title of Ordinance 2025-1183 establishing a state video franchise holder fee to support Public, Education, and Government (PEG) facilities and penalties of material breach of state and federal customer service standards.

ACTION: On a motion made by Councilmember Pang-Maganaris and seconded by Councilmember Latimerlo the consent business was unanimously approved by a roll call vote (5-0).

PUBLIC HEARINGS [none]

GENERAL BUSINESS
State Legislative Advocacy for the City of Belmont - 2025 Update Dane Hutchings, City Consultant from the California Public Policy Group (CPPG), provided 6 City Council
Meeting Minutes
March 11, 2025
3 an overview of 2024 legislative actions impacting the City. He highlighted key legislative challenges, emphasizing housing affordability and budget concerns as ongoing priorities for municipalities.

Hutchings reviewed the City's Legislative Platform, incorporating input from City staff discussions. Proposed amendments were introduced in the areas of Fiscal and Administrative policies, Housing and Land Use, and Public Safety, serving as a foundation for Council discussion and direction to staff and CPPG.

Fiscal and Administrative Initiatives
New Proposed Statement:
"Support legislation that preserves the integrity of the local collective bargaining processes and maintains a level playing field for negotiations. Oppose measures that mandate specific benefits or terms that undermine the ability of local governments to engage in meaningful dialogue and reach mutually beneficial agreements with bargaining units." Housing and Land Use
New Proposed Statement:
"Support legislation that takes a comprehensive approach to housing production, recognizing all factors contributing to the State’s housing crisis, and works to close the economic gap, ensuring projects are feasible without imposing excessive financial burdens on cities."
Public Safety
Modified Statement:
"Support legislative efforts to improve local law enforcement, fire suppression and prevention, hazardous materials mitigation, rescue, emergency medical services, and disaster preparedness. This includes legislation and grant funding opportunities for innovative fire mitigation planning and suppression technology." New Proposed Statement:
"Support legislation that provides affordable home insurance rates for at-risk residents, including policies that stabilize the California FAIR Plan." Hutchings noted that the legislative platform remains an evolving document, to be updated at the start of each two-year session and reviewed annually to ensure continued alignment with City priorities.

Following deliberation Council concurred with the updated language.

ACTION: on a motion made by Councilmember Pang-Maganaris and seconded by Councilmember Jordan Belmont’s State and Federal Legislative Platform was reaffirmed as amended.
7 City Council
Meeting Minutes
March 11, 2025
4 Annual Report on Vacancies and Recruitment and Retention Efforts for 2024 Interim Administrative Assistant Ritzma provided a report on the City’s workforce vacancies, recruitment and retention efforts in compliance with Assembly Bill (“AB”) 2561. (Gov. Code § 3502.3.). She noted that the Council adopted a Vacancy Reporting Policy at the February 25, 2025 meeting to enhance transparency regarding City vacancies, recruitment efforts, and workforce challenges. Ne explained that the policy aims to improve public access to data on recruitment and retention while addressing challenges related to hiring policies and procedures.

Council received the report no deliberation occurred.

BRIEF VERBAL REPORTS FROM MEMBERS AND STAFF
Verbal report from Councilmembers on Intergovernmental (IGR) and Subcommittee Assignments
Councilmembers reported on their assignments.

Verbal report from City Manager
City Manager Oskoui provided updates on upcoming events and acknowledged the Council for a successful Strategic Planning Session. He announced that Belmont PD can be now followed on Instagram.

MATTERS OF INTEREST/CLARIFICATION
ADJOURNMENT at this time being 8:35 pm
Submitted by,
Jozi Plut, City Clerk
8 Meeting Date: April 8, 2025
Agency: City of Belmont
Staff Contact: Carlos de Melo, Community Development Director, (650) 595-7440 [email protected]
Agenda Title: 1538 El Camino Real – Rezone to S-3 Overlay District, Development Agreement, Conditional Use Permit, Design Review
Agenda Action: Ordinance and Resolution
Recommendation
1) Adopt an Ordinance rezoning 1538 El Camino Real into the S-3 Cannabis Overlay District; and, 2) Adopt an Ordinance approving a development agreement for the NUG Retail Cannabis Dispensary Business; and,
3) Adopt a Resolution approving a Conditional Use Permit and Design Review for the NUG Retail Cannabis Dispensary Business for the subject property.

Strategic Focus Area
Economic Development and Housing
Summary
At the March 25, 2025 City Council meeting, the Council voted 4-1 to: 1) introduce ordinances rezoning 1538 El Camino Real into the established S-3 Cannabis Overlay District, and approving a development agreement for the NUG Retail Cannabis Dispensary business; and 2) directed staff to place a resolution approving a Conditional Use Permit and Design Review for the project at the April 8, 2025 Council meeting. Attached are the Rezoning & Development Agreement Ordinances (For 2nd Reading & Adoption) and the Conditional Use Permit & Design Review Resolution.

Alternatives

1. Refer back to staff for additional information.

2. Continue the item for further discussion.

Attachments

1. Rezone Ordinance & Exhibit A

2. Development Agreement Ordinance & Exhibit A

3. Conditional Use Permit and Design Review Resolution & Exhibit A – Conditions of Approval 9

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1538 ECR Staff Memorandum – RZ-DA-CUP-DR
Fiscal Impact
☒ No Fiscal Impact
There is no direct fiscal impact to this action. Future operation of cannabis retail businesses within the City will generate revenue from business and sales taxes, as well as through community benefit contributions.
☐ Funding Source Confirmed:

Source: Purpose: Public Outreach:

Council Council Vision/Priority Other*
*E-Notification of agendas, public notification as required for the April 8, 2025 City Council meeting 10

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ORDINANCE NO. ______

AN ORDINANCE OF THE CITY OF BELMONT REZONING PROPERTY LOCATED AT 1538 EL CAMINO REAL IN THE CITY OF BELMONT INTO THE S-3 CANNABIS

RETAIL AND DISTRIBUTION OVERLAY DISTRICT
WHEREAS, on July 25, 2023, the Belmont City Council provided direction to staff to explore consideration of Land Use Element Amendments to the 2035 General Plan that would potentially allow for commercial cannabis uses in the south El Camino Real area of the City; and, WHEREAS, on November 14, 2023, the Council adopted Resolution 2023-090 amending the Land Use Element of the 2035 General Plan to allow for commercial cannabis land uses in the south El Camino Real area of the City; and,
WHEREAS, 2035 General Plan Land Use Element Section 2.4 as amended declares that allowing commercial cannabis uses in appropriate commercial areas of the City should be considered and identifies the south El Camino Real as an area to be considered, and Policy 2.6-7 and actions 2.6-

7.1 and 2.6-7.2 established implementation goals of adopting a zoning overlay district for the area and establishing licensing regulations for commercial cannabis business; and, WHEREAS, on November 28, 2023, the Council adopted Ordinance 2023-1173 establishing the S-3 Cannabis Retail and Distribution Overlay District for the south El Camino Real area and regulations for the district; and,
WHEREAS, on February 13, 2024, the Council adopted Ordinance 2024-1176 establishing licensing regulations for cannabis businesses; and,
WHEREAS, J&L Belmont Plaza, LCC (“Property Owner)”, is the fee owner of the real property located at 1538 El Camino Real within the City of Belmont, and more particular shown on the Zoning Basemap Section attached hereto as Exhibit A (the “Property”), which is currently zoned Corridor Mixed Use (CMU); and,
WHEREAS, NUG CV BLMT LLC, a California limited liability company (dba NUG) (“Developer”) has a leasehold interest in a portion of the Property and proposes to develop the Property for a cannabis retail use; and,
WHEREAS, the City received an application from Property Owner and Developer to establish a retail cannabis use on Property and seeking approval of an amendment to the Zoning Basemap Designation for the Property incorporating it into the S-3 Cannabis Retail and Distribution Overlay District, as well as Conditional Use Permit, Design Review, and Development Agreement entitlements (the “Project”); and,
WHEREAS, on March 4, 2025, the Planning Commission held a duly noticed public hearing to consider public testimony and a staff report for the request to rezone the Property, and rendered a recommendation as to whether the City Council should rezone the Property as requested; and, WHEREAS, on the March 25, 2025, the Council held a duly noticed public hearing to take testimony from the public and the applicant, to consider the Planning Commission’s recommendation, and to receive a staff report and information about the Project, and at the conclusion of the hearing introduced this ordinance; and, 11

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WHEREAS, on April 8, 2025, the Council at a duly noticed regular meeting the ordinance was presented for adoption by Council in accordance with state law.

WHEREAS, Council previously certified a Final Environmental Impact Report (FEIR) that evaluated the environmental impacts of the City’s 2035 General Plan, Phase I Zoning, Belmont Village Specific Plan (BVSP), and Climate Action Plan (CAP) on October 24, 2017 (the “General Plan EIR” – SCH #2016082075), making required findings under the California Environmental Quality Act (CEQA), adopting a Mitigation Monitoring and Reporting Program (MMRP), and a statement of overriding consideration for that project on November 14, 2017; and, WHEREAS, the City subsequently prepared an addendum examining the environmental effects of amending General Plan Land Use Element Section 2.4 and Policy 2.6-7, and establishing the S-3 Overlay District to allow up to two cannabis retail uses and one cannabis distribution use and found that the project would create no new effects or require new mitigation measures, and having considered the effects peculiar to the proposed Project at the Property, similarly finds the Project would create no new effects or require new mitigation measures.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BELMONT DOES ORDAIN AS FOLLOWS:

SECTION 1. LEGISLATIVE FINDINGS

1. The Council finds the above recitals are true and correct. The Council incorporates as part of its findings herein the findings previously made by Resolution 2023-090 and the findings in the related staff reports previously presented to the Planning Commission and Council.

2. The Council finds that adoption of this ordinance will not result in more than two retail cannabis businesses within the S-3 Overlay District and is consistent with BZO section

21.4.2(b)(2).

3. The Council finds that, as of the date of its adoption, this ordinance will not result in a retail cannabis use being located within 600 feet of a school or other cannabis retail or cannabis distribution use or within 100 feet of parks and actively operated child day care centers, and will not result in the public entrance of a cannabis retail use being located immediately adjacent to a youth-oriented business on the same frontage as the entrance, and is consistent with BZO section

21.4.1(c)(2).

4. Having reviewing all the relevant evidence before the City Council, including the information provided in the staff reports and enclosures to the Planning Commission and City Council and testimony from the public and applicant, the Council finds that the proposed Zoning Basemap (Section) designation amendment incorporating the Property into the S-3 Cannabis Retail and Distribution Overlay District is consistent with General Plan, the Belmont Village Specific Plan and the Zoning Plan.

SECTION 2. ZONING BASEMAP AMENDED

1. The Zoning Map of the City is amended as follows. The property comprising 1538 El Camino Real, as shown on Exhibit A (Zoning Base Map Section), is incorporated into the S-3 Cannabis Retail and Distribution Overlay District and retains its CMU district designation in accordance with Belmont Zoning Ordinance section 21.1.
12

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SECTION 3. EFFECTIVE DATE.

This Ordinance takes effect 30 days after its adoption. * * *
The City Council of the City of Belmont, California introduced the foregoing ordinance on March 25, 2025 and adopted the ordinance at a regular meeting held on _____________by the following vote:

Ayes:

Noes:

Absent:

Abstain:

ATTEST:

City Clerk Mayor
APPROVED AS TO FORM:

City Attorney
13 14

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ORDINANCE NO. ______

AN ORDINANCE OF THE CITY OF BELMONT APPROVING A DEVELOPMENT AGREEMENT FOR A RETAIL CANNABIS PROJECT (NUG) AT 1538 EL CAMINO

REAL IN THE CITY OF BELMONT
WHEREAS, Government Code Sections 65864 et seq. authorize the City of Belmont to enter into agreements for the development of real property with any person having a legal or equitable interest in such property in order to establish certain development rights in such property; and, WHEREAS, the City of Belmont has enacted Section 28 of the Belmont Zoning ordinance to govern the processing of development agreements by the City; and, WHEREAS, J&L Belmont Plaza, LCC (“Property Owner)”, is the fee owner of the real property located at 1538 El Camino Real within the City of Belmont (the “Property”); and, WHEREAS, NUG CV BLMT LLC, a California limited liability company (dba NUG) (“Developer”) has a leasehold interest in a portion of the Property and proposes to develop the Property for a cannabis retail use; and,
WHEREAS, Developer and Property Owner have applied for entitlements to improve the Property and operate a cannabis retail use on the Property, including a rezoning of the property into the S-3 Cannabis Retail and Distribution Overlay District, a Conditional Use Permit and Design Review under Belmont Zoning Ordinance Section 21.4.1(b), and a Development Agreement (the “Project”), and,
WHEREAS, to ensure that the intent of the City, Developer and Property Owner with respect to the approvals for the project entitlements is carried out, the parties desire voluntarily to enter into the Development Agreement, attached hereto and incorporated herein by reference as Exhibit A to Attachment “2”, to facilitate development of the Project subject to the conditions and requirements included in the Development Agreement; and WHEREAS, on March 4, 2025, the Planning Commission held a duly noticed public hearing to consider public testimony and a staff report for the requested development agreement, and rendered a recommendation as to whether the City Council should approve the development agreement; and,
WHEREAS, on the March 25, 2025, the Council held a duly noticed public hearing to take testimony from the public and the applicant, to consider the Planning Commission’s recommendation, and to receive a staff report and information about the Project, and at the conclusion of the hearing introduced this ordinance; and, WHEREAS, on April 8, 2025, the Council at a duly noticed regular meeting at which the ordinance was presented for adoption by Council in accordance with state law; and, WHEREAS, Council previously certified a Final Environmental Impact Report (FEIR) that evaluated the environmental impacts of the City’s 2035 General Plan, Phase I Zoning, Belmont Village Specific Plan (BVSP), and Climate Action Plan (CAP) on October 24, 2017 (the “General Plan EIR” – SCH #2016082075), making required findings under the California Environmental 15

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Quality Act (CEQA), adopting a Mitigation Monitoring and Reporting Program (MMRP), and a statement of overriding consideration for that project on November 14, 2017; and, WHEREAS, the City subsequently prepared an addendum examining the environmental effects of amending General Plan Land Use Element Section 2.4 and Policy 2.6-7, and establishing the S-3 Overlay District to allow up to two cannabis retail uses and one cannabis distribution use and found that the project would create no new effects or require new mitigation measures, and having considered the effects peculiar to the proposed Project at the Property, similarly finds the Project would create no new effects or require new mitigation measures.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BELMONT DOES ORDAIN AS FOLLOWS:

SECTION 1. FINDINGS
Based upon the findings of fact contained in the staff report to the City Council dated March 25, 2025, the presentations to the Council and supporting documents and any public testimony received, and in accordance with Government Code Section 65867.5(b) and Belmont Zoning Ordinance Section 28.8(b), the City Council finds that the provisions of the Development Agreement are consistent with the City's General Plan, and the zoning and other land use regulations applicable to the Property.

SECTION 2. DEVELOPMENT AGREEMENT APPROVAL
The Development Agreement for the Project is approved. The Council authorizes the City Manager to execute the Development Agreement on behalf of the City.

SECTION 3. RECORDATION
No later than 10 days after the Development Agreement is effective and has been executed by all parties, the City Clerk is to record a copy of the Development Agreement with the San Mateo County Recorder, as required by Government Code Section 65868.5.

SECTION 4. EFFECTIVE DATE.

This Ordinance takes effect 30 days after its adoption. * * *
The City Council of the City of Belmont, California introduced the foregoing ordinance, on March 25, 2025 and adopted the ordinance at a regular meeting held on [insert date], 2025 by the following vote:

Ayes:

Noes:

Absent:

Abstain:
16

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ATTEST:

City Clerk
Mayor
APPROVED AS TO FORM:

City Attorney
17 1750\37\3890832.2
Exhibit A to Attachment 2

RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of Belmont
City Clerk's Office
One Twin Pines Lane
Belmont, California 94002
Exempt from Recording Fee
Government Code Section 27383
(Space Above For Recorder's Use)

DEVELOPMENT AGREEMENT
By and Between

THE CITY OF BELMONT
and

NUG CV BLMT LLC
Related to the
Entitlement of a Retail Cannabis Use at 1538 El Camino Real, Suite C 18 TABLE OF CONTENTS
Page
i
1750\37\3890832.2
ARTICLE I DEFINITIONS ......................................................................................................... 2

1.1 Definitions............................................................................................................. 2

1.2 Capitalized Terms. ................................................................................................ 4

1.3 Exhibits. ................................................................................................................ 4 ARTICLE II GENERAL PROVISIONS ...................................................................................... 4

2.1 Parties. ................................................................................................................... 4

2.2 Description of Property. ........................................................................................ 7

2.3 Effective Date. ...................................................................................................... 7

2.4 Execution and Recording. ..................................................................................... 7

2.5 Term. ..................................................................................................................... 7

2.6 Suspension. ........................................................................................................... 7

2.7 Termination. .......................................................................................................... 8

2.8 Force Majeure. ...................................................................................................... 8

2.9 Provisions Required by Statute. ............................................................................ 9 ARTICLE III DEVELOPMENT OF THE PROPERTY .............................................................. 9

3.1 Use of the Property and Applicable Law. ............................................................. 9

3.2 No Conflicting Enactments. ................................................................................ 10

3.3 Fees and Taxes. ................................................................................................... 10

3.4 Timing of Development. ..................................................................................... 11

3.5 Reservations of Authority. .................................................................................. 11

3.6 Subsequently Enacted Rules and Regulations. ................................................... 12

3.7 Initiatives and Referenda. ................................................................................... 12

3.8 Compliance with Requirements of Other Governmental Entities. ..................... 12

3.9 City's Police Power. ............................................................................................ 13

3.10 Subsequent Development Approvals for the Property........................................ 14

3.11 Life of City Approvals and Subsequent Approvals. ........................................... 14

3.12 Developer Obligations and Public Benefits. ....................................................... 14

3.13 Mutual Obligations of the Parties. ...................................................................... 15

ARTICLE IV AMENDMENT, CANCELLATION, AND TERMINATION OF
AGREEMENT .................................................................................................... 16

4.1 Amendment or Cancellation Procedure. ............................................................. 16

4.2 Requirement for a Writing. ................................................................................. 16

4.3 Amendments to Development Agreement Legislation. ...................................... 16

4.4 Amendment of City Approvals. .......................................................................... 16

4.5 Effect of Termination on Developer's Rights and Obligations. .......................... 16 ARTICLE V ANNUAL REVIEW ............................................................................................. 17

5.1 Time of Review................................................................................................... 17

5.2 Required Information from Developer. .............................................................. 17 19 TABLE OF CONTENTS
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5.3 Determination of Good Faith Compliance. ......................................................... 18

5.4 No Waiver. .......................................................................................................... 18

5.5 Reservation of Rights. ......................................................................................... 19 ARTICLE VI DEFAULT, REMEDIES, AND TERMINATION .............................................. 19

6.1 Default................................................................................................................. 19

6.2 Remedies for Default. ......................................................................................... 19

6.3 Notice and Procedure Regarding Defaults. ......................................................... 20

6.4 Mutual Agreement for Cure of Certain Defaults. ............................................... 20

6.5 Alternative Procedure Regarding Defaults; Annual Review. ............................. 20

6.6 Failure to Assert; No Waiver. ............................................................................. 20 ARTICLE VII ESTOPPEL CERTIFICATE .............................................................................. 21 ARTICLE VIII TRANSFERS, ASSIGNMENTS ...................................................................... 21

8.1 Covenants Running with the Land. ..................................................................... 21

8.2 Assignment and Transfer. ................................................................................... 21 ARTICLE IX MORTGAGEE PROTECTION .......................................................................... 22

9.1 Mortgage Protection............................................................................................ 22

9.2 Mortgagee Not Obligated. .................................................................................. 22

9.3 Notice of Default to Mortgagee. ......................................................................... 22

9.4 No Supersedure. .................................................................................................. 22 ARTICLE X INDEMNIFICATION ........................................................................................... 23

10.1 No Duty of City; Hold Harmless. ....................................................................... 23

10.2 Indemnification. .................................................................................................. 23

10.3 Joint and Several Liability. ................................................................................. 23 ARTICLE XI NOTICES............................................................................................................. 23

11.1 Notices. ............................................................................................................... 23 ARTICLE XII MISCELLANEOUS ........................................................................................... 25

12.1 Third-Party Legal Challenge. .............................................................................. 25

12.2 Bankruptcy. ......................................................................................................... 25

12.3 Applicable Law/Venue. ...................................................................................... 25

12.4 Reimbursement of Development Agreement Costs and Fees............................. 25

12.5 Further Assurances.............................................................................................. 26

12.6 Severability. ........................................................................................................ 26

12.7 Nondiscrimination............................................................................................... 26

12.8 Developer Right to Rebuild. ............................................................................... 26

12.9 Headings. ............................................................................................................ 26 20 TABLE OF CONTENTS
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12.10 Agreement is Entire Understanding. ................................................................... 26

12.11 Interpretation. ...................................................................................................... 27

12.12 Recordation of Termination. ............................................................................... 27

12.13 Signature Pages; Execution in Counterparts. ...................................................... 27 21 1750\37\3890832.2

DEVELOPMENT AGREEMENT
THIS DEVELOPMENT AGREEMENT (the "Agreement") is made and entered into on the _____ day of __________, 2025, by and between the CITY OF BELMONT, a municipal corporation ("City"), and NUG CV BLMT LLC, a California limited liability company ("Developer") and J & L Belmont Plaza, LLC, a California limited liability company (the "Property Owner"), under the authority of Sections 65864 – 65869.5 of the California Government Code and Section 28 of the Belmont Zoning Ordinance. The City, Developer, and Property Owner are, from time to time, individually referred to in this Agreement as a "Party" and collectively referred to as the "Parties."

RECITALS
A. To strengthen the public planning process, encourage private participation in comprehensive planning, and reduce the economic risk of development, the Legislature of the State of California adopted Government Code Sections 65864 – 65869.5 (the "Development Agreement Statute"), which authorizes the City and any person having a legal or equitable interest in real property to enter into a development agreement and, among other things, establish certain development rights in property which is the subject of a development project application. The City Council of the City of Belmont (the "City Council") adopted Section 28 of the Belmont Zoning Ordinance to govern the processing of development agreements by the City.

