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Superlor Courf of California,
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Darren P. Trone, Bar No. 140303 Sacramento
LAW OFFICES OF DARREN P. TRONE 04/05/2024
A Professional Corporation
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3838 Orange Street
Riverside, California 92501 By , Deputy
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Telephone: (951) 686-2975
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Fax: (951) 686-2977
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Email: dtrone@tronelaw.com
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Attorneys for Plaintiff,
SACMAD, LLC, a California limited liability
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SUPERIOR COURT OF THE STATE OF CALIFORNIA
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COUNTY OF SACRAMENTO
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SACMAD, LLC, a California limited liability CASE NO.
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company,
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COMPLAINT FOR BREACH OF LEASE
Plaintiff,
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[Civil Code §1951.2]
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Limited Civil: Amount Demanded Exceeds
IGOR KHASHCHUK, an individual, dba
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$10,000
Flat Roof Pros; and DOES 1 through 20,
inclusive,
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Defendants.
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Plaintiff, SACMAD, LLC, a California limited liability company (“SACMAD”), alleges:
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I Plaintiff is now, and at all relevant times alleged herein was a limited liability
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company organized and existing under the laws of the State of California, with its principal place of
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business in the City of Los Angeles, County of Los Angeles, State of California.
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2, Plaintiff is informed and believes that Defendant IGOR KHASHCHUK, an
individual, dba Flat Roof Pros (“KHASHCHUK?) is now, and all times relevant herein, was a
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competent adult individual residing in the County of Sacramento, State of California.
3. SACMAD is the owner of record and Lessor of the commercial premises located at
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3612 Madison Avenue, Suite 32, City of North Highlands, County of Sacramento, State of
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COMPLAINT FOR BREACH OF CONTRACT
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California, 95660 (“Premises”).
4. The true names or capacities, whether individual, corporate, associate or otherwise of
Defendant DOES 1 through 20, inclusive, are unknown to Plaintiff, who therefore sues said
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Defendants by such fictitious names. Plaintiff is informed and believes and thereon alleges that each
of the Defendants designated herein as DOE is contractually responsible in some manner for
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Plaintiff’s damages and claims some type of possessory interest in and to the Premises.
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5. At all times herein mentioned, each of the Defendants was the agent and employee of
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each of the remaining Defendants and were at all times acting within the purpose and scope of said
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agency and employment.
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6. On or about June 12, 2018, SACMAD leased the Premises to KHASHCHUK
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pursuant to a written Standard Industrial/ Commercial Multi-Tenant Lease- Net agreement for a term
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of three (3) years, commencing August 1, 2018, and ending on July 31, 2021.
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7. In 2018, Defendants entered into possession of the Premises under the terms and the
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conditions of the Lease.
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the Parties extended the term of the
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8. By written first amendment dated June 1, 2021,
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Lease through July 31, 2024. Copies of the Lease and First Amendment are collectively referred to
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as the “Lease,” a copy of which is attached as Exhibit “1.”
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9. The Lease required Defendants to pay Plaintiff minimum monthly rent, and other rent
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related fees and costs (all deemed as “rent” pursuant to section 4.1 of the Lease), payable monthly on
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the first day of each month, subject to annual increase and adjustment as more particularly described
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in the Lease. The monthly rental obligation payable to Plaintiff as of January 1, 2023, was
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$2,221.07 per month.
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10. SACMAD has performed all conditions of the Lease to be performed by SACMAD
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COMPLAINT FOR BREACH OF CONTRACT
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except those obligations that were prevented or excused.
11. Onor about January 1, 2023, and continuing thereafter, Defendants breached the
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terms of the Lease by willfully failing and refusing to pay the monthly rental obligations for the
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Premises.
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12, On June 29, 2023, Plaintiff filed an unlawful detainer action in the Sacramento
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Superior Court, case number 23UD04527, and judgment for possession in favor of Plaintiff was
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entered on October 4, 2023.
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13. On March 7, 2024, Plaintiff obtained possession of the Premises from Defendant
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pursuant to a Writ of Possession levied by the Sheriff’s office.
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14. Section 13 of the Lease permits Plaintiff to recover damages in accordance with
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Section 1951.2 of the Civil Code.
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15. Asof'the date of lease termination, Defendants owe past due rent for the period of
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time between January 1, 2023 and March 7, 2024 in the sum of $4,275.23 (85,777.46 less $1,502.23
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security deposit) pursuant to Civil Code §1951.2(a)(1).
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16. Pursuant to Civil Code §1951.2(a)(2)-(3), Defendants, and each of them, are liable for
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additional lease related damages in excess of $8,623.17 pursuant to Civil Code §1951.2, which
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represent the worth at the time of the award of the amount by which (a) the unpaid rent which
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would have been earned after termination until the time of award exceeds the amount of such rental
loss that the lessee proves could have been reasonably avoided; and (b) the unpaid rent for the
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balance of the term after the time of the award exceeds the amount of such rental loss that the lessee
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proves could be reasonably be awarded.
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17. Pursuant to Civil Code §1951.2(a)(4), Defendants, and each of them, are liable for all
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sums necessary to compensate Plaintiff for all detriment proximately caused by Defendants’ failure
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to perform their obligations under the Lease, or which in the ordinary course of things would be
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COMPLAINT FOR BREACH OF CONTRACT
likely to result therefrom, which sum is estimated to be in excess of $7,921.00 from March 8, 2023
through July 31, 2024, the exact amount to be proven at trial.
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18. Section 31 of the Lease provides that in the event any party to the Lease is compelled
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to commence or sustain an action at law to enforce the terms of the Lease, the prevailing party shall
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be entitled to recover reasonable fees.
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19. Plaintiff has been compelled to commence litigation for the recovery of possession of
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the Premises, and the recovery of the unpaid rent and other fees, costs and charges as provided by
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law, and has retained the Law Offices of Darren P. Trone, a professional corporation, as its
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10 attorneys.
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WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as
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follows:
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1. For unpaid leasehold obligations of approximately $4,275.23 which had accrued at
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15 the time of Lease termination pursuant to Civil Code §1951.2(a)(1;
16 2. For additional damages in excess of $8,623.17 pursuant to Civil Code §1951.2(a)(2)-
17 (3), which represent the worth at the time of the award of the amount by which (a) the unpaid rent
18 which would have been earned after termination until the time of award exceeds the amount of such
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rental loss that the lessee proves could have been reasonably avoided; and (b) the unpaid rent for the
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balance of the term after the time of the award exceeds the amount of such rental loss that the lessee
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proves could be reasonably be awarded;
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23 3. For additional damage of at least $7921 pursuant to Civil Code §1951.2(a)(4) for
24 amounts necessary to compensate lessor for all the detriment proximately caused by the Lessee’s
25 failure to perform their obligations under the Lease or which in the ordinary course of things would
26 be likely to result therefrom, including the cost of recovering the premises, expenses of re-letting,
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including necessary renovation and alteration of the Premises, and that portion of any leasing
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COMPLAINT FOR BREACH OF CONTRACT
= commission paid by lessor in connection with this Lease applicable to the unexpired term of this
Lease;
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4, For reasonable attorney’s fees;
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5. For costs of suit;
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6. Prejudgment interest; and
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7. For any further relief as this court may deem just and proper.
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Dated: April 2, 2024 LAW OFFICES OF DARREN P. TRONE
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A Professional Corporation
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Darren P. Trone, Attorneys for Plaintiff,
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SAMAD, LLC, a California limited liability
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COMPLAINT FOR BREACH OF CONTRACT
DocuSign Envelope 1D: 2BAC34A2-B586-4C67-BA24-6AB6A0FBCF43
AIRCR=Z
STANDARD INDUSTRIAL/COMMERCIAL MULTI-TENANT LEASE - NET
5 & Basic Provisions ("Basic Provisions").
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1.1 Parties. This Lease ("Lease"), dated for reference purposesonly _June 12, 2018 ,ismade byand between _3Sacmad, LLC, a
California limited liability companvy ("lessor’)and _Igor Khashchuk dba Flat Roof Pro's ("Lessee”},
(collectively
the “Parties”, or individually a "Party”). As used herein, the term "Lease™ means this Lease, together with the addendum attached
hereto (the "Addendum™).
