Preview
CHARLES M. CLARK (SBN 244535)
clark@jacksontidus.law
JOSHUA J. ANDERSON (SBN 279170) E-FILED
janderson@jacksontidus.law 5/2/2024 10:24 AM
Superior Court of California
JACKSON TIDUS, A Law Corporation County of Fresno
2030 Main Street, Suite 1500 By: Rosa Garza, Deputy
Irvine, California 92614
(949) 752-8585
Attorneys for Plaintiff
Left Mendota I, LLC
SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF FRESNO
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11 LEFT MENDOTA I, LLC, a Delaware CASENO. 24CECG01800
limited liability company,
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Plaintiff, VERIFIED COMPLAINT FOR
13 UNLAWFUL DETAINER
vs.
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CLEARVIEW MANAGEMENT
15 SOLUTIONS, LLC, a California limited
liability company; THE PACK
16 COMPANY, LLC; and DOES 1 to 50,
inclusive,
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Defendants.
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VERIFIED COMPLAINT FOR UNLAWFUL DETAINER
Plaintiff Left Mendota I, LLC alleges as follows:
THE PARTIES
1 At all relevant times, Plaintiff Left Mendota I, LLC (“Plaintiff”) is and was a
Delaware limited liability company doing business in Fresno County, California.
2. Plaintiff is the owner of the property located at 1269 Marie Street, Suite 6,
Mendota, California 93640 (“Premises”) which is located in this Court’s judicial district.
3 Plaintiff is informed and believes, and based thereon alleges, that at all relevant
times, Clearview Management Solution, LLC (“Defendant”) is and was a California limited
liability company doing business in Fresno County, California.
10 4 Plaintiff is informed and believes, and based thereon alleges, that at all relevant
11 times, The Pack Company, LLC (“Defendant Guarantor”) is and was a California limited
12 liability company doing business in Fresno County, California.
13 5 Plaintiff does not know the true names and capacities of the defendants named as
14 DOES | through 50, inclusive. Plaintiff will seek leave to amend this Complaint to allege their
15 names and capacities when ascertained.
16 6. Plaintiff is informed and believes, and based thereon alleges, that the defendants
17 designated as DOES 1 through 50, inclusive, are persons or entities in some way responsible for
18 the acts or omissions alleged, that they have some right, title or interest in the subject matter of
19 this action, or that they are otherwise required to be joined as a party in order for Plaintiff to
20 obtain all the relief to which it is entitled. Moreover, Plaintiff is informed and believes, and
21 based thereon alleges, that each of the defendants, including the defendants served as DOE,
22 claim some type of possessory interest in and to the Premises.
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23 Each defendant, including the DOE defendants, was and is the agent, employee,
24 employer, affiliate, representative, alter ego, subsidiary, affiliate and/or partner of one or more of
25 the other defendants, and was, in performing the acts complained of, acting within the scope of
26 such agency, employment, or is in some other way responsible for the acts of one or more of the
27 defendants.
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VERIFIED COMPLAINT FOR UNLAWFUL DETAINER
THE LEASE
8 On or about December 18, 2018, Plaintiff executed a Lease Agreement with
Defendant to occupy and conduct business at the Premises (the Lease, and any amendments
thereto shall be referred to as the “Lease”). An accurate copy of this Lease and amendments
thereto are attached as Exhibit 1 and incorporated by this reference as if fully set forth herein.
9. Plaintiffas Landlord has all rights and remedies under the Lease.
10. On or about December 17, 2018, Defendant Guarantor entered into a Guaranty
Agreement with Plaintiff in which Defendant Guarantor agreed to guaranty all of Defendant’s
monetary obligations under the Lease. (/d.)
10 NOTICE TO PAY RENT OR QUIT
11 11. Defendant, Defendant Guarantor and any other occupants were properly served
12 on April 15, 2024, with a Five (5) Day Notice to Pay Rent or Quit (“Notice to Pay Rent or Quit”)
13 under California Code of Civil Procedure Section 1161.1, et seq. that demanded Defendant
14 immediately pay the outstanding balance of $33,184.23 for April 2024 Rent. An accurate copy
15 of the Notice to Pay Rent or Quit is attached as Exhibit 2 and incorporated by this reference as if
16 fully set forth herein.
17 12. All facts stated in the Notice to Pay Rent or Quit were true at the time it was
18 served.
19 13. The Notice to Pay Rent or Quit included an election of forfeiture.
20 14. The period stated in the Notice to Pay Rent or Quit expired. Defendant and
21 Defendant Guarantor failed to play the outstanding rent balance of $33,184.23.
22 15. Plaintiff has performed all conditions, covenants and promises required of it by
23 the Lease except those, if any, that were waived and excused by Defendants’ conduct.
24 16. Defendant continues to occupy the Premises and refuses to surrender possession
25 to Plaintiff.
26 REMEDIES AND DAMAGES
27 17. Defendant improperly maintains possession of the Premises. The possession is
28 without Plaintiff's permission or consent. Plaintiff is entitled to immediate possession of the
3- 1631802.1
VERIFIED COMPLAINT FOR UNLAWFUL DETAINER
Premises, so Defendant must immediately vacate the Premises and possession must be returned
to Plaintiff.
18. The fair rental value of the Premises shall be established according to proof, but is
estimated to be at least $1,106.14 per day.
19. Section 22.04 of the Lease provides for the recovery of reasonable attorneys’ fees
incurred by Plaintiff in recovering possession of the Premises.
20. Plaintiff accepts the jurisdictional limit, if any, of the Court.
UNLAWFUL DETAINER ASSISTANT (Bus. & Prof. Code, §§ 6400-6415)
21. An unlawful detainer assistant did not for compensation give advice or assistance
10 with this pleading.
11 PRAYER
12 WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as
13 follows:
14 (a) immediate possession of the Premises;
15 (b) forfeiture of the Lease;
16 (d) damages at the rate of $1,106.14 per day from April 20, 2024 for each day
17 Defendant remains in possession through entry of judgment;
18 (e) costs incurred in this action;
19 (f) reasonable attorneys’ fees; and,
20 (g) such other and further relief as the Court deems proper.
21 DATED: April 30, 2024 JACKSON TIDUS, A Law Corporation
22 a
B
23 ” Charles M. Clark
Attorneys for Left Mendota I, LLC
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4. 1631802.1
VERIFIED COMPLAINT FOR UNLAWFUL DETAINER
DocuSign Envelope 1D: 0A7F82E4-E304-483C-812C-461E2972633A
VERIFICATION
I, Ben Kriger, declare as follows:
Tam an authorized agent of Left Mendota I, LLC, the owner of property located at 1269
Marie Street, Suite 6, California 93640 (“Premises”). In such capacity, I have personal
knowledge of the actions taken with respect to the Premises. I have read the foregoing Summons
and Complaint for Unlawful Detainer and know the contents thereof. I certify that the same is
true from my own knowledge in the capacity described above, except as to those matters stated
upon information and belief, and as to those matters I believe them to be true.
I declare under penalty of perjury under the laws of the State of California that the
10 foregoing is true and correct.
11 Executed on this 30th day of April 30, 2024, at Chicago, Illinois.
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DocuSigned by:
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A
B1GAEFRC?RE341
14 Ben Kriger
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-l- 1631802.1
VERIFICATION
5.
EXHIBIT 1
COMMERCIAL LEASE BETWEEN
MARIE STREET DEVELOPMENT, LLC (LANDLORD)
AND
CLEARVIEW MANAGEMENT SOLUTIONS, LLC (TENANT)
Property: Mendota
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TABLE OF CONTENTS
ARTICLE IBASIC LEASE PROVISIONS
ARTICLE !IIDEFINITIONS.
ARTICLE IIIPREMISES ..