B. The operation of commercial cannabis activities is a highly regulated business activity and is subject to various state and local laws and regulations. On November 28, 2023, the City adopted a resolution amending the Land Use Element of the 2035 General Plan that would allow for commercial cannabis land uses and establishment of an overlay zone allowing for potential cannabis retail and distribution businesses.

C. Government Code Section 65865 requires than an applicant for a development agreement hold a legal or equitable interest in the real property that is the subject of the development agreement.

D. Developer affirms that it has a leasehold interest in that certain property located within the City of Belmont, County of San Mateo, State of California, as further described in Exhibit A attached hereto and incorporated herein by reference (the "Property") pursuant to a lease with the Property Owner for the purpose of carrying out this Project.

E. Developer is a Cannabis Business and has applied for entitlements and permits to operate a Cannabis Retail establishment, as may be modified in the City Approvals defined in Recital F below (the "Project").

F. The following approvals, entitlements, and findings were adopted by the City with respect to the Project after duly and properly noticed public hearings:
i. On April 8, 2025, the Council found the Project consistent with the certified Final Environmental Impact Report (FEIR) that evaluated the environmental impacts of the City’s 2035 General Plan, Phase I Zoning, Belmont Village Specific Plan (BVSP), and Climate Action 22 -2-
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Plan (CAP) on October 24, 2017 (the “General Plan EIR” – SCH #2016082075) under the California Environmental Quality Act (CEQA), found the Project would create no new effects or require new mitigation measures, and that no further environmental document was needed. ii. On April 8, 2025, the City Council adopted Ordinance No. _______, rezoning the Property to the S-3 Overlay District.
iii. On April 8, 2025, the City Council adopted Resolution No. _________ approving the Conditional Use Permit for the Cannabis Retail use. iv. On April 8, 2025, the City Council adopted Ordinance No. ______ approving this Development Agreement as more fully set forth below.

The City actions identified above are collectively the "City Approvals." G. The development of the Project may require future discretionary approvals and will require ministerial approvals from the City, potentially including, but not limited to, encroachment permits, demolition permits, grading permits, building permits, and certificates of occupancy ("Subsequent Approvals").

H. To ensure that the intent of the City and Developer with respect to the City Approvals is carried out, the Parties desire voluntarily to enter into this Agreement to facilitate development of the Project subject to the conditions and requirements included in this Agreement.

I. The Planning Commission reviewed this Agreement at a public hearing held on March 4, 2025 but did not recommend approval to the City Council.

J. The City Council reviewed this Agreement at a public hearing held on March 25, 2025 and found that the provisions of this Agreement are consistent with the City's general plan and any applicable specific plan and are consistent with the zoning and other land use regulations applicable to the property, as well as the Development Agreement Statute, and, therefore, approved this Agreement by Ordinance No. ______________, introduced on March 25, 2025 and adopted on April 8, 2025 (the "Adoption Date"). Ordinance No. __________ (the "Enacting Ordinance") will become effective on May 8, 2025 (the "Effective Date").

NOW, THEREFORE, with reference to the foregoing Recitals and in consideration of the mutual promises, obligations and covenants herein contained, City and Developer agree as follows:

AGREEMENT
The introductory paragraph, the Recitals, and all defined terms set forth therein are hereby incorporated into this Agreement as if hereinafter fully and completely rewritten.

ARTICLE I

DEFINITIONS

1.1 Definitions.
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The following defined terms are used in this Agreement:

1.1.1 "Adoption Date" is defined in Recital J.

1.1.2 "Agreement" is defined in the first paragraph, page 1.

1.1.3 "Annual Review Form" is defined in Section 5.2.

1.1.4 "Applicable Law" is defined in Section 3.1.4.

1.1.5 "Assignment" is defined in Section 8.2.

1.1.6 "Cannabis Business" means any business operating a cannabis retail or a cannabis distribution use, either as the sole use or in combination with other uses, on or from property located within the City of Belmont and includes not-for-profit retail and distribution use.

1.1.7 "Cannabis Retail" means a use involving the retail sale of cannabis or cannabis products to customers at fixed located locations or by delivery.

1.1.8 "CEQA" is defined in Recital F.

1.1.9 "City" is defined in the first paragraph, page 1 and in Section 2.1.1.

1.1.10 "City Approvals" is defined in Recital F.

1.1.11 "City Council" is defined in Recital A.

1.1.12 "City Law" is defined in Section 3.2.

1.1.13 "Complaining Party" is defined in Section 6.3.

1.1.14 "Declaration of Default" is defined in Section 6.3.

1.1.15 "Default" is defined in Section 6.1.

1.1.16 "Defaulting Party" is defined in Section 6.3.

1.1.17 "Development Agreement Statute" is defined in Recital A.

1.1.18 "Developer" is defined in the first paragraph, page 1 and in Section 2.1.2.

1.1.19 "Effective Date" is defined in Recital J and in Section 2.3.

1.1.20 "Enacting Ordinance" is defined in Recital J.

1.1.21 "Impact Fees" are defined in Section 3.3.1.

1.1.22 "Notice of Default" is defined in Section 6.3.
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1.1.23 "Party" and "Parties" are defined in the first paragraph, page 1.

1.1.24 "Project" is defined in Recital F.

1.1.25 "Property" is defined in Recital D.

1.1.26 "Property Owner" is defined in the first paragraph, page 1.

1.1.27 "Subsequent Approvals" is defined in Recital G.

1.1.28 "Term" is defined in Section 2.5.

1.1.29 "Third Party Challenge" is defined in Section 12.1.

1.1.30 "Vesting Statutes" is defined in Section 3.12.3.

1.2 Capitalized Terms.

If any capitalized terms contained in this Agreement are not defined above, then any such terms shall have the meaning otherwise ascribed to them in this Agreement.

1.3 Exhibits.

The following Exhibits are attached hereto and incorporated into this Agreement:

Exhibit A: Legal Description
Exhibit B: Annual Review Form

ARTICLE II

GENERAL PROVISIONS

2.1 Parties.

2.1.1 The City.
(a) The City is a municipal corporation duly organized and validly existing under the laws of the State of California. The office of the City is located at One Twin Pines Lane, Belmont, California 94002. "City," as used in this Agreement, includes the City of Belmont and any assignee or successor to its rights, powers and responsibilities. (b) The City represents and warrants that, as of the Effective Date of this Agreement:
(i) The execution and delivery of this Agreement and the performance of the obligations of City have been duly authorized by all necessary actions and approvals required for a municipal corporation;
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(ii) The City is in good standing and has all necessary powers under the laws of the State of California and in all other respects to enter into and perform the undertakings and obligations of this Agreement; and
(iii) This Agreement is a valid obligation of City enforceable in accordance with its terms.

2.1.2 The Developer.
(a) Developer is NUG CV BLMT, LLC, a California limited liability company. For the purposes of this Agreement the Developer's office is located at 2301 Blanding Avenue, Suite 408, Alameda, California 94501.
(b) Developer represents and warrants that, as of the Effective Date of this Agreement, Developer:
(i) Has entered into a lease agreement with Property Owner of the Property;
(ii) Is duly organized and validly existing under the laws of the State of California;
(iii) Is qualified and authorized to do business in the State of California and has duly complied with all requirements pertaining thereto; and (iv) Is in good standing and has all necessary powers under the laws of the State of California to lease property and in all other respects enter into and perform the undertakings and obligations of this Agreement.
(c) Developer further represents and warrants:
(i) That no approvals or consents of any persons are necessary for the execution, delivery or performance of this Agreement by Developer, except as have been obtained;
(ii) That the execution and delivery of this Agreement and the performance of the obligations of Developer have been duly authorized by all necessary actions and approvals required under any partnership or other agreement for the limited partnership constituting Developer;
(iii) That this Agreement is a legal, valid, and binding obligation of Developer enforceable in accordance with its terms;
(iv) That the execution, delivery, and performance of this Agreement by the Developer does not and will not materially conflict with, or constitute a material violation or material breach of, or constitute a default under (a) the partnership agreements of the Developer, (b) any law, rule, or regulation binding upon or applicable to the Developer, or (c) any material agreements to which Developer is a party;
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(v) That, unless otherwise disclosed in writing to the City prior to the date of Council adoption of this Agreement and except for threats of litigation expressed in public hearings relating to the City Approvals, to the Developer's actual knowledge, there is no existing or pending or threatened litigation, suit, action, or proceeding before any court or administrative agency affecting the Developer or the Property that would, if adversely determined, materially and adversely affect the Developer's ability to perform its obligations under this Agreement or to develop and operate the Project; and
(vi) That Developer or any person or entity owning or operating the Property, has duly obtained and maintained, or will duly obtain and maintain, all licenses, permits, consents, and approvals required by all applicable governmental authorities to develop, sell, lease, own, and operate the Project on the Property.

2.1.3 The Property Owner.
(a) Property Owner is J & L Belmont Plaza LLC, a California limited liability company. For the purposes of this Agreement the Property Owner's office is located at 843 Malcolm Road, Burlingame, California 94010.
(b) Property Owner represents and warrants that, as of the Effective Date of this Agreement, Property Owner:
(i) Is the legal owner of the Property;
(ii) Has entered into a lease agreement with Developer; (iii) Consents to the terms of this Agreement;
(iv) Consents to the recordation of this Agreement against the title of the Property.

2.1.4 Relationship of City and Developer.

The Parties specifically acknowledge that this Agreement is a contract that has been negotiated and voluntarily entered into by the Parties and that the Developer is an independent contracting entity and not an agent or partner of City. The Parties further acknowledge that no Party is acting as the agent of the other in any respect hereunder and that each Party is an independent contracting entity with respect to the terms, covenants, and conditions contained in this Agreement.

None of the terms or provisions of this Agreement shall be deemed to create a partnership between or among the Parties in the business of Developer or Property Owner, the affairs of the City, or otherwise. The Parties hereby renounce the existence of any form of joint venture or partnership between them, and agree that nothing contained in this Agreement or in any document executed in connection with this Agreement shall be construed as making City, Property Owner, or Developer joint venturers or partners.
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This Agreement does not require the Developer or Developer's contractors to pay prevailing wages if the Project is not a "public work" apart from any potentially applicable State Labor Code requirements and implementing regulations of the Department of Industrial Relations pertaining to "public works" (collectively, "Prevailing Wage Laws"). The Parties agree and acknowledge that the City makes no representation as to the applicability of Prevailing Wage Laws to the Project, and it is the Developer's sole responsibility to determine which, if any, Prevailing Wage Laws apply.

2.2 Description of Property.

The Property which is the subject of this Agreement is described in Exhibit A attached hereto.

2.3 Effective Date.

This Agreement shall become effective upon the effective date of the Enacting Ordinance approving this Agreement (the "Effective Date"), as set forth in Recital J of this Agreement.

2.4 Execution and Recording.

The Developer and Property Owner have executed and acknowledged this Agreement. Not later than ten (10) days after the Adoption Date, the City shall execute and acknowledge this Agreement. Not later than ten (10) days after the Effective Date, the City Clerk shall cause recordation of this Agreement with the San Mateo County Recorder against the Property, provided that a referendum applicable to the Enacting Ordinance has not been timely submitted to the City.

2.5 Term.

The term of this Agreement shall commence upon the Effective Date and continue for a period of ten (10) years from the Effective Date (the "Term"), unless the Term is terminated, modified, or extended by the terms of this Agreement. Upon City's sole discretion, the Term may be extended for an additional ten (10) year term and so long as the Project is in compliance with all applicable conditions of approval and City Law.

2.6 Suspension.

The Developer must cease all Cannabis Business operations, upon notification by the City of the occurrence of any of the following events ("Suspension Events"):

2.6.1 the Developer is in Default and has not cured such Default in accordance with Sections 6.2 and 6.3 of this Agreement;

2.6.2 the Developer operates the Cannabis Business in a continued and unremedied manner that endangers public health and safety, including but not limited to (i) failing to prevent conduct of patrons in and around the immediate vicinity of the Property that is disruptive, creates excessive noise, constitutes a nuisance, or is unlawful, (ii) failing to deter crimes against patrons on the Property or in the immediate vicinity of the Property, or (iii) failing to 28 -8-
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operate the business in strict accordance with all state and local permits and regulatory requirements;

2.6.3 any permit or license necessary to operate a Cannabis Business is suspended.

The City will provide written notification to Developer of a Suspension Event and the reason for such suspension. Within ten (10) business days of City providing such notice Developer may request the suspension be lifted and Developer's reason for lifting the suspension. Upon receipt of such request from Developer, City will schedule a public hearing before the City Council at the earliest available City Council meeting, but not later than sixty (60) days from the date of the request. The City Council shall consider the suspension and may either (i) end the suspension, (ii) end the suspension upon certain conditions being fulfilled, or (iii) terminate this Agreement. If Developer has not requested the suspension be lifted within ten (10) business days, the City may elect to terminate this Agreement.

2.7 Termination.

This Agreement shall terminate upon the occurrence of any of the following events:

2.7.1 the expiration of the Term;

2.7.2 the Developer no longer has a possessory, legal or other equitable interest in the Property;

2.7.3 the Developer has ceased all operations related to the Project on the Property for a period of thirty (30) consecutive days;

2.7.4 Federal enforcement of the Federal Controlled Substances Act against Developer, Property Owner, or City;

2.7.5 any permit or license necessary to operate a Cannabis Business is terminated.

Upon termination of this Agreement, either by expiration of otherwise, Developer shall have no right to engage in any Cannabis Business on the Property, except as the City Council may affirmatively allow by appropriate subsequent action.

2.8 Force Majeure.

2.8.1 Performance by either City or Developer shall not be deemed to be in Default, and the Term shall be extended, where delays are due to: (a) natural disasters that are not caused by, are outside the reasonable control of, and at the time of entering into this Agreement are not known to and cannot be anticipated by the Developer, including without limitation floods, earthquakes, and fires; (b) a fire or flood during construction after issuance of a building permit, 29 -9-
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whether or not the result of a natural disaster, a third party, or negligence by Developer or Developer's employee, agent or contractor (but not intentional acts or gross misconduct of the Developer); and (c) third-party litigation challenging this Agreement, the City Approvals, or the Subsequent Approvals, which delays any activity contemplated herein.

2.8.2 An extension of time for any such cause shall be for the period of the enforced delay, shall commence to run from the time of commencement of the cause, and will be deemed granted if notice by the Party claiming such extension and demonstrating that the delay is caused by an event of Force Majeure, is sent to the other within ten (10) days from the commencement of the cause and such extension of time is not rejected in writing by the other Party within ten (10) days of receipt of the notice. In the event the other Party rejects such notice, the Parties shall meet and confer in good faith for a period of at least 30 calendar days. In no event shall the cumulative period of enforced delay under this Section 2.6 exceed one (1) year.

Notwithstanding this Section 2.6, the limitation on Impact Fees provided in Section 3.3 below may not be extended due to enforced delay.

2.9 Provisions Required by Statute.

The Development Agreement Statute provides, among other things, that a development agreement shall specify the following:

2.9.1 Duration of the Agreement. See Sections 2.5 and 2.6 of this Agreement.

2.9.2 Permitted Uses of the Property. See Section 3.1.2 of this Agreement.

2.9.3 Density or Intensity of Uses. See Section 3.1.2 of this Agreement and the City Approvals.

2.9.4 Maximum Height and Size of Proposed Buildings. See Section 3.1.2 of this Agreement and the City Approvals.

2.9.5 Reservation or Dedication of Land for Public Purposes. See Section 3.1.2 of this Agreement and the City Approvals.

2.9.6 Periodic Review at Least Annually. See Article V of this Agreement.

ARTICLE III

DEVELOPMENT OF THE PROPERTY

3.1 Use of the Property and Applicable Law.

3.1.1 Subject to Agreement.

The Property is hereby made subject to the provisions of this Agreement. All development of, or on, the Property, or any portion thereof, shall be undertaken only in compliance with the provisions of this Agreement and with Applicable Law. Developer shall additionally be required to obtain all state required licenses required for the operation of a Cannabis Business. 30 -10-
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3.1.2 Permitted Uses.

The permitted uses of the Property, the density or intensity of use, the maximum height and size of proposed buildings, and provisions for reservation or dedication of land for public purposes shall be governed by Applicable Law.

3.1.3 Laws Governing Cannabis Activities.

The operation of a Cannabis Business is a highly regulated business activity and is subject to various state and local laws and regulations. This Agreement does not, and the City cannot and does not intent to, give Developer the right to continue its operations without complying with applicable state and local laws governing its operations. Developer shall be responsible for obtaining all applicable state permits, approvals and consents, even if the applicable state laws and regulations are altered following the Effective Date.

3.1.4 Applicable Law.
"Applicable Law" includes the City Approvals, this Agreement, the Subsequent Approvals when approved by the City, and those City ordinances, resolutions, rules, regulations, standards, policies, conditions, and specifications applicable to the Property in effect on the Effective Date, except as otherwise provided in Sections 3.3, 3.5, 3.6, 3.8, and 3.12.

3.2 No Conflicting Enactments.

Except as and to the extent required by state or federal law, and subject to the provisions of this Agreement and Sections 3.3, 3.5, 3.6, 3.8, and 3.12 below, the City shall not impose on the Property any plan, ordinance, resolution, rule, regulation, standard, policy, condition, or specification, including by initiative (each individually, a "City Law"), that has any of the following effects on the rights provided by Applicable Law:

3.2.1 Changes any land use designation or permitted use of the Property from that shown in Applicable Law;

3.2.2 Limits or controls the rate, timing, phasing or sequencing of the approval, development, or construction of all or any part of the Property except as set forth in Applicable Law; or

3.2.3 Limits or restricts any right specifically granted by the City Approvals, including but not limited to permitted uses and density and intensity of use and maximum height and size of buildings; or

3.2.4 Imposes any requirements for reservation or dedication of land for public purposes except as set forth in Applicable Law.

3.3 Fees and Taxes.
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3.3.1 Impact Fees. Developer shall pay if and when due all Impact Fees imposed by the City which are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for. "Impact Fees" are the monetary amount charged by City in connection with a development project for the purpose of defraying all or a portion of the cost of mitigating the impacts of the development project or development of the public facilities related to the development project, including any "fee" as that term is defined by Government Code Section 66000(b). No Impact Fees will be assessed for the entitlements that are being granted under this Development Agreement.

3.3.2 Business License Tax. Developer shall pay to the City when due the business license tax, in accordance with the provisions of City of Belmont City Code Chapter 23, Article 6. Any failure to pay such business license tax shall be considered a default of this Agreement.

3.4 Timing of Development.

Developer has no obligation to develop or to construct the Project. The timing, sequencing, and phasing of the Project is solely the responsibility of Developer in the exercise of its business judgment so long as it is consistent with Applicable Law. In particular, the Parties desire to avoid the result of Pardee Construction Co. v. City of Camarillo (1984) 37 Cal.3d 465, where the failure of the parties therein to consider and expressly provide for the timing of the development resulted in a later adopted initiative restricting the timing of development to prevail over such parties' agreement. The Parties therefore acknowledge that Developer shall have the right to develop the Project at such time as Developer deems appropriate in the exercise of its business judgment so long as such development is consistent with Applicable Law.

3.5 Reservations of Authority.

Notwithstanding any other provision of this Agreement, and notwithstanding the provisions of Section 3.2, at the time Subsequent Approvals are applied for, the following regulations and provisions shall apply to those Subsequent Approvals as they are in effect at the time of those Subsequent Approvals:

3.5.1 Processing fees and processing charges of every kind and nature imposed by the City, including application, inspection, and monitoring fees, which are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for.

3.5.2 All taxes, assessments, and use charges imposed by the City which are in force and effect within the jurisdiction of the City for a broadly based class of taxpayers, land, or Subsequent Approvals, as applicable, on which they are imposed.

3.5.3 Procedural regulations relating to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals and any other matter of procedure, which are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for.
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3.5.4 Regulations governing construction standards and specifications including, without limitation, the California Building Standards Codes and local amendments thereto, city grading regulations, and all other uniform construction codes which are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for.

3.6 Subsequently Enacted Rules and Regulations.

The City may, during the term of this Agreement, apply such newer City Laws that are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for and which are not in conflict with the terms of this Agreement. The City may also modify the Applicable Law to address a specific, adverse impact upon public health or safety that cannot reasonably be addressed by other means. Nothing in this Agreement limits the City’s authority to apply and enforce the regulations in Belmont City Code Chapter 13 applicable to cannabis businesses to a cannabis business operating or seeking to operate on the Property or to apply and enforce such newer cannabis business regulations as may be adopted from time to time.

3.7 Initiatives and Referenda.

3.7.1 If, during the Term of this Agreement, any City Law is enacted or imposed by a citizen-sponsored initiative or referendum, or by the City Council directly or indirectly in connection with any proposed initiative or referendum, which City Law would conflict with this Agreement, such City Law shall not apply to the Property. The Parties, however, acknowledge that the City's approval of this Agreement is a legislative action subject to referendum.

3.7.2 Without limiting the generality of any of the foregoing, no moratorium imposed by the City affecting subdivision maps, building permits, or other Subsequent Approvals shall apply to the Property during the Term of this Agreement. Developer agrees and understands that the City does not have authority or jurisdiction over another public agency's authority to grant a moratorium.

3.7.3 The timing, sequencing, and phasing of development within the Project shall be consistent with those timing, sequencing and phasing provisions specified in this Agreement, the City Approvals, and Applicable Law.

3.7.4 The City shall cooperate with Developer and shall undertake such actions as may be necessary to ensure this Agreement remains in full force and effect and that no conflicting enactments are imposed on the Property, except as otherwise authorized by this Agreement.

3.8 Compliance with Requirements of Other Governmental Entities.

Developer shall pay all required fees when due to federal, state, regional, or other local governmental agencies other than the City and acknowledges that City does not control the amount of any such fees.
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3.8.2 City shall cooperate with Developer in Developer's effort to obtain permits and approvals from federal, state, regional, and other local governmental agencies, provided that same does not impose any costs on or require the City to incur any costs without compensation or reimbursement, or require the City to amend any of the City's policies, regulations, or ordinances.

