PD BACKGROUND REPORT (PL-SPP-2022-000011)

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Once operational, the site will typically run unattended, with one (1) person checking on operations once or twice a week. The applicant will honor Provision 5.05 Licensor's Rights to All Improvements as outlined in the Lease Agreement, which requires the applicant to return the site to its original condition, wear and tear expected, upon termination of the Lease. As stated above, the Lease will expire on February 25th, 2026, unless ASIAA exercises the option to renew for another five (5)years, in which case the Lease would expire on February 25, 2031. Provision 5.05 states the following: Any improvements constructed on the Property by Licensee shall remain on and be surrendered with the Premises on expiration or termination of the term of the License, except that Licensor, in its sole discretion, can elect within thirty (30) days before expiration of the term, or within five (5) days after termination of the term, to require Licensee to remove any improvements that Licensee has constructed on the Property. If Licensor so elects, Licensee, at its cost, shall remove the improvements designated by Licensor in its election and shall restore the premises to its original condition, wear and tear expected, before the last day of the term or within thirty (30) days after notice of election is given, whichever is later. 3B. Subject Property Description The subject site identified as TMK (3) 9-6-008: 067 consists of 21.80 acres zoned A-20a, Agricultural 20-acres. The property is known as Lot 7 located at 96-1048 Center Road in the Wood Valley Homestead Lots, Pahala, Ka`u, Hawaii. The Land Use Pattern Allocation Guide (LUPAG) designated this land as Important Agricultural Land. The Land Study Bureau classifies the soils for this property partially as "B" and partially as "C", or high to moderate agricultural productivity. Under the Agricultural Lands of Importance to the State of Hawaii (ALISH) classification system, the subject site is classified as prime lands. The U.S. Department of Agricultural Natural Resource Conservation Service (MRCS) has designated the soil type for the subject site as roughly 50 percent Alapai hydrous silty clay loam with 10 to 20 percent slopes (2klhb) and roughly 50 percent Kuanene medial fine sandy loam, 3 to 20 percent slopes (2klj6). The Alapai soil is derived from basic volcanic ash over basalt. This soil is very well drained with a very low runoff class. Kuanene soil is derived from ash fields over pahoehoe lava flows. This soil is well drained with a high runoff class. Both soil types classify as "not prime" farmland according to MRCS. The Ka`u area is considered Lava Zone 3, on a scale ranging from 9 to 1 (least hazardous to most). This site is located roughly 8 miles from the ocean and is not in the Conservation District or Special Management Area. 11