1.2(a) Premises: That certain real property, including all improvements therein or to be provided by Lessor under the terms of this Lease, commonly known
as (street address, unit/suite, city,state): _3612 Madison Avenue, Suite 32 ("Premises"). The Premises are located in the County of
| —Sacramento ,andare generally described as (describe briefly the nature of the Premises and/orthe "Project”): _an_approximately 2,400
total sguare foot in-line suite consisting of warehouse and office/restroom space. .In
addition to Lessee's rights to use and occupy the Premises as hereinafter specified, Lessee shall have non-exclusive rights to any utility raceways of the building
containing the Premises (“Building”) and to the Common Areas (as defined in Paragraph 2.7 below), but shall not have any rights to the roof, or exterior walls of the
Building or to any other buildings in the Project. The Premises, the Building, the Common Areas, the land upon which they are located, along with all other buildings
and improvements thereon, are herein collectively referred to as the "Project.” (See also Paragraph 2)
1.2{b) Parking: _In—-common unreserved vehicle parking spaces. {See also Paragraph 2.6)
13 Term: _three (3) vyearsand _thirty-six (36} months("Original Term"} commencing August 1, 2018
("Commencement Date”) andending _Julyv 31, 2021 (“ExpirationDate"). (See also Paragraph 3)
1.4 Early Possession: If the Premises
are available Lessee may have non-exclusive possession of the Premises commencing _upon mutual
execution and deliverv of this lease, receivt of funds as reguired in Paragraph 1.7
below, and evidence of 211 insurance required to be maintained by Lessee in this Lease.
(“Early Possession Date”). (See also Paragraphs 3.2 and 3.3)
15 BaseRent: _S1,416.00 per month("Base Rent"), payable on the _1st day of each month commencing _Aucust 1, 2018
{See also Paragraph 4)
V4 Ifthis box is checked, there are provisions in this Lease for the Base Rent to be adjusted. See Paragraph _52 .
1.6 Lessee's Share of Common Area Operating Expenses: _one point six three two percent(_1.632 %)("Lessee'sShare”). In the
event that the size of the Premises and/or the Project are modified during the term of this Lease, Lessor shall recalculate Lessee's Share to reflect such modification.
1.7 Base Rentand Other Manies Paid Upon Execution:
(3) BaseRent: _$1,416.00 fortheperiod _August 2018 .
(b} Common Area Operating Expenses: _$453.41 fortheperiod August 2018
(c) SecurityDeposit: _S$1,502.23 ("Security Deposit”). (See also Paragraph 5)
(d) Other: S0 for N/A
(e) Total Due Upon Execution of this Lease: _$3,371.64 .
1.8 AgreedUse: _Flat roofing business with offices and warehouse uses related thereto. an d
ne other uses . (SeealsoParagraph 6)
1.9 Insuring Party. Lessoris the "Insuring Party”. (See also Paragraph 8)
1.10 Real Estate Brokers. {See also Paragraph 15 and 25)
__ (a) Representation: The following real estate brokers (the "Brokers”) and brokerage relationships exist in this transaction (check applicable boxes):
M) _Newmark Cornish & Carey represents Lessor exclusively ("Lessor's Broker");
\/ TRI Commercial represents Lessee exclusively {"Lessee's Broker"); or
Lo represents both Lessor and Lessee ("Dual Agency").
(b) Paymentto Brokers, Upon execution and delivery of this Lease by both Parties, Lessor shall pay to the Brokers the brokerage fee agreed toin a
separate written agreement-{os. ifthorais noguch i 2 thasunsof oL ol thotntalBace Runtline tha kml«:ragn Sanises d. A
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bytheBeokacs,
1.11 Guarantor. The obligations of the Lessee under this Lease are to be guaranteed by {"Guarantor"). (See also Paragraph 37)
1.12 Attachments. Attached hereto are the following, all of which constitute a part of this Lease:
v an Addendum consisting of Paragraphs 51 through _56 ;
‘/ asite plan depicting the Premises; {Exhibit A-1)
~\/ acurrent set of the Rules and Regulations for the Project; (Exhibit B)
L] acurrent set of the Rules and Regulations adopted by the owners’ association;
< aWork Letter;
! other (specify):
es. -DS
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INITIA Last Edited: 6/12/2018 4:00 PM INITIALS
© 2017 AIR CRE. AllRights Reserved. MTN-26.10, Revised 11-01-2017
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DocuSign Envelope ID: 2BAC34A2-B586-4C67-BA24-6ABBAOF8CF43
2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases fram Lessor, the Premises, for the term, at the rental, and upon all of the terms,
covenants and conditions set forth in this Lease. While the approximate square footage of the Premises may have been used in the marketing of the Premises for
purposes of comparison, the Base Rentstated herein is NOT tied to square footage and is not subject to adjustment should the actual size be determined to be
different. NOTE: Lessee is advised to verify the actual size prior to executing this Lease.
2.2 Condition. Lessor shall deliver that portion of the Premises contained within the Building ("Unit”) to Lessee it as-in condition beocmcleanand frasof.
dabris on the Commencement Date or the Early Possession Date, whichever first occurs ("Start Date”), and, so long as the required service contracts described in
Paragraph 7.1(b) below are obtained by Lessee and in effect within thirty days following the Start Date, warrants that the existing electrical, plumbing, fire sprinkler,
lighting, heating, ventilating and air conditioning systems ("HVAC"), loading doors, sump pumps, if any, and all other such mechanical elements in the Unit, other
than those constructed by Lessee, shall be in good operating condition on said date, that the structural elements of the roof, bearing walls and foundation of the Unit
shall be free of material defects, and that the Unit does not contain hazardous levels of any mold or fungi defined as toxic under applicable state or federal law. If a
non-compliance with such warranty exists as of the Start Date, or if one of such systems or elements should malfunction or fail within the appropriate warranty
period, Lessor shall, as Lessor's sole obligation with respect to such matter, except as otherwise provided inthis Lease, promptly after receipt of written notice from
Lessee setting forth with specificity the nature and extent of such non-compliance, malfunction or failure, rectify same at Lessor's expense. The warranty periods shall
be as follows: (i} 12 mnonths 6menths as to the HVAC systems, and (ii) 30 days as to the remaining mechanical systems andothez slomentscithallnit, IfLessee
does not give Lessor the required notice within the appropriate warranty period, correction of any such non-compliance, malfunction or failure shall be the obligation
of Lessee at Lessee’s sole cost and expense {except for the repairs to the fire sprinkler systems, roof, foundations, and/or bearing walls - see Paragraph 7). Lessor also
warrants, that unless otherwise specified in writing, Lessar is unaware of (i) any recorded Notices of Default affecting the Premise; (i) any delinquent amounts due
under any loan secured by the Premises; and {iii) any bankruptcy proceeding affecting the Premises.
23 Compliance. Lessor warrants that to Lessot's current, actual thebast-ofits knowledge the improvements onthe Premises comply with the building
codes, applicable laws, covenants or restrictions of record, regulations, and ardinances ("Applicable Requirements”) that were in effect at the time that each
improvement, or portion thereof, was constructed. Said warranty does not apply to the use to which Lessee will put the Premises, modifications which may be
required by the Americans with Disabilities Act or any similar laws as a result of Lessee's use (see Paragraph 49), or to any Alterations or Utility Installations {as defined
in Paragraph 7.3(a}) made orto be made by Lessee. NOTE: Lesseeis responsible for determining whether or not the Applicable Requirements, and especially the
zomng areapprnprlate for Lessee's intended use, and aclmowledges that past uses of the Premzsesmay no longer be aflowed J&he.fl;em;snsda-na:-csmp#ml.
= ansa, Ifthe Apphcable Requ»rements are
hereafterchanged soas tu requ:re durmg the term of this Lease the construchon ofan addmon tooran alteranon of the Unit, Premises and/or Building, the
remediation of any Hazardaus Substance, or the reinforcementar other physical modification of the Unit, Premises and/or Building {“Capital Expenditure"), Lessor
and Lessee shall allocate the cost of such work as follows:
{a) Subject to Paragraph 2.3(c) below, if such Capital Expenditures are required as a result of the specific and unique use of the Premises by Lessee as
compared with uses by tenants in general, Lessee shall be fully responsible for the cost thereof, provided, however, that if such Capital Expenditure is required during
the last 2 years of this Lease and the cost thereof exceeds 6 months' Base Rent, Lessee may instead terminate this Lease unless Lessor notifies Lessee, in writing,
within 10 days after receipt of Lessee's termination notice that Lessor has elected to pay the difference between the actual cost thereof and the amount equal to 6
months' Base Rent. If Lessee elects termination, Lessee shall immediately cease the use of the Premises which requires such Capital Expenditure and deliver to Lessor
written notice specifying a termination date at least 90 days thereafter. Such termination date shall, however, in no event be earlier than the last day that Lessee
could legally utilize the Premises without commencing such Capital Expenditure.