3.8.3 As provided in California Government Code Section 65869.5, this Agreement shall not preclude the application to the Property of changes in state or federal laws, regulations, plans, or policies, and the City may enforce changes in local laws, regulations, plans or policies that are specifically mandated by changes in state or federal laws, regulations, plans or policies or required to prevent the City from incurring liabilities or other costs resulting from such changes. In the event changes in the state or federal laws prevent or preclude compliance with one or more provisions of this Agreement, this Agreement shall be modified as may be necessary to comply with such state or federal laws or regulations. The Parties shall meet and confer in good faith in order to determine whether such provisions of this Agreement shall be modified as may be necessary to comply with changes in the law, and City and Developer shall agree to such action as may be reasonably required. It is the intent of the Parties that any such modification be limited to that which is necessary and to preserve to the extent possible the original intent of the Parties in entering into this Agreement. This Agreement shall remain in full force and effect to the extent it is not inconsistent with such laws or regulations. Nothing in this Agreement shall preclude the City or Developer from contesting by any available means (including administrative or judicial proceedings) the applicability to the Property of any such state or federal laws or regulations.

3.8.4 To the extent that any actions of federal or state agencies (or actions of other governmental agencies, including City, required by federal or state agencies, or actions of City taken in good faith to the extent necessary to prevent the City from incurring liability as a result of failure to comply with actions of federal, state or other governmental agencies) have the effect of preventing, delaying, or modifying development or the use of the Property or any portion thereof, City shall not in any manner be liable for any such prevention, delay, or modification.

Such actions include, but are not limited to, state and federal cannabis regulations and actions of the City or other governmental agencies as a result; flood plain or wetlands or endangered species designations and actions of City or other governmental agencies as a result; the imposition of air quality or transportation measures or sanctions and actions of City or other governmental agencies as a result; or changes to CEQA and actions of City or other governmental agencies as a result.

As a condition to being able to proceed with development, Developer may be required, at its cost, to participate in such regional or local programs and to be subject to such development restrictions as may be necessary or appropriate by reason of actions of federal, state or other governmental agencies (or action of City taken in order to prevent adverse impacts upon City by actions of federal, state, or other governmental agencies).

3.9 City's Police Power.

The Parties acknowledge this Agreement constitutes a lawful limitation on the City's police power. The Parties further acknowledge and agree that the limitations, reservations, and exceptions contained in this Agreement are intended to reserve to the City that part of its police power which are not otherwise addressed in this Agreement, and this Agreement shall be construed to reserve to the City those parts of its police powers which cannot be restricted by contract. Subject 34 -14-
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to the limitations specified in this Agreement, the City intends that rules, regulations, official policies, standards and specifications of City applicable to the development of the Project shall be the Applicable Law.

3.10 Subsequent Development Approvals for the Property.

3.10.1 Applications for Subsequent Approvals are anticipated to be submitted to the City by the Developer. Applications for Subsequent Approvals shall be processed diligently in good faith by the City and considered in a manner consistent with the rights granted by this Agreement and Applicable Law.

3.10.2 Nothing herein shall limit the ability of the City to require the necessary reports, analyses, or studies to assist in determining whether the requested Subsequent Approval is consistent with Applicable Law and this Agreement. City's review of the Subsequent Approvals shall be consistent with this Agreement, including without limitation Section 3.2 of this Agreement. To the extent that is consistent with CEQA, as determined by the City in its reasonable discretion, City shall utilize the Environmental Impact Report as described in Recital F to review the environmental effects of the Subsequent Approvals.

3.10.3 Notwithstanding the above, as required by Government Code Section 65867.5, any and all tentative maps prepared for a subdivision of the Property shall comply with the provisions of Government Code Section 66473.7, if applicable.

3.11 Life of City Approvals and Subsequent Approvals.

If any City Approval or Subsequent Approval shall expire during the Term of this Agreement, Developer shall retain all vested rights contained in this Agreement and shall be entitled to re-approval of the City Approval or Subsequent Approval consistent with Applicable Law for the Term of this Agreement.

3.12 Developer Obligations and Public Benefits.

As a material consideration for the long term assurances, vested rights, and other City obligations provided by this Agreement and as a material inducement to City to enter into this Agreement, Developer has offered and agreed to provide the public benefits to the City listed in this Section 3.12 and has further agreed to comply with all of its obligations under this Agreement, including in particular the obligations set forth in this Section 3.12.

3.12.1 Compliance with Agreement and Applicable Law. In addition to any other obligations of Developer set forth herein, in consideration of City entering into this Agreement, Developer has agreed that if Developer commences development of the Property and proceeds to develop the Property, such development shall be in conformance with all of the terms, covenants, and requirements of this Agreement and Applicable Law, and Developer shall perform those specific obligations and provide those specific contributions identified in the conditions of approval and exhibits to the City Approvals. Developer shall pay when due all fees and costs which are imposed on all or any portion of the Property, whether imposed by City or other agencies, as provided in this Article III.
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3.12.2 Public Benefits. In addition to the other benefits identified in Section 3.12, the Project will provide public benefits as follows:
(a) A donation of Fifty Thousand Dollars ($50,000) to the City to be applied to the purchase of a mobile recreation vehicle for use by the Parks and Recreation Department. This payment shall be made by Developer within ninety days upon issuance of certificate of occupancy for the Project.
(b) An annual public benefit contribution of one and a half percent (1.5%) of gross receipts from operations of the Cannabis Business up to the first twelve million dollars ($12,000,000) of gross receipts and two (2%) percent of any gross receipts above that amount, to be contributed at the time of the business license tax payment (no later than February 28 of each year), distributed as follows:
(i) Fifty percent (50%) to Belmont Community Foundation.

3.12.3 Waiver of Vesting Statutes. As a material consideration for the long term assurances, vested rights, and other City obligations provided by this Agreement and as a material inducement to City to enter into this Agreement, Developer further agrees that, as long as this Agreement is in effect, the provisions of this Agreement shall govern and control the City Law to be applied to this development of the Property over any contrary or inconsistent provisions of Section 66498.1 et seq. of the Government Code or any other statute which purports to provide vested rights ("Vesting Statutes"). Developer waives the benefits of any Vesting Statute as it may be inconsistent or contrary to the provisions of this Agreement, including but not limited to vesting of development fees of all types. Notwithstanding anything to the contrary in this Section, the Parties acknowledge and agree that this Agreement vests Developer's rights to develop the Project in accordance with the terms of this Agreement and the provisions of state and local law concerning development agreements.

3.13 Mutual Obligations of the Parties.

City has agreed to provide Developer with the long term assurances, vested rights, and other City obligations described in this Agreement, including in particular those obligations described in this Article III, in consideration for the Developer obligations contained in this Agreement, including in particular those Developer obligations described in this Article III.

Developer has agreed to provide City with the Developer obligations contained in this Agreement, including in particular those Developer obligations described in this Article III, in consideration for the City obligations described in this Agreement, including in particular those obligations described in this Article III. To ensure that the understanding of the Parties and mutual consideration remain effective, should either Party bring any administrative, legal, or equitable action or other proceeding to set aside or otherwise make ineffective any of the City or Developer 36 -16-
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obligations described in this Agreement, this Agreement may be terminated by the Party against whom the proceeding is brought at that Party's sole discretion.

ARTICLE IV

AMENDMENT, CANCELLATION, AND TERMINATION OF AGREEMENT

4.1 Amendment or Cancellation Procedure.

The Parties may mutually agree to amend or cancel this Agreement in whole or in part. As required by Belmont Zoning Ordinance Section 28.10, any amendment to or cancellation of this Agreement may be made only if the City follows the same procedures prescribed by Government Code 65864 et seq. and those procedures prescribed in Section 28 of the Belmont Zoning Ordinance (Ordinance No. 360 as amended) for entering into a new development agreement, including but not limited to public hearings before the Belmont Planning Commission and City Council and adoption of the amendment or cancellation by ordinance.

4.2 Requirement for a Writing.

No amendment to or cancellation of this Agreement or any provision of this Agreement shall be effective for any purpose unless adopted in accordance with the procedures prescribed in Belmont Zoning Ordinance Section 28 and specifically set forth in a writing that refers expressly to this Agreement and is signed by duly authorized representatives of the Parties. The City Clerk shall record an appropriate notice of any amendment or cancellation with the San Mateo County Recorder not later than ten (10) days after the effective date of the action effecting such amendment or cancellation, accompanied by a legal description of the Property.

4.3 Amendments to Development Agreement Legislation.

This Agreement has been entered into in reliance upon the provisions of the Development Agreement Statute, as those provisions existed at the date of execution of this Agreement. No amendment or addition to the Development Agreement Statute which would materially affect the interpretation or enforceability of this Agreement shall be applicable to this Agreement unless such amendment or addition is specifically required by the California State Legislature, or is mandated by a court of competent jurisdiction. If such amendment or change is permissive (as opposed to mandatory), this Agreement shall not be affected unless the Parties mutually agree in writing, after following the procedures in Section 4.1, to amend this Agreement to permit such applicability.

4.4 Amendment of City Approvals.

To the extent permitted by local, state, and federal law, any City Approval may, from time to time, be amended or modified by submittal of an application from the Developer and following the procedures for such amendment or modification contained in the Belmont City Code and Belmont Zoning Ordinance as applicable. Upon any approval of such an amendment or modification, the amendment or modification to the City Approval shall automatically be deemed to be incorporated into the Applicable Law without any further requirement to amend this Agreement.

4.5 Effect of Termination on Developer's Rights and Obligations. 37 -17-
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4.5.1 Notwithstanding any other provision to the contrary, should the Developer or its successor seek to develop the Project, termination or cancellation of this Agreement or termination of the rights of Developer as to the entire Property, or any part the Property, shall not affect any requirement to comply with the City Approvals, the terms and conditions of any other Subsequent Approval, nor any payments then due and owing to City, nor shall it affect the covenants of Developer specified in Section 4.5.2 below to continue after the termination or cancellation of this Agreement. Developer understands and agrees that the City Approvals may be substantially modified in light of the circumstances resulting from the termination or cancellation of this Agreement or Developer's rights under this Agreement, and Developer shall have no rights to challenge such a modification by reason of this Agreement other than the rights, if any, Developer would have in the absence of this Agreement.

4.5.2 Notwithstanding anything in this Agreement to the contrary, the following provisions of this Agreement shall survive and remain in effect following termination or cancellation of this Agreement for so long as necessary to give them full force and effect with respect to claims or rights of City arising prior to termination or cancellation:
(a) Section 3.12 (Developer Obligations), to the extent such obligations have not been met upon termination or cancellation;
(b) Section 4.5.1 (Developer's obligations upon termination or cancellation);
(c) Section 6.2 (Remedies; limitation on damages and exceptions thereto; accrued obligations);
(d) Section 10.2 (Indemnification);
(e) Section 10.3 (Joint and Several Liability); and
(f) Section 12.1.1 (Indemnification – Third Party Challenge).

ARTICLE V

ANNUAL REVIEW

To determine Developer's good faith compliance with this Agreement, and in compliance with Belmont Zoning Ordinance Section 28.12, the City shall review this Agreement and all actions taken with respect to the development of the Property at least every twelve months from the Effective Date, commencing on the first anniversary of the Effective Date. The date for the annual review may be modified by agreement between the Parties, so long as the review occurs at least every twelve months, or the City may elect to initiate a review at any time.

5.2 Required Information from Developer.
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It is the Developer's responsibility to apply in a timely fashion for the annual review by submitting a written request to the Community Development Director, including a completed Annual Review Form in the form provided in Exhibit B (the "Annual Review Form") no more than sixty (60) and no less than thirty (30) days prior to the review date. The burden of proof, by substantial evidence, of good faith compliance shall be upon Developer. Developer shall provide the evidence determined necessary by the Community Development Director to demonstrate good faith compliance with the provisions of this Agreement. Developer shall provide detailed evidence of Developer's compliance with the each obligation under this Agreement, including but not limited to the provisions of Section 3.12, and other information reasonably requested by the Community Development Director to determine compliance. The Community Development Director may conduct the annual review notwithstanding Developer's failure to submit the written request. Failure to submit the written request or to list or describe compliance with an obligation is substantial evidence that the Developer has not complied in good faith with the obligation and the provisions of this Agreement. Costs reasonably incurred by the City in connection with the annual review and any related hearings shall be paid by Developer in accordance with the City's schedule of fees in effect at the time of review.

5.3 Determination of Good Faith Compliance.

If the Community Development Director determines in writing that, based upon substantial evidence, Developer has complied in good faith with the terms and conditions of this Agreement, the annual review shall be concluded. If the Developer fails to submit a timely periodic review application or the Community Development Director finds that, based upon substantial evidence, Developer has not complied in good faith with the terms and conditions of this Agreement, the Community Development Director shall prepare a written notice describing the failure to comply and notify the Developer as required by Section 11.1 and any other person who has requested notice concerning this Agreement. If Developer fails to demonstrate compliance to the Community Development Director's satisfaction within 30 days from the date of the notice, the Community Development Director shall forward the matter to the City Council with his or her recommendation.

If the City Council determines, based upon substantial evidence that Developer has complied in good faith with the terms and conditions of this Agreement, the annual review shall be concluded. If, however, the City Council determines, based upon substantial evidence, that Developer has not complied in good faith with the terms and conditions of this Agreement, the City Council may terminate or modify this Agreement as authorized by Government Code Section 65865.1 after complying with the provisions of this Agreement and the notice and hearing procedures contained in Belmont Zoning Ordinance Section 28 or successor provision.

5.4 No Waiver.

Failure of City to timely conduct an annual review shall not constitute a waiver by City of its right to do so at a later date nor a waiver of its rights to otherwise enforce the provisions of this Agreement, nor shall Developer have or assert any defense to such enforcement by reason of any failure to conduct an annual review. City does not waive any claim of defect or Default by Developer if, following periodic review as required by this Article V, City does not propose to 39 -19-
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modify or terminate this Agreement. City's failure to timely complete an annual review shall not constitute nor be asserted as a Default by Developer.

5.5 Reservation of Rights.

The rights and powers of the City Council under this Article V are in addition to, and shall not limit, the rights of the City to terminate or take other action under this Agreement on account of an event of Default by Developer.

ARTICLE VI

DEFAULT, REMEDIES, AND TERMINATION

6.1 Default.

A Party's violation of any material term of this Agreement or failure by any Party to perform any material obligation of this Agreement shall constitute a default ("Default").

Additionally, the occurrence of any of the following shall constitute a Default by Developer: (i) failure to pay when due any fee, tax, or payment required to be paid under this Agreement, City ordinance or resolution, or California State law, if the failure to pay continues for three (3) days after written notice of the failure from the City; (ii) failure to make the contributions or public benefit payments set out in Section 3.12.2 if failure to pay continues for three (3) days after written notice of the failure from the City; and (iii) operating the Cannabis Business in a manner that is not compliant with Belmont City Code Chapter 13 as may be amended. While Developer is in Default under this Agreement, City shall not be obligated to issue any permit or grant any Subsequent Approval until Developer cures the Default.

6.2 Remedies for Default.

City and Developer acknowledge that the purpose of this Agreement is to carry out the Parties' objectives as set forth in the Recitals. City and Developer agree that to determine a sum of money which would adequately compensate either Party for choices they have made which would be foreclosed should the Property not be developed as contemplated by this Agreement is not possible and that damages would not be an adequate remedy. Therefore, City and Developer agree that in the event of a breach of this Agreement, the only remedies available to the non-breaching Party shall be: (a) suits for specific performance to remedy a specific breach, (b) suits for declaratory or injunctive relief, (c) suits for mandamus under Code of Civil Procedure Section 1085, or special writs, and (d) termination or cancellation of this Agreement or, at the option of City in the event of breach by Developer, termination of the rights of Developer under this Agreement. Monetary damages shall not be awarded to either Party. This exclusion on damages is limited to a breach of this Agreement and shall not preclude actions by a Party to enforce payments of monies due or the performance of obligations requiring the expenditures of money under the terms of Section 3.12 of this Agreement. All of these remedies shall be cumulative and not exclusive of one another, and the exercise of any one or more of these remedies shall not constitute a waiver or election with respect to any other available remedy. Developer expressly agrees that the City, any City agencies and their respective elected and appointed councils, boards, commissions, officers, agents, employees, volunteers, and representatives (collectively, for the purposes of this Section 6.2, "City") shall not be liable for any monetary damage for a Default by 40 -20-
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the City or any claims against City arising out of this Agreement. Developer hereby expressly waives any such monetary damages against the City. Any legal action by a Party alleging a Default must be filed within ninety (90) days from date of Declaration of Default after following the procedures in Sections 6.3, 6.4, and 6.5, as applicable.

6.3 Notice and Procedure Regarding Defaults.

Before initiating any action for relief specified in Section 6.2 for an alleged breach of this Agreement, the Party claiming breach (the "Complaining Party") must deliver to the other Party (the "Defaulting Party") a written notice of breach (the "Notice of Default"). The Notice of Default must specify the reasons for the allegation of Default with reasonable particularity. Within thirty (30) days, unless a shorter period is provided in this Agreement, the Defaulting Party must either:
(a) use good faith efforts to cure the breach or, if such cure is of the nature to take longer than 30 days, to follow the procedures specified in Section 6.4 below, or (b) if in the determination of the Defaulting Party, the event does not constitute a breach of this Agreement, the Defaulting Party, within thirty (30) days of receipt of the Notice of Default, must deliver to the Complaining Party a notice which sets forth with reasonable particularity the reasons that a Default has not occurred.

Failure to respond within the thirty (30)-day period may not be deemed an admission of the Default, but the Complaining Party may proceed to pursue its remedies under this Article VI. After conclusion of the thirty (30)-day period, the Complaining Party may declare a Default by providing written notice to the Defaulting Party (the "Declaration of Default"), subject to the provisions of Section 6.4, and may proceed to pursue its remedies under this Article VI.

6.4 Mutual Agreement for Cure of Certain Defaults.

If the Defaulting Party believes that the Default cannot practically be cured within the thirty (30)-day period (or shorter period as provided in this Agreement), the Defaulting Party is not in Default provided that: (a) the cure is commenced during the applicable period after receipt of the Notice of Default; (b) within the thirty applicable period, the Defaulting Party provides a schedule to the Complaining Party for cure of the Default, subject to the reasonable approval of the Complaining Party; and (c) the cure is completed in accordance with the schedule agreed to by the Parties, or such additional time as agreed by the Complaining Party. If the Parties cannot mutually agree on a schedule for cure of the Default, at the conclusion of the initial thirty (30)-day period (or shorter period as provided in this Agreement), the Complaining Party may issue a Declaration of Default and proceed to pursue its remedies under this Article VI.

6.5 Alternative Procedure Regarding Defaults; Annual Review.

If the City Council determines, at the conclusion of the annual review undertaken as required by Article V, that Developer has not complied in good faith with the terms of this Agreement, then the determination constitutes a Declaration of Default, and City may proceed to pursue any remedies under this Article VI in addition to those remedies available under Article V.

6.6 Failure to Assert; No Waiver.

Any failures or delays by a Complaining Party in asserting any of its rights and remedies as to any Default shall not operate as a waiver of any Default or of any such rights or remedies. 41 -21-
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Delays by a Complaining Party in asserting any of its rights and remedies, irrespective of the length of the delay, shall not deprive the Complaining Party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert, or enforce any such rights or remedies, nor constitute a waiver of such Party's right to demand strict compliance by such other Party in the future. No waiver by a Party of a Default shall be effective or binding upon such Party unless made in writing by such Party, and no such waiver shall be implied from any omission by a Party to take any action with respect to such Default.

ARTICLE VII

ESTOPPEL CERTIFICATE
Either Party may request an estoppel certificate at the time of the annual compliance review, or within sixty (60) days of the annual compliance review. Either Party may, additionally, request an estoppel certificate at any other time by delivering written notice to the other Party, along with a complete periodic review application, including the required fee, as described in Section 5.2, requesting the other Party to certify in writing that, to the knowledge of that Party, (a) this Agreement is in full force and effect and is a binding obligation of the Parties, (b) this Agreement has not been amended or modified or, if so amended or modified, identifying the amendments or modifications, and (c) the requesting Party is not in Default in the performance of its obligations under this Agreement, or if in Default, to describe the nature of any Defaults. If this request is made by Developer, Developer shall pay any required fees in place at the time of request. The Party who receives the request shall execute and return the estoppel certificate within thirty (30) days following receipt of the request and items identified in Section 5.2, if required.

The City Manager shall be authorized to execute any certificate requested by Developer.

Developer and City acknowledge that a certificate hereunder may be relied upon by transferees and Mortgagees.

ARTICLE VIII

TRANSFERS, ASSIGNMENTS

8.1 Covenants Running with the Land.

Except as otherwise more specifically provided in Section 8.2 below, this Agreement and all of its provisions, rights, powers, standards, terms, covenants and obligations, shall be binding upon the Parties and their respective successors (by merger, consolidation, or otherwise) and assigns, and all other persons or entities acquiring the Property, or any interest therein, and shall inure to the benefit of the Parties and their respective successors and assigns, as provided in Government Code Section 65868.5.

8.2 Assignment and Transfer.

Developer and Property Owner shall not have the right to sell, assign, or transfer all or any part of its rights, title, and interests in all or a portion of the Property or Project subject to or a part of this Agreement, to any person, firm, corporation, or entity during the Term of this Agreement without consent of the City. This assignment prohibition applies to the corporate and business 42 -22-
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entities of Developer that are a Party to this Agreement. Any assignment or transfer prohibited by this Agreement will be considered an immediate breach of this Agreement and City may elect to immediate terminate this Agreement.

ARTICLE IX

MORTGAGEE PROTECTION

9.1 Mortgage Protection.

This Agreement shall be superior and senior to any lien placed upon the Property or any portion of the Property after the date of recording of this Agreement, including the lien of any deed of trust or mortgage ("Mortgage"). Notwithstanding the foregoing, no breach of this Agreement shall defeat, render invalid, diminish, or impair the lien of any Mortgage made in good faith and for value, but all of the terms and conditions contained in this Agreement (including but not limited to City's remedies to terminate the rights of Developer (and its successors and assigns) under this Agreement, to terminate this Agreement, and to seek other relief as provided in this Agreement) shall be binding upon and effective against any person or entity, including any deed of trust beneficiary or mortgagee ("Mortgagee") who acquires title to the Property, or any portion thereof, by foreclosure, trustee's sale, deed in lieu of foreclosure, or otherwise.