ARTICLE |VPAYMENT OF BASE RENT AND ADDITIONAL RENT 11
ARTICLE VOPERATING EXPENSES 12
ARTICLE VITAXES 17
ARTICLE VIIDEPOSITS. 18
ARTICLE VIIICANNABIS COMPLIANCE 19
ARTICLE IXUSE 22
ARTICLE XHAZARDOUS MATERIALS. 23
ARTICLE XIPARKING 25
ARTICLE XISERVICES AND UTILITIES 25
ARTICLE XIIIMAINTENANCE, REPAIRS AND ALTERATIONS 25
ARTICLE XIVTRADE FIXTURES 27
ARTICLE XYCOVENANT AGAINST LIENS. 28
ARTICLE XVIRULES AND REGULATIONS 29
ARTICLE XVIIASSIGNMENT AND SUBLEASING 29
ARTICLE XVIITNSURANCE AND INDEMNIFICATION. 32
ARTICLE XIXCERTIFIED ACCESS SPECIALIST 35
ARTICLE XXDAMAGE AND DESTRUCTION 35
ARTICLE XXIEMINENT DOMAIN.. 37
ARTICLE XXIIDEFAULTS AND REMEDIES 37
ARTICLE XXIIIPROTECTION OF LENDERS 41
ARTICLE XXIVWAIVER OF CLAIMS 43
ARTICLE XXVWAIVER OF NOTICE 43
Lease Agreement
Table of Contents
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ARTICLE XXVINOTICES 43
ARTICLE XXVIIBROKERS 44
ARTICLE XXVIIIQUIET ENJOYMENT 44
ARTICLE XXIXEND OF TERM 45
ARTICLE XXXGUARANTOR 45
ARTICLE XXXIDISPUTE RESOLUTION 45
ARTICLE XXXIICONFIDENTIALITY .. 46
ARTICLE XXXIIIMISCELLANEOUS PROVISIONS. 47
ARTICLE XXXIVRENEWAL TERM 49
Lease Agreement
Table of Contents
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This LEASE AGREEMENT ("Lease"), dated as of the Effective Date, is by and
between Landlord and Tenant, as defined herein.
ARTICLE I
BASIC LEASE PROVISIONS
Each reference in this Lease to the “Basic Lease Provisions” shall mean and refer to the
following collective terms, the application of which shall be governed by the provisions in the
remaining Articles of this Lease.
Section 1.01 Landlord’s Name: Marie Street Development, LLC, a Delaware limited
liability company
Section 1.02 Tenant’s Name: Clearview Management Solutions, LLC, a California
limited liability company
Section 1.03 Effective Date: December 18, 2018
Section 1.04 Address for Payments and Notices:
LANDLORD TENANT
Marie Street Development, LLC Clearview Management Solutions, LLC
2448 Fillmore St., #380-3336 315 W. 9% St., Ste. 400
San Francisco, CA 94115 Los Angeles, CA 90015
Attn: Mr. Jonathan Charak Attn: Ben Catt
jonathan@canna-hub.com ben@dompen.co
With a copy to: With a copy to:
Attn: Mr. Thom Ferguson Attn: Hilary Bricken
Ferguson Corporate Law, Ltd. Harris Bricken McVay Sliwoski, LLP
PO Box 102 120 Green Street, Suite 300
Libertyville, IL 60048 San Francisco, CA 94111
thom@fergusoncorplaw.com hilary@harrisbricken.com
Lease Agreement
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Section 1.05 Land: The Land is known as Canna-Hub Mendota, located upon
Assessor Parcel Numbers 013-280-15, 013-280-228, 013-280-148, 013-280-19, 013-280-
21S. The Legal Description of the Land attached as Exhibit A to this Agreement.
Section 1.06 Building: The Building shall mean the improvements in which the
Premises are located, having a street address of 1269 Marie Street, Mendota, CA 93640
and shown in the Floor Plan.
Section 1.07 Premises shall mean approximately 6,200 square feet located in the
Building, identified as Suite # 6 on Exhibit B, including all improvements therein or to be
provided by Landlord under the terms of this Lease and being the space cross hatched on
the Floor Plan attached hereto and made a part hereof. Tenant acknowledges that in
determining the number of square feet of space in the Premises, all distances have been
measured from the exterior face of all exterior walls and the center of all partition walls
which separate the Premises from any interior area.
Section 1.08 Base Rent: Subject to Section 4.02(b) hereof, for the period
commencing on the Rent Commencement Date and ending 12 months thereafter, a
monthly lease rate of $3.00 per square foot, or a total amount of $18,600 per month, with
increases in the amount of 3% each year on the anniversary of the Commencement Date.
Section 1.09 Most Favored Nation Pricing: During the Primary Lease Term, to the extent that
another lease (“Other Lease’) is executed for any other suite located within the Building Complex that is
(a) owned by Landlord or any of its Affiliates, (b) not more than 7,000 of rentable square feet in a
similar type structure (i.e. not a greenhouse space), (c) is leased for a Primary Lease Term of four (4)
years or less, and (d) the combined starting Base Rent and Additional Rent for the Other Lease is less
than the current combination of Base Rent rate and Additional Rent rate for Tenant under this Lease at
the time the Other Lease is executed, then Landlord will notify Tenant within five (5) business days after
execution of the Other Lease and amend this Lease such that Tenant shall receive the same lower
combination of Base Rent rate and Additional Rent rate for a period equal to the term of the Other Lease
or the remainder of the Primary Lease Term, whichever is sooner and Tenants reduced combination of
Base Rent and Additional Rent shall commence upon the Rent Commencement Date of the Other Lease.
The Tenant may also elect to reduce the Primary Lease Term to a period that is equal to the Primary
Lease Term of the Other Lease. For the avoidance of doubt, there will be no credit provided to the
Tenant for any period of time prior to the Rent Commencement Date of the Other Lease. Further,
Tenant acknowledges that this Section 1.09 shall apply exclusively to the Primary Lease Term, and it is
not intended to survive into any Renewal Term.
Section 1.10 Estimated Commencement Date: on or before January 15,2019
Section 1.11 Rent Commencement Date: upon the earlier of the issuance of Tenant’s
post-buildout Certificate of Occupancy from the Local Authority, or 60 days after the
Commencement Date.
Lease Agreement
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Section 1.12 Primary Lease Term: 48 months from the first day of the calendar month
following the Commencement Date.
Section 1.13 Deposits. A deposit representing 2 months of rent, or $37,200
(“Security Deposit”), as well as a deposit representing a single quarterly payment of the
Local Permit Fee, or $12,400 (‘Local Permit Fee Deposit”), shall be deposited by Tenant in
accordance with ARTICLE VII hereof.
Section 1.14 Renewal Option: One 36-month period
Section 1.15 Permitted Use shall only mean the uses specifically identified as
permitted below, to be interpreted consistent with the Medicinal and Adult-Use Cannabis
Regulation and Safety Act and successor statutes, along with such reasonably-related
ancillary uses such as general office use (which ancillary uses shall not include any
Commercial Cannabis Activity):
License Description State License Type(s) Adult Use Medicinal
Permitted Permitted
Distribution 11 Yes Yes
Manufacturing Volatile using only 7 Yes Yes
the following solvents:
Butane
Hexane
Propane
Subject to Volatile Extraction
Addendum, Attached as Exhibit G
Section 1.16 Guarantor(s) The Pack Company, LLC, a California LLC
Section 1.17 Landlord’s Broker: None
Section 1.18 Tenant’s Broker: None
ARTICLE II
DEFINITIONS
Section 2.01 Definitions. The terms defined in this ARTICLE II shall have the
following meanings whenever used in this Lease:
Lease Agreement
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"Additional Rent" shall mean all monetary obligations, other than Base Rent, of
Tenant to Landlord under the terms of this Lease, whether or not specified as Additional
Rent herein.
"Address of Landlord for Notices" shall have the meaning shown in the Basic Lease
Provisions, or such address as Landlord shall subsequently designate in writing.
"Address of Tenant for Notices" shall have the meaning shown in the Basic Lease
Provisions, or such address as Tenant shall subsequently designate in writing.