{b) Ifsuch Capital Expenditure is not the result of the specificand unique use of the Premises by Lessee (such as, governmentally mandated seismic
modifications), then Lessor shall pay for such Capital Expenditure and Lessee shall only be obligated to pay, each month during the remainder of the term of this Lease
or any extension thereof, on the date that on which the Base Rent is due, an amount equalto 1/144th of the partion of such costs reasonably attributable to the
Premises. Lessee shall pay Interest on the balance but may prepay its obligation at any time. If, however, such Capital Expenditure is required during the last 2 years
of this Lease or if Lessorreasonably determines that it is not economically feasible to pay its share thereof, Lessor shall have the option to terminate this Lease upon
90 days prior written notice to Lessee unless Lessee notifies Lessor, in writing, within 10 days after receipt of Lessor's termination notice that Lessee will pay forsuch
Capital Expenditure. If Lessor does not elect to terminate, and fails to tender its share of anysuch Capital Expenditure, Lessee may advance such funds and deduct
same, with Interest, from Rent until Lessor's share of such costs have been fully paid. If Lessee is unable to finance Lessor's share, or if the balance of the Rent due
and payable for the remainder of this Lease is not sufficient to fully reimburse Lessee on an offset basis, Lessee shall have the right to terminate this Lease upon 30
days written notice to Lessor.
{c) Notwithstanding the above, the provisions concerning Capital Expenditures are intended to apply only to non-voluntary, unexpected, and new
Applicable Requirements. If the Capital Expenditures areinstead triggered by Lessee as a result of an actual or proposed change in use, change in intensity of use, or
madification to the Premises then, and in that event, Lessee shall either: (i} immediately cease such changed use or intensity of use and/or take such other steps as
may be necessaryto eliminate the requirement for such Capital Expenditure, or (ii) complete such Capital Expenditure at its own expense. Lesseeshall not have any
right to terminate this Lease.
2.4 Acknowledgements. Lessee acknowledges that: (a)it has been given an opportunity to inspect and measure the Premises, {b) it has been advised by
Lessor and/or Brokers to satisfy itself with respect to the size and condition of the Premises {including but not limited to the electrical, HVAC and fire sprinkler
systems, security, environmental aspects, and compliance with Applicable Requirements and the Americans with Disabilities Act), and their suitability for Lessee's
intended use, (c) Lessee has made such investigation'as it deems necessary with reference to such matters and assumes all responsibility therefor as the same relate
to its occupancy of the Premises, (d} it is not relying on any representation as to the size of the Premises made by Brokers or Lessar, () the square footage of the
Premises was not material to Lessee's decision to lease the Premises and pay the Rent stated herein, and (f) neither Lessor, Lessor's agents, nor Brokers have made
any oral or wrmanrepresentahons or warranues thh respect to sand matters other than asset forth in thiS Lease Mmmmdmwkdgewm
2.5 Lessee as Prior Owner/Occupant. The warranties made by Lessor in Paragraph 2 shall be of no force or effect if immediately prior to the Start Date Lessee
was the owner or occupant of the Premises. Insuch event, Lessee shall be respansible for any necessary corrective work.
2.6 Vehicle Parking. Lesseeshall be entitled to use the number of Parking Spaces spemfled in Paragraph 1.2(b) onthose portions of the Common Areas
designated from time to time by Lessor for parking. Lessee shall riot use more parking spaces than said number. Said parking spaces shall be used for parking by
vehicles no farger than full-size passenger automobiles or pick-up trucks, herein called "Permitted Size Vehicles.” Lessor mayregulate the loading and unloading of
vehicles by adopting Rules and Regulations as provided in Paragraph 2.9. No vehicles other than Permitted Size Vehicles maybe parked in the Common Area wmmut
the prior written permission of Lessor. In addition:
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DocuSign Envelope ID: 2BAC34A2-B586-4C67-BA24-6ABBAOFBCF43
(a) Lessee shall not permit or allow any vehicles that belang to or are controlled by Lessee or Lessee’s employees, suppliers, shippers, customers,
contractors or invitees to be loaded, unloaded, or parked in areas other than those designated by Lessor for such activities.
(b) Lesseeshall not service or store any vehicles in the Common Areas.
(c) IfLessee permits or allows any of the prohibited activities described in this Paragraph 2.6, then Lessor shall have the right, without notice, in addition
to such other rights and remedies that it may have, to remove or tow away the vehicle involved and charge the cost to Lessee, which cost shall be immediately
payable upon demand by Lessor.
2.7 Common Areas - Definition, The term "Common Areas” is defined as all areas and facilities outside the Premises and within the exterior boundary line of
the Project and interior utility raceways and installations within the Unit that are provided and designated by the Lessor from time to time for the general
non-exclusive use of Lessor, Lessee and other tenants of the Project and their respective employees, suppliers, shippers, customers, contractors and invitees, including
parking areas, loading and unloading areas, trash areas, roofs, roadways, walkways, driveways and landscaped areas.
2.8 Common Areas - Lessee’s Rights. Lessor grants to Lessee, far the benefit of Lessee and its employees, suppliers, shippers, contractors, customers and
invitees, during the term of this Lease, the nan-exclusive right to use, in common with others entitled to such use, the Common Areas as they exist from time to time,
subject to any rights, powers, and privileges reserved by Lessor under the terms hereof or under the terms of any rules and regulations or restrictions governing the
use of the Project. Under no circumstances shall the right herein granted to use the Common Areas be deemed to include the right to store any property, temporarily
or permanently, in the Common Areas. Any such storage shall be permitted only by the prior written consent of Lessor or Lessor's designated agent, which consent
may be revoked at any time. Inthe event that any unauthorized storage shall occur, then Lessor shall have the right, without notice, in addition to such other rights
and remedies that it may have, to remove the property and charge the cost to Lessee, which cost shall be immediately payable upon demand by Lessor.
2.9 Common Areas - Rules and Regulations. Lessor or such other person(s) as Lessor may appoint shall have the exclusive control and management of the
Common Areas and shall have the right, from time to time, to establish, modify, amend and enforce reasonable rules and regulations (“Rules and Regulations") for
the management, safety, care, and cleanliness of the grounds, the parking and unloading of vehicles and the preservation of good order, as well as for the convenience
of other occupants or tenants of the Bullding and the Project and their invitees. Lessee agrees to abide by and conform to all such Rules and Regulations, and shall
use its best efforts to cause its employees, suppliers, shippers, customers, contractors and invitees to so abide and conform. Lessor shall not be responsible to Lessee
for the non-compliance with said Rules and Regulations by other tenants of the Project.
2.10 Common Areas - Changes. Lessor shall have the right, in Lessor’s sole discretion, from time to time:
(3) To make changes to the Common Areas, including, without limitation, changes in the location, size, shape and number of driveways, entrances,
parking spaces, parking areas, loading and unloading areas, ingress, egress, direction of traffic, landscaped areas, walkways and utility raceways;
(b) To close temporarily any of the Common Areas for maintenance purposes so long as reasonable access to the Premises remains available;
(c) Todesignate other land outside the boundaries of the Project to be a part of the Common Areas;
(d) Toadd additional buildings and improvementsto the Common Areas;
({e) To usethe Common Areas while engaged in making additional improvements, repairs or alterations to the Project, or any portion thereof; and
(f) To doand perform such other acts and make such other changes in, to or with respect to the Common Areas and Project as Lessor may, in the
exercise of sound business judgment, deem to be appropriate.
3. Term.
3.1 Term. The Commencement Date, Expiration Date and Original Term of this Lease are as specified in Paragraph 1.3.
3.2 Early Possession. Any provision herein granting Lessee Early Possession of the Premises is subject to and conditioned upon the Premises being available
for such possession prior to the Commencement Date. Any grant of Early Possession only conveys a non-exclusive right to occupy the Premises. If Lessee totally or
partially occupies the Premises prior to the Commencement Date, the obligation to pay Base Rent shall be abated for the period of such Early Possession. All other
terms of this Lease (including but not limited to the obligations to pay Lessee's Share of Common Area Operating Expenses, Real Property Taxes and insurance
premiums and to maintain the Premises) shall be in effect during such period. Anysuch Early Possession shall not affect the Expiration Date.
3.3 Delay InPossession. Lessor agrees to use its best commercially reasonable efforts to deliver possession of the Premises to Lessee by the Commencement
Date. If, despite said efforts, Lessor is unable to deliver possession by such date, Lessor shall not be subject to any liability therefor, nor shall such failure affect the
validity of this Lease or change the Expiration Date. Lessee shall not, however, be obligated to pay Rent or perform its other obligations until Lessor delivers
possession of the Premises and any period of rent abatement that Lessee would otherwise have enjoyed shall run from the date of delivery of possession and
continue for a period equal to what Lessee would otherwise have enjoyed under the terms hereof, but minus any days of delay caused by the acts or omissions of
Lessee. If possession is not delivered within 60 days after the Commencement Date, as the same may be extended under the terms of any Work Letter executed by
Parties, Lessee may, at its option, by notice in writing within 10 days after the end of such 60 day period, cancel this Lease, in which event the Parties shall be
discharged from all obligations hereunder. If such written notice is not recelved by Lessor within said 10 day period, Lessee's right to cancel shall terminate. If
possession of the Premises is not delivered within 120 days after the Commencement Date, this Lease shall terminate unless other agreements are reached between
Lessor and Lessee, in writing.