9.2 Mortgagee Not Obligated.

Notwithstanding the provisions of Section 9.1 above, no Mortgagee shall have any obligation or duty under this Agreement to construct or complete the construction of improvements on the Property, or to guarantee such construction or completion; provided, however, that a Mortgagee shall not be entitled to devote the Property to any uses or to construct any improvements on the Property other than those uses or improvements provided for or authorized by this Agreement, or otherwise under Applicable Law.

9.3 Notice of Default to Mortgagee.

If City receives a written notice from a Mortgagee, Developer or any approved assignee requesting a copy of any Notice of Default given Developer or any approved or permitted assignee and specifying the address for service, then City shall deliver to the Mortgagee at Mortgagee's cost (or Developer's cost), concurrently with service to Developer, any notice given to Developer with respect to any claim by City the Developer is in Default under this Agreement, and if City issues a Declaration of Default, City shall if so requested by the Mortgagee likewise serve at Mortgagee's cost (or Developer's cost) notice on the Mortgagee concurrently with service on Developer. Each Mortgagee shall have the right during the same period available to Developer to cure or remedy, or to commence to cure or remedy, the event of Default claimed in the Notice of Default or Declaration of Default.

9.4 No Supersedure.

Nothing in this Article IX shall be deemed to supersede or release a Mortgagee or modify a Mortgagee's obligations under any subdivision improvement agreement or other obligation incurred with respect to the Property outside this Agreement, nor shall any provision of this Article 43 -23-
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IX constitute an obligation of City to the Mortgagee, except as to the notice requirements of Section 9.3.

ARTICLE X

INDEMNIFICATION

10.1 No Duty of City; Hold Harmless.

It is specifically understood and agreed by the Parties that the Project contemplated by this Agreement is a private development, that City has no interest in or responsibility for or duty to third persons concerning any of said improvements, and that Developer shall have full power over and exclusive control of the Property subject only to the limitations and obligations of Developer under this Agreement.

10.2 Indemnification.

Developer hereby agrees to and shall indemnify, defend, and hold harmless City, any City agencies and their respective elected and appointed councils, boards, commissions, officers, agents, employees, volunteers, and representatives (collectively, for the purposes of this Section

This indemnification and hold harmless agreement applies to all damages and claims for damages suffered or alleged to have been suffered by reason of the operations referred to in this Section 10.2, regardless of whether or not City prepared, supplied, or approved plans or specifications for the Property, but does not apply to damages and claims for damages caused by City with respect to public improvements and facilities after City has accepted responsibility for them.

10.3 Joint and Several Liability.

Developer and Property Owner shall be jointly and severally liable for any amount due under this Agreement. Developer and Property Owner agree that the City may impose a lien and seek foreclosure on any parcel of the Property due to any default by Developer.

ARTICLE XI

NOTICES

11.1 Notices.
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Notices, demands, correspondence and communications between City, Developer, and Property Owner shall be sufficiently given if: (a) personally delivered; (b) dispatched by next day delivery by a reputable carrier such as Federal Express or DHL to the offices of City, Property Owner, and Developer indicated below, provided that a receipt for delivery is provided; or (c) sent by registered or certified mail, or express mail, return receipt requested, with postage prepaid.

City:

City Manager
City of Belmont
One Twin Pines Lane
Belmont, California 94002
With copy to:

City Attorney
City of Belmont
One Twin Pines Lane
Belmont, California 94002
Developer:

NUG CV BLMT, LLC
2601 C Blanding Avenue, STE 208
Alameda, CA 94501
With a copy to:
[Address info here, if a copy is to be sent]
Property Owner:

J & L Belmont Plaza LLC
843 Malcom Road
Burlingame, CA 94010
With a copy to:
[Address info here, if a copy is to be sent]
Any Party may change its mailing address at any time by giving written notice of such change to the other Party in the manner provided herein at least then (10) days prior to the date such change is effective. All notices under this Agreement shall be deemed given and received on the earlier of the date personal delivery is made or on the delivery date or attempted delivery date shown on the return receipt or air bill.
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ARTICLE XII

MISCELLANEOUS

12.1 Third-Party Legal Challenge.

In the event of any legal action, claim, or proceeding instituted by a third party or other governmental entity or official challenging the validity of any provision of this Agreement, the City Approvals, or the Subsequent Approvals ("Third Party Challenge"), the responsibilities of the Parties shall be as follows.

12.1.1 Indemnification.

The Developer shall bear its own costs of defense as a real party in interest in any Third Party Challenge, and the Developer shall reimburse City for all costs (including court costs and expenses) and attorneys' fees incurred by City in defense of such action or other proceeding. In its sole discretion, City may tender its defense of such action to Developer or defend the action itself. Upon a tender of defense to Developer by City, Developer shall defend through counsel approved by City, which approval shall not be unreasonably withheld, and Developer shall bear all attorneys' fees and costs from the date of tender. Under no circumstances shall Developer be required to pay or perform any settlement arising out of a Third Party Challenge unless the settlement is expressly approved by Developer.

12.1.2 City Cooperation.

The City shall promptly notify the Developer of any Third Party Challenge and shall cooperate fully in the defense of the Third Party Challenge.

12.1.3 Invalidity.

If any part of this Agreement is held by a court of competent jurisdiction to be invalid or unlawful as the result of a Third Party Challenge, the Parties shall use their best efforts to cure any inadequacies or deficiencies identified by the court in a manner consistent with the express and implied intent of this Agreement, and then to adopt or re-enact such part of this Agreement as necessary or desirable to permit implementation of this Agreement.

12.2 Bankruptcy.

The obligations of this Agreement shall not be dischargeable in bankruptcy.

12.3 Applicable Law/Venue.

This Agreement shall be construed and enforced in accordance with the laws of the State of California. Any legal actions under this Agreement shall be brought only in the Superior Court of the County of San Mateo, State of California.

12.4 Reimbursement of Development Agreement Costs and Fees. 46 -26-
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Developer shall reimburse City for all its reasonable and actual costs, fees, and expenses incurred in drafting, reviewing, revising, and processing this Agreement, including, but not limited to, recording fees, ordinance publication fees, staff time in preparing staff reports, and staff time, including legal counsel and special counsel fees, for preparation and review of this Agreement and changes requested by Developer.

12.5 Further Assurances.

Each Party covenants, on behalf of itself and its successors, heirs, and assigns, to take all actions and do all things, and to execute, with acknowledgment or affidavit if required, any and all documents and writings that may be necessary or proper to achieve the purposes and objectives of this Agreement.

12.6 Severability.

Except as otherwise provided herein, if any provision of this Agreement, or the application of this Agreement to any person or entity, be held invalid or unenforceable, the remainder of this Agreement, or its application to persons or entities, shall not be affected except as necessarily required by the determination of invalidity, and each term of this Agreement shall be valid and enforced to the fullest extent permitted by law unless amended or modified by mutual consent of the Parties, except if the effect of such a determination of invalidity is to deprive a Party of an essential benefit of its bargain under this Agreement, then the Party so deprived shall have the option to terminate this entire Agreement based on such determination.

12.7 Nondiscrimination.

Developer covenants by and for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, ancestry, or national origin in the development of the Property in furtherance of this Agreement. The foregoing covenant shall run with the land.

12.8 Developer Right to Rebuild.

City agrees that Developer may renovate or rebuild a development located on the Property within the Term of this Agreement should it become necessary due to natural disaster, including but not limited to fire, flood, or earthquake. Any such renovation or rebuilding shall comply with the Applicable Law and this Agreement.

12.9 Headings.

Section headings in this Agreement are for convenience only and are not intended to be used in interpreting or construing the terms, covenants, or conditions of this Agreement.

12.10 Agreement is Entire Understanding.

This Agreement is executed in one original, which constitutes the entire understanding and agreement of the Parties with respect to the subject matter hereof. Except as otherwise specified 47 -27-
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in this Agreement, any prior correspondence, memoranda, agreements, warranties, or representations are superseded in total by this Agreement.

12.11 Interpretation.

Each Party to this Agreement has had an opportunity to review the Agreement, confer with legal counsel regarding the meaning of the Agreement, and negotiate revisions to the Agreement.

Accordingly, neither Party shall rely upon Civil Code Section 1654 in order to interpret any uncertainty in the meaning of the Agreement.

12.12 Recordation of Termination.

Upon termination of this Agreement or expiration of the Term, a written statement acknowledging such termination shall be executed by Developer and City and shall be recorded by City in the Official Records of San Mateo County, California.

12.13 Signature Pages; Execution in Counterparts.

For convenience, the signatures of the Parties to this Agreement may be executed and acknowledged on separate pages in counterparts which, when attached to this Agreement, shall constitute this as one complete Agreement.
[Signatures on the Following Page]
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IN WITNESS HEREOF, the Parties have executed this Agreement as of the Effective Date.

CITY OF BELMONT,
a municipal corporation
By: ____________________________
Afshin Oskoui, City Manager
Dated: ____________________________

NUG CV BLMT, LLC
a California Limited Liability Company
By: ____________________________
By: ____________________________
Dated: ____________________________
ATTEST:

By: ____________________________
Jozi Plut, City Clerk
Dated: ____________________________
J & L Belmont Plaza LLC
a California Limited Liability Company
By: ____________________________
By: ____________________________
Dated: ____________________________
APPROVED AS TO FORM:

By: ____________________________
Scott Rennie, City Attorney
Dated: ____________________________
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ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

State of California )
County of ______________________ )
On _________________________, before me, ,
(insert name of notary)
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature (Seal)
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I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature (Seal)
51 EXHIBIT A
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EXHIBIT A

LEGAL DESCRIPTION OF THE PROPERTY
Real property in the City of Belmont, County of San Mateo, State of California, described as follows:

LOTS 11, 12, 13, 14, 15, 16, 17, 18, 19 AND 20 IN BLOCK 1, AS SHOWN ON THAT CERTAIN MAP ENTITLED "BAY VIEW HEIGHTS, SAN MATEO COUNTY, CALIF.", FILED IN THE

OFFICE OF THE COUNTY RECORDER OF SAN MATEO COUNTY, STATE OF CALIFORNIA, ON OCTOBER 18, 1926 IN BOOK 14 OF MAPS AT PAGE(S) 39 AND 40.

EXCEPTING THEREFROM THAT PORTION OF LOT 14, BLOCK 1 AS CONVEYED TO

THE STATE OF CALIFORNIA FOR HIGHWAY PURPOSES BY DEED RECORDED JUNE 30, 1930 IN BOOK 488, PAGE 72 OF OFFICIAL RECORDS.

ALSO EXCEPTING THEREFROM THOSE PORTIONS OF LOTS 11, 12 AND 13 IN BLOCK 1 AS CONVEYED TO THE STATE OF CALIFORNIA FOR HIGHWAY PURPOSES BY DEED RECORDED JULY 24, 1930 IN BOOK 482, PAGE 411 OF OFFICIAL RECORDS.

FURTHER EXCEPTING THEREFROM THAT PORTION OF LOT 15 IN BLOCK 1 AS

CONVEYED TO THE STATE OF CALIFORNIA FOR HIGHWAY PURPOSES BY DEED RECORDED JUNE 30, 1930 IN BOOK 483, PAGE 269 OF OFFICIAL RECORDS.

APN: 045-253-290, JPN : 045-025-253-29A
52 EXHIBIT B
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EXHIBIT B

ANNUAL REVIEW FORM
This Annual Review Form is submitted to the City of Belmont ("City") by __________________________________________ ("Developer") pursuant to the requirements of California Government Code Section 65865.1 and Section 28 of the Belmont City' Code regarding Owner's good faith compliance with its obligations under the Development Agreement between the City and Developer having an Effective Date of ________________, 20__ ("Development Agreement"). All terms not otherwise defined herein shall have the meanings assigned to them in the Development Agreement:

Annual Review Period: ______________ to ______________.

Describe in detail each Developer obligation included in the Development Agreement, including but not limited to those in Section 3.12, and describe in detail Developer compliance with each obligation.

Describe any extension as a result of enforced delay under Section 2.6 of the Development Agreement. Provide copies of any notices provided to the City under Section 2.6.

IN WITNESS WHEREOF, DEVELOPER has executed this Annual Review Form as of this _______ day of ______________, 20__.

DEVELOPER:
________________________,
a ___________________________
By: ______________________________
Name: ______________________________
Title: ______________________________
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RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BELMONT APPROVING

A CONDITIONAL USE PERMIT AND DESIGN REVIEW FOR THE NUG RETAIL CANNABIS DISPENSARY BUSINESS AT 1538 EL CAMINO REAL
WHEREAS, J&L Belmont Plaza, LCC (“Property Owner)”, is the fee owner of the real property located at 1538 El Camino Real within the City of Belmont; and, WHEREAS, NUG CV BLMT LLC, a California limited liability company (dba NUG) (“Developer”) has a leasehold interest in a portion of the Property and proposes to develop the Property for a cannabis retail use; and,
WHEREAS, the City received an application from Property Owner and Developer to establish a retail cannabis use on Property and seeking approval of an amendment to the Zoning Basemap Designation for the Property incorporating it into the S-3 Cannabis Retail and Distribution Overlay District, as well as Conditional Use Permit, Design Review, and Development Agreement entitlements (the “Project”); and,
WHEREAS, on March 4, 2025, the Planning Commission held a duly noticed public hearing to consider public testimony and a staff report for the Rezoning and Development Agreement requests, and rendered a recommendation as to whether the City Council should rezone the Property as requested and approve the development agreement for the NUG Business; and, WHEREAS, on March 11, 2025, the Zoning Administrator held a duly noticed public hearing to consider public testimony and a staff report for the proposed Conditional Use Permit and Design Review for the NUG Retail Cannabis Dispensary Business for the subject property; and, WHEREAS, on the March 25, 2025, the City Council held a duly noticed public hearing to take testimony from the public and the applicant, to consider the Planning Commission and Zoning Administrator recommendations, and to receive a staff report and information about the Project, and at the conclusion of the hearing introduced an ordinance rezoning 1538 El Camino Real into the S-3 Cannabis Overlay District, introduced an ordinance approving a development agreement for the project, and directed staff to place a resolution approving a Conditional Use Permit and Design Review for the project on the April 8, 2025 City Council agenda; and, WHEREAS, on April 8, 2025, the Council at a duly noticed regular meeting the Rezoning and Development Agreement Ordinances, and Conditional Use Permit & Design Review Resolutions were presented for adoption by Council in accordance with state law; and, WHEREAS, Council previously certified a Final Environmental Impact Report (FEIR) that evaluated the environmental impacts of the City’s 2035 General Plan, Phase I Zoning, Belmont Village Specific Plan (BVSP), and Climate Action Plan (CAP) on October 24, 2017 (the “General Plan EIR” – SCH #2016082075), making required findings under the California Environmental Quality Act (CEQA), adopting a Mitigation Monitoring and Reporting Program (MMRP), and a statement of overriding consideration for that project on November 14, 2017; and, WHEREAS, the City subsequently prepared an addendum examining the environmental effects of amending General Plan Land Use Element Section 2.4 and Policy 2.6-7, and establishing the S-3 Overlay District to allow up to two cannabisretail uses and one cannabis distribution use and found 54

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that the project would create no new effects or require new mitigation measures, and having considered the effects peculiar to the proposed Project at the Property, similarly finds the Project would create no new effects or require new mitigation measures.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BELMONT DOES RESOLVE AS FOLLOWS:

SECTION 1. CONDITIONAL USE PERMIT AND DESIGN REVIEW FINDINGS

1. The Council finds the above recitals are true and correct. The Council incorporates as part of its findings the findings in the Zoning Administrator and City Council staff reports previously presented to the Council.

2. The City Council may grant a Use Permit only if it finds the proposed use is in accordance with the provisions of the General Plan and the Belmont Zoning Ordinance and that the following findings (BZO Sections 10.7.3(a.1-4) and 21.4.1(b)(3.A-E) have been met. The City Council must deny the application for a Use Permit if it is unable to make the findings.

BZO Section Findings 10.7.3(a.1-4)
(1) The location of the proposed use is compatible to other land uses in the general neighborhood area and does not place an undue burden on existing transportation, utilities and service facilities in the vicinity.

The proposed NUG Retail Cannabis Business use would be located in the Corridor Mixed-Use (CMU) area along south El Camino Real, in proximity to main city arterials and mass public transportation options (bus and rail). The project site is currently developed with a vacant commercial space for the proposed NUG Retail Cannabis use that is currently served by all required utilities. An interior remodel of the building is proposed to accommodate the proposed Cannabis Retail Business. No upgrades or extension of transportation or utility facilities would be required for the project.

Representatives from the City’s Police Department and Fire District have not identified any service concerns for the project. A site circulation evaluation has been conducted by city staff. Parking for staff will be addressed within the existing commercial center parking lot.

Based on the foregoing, the location of the proposed project would not place an undue burden on parking, traffic circulation, or utilities serving the neighborhood, and would be compatible with surrounding uses in the established (November 2023) S-3 Cannabis Retail/Distribution Overlay District along South El Camino Real. This Finding is affirmed.
(2) The site is of sufficient size to accommodate the proposed use together with all yards, open spaces, walls and fences, parking and loading facilities, landscaping and such other provisions required by this Ordinance.

No expansion of the building is proposed; a remodel of the existing vacant (former Jenny Craig space) for the proposed NUG Retail Cannabis Business use is proposed. Compliant accessible parking is already provided in the commercial shopping center, and the project would meet its parking requirement (1 space for each 250 square feet of space) for retail 55

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commercial uses in the BZO. Building lighting would be upgraded to meet current city standards. Thus, the project site is of sufficient size to accommodate the proposed use.

This Finding is affirmed.
(3) The site will be served by streets of capacity sufficient to carry the traffic generated by the proposed use.

El Camino Real willserve the proposed NUG Retail Cannabis Business property at 1538 El Camino Real, and has sufficient capacity to carry the traffic generated by the proposed use.

This Finding is affirmed.
(4) The proposed use, if it complies with all conditions upon which approval is made contingent, will not adversely affect other property in the vicinity or the general welfare of the City.

All relevant City departments have reviewed the proposal and/or provided conditions of approval that should ensure that the proposed use will not adversely affect the general welfare of the City. Conditions of approval have been included that would require conformance with the California Building Code. The NUG Retail Cannabis Business is also required to comply with all Chapter 13 Belmont City Code Statutes and Regulations for Safety, Registration, and Operation. In particular, as per City Code Section 13-53, the Retail Cannabis Business shall obtain a Business Registration Certificate (i.e. Police Permit) prior to operation. Therefore, as proposed and with incorporation of and adherence to the conditions of approval, this Finding is affirmed.

BZO Section Findings 21.4.1(b)(3.A-E)
(A) The establishment of the proposed use complies with the applicable development regulations.

The proposed NUG Retail Cannabis Business has been evaluated in conjunction with the adopted BZO Section 21.4.1(c) Development Regulations. The proposed project either already complies with these established regulations or has been conditioned to comply.

This Finding is affirmed.
(B) For a Cannabis Retail Use Permit, there are no more than two lawfully approved Cannabis Retail uses and approval of the use permit will not result in more than two Cannabis Retail uses in the S-3 District.

There is one other Retail Cannabis Business proposed within the established (November 2023) S-3 south El Camino Real Retail/Distribution Cannabis Overlay District. Approval of the NUG Retail Cannabis Business Use will not result in more than two Cannabis Retail Uses in the S-3 District. This Finding is affirmed. (C) For a Cannabis Distribution Use Permit, there is no more than one lawfully approved Cannabis Distribution use and approval of the use permit will not result in more than one Cannabis Distribution use in the S-3 District.

The proposed NUG Cannabis Business at 1538 El Camino Real is retail based. No Cannabis Distribution Uses are currently proposed in the established S-3 District. This Finding is affirmed.
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(D)The use permit conditions require the use to comply with the performance standards in subsection (d) unless a modification is expressly approved by the permit.

The project (a proposed Retail Cannabis Business at 1538 El Camino Real) currently complies with or is conditioned to comply with the adopted (November 2023) BZO Section 21.4.1(d) Performance Standards. This Finding is affirmed. (E) The Police Department has reviewed and approved security and operations plans for the use at the proposed facility.

The Police Department (PD) has completed a preliminary review of the proposed NUG security/operational plans. The NUG Business application was also preliminarily checked and cleared by the Police Department (PD). Their operational and security plans were evaluated by the PD to ensure these plans meet all of the requirements described in the city ordinance. The NUG Security and Operational Plans have been conditionally approved. Final review, completion, and approval of the NUG Retail Cannabis Business Security/Operational plans will be required prior to obtaining a Business Registration Certificate (i.e. Police Permit) prior to an operation start for the business. A Condition of Approval is included requiring compliance with these requirements. This Finding is affirmed.

3. Under Belmont Zoning Ordinance (BZO) Section 13.2.1(b), design review is required for exterior alterations of structures in the CMU District. “Exterior Alteration” includes replacing elements such as windows or doors and repainting or refinishing with design, elements, materials or colors different than previously approved. As such, Design Review is required for this project in accordance with the Findings enumerated in BZO Section 13.5.2 (a-d) – see below:
(a) City staff and consultants have provided technical review and conditions of approval are included, as applicable, regarding project-related traffic, parking, grading, drainage, storm-water runoff, sanitary sewer impacts, vehicular and pedestrian access, site circulation, site stability, structural encroachments, and construction impacts.

City staff and consultants have completed the appropriate technical review for the project. No upgrades or extension of transportation or utility facilities would be required for the project.

The subject commercial shopping center provides both adequate and required parking for the business. No grading, drainage, sanitary sewer, vehicular/pedestrian, or construction impacts are anticipated. A site circulation evaluation has been conducted and approved by city staff.

Representatives from the City’s Police Department and Fire District have not identified any service concerns for the project. This Finding is affirmed. (b) The project is consistent with the landscape standards under Sections 13.3.1 as applicable.

Five new planter boxes will be installed within the parking lot adjacent to the building entrance; these planter boxes will be irrigated in conjunction with City requirements. The project will incorporate all required Water Efficient Landscape Ordinance (WELO) measures as required by the City and the Mid-Peninsula Water District (MPWD). All other existing landscaping would remain in the shopping center and no protected trees would be pruned, removed, or affected for the remodel of the existing commercial space for the NUG Business.

This Finding is affirmed.
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The project is consistent and compliant with all BZO development standards for the CMU District. The project has also been conditioned to comply with all Development Regulations and Performance Standards established for Cannabis Uses. This Finding is affirmed. (d) The project is consistent with the objective design standards in Section 13.6 as applicable.