"ADA" shall mean the Americans with Disabilities Act of 1990, (42 U.S.C. §§ 12101
to 12213), as amended by the Americans with Disabilities Act Amendments of 2008 (Pub.
L. No. 110-325).
"Assignment" and "Assignee" shall have the meaning set forth in Section 17.01
hereof.
"Base Rent" shall have the meaning shown in the Basic Lease Provisions.
"Binding Renewal Notice" shall have the meaning set forth in Section 34.03 hereof.
"Brokers" shall mean, collectively, the Landlord's Broker and the Tenant's Broker.
"Building" shall have the meaning shown in the Basic Lease Provisions.
"Building Complex" shall mean the Premises, the Building and the Common Areas,
together with all other existing and future buildings and improvements erected on the
Land.
"Certificate of Occupancy" shall mean the certificate issued by the building
department of the city where the Land is located, in certifying that the Premises have
been improved in compliance with all applicable Laws and the Premises are in a condition
suitable for occupancy.
“Commercial Cannabis Activity” shall have the definition supplied by California
Business & Professions Code Section 26001, as amended from time to time.
"Commencement Date" shall mean the date on which Landlord delivers the
Premises as specified in Section 3.02 for Tenant’s buildout of the Premises, and such date
is not tied to Tenant being able to use or occupy the Premises (other than for purposes of
Tenant’s buildout).
"Common Areas" shall mean all areas and facilities located outside of the Premises
and within the exterior boundary line of the Building Complex that are provided and
designated by the Landlord from time to time for the general non-exclusive use of
Lease Agreement
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Landlord, Tenant and other tenants of the Building Complex and their respective
employees, suppliers, shippers, customers, contractors and invitees, including, without
limitation, parking areas, loading and unloading areas, trash areas, lighting facilities,
fences and gates, roadways, sidewalks, walkways, parkways, driveways and landscaped
areas.
“Conditional Use Permit” shall mean that certain conditional use permit issued by
the City of Mendota to CHH, LLC (the owner of the Landlord) and attached hereto as
Exhibit I.
"Confidential Information" shall have the meaning set forth in Section 32.01hereof.
“Development Agreement” shall mean that certain development agreement between
Landlord and the City of Mendota attached hereto as Exhibit J.
“Deposit” shall mean the Security Deposit and the Permit Fee Deposit.
"Effective Date" shall have the meaning shown in the Basic Lease Provisions.
"Environmental Laws" shall mean all Laws: (a) relating to the environment, human
health or natural resources; (b) regulating, controlling or imposing liability or standards of
conduct concerning any Hazardous Materials: (c) relating to Remedial Actions: and (d)
requiring notification or disclosure of releases of Hazardous Materials or of the existence
of any environmental conditions on or at the Premises, as any of the foregoing may be
amended, supplemented, or supplanted from time to time.
"Estimated Commencement Date" shall have the meaning shown in the Basic Lease
Provisions.
"Event(s) of Default" shall have the meaning set forth in Section 22.02 hereof.
"Expiration Date" shall mean the last day of the month in which the period of the
Lease Term ends, with the Lease Term beginning to run with the Commencement Date, as
same may be extended pursuant to ARTICLE XXXIV hereof, or such earlier date on which
the Term shall sooner end pursuant to any of the terms, covenants or conditions of this
Lease or pursuant to Law.
"Guarantor(s) " shall have the meaning shown in the Basic Lease Provisions.
"Hazardous Materials" shall mean any pollutant or contaminant or hazardous,
dangerous or toxic chemicals, materials, or substances within the meaning of any
applicable Environmental Law relating to or imposing liability or standards of conduct
concerning any hazardous, toxic or dangerous waste substance or material, all as amended
or hereafter amended, including, without limitation, any material or substance which is:
(a) designated as a "hazardous substance" pursuant to Section 311 of the Federal Water
Lease Agreement
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Pollution Control Act (33 U.S.C. Section 1317); (b) defined as a "hazardous waste"
pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42 U.S.C.
Section 6901 et seq. (42 U.S.C. Section 6903); (c) defined as a "hazardous substance"
pursuant to Section 101 of the Comprehensive Environmental Response, Compensation
and Liability Act, 42 U.S.C. Section 9601 et seq. (42 U.S.C. Section 9601); (d) petroleum;
(e) asbestos or asbestos-containing materials; (f) polychlorinated biphenyls ("PCBs") or
substances or compounds containing PCBs; (g) radon: (h) medical waste; and (i) petroleum
products.
"Initial Renewal Notice" shall have the meaning set forth in Section 34.01 hereof.
"Interest Rate" shall mean the Prime Rate plus 5 percent (5% per annum but, in no
event, in excess of the maximum permissible interest rate then in effect in the State.
"Land" shall have the meaning shown in the Basic Lease Provisions.
"Landlord's Broker" shall have the meaning shown in the Basic Lease Provisions.
"Landlord’s Equipment" shall have the meaning set forth in Section 14.01.
"Landlord's Operating Expenses Statement " shall have the meaning set forth in
Section 5.05 hereof.
"Law" or “Laws” shall mean all laws, statutes and ordinances (including building
codes and zoning ordinances and regulations), rules, orders, directives and requirements
of all federal, state, county, municipal departments, bureaus, boards, agencies, offices,
commissions and other subdivisions thereof, or of any official thereof, or of any
governmental, public or quasi-public authority, whether now or hereafter in force, which
may be applicable to the Building Complex, the Building or the Premises or any part
thereof, including, without limitation, the ADA and the OSH Act, and any reciprocal
easement, covenant, restriction, or other agreement, restriction of easement of record
affecting the Building Complex as of the date of this Lease or subsequent thereto. “Law”
shall exclude all federal laws, including without limitation the Controlled Substances Act,
to the extent they are inconsistent or in conflict with Tenant’s use of the Premises for the
Permitted Use in compliance with State and Local Authority laws.
"Lease Renewal Amendment" shall have the meaning set forth in Section 34.03(c)
hereof.
“Local Authority” shall mean the government of the city where the Land is located,
including all departments and agencies thereof.
“Local Permit Fee” shall mean Tenant’s Percentage of the actual fees paid by
Landlord to the Local Authority as the square foot charge for the Premises payable under
the Development Agreement with the City of Mendota. The Local Permit Fee shall be a
Lease Agreement
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direct dollar-for-dollar pass through to Tenant based on Tenant’s Percentage of actual fees
paid by Landlord.
“Local Permit Fee Deposit " shall have the meaning shown in the Basic Lease
Provisions.
"Operating Expenses" shall have the meaning set forth in Section 5.01 hereof.
"OSH Act" shall mean the Occupational Health and Safety Act (29 U.S.C. §§ 651 to
678), as amended from time to time.
"Permitted Use" shall have the meaning shown in the Basic Lease Provisions.
"Premises" shall have the meaning shown in the Basic Lease Provisions.
"Prevailing Market Rental Rate" shall have the meaning set forth in Section 34.04
hereof.
"Primary Lease Term" shall mean the initial term of this Lease commencing on the
Commencement Date and ending on the Expiration Date.
"Prime Rate" shall mean the prime or base rate announced as such from time to
time by Bank of America, and if not available, a comparable rate announced by another
national bank selected by Landlord. Any interest payable under this Lease with reference
to the Prime Rate shall be adjusted on a daily basis, based upon the Prime Rate in effect
at the time in question, and shall be calculated on the basis of a 360-day year with twelve
(12) months of 30 days each.
"Property Manager" shall mean an individual or entity designed in writing by
Landlord.
"Purpose" as used in ARTICLE XXXII only shall have the meaning set forth in
Section 32.02.