3.4 Lessee Compliance. Lessor shall not be required to tender possession of the Premises to Lessee until Lessee complies with its obligation to provide
evidence of insurance (Paragraph 8.5). Pending delivery of such evidence, Lessee shall be required to perform all of its obligations under this Lease from and after the
Start Date, including the payment of Rent, notwithstanding Lessor's election to withhold possession pending receipt of such evidence of insurance. Further, if Lessee
is required to perform any other conditions prior to or concurrent with the Start Date, the Start Date shall occur but Lessor may elect to withhold possession until such
conditions are satisfied.
4. Rent.
4.1. RentDefined. Allmonetary obligations of Lessee to Lessor under the terms of this Lease (except for the Security Deposit) are deemed to be rent ("Rent”).
4.2 Common Area Operating Expenses. Lessee shall pay to Lessor during the term hereof, in addition to the Base Rent, Lessee's Share (as specified in
Paragraph 1.6) of all Common Area Operating Expenses, as hereinafter defined, during each calendar year of the term of this Lease, in accordance with the following
provisions:
{a) “Common Area Operating Expenses" are defined, for purposes of this Lease, as all costs relating to the ownership and operation of the Project,
including, but not limited to, the following:
(i) The operation, repair and maintenance, in neat, clean, good order and condition , and if necessary the replacement, of the following:
(aa) The Common Areas and Common Area improvements, including parking areas, loading and unloading areas, trash areas, roadways,
parkways, walkways, driveways, landscaped areas, bumpers, irrigation systems, Common Area lighting facilities, fences and gates, elevators, raofs, exterior walls of the
buildings, building systems and roof drainage systems.
(bb) Exterior signs and any tenant directories.
(cc) Any fire sprinkler systems.
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{dd) All other areas and improvements that are within the exterior boundaries of the Project but outside of the Premises and/or any other
space occupied by a tenant.
(ii) The cost of water, gas, electricity and telephone to service the Common Areas and any utilities not separately metered.
{iii} The cost of trash dispasal, pest control services, property management, security services, owners' asscciation dues and fees, the cost to repaint
the exterior of any structures and the cost of any environmental inspections.
(iv} Reserves set aside for maintenance, repair and/or replacement of Common Area improvements and equipment.
(v} Real Property Taxes {as defined in Paragraph 10).
(vi) The cost of the premiums for the insurance maintained by Lessor pursuant to Paragraph 8.
(vii) Any deductible portion of an insured loss concerning the Building or the Common Areas.
(viii) Auditors’, accountants' and attorneys’ fees and costs related to the operation, maintenance, repair and replacement of the Project.
{ix) The cost of any capital improvement to the Building or the Project not covered under the provisionsof Paragraph 2.3 provided; however, that
Lessor shall allocate the cost of any such capital improvement over a 12 year period and Lessee shall not be required to pay more than Lessee's Share of 1/144th of
the cost of such capital improvement in any given month. Lessee shall pay Interest on the unamortized balance but may prepay its obligation atany time.
{x) The cost of any other services to be provided by Lessor that are stated elsewhere in this Lease to be a Common Area Operating Expense.
(xi) Costs of painting the exterior of any buildings in the Project and any costs to maintain, repair, replace, and restripe
any parking arcas.
(b) AnyCommon Area Operating Expenses and Real Property Taxes that are specifically attributable to the Unit, the Building or to any other building in
the Project or to the operation, repair and maintenance thereof, shall be allocated entirely to such Unit, Building, or other building at Lessot’s election. However,
any Common Area Operating Expenses and Real Property Taxes that are not specifically attributable to the Building or to any ather building or to the operation, repair
and maintenance thereof, shall be equitably allocated by Lessor to all buildings in the Project.
{c) Theinclusion of the improvements, facilities and services set forth in Subparagraph 4.2(a) shall not be deemed to impose an obligation upon Lessor to
either have said improvements or facilities or to provide those services unless the Project already has the same, Lessor already provides the services, or Lessor has
agreed elsewhere in this Lease to provide the same or some of them.
(d) Lessee's Share of Common Area Operating Expenses is payable monthly on the same day as the Base Rent is due hereunder. The amount of such
payments shall be based on Lessor's estimate of the annual Common Area Operating Expenses. Within 60 days after written request (but not more than once each
year) Lessor shall deliver to Lessee a reasonably detailed statement showing Lessee's Share of the actual Common Area Operating Expenses for the preceding year. If
Lessee's payments during such year exceed Lessee's Share, Lessor shall credit the amount of such over-payment against Lessee's future payments. If Lessee’s
payments during such year were less than Lessee’s Share, Lessee shall pay to Lessor the amount of the deficiency within 30 38 days after delivery by Lessor to Lessee
of the statement.
(e} Common Area Operating Expenses shall not include any expenses paid by any tenant directly to third parties, or as to which Lessor is otherwise
reimbursed by any third party, other tenant, or insurance proceeds.
4.3 Payment. Lessee shall cause payment of Rent to be received by Lessor in lawful money of the United States, without offset or deduction (except as
specifically permitted in this Lease), on or before the day on which it is due. All monetary amounts shall be rounded to the nearest whole dollar. In the event that any
invoice prepared by Lessor is inaccurate such inaccuracy shall not constitute a waiver and Lessee shall be obligated to pay the amount set forth in this Lease. Rent for
any period during the term hereof which is for less than one full calendar manth shall be prorated based upon the actual number of days of said month. Payment of
Rent shall be made to Lessor at its address stated herein or to such other persans or place as Lessor may from time to time designate in writing. Acceptance of a
payment which is less than the amount then due shall not be 3 waiver of Lessor's rights to the balance of such Rent, regardless of Lessor's endorsement of any check
sostating. In the event that any check, draft, or other instrument of payment given by Lessee to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor
the sum of $25 in addition to any Late Charge and Lessor, at its option, may require all future Rent be paid by cashier's check. Payments will be applied first to accrued
late charges and attorney’s fees, second to accrued interest, then to Base Rent and Common Area Operating Expenses, and any remaining amount to any other
outstanding charges or costs.
5. Security Deposit. Lessee shall deposit with Lessor upon execution hereof the Security Deposit as security for Lessee’s faithful performance of its obligations
under this Lease. If Lessee fails to pay Rent, or otherwise Defaults under this Lease, Lessor may use, applyor retain all or any portion of said Security Deposit for the
payment of any amount already due Lessor, for Rents which will be due in the future, and/ or to reimburse or compensate Lessor for any liability, expense, loss or
damage which Lessor may suffer or incur by reason thereof. If Lessor uses or applies all or any portion of the Security Deposit, Lessee shall within 10 days after
written request therefor deposit monies with Lessor sufficient to restore said Security Deposit to the full amgunt required by this Lease. If the Base Rent increases
during the term of this Lease, Lessee shall, upon written request from Lessor, deposit additional monies with Lessorso that the total amount of the Security Deposit
shall at all times bear the same proportion to the increased Base Rent as the initial Security Deposit bore to the initial Base Rent. Should the Agreed Use be amended
to accommodate a material change in the business of Lessee or to accommodate a sublessee or assignee, Lessor shall have the right to increase the Security Deposit
to the extent necessary, in Lessor's reasonable judgment, to account for any increased wear and tear that the Premises may suffer as a result thereof. If a change in
control of Lessee occurs during this Lease and following such change the financial condition of Lessee is, in Lessor’s reasonable judgment, significantly reduced, Lessee
shall deposit such additional monies with Lessor as shall be sufficient to cause the Security Deposit to be at a commercially reasonable level based on such change in
financial condition. Lessor shall not be required to keep the Security Deposit separate fromits general accounts. Within S0 days after the expiration or termination of
this Lease, Lessor shall return that portion of the Security Depasit not used or applied by Lessor. Lessor shall upon written request provide Lessee with an accounting
showing how that portion of the Security Deposit that was not returned was applied. No part of the Security Deposit shall be considered to be held in trust, to bear
interest or to be prepayment for any monies to be paid by Lessee under this Lease. THE SECURITY DEPOSIT SHALL NOT BE USED BY LESSEE IN LIEU OF PAYMENT OF
THE LAST MONTH'S RENT.