The project involves an interior tenant improvement to the former Jenny Craig commercial shopping center space for the proposed NUG Retail Cannabis business. The proposed minor exterior improvements will be compatible with the architectural style and characteristics of the existing shopping center building. New paint will be applied to existing window trim elements for the building façade. The proposed improvements do not include the use of extreme colors. New wall signage is proposed for the front façade of the existing commercial building tenant space. The sign will be viewable from the commercial shopping center parking lot and El Camino Real. The wall sign will consist of black internally-illuminated channel letters illustrating the “NUG” business name and logo. The project lighting plans were evaluated by the Police Department to ensure these plans met all of the requirements described in the city ordinance. The lighting is designed to not cause spillover, glare, or trespass onto adjacent properties. This Finding is affirmed.

The proposed project is in compliance with BZO Section 13.2.1 requirements applicable to exterior alterations; the applicable findings in BZO Section 13.5.2 (a-d) can be made in the affirmative. Based on the foregoing analysis, the City Council approves of the project Design Review for the NUG Retail Cannabis Business for the subject property (1538 El Camino Real).

SECTION 2. DEVELOPMENT REGULATIONS AND PERFORMANCE STANDARDS As per Belmont Zoning Ordinance (BZO) Section 21.4.1(c) & (d), and in conjunction with the Conditional Use Permit for the proposed NUG Retail Cannabis Business, an assessment on the consistency and compliance with the adopted (November 2023) Cannabis Use Development Regulations and Performance Standards is required. Below is an analysis of those BZO regulations and standards.

BZO Section 21.4.1(c) - Development Regulations
(1) The use may only be established and operate inside a completely enclosed building.

The proposed NUG Retail Cannabis Business is designed, required, and conditioned to operate completely within the building. This regulation has been met. (2) The location of a Cannabis Retail or Cannabis Distribution use when initially established must comply with the following:
(A) The use must be at least 600 feet from a school or other Cannabis Retail or Cannabis Distribution use and at least 100 feet from parks and actively operated child day care centers.
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The proposed NUG Retail Cannabis Business (at 1538 El Camino Real) is located further than 600 feet from any school or other proposed Cannabis Retail Business (Canna-Bel at 1397 El Camino Real). The NUG Business is also located further than 100 feet from any park or actively operated child day care center. This regulation has been met. (B) The distances in subparagraph (A) are measured from the building containing the Cannabis Retail or Cannabis Distribution use by the length of the shortest path of travel over which the general public has a right to travel to the boundary of a property containing the incompatible use.

Appropriate business distance analysis has been completed in accordance with this regulation.

The NUG Business is in compliance with this regulation. (C) The public entrance to the Cannabis Retail or Cannabis Distribution use may not be located immediately adjacent to a youth-oriented business on the same frontage as the entrance.

The proposed NUG Retail Cannabis Business is not located adjacent to or near a youth-oriented business. This regulation has been met.
(3) The site and building must be suitably designed to be secure.

The NUG Business application was preliminarily checked and cleared by the Police Department (PD). Their security plan was evaluated by the PD to ensure the plan met all of the requirements described in the city ordinance. The NUG Security Plan has been conditionally approved, pending a compliance check when the installation and construction has been completed for the building/property. A Condition of Approval is included requiring compliance with this development regulation.

BZO 21.4.1(d) - Performance Standards
(1) State Licensing. The use must fully comply with all applicable operational rules and regulations governing commercial cannabis activity in Business & Professions Code Division 10.

The Police Department will contribute to the compliance analysis of this Performance Standard. A condition of approval is included requiring adherence to this performance standard. (2) Hours of Operation. A use may be open and operate only between the hours of 9:00 a.m. and 9:00 p.m.

The NUG Retail Cannabis Business will only be allowed to be open during the aforementioned operating hours. A condition of approval is included requiring compliance with this performance standard.
(3) Consumption. Consumption of cannabis on the premise must not be allowed.

A condition of approval is included requiring compliance with this performance standard. (4) Smoking. Smoking or vaping of any kind on premises must not be allowed.

A condition of approval is included requiring compliance with this performance standard. (5) Odor. Cannabis odor must not be detectible outside the building from any place accessible to the public or from adjoining private property.
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The new HVAC system for the proposed NUG Retail Cannabis Business building at 1538 El Camino Real will replace the existing system and be in full compliance with California Building Codes as well as the Rules and Regulations of the California Department of Cannabis.

As such, there is not an expectation of cannabis odor emanating from the (remodeled) building.

In addition, no cannabis will be permitted to be consumed in or around the premises by smoking or vaping. A condition of approval is included requiring compliance with this performance standard.
(6) Public services. Operation of the business must not place a burden on the provision of public services disproportionate to other retail uses.

The Police Department (PD) has completed a preliminary review of the proposed NUG operational/safety/security plan. Final review, completion, and approval of the aforementioned NUG Retail Cannabis Business plans will be required prior to obtaining a Business Registration Certificate (i.e. Police Permit) prior to an operation start for the business. The proposed retail cannabis business is not expected to create a disproportionate public service burden in comparison to other commercial retail uses within the community. A condition of approval is included requiring compliance with this performance standard. (7) Exterior Security Lighting. Adequate external lighting must be provided for security purposes. The lighting shall be sufficient to provide illumination and clear visibility to all outdoor areas, with minimal spillover on adjacent properties. The lighting must be stationary, directed away from adjacent properties and public rights-of-way, and compatible with the neighborhood.

The NUG Business application was preliminarily checked and cleared by the Police Department (PD). Both of their security and lighting plans were evaluated by the PD to ensure these plans met all of the requirements described in the city ordinance. The NUG Security & Lighting Plans have been conditionally approved, pending a compliance check when the installation and construction has been completed for the building/property. A Condition of Approval is included requiring compliance with this performance standard. (8) Security. On-site security must be provided for Cannabis Retail or Cannabis Distribution uses during the hours of operation when clients are present.

The NUG Security Plan was preliminarily checked and has been conditionally approved by the Police Department (PD), pending a compliance check when the installation and construction has been completed for the building/property. Their security plan was evaluated by the PD to ensure the plan meets all of the requirements described in the city ordinance. A Condition of Approval has also been included requiring compliance with this performance standard. (9) Commercial Cannabis Permit. The use must fully comply with all applicable local permit rules and regulations governing commercial cannabis activity, including operational permit requirements and conditions and approved operational plans under any other city ordinance or code.

The NUG Retail Cannabis Business is required to comply with all Chapter 13 Belmont City Code Statutes and Regulations for Safety, Registration, and Operation. In particular, as per City Code Section 13-53, the Retail Cannabis Business shall obtain a Business Registration Certificate (i.e. Police Permit) prior to operation. A condition of approval is included requiring compliance with this performance standard.
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(10) In the event of a conflict between the requirements of the use permit and the requirements of a local operations permit issued by the police department, the more restrictive performance requirements apply.

The Police Department (PD) review centered on the operational/safety plan, security plan, and state licensing to ensure that this use will operate in accordance with all applicable laws (i.e., use of products on site or in public places would be prohibited, security personnel would be required to prevent sales to minors and loitering, cannabis products and graphics representing cannabis products may not be visible from the exterior of the facility, and products must be stored and sold from inside the building.. Final review and completion of the operational/safety/security plan for the NUG Retail Cannabis Business will be required prior to obtaining a Business Registration Certificate (i.e. Police Permit) prior to an operation start for the business.

As proposed and to be conditioned, no noise, lighting, parking, traffic or circulation impacts are anticipated from the project. All relevant City departments have reviewed the proposal and will provide conditions of approval that should ensure that the proposed use will not adversely affect the general welfare of the City. A condition of approval is included requiring compliance with this performance standard.

13.5.2(a-d), the City Council approves the Conditional Use Permit and Design Review for the NUG Retail Cannabis Dispensary Business at 1538 El Camino Real subject to the Project Conditions of Approval in Exhibit A to this Resolution.

4. EFFECTIVE DATE.

This Resolution takes effect 30 days after its adoption. * * *
The City Council of the City of Belmont, California adopted the foregoing Resolution at a regular meeting held on April 8, 2025 by the following vote:

Ayes:

Noes:

Absent:

Abstain:

ATTEST:

City Clerk Mayor
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Conditions of Approval – Exhibit A
April 8, 2025 City Council
Conditional Use Permit and Design Review
NUG Cannabis Dispensary Business
1538 El Camino Real
Planning Application PA2024-0062
Community Development Department

1. Plans submitted for the building permit and all construction shall conform to the plans on file in the Planning Division. The Director of Community Development may approve minor modifications to the plans.

2. Prior to issuance of building permits, the property owners shall file with the Director of Community Development, on forms provided by the City, an acknowledgment that they have read, understand and agree to these conditions of approval.

3. Indemnification. Land Owner hereby agrees to and shall indemnify, defend, and hold harmless the City, any City agencies and their respective elected and appointed councils, boards, commissions, officers, agents, employees, volunteers, and representatives (collectively, for the purposes of this condition, "City") from any and all loss, liability, fines, penalties, forfeitures, costs, and damages (whether in contract, tort, or strict liability, including but not limited to personal injury, death at any time, and property damage) and from any and all third party claims, demands, and actions in law or equity (including attorneys' fees and litigation expenses) directly or indirectly arising or alleged to have arisen out of or in any way related to: (a) the validity of any zoning entitlement approval by the city; (b) any development or use of the Property under the City Approvals; and (c) any actions or inactions by the Land Owner or its contractors, subcontractors, agents, or employees in connection with the construction or improvement of the Property and the Project as defined in the development agreement; excepting to the extent arising from the intentional acts or willful misconduct of City, its elected and appointed representatives, officers, agents, employees, contractors or subcontractors.

This indemnification and hold harmless agreement applies to all damages and claims for damages suffered or alleged to have been suffered by reason of the operations referred to in this condition, regardless of whether or not City prepared, supplied, or approved plans or specifications for the Property, but does not apply to damages and claims for damages caused by City with respect to public improvements and facilities after City has accepted maintenance responsibility for them.

4. If any existing landscaping should be damaged during construction related activities, the applicant shall replace such landscaping, including consideration to utilize drought-tolerant plantings, prior to issuance of a planning final. Prior to building permit issuance, the applicant shall provide photographs of the property to document existing landscape conditions.

5. Comply with all established Cannabis Use Development Regulations as per Belmont Zoning Ordinance (BZO) Section 21.4.1(c).
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6. Comply with all established Cannabis Use Performance Standards as per Belmont Zoning Ordinance (BZO) Section 21.4.1(d). As per BZO Section 21.4.1(d).9, the Retail Cannabis Business shall obtain a Commercial Cannabis Permit which requires the use to fully comply with all applicable local permit rules and regulations governing commercial cannabis activity, including operational permit requirements and conditions and approved operational plans under any other city ordinance or code.

7. Comply with all executed terms for the NUG Cannabis Dispensary Business Development Agreement (DA).

Public Works Department

8. Any increases in sewer demand and upsizing of existing water services for proposed tenant improvements will require sewer lateral improvements. Confirm that there will be no additional fixture units for the project.

Police Department

9. The Cannabis Retail Business (NUG) shall comply with all Chapter 13 Belmont City Code Statutes and Regulations for Safety, Registration, and Operation. In particular, as per City Code Section 13-53, the Retail Cannabis Business shall obtain a Business Registration Certificate (i.e. Police Permit) prior to operation.

10. All activities shall be subject to the requirements of the Belmont Noise Ordinance.

11. No debris boxes or building materials shall be stored on the street unless permitted.

12. No parking of construction/employee vehicles shall be allowed in the roadway.

13. Any lane/road closures must only be conducted during non-commute hours (9am-3pm).

14. No Trespassing signs, as per California Penal Code (PC) Section 602, are required to be posted around the property to discourage unauthorized entry and aid in criminal prosecutions for trespassing/theft.

15. The property address must be clearly posted at all times during and after construction, visible and legible from entire roadway frontage(s).

Building Division

16. Specify that the 2022 California Code of Regulations as amended by the State of California and all applicable City of Belmont ordinances will be employed during this project.

17. A minimum of 65% of the construction waste generated by this project shall be recycled or salvaged for use. Documentation shall be provided before the final inspection. Sample forms found in A Guide to the California Green Building Standards Code (Residential) located at www.hcd.ca.gov/CALGreen.html may be used to assist in documenting compliance.

CALGreen Section 4.408.
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18. All construction and related activities (not including grading) may only be conducted during the hours of 8:00 a.m. to 5:00 p.m., Monday through Friday and 10:00 a.m. to 5:00 p.m., Saturdays. Grading may occur between the hours of 8:00 a.m. and 5:00 p.m. Monday through Friday. No construction activity (including grading) or related activities shall be allowed outside of the aforementioned hours or on Sundays and the following holidays: New Years Day, Presidents Day, Memorial Day, 4th of July, Labor Day, Thanksgiving Day and Christmas Day. All gasoline powered construction equipment shall be equipped with an operating muffler or baffling system as originally provided by the manufacturer, and no modification to these systems is permitted.

19. The applicant shall obtain all department final signatures prior requesting a Building Permit final.

20. Provide on the plans the existing and proposed locations of the electric and gas meters, subpanels, water heater and furnace.

21. The applicant shall post hours of operation and phone numbers for noise complaints.

22. The project building/site permits valuation shall determine the amount of accessibility provisions required. Accessibility features including hardship, if necessary, shall comply with 2022 California Building Code Chapter 11B.

23. Every building, or structure, shall be provided with an address. Numerals shall be located where clearly visible from the street or roadway upon which it fronts. Residential Structures shall have numerals a minimum of 4 inches in height and of stroke. Commercial Structures shall have numerals a minimum of 6 inches in height and inch stroke. Numerals shall be of contrasting color to their background and illuminated at night. Numerals shall be white in color where located upon glazing.

Fire Department

24. The applicant shall maintain required egress for all adjacent buildings/properties.

25. The applicant shall post temporary address numbers on each building at the project site that must be easily visible from the street or fire access road.

26. The applicant shall indicate on all building permit plans that all construction shall meet current code standards at the time of building permit submittal. The building permit plans are subject to review and approval by the Fire Marshal or his/her designee. 64 Meeting Date: April 8, 2025
Agency: City of Belmont
Staff Contact: Carlos de Melo, Community Development Director, (650) 595-7440 [email protected]
Agenda Title: 1397 El Camino Real & APN 045-243-050 – Rezone to S-3 Overlay District, Development Agreement, Conditional Use Permit, Design Review Agenda Action: Ordinance and Resolution
Recommendation
1) Adopt an Ordinance rezoning 1397 El Camino Real & APN 045-243-050 into the S-3 Cannabis Overlay District; and,
2) Adopt an Ordinance approving a development agreement for the Canna-Bel Retail Cannabis Dispensary Business; and,
3) Adopt a Resolution approving a Conditional Use Permit and Design Review for the Canna-Bel Retail Cannabis Dispensary Business for the subject properties.

Strategic Focus Area
Economic Development and Housing
Summary
At the March 25, 2025 City Council meeting, the Council voted 5-0 to: 1) introduce ordinances rezoning 1397 El Camino Real & APN 045-243-050 into the established S-3 Cannabis Overlay District, and approving a development agreement for the Canna-Bel Retail Cannabis Dispensary business; and 2) directed staff to place a resolution approving a Conditional Use Permit and Design Review for the project at the April 8, 2025 Council meeting. Attached are the Rezoning & Development Agreement Ordinances (For 2nd Reading & Adoption) and the Conditional Use Permit & Design Review Resolution.

Additionally, as part of the permit approval process, and in response to City Council feedback during the hearings, the applicants have agreed to incorporate additional governance measures into their Development Agreement regarding the distribution of the annual community benefit contribution.

Specifically, the applicant’s Community Advisory Board (CAB) will be composed of community stakeholders to recommend the allocation of funds to nonprofit organizations or activities serving Belmont residents. To ensure transparency and accountability, the applicants will provide the City with the CAB’s by-laws and conflict of interest policy as part of the annual Development Agreement review.

The CAB’s membership will also be disclosed annually, and no member shall have a personal financial interest in any recipient organization. While a recipient organization may share a board member with the CAB, this alone will not constitute a conflict as long as no financial interest exists. These provisions are 65

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1397 ECR & APN 045-243-050 Staff Memorandum – RZ-DA-CUP-DR intended to enhance community trust and ensure that funds are allocated fairly and in alignment with the City’s objectives for community benefit.

Alternatives

1. Refer back to staff for additional information.

2. Continue the item for further discussion.

Attachments

1. Rezone Ordinance & Exhibit A

2. Development Agreement Ordinance & Exhibit A

3. Conditional Use Permit and Design Review Resolution & Exhibit A – Conditions of Approval Fiscal Impact
☒ No Fiscal Impact
There is no direct fiscal impact to this action. Future operation of cannabis retail businesses within the City will generate revenue from business and sales taxes, as well as through community benefit contributions.
☐ Funding Source Confirmed:

Source: Purpose: Public Outreach:

Staff Council Vision/Priority Other*
*E-Notification of agendas, public notification as required for the April 8, 2025 City Council meeting 66

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ORDINANCE NO. ______

AN ORDINANCE OF THE CITY OF BELMONT REZONING PROPERTY LOCATED AT AND AROUND 1397 EL CAMINO REAL INTO THE S-3 CANNABIS RETAIL AND

DISTRIBUTION OVERLAY DISTRICT
WHEREAS, on July 25, 2023, the Belmont City Council provided direction to staff to explore consideration of Land Use Element Amendments to the 2035 General Plan that would potentially allow for commercial cannabis uses in the south El Camino Real area of the City; and, WHEREAS, on November 14, 2023, the Council adopted Resolution 2023-090 amending the Land Use Element of the 2035 General Plan to allow for commercial cannabis land uses in the south El Camino Real area of the City; and,
WHEREAS, 2035 General Plan Land Use Element Section 2.4 as amended declares that allowing commercial cannabis uses in appropriate commercial areas of the City should be considered and identifies the south El Camino Real as an area to be considered, and Policy 2.6-7 and actions 2.6-

7.1 and 2.6-7.2 established implementation goals of adopting a zoning overlay district for the area and establishing licensing regulations for commercial cannabis business; and, WHEREAS, on November 28, 2023, the Council adopted Ordinance 2023-1173 establishing the S-3 Cannabis Retail and Distribution Overlay District for the south El Camino Real area and regulations for the district; and,
WHEREAS, on February 13, 2024, the Council adopted Ordinance 2024-1176 establishing licensing regulations for cannabis businesses; and,
WHEREAS, Bechwati Properties, LCC (“Property Owner)”, is the fee owner of the real property located at 1397 El Camino Real within the City of Belmont and more particular shown on the Zoning Basemap Section attached hereto as Exhibit A (the “Property”) which is currently zoned Village Corridor Mixed Use (VCMU); and,
WHEREAS, Belmont A & E Green Solutions, Inc., a California corporation (dba Canna-Bel) (“Developer”) has a leasehold interest in the Property and proposes to develop the Property for a cannabis retail use; and,
WHEREAS, the City received an application from the Property Owner and Developer to establish a retail cannabis use on the Property and seeking approval of an amendment to the Zoning Basemap Designation for the Property and incorporating it into the S-3 Cannabis Retail and Distribution Overlay District, as well as Conditional Use Permit, Design Review, and Development Agreement entitlements (the “Project”); and,
WHEREAS, on March 4, 2025, the Planning Commission held a duly noticed public hearing to consider public testimony and a staff report for the request to rezone the Property, and rendered a recommendation as to whether the City Council should rezone the Property as requested; and, 67

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WHEREAS, on the March 25, 2025, the Council held a duly noticed public hearing to take testimony from the public and the applicant, to consider the Planning Commission’s recommendation, and to receive a staff report and information about the Project, and at the conclusion of the hearing introduced this ordinance; and, WHEREAS, on April 8, 2025, the Council at a duly noticed regular meeting the ordinance was presented for adoption by Council in accordance with state law.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BELMONT DOES ORDAIN AS FOLLOWS:

SECTION 1. LEGISLATIVE FINDINGS

2. The Council finds that adoption of this ordinance will not result in more than two retail cannabis businesses within the S-3 Overlay District and is consistent with BZO section

21.4.2(b)(2).

21.4.1(c)(2).

Page 3 of 3 ends

SECTION 2. ZONING BASEMAP AMENDED

1. The Zoning Map of the City is amended as follows. The property comprising 1397 El Camino Real and the adjoining parking lot included within APN 045-243-050, asshown on Exhibit A (Zoning Base Map Section), is incorporated into the S-3 Cannabis Retail and Distribution Overlay District and retains its VCMU district designation in accordance with Belmont Zoning Ordinance section 21.1.

SECTION 3. EFFECTIVE DATE.

Ayes:

Noes:

Absent:

Abstain:

ATTEST:

City Clerk Mayor
APPROVED AS TO FORM:

City Attorney
69 70

Page 1 of 3 ends

ORDINANCE NO. ______

AN ORDINANCE OF THE CITY OF BELMONT APPROVING A DEVELOPMENT AGREEMENT FOR A RETAIL CANNABIS PROJECT (CANNA-BEL) AT 1397 EL

CAMINO REAL IN THE CITY OF BELMONT
WHEREAS, Government Code Sections 65864 et seq. authorize the City of Belmont to enter into agreements for the development of real property with any person having a legal or equitable interest in such property in order to establish certain development rights in such property; and, WHEREAS, the City of Belmont has enacted Section 28 of the Belmont Zoning ordinance to govern the processing of development agreements by the City; and, WHEREAS, Bechwati Properties, LCC (“Property Owner)”, is the fee owner of the real property located at 1397 El Camino Real within the City of Belmont (the “Property”); and, WHEREAS, Belmont A & E Green Solutions, Inc., a California corporation (dba Canna-Bel) (“Developer”) has a leasehold interest in the Property and proposes to develop the Property for a cannabis retail use; and,
WHEREAS, Developer and Property Owner have applied for entitlements to improve the Property and operate a cannabis retail use on the Property, including a rezoning of the property into the S3 Cannabis Retail and Distribution Overlay District, a use permit and design review under Belmont Zoning Ordinance Section 21.4.1(b), and a development agreement (the “Project”), and, WHEREAS, to ensure that the intent of the City, Developer and Property Owner with respect to the approvals for the project entitlements is carried out, the parties desire voluntarily to enter into the Development Agreement, attached hereto and incorporated herein by reference as Exhibit A to Attachment “2”, to facilitate development of the Project subject to the conditions and requirements included in the Development Agreement; and WHEREAS, on March 4, 2025, the Planning Commission held a duly noticed public hearing to consider public testimony and a staff report for the requested development agreement, and rendered a recommend as to whether the City Council should approve the development agreement; and,
WHEREAS, on the March 25, 2025, the Council held a duly noticed public hearing to take testimony from the public and the applicant, to consider the Planning Commission’s recommendation, and to receive a staff report and information about the Project, and at the conclusion of the hearing introduced this ordinance; and, WHEREAS, on April 8, 2025, the Council at a duly noticed regular meeting at which the ordinance was presented for adoption by Council in accordance with state law.