"Real Estate Taxes" shall mean any form of real estate tax or assessment, general,
special, ordinary or extraordinary imposed upon the Building Complex or any portion
thereof by any authority having the direct or indirect power to tax, including any city,
state or federal government, or any school, sanitary, fire, street, drainage, or other
improvement district thereof, levied against any legal or equitable interest of Landlord in
the Building Complex or any portion thereof. The term "Real Estate Taxes" shall also
include any tax, fee, levy, assessment or charge, or any increase therein, imposed by
reason of events occurring, or changes in applicable zoning, municipal, county, state and
federal laws, ordinances and regulations and any covenants or restrictions of record taking
effect during the Term of this Lease, including but not limited to a change in ownership of
the Building Complex or the improvements thereon (or any portion thereof), the execution
Lease Agreement
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of this Lease, or any modification, amendment or transfer thereof, and whether or not
contemplated by the parties hereto.
"Rejection Notice" shall have the meaning set forth in Section 34.03 hereof.
"Remedial Action" shall mean the investigation, response, clean up, remediation,
prevention, mitigation or removal of any Hazardous Materials necessary to comply with
any Environmental Laws.
"Renewal Option" shall mean have the meaning set forth in Section 34.01 hereof.
"Renewal Term" shall have the meaning set forth in Section 34.01 hereof.
“Rent Commencement Date" shall have the meaning shown in the Basic Lease
Provisions.
"Rent Payment Address" shall mean the Landlord address shown in the Basic Lease
Provisions, or such address as Landlord shall subsequently designate in writing.
"Rent" shall mean Base Rent and Additional Rent.
"Representative" as used in ARTICLE XXXII only shall have the meaning set forth
in Section 32.01.
"Rules and Regulations" shall mean the rules and regulations governing the
Premises, the Building and the Building Complex, attached hereto as Exhibit C and made
a part hereof, as same may be amended from time to time.
"Security Deposit" shall have the meaning shown in the Basic Lease Provisions.
"State" shall mean the State of California.
"State Authorities" means the government of the State including all departments
and agencies thereof.
"Tenant Improvements" shall mean the improvements and alterations to the
Premises performed by or on behalf of Tenant.
"Tenant's Broker" shall have the meaning shown in the Basic Lease Provisions.
"Tenant's Contractor" shall have the meaning set forth in Section 3.03 hereof.
"Tenant's Percentage" shall mean a percentage derived by dividing the final
rentable square feet of the Premises as determined on the executed Commencement Date
Memorandum by the approximate rentable square feet in the Building Complex. Tenant
agrees that the square feet of floor area in the Premises and/or the Building Complex, the
Lease Agreement
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Base Rent, Tenant's Share of Operating Expenses and Tenant's Share of Real Estate
Taxes may be recalculated in the event the premises and/or the Building Complex are
remeasured by Landlord at any time during the Term and it is determined that the total
number of square feet of floor area in the premises and/or the Building Complex differs
from those set forth herein.
"Tenant's Share of Operating Expenses" shall mean Tenant's proportionate share of
Operating Expenses based on Tenant's Percentage.
"Tenant's Share of Real Estate Taxes" shall mean Tenant's proportionate share of
Real Estate Taxes based on Tenant's Percentage.
"Term" shall mean the Primary Lease Term and the Renewal Lease Term (provided
Tenant is entitled to and properly exercises the Renewal Option).
"Trade Fixture" shall have the meaning set forth in Section 14.01 hereof.
ARTICLE HI
PREMISES
Section 3.01 Lease of Premises for Lease Term. Subject to the terms and conditions
of this Lease, Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord,
the Premises for a Primary Lease Term that shall commence on the Commencement Date
and end on the Expiration Date (as such Primary Lease Term may be extended pursuant
to ARTICLE XXXIV hereof), subject to earlier termination pursuant to any of the terms,
covenants or conditions of this Lease or pursuant to Law. Promptly after the
Commencement Date, Landlord and Tenant shall execute a commencement date
agreement in the form attached hereto as Exhibit D acknowledging the Commencement
Date and the Expiration Date for the Primary Lease Term.
Section 3.02 Acceptance of Premises. Landlord will deliver the Premises as
specified in the “Work Letter” (Exhibit F), including with those (and only those) utility
services identified in the Work Letter. Tenant hereby acknowledges that: (a) Tenant will
have the opportunity to inspect the Premises prior to delivery of the Premises to Tenant
and will accept the Premises is its "AS IS, WHERE IS" condition; (b) the Premises is
acceptable for Tenant's intended Permitted Use: and (c) neither Landlord, Landlord's
Broker, nor any of Landlord's agents, has made any oral or written representations or
warranties with respect to said matters other than as set forth in this Lease. EXCEPT AS
EXPRESSLY SET FORTH IN THIS LEASE, TENANT ACCEPTS THE PREMISES IN
ITS "AS IS" CONDITION AND TENANT EXPRESSLY WAIVES ANY WARRANTY OF
CONDITION OR OF HABITABILITY OR SUITABILITY FOR OCCUPANCY, USE,
HABITATION, FITNESS FOR A PARTICULAR PURPOSE OR MERCHANTABILITY,
EXPRESS OR IMPLIED, RELATING TO THE PREMISES.
Lease Agreement
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Section 3.03 Initial Improvements. Following delivery of the Premises by Landlord
pursuant to the Work Letter, Tenant shall be responsible for making all improvements
desired by Tenant in connection with its initial occupancy (the “Initial
Improvements”). Tenant shall be required to complete the Initial Tenant Improvements
on or prior to the date Tenant opens for business in the Premises.
Section 3.04 Delay in Commencement. Landlord shall not be liable to Tenant if
Landlord does not deliver possession of the Premises to Tenant on the Estimated
Commencement Date and such failure to deliver the Premises shall not affect this Lease
or the obligations of Tenant hereunder. If Landlord does not deliver possession of the
Premises to Tenant within ninety (90) days after the Estimated Commencement Date,
Tenant may elect to cancel this Lease by giving written notice to Landlord within fifteen
(15) days after the ninety (90) day period ends. For purposes of Landlord delivering
possession of the Premises to Tenant, such delivery shall not mean the Premises are ready
for occupancy, but that Landlord has performed all of the Landlord’s Work pursuant to the
Work Letter and the Premises are delivered to Tenant in order for Tenant to perform the
remaining buildout. If Tenant gives such notice, this Lease shall be cancelled, effective
immediately, and neither Landlord nor Tenant shall have any further obligation to the
other. If Tenant does not give such notice within such specified time period, Tenant's right
to cancel the Lease shall expire and the Primary Lease Term shall commence upon the
delivery of possession of the Premises to Tenant.
Section 3.05 Common Areas. Landlord hereby grants to Tenant, for the benefit of
Tenant and its employees, suppliers, shippers, customers, contractors and invitees, during
the Term of this Lease, the nonexclusive 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 Landlord under the terms hereof or under the terms of any
Rules and Regulations governing the use of the Building Complex. Under no
circumstances shall the right granted herein be deemed to include the temporary or
permanent right to store any property in the Common Areas. Landlord shall have the
right, from time to time, to: (a) establish, modify, amend and enforce the Rules and
Regulations regarding the Common Areas, provided that any such modifications do not
require Tenant to pay any additional money; (b) make changes to the Common Areas,
including, without limitation, changes in the location, size, shape and number of
driveways, entrances, ingress, egress, direction of traffic, parking spaces, parking areas,
loading and unloading areas, landscaped areas and walkways, provided that any such
changes shall not materially interfere with Tenant’s use of the Premises: (c) close
temporarily any of the Common Areas for maintenance purposes so long as Tenant’s
reasonable access to the Premises remains available; (d) add additional buildings and
improvements to the Common Areas; and (e) do and perform such other acts and make
such other changes in, to, or with respect to the Common Areas and Building Complex as
Landlord may, in the exercise of sound business judgment, deem to be appropriate,
provided that any such changes shall not materially interfere with Tenant’s use of the
Premises. All parking areas, driveways, entrances and exits thereto, stairways, lobbies
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and all other Common Areas provided by Landlord for the general use in common by all
tenants in the Building Complex shall be at all times subject to the exclusive control and
management of Landlord.
ARTICLE IV
PAYMENT OF BASE RENT AND ADDITIONAL RENT
Section 4.01 Base Rent.