6. Use.
6.1 Use. Lessee shall use and occupy the Premises only for the Agreed Use, or any other legal use which is reasonably comparable thereto, and for no other
purpose. unless expressly consented to in writing. which consent Lessor may give or withhold in its sole and absolute discretion. Lessee
shalt not use or permit the use of the Premises in a manner that is unlawful, creates damage. waste or a nuisance, or that distur
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Hed Superlor Courf of California, - Darren P. Trone, Bar No. 140303 Sacramento LAW OFFICES OF DARREN P. TRONE 04/05/2024 A Professional Corporation rnusseit N 3838 Orange Street Riverside, California 92501 By , Deputy W Telephone: (951) 686-2975 24CVDO6753 Fax: (951) 686-2977 A Email: dtrone@tronelaw.com Wwnm Attorneys for Plaintiff, SACMAD, LLC, a California limited liability O company N SUPERIOR COURT OF THE STATE OF CALIFORNIA 00 COUNTY OF SACRAMENTO O© e SACMAD, LLC, a California limited liability CASE NO. ll-hle\)'—‘O company, e COMPLAINT FOR BREACH OF LEASE Plaintiff, e [Civil Code §1951.2] V. e Limited Civil: Amount Demanded Exceeds IGOR KHASHCHUK, an individual, dba = $10,000 Flat Roof Pros; and DOES 1 through 20, inclusive, e Q\U’l-bul\)h—-O\OOO\lO\l Defendants. e e Plaintiff, SACMAD, LLC, a California limited liability company (“SACMAD”), alleges: s I Plaintiff is now, and at all relevant times alleged herein was a limited liability = company organized and existing under the laws of the State of California, with its principal place of NN business in the City of Los Angeles, County of Los Angeles, State of California. N 2, Plaintiff is informed and believes that Defendant IGOR KHASHCHUK, an individual, dba Flat Roof Pros (“KHASHCHUK?) is now, and all times relevant herein, was a NN competent adult individual residing in the County of Sacramento, State of California. 3. SACMAD is the owner of record and Lessor of the commercial premises located at 27 3612 Madison Avenue, Suite 32, City of North Highlands, County of Sacramento, State of —1- COMPLAINT FOR BREACH OF CONTRACT WD California, 95660 (“Premises”). 4. The true names or capacities, whether individual, corporate, associate or otherwise of Defendant DOES 1 through 20, inclusive, are unknown to Plaintiff, who therefore sues said A Defendants by such fictitious names. Plaintiff is informed and believes and thereon alleges that each of the Defendants designated herein as DOE is contractually responsible in some manner for O Plaintiff’s damages and claims some type of possessory interest in and to the Premises. NN 00 5. At all times herein mentioned, each of the Defendants was the agent and employee of O each of the remaining Defendants and were at all times acting within the purpose and scope of said O agency and employment. = e 6. On or about June 12, 2018, SACMAD leased the Premises to KHASHCHUK e WD pursuant to a written Standard Industrial/ Commercial Multi-Tenant Lease- Net agreement for a term e e R of three (3) years, commencing August 1, 2018, and ending on July 31, 2021. e 7. In 2018, Defendants entered into possession of the Premises under the terms and the e NN conditions of the Lease. e the Parties extended the term of the ® = 8. By written first amendment dated June 1, 2021, O = Lease through July 31, 2024. Copies of the Lease and First Amendment are collectively referred to NN =S as the “Lease,” a copy of which is attached as Exhibit “1.” NN 9. The Lease required Defendants to pay Plaintiff minimum monthly rent, and other rent WN related fees and costs (all deemed as “rent” pursuant to section 4.1 of the Lease), payable monthly on NN the first day of each month, subject to annual increase and adjustment as more particularly described bR N in the Lease. The monthly rental obligation payable to Plaintiff as of January 1, 2023, was DN O $2,221.07 per month. N NN 10. SACMAD has performed all conditions of the Lease to be performed by SACMAD 0 . COMPLAINT FOR BREACH OF CONTRACT - except those obligations that were prevented or excused. 11. Onor about January 1, 2023, and continuing thereafter, Defendants breached the WD terms of the Lease by willfully failing and refusing to pay the monthly rental obligations for the A Premises. N 12, On June 29, 2023, Plaintiff filed an unlawful detainer action in the Sacramento O Superior Court, case number 23UD04527, and judgment for possession in favor of Plaintiff was N 00 entered on October 4, 2023. O 13. On March 7, 2024, Plaintiff obtained possession of the Premises from Defendant e O pursuant to a Writ of Possession levied by the Sheriff’s office. o=~ e 14. Section 13 of the Lease permits Plaintiff to recover damages in accordance with PN e Section 1951.2 of the Civil Code. e W 15. Asof'the date of lease termination, Defendants owe past due rent for the period of A e time between January 1, 2023 and March 7, 2024 in the sum of $4,275.23 (85,777.46 less $1,502.23 WM e security deposit) pursuant to Civil Code §1951.2(a)(1). e 9O 16. Pursuant to Civil Code §1951.2(a)(2)-(3), Defendants, and each of them, are liable for ® additional lease related damages in excess of $8,623.17 pursuant to Civil Code §1951.2, which e © represent the worth at the time of the award of the amount by which (a) the unpaid rent which R, S NN would have been earned after termination until the time of award exceeds the amount of such rental loss that the lessee proves could have been reasonably avoided; and (b) the unpaid rent for the N N balance of the term after the time of the award exceeds the amount of such rental loss that the lessee W NN proves could be reasonably be awarded. A L 17. Pursuant to Civil Code §1951.2(a)(4), Defendants, and each of them, are liable for all NN & sums necessary to compensate Plaintiff for all detriment proximately caused by Defendants’ failure N DN to perform their obligations under the Lease, or which in the ordinary course of things would be ® - COMPLAINT FOR BREACH OF CONTRACT likely to result therefrom, which sum is estimated to be in excess of $7,921.00 from March 8, 2023 through July 31, 2024, the exact amount to be proven at trial. N W 18. Section 31 of the Lease provides that in the event any party to the Lease is compelled B~ to commence or sustain an action at law to enforce the terms of the Lease, the prevailing party shall n be entitled to recover reasonable fees. O 19. Plaintiff has been compelled to commence litigation for the recovery of possession of N the Premises, and the recovery of the unpaid rent and other fees, costs and charges as provided by 0 law, and has retained the Law Offices of Darren P. Trone, a professional corporation, as its O 10 attorneys. 11 WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as 12 follows: 13 1. For unpaid leasehold obligations of approximately $4,275.23 which had accrued at 14 15 the time of Lease termination pursuant to Civil Code §1951.2(a)(1; 16 2. For additional damages in excess of $8,623.17 pursuant to Civil Code §1951.2(a)(2)- 17 (3), which represent the worth at the time of the award of the amount by which (a) the unpaid rent 18 which would have been earned after termination until the time of award exceeds the amount of such 19 rental loss that the lessee proves could have been reasonably avoided; and (b) the unpaid rent for the 20 balance of the term after the time of the award exceeds the amount of such rental loss that the lessee 21 proves could be reasonably be awarded; 22 23 3. For additional damage of at least $7921 pursuant to Civil Code §1951.2(a)(4) for 24 amounts necessary to compensate lessor for all the detriment proximately caused by the Lessee’s 25 failure to perform their obligations under the Lease or which in the ordinary course of things would 26 be likely to result therefrom, including the cost of recovering the premises, expenses of re-letting, 27 including necessary renovation and alteration of the Premises, and that portion of any leasing 28 —4— COMPLAINT FOR BREACH OF CONTRACT = commission paid by lessor in connection with this Lease applicable to the unexpired term of this Lease; N W 4, For reasonable attorney’s fees; A 5. For costs of suit; w» 6. Prejudgment interest; and & 7. For any further relief as this court may deem just and proper. N Dated: April 2, 2024 LAW OFFICES OF DARREN P. TRONE 0 A Professional Corporation © o Darren P. Trone, Attorneys for Plaintiff, e = SAMAD, LLC, a California limited liability company ek WLN et e NNl o ot NN ee O N O N = N WN N R N U NN O N NN 00 —-5— COMPLAINT FOR BREACH OF CONTRACT DocuSign Envelope 1D: 2BAC34A2-B586-4C67-BA24-6AB6A0FBCF43 AIRCR=Z STANDARD INDUSTRIAL/COMMERCIAL MULTI-TENANT LEASE - NET 5 & Basic Provisions ("Basic Provisions"). o~ 1.1 Parties. This Lease ("Lease"), dated for reference purposesonly _June 12, 2018 ,ismade byand between _3Sacmad, LLC, a California limited liability companvy ("lessor’)and _Igor Khashchuk dba Flat Roof Pro's ("Lessee”}, (collectively the “Parties”, or individually a "Party”). As used herein, the term "Lease™ means this Lease, together with the addendum attached hereto (the "Addendum™). 