Page 2 of 3 ends

WHEREAS, the City subsequently prepared an addendum examining the environmental effects of amending General Plan Land Use Element Section 2.4 and Policy 2.6-7, and establishing the S-3 Overlay District to allow up to two cannabis retail uses and one cannabis distributions use and found that the project would create no new effects or require new mitigation measures, and having considered the effects peculiar to the proposed Project at the Property, similarly finds the Project would create no new effects or require new mitigation measures.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BELMONT DOES ORDAIN AS FOLLOWS:

SECTION 1. FINDINGS
Based upon the findings of fact contained in the staff report to the City Council dated March 25, 2025, the presentation to the Council and supporting documents and any public testimony received, and in accordance with Government Code Section 65867.5(b) and Belmont Zoning Ordinance Section 28.8(b), the City Council finds that the provisions of the Development Agreement are consistent with the City's General Plan, the Belmont Village Specific Plan, and the zoning and other land use regulations applicable to the Property.

SECTION 2. DEVELOPMENT AGREEMENT APPROVAL
The Development Agreement for the Project is approved. The Council authorizes the City Manager to execute the Development Agreement on behalf of the City.

SECTION 4. EFFECTIVE DATE.

Ayes:

Noes:

Absent:

Abstain:
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Page 3 of 3 ends

ATTEST:

City Clerk Mayor
APPROVED AS TO FORM:

City Attorney
73 1750\36\3890249.2
Exhibit A to Attachment 2

RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of Belmont
City Clerk's Office
One Twin Pines Lane
Belmont, California 94002
Exempt from Recording Fee
Government Code Section 27383
(Space Above For Recorder's Use)

DEVELOPMENT AGREEMENT
By and Between

THE CITY OF BELMONT
and
BELMONT A & E GREEN SOLUTIONS, INC.

DBA CANNA-BEL
Related to the
Entitlement of a Retail Cannabis Use at 1397 El Camino Real 74 TABLE OF CONTENTS
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ARTICLE I DEFINITIONS .........................................................................................................3

1.1 Definitions.............................................................................................................3

1.2 Capitalized Terms. ................................................................................................4

1.3 Exhibits. ................................................................................................................4 ARTICLE II GENERAL PROVISIONS......................................................................................4

2.1 Parties....................................................................................................................4

2.2 Description of Property.........................................................................................7

2.3 Effective Date. ......................................................................................................7

2.4 Execution and Recording......................................................................................7

2.5 Term......................................................................................................................7

2.6 Suspension. ...........................................................................................................7

2.7 Termination...........................................................................................................8

2.8 Force Majeure. ......................................................................................................8

2.9 Provisions Required by Statute.............................................................................9 ARTICLE III DEVELOPMENT OF THE PROPERTY..............................................................9

3.1 Use of the Property and Applicable Law..............................................................9

3.2 No Conflicting Enactments.................................................................................10

3.3 Fees and Taxes....................................................................................................11

3.4 Timing of Development......................................................................................11

3.5 Reservations of Authority...................................................................................11

3.6 Subsequently Enacted Rules and Regulations. ...................................................12

3.7 Initiatives and Referenda. ...................................................................................12

3.8 Compliance with Requirements of Other Governmental Entities. .....................12

3.9 City's Police Power. ............................................................................................13

3.10 Subsequent Development Approvals for the Property........................................14

3.11 Life of City Approvals and Subsequent Approvals. ...........................................14

3.12 Developer Obligations and Public Benefits........................................................14

3.13 Mutual Obligations of the Parties. ......................................................................15

ARTICLE IV AMENDMENT, CANCELLATION, AND TERMINATION OF
AGREEMENT....................................................................................................16

4.1 Amendment or Cancellation Procedure. .............................................................16

4.2 Requirement for a Writing..................................................................................16

4.3 Amendments to Development Agreement Legislation.......................................16

4.4 Amendment of City Approvals...........................................................................17

4.5 Effect of Termination on Developer's Rights and Obligations...........................17 ARTICLE V ANNUAL REVIEW .............................................................................................18

5.1 Time of Review...................................................................................................18

5.2 Required Information from Developer. ..............................................................18 75 TABLE OF CONTENTS
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5.3 Determination of Good Faith Compliance..........................................................18

5.4 No Waiver...........................................................................................................19

5.5 Reservation of Rights..........................................................................................19 ARTICLE VI DEFAULT, REMEDIES, AND TERMINATION..............................................19

6.1 Default.................................................................................................................19

6.2 Remedies for Default. .........................................................................................19

6.3 Notice and Procedure Regarding Defaults..........................................................20

6.4 Mutual Agreement for Cure of Certain Defaults. ...............................................20

6.5 Alternative Procedure Regarding Defaults; Annual Review. .............................21

6.6 Failure to Assert; No Waiver. .............................................................................21 ARTICLE VII ESTOPPEL CERTIFICATE ..............................................................................21 ARTICLE VIII TRANSFERS, ASSIGNMENTS ......................................................................22

8.1 Covenants Running with the Land......................................................................22

8.2 Assignment and Transfer. ...................................................................................22 ARTICLE IX MORTGAGEE PROTECTION ..........................................................................22

9.1 Mortgage Protection............................................................................................22

9.2 Mortgagee Not Obligated. ..................................................................................22

9.3 Notice of Default to Mortgagee. .........................................................................23

9.4 No Supersedure...................................................................................................23 ARTICLE X INDEMNIFICATION...........................................................................................23

10.1 No Duty of City; Hold Harmless. .......................................................................23

10.2 Indemnification...................................................................................................23

10.3 Joint and Several Liability. .................................................................................24 ARTICLE XI NOTICES.............................................................................................................24

11.1 Notices. ...............................................................................................................24 ARTICLE XII MISCELLANEOUS...........................................................................................25

12.1 Third-Party Legal Challenge...............................................................................25

12.2 Bankruptcy..........................................................................................................26

12.3 Applicable Law/Venue. ......................................................................................26

12.4 Reimbursement of Development Agreement Costs and Fees.............................26

12.5 Further Assurances..............................................................................................26

12.6 Severability. ........................................................................................................26

12.7 Nondiscrimination...............................................................................................26

12.8 Developer Right to Rebuild. ...............................................................................26

12.9 Headings. ............................................................................................................27 76 TABLE OF CONTENTS
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12.10 Agreement is Entire Understanding....................................................................27

12.11 Interpretation.......................................................................................................27

12.12 Recordation of Termination................................................................................27

12.13 Signature Pages; Execution in Counterparts.......................................................27 77 1750\36\3890249.2

DEVELOPMENT AGREEMENT
THIS DEVELOPMENT AGREEMENT (the "Agreement") is made and entered into on the _____ day of __________, 2025, by and between the CITY OF BELMONT, a municipal corporation ("City"), and Belmont A & E Green Solutions, Inc. (dba Canna-Bel), a California corporation ("Developer") and Bechwati Properties LLC, a California Limited Liability Company, (the "Property Owner"), under the authority of Sections 65864 – 65869.5 of the California Government Code and Section 28 of the Belmont Zoning Ordinance. The City, Developer, and Property Owner are, from time to time, individually referred to in this Agreement as a "Party" and collectively referred to as the "Parties."

C. Government Code Section 65865 requires than an applicant for a development agreement hold a legal or equitable interest in the real property that is the subject of the development agreement.

F. The following approvals, entitlements, and findings were adopted by the City with respect to the Project after duly and properly noticed public hearings:
i. On April 8, 2025, the Council found the Project consistent with the certified Final Environmental Impact Report (FEIR) that evaluated the environmental impacts of the City’s 2035 General Plan, Phase I Zoning, Belmont Village Specific Plan (BVSP), and Climate Action 78 -2-
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Plan (CAP) on October 24, 2017 (the “General Plan EIR” – SCH #2016082075) under the California Environmental Quality Act (CEQA), found the Project would create no new effects or require new mitigation measures, and that no further environmental document was needed. ii. On April 8, 2025, the City Council adopted Ordinance No. ___________, rezoning the Property to the S-3 Overlay District.
iii. On April 8, 2025, the City Council adopted Resolution No. _________, approving the Conditional Use Permit for the Cannabis Retail use. iv. On April 8, 2025 the City Council adopted Ordinance No. ______ approving this Development Agreement as more fully set forth below.

I. The Planning Commission reviewed this Agreement at a public hearing held on March 4, 2025 and as part of its recommendation to the City Council determined that this Agreement is consistent with the City's general plan, any applicable specific plan, and any zoning or land use regulations applicable to the Property.

J. The City Council reviewed this Agreement at a public hearing held on March 25, 2025 and found that the provisions of this Agreement are consistent with the City's general plan and any applicable specific plan and are consistent with the zoning and other land use regulations applicable to the property, as well as the Development Agreement Statute, and, therefore, approved this Agreement by Ordinance No. ______________, introduced on March 25, 2025 and adopted on April 8, 2025 (the "Adoption Date"). Ordinance No. _______ (the "Enacting Ordinance") will become effective on May 8, 2025 (the "Effective Date").

NOW, THEREFORE, with reference to the foregoing Recitals and in consideration of the mutual promises, obligations and covenants herein contained, City and Developer agree as follows:

AGREEMENT
The introductory paragraph, the Recitals, and all defined terms set forth therein are hereby incorporated into this Agreement as if hereinafter fully and completely rewritten. 79 -3-
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ARTICLE I

DEFINITIONS

1.1 Definitions.

The following defined terms are used in this Agreement:

1.1.1 "Adoption Date" is defined in Recital J.

1.1.2 "Agreement" is defined in the first paragraph, page 1.

1.1.3 "Annual Review Form" is defined in Section 5.2.

1.1.4 "Applicable Law" is defined in Section 3.1.4.

1.1.5 "Assignment" is defined in Section 8.2.

1.1.7 "Cannabis Retail" means a use involving the retail sale of cannabis or cannabis products to customers at fixed located locations or by delivery.

1.1.8 "CEQA" is defined in Recital F.

1.1.9 "City" is defined in the first paragraph, page 1 and in Section 2.1.1.

1.1.10 "City Approvals" is defined in Recital F.

1.1.11 "City Council" is defined in Recital A.

1.1.12 "City Law" is defined in Section 3.2.

1.1.13 "Complaining Party" is defined in Section 6.3.

1.1.14 "Declaration of Default" is defined in Section 6.3.

1.1.15 "Default" is defined in Section 6.1.

1.1.16 "Defaulting Party" is defined in Section 6.3.

1.1.17 "Development Agreement Statute" is defined in Recital A.

1.1.18 "Developer" is defined in the first paragraph, page 1 and in Section 2.1.2.

1.1.19 "Effective Date" is defined in Recital J and in Section 2.3.

1.1.20 "Enacting Ordinance" is defined in Recital J.
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1.1.21 "Impact Fees" are defined in Section 3.3.1.

1.1.22 "Notice of Default" is defined in Section 6.3.

1.1.23 "Party" and "Parties" are defined in the first paragraph, page 1.

1.1.24 "Project" is defined in Recital F.

1.1.25 "Property" is defined in Recital D.

1.1.26 "Property Owner" is defined in the first paragraph, page 1.

1.1.27 "Subsequent Approvals" is defined in Recital G.

1.1.28 "Term" is defined in Section 2.5.

1.1.29 "Third Party Challenge" is defined in Section 12.1.

1.1.30 "Vesting Statutes" is defined in Section 3.12.3.

1.2 Capitalized Terms.

If any capitalized terms contained in this Agreement are not defined above, then any such terms shall have the meaning otherwise ascribed to them in this Agreement.

1.3 Exhibits.

The following Exhibits are attached hereto and incorporated into this Agreement:

Exhibit A: Legal Description
Exhibit B: Annual Review Form

ARTICLE II

GENERAL PROVISIONS

2.1 Parties.

2.1.1 The City.
(a) The City is a municipal corporation duly organized and validly existing under the laws of the State of California. The office of the City is located at One Twin Pines Lane, Belmont, California 94002. "City," as used in this Agreement, includes the City of Belmont and any assignee or successor to its rights, powers and responsibilities. (b) The City represents and warrants that, as of the Effective Date of this Agreement:
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(i) The execution and delivery of this Agreement and the performance of the obligations of City have been duly authorized by all necessary actions and approvals required for a municipal corporation;
(ii) The City is in good standing and has all necessary powers under the laws of the State of California and in all other respects to enter into and perform the undertakings and obligations of this Agreement; and
(iii) This Agreement is a valid obligation of City enforceable in accordance with its terms.

2.1.2 The Developer.
(a) Developer is Belmont A&E Green Solutions, Inc., a California corporation. For the purposes of this Agreement the Developer's office is located at 2052 Monroe Avenue, Belmont California, 94002.
(b) Developer represents and warrants that, as of the Effective Date of this Agreement, Developer:
(i) Has entered into a lease agreement with Property Owner of the Property;
(ii) Is duly organized and validly existing under the laws of the State of California;
(iii) Is qualified and authorized to do business in the State of California and has duly complied with all requirements pertaining thereto; and (iv) Is in good standing and has all necessary powers under the laws of the State of California to lease property and in all other respects enter into and perform the undertakings and obligations of this Agreement.
(c) Developer further represents and warrants:
(i) That no approvals or consents of any persons are necessary for the execution, delivery or performance of this Agreement by Developer, except as have been obtained;
(ii) That the execution and delivery of this Agreement and the performance of the obligations of Developer have been duly authorized by all necessary actions and approvals required under any partnership or other agreement for the limited partnership constituting Developer;
(iii) That this Agreement is a legal, valid, and binding obligation of Developer enforceable in accordance with its terms;
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(iv) That the execution, delivery, and performance of this Agreement by the Developer does not and will not materially conflict with, or constitute a material violation or material breach of, or constitute a default under (a) the partnership agreements of the Developer, (b) any law, rule, or regulation binding upon or applicable to the Developer, or (c) any material agreements to which Developer is a party;
(v) That, unless otherwise disclosed in writing to the City prior to the date of Council adoption of this Agreement and except for threats of litigation expressed in public hearings relating to the City Approvals, to the Developer's actual knowledge, there is no existing or pending or threatened litigation, suit, action, or proceeding before any court or administrative agency affecting the Developer or the Property that would, if adversely determined, materially and adversely affect the Developer's ability to perform its obligations under this Agreement or to develop and operate the Project; and
(vi) That Developer or any person or entity owning or operating the Property, has duly obtained and maintained, or will duly obtain and maintain, all licenses, permits, consents, and approvals required by all applicable governmental authorities to develop, sell, lease, own, and operate the Project on the Property.

2.1.3 The Property Owner.
(a) Property Owner is Bechwati Properties, LLC, a California Limited Liability Company. For the purposes of this Agreement the Property Owner's office is located at 43053 Sabercat Place, Fremont California 94539.
(b) Property Owner represents and warrants that, as of the Effective Date of this Agreement, Property Owner:
(i) Is the legal owner of the Property;
(ii) Has entered into a lease agreement with Developer; (iii) Consents to the terms of this Agreement;
(iv) Consents to the recordation of this Agreement against the title of the Property.

2.1.4 Relationship of City and Developer.

This Agreement does not require the Developer or Developer's contractors to pay prevailing wages if the Project is not a "public work" apart from any potentially applicable State Labor Code requirements and implementing regulations of the Department of Industrial Relations pertaining to "public works" (collectively, "Prevailing Wage Laws"). The Parties agree and acknowledge that the City makes no representation as to the applicability of Prevailing Wage Laws to the Project, and it is the Developer's sole responsibility to determine which, if any, Prevailing Wage Laws apply.

2.2 Description of Property.

The Property which is the subject of this Agreement is described in Exhibit A attached hereto.

2.3 Effective Date.

This Agreement shall become effective upon the effective date of the Enacting Ordinance approving this Agreement (the "Effective Date"), as set forth in Recital J of this Agreement.

2.4 Execution and Recording.

2.5 Term.

2.6 Suspension.

The Developer must cease all Cannabis Business operations, upon notification by the City of the occurrence of any of the following events ("Suspension Event"):

2.6.1 the Developer is in Default and has not cured such Default in accordance with Sections 6.2 and 6.3 of this Agreement;
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2.6.2 the Developer operates the Cannabis Business in a manner that endangers public health and safety, including but not limited to (i) failing to prevent conduct of patrons in and around the immediate vicinity of the Property that is disruptive, creates excessive noise, constitutes a nuisance, or is unlawful, (ii) failing to deter crimes against patrons on the Property or in the immediate vicinity of the Property, or (iii) failing to operate the business in strict accordance with all state and local permits and regulatory requirements;

2.6.3 any permit or license necessary to operate a Cannabis Business is suspended.

2.7 Termination.

This Agreement shall terminate upon the occurrence of any of the following events:

2.7.1 the expiration of the Term;

2.7.2 the Developer no longer has a possessory, legal or other equitable interest in the Property;

2.7.3 the Developer has ceased all operations related to the Project on the Property for a period of thirty (30) consecutive days;

2.7.4 Federal enforcement of the Federal Controlled Substances Act against Developer, Property Owner, or City;

2.7.5 any permit or license necessary to operate a Cannabis Business is terminated;

2.7.6 pursuant to a public hearing or other termination in accordance with Section

2.6. Upon termination of this Agreement, either by expiration of otherwise, Developer shall have no right to engage in any Cannabis Business on the Property, except as the City Council may affirmatively allow by appropriate subsequent action.

2.8 Force Majeure.
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2.8.1 Performance by either City or Developer shall not be deemed to be in Default, and the Term shall be extended, where delays are due to: (a) natural disasters that are not caused by, are outside the reasonable control of, and at the time of entering into this Agreement are not known to and cannot be anticipated by the Developer, including without limitation floods, earthquakes, and fires; (b) a fire or flood during construction after issuance of a building permit, whether or not the result of a natural disaster, a third party, or negligence by Developer or Developer's employee, agent or contractor (but not intentional acts or gross misconduct of the Developer); and (c) third-party litigation challenging this Agreement, the City Approvals, or the Subsequent Approvals, which delays any activity contemplated herein.

Notwithstanding this Section 2.6, the limitation on Impact Fees provided in Section 3.3 below may not be extended due to enforced delay.

2.9 Provisions Required by Statute.

The Development Agreement Statute provides, among other things, that a development agreement shall specify the following:

2.9.1 Duration of the Agreement. See Sections 2.5 and 2.6 of this Agreement.

2.9.2 Permitted Uses of the Property. See Section 3.1.2 of this Agreement.

2.9.3 Density or Intensity of Uses. See Section 3.1.2 of this Agreement and the City Approvals.

2.9.4 Maximum Height and Size of Proposed Buildings. See Section 3.1.2 of this Agreement and the City Approvals.

2.9.5 Reservation or Dedication of Land for Public Purposes. See Section 3.1.2 of this Agreement and the City Approvals.

2.9.6 Periodic Review at Least Annually. See Article V of this Agreement.

ARTICLE III

DEVELOPMENT OF THE PROPERTY

3.1 Use of the Property and Applicable Law.

3.1.1 Subject to Agreement.
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The Property is hereby made subject to the provisions of this Agreement. All development of, or on, the Property, or any portion thereof, shall be undertaken only in compliance with the provisions of this Agreement and with Applicable Law. Developer shall additionally be required to obtain all state required licenses required for the operation of a Cannabis Business.

3.1.2 Permitted Uses.

3.1.3 Laws Governing Cannabis Activities.

3.2 No Conflicting Enactments.

3.2.1 Changes any land use designation or permitted use of the Property from that shown in Applicable Law;

3.2.2 Limits or controls the rate, timing, phasing or sequencing of the approval, development, or construction of all or any part of the Property except as set forth in Applicable Law; or

3.2.4 Imposes any requirements for reservation or dedication of land for public purposes except as set forth in Applicable Law.

3.3 Fees and Taxes.

3.4 Timing of Development.

3.5 Reservations of Authority.

3.5.3 Procedural regulations relating to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals and any other matter of 88 -12-
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procedure, which are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for.

3.6 Subsequently Enacted Rules and Regulations.

3.7 Initiatives and Referenda.

3.8 Compliance with Requirements of Other Governmental Entities.

3.8.1 During the Term, Developer, at no cost to City, shall comply with lawful requirements of, and obtain all permits and approvals required by other local, regional, state and federal agencies having jurisdiction over Developer's activities in furtherance of this Agreement. 89 -13-
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Developer shall pay all required fees when due to federal, state, regional, or other local governmental agencies other than the City and acknowledges that City does not control the amount of any such fees.

3.9 City's Police Power.

The Parties acknowledge this Agreement constitutes a lawful limitation on the City's police power. The Parties further acknowledge and agree that the limitations, reservations, and 90 -14-
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exceptions contained in this Agreement are intended to reserve to the City that part of its police power which are not otherwise addressed in this Agreement, and this Agreement shall be construed to reserve to the City those parts of its police powers which cannot be restricted by contract. Subject to the limitations specified in this Agreement, the City intends that rules, regulations, official policies, standards and specifications of City applicable to the development of the Project shall be the Applicable Law.

3.10 Subsequent Development Approvals for the Property.

3.11 Life of City Approvals and Subsequent Approvals.

3.12 Developer Obligations and Public Benefits.

3.12.1 Compliance with Agreement and Applicable Law. In addition to any other obligations of Developer set forth herein, in consideration of City entering into this Agreement, Developer has agreed that if Developer commences development of the Property and proceeds to develop the Property, such development shall be in conformance with all of the terms, covenants, and requirements of this Agreement and Applicable Law, and Developer shall perform those specific obligations and provide those specific contributions identified in the conditions of 91 -15-
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approval and exhibits to the City Approvals. Developer shall pay when due all fees and costs which are imposed on all or any portion of the Property, whether imposed by City or other agencies, as provided in this Article III.