(a) Tenant covenants and agrees to pay base rent ("Base Rent") to
Landlord throughout the Primary Lease Term of this Lease in the amounts shown
in the Basic Lease Provisions.
(b) If Tenant is entitled to and properly exercises its Renewal Option in
accordance with the terms of ARTICLE XXXIV of this Lease, the Base Rent payable
with respect to the Renewal Term shall be an amount as determined pursuant to
Section 27.02 thereof.
Section 4.02 Time and Manner of Base Rent and Additional Rent Payments.
(a) Upon the Rent Commencement Date, Tenant shall pay Base Rent to
Landlord in equal monthly installments, in advance, commencing on the first day of
each month during the Term, without notice or demand.
(b) Base Rent shall be abated until the Rent Commencement Date, but
Tenant shall be obligated to pay Tenant’s Share of Operating Expenses beginning
on the Commencement Date, subject to subsection 4.02(d) below. Additionally,
Landlord shall provide to Tenant an allowance for the cost of Tenant’s desired
improvements in the amount of $3.00 per square foot, or $18,600.00 (the “Tenant
Improvement Allowance”). Landlord shall directly credit the Tenant Improvement
Allowance ratably ($3,100 per month) against Tenant’s Base Rent payment due
during the first six (6) months following the Rent Commencement Date.
(c) Base Rent due for any period of less than twelve (12) months (or any
monthly installment of Base Rent due for any period of less than a full month) shall
be appropriately apportioned based upon a 360-day year (or based upon the number
of days in such month).
(d) Tenant shall pay to Landlord all Additional Rent that is payable to
Landlord pursuant to the terms and conditions of this Lease within fifteen (15) days
after written demand therefore from Landlord, unless a different time period is
specified in this Lease. During the Primary Lease Term (but not any Renewal
Term) Additional Rent shall not exceed $0.25 per square foot per month, or
$1,550.00 per month (the “Additional Rent Cap”), with increases in such amount of
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3% each year on the anniversary of the Commencement Date. Additional Rent is
inclusive of, without limitation, Tenant’s Share of Operating Expenses, Real Estate
Taxes, insurance, repairs, maintenance, and any and all other amounts besides
Base Rent that are payable by Tenant under the terms of this Lease at any time
during the Primary Lease Term. Prior to commencement of the Renewal Term,
Landlord and Tenant shall negotiate in good faith to determinate an applicable
Additional Rent Cap for the Renewal Term. Notwithstanding the foregoing, Tenant
shall be responsible for the following, which shall not be subject to the Additional
Rent Cap: (i) Tenant’s separately metered utilities, (ji) Tenant’s Percentage of any
increase in Real Estate Taxes for the building containing the Premises in any given
year of the Lease Term in excess of twenty-five percent over the actual Real Estate
Taxes paid in the previous year of the Lease Term, and (iii) Tenant’s Percentage of
the Local Permit Fee.
(e) All Base Rent and Additional Rent (such Additional Rent that is due
and owing to Landlord pursuant to the terms and conditions of this Lease) shall be
paid, without notice or demand, except as otherwise specifically provided in this
Lease by check, ACH, or wire transfer of immediately available funds to an account
at a bank designated by Landlord in writing or by any other method reasonably
requested by Landlord. Landlord may, in its sole discretion, accept cash payment
upon Tenant’s agreement to the Cash Payment Addendum attached hereto as
Exhibit H.
Section 4.03 Late Payment.
(a) If any payment of Base Rent, Additional Rent, or any other charge or
expense payable under this Lease is not received by Landlord within seven (7) days
after its due date, such payment shall be subject to a late payment penalty of ten
percent (10%) of the unpaid amount due for each month or fraction thereof, or such
lesser amount as may be the maximum amount permitted by Law, until such
payment is received by Landlord.
(b) If any payment of Base Rent, Additional Rent, or any other charge or
expense payable under this Lease is not received by Landlord within thirty (30)
days of the applicable due date, Tenant shall pay to Landlord, as Additional Rent,
in addition to the late charge described above, interest on the overdue amount to
Landlord at the Interest Rate. Such overdue payment shall bear interest from the
applicable due date, without regard to any grace period, until the date such
payment is received by Landlord. Such payment shall be in addition to, and not in
lieu of, any other remedy Landlord may have.
ARTICLE V
OPERATING EXPENSES
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Section 5.01 Operating Expenses. For purposes of this Lease, the term "Operating
Expenses" shall mean any and all costs and expenses paid or incurred by Landlord (other
than Real Estate Taxes) in connection with the management, operation, maintenance and
repair of the Building Complex including, without limitation:
(a) The cost of repairs, replacements, maintenance and cleaning,
including, without limitation, the cost of janitorial and other service agreements,
and snow, ice, trash and debris removal.
(b) The cost of all repairs and maintenance associated with the landscaped
areas, roadways, sidewalks, parkways, driveways, Common Area lighting facilities,
fences, gates, elevators, roofs, and exterior walls, including paint, exterior signs,
awnings, any tenant directories and fire detection and sprinkler systems.
(c) The cost of water, gas, electricity, sewer service and other systems and
utilities and telephone and the cost of supplies and equipment and maintenance
and service contracts in connection therewith.
(d) Fees, charges and other costs, including, without limitation, consulting
fees, attorneys’ fees and accounting fees of all contractors engaged by landlord in
connection with the operation, maintenance or repair of the Building Complex.
(e) Property management fee of up to 15% of outside costs for
administrative and security services.
6 Any environmental inspections and reports.
(g) Premiums for the insurance policies maintained by Landlord.
(h) Any deductible portion of an insured loss.
@) The cost of supplies, materials and equipment used in the
management, operation, maintenance and repair of the Building Project, including,
without limitation, any rental fees for any such supplies, materials and equipment.
@) Fees, costs and disbursements incurred in connection with proceedings
to contest, determine or reduce Operating Expenses or Real Estate Taxes.
(k) Expenditures for capital improvements, structural repairs and
replacements that are: (i) required in order to conform to changes to any Laws after
the date of this Lease: (ii) intended as a cost or labor saving device or to effect other
economics in the operation of the Building Complex; or (iii) reasonably determined
by Landlord to be necessary or appropriate for the operation of the Building
Complex, which will be calculated each year by dividing the estimated cost of such
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Page 13 of 71
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item(s) by the estimated useful life of such item(s) at the Interest Rate, as
reasonably determined by Landlord.
@ The costs payable by the Building Complex pursuant to any
declarations of protective covenants or other comparable recorded instruments
affecting the Building Complex.
All such Operating Expenses shall be recorded on an accrual basis and in
accordance with acceptable principles of sound management and accounting practices
applicable to similar projects in the same geographical area as that in which the Building
Complex is located.
