NEWTON, MASSACHUSETTS AND GARDEN REMEDIES, INC. HOST COMMUNITY AGREEMENT am THIS HOST COMMUNITY AGREEMENT ("AGREEMENT") is entered into as ofthis IZ” day of April, 2018 by and between Garden Remedies, In. (“Garden Remedies”), Massachusetts not-for-profit comporation with a principal office adres of 697 Weshinglon Stet, Newton, Massachusets 02458 “the Company") andthe City of Newton, a Massachusets municipal corporation witha principal addres of 1000 Commonwealth Aven, Newton Centre, Massachusetts 02459 (“th City”, ating by and through its Mayor. WHEREAS, the Company seeks to locate # Marijuana Establishment (*ME"), as defined in and subject tothe provisions of M.G.L, Chapter 94G and Chapter 55 of the Acts of 2017, in the City, in accordance with regulations issued by the Massachusetts Cannabis Control Commission (“CCC”) at 935 CMR 500.000 et seq.; and WHEREAS, the Company intends to provide certain benefits to the City in the event that it receives a Final License from the CCC to operate a ME (the “CCC License”), and receives all ‘other required local permits and approvals; and WHEREAS, the parties agree thatthe terms, conditions, and funds required herein are reasonable and directly proportional tothe costs of addressing the potential health, safety, and ‘other effeets or impacts ofthe ME on the City. NOW THEREFORE, in consideration ofthe provisions ofthis Agreement, the Company and the City agree as follows: 1, ‘The Company agrees to make payments tothe City, in the amounts and under the terms provided herein (the “Funds”). The Treasurer ofthe ity shall hold the funds fr the ‘purposes of addressing the public health, safety, education, administrative infrastructure and ‘other effects or impacts as may be identified ofthe Medical Establishment onthe City and on its municipal and schoo programs, services, personnel, and facilites. The Funds shall be used at iy’s sole discretion, and the City will rack expenditures on an annual basis. 2, The Company shall pay to the City the following sums: (@) 3% of the Company's gross revenues from the sale of Medical Marijuana caleulated retroactive to March 5, 2018. (6) 3% ofthe Company’s gross revenues from the sale of Adult-Use (ie. Recreational) Marijuana calculated as ofthe first dae of retail sales Payments made pursuant to this provision shall be made on a quarterly basis and shall represent 3% gross revenues from relevant sales made inthe preceding quarter. The (quarters are to be defined as follows ~ Quarter I is January | through March 31, Quarter 2 isApril 1 through June 30, Quarter 3 is July 1 through September 30, and Quarter 4 is October 1 through December 31. Payments to the City representing a percentage of gross revenues received by the Company during a given quarter shall be made on or before the lst day of the next month. (As an example, the payment due for sales occurring during Quarter 1 shall be made on or before the last day ofthe first month of Quarter 2, ic, April 30.)The Company shall provide the City with copies ofits periodic financial filing o the COC documenting sles, and also a copy ofits annual fling as a non-profit if any, tothe Massachusetts Office of the Attorney General 3, ‘this Agreement shall take effect as ofthe date frst writen above an shall ran for an initial term of five (5) years with any changes to be approved in writing by both partes. ‘The parties agree to begin negotiation fora successor agreement six months in advance ofthe fifth aniversary ofthe Agreement’s execution 4. ‘The purpose ofthe payments by the Company is to assist the City in addressing any public health, safety, education, administrative, infrastructure and other effects or impacts as tay be identified ofthe Medical Establishment on the City and on its municipal and school programs, services, personnel and facilities. The City may expend the above-eferenced payments for these purposes a its sole and absolute dseretion, 5, The provisions of this Agreement shall be applicable as long asthe Company ‘operates a ME in the City pursuant ta license issued by the CCC. 6. The Company, in addition to any Funds specified herein, shall contribute to public hates or private non-profit entities in the City an amount not les than $2,500.00 inthe first year ofthis Agreement.and shall escalate five percent (59%) annually theveafter. Said charities ‘hall be determined by the Company in is reasonable discretion, 7. The Company will make best efforts to hire qualified employees who are City residents, 8, The Company shall notify the City of the name and relevant information, including but not limited to the information set forth in 95 CMR 500.802, ofthe person proposed toact as on-site manager ofthe ME. The submitted information shall include the results of a ‘criminal history (CORI) check on the person proposed to act as on-site manager of the Facility, ‘verifying that the individual i of suitable character to act as on-site manager. This notification process shall also apply to any change of on-site manager. 9. The Company shall provide the City with certification anda written summary of the training which shall be provided to the on-site manager and to all agenis of the ME. The ‘Company shall further provide the City with a copy of ts policy (as equired pursuant to 95, ‘EMR 500.105(1}(0}\a) and (b) forthe immediate dismissal of any dispensary agent who has (a) diverted marijuana, which shall be eported to law enforcement officials and to the CCC or (b)engaged in unsefe practices with regard tothe operation of the ME, which shall be reported to the CCC, 10. ‘The Company shall work with the Newton Police Department to implement a ‘comprehensive diversion prevention plan to prevent diversion, such plan tobe in place prior to the sales commencement date. Such plan will includ, but is not limited to (a) taining ME ‘employees to be aware of, observe, and report any unusual behavior in customers, or other ME ‘employees that may indicate the potential for diversion; (b) strictly adhering to maximum sale ‘quantities an time periods for purchases (per COC and DPH guidelines); (in the case of ‘medical patients, rigorous patient identification and verification procedures through the MMI Online System; () utilizing seed-to-sale tracking software to track closely all inventory atthe ME; (refusing to complete a transaction if the customer () requests additional marijuana product because a prior purchase was damaged or lost; (i threatens or ates to coerce an ME ‘employee in order to obiain excess marijuana product; or (i) attempts to elicit guilt or sympathy from an ME employee in order to oblain excess marijuana product. 11. ‘The Company shall maintain its books, financial records, and any other data related to its finances and operation in accordance with standard accounting practices and any applicable regulations and guidelines promulgated by the Commonwealth, All records shall be reiainod fora period of atleast seven (7) years. The City shall have the right to enter and uit ‘or inspeet said records upon reasonable notice to Company, provided, however, that suid records shall not become a public record by virtue ofthe autor inspection. 12, ‘The Company shall schedule an annual meeting every June withthe Mayor, or his ‘or her designee, to review the previous year’s operations inthe City. 13, ACall times during the Term ofthis agreement, property, both real and personal, ‘owned or operated by the Company shall be treated as taxable, and all applicable real estate and personal property taxes for that property shall be pad either directly by the Company or by its lessor, andthe Company shall not object to or otherwise challenge the taxability of such property and shall not seek @ non-profit exemption from paying such taxes. Notwithstanding the foregoing, () if real or personal property owned or operated by the Company is determined to be ‘non-taxable or partially nontaxable, «determination of which the Company agrees not to seck at ‘any time during this Agreement, or (i ifthe Company is determined to be entitled or subject to ‘exemption with the effect of reducing or eliminating the tax which would otherwise be due if not #0 exempted, then the Company shall pay tothe City an amount which when added tothe taxes, if any, paid on such property, shall be equal to the taxes which would have been payable on such ‘property at far cash value and atthe otherwise applicable tax rate if there had been no abatement or exemption. This payment shal bein addition to the payment made by the ‘Company under Section | of this Agreement. 14. The obligations ofthe Company and the City recited herein are specifically contingent upon the Company obtaining the CCC License for operation of an ME inthe City, 3