3.12.2 Public Benefits. In addition to the other benefits identified in Section 3.12, the Project will provide an annual public benefit contribution of one and a half percent (1.5%) of gross receipts from operations of the Cannabis Business, to be contributed at the time of the business license tax payment (no later than February 28 of each year), distributed as follows:
(a) Forty percent (40%) to Belmont Community Foundation.

Developer shall provide documentation to the City's satisfaction demonstrating that this contribution was made. If this foundation ceases to exist, Developer shall provide these funds to the City and the City may use these funds as it deems appropriate. (b) Thirty percent (30%) to the City to be used for Parks and Recreation Department programming, scholarships, and capital needs. (c) Thirty percent (30%) to be distributed on an annual basis to one or more nonprofit organizations or activities serving city residents based on the recommendation of the Canna-Bel Community Advisory Board, which is to be made up of Belmont community stakeholders. The membership of the Advisory Board shall be disclosed on an annual basis as part of the annual review of the Development Agreement obligations as outlined in Section 5.2. No member of the Advisory Board shall have a personal financial interest in any organization that is a recipient of a distribution. A recipient organization may share a common board member with the Advisory Board and this, alone, will not create a violation of this section as long as that member does not have a personal financial interest in the outcome. Developer will provide the City with a copy of the current by-laws for the Canna-Bel Community Advisory Board as part of the annual review. The by-laws are to include a conflict of interest policy and criteria for selecting the nonprofit organizations or activities serving city residents that will receive funds under this paragraph.

3.13 Mutual Obligations of the Parties.
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City has agreed to provide Developer with the long term assurances, vested rights, and other City obligations described in this Agreement, including in particular those obligations described in this Article III, in consideration for the Developer obligations contained in this Agreement, including in particular those Developer obligations described in this Article III.

Developer has agreed to provide City with the Developer obligations contained in this Agreement, including in particular those Developer obligations described in this Article III, in consideration for the City obligations described in this Agreement, including in particular those obligations described in this Article III. To ensure that the understanding of the Parties and mutual consideration remain effective, should either Party bring any administrative, legal, or equitable action or other proceeding to set aside or otherwise make ineffective any of the City or Developer obligations described in this Agreement, this Agreement may be terminated by the Party against whom the proceeding is brought at that Party's sole discretion.

ARTICLE IV

AMENDMENT, CANCELLATION, AND TERMINATION OF AGREEMENT

4.1 Amendment or Cancellation Procedure.

4.2 Requirement for a Writing.

4.3 Amendments to Development Agreement Legislation.

4.4 Amendment of City Approvals.

4.5 Effect of Termination on Developer's Rights and Obligations.

ARTICLE V

ANNUAL REVIEW

5.2 Required Information from Developer.

It is the Developer's responsibility to apply in a timely fashion for the annual review by submitting a written request to the Community Development Director, including a completed Annual Review Form in the form provided in Exhibit B (the "Annual Review Form") no more than sixty (60) and no less than thirty (30) days prior to the review date. The burden of proof, by substantial evidence, of good faith compliance shall be upon Developer. Developer shall provide the evidence determined necessary by the Community Development Director to demonstrate good faith compliance with the provisions of this Agreement. Developer shall provide detailed evidence of Developer's compliance with each obligation under this Agreement, including but not limited to the provisions of Section 3.12 and other information reasonably requested by the Community Development Director to determine compliance. The Community Development Director may conduct the annual review notwithstanding Developer's failure to submit the written request.

Failure to submit the written request or to list or describe compliance with an obligation is substantial evidence that the Developer has not complied in good faith with the obligation and the provisions of this Agreement. Costs reasonably incurred by the City in connection with the annual review and any related hearings shall be paid by Developer in accordance with the City's schedule of fees in effect at the time of review.

5.3 Determination of Good Faith Compliance.

If the City Council determines, based upon substantial evidence that Developer has complied in good faith with the terms and conditions of this Agreement, the annual review shall 95 -19-
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be concluded. If, however, the City Council determines, based upon substantial evidence, that Developer has not complied in good faith with the terms and conditions of this Agreement, the City Council may terminate or modify this Agreement as authorized by Government Code Section 65865.1 after complying with the provisions of this Agreement and the notice and hearing procedures contained in Belmont Zoning Ordinance Section 28 or successor provision.

5.4 No Waiver.

Failure of City to timely conduct an annual review shall not constitute a waiver by City of its right to do so at a later date nor a waiver of its rights to otherwise enforce the provisions of this Agreement, nor shall Developer have or assert any defense to such enforcement by reason of any failure to conduct an annual review. City does not waive any claim of defect or Default by Developer if, following periodic review as required by this Article V, City does not propose to modify or terminate this Agreement. City's failure to timely complete an annual review shall not constitute nor be asserted as a Default by Developer.

5.5 Reservation of Rights.

ARTICLE VI

DEFAULT, REMEDIES, AND TERMINATION

6.1 Default.

A Party's violation of any material term of this Agreement or failure by any Party to perform any material obligation of this Agreement shall constitute a default ("Default").

6.2 Remedies for Default.

City and Developer acknowledge that the purpose of this Agreement is to carry out the Parties' objectives as set forth in the Recitals. City and Developer agree that to determine a sum of money which would adequately compensate either Party for choices they have made which would be foreclosed should the Property not be developed as contemplated by this Agreement is not possible and that damages would not be an adequate remedy. Therefore, City and Developer agree that in the event of a breach of this Agreement, the only remedies available to the non-breaching 96 -20-
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Party shall be: (a) suits for specific performance to remedy a specific breach, (b) suits for declaratory or injunctive relief, (c) suits for mandamus under Code of Civil Procedure Section 1085, or special writs, and (d) termination or cancellation of this Agreement or, at the option of City in the event of breach by Developer, termination of the rights of Developer under this Agreement. Monetary damages shall not be awarded to either Party. This exclusion on damages is limited to a breach of this Agreement and shall not preclude actions by a Party to enforce payments of monies due or the performance of obligations requiring the expenditures of money under the terms of Section 3.12 of this Agreement. All of these remedies shall be cumulative and not exclusive of one another, and the exercise of any one or more of these remedies shall not constitute a waiver or election with respect to any other available remedy. Developer expressly agrees that the City, any City agencies and their respective elected and appointed councils, boards, commissions, officers, agents, employees, volunteers, and representatives (collectively, for the purposes of this Section 6.2, "City") shall not be liable for any monetary damage for a Default by the City or any claims against City arising out of this Agreement. Developer hereby expressly waives any such monetary damages against the City. Any legal action by a Party alleging a Default must be filed within ninety (90) days from date of Declaration of Default after following the procedures in Sections 6.3, 6.4, and 6.5, as applicable.

6.3 Notice and Procedure Regarding Defaults.

6.4 Mutual Agreement for Cure of Certain Defaults.

If the Defaulting Party believes that the Default cannot practically be cured within the thirty (30)-day period (or shorter period as provided in this Agreement), the Defaulting Party is not in Default provided that: (a) the cure is commenced during the applicable period after receipt of the Notice of Default; (b) within the thirty applicable period, the Defaulting Party provides a schedule to the Complaining Party for cure of the Default, subject to the reasonable approval of the Complaining Party; and (c) the cure is completed in accordance with the schedule agreed to by the Parties, or such additional time as agreed by the Complaining Party. If the Parties cannot mutually agree on a schedule for cure of the Default, at the conclusion of the initial thirty (30)-day period 97 -21-
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(or shorter period as provided in this Agreement), the Complaining Party may issue a Declaration of Default and proceed to pursue its remedies under this Article VI.

6.5 Alternative Procedure Regarding Defaults; Annual Review.

6.6 Failure to Assert; No Waiver.

Any failures or delays by a Complaining Party in asserting any of its rights and remedies as to any Default shall not operate as a waiver of any Default or of any such rights or remedies.

Delays by a Complaining Party in asserting any of its rights and remedies, irrespective of the length of the delay, shall not deprive the Complaining Party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert, or enforce any such rights or remedies, nor constitute a waiver of such Party's right to demand strict compliance by such other Party in the future. No waiver by a Party of a Default shall be effective or binding upon such Party unless made in writing by such Party, and no such waiver shall be implied from any omission by a Party to take any action with respect to such Default.

ARTICLE VII

The City Manager shall be authorized to execute any certificate requested by Developer.

Developer and City acknowledge that a certificate hereunder may be relied upon by transferees and Mortgagees.
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ARTICLE VIII

TRANSFERS, ASSIGNMENTS

8.1 Covenants Running with the Land.

8.2 Assignment and Transfer.

Developer and Property Owner shall not have the right to sell, assign, or transfer all or any part of its rights, title, and interests in all or a portion of the Property or Project subject to or a part of this Agreement, to any person, firm, corporation, or entity during the Term of this Agreement without consent of the City. This assignment prohibition applies to the corporate and business entities of Developer that are a Party to this Agreement. Any assignment or transfer prohibited by this Agreement will be considered an immediate breach of this Agreement and City may elect to immediate terminate this Agreement.

ARTICLE IX

MORTGAGEE PROTECTION

9.1 Mortgage Protection.

9.2 Mortgagee Not Obligated.

9.3 Notice of Default to Mortgagee.

9.4 No Supersedure.

Nothing in this Article IX shall be deemed to supersede or release a Mortgagee or modify a Mortgagee's obligations under any subdivision improvement agreement or other obligation incurred with respect to the Property outside this Agreement, nor shall any provision of this Article IX constitute an obligation of City to the Mortgagee, except as to the notice requirements of Section 9.3.

ARTICLE X

INDEMNIFICATION

10.1 No Duty of City; Hold Harmless.

10.2 Indemnification.

10.2, "City") from any and all loss, liability, fines, penalties, forfeitures, costs, and damages (whether in contract, tort, or strict liability, including but not limited to personal injury, death at any time, and property damage) and from any and all third party claims, demands, and actions in law or equity (including attorneys' fees and litigation expenses) directly or indirectly arising or alleged to have arisen out of or in any way related to: (a) the approval of this Agreement or the City Approvals; (b) any development or use of the Property under this Agreement or the City Approvals; and (c) any actions or inactions by the Developer or its contractors, subcontractors, agents, or employees in connection with the construction or improvement of the Property and the Project; excepting to the extent arising from the intentional acts or willful misconduct of City, its elected and appointed representatives, officers, agents, employees, contractors or subcontractors. 100
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This indemnification and hold harmless agreement applies to all damages and claims for damages suffered or alleged to have been suffered by reason of the operations referred to in this Section 10.2, regardless of whether or not City prepared, supplied, or approved plans or specifications for the Property, but does not apply to damages and claims for damages caused by City with respect to public improvements and facilities after City has accepted responsibility for them.

10.3 Joint and Several Liability.

ARTICLE XI

NOTICES

11.1 Notices.

Notices, demands, correspondence and communications between City, Developer, and Property Owner shall be sufficiently given if: (a) personally delivered; (b) dispatched by next day delivery by a reputable carrier such as Federal Express or DHL to the offices of City, Property Owner, and Developer indicated below, provided that a receipt for delivery is provided; or (c) sent by registered or certified mail, or express mail, return receipt requested, with postage prepaid.

City:

City Manager
City of Belmont
One Twin Pines Lane
Belmont, California 94002
With copy to:

City Attorney
City of Belmont
One Twin Pines Lane
Belmont, California 94002
Developer:

Belmont A&E Green Solutions, Inc.
2052 Monroe Ave
Belmont, CA 94002
With a copy to:
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[Address info here, if a copy is to be sent]
Property Owner:

Bechwati Properties LLC
43053 Sabercat Place
Fremont, CA 94539
Any Party may change its mailing address at any time by giving written notice of such change to the other Party in the manner provided herein at least then (10) days prior to the date such change is effective. All notices under this Agreement shall be deemed given and received on the earlier of the date personal delivery is made or on the delivery date or attempted delivery date shown on the return receipt or air bill.

ARTICLE XII

MISCELLANEOUS

12.1 Third-Party Legal Challenge.

12.1.1 Indemnification.

12.1.2 City Cooperation.

The City shall promptly notify the Developer of any Third Party Challenge and shall cooperate fully in the defense of the Third Party Challenge.

12.1.3 Invalidity.

If any part of this Agreement is held by a court of competent jurisdiction to be invalid or unlawful as the result of a Third Party Challenge, the Parties shall use their best efforts to cure any inadequacies or deficiencies identified by the court in a manner consistent with the express and 102
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implied intent of this Agreement, and then to adopt or re-enact such part of this Agreement as necessary or desirable to permit implementation of this Agreement.

12.2 Bankruptcy.

The obligations of this Agreement shall not be dischargeable in bankruptcy.

12.3 Applicable Law/Venue.

12.4 Reimbursement of Development Agreement Costs and Fees.

Developer shall reimburse City for all its reasonable and actual costs, fees, and expenses incurred in drafting, reviewing, revising, and processing this Agreement, including, but not limited to, recording fees, ordinance publication fees, staff time in preparing staff reports, and staff time, including legal counsel and special counsel fees, for preparation and review of this Agreement and changes requested by Developer.

12.5 Further Assurances.

12.6 Severability.

12.7 Nondiscrimination.

12.8 Developer Right to Rebuild.
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City agrees that Developer may renovate or rebuild a development located on the Property within the Term of this Agreement should it become necessary due to natural disaster, including but not limited to fire, flood, or earthquake. Any such renovation or rebuilding shall comply with the Applicable Law and this Agreement.

12.9 Headings.

Section headings in this Agreement are for convenience only and are not intended to be used in interpreting or construing the terms, covenants, or conditions of this Agreement.

12.10 Agreement is Entire Understanding.

This Agreement is executed in one original, which constitutes the entire understanding and agreement of the Parties with respect to the subject matter hereof. Except as otherwise specified in this Agreement, any prior correspondence, memoranda, agreements, warranties, or representations are superseded in total by this Agreement.

12.11 Interpretation.

Each Party to this Agreement has had an opportunity to review the Agreement, confer with legal counsel regarding the meaning of the Agreement, and negotiate revisions to the Agreement.

Accordingly, neither Party shall rely upon Civil Code Section 1654 in order to interpret any uncertainty in the meaning of the Agreement.

12.12 Recordation of Termination.

12.13 Signature Pages; Execution in Counterparts.

For convenience, the signatures of the Parties to this Agreement may be executed and acknowledged on separate pages in counterparts which, when attached to this Agreement, shall constitute this as one complete Agreement.
[Signatures on the Following Page]
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IN WITNESS HEREOF, the Parties have executed this Agreement as of the Effective Date.

CITY OF BELMONT,
a municipal corporation
By: ____________________________
Afshin Oskoui, City Manager
Dated: ____________________________
Belmont A&E Green Solutions, Inc.
a California Corporation
By: ____________________________
By: ____________________________
Dated: ____________________________
ATTEST:

By: ____________________________
Jozi Plut, City Clerk
Dated: ____________________________
Bechwati Properties LLC,
a California Limited Liability Company
By: ____________________________
By: ____________________________
Dated: ____________________________
APPROVED AS TO FORM:

By: ____________________________
Scott Rennie, City Attorney
Dated: ____________________________
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I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature (Seal)
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I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature (Seal)
107

EXHIBIT A
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EXHIBIT A

LEGAL DESCRIPTION OF THE PROPERTY
Portion of Lot 2, as designated on the Map entitled, “Bay View Heights Subdivision No. 3, San Mateo County, California”, which map was filed in the office of the County Recorder of San Mateo County, State of California on September 24, 1927 in Book 16 of Maps, at Page 35, more particularly described as follows:

Beginning at a point on the Northeasterly line of said Lot, distant thereon South 43° 56’ East 554.65 feet from its intersection with the Southeasterly line of O’Neill Avenue as shown on the aforementioned map, said point of beginning being the Southeasterly corner of lands conveyed by Norman F. Meyer and Ann E. Meyer to Mae R. Mather by deed dated August 6, 1953 and recorded August 13, 1953, in Volume 2459 of Official Records at Page 63; thence South 43° 56’ East 4.97 feet; thence South 44° 26’ East 101.52 feet; thence South 45° 26’ East 48.16 feet, more or less to its intersection with the Northerly line of lands described as Parcel One in the deed from California Pacific Title & Trust Company, a corporation, to the State of California, dated June 2, 1930, and recorded June 10, 1930 in Book 477 of Official Records of San Mateo County at Page 268, thence Westerly and Northwesterly along the boundary of land described in said deed, on an arc of curve to the right, from a tangent which bears South 89° 30’ West and with a radius of 50 feet; through a central angle of 46° 28’ an arc distance of 40.55 feet to a point on a line parallel with and 50 feet Northeasterly from the center line survey of the State Highway; thence North 44° 02’ West, along said parallel line 117.09 feet to a point, which point is the most Southerly point of lands conveyed by Norman F. Meyer and Ann E. Meyer to Mae R. Mather by deed dated August 6, 1953, and recorded August 13, 1953, in Volume 2459 of Official Records at Page 63; thence North 42° 30’ East parallel with the Southeasterly line of O’Neill Avenue, to the point of beginning.

APN: 045-243-040
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EXHIBIT B
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EXHIBIT B

ANNUAL REVIEW FORM
This Annual Review Form is submitted to the City of Belmont ("City") by __________________________________________ ("Developer") pursuant to the requirements of California Government Code Section 65865.1 and Section 28 of the Belmont City Code regarding Owner's good faith compliance with its obligations under the Development Agreement between the City and Developer having an Effective Date of ________________, 20__ ("Development Agreement"). All terms not otherwise defined herein shall have the meanings assigned to them in the Development Agreement:

Annual Review Period: ______________ to ______________.

Describe any extension as a result of enforced delay under Section 2.6 of the Development Agreement. Provide copies of any notices provided to the City under Section 2.6.

IN WITNESS WHEREOF, DEVELOPER has executed this Annual Review Form as of this _______ day of ______________, 20__.

DEVELOPER:
________________________,
a ___________________________
By: ______________________________
Name: ______________________________
Title: ______________________________
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RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BELMONT APPROVING A

CONDITIONAL USE PERMIT AND DESIGN REVIEW FOR THE CANNA-BEL RETAIL CANNABIS DISPENSARY BUSINESS AT 1397 EL CAMINO REAL & APN 045-243-050 WHEREAS, Bechwati Properties, LCC (“Property Owner)”, is the fee owner of the real property located at 1397 El Camino Real within the City of Belmont (the “Property”); and, WHEREAS, Belmont A & E Green Solutions, Inc., a California corporation (dba Canna-Bel) (“Developer”) has a leasehold interest in the Property and proposes to develop the Property for a cannabis retail use; and,
WHEREAS, the City received an application from Property Owner and Developer to establish a retail cannabis use on Property and seeking approval of an amendment to the Zoning Basemap Designation for the Property incorporating it into the S-3 Cannabis Retail and Distribution Overlay District, as well as Conditional Use Permit, Design Review, and Development Agreement entitlements (the “Project”); and,
WHEREAS, on March 4, 2025, the Planning Commission held a duly noticed public hearing to consider public testimony and a staff report for the Rezoning and Development Agreement requests, and rendered a recommendation as to whether the City Council should rezone the Properties as requested and approve the development agreement for the Canna-Bel Business; and, WHEREAS, on March 11, 2025, the Zoning Administrator held a duly noticed public hearing to consider public testimony and a staff report for the proposed Conditional Use Permit and Design Review for the Canna-Bel Retail Cannabis Dispensary Business for the subject properties; and, WHEREAS, on the March 25, 2025, the City Council held a duly noticed public hearing to take testimony from the public and the applicant, to consider the Planning Commission and Zoning Administrator recommendations, and to receive a staff report and information about the Project, and at the conclusion of the hearing introduced an ordinance rezoning 1397 El Camino Real & APN 045-243-050 into the S-3 Cannabis Overlay District, introduced an ordinance approving a development agreement for the project, and directed staff to place a resolution approving a Conditional Use Permit and Design Review for the project on the April 8, 2025 City Council agenda; and,
WHEREAS, on April 8, 2025, the Council at a duly noticed regular meeting the Rezoning and Development Agreement Ordinances, and Conditional Use Permit & Design Review Resolutions were presented for adoption by Council in accordance with state law; and, WHEREAS, Council previously certified a Final Environmental Impact Report (FEIR) that evaluated the environmental impacts of the City’s 2035 General Plan, Phase I Zoning, Belmont Village Specific Plan (BVSP), and Climate Action Plan (CAP) on October 24, 2017 (the “General Plan EIR” – SCH #2016082075), making required findings under the California Environmental Quality Act (CEQA), adopting a Mitigation Monitoring and Reporting Program (MMRP), and a statement of overriding consideration for that project on November 14, 2017; and, WHEREAS, the City subsequently prepared an addendum examining the environmental effects of amending General Plan Land Use Element Section 2.4 and Policy 2.6-7, and establishing the S-3 Overlay District to allow up to two cannabisretail uses and one cannabis distribution use and found 110

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NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BELMONT DOES RESOLVE AS FOLLOWS:

SECTION 1. CONDITIONAL USE PERMIT AND DESIGN REVIEW FINDINGS

The proposed Canna-Bel Retail Cannabis Business use would be located in the Belmont Village area, in proximity to main city arterials and mass public transportation options (bus and rail).

The project site is currently developed with a restaurant building that is currently served by all required utilities. An interior and exterior remodel of the building is proposed to accommodate the proposed Cannabis Retail Business. No upgrades or extension of transportation or utility facilities would be required for the project. Representatives from the City’s Police Department and Fire District have not identified any service concerns for the project.

A site circulation evaluation has been conducted by city staff. The project will refurbish and stripe an existing parking lot (currently owned by Caltrain and under lease agreement for use by the Canna-Bel business. Parking for staff will be addressed within this parking lot.

Conditions of approval are required to address any gate closure/access, parking, or safety impacts from the project.

Based on the foregoing, the location of the proposed project would not place an undue burden on parking, traffic circulation, or utilities serving the neighborhood, and would be compatible with surrounding uses in the established (November 2023) S-3 Cannabis Retail/Distribution Overlay District along south El Camino Real. This Finding is affirmed. (2) The site is of sufficient size to accommodate the proposed use together with all yards, open spaces, walls and fences, parking and loading facilities, landscaping and such other provisions required by this Ordinance.