Section 5.02 Operating Expenses Exclusions. Operating Expenses shall specifically
exclude the following costs and expenses incurred by Landlord:
(a) Capital repairs made to the Building Complex (except as may
otherwise be allowed u
Preview
CHARLES M. CLARK (SBN 244535) clark@jacksontidus.law JOSHUA J. ANDERSON (SBN 279170) E-FILED janderson@jacksontidus.law 5/2/2024 10:24 AM Superior Court of California JACKSON TIDUS, A Law Corporation County of Fresno 2030 Main Street, Suite 1500 By: Rosa Garza, Deputy Irvine, California 92614 (949) 752-8585 Attorneys for Plaintiff Left Mendota I, LLC SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF FRESNO 10 11 LEFT MENDOTA I, LLC, a Delaware CASENO. 24CECG01800 limited liability company, 12 Plaintiff, VERIFIED COMPLAINT FOR 13 UNLAWFUL DETAINER vs. 14 CLEARVIEW MANAGEMENT 15 SOLUTIONS, LLC, a California limited liability company; THE PACK 16 COMPANY, LLC; and DOES 1 to 50, inclusive, 17 Defendants. 18 19 20 21 22 23 24 25 26 27 28 -l- 1631802.1 VERIFIED COMPLAINT FOR UNLAWFUL DETAINER Plaintiff Left Mendota I, LLC alleges as follows: THE PARTIES 1 At all relevant times, Plaintiff Left Mendota I, LLC (“Plaintiff”) is and was a Delaware limited liability company doing business in Fresno County, California. 2. Plaintiff is the owner of the property located at 1269 Marie Street, Suite 6, Mendota, California 93640 (“Premises”) which is located in this Court’s judicial district. 3 Plaintiff is informed and believes, and based thereon alleges, that at all relevant times, Clearview Management Solution, LLC (“Defendant”) is and was a California limited liability company doing business in Fresno County, California. 10 4 Plaintiff is informed and believes, and based thereon alleges, that at all relevant 11 times, The Pack Company, LLC (“Defendant Guarantor”) is and was a California limited 12 liability company doing business in Fresno County, California. 13 5 Plaintiff does not know the true names and capacities of the defendants named as 14 DOES | through 50, inclusive. Plaintiff will seek leave to amend this Complaint to allege their 15 names and capacities when ascertained. 16 6. Plaintiff is informed and believes, and based thereon alleges, that the defendants 17 designated as DOES 1 through 50, inclusive, are persons or entities in some way responsible for 18 the acts or omissions alleged, that they have some right, title or interest in the subject matter of 19 this action, or that they are otherwise required to be joined as a party in order for Plaintiff to 20 obtain all the relief to which it is entitled. Moreover, Plaintiff is informed and believes, and 21 based thereon alleges, that each of the defendants, including the defendants served as DOE, 22 claim some type of possessory interest in and to the Premises. 7 23 Each defendant, including the DOE defendants, was and is the agent, employee, 24 employer, affiliate, representative, alter ego, subsidiary, affiliate and/or partner of one or more of 25 the other defendants, and was, in performing the acts complained of, acting within the scope of 26 such agency, employment, or is in some other way responsible for the acts of one or more of the 27 defendants. 28 /// -2- 1631802.1 VERIFIED COMPLAINT FOR UNLAWFUL DETAINER THE LEASE 8 On or about December 18, 2018, Plaintiff executed a Lease Agreement with Defendant to occupy and conduct business at the Premises (the Lease, and any amendments thereto shall be referred to as the “Lease”). An accurate copy of this Lease and amendments thereto are attached as Exhibit 1 and incorporated by this reference as if fully set forth herein. 9. Plaintiffas Landlord has all rights and remedies under the Lease. 10. On or about December 17, 2018, Defendant Guarantor entered into a Guaranty Agreement with Plaintiff in which Defendant Guarantor agreed to guaranty all of Defendant’s monetary obligations under the Lease. (/d.) 10 NOTICE TO PAY RENT OR QUIT 11 11. Defendant, Defendant Guarantor and any other occupants were properly served 12 on April 15, 2024, with a Five (5) Day Notice to Pay Rent or Quit (“Notice to Pay Rent or Quit”) 13 under California Code of Civil Procedure Section 1161.1, et seq. that demanded Defendant 14 immediately pay the outstanding balance of $33,184.23 for April 2024 Rent. An accurate copy 15 of the Notice to Pay Rent or Quit is attached as Exhibit 2 and incorporated by this reference as if 16 fully set forth herein. 17 12. All facts stated in the Notice to Pay Rent or Quit were true at the time it was 18 served. 19 13. The Notice to Pay Rent or Quit included an election of forfeiture. 20 14. The period stated in the Notice to Pay Rent or Quit expired. Defendant and 21 Defendant Guarantor failed to play the outstanding rent balance of $33,184.23. 22 15. Plaintiff has performed all conditions, covenants and promises required of it by 23 the Lease except those, if any, that were waived and excused by Defendants’ conduct. 24 16. Defendant continues to occupy the Premises and refuses to surrender possession 25 to Plaintiff. 26 REMEDIES AND DAMAGES 27 17. Defendant improperly maintains possession of the Premises. The possession is 28 without Plaintiff's permission or consent. Plaintiff is entitled to immediate possession of the 3- 1631802.1 VERIFIED COMPLAINT FOR UNLAWFUL DETAINER Premises, so Defendant must immediately vacate the Premises and possession must be returned to Plaintiff. 18. The fair rental value of the Premises shall be established according to proof, but is estimated to be at least $1,106.14 per day. 19. Section 22.04 of the Lease provides for the recovery of reasonable attorneys’ fees incurred by Plaintiff in recovering possession of the Premises. 20. Plaintiff accepts the jurisdictional limit, if any, of the Court. UNLAWFUL DETAINER ASSISTANT (Bus. & Prof. Code, §§ 6400-6415) 21. An unlawful detainer assistant did not for compensation give advice or assistance 10 with this pleading. 11 PRAYER 12 WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as 13 follows: 14 (a) immediate possession of the Premises; 15 (b) forfeiture of the Lease; 16 (d) damages at the rate of $1,106.14 per day from April 20, 2024 for each day 17 Defendant remains in possession through entry of judgment; 18 (e) costs incurred in this action; 19 (f) reasonable attorneys’ fees; and, 20 (g) such other and further relief as the Court deems proper. 21 DATED: April 30, 2024 JACKSON TIDUS, A Law Corporation 22 a B 23 ” Charles M. Clark Attorneys for Left Mendota I, LLC 24 25 26 27 28 4. 1631802.1 VERIFIED COMPLAINT FOR UNLAWFUL DETAINER DocuSign Envelope 1D: 0A7F82E4-E304-483C-812C-461E2972633A VERIFICATION I, Ben Kriger, declare as follows: Tam an authorized agent of Left Mendota I, LLC, the owner of property located at 1269 Marie Street, Suite 6, California 93640 (“Premises”). In such capacity, I have personal knowledge of the actions taken with respect to the Premises. I have read the foregoing Summons and Complaint for Unlawful Detainer and know the contents thereof. I certify that the same is true from my own knowledge in the capacity described above, except as to those matters stated upon information and belief, and as to those matters I believe them to be true. I declare under penalty of perjury under the laws of the State of California that the 10 foregoing is true and correct. 11 Executed on this 30th day of April 30, 2024, at Chicago, Illinois. 12 DocuSigned by: 13 A B1GAEFRC?RE341 14 Ben Kriger 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -l- 1631802.1 VERIFICATION 5. EXHIBIT 1 COMMERCIAL LEASE BETWEEN MARIE STREET DEVELOPMENT, LLC (LANDLORD) AND CLEARVIEW MANAGEMENT SOLUTIONS, LLC (TENANT) Property: Mendota -7- TABLE OF CONTENTS ARTICLE IBASIC LEASE PROVISIONS ARTICLE !IIDEFINITIONS. ARTICLE IIIPREMISES .. ARTICLE |VPAYMENT OF BASE RENT AND ADDITIONAL RENT 11 ARTICLE VOPERATING EXPENSES 12 ARTICLE VITAXES 17 ARTICLE VIIDEPOSITS. 18 ARTICLE VIIICANNABIS COMPLIANCE 19 ARTICLE IXUSE 22 ARTICLE XHAZARDOUS MATERIALS. 23 ARTICLE XIPARKING 25 ARTICLE XISERVICES AND UTILITIES 25 ARTICLE XIIIMAINTENANCE, REPAIRS AND ALTERATIONS 25 ARTICLE XIVTRADE FIXTURES 27 ARTICLE XYCOVENANT AGAINST LIENS. 28 ARTICLE XVIRULES AND REGULATIONS 29 ARTICLE XVIIASSIGNMENT AND SUBLEASING 29 ARTICLE XVIITNSURANCE AND INDEMNIFICATION. 32 ARTICLE XIXCERTIFIED ACCESS SPECIALIST 35 ARTICLE XXDAMAGE AND DESTRUCTION 35 ARTICLE XXIEMINENT DOMAIN.. 