1.2(a) Premises: That certain real property, including all improvements therein or to be provided by Lessor under the terms of this Lease, commonly known as (street address, unit/suite, city,state): _3612 Madison Avenue, Suite 32 ("Premises"). The Premises are located in the County of | —Sacramento ,andare generally described as (describe briefly the nature of the Premises and/orthe "Project”): _an_approximately 2,400 total sguare foot in-line suite consisting of warehouse and office/restroom space. .In addition to Lessee's rights to use and occupy the Premises as hereinafter specified, Lessee shall have non-exclusive rights to any utility raceways of the building containing the Premises (“Building”) and to the Common Areas (as defined in Paragraph 2.7 below), but shall not have any rights to the roof, or exterior walls of the Building or to any other buildings in the Project. The Premises, the Building, the Common Areas, the land upon which they are located, along with all other buildings and improvements thereon, are herein collectively referred to as the "Project.” (See also Paragraph 2) 1.2{b) Parking: _In—-common unreserved vehicle parking spaces. {See also Paragraph 2.6) 13 Term: _three (3) vyearsand _thirty-six (36} months("Original Term"} commencing August 1, 2018 ("Commencement Date”) andending _Julyv 31, 2021 (“ExpirationDate"). (See also Paragraph 3) 1.4 Early Possession: If the Premises are available Lessee may have non-exclusive possession of the Premises commencing _upon mutual execution and deliverv of this lease, receivt of funds as reguired in Paragraph 1.7 below, and evidence of 211 insurance required to be maintained by Lessee in this Lease. (“Early Possession Date”). (See also Paragraphs 3.2 and 3.3) 15 BaseRent: _S1,416.00 per month("Base Rent"), payable on the _1st day of each month commencing _Aucust 1, 2018 {See also Paragraph 4) V4 Ifthis box is checked, there are provisions in this Lease for the Base Rent to be adjusted. See Paragraph _52 . 1.6 Lessee's Share of Common Area Operating Expenses: _one point six three two percent(_1.632 %)("Lessee'sShare”). In the event that the size of the Premises and/or the Project are modified during the term of this Lease, Lessor shall recalculate Lessee's Share to reflect such modification. 1.7 Base Rentand Other Manies Paid Upon Execution: (3) BaseRent: _$1,416.00 fortheperiod _August 2018 . (b} Common Area Operating Expenses: _$453.41 fortheperiod August 2018 (c) SecurityDeposit: _S$1,502.23 ("Security Deposit”). (See also Paragraph 5) (d) Other: S0 for N/A (e) Total Due Upon Execution of this Lease: _$3,371.64 . 1.8 AgreedUse: _Flat roofing business with offices and warehouse uses related thereto. an d ne other uses . (SeealsoParagraph 6) 1.9 Insuring Party. Lessoris the "Insuring Party”. (See also Paragraph 8) 1.10 Real Estate Brokers. {See also Paragraph 15 and 25) __ (a) Representation: The following real estate brokers (the "Brokers”) and brokerage relationships exist in this transaction (check applicable boxes): M) _Newmark Cornish & Carey represents Lessor exclusively ("Lessor's Broker"); \/ TRI Commercial represents Lessee exclusively {"Lessee's Broker"); or Lo represents both Lessor and Lessee ("Dual Agency"). (b) Paymentto Brokers, Upon execution and delivery of this Lease by both Parties, Lessor shall pay to the Brokers the brokerage fee agreed toin a separate written agreement-{os. ifthorais noguch i 2 thasunsof oL ol thotntalBace Runtline tha kml«:ragn Sanises d. A T bytheBeokacs, 1.11 Guarantor. The obligations of the Lessee under this Lease are to be guaranteed by {"Guarantor"). (See also Paragraph 37) 1.12 Attachments. Attached hereto are the following, all of which constitute a part of this Lease: v an Addendum consisting of Paragraphs 51 through _56 ; ‘/ asite plan depicting the Premises; {Exhibit A-1) ~\/ acurrent set of the Rules and Regulations for the Project; (Exhibit B) L] acurrent set of the Rules and Regulations adopted by the owners’ association; < aWork Letter; ! other (specify): es. -DS — K. Page 1 of 17 INITIA Last Edited: 6/12/2018 4:00 PM INITIALS © 2017 AIR CRE. AllRights Reserved. MTN-26.10, Revised 11-01-2017 - - DocuSign Envelope ID: 2BAC34A2-B586-4C67-BA24-6ABBAOF8CF43 2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases fram Lessor, the Premises, for the term, at the rental, and upon all of the terms, covenants and conditions set forth in this Lease. While the approximate square footage of the Premises may have been used in the marketing of the Premises for purposes of comparison, the Base Rentstated herein is NOT tied to square footage and is not subject to adjustment should the actual size be determined to be different. NOTE: Lessee is advised to verify the actual size prior to executing this Lease. 2.2 Condition. Lessor shall deliver that portion of the Premises contained within the Building ("Unit”) to Lessee it as-in condition beocmcleanand frasof. dabris on the Commencement Date or the Early Possession Date, whichever first occurs ("Start Date”), and, so long as the required service contracts described in Paragraph 7.1(b) below are obtained by Lessee and in effect within thirty days following the Start Date, warrants that the existing electrical, plumbing, fire sprinkler, lighting, heating, ventilating and air conditioning systems ("HVAC"), loading doors, sump pumps, if any, and all other such mechanical elements in the Unit, other than those constructed by Lessee, shall be in good operating condition on said date, that the structural elements of the roof, bearing walls and foundation of the Unit shall be free of material defects, and that the Unit does not contain hazardous levels of any mold or fungi defined as toxic under applicable state or federal law. If a non-compliance with such warranty exists as of the Start Date, or if one of such systems or elements should malfunction or fail within the appropriate warranty period, Lessor shall, as Lessor's sole obligation with respect to such matter, except as otherwise provided inthis Lease, promptly after receipt of written notice from Lessee setting forth with specificity the nature and extent of such non-compliance, malfunction or failure, rectify same at Lessor's expense. The warranty periods shall be as follows: (i} 12 mnonths 6menths as to the HVAC systems, and (ii) 30 days as to the remaining mechanical systems andothez slomentscithallnit, IfLessee does not give Lessor the required notice within the appropriate warranty period, correction of any such non-compliance, malfunction or failure shall be the obligation of Lessee at Lessee’s sole cost and expense {except for the repairs to the fire sprinkler systems, roof, foundations, and/or bearing walls - see Paragraph 7). Lessor also warrants, that unless otherwise specified in writing, Lessar is unaware of (i) any recorded Notices of Default affecting the Premise; (i) any delinquent amounts due under any loan secured by the Premises; and {iii) any bankruptcy proceeding affecting the Premises. 23 Compliance. Lessor warrants that to Lessot's current, actual thebast-ofits knowledge the improvements onthe Premises comply with the building codes, applicable laws, covenants or restrictions of record, regulations, and ardinances ("Applicable Requirements”) that were in effect at the time that each improvement, or portion thereof, was constructed. Said warranty does not apply to the use to which Lessee will put the Premises, modifications which may be required by the Americans with Disabilities Act or any similar laws as a result of Lessee's use (see Paragraph 49), or to any Alterations or Utility Installations {as defined in Paragraph 7.3(a}) made orto be made by Lessee. NOTE: Lesseeis responsible for determining whether or not the Applicable Requirements, and especially the zomng areapprnprlate for Lessee's intended use, and aclmowledges that past uses of the Premzsesmay no longer be aflowed J&he.fl;em;snsda-na:-csmp#ml. = ansa, Ifthe Apphcable Requ»rements are hereafterchanged soas tu requ:re durmg the term of this Lease the construchon ofan addmon tooran alteranon of the Unit, Premises and/or Building, the remediation of any Hazardaus Substance, or the reinforcementar other physical modification of the Unit, Premises and/or Building {“Capital Expenditure"), Lessor and Lessee shall allocate the cost of such work as follows: {a) Subject to Paragraph 2.3(c) below, if such Capital Expenditures are required as a result of the specific and unique use of the Premises by Lessee as compared with uses by tenants in general, Lessee shall be fully responsible for the cost thereof, provided, however, that if such Capital Expenditure is required during the last 2 years of this Lease and the cost thereof exceeds 6 months' Base Rent, Lessee may instead terminate this Lease unless Lessor notifies Lessee, in writing, within 10 days after receipt of Lessee's termination notice that Lessor has elected to pay the difference between the actual cost thereof and the amount equal to 6 months' Base Rent. If Lessee elects termination, Lessee shall immediately cease the use of the Premises which requires such Capital Expenditure and deliver to Lessor written notice specifying a termination date at least 90 days thereafter. Such termination date shall, however, in no event be earlier than the last day that Lessee could legally utilize the Premises without commencing such Capital Expenditure. {b) Ifsuch Capital Expenditure is not the result of the specificand unique use of the Premises by Lessee (such as, governmentally mandated seismic modifications), then Lessor shall pay for such Capital Expenditure and Lessee shall only be obligated to pay, each month during the remainder of the term of this Lease or any extension thereof, on the date that on which the Base Rent is due, an amount equalto 1/144th of the partion of such costs reasonably attributable to the Premises. Lessee shall pay Interest on the balance but may prepay its obligation at any time. If, however, such Capital Expenditure is required during the last 2 years of this Lease or if Lessorreasonably determines that it is not economically feasible to pay its share thereof, Lessor shall have the option to terminate this Lease upon 90 days prior written notice to Lessee unless Lessee notifies Lessor, in writing, within 10 days after receipt of Lessor's termination notice that Lessee will pay forsuch Capital Expenditure. If Lessor does not elect to terminate, and fails to tender its share of anysuch Capital Expenditure, Lessee may advance such funds and deduct same, with Interest, from Rent until Lessor's share of such costs have been fully paid. If Lessee is unable to finance Lessor's share, or if the balance of the Rent due and payable for the remainder of this Lease is not sufficient to fully reimburse Lessee on an offset basis, Lessee shall have the right to terminate this Lease upon 30 days written notice to Lessor. {c) Notwithstanding the above, the provisions concerning Capital Expenditures are intended to apply only to non-voluntary, unexpected, and new Applicable Requirements. If the Capital Expenditures areinstead triggered by Lessee as a result of an actual or proposed change in use, change in intensity of use, or madification to the Premises then, and in that event, Lessee shall either: (i} immediately cease such changed use or intensity of use and/or take such other steps as may be necessaryto eliminate the requirement for such Capital Expenditure, or (ii) complete such Capital Expenditure at its own expense. Lesseeshall not have any right to terminate this Lease. 