No expansion of the existing building is proposed; a remodel of the existing restaurant to a Retail Cannabis Business use is proposed. Compliant accessible parking would be provided, and the project would meet its parking requirement (1 space for each 250 square feet of space) for retail commercial uses in the BZO; the proposed parking lot/restriping modifications for site will result in 13 spaces for the property. Building lighting would be upgraded to meet current 111

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city standards. Thus, the project site is of sufficient size to accommodate the proposed use. This Finding is affirmed.
(3) The site will be served by streets of capacity sufficient to carry the traffic generated by the proposed use.

El Camino Real and Harbor Boulevard, which intersect at the proposed Canna-Bel Retail Cannabis Business property at 1397 El Camino Real, have sufficient capacity to carry the traffic generated by the proposed use. This Finding is affirmed. (4) The proposed use, if it complies with all conditions upon which approval is made contingent, will not adversely affect other property in the vicinity or the general welfare of the City.

All relevant City departments have reviewed the proposal and/or provided conditions of approval that should ensure that the proposed use will not adversely affect the general welfare of the City. Conditions of approval have been included that would require conformance with the California Building Code. The Canna-Bel Retail Cannabis Business is also required to comply with all Chapter 13 Belmont City Code Statutes and Regulations for Safety, Registration, and Operation. In particular, as per City Code Section 13-53, the Retail Cannabis Business shall obtain a Business Registration Certificate (i.e. Police Permit) prior to operation.

Therefore, as proposed and with incorporation of and adherence to the conditions of approval, this Finding is affirmed.

BZO Section Findings 21.4.1(b)(3. A-E)
(A) The establishment of the proposed use complies with the applicable development regulations.

The proposed Canna-Bel Retail Cannabis Business has been evaluated in conjunction with the adopted BZO Section 21.4.1(c) Development Regulations. The proposed project either already complies with these established regulations or has been conditioned to comply. This Finding is affirmed.
(B) For a Cannabis Retail Use Permit, there are no more than two lawfully approved Cannabis Retail uses and approval of the use permit will not result in more than two Cannabis Retail uses in the S-3 District.

There is one other Retail Cannabis Business proposed within the established (November 2023) S-3 south El Camino Real Retail/Distribution Cannabis Overlay District. Approval of the Canna-Bel Retail Cannabis Business Use will not result in more than two Cannabis Retail Uses in the S-3 District. This Finding is affirmed.
(C) For a Cannabis Distribution Use Permit, there is no more than one lawfully approved Cannabis Distribution use and approval of the use permit will not result in more than one Cannabis Distribution use in the S-3 District.

The proposed Cannabis Business at 1397 El Camino Real is retail based. No Cannabis Distribution Uses are currently proposed in the established S-3 District. This Finding is affirmed.
(D)The use permit conditions require the use to comply with the performance standards in subsection (d) unless a modification is expressly approved by the permit. 112

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The project (a proposed Retail Cannabis Business at 1397 El Camino Real) currently complies with or is conditioned to comply with the adopted (November 2023) BZO Section 21.4.1(d) Performance Standards. This Finding is affirmed.
(E) The Police Department has reviewed and approved security and operations plans for the use at the proposed facility.

The Police Department (PD) has completed a preliminary review of the proposed Canna-Bel security/operational plans. The Canna-Bel Business application was also preliminarily checked and cleared by the Police Department (PD). Their operational and security plans were evaluated by the PD to ensure these plans meet all of the requirements described in the city ordinance.

The Canna-Bel Security and Operational Plans have been conditionally approved. Final review, completion, and approval of the Canna-Bel Retail Cannabis Business Security/Operational plans will be required prior to obtaining a Business Registration Certificate (i.e. Police Permit) prior to an operation start for the business. A Condition of Approval has been included regarding compliance with these requirements. This Finding is affirmed.

3. Under Belmont Zoning Ordinance (BZO) Section 13.2.1(b), design review is required for exterior alterations of structures in the VCMU District. “Exterior Alteration” includes replacing elements such as windows or doors and repainting or refinishing with design, elements, materials or colors different than previously approved. As such, Design Review is required for this project in accordance with the Findings enumerated in BZO Section 13.5.2 (a-d) – see below:
(a) City staff and consultants have provided technical review and conditions of approval are included, as applicable, regarding project-related traffic, parking, grading, drainage, storm-water runoff, sanitary sewer impacts, vehicular and pedestrian access, site circulation, site stability, structural encroachments, and construction impacts.

City staff and consultants have completed the appropriate technical review for the project. No upgrades or extension of transportation or utility facilities would be required for the project.

The subject property provides both adequate and required parking for the business. No grading, drainage, sanitary sewer, vehicular/pedestrian, or construction impacts are anticipated. As part of the project review process, the City’s Department of Public Works, Fire Department, Police Department, and Community Development Department (Planning and Building Divisions) have compiled a list of project-specific conditions of approval which would be required during construction.

All construction will be completed in compliance with the California Building Code and the National Pollutant Discharge Elimination System (NPDES) standards as administered by the City of Belmont. A site circulation evaluation has also been conducted and approved by city staff.

Representatives from the City’s Police Department and Fire District have not identified any service concerns for the project. This finding is affirmed. (b) The project is consistent with the landscape standards under Sections 13.3.1 as applicable.

New landscaping for both the south Harbor Boulevard frontage, and northern property frontage is included in the Canna-Bel proposal. The proposed landscaping will consist of a combination of new tree, shrub, and groundcover plantings. All plantings will be irrigated with a complete underground irrigation system in conjunction with City requirements. Proposed landscape 113

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design features will occupy at least 10% of the gross site area. The project will incorporate all required Water Efficient Landscape Ordinance (WELO) measures as required by the City and the Mid-Peninsula Water District (MPWD). This finding is affirmed. (c) The project is consistent with the development standards in the underlying zoning district.

The project is consistent and compliant with all BZO development standards for the VCMU District. The project has also been conditioned to comply with all Development Regulations and Performance Standards established for Cannabis Uses. This finding is affirmed. (d) The project is consistent with the objective design standards in Section 13.6 as applicable.

The project includes minor interior building improvements (to the current Sumac Restaurant building) that will consist of new interior building partition walls, lighting, and a new HVAC system and ADA accessible bathroom. Exterior building painting (beige/brown brick face color) enhancements are also proposed as well as a new black wrought-iron fencing/gate with security enhancements. An existing patio along the El Camino Real frontage will be removed.

The project also includes restriping enhancements to the rear (eastern) parking lot that will serve the Cannabis Retail business.

The new signage will consist of a combination of “Canna-Bel” individual letter and logo elements in a gold color. The new signage is proposed to be installed within the entry gate and repainted exterior front façade of the building. The new signage will be viewable from the El Camino Real property frontage. The proposed improvements do not include the use of extreme colors.

The project lighting plans were evaluated by the Police Department to ensure these plans met all of the requirements described in the city ordinance. The lighting is designed to not cause spillover, glare, or trespass onto adjacent properties. This finding is affirmed.

The proposed project is in compliance with BZO Section 13.2.1 requirements applicable to exterior alterations; the applicable findings in BZO Section 13.5.2 (a-d) can be made in the affirmative. Based on the foregoing analysis, the City Council approves of the project Design Review for the Canna-Bel Retail Cannabis Business for the subject property (1397 El Camino Real & APN 045-243-050).

SECTION 2. DEVELOPMENT REGULATIONS AND PERFORMANCE STANDARDS As per Belmont Zoning Ordinance (BZO) Section 21.4.1(c) & (d), and in conjunction with the Conditional Use Permit for the proposed Canna-Bel Retail Cannabis Business, an assessment on the consistency and compliance with the adopted (November 2023) Cannabis Use Development Regulations and Performance Standards is required. Below is an analysis of those BZO regulations and standards.

BZO Section 21.4.1(c) - Development Regulations
(1) The use may only be established and operate inside a completely enclosed building.

The proposed Canna-Bel Retail Cannabis Business is designed, required, and conditioned to operate completely within the building. This regulation has been met. (2) The location of a Cannabis Retail or Cannabis Distribution use when initially established must comply with the following:
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(A) The use must be at least 600 feet from a school or other Cannabis Retail or Cannabis Distribution use and at least 100 feet from parks and actively operated child day care centers.

The proposed Canna-Bel Retail Cannabis Business (at 1397 El Camino Real & APN 045-243- 050) is located further than 600 feet from any school or other proposed Cannabis Retail Business (NUG at 1538 El Camino Real). The Canna-Bel Business is also located further than 100 feet from any park or actively operated child day care center. This regulation has been met.
(B) The distances in subparagraph (A) are measured from the building containing the Cannabis Retail or Cannabis Distribution use by the length of the shortest path of travel over which the general public has a right to travel to the boundary of a property containing the incompatible use.

Appropriate business distance analysis has been completed in accordance with this regulation.

The Canna-Bel Business is in compliance with this regulation. (C) The public entrance to the Cannabis Retail or Cannabis Distribution use may not be located immediately adjacent to a youth-oriented business on the same frontage as the entrance.

The proposed Canna-Bel Retail Cannabis Business is not located adjacent to or near a youthoriented business. This regulation has been met. (3) The site and building must be suitably designed to be secure.

The Canna-Bel Business application was preliminarily checked and cleared by the Police Department (PD). Their security plan was evaluated by the PD to ensure the plan met all of the requirements described in the city ordinance. The Canna-Bel Security Plan has been conditionally approved, pending a compliance check when the installation and construction has been completed for the building/property. A Condition of Approval is included requiring compliance with this development regulation.

BZO Section 21.4.1(d) - Performance Standards
(1) State Licensing. The use must fully comply with all applicable operational rules and regulations governing commercial cannabis activity in Business & Professions Code Division 10.

The Canna-Bel Retail Cannabis Business will only be allowed to be open during the aforementioned operating hours. A condition of approval is included requiring compliance with this performance standard.
(3) Consumption. Consumption of cannabis on the premise must not be allowed.

A condition of approval is included requiring compliance with this performance standard. 115

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(4) Smoking. Smoking or vaping of any kind on premises must not be allowed.

The new HVAC system for the proposed Canna-Bel Retail Cannabis Business building will replace the existing system and be in full compliance with California Building Codes as well as the Rules and Regulations of the California Department of Cannabis. As such, there is not an expectation of cannabis odor emanating from the (remodeled) building. In addition, no cannabis will be permitted to be consumed in or around the premises by smoking or vaping. A condition of approval is included requiring compliance with this performance standard. (6) Public services. Operation of the business must not place a burden on the provision of public services disproportionate to other retail uses.

The Police Department (PD) has completed a preliminary review of the proposed NUG operational/safety/security plan. Final review, completion, and approval of the aforementioned Canna-Bel Retail Cannabis Business plans will be required prior to obtaining a Business Registration Certificate (i.e. Police Permit) prior to an operation start for the business. The proposed retail cannabis business is not expected to create a disproportionate public service burden in comparison to other commercial retail uses within the community. A condition of approval is included requiring compliance with this performance standard. (7) Exterior Security Lighting. Adequate external lighting must be provided for security purposes. The lighting shall be sufficient to provide illumination and clear visibility to all outdoor areas, with minimal spillover on adjacent properties. The lighting must be stationary, directed away from adjacent properties and public rights-of-way, and compatible with the neighborhood.

The Canna-Bel Business application was preliminarily checked and cleared by the Police Department (PD).Both theirsecurity and lighting plans were evaluated by the PD to ensure these plans met all of the requirements described in the city ordinance. The Canna-Bel Security & Lighting Plans have been conditionally approved, pending a compliance check when the installation and construction has been completed for the building/property. A Condition of Approval is required regarding compliance with this performance standard. (8) Security. On-site security must be provided for Cannabis Retail or Cannabis Distribution uses during the hours of operation when clients are present.

The Canna-Bel Security Plan was preliminarily checked and has been conditionally approved by the Police Department (PD), pending a compliance check when the installation and construction has been completed for the building/property. Their security plan was evaluated by the PD to ensure the plan meets all of the requirements described in the city ordinance. A Condition of Approval is required regarding compliance with this performance standard. (9) Commercial Cannabis Permit. The use must fully comply with all applicable local permit rules and regulations governing commercial cannabis activity, including operational permit requirements and conditions and approved operational plans under any other city ordinance or code.

The Canna-Bel Retail Cannabis Business is required to comply with all Chapter 13 Belmont City Code Statutes and Regulations for Safety, Registration, and Operation. In particular, as 116

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per City Code Section 13-53, the Retail Cannabis Business shall obtain a Business Registration Certificate (i.e. Police Permit) prior to operation. A condition of approval is included requiring compliance with this performance standard.
(10) In the event of a conflict between the requirements of the use permit and the requirements of a local operations permit issued by the police department, the more restrictive performance requirements apply.

The Police Department (PD) review has centered on the operational/safety plan, security plan, and state licensing to ensure that this use will operate in accordance with all applicable laws (i.e., use of products on site or in public places would be prohibited, security personnel would be required to prevent sales to minors and loitering, cannabis products and graphics representing cannabis products may not be visible from the exterior of the facility, and products must be stored and sold from inside the building. Final review and completion of the operational/safety/security plan for the Canna-Bel Retail Cannabis Business will be required prior to obtaining a Business Registration Certificate (i.e. Police Permit) prior to an operation start for the business.

As proposed and to be conditioned, no noise, lighting, parking, traffic or circulation impacts are anticipated from the project. All relevant City departments have reviewed the proposal and have provided conditions of approval that should ensure that the proposed use will not adversely affect the general welfare of the City. A condition of approval is included requiring compliance with this performance standard.

SECTION 3. CONDITIONAL USE PERMIT AND DESIGN REVIEW APPROVAL Based upon the findings of fact contained in the staff report to the City Council dated March 25, 2025, the presentations to the Council and supporting documents and any public testimony received, and in accordance with Belmont Zoning Ordinance Sections 10.7.3(a), 21.4.1(b)(3), and 13.5.2(a-d), the City Council approves the Conditional Use Permit and Design Review for the Canna-Bel Retail Cannabis Dispensary Business at 1397 El Camino Real & APN 045-243- 050 subject to the Project Conditions of Approval in Exhibit A to this Resolution.

SECTION 4. EFFECTIVE DATE.

Ayes:

Noes:

Absent:

Abstain:

ATTEST:

City Clerk Mayor
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Conditions of Approval – Exhibit A
April 8, 2025 City Council
Conditional Use Permit and Design Review
Canna-Bel Cannabis Dispensary Business
1397 El Camino Real & APN 045-243-050
Planning Application PA2024-0027
Community Development Department

Thisindemnification and hold harmless agreement appliesto all damages and claimsfor damages suffered or alleged to have been suffered by reason of the operations referred to in this condition, regardless of whether or not City prepared, supplied, or approved plans or specifications for the Property, but does not apply to damages and claims for damages caused by City with respect to public improvements and facilities after City has accepted maintenance responsibility for them.

4. NPDES Stormwater Controls (General) - The owner/applicant shall ensure that all construction personnel follow standard BMPs for stormwater quality protection during construction of project. These include, but are not limited to, the following:
a. Store, handle and dispose of construction materials and wastes properly, so as to prevent their contact with stormwater.
b. Control and prevent the discharge of all potential pollutants, including solid wastes, paints, concrete, petroleum products, chemicals, washwater or sediment, and non-stormwater discharges to storm drains and watercourses.
c. Use sediment controls, filtration, or settling to remove sediment from dewatering effluent. 118

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d. Do not clean, fuel, or maintain vehicles on-site, except in a designated area in which runoff is contained and treated.
e. Delineate clearing limits, easements, setbacks, sensitive or critical areas, buffer zones, trees, and drainage courses with field markers or fencing.
f. Protect adjacent properties and undisturbed areas from construction impacts using vegetative buffer strips, sediment barriers or filters, dikes, mulching or other measures as appropriate. g. Perform clearing and earth moving activities only during dry weather (April 15 through November 14).
h. Limit and time applications of pesticides and fertilizers to prevent polluted runoff. i. Limit construction access routes and stabilize designated access points. j. Do not track dirt or other materials off-site; clean off-site paved areas and sidewalks using dry sweeping methods.

5. Comply with all established Cannabis Use Development Regulations as per Belmont Zoning Ordinance (BZO) Section 21.4.1(c).

7. Comply with all executed terms for the Canna-Bel Cannabis Dispensary Business Development Agreement (DA).

8. If any existing landscaping should be damaged during construction related activities, the applicant shall replace such landscaping, including consideration to utilize drought-tolerant plantings, prior to issuance of a planning final. Prior to building permit issuance, the applicant shall provide photographs of the property to document existing landscape conditions.

9. Tree Protection. The applicant shall implement the Tree Protection Guidelines identified in the Arborist Report, prepared for the project; the project arborist shall review the final building and grading plans, and confirm in writing any changes to the design recommendations. The guidelines shall be included on a plan sheet submitted with the building permit application.

10. Prior to issuance of a grading or building permit, the applicant shall submit written confirmation from the Project Arborist that all tree protection measures, and pre-construction treatments have been installed and inspected, and that they meet the arborist’s specifications.

11. Any approved grading, construction, demolition or other work within the tree protection zone shall be monitored by the project arborist.

12. Tree protection devices are to remain until all site work has been completed within the work area. Fences or other protection devices may not be relocated or removed without permission of the Project Arborist.

13. If unplanned or unapproved tree injuries or tree removals occur during project construction, the applicant shall contact City Planning Staff. Additional permits may be required.

14. After completion of exterior construction work and before final building permit inspection, the applicant shall submit a final written report/letter from the Project Arborist. Said report/letter 119

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shall provide an evaluation of the construction impacts to the subject tree’s health or structural stability, and shall identify any additional provisions that may be required to these address impacts. The applicant shall be responsible to implement these recommendations. A final report may be required on the effectiveness of the measures.

15. Prior to the issuance of Building Permits for the project, the applicant shall submit a revised Landscaping Plan that is subject to the review and approval by the Community Development Department. The landscape plan shall include the following selected species choices for trees, shrubs, and groundcovers as outlined below:

Trees: Cercis occidentalis (common name – Western Redbud); Platanus acerifolia 'Columbia' (common name – London Plane Tree); Tristania conferta (common name – Brisbane Box).

Shrubs: Lomandra 'Platinum Beauty' (common name - Variegated Dwarf Matt Bush); Olea europaea 'Montra' (common name – Little Olie Dwarf Olive); Westringia fruticosa ' Smokey' (common name - Smokey Coast Rosemary).

Groundcovers: Ceanothus hearstiorum (common name - Hearst's Ceanothus); Myoperum parvifolium (common name - Creeping Myoperum).

Public Works Department

16. Pursuant the City’s zoning regulations and Public Works/Engineering requirements, the applicant shall provide an accurate and recorded copy of the Record of Survey (ROS), to confirm boundaries, setbacks, existing structures, monuments and easements prior to issuance of a building permit.

17. The Applicant shall submit a copy of the parking lot lease agreement with Caltrain (the owner of eastern parking lot that would serve the Canna-Bel Retail Cannabis Business), to the Public Works Department (PWD) for review and verification prior to the issuance of the building permit. The Agreement shall contain a legal clause requiring the applicant to report to the PWD and City Manager’s Office, if the lease is vacated or cancelled. Any action or violation that would result in the vacation or cancellation of the parking lot lease will subject the Canna-Bel Business Operator to revocation of the Conditional Use Permit, Development Agreement, and additional requirements to meet the City’s determined needs for continual operation of parking for the Retail Cannabis Business.

18. A portion of the proposed work is within the State of California right-of-way. The applicant shall contact the California Department of Transportation (Caltrans) to obtain an encroachment permit for this portion of the work.

19. The entry gate shall allow room for one (1) car length to be able to park at the gate entrance and operate it without obstructing vehicles or pedestrian path of travel within the Caltrans right-ofway, or the gate is required to be automatic.

20. Any increases in sewer demand and upsizing of existing water services for proposed tenant improvements will require sewer lateral improvements. Confirm that there will be no additional fixture units for the project.

Police Department

21. The Cannabis Retail Business (Canna-Bel) shall comply with all Chapter 13 Belmont City Code Statutes and Regulations for Safety, Registration, and Operation. In particular, as per City Code 120

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Section 13-53, the Retail Cannabis Business shall obtain a Business Registration Certificate (i.e.

Police Permit) prior to operation.

22. All activities shall be subject to the requirements of the Belmont Noise Ordinance.

23. No debris boxes or building materials shall be stored on the street unless permitted.

24. No parking of construction/employee vehicles shall be allowed in the roadway.

25. Any lane/road closures must only be conducted during non-commute hours (9am-3pm).

26. No Trespassing signs, as per California Penal Code (PC) Section 602, are required to be posted around the property to discourage unauthorized entry and aid in criminal prosecutions for trespassing/theft.

27. The property address must be clearly posted at all times during and after construction, visible and legible from entire roadway frontage(s).

Building Division

28. Specify that the 2022 California Code of Regulations as amended by the State of California and all applicable City of Belmont ordinances will be employed during this project.

29. A minimum of 65% of the construction waste generated by this project shall be recycled or salvaged for use. Documentation shall be provided before the final inspection. Sample forms found in A Guide to the California Green Building Standards Code (Residential) located at www.hcd.ca.gov/CALGreen.html may be used to assist in documenting compliance. CALGreen Section 4.408.

30. All construction and related activities (not including grading) may only be conducted during the hours of 8:00 a.m. to 5:00 p.m., Monday through Friday and 10:00 a.m. to 5:00 p.m., Saturdays.

Grading may occur between the hours of 8:00 a.m. and 5:00 p.m. Monday through Friday. No construction activity (including grading) or related activities shall be allowed outside of the aforementioned hours or on Sundays and the following holidays: New Years Day, Presidents Day, Memorial Day, 4th of July, Labor Day, Thanksgiving Day and Christmas Day. All gasoline powered construction equipment shall be equipped with an operating muffler or baffling system as originally provided by the manufacturer, and no modification to these systems is permitted.

31. The applicant shall obtain all department final signatures prior requesting a Building Permit final.

32. Provide on the plans the existing and proposed locations of the electric and gas meters, subpanels, water heater and furnace.

33. The applicant shall post hours of operation and phone numbers for noise complaints.

34. The project building/site permits valuation shall determine the amount of accessibility provisions required.

Fire Department

35. The proposed gate will require a Knox-keyed switch to access the building during an emergency. 121

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Belmont City CouncilApril 8, 2025

Belmont City Council
April 8, 2025