37 ARTICLE XXIIDEFAULTS AND REMEDIES 37 ARTICLE XXIIIPROTECTION OF LENDERS 41 ARTICLE XXIVWAIVER OF CLAIMS 43 ARTICLE XXVWAIVER OF NOTICE 43 Lease Agreement Table of Contents Page 1 of 2 -8- ARTICLE XXVINOTICES 43 ARTICLE XXVIIBROKERS 44 ARTICLE XXVIIIQUIET ENJOYMENT 44 ARTICLE XXIXEND OF TERM 45 ARTICLE XXXGUARANTOR 45 ARTICLE XXXIDISPUTE RESOLUTION 45 ARTICLE XXXIICONFIDENTIALITY .. 46 ARTICLE XXXIIIMISCELLANEOUS PROVISIONS. 47 ARTICLE XXXIVRENEWAL TERM 49 Lease Agreement Table of Contents Page 2 of 2 -9- This LEASE AGREEMENT ("Lease"), dated as of the Effective Date, is by and between Landlord and Tenant, as defined herein. ARTICLE I BASIC LEASE PROVISIONS Each reference in this Lease to the “Basic Lease Provisions” shall mean and refer to the following collective terms, the application of which shall be governed by the provisions in the remaining Articles of this Lease. Section 1.01 Landlord’s Name: Marie Street Development, LLC, a Delaware limited liability company Section 1.02 Tenant’s Name: Clearview Management Solutions, LLC, a California limited liability company Section 1.03 Effective Date: December 18, 2018 Section 1.04 Address for Payments and Notices: LANDLORD TENANT Marie Street Development, LLC Clearview Management Solutions, LLC 2448 Fillmore St., #380-3336 315 W. 9% St., Ste. 400 San Francisco, CA 94115 Los Angeles, CA 90015 Attn: Mr. Jonathan Charak Attn: Ben Catt jonathan@canna-hub.com ben@dompen.co With a copy to: With a copy to: Attn: Mr. Thom Ferguson Attn: Hilary Bricken Ferguson Corporate Law, Ltd. Harris Bricken McVay Sliwoski, LLP PO Box 102 120 Green Street, Suite 300 Libertyville, IL 60048 San Francisco, CA 94111 thom@fergusoncorplaw.com hilary@harrisbricken.com Lease Agreement Page 1 of 71 -10- Section 1.05 Land: The Land is known as Canna-Hub Mendota, located upon Assessor Parcel Numbers 013-280-15, 013-280-228, 013-280-148, 013-280-19, 013-280- 21S. The Legal Description of the Land attached as Exhibit A to this Agreement. Section 1.06 Building: The Building shall mean the improvements in which the Premises are located, having a street address of 1269 Marie Street, Mendota, CA 93640 and shown in the Floor Plan. Section 1.07 Premises shall mean approximately 6,200 square feet located in the Building, identified as Suite # 6 on Exhibit B, including all improvements therein or to be provided by Landlord under the terms of this Lease and being the space cross hatched on the Floor Plan attached hereto and made a part hereof. Tenant acknowledges that in determining the number of square feet of space in the Premises, all distances have been measured from the exterior face of all exterior walls and the center of all partition walls which separate the Premises from any interior area. Section 1.08 Base Rent: Subject to Section 4.02(b) hereof, for the period commencing on the Rent Commencement Date and ending 12 months thereafter, a monthly lease rate of $3.00 per square foot, or a total amount of $18,600 per month, with increases in the amount of 3% each year on the anniversary of the Commencement Date. Section 1.09 Most Favored Nation Pricing: During the Primary Lease Term, to the extent that another lease (“Other Lease’) is executed for any other suite located within the Building Complex that is (a) owned by Landlord or any of its Affiliates, (b) not more than 7,000 of rentable square feet in a similar type structure (i.e. not a greenhouse space), (c) is leased for a Primary Lease Term of four (4) years or less, and (d) the combined starting Base Rent and Additional Rent for the Other Lease is less than the current combination of Base Rent rate and Additional Rent rate for Tenant under this Lease at the time the Other Lease is executed, then Landlord will notify Tenant within five (5) business days after execution of the Other Lease and amend this Lease such that Tenant shall receive the same lower combination of Base Rent rate and Additional Rent rate for a period equal to the term of the Other Lease or the remainder of the Primary Lease Term, whichever is sooner and Tenants reduced combination of Base Rent and Additional Rent shall commence upon the Rent Commencement Date of the Other Lease. The Tenant may also elect to reduce the Primary Lease Term to a period that is equal to the Primary Lease Term of the Other Lease. For the avoidance of doubt, there will be no credit provided to the Tenant for any period of time prior to the Rent Commencement Date of the Other Lease. Further, Tenant acknowledges that this Section 1.09 shall apply exclusively to the Primary Lease Term, and it is not intended to survive into any Renewal Term. Section 1.10 Estimated Commencement Date: on or before January 15,2019 Section 1.11 Rent Commencement Date: upon the earlier of the issuance of Tenant’s post-buildout Certificate of Occupancy from the Local Authority, or 60 days after the Commencement Date. Lease Agreement Page 2 of 71 -ll- Section 1.12 Primary Lease Term: 48 months from the first day of the calendar month following the Commencement Date. Section 1.13 Deposits. A deposit representing 2 months of rent, or $37,200 (“Security Deposit”), as well as a deposit representing a single quarterly payment of the Local Permit Fee, or $12,400 (‘Local Permit Fee Deposit”), shall be deposited by Tenant in accordance with ARTICLE VII hereof. Section 1.14 Renewal Option: One 36-month period Section 1.15 Permitted Use shall only mean the uses specifically identified as permitted below, to be interpreted consistent with the Medicinal and Adult-Use Cannabis Regulation and Safety Act and successor statutes, along with such reasonably-related ancillary uses such as general office use (which ancillary uses shall not include any Commercial Cannabis Activity): License Description State License Type(s) Adult Use Medicinal Permitted Permitted Distribution 11 Yes Yes Manufacturing Volatile using only 7 Yes Yes the following solvents: Butane Hexane Propane Subject to Volatile Extraction Addendum, Attached as Exhibit G Section 1.16 Guarantor(s) The Pack Company, LLC, a California LLC Section 1.17 Landlord’s Broker: None Section 1.18 Tenant’s Broker: None ARTICLE II DEFINITIONS Section 2.01 Definitions. The terms defined in this ARTICLE II shall have the following meanings whenever used in this Lease: Lease Agreement Page 3 of 71 -12- "Additional Rent" shall mean all monetary obligations, other than Base Rent, of Tenant to Landlord under the terms of this Lease, whether or not specified as Additional Rent herein. "Address of Landlord for Notices" shall have the meaning shown in the Basic Lease Provisions, or such address as Landlord shall subsequently designate in writing. "Address of Tenant for Notices" shall have the meaning shown in the Basic Lease Provisions, or such address as Tenant shall subsequently designate in writing. "ADA" shall mean the Americans with Disabilities Act of 1990, (42 U.S.C. §§ 12101 to 12213), as amended by the Americans with Disabilities Act Amendments of 2008 (Pub. L. No. 110-325). "Assignment" and "Assignee" shall have the meaning set forth in Section 17.01 hereof. "Base Rent" shall have the meaning shown in the Basic Lease Provisions. "Binding Renewal Notice" shall have the meaning set forth in Section 34.03 hereof. "Brokers" shall mean, collectively, the Landlord's Broker and the Tenant's Broker. "Building" shall have the meaning shown in the Basic Lease Provisions. "Building Complex" shall mean the Premises, the Building and the Common Areas, together with all other existing and future buildings and improvements erected on the Land. "Certificate of Occupancy" shall mean the certificate issued by the building department of the city where the Land is located, in certifying that the Premises have been improved in compliance with all applicable Laws and the Premises are in a condition suitable for occupancy. “Commercial Cannabis Activity” shall have the definition supplied by California Business & Professions Code Section 26001, as amended from time to time. "Commencement Date" shall mean the date on which Landlord delivers the Premises as specified in Section 3.02 for Tenant’s buildout of the Premises, and such date is not tied to Tenant being able to use or occupy the Premises (other than for purposes of Tenant’s buildout). "Common Areas" shall mean all areas and facilities located outside of the Premises and within the exterior boundary line of the Building Complex that are provided and designated by the Landlord from time to time for the general non-exclusive use of Lease Agreement Page 4 of 71 -13- Landlord, Tenant and other tenants of the Building Complex and their respective employees, suppliers, shippers, customers, contractors and invitees, including, without limitation, parking