2.4 Acknowledgements. Lessee acknowledges that: (a)it has been given an opportunity to inspect and measure the Premises, {b) it has been advised by Lessor and/or Brokers to satisfy itself with respect to the size and condition of the Premises {including but not limited to the electrical, HVAC and fire sprinkler systems, security, environmental aspects, and compliance with Applicable Requirements and the Americans with Disabilities Act), and their suitability for Lessee's intended use, (c) Lessee has made such investigation'as it deems necessary with reference to such matters and assumes all responsibility therefor as the same relate to its occupancy of the Premises, (d} it is not relying on any representation as to the size of the Premises made by Brokers or Lessar, () the square footage of the Premises was not material to Lessee's decision to lease the Premises and pay the Rent stated herein, and (f) neither Lessor, Lessor's agents, nor Brokers have made any oral or wrmanrepresentahons or warranues thh respect to sand matters other than asset forth in thiS Lease Mmmmdmwkdgewm 2.5 Lessee as Prior Owner/Occupant. The warranties made by Lessor in Paragraph 2 shall be of no force or effect if immediately prior to the Start Date Lessee was the owner or occupant of the Premises. Insuch event, Lessee shall be respansible for any necessary corrective work. 2.6 Vehicle Parking. Lesseeshall be entitled to use the number of Parking Spaces spemfled in Paragraph 1.2(b) onthose portions of the Common Areas designated from time to time by Lessor for parking. Lessee shall riot use more parking spaces than said number. Said parking spaces shall be used for parking by vehicles no farger than full-size passenger automobiles or pick-up trucks, herein called "Permitted Size Vehicles.” Lessor mayregulate the loading and unloading of vehicles by adopting Rules and Regulations as provided in Paragraph 2.9. No vehicles other than Permitted Size Vehicles maybe parked in the Common Area wmmut the prior written permission of Lessor. In addition: _,_L . K. j Page 2 of 17 : INNJALS Last Edited: 6/12/2018 4:00 PM INITIALS © 2017 AIR CRE. AllRights Reserved. MTN-26.10, Revised 11-01-2017 DocuSign Envelope ID: 2BAC34A2-B586-4C67-BA24-6ABBAOFBCF43 (a) Lessee shall not permit or allow any vehicles that belang to or are controlled by Lessee or Lessee’s employees, suppliers, shippers, customers, contractors or invitees to be loaded, unloaded, or parked in areas other than those designated by Lessor for such activities. (b) Lesseeshall not service or store any vehicles in the Common Areas. (c) IfLessee permits or allows any of the prohibited activities described in this Paragraph 2.6, then Lessor shall have the right, without notice, in addition to such other rights and remedies that it may have, to remove or tow away the vehicle involved and charge the cost to Lessee, which cost shall be immediately payable upon demand by Lessor. 2.7 Common Areas - Definition, The term "Common Areas” is defined as all areas and facilities outside the Premises and within the exterior boundary line of the Project and interior utility raceways and installations within the Unit that are provided and designated by the Lessor from time to time for the general non-exclusive use of Lessor, Lessee and other tenants of the Project and their respective employees, suppliers, shippers, customers, contractors and invitees, including parking areas, loading and unloading areas, trash areas, roofs, roadways, walkways, driveways and landscaped areas. 2.8 Common Areas - Lessee’s Rights. Lessor grants to Lessee, far the benefit of Lessee and its employees, suppliers, shippers, contractors, customers and invitees, during the term of this Lease, the nan-exclusive right to use, in common with others entitled to such use, the Common Areas as they exist from time to time, subject to any rights, powers, and privileges reserved by Lessor under the terms hereof or under the terms of any rules and regulations or restrictions governing the use of the Project. Under no circumstances shall the right herein granted to use the Common Areas be deemed to include the right to store any property, temporarily or permanently, in the Common Areas. Any such storage shall be permitted only by the prior written consent of Lessor or Lessor's designated agent, which consent may be revoked at any time. Inthe event that any unauthorized storage shall occur, then Lessor shall have the right, without notice, in addition to such other rights and remedies that it may have, to remove the property and charge the cost to Lessee, which cost shall be immediately payable upon demand by Lessor. 2.9 Common Areas - Rules and Regulations. Lessor or such other person(s) as Lessor may appoint shall have the exclusive control and management of the Common Areas and shall have the right, from time to time, to establish, modify, amend and enforce reasonable rules and regulations (“Rules and Regulations") for the management, safety, care, and cleanliness of the grounds, the parking and unloading of vehicles and the preservation of good order, as well as for the convenience of other occupants or tenants of the Bullding and the Project and their invitees. Lessee agrees to abide by and conform to all such Rules and Regulations, and shall use its best efforts to cause its employees, suppliers, shippers, customers, contractors and invitees to so abide and conform. Lessor shall not be responsible to Lessee for the non-compliance with said Rules and Regulations by other tenants of the Project. 2.10 Common Areas - Changes. Lessor shall have the right, in Lessor’s sole discretion, from time to time: (3) To make changes to the Common Areas, including, without limitation, changes in the location, size, shape and number of driveways, entrances, parking spaces, parking areas, loading and unloading areas, ingress, egress, direction of traffic, landscaped areas, walkways and utility raceways; (b) To close temporarily any of the Common Areas for maintenance purposes so long as reasonable access to the Premises remains available; (c) Todesignate other land outside the boundaries of the Project to be a part of the Common Areas; (d) Toadd additional buildings and improvementsto the Common Areas; ({e) To usethe Common Areas while engaged in making additional improvements, repairs or alterations to the Project, or any portion thereof; and (f) To doand perform such other acts and make such other changes in, to or with respect to the Common Areas and Project as Lessor may, in the exercise of sound business judgment, deem to be appropriate. 3. Term. 3.1 Term. The Commencement Date, Expiration Date and Original Term of this Lease are as specified in Paragraph 1.3. 3.2 Early Possession. Any provision herein granting Lessee Early Possession of the Premises is subject to and conditioned upon the Premises being available for such possession prior to the Commencement Date. Any grant of Early Possession only conveys a non-exclusive right to occupy the Premises. If Lessee totally or partially occupies the Premises prior to the Commencement Date, the obligation to pay Base Rent shall be abated for the period of such Early Possession. All other terms of this Lease (including but not limited to the obligations to pay Lessee's Share of Common Area Operating Expenses, Real Property Taxes and insurance premiums and to maintain the Premises) shall be in effect during such period. Anysuch Early Possession shall not affect the Expiration Date. 3.3 Delay InPossession. Lessor agrees to use its best commercially reasonable efforts to deliver possession of the Premises to Lessee by the Commencement Date. If, despite said efforts, Lessor is unable to deliver possession by such date, Lessor shall not be subject to any liability therefor, nor shall such failure affect the validity of this Lease or change the Expiration Date. Lessee shall not, however, be obligated to pay Rent or perform its other obligations until Lessor delivers possession of the Premises and any period of rent abatement that Lessee would otherwise have enjoyed shall run from the date of delivery of possession and continue for a period equal to what Lessee would otherwise have enjoyed under the terms hereof, but minus any days of delay caused by the acts or omissions of Lessee. If possession is not delivered within 60 days after the Commencement Date, as the same may be extended under the terms of any Work Letter executed by Parties, Lessee may, at its option, by notice in writing within 10 days after the end of such 60 day period, cancel this Lease, in which event the Parties shall be discharged from all obligations hereunder. If such written notice is not recelved by Lessor within said 10 day period, Lessee's right to cancel shall terminate. If possession of the Premises is not delivered within 120 days after the Commencement Date, this Lease shall terminate unless other agreements are reached between Lessor and Lessee, in writing. 