areas, loading and unloading areas, trash areas, lighting facilities, fences and gates, roadways, sidewalks, walkways, parkways, driveways and landscaped areas. “Conditional Use Permit” shall mean that certain conditional use permit issued by the City of Mendota to CHH, LLC (the owner of the Landlord) and attached hereto as Exhibit I. "Confidential Information" shall have the meaning set forth in Section 32.01hereof. “Development Agreement” shall mean that certain development agreement between Landlord and the City of Mendota attached hereto as Exhibit J. “Deposit” shall mean the Security Deposit and the Permit Fee Deposit. "Effective Date" shall have the meaning shown in the Basic Lease Provisions. "Environmental Laws" shall mean all Laws: (a) relating to the environment, human health or natural resources; (b) regulating, controlling or imposing liability or standards of conduct concerning any Hazardous Materials: (c) relating to Remedial Actions: and (d) requiring notification or disclosure of releases of Hazardous Materials or of the existence of any environmental conditions on or at the Premises, as any of the foregoing may be amended, supplemented, or supplanted from time to time. "Estimated Commencement Date" shall have the meaning shown in the Basic Lease Provisions. "Event(s) of Default" shall have the meaning set forth in Section 22.02 hereof. "Expiration Date" shall mean the last day of the month in which the period of the Lease Term ends, with the Lease Term beginning to run with the Commencement Date, as same may be extended pursuant to ARTICLE XXXIV hereof, or such earlier date on which the Term shall sooner end pursuant to any of the terms, covenants or conditions of this Lease or pursuant to Law. "Guarantor(s) " shall have the meaning shown in the Basic Lease Provisions. "Hazardous Materials" shall mean any pollutant or contaminant or hazardous, dangerous or toxic chemicals, materials, or substances within the meaning of any applicable Environmental Law relating to or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste substance or material, all as amended or hereafter amended, including, without limitation, any material or substance which is: (a) designated as a "hazardous substance" pursuant to Section 311 of the Federal Water Lease Agreement Page 5 of 71 -14- Pollution Control Act (33 U.S.C. Section 1317); (b) defined as a "hazardous waste" pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq. (42 U.S.C. Section 6903); (c) defined as a "hazardous substance" pursuant to Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et seq. (42 U.S.C. Section 9601); (d) petroleum; (e) asbestos or asbestos-containing materials; (f) polychlorinated biphenyls ("PCBs") or substances or compounds containing PCBs; (g) radon: (h) medical waste; and (i) petroleum products. "Initial Renewal Notice" shall have the meaning set forth in Section 34.01 hereof. "Interest Rate" shall mean the Prime Rate plus 5 percent (5% per annum but, in no event, in excess of the maximum permissible interest rate then in effect in the State. "Land" shall have the meaning shown in the Basic Lease Provisions. "Landlord's Broker" shall have the meaning shown in the Basic Lease Provisions. "Landlord’s Equipment" shall have the meaning set forth in Section 14.01. "Landlord's Operating Expenses Statement " shall have the meaning set forth in Section 5.05 hereof. "Law" or “Laws” shall mean all laws, statutes and ordinances (including building codes and zoning ordinances and regulations), rules, orders, directives and requirements of all federal, state, county, municipal departments, bureaus, boards, agencies, offices, commissions and other subdivisions thereof, or of any official thereof, or of any governmental, public or quasi-public authority, whether now or hereafter in force, which may be applicable to the Building Complex, the Building or the Premises or any part thereof, including, without limitation, the ADA and the OSH Act, and any reciprocal easement, covenant, restriction, or other agreement, restriction of easement of record affecting the Building Complex as of the date of this Lease or subsequent thereto. “Law” shall exclude all federal laws, including without limitation the Controlled Substances Act, to the extent they are inconsistent or in conflict with Tenant’s use of the Premises for the Permitted Use in compliance with State and Local Authority laws. "Lease Renewal Amendment" shall have the meaning set forth in Section 34.03(c) hereof. “Local Authority” shall mean the government of the city where the Land is located, including all departments and agencies thereof. “Local Permit Fee” shall mean Tenant’s Percentage of the actual fees paid by Landlord to the Local Authority as the square foot charge for the Premises payable under the Development Agreement with the City of Mendota. The Local Permit Fee shall be a Lease Agreement Page 6 of 71 -15- direct dollar-for-dollar pass through to Tenant based on Tenant’s Percentage of actual fees paid by Landlord. “Local Permit Fee Deposit " shall have the meaning shown in the Basic Lease Provisions. "Operating Expenses" shall have the meaning set forth in Section 5.01 hereof. "OSH Act" shall mean the Occupational Health and Safety Act (29 U.S.C. §§ 651 to 678), as amended from time to time. "Permitted Use" shall have the meaning shown in the Basic Lease Provisions. "Premises" shall have the meaning shown in the Basic Lease Provisions. "Prevailing Market Rental Rate" shall have the meaning set forth in Section 34.04 hereof. "Primary Lease Term" shall mean the initial term of this Lease commencing on the Commencement Date and ending on the Expiration Date. "Prime Rate" shall mean the prime or base rate announced as such from time to time by Bank of America, and if not available, a comparable rate announced by another national bank selected by Landlord. Any interest payable under this Lease with reference to the Prime Rate shall be adjusted on a daily basis, based upon the Prime Rate in effect at the time in question, and shall be calculated on the basis of a 360-day year with twelve (12) months of 30 days each. "Property Manager" shall mean an individual or entity designed in writing by Landlord. "Purpose" as used in ARTICLE XXXII only shall have the meaning set forth in Section 32.02. "Real Estate Taxes" shall mean any form of real estate tax or assessment, general, special, ordinary or extraordinary imposed upon the Building Complex or any portion thereof by any authority having the direct or indirect power to tax, including any city, state or federal government, or any school, sanitary, fire, street, drainage, or other improvement district thereof, levied against any legal or equitable interest of Landlord in the Building Complex or any portion thereof. The term "Real Estate Taxes" shall also include any tax, fee, levy, assessment or charge, or any increase therein, imposed by reason of events occurring, or changes in applicable zoning, municipal, county, state and federal laws, ordinances and regulations and any covenants or restrictions of record taking effect during the Term of this Lease, including but not limited to a change in ownership of the Building Complex or the improvements thereon (or any portion thereof), the execution Lease Agreement Page 7 of 71 -16- of this Lease, or any modification, amendment or transfer thereof, and whether or not contemplated by the parties hereto. "Rejection Notice" shall have the meaning set forth in Section 34.03 hereof. "Remedial Action" shall mean the investigation, response, clean up, remediation, prevention, mitigation or removal of any Hazardous Materials necessary to comply with any Environmental Laws. "Renewal Option" shall mean have the meaning set forth in Section 34.01 hereof. "Renewal Term" shall have the meaning set forth in Section 34.01 hereof. “Rent Commencement Date" shall have the meaning shown in the Basic Lease Provisions. "Rent Payment Address" shall mean the Landlord address shown in the Basic Lease Provisions, or such address as Landlord shall subsequently designate in writing. "Rent" shall mean Base Rent and Additional Rent. "Representative" as used in ARTICLE XXXII only shall have the meaning set forth in Section 32.01. "Rules and Regulations" shall mean the rules and regulations governing the Premises, the Building and the Building Complex, attached hereto as Exhibit C and made a part hereof, as same may be amended from time to time. "Security Deposit" shall have the meaning shown in the Basic Lease Provisions. "State" shall mean the