3.4 Lessee Compliance. Lessor shall not be required to tender possession of the Premises to Lessee until Lessee complies with its obligation to provide evidence of insurance (Paragraph 8.5). Pending delivery of such evidence, Lessee shall be required to perform all of its obligations under this Lease from and after the Start Date, including the payment of Rent, notwithstanding Lessor's election to withhold possession pending receipt of such evidence of insurance. Further, if Lessee is required to perform any other conditions prior to or concurrent with the Start Date, the Start Date shall occur but Lessor may elect to withhold possession until such conditions are satisfied. 4. Rent. 4.1. RentDefined. Allmonetary obligations of Lessee to Lessor under the terms of this Lease (except for the Security Deposit) are deemed to be rent ("Rent”). 4.2 Common Area Operating Expenses. Lessee shall pay to Lessor during the term hereof, in addition to the Base Rent, Lessee's Share (as specified in Paragraph 1.6) of all Common Area Operating Expenses, as hereinafter defined, during each calendar year of the term of this Lease, in accordance with the following provisions: {a) “Common Area Operating Expenses" are defined, for purposes of this Lease, as all costs relating to the ownership and operation of the Project, including, but not limited to, the following: (i) The operation, repair and maintenance, in neat, clean, good order and condition , and if necessary the replacement, of the following: (aa) The Common Areas and Common Area improvements, including parking areas, loading and unloading areas, trash areas, roadways, parkways, walkways, driveways, landscaped areas, bumpers, irrigation systems, Common Area lighting facilities, fences and gates, elevators, raofs, exterior walls of the buildings, building systems and roof drainage systems. (bb) Exterior signs and any tenant directories. (cc) Any fire sprinkler systems. o T K j Page 3 of 17 IN Last Edited: 6/12/2018 4:00 PM INITIALS © 2017 AIR CRE. AllRights Reserved. MTN-26.10, Revised 11-01-2017 DocuSign Envelope ID: 2BAC34A2-B586-4C67-BA24-6AB6A0OFSCF43 {dd) All other areas and improvements that are within the exterior boundaries of the Project but outside of the Premises and/or any other space occupied by a tenant. (ii) The cost of water, gas, electricity and telephone to service the Common Areas and any utilities not separately metered. {iii} The cost of trash dispasal, pest control services, property management, security services, owners' asscciation dues and fees, the cost to repaint the exterior of any structures and the cost of any environmental inspections. (iv} Reserves set aside for maintenance, repair and/or replacement of Common Area improvements and equipment. (v} Real Property Taxes {as defined in Paragraph 10). (vi) The cost of the premiums for the insurance maintained by Lessor pursuant to Paragraph 8. (vii) Any deductible portion of an insured loss concerning the Building or the Common Areas. (viii) Auditors’, accountants' and attorneys’ fees and costs related to the operation, maintenance, repair and replacement of the Project. {ix) The cost of any capital improvement to the Building or the Project not covered under the provisionsof Paragraph 2.3 provided; however, that Lessor shall allocate the cost of any such capital improvement over a 12 year period and Lessee shall not be required to pay more than Lessee's Share of 1/144th of the cost of such capital improvement in any given month. Lessee shall pay Interest on the unamortized balance but may prepay its obligation atany time. {x) The cost of any other services to be provided by Lessor that are stated elsewhere in this Lease to be a Common Area Operating Expense. (xi) Costs of painting the exterior of any buildings in the Project and any costs to maintain, repair, replace, and restripe any parking arcas. (b) AnyCommon Area Operating Expenses and Real Property Taxes that are specifically attributable to the Unit, the Building or to any other building in the Project or to the operation, repair and maintenance thereof, shall be allocated entirely to such Unit, Building, or other building at Lessot’s election. However, any Common Area Operating Expenses and Real Property Taxes that are not specifically attributable to the Building or to any ather building or to the operation, repair and maintenance thereof, shall be equitably allocated by Lessor to all buildings in the Project. {c) Theinclusion of the improvements, facilities and services set forth in Subparagraph 4.2(a) shall not be deemed to impose an obligation upon Lessor to either have said improvements or facilities or to provide those services unless the Project already has the same, Lessor already provides the services, or Lessor has agreed elsewhere in this Lease to provide the same or some of them. (d) Lessee's Share of Common Area Operating Expenses is payable monthly on the same day as the Base Rent is due hereunder. The amount of such payments shall be based on Lessor's estimate of the annual Common Area Operating Expenses. Within 60 days after written request (but not more than once each year) Lessor shall deliver to Lessee a reasonably detailed statement showing Lessee's Share of the actual Common Area Operating Expenses for the preceding year. If Lessee's payments during such year exceed Lessee's Share, Lessor shall credit the amount of such over-payment against Lessee's future payments. If Lessee’s payments during such year were less than Lessee’s Share, Lessee shall pay to Lessor the amount of the deficiency within 30 38 days after delivery by Lessor to Lessee of the statement. (e} Common Area Operating Expenses shall not include any expenses paid by any tenant directly to third parties, or as to which Lessor is otherwise reimbursed by any third party, other tenant, or insurance proceeds. 4.3 Payment. Lessee shall cause payment of Rent to be received by Lessor in lawful money of the United States, without offset or deduction (except as specifically permitted in this Lease), on or before the day on which it is due. All monetary amounts shall be rounded to the nearest whole dollar. In the event that any invoice prepared by Lessor is inaccurate such inaccuracy shall not constitute a waiver and Lessee shall be obligated to pay the amount set forth in this Lease. Rent for any period during the term hereof which is for less than one full calendar manth shall be prorated based upon the actual number of days of said month. Payment of Rent shall be made to Lessor at its address stated herein or to such other persans or place as Lessor may from time to time designate in writing. Acceptance of a payment which is less than the amount then due shall not be 3 waiver of Lessor's rights to the balance of such Rent, regardless of Lessor's endorsement of any check sostating. In the event that any check, draft, or other instrument of payment given by Lessee to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor the sum of $25 in addition to any Late Charge and Lessor, at its option, may require all future Rent be paid by cashier's check. Payments will be applied first to accrued late charges and attorney’s fees, second to accrued interest, then to Base Rent and Common Area Operating Expenses, and any remaining amount to any other outstanding charges or costs. 5. Security Deposit. Lessee shall deposit with Lessor upon execution hereof the Security Deposit as security for Lessee’s faithful performance of its obligations under this Lease. If Lessee fails to pay Rent, or otherwise Defaults under this Lease, Lessor may use, applyor retain all or any portion of said Security Deposit for the payment of any amount already due Lessor, for Rents which will be due in the future, and/ or to reimburse or compensate Lessor for any liability, expense, loss or damage which Lessor may suffer or incur by reason thereof. If Lessor uses or applies all or any portion of the Security Deposit, Lessee shall within 10 days after written request therefor deposit monies with Lessor sufficient to restore said Security Deposit to the full amgunt required by this Lease. If the Base Rent increases during the term of this Lease, Lessee shall, upon written request from Lessor, deposit additional monies with Lessorso that the total amount of the Security Deposit shall at all times bear the same proportion to the increased Base Rent as the initial Security Deposit bore to the initial Base Rent. Should the Agreed Use be amended to accommodate a material change in the business of Lessee or to accommodate a sublessee or assignee, Lessor shall have the right to increase the Security Deposit to the extent necessary, in Lessor's reasonable judgment, to account for any increased wear and tear that the Premises may suffer as a result thereof. If a change in control of Lessee occurs during this Lease and following such change the financial condition of Lessee is, in Lessor’s reasonable judgment, significantly reduced, Lessee shall deposit such additional monies with Lessor as shall be sufficient to cause the Security Deposit to be at a commercially reasonable level based on such change in financial condition. Lessor shall not be required to keep the Security Deposit separate fromits general accounts. Within S0 days after the expiration or termination of this Lease, Lessor shall return that portion of the Security Depasit not used or applied by Lessor. Lessor shall upon written request provide Lessee with an accounting showing how that portion of the Security Deposit that was not returned was applied. No part of the Security Deposit shall be considered to be held in trust, to bear interest or to be prepayment for any monies to be paid by Lessee under this Lease. THE SECURITY DEPOSIT SHALL NOT BE USED BY LESSEE IN LIEU OF PAYMENT OF THE LAST MONTH'S RENT. 6. Use. 6.1 Use. Lessee shall use and occupy the Premises only for the Agreed Use, or any other legal use which is reasonably comparable thereto, and for no other purpose. unless expressly consented to in writing. which consent Lessor may give or withhold in its sole and absolute discretion. Lessee shalt not use or permit the use of the Premises in a manner that is unlawful, creates damage. waste or a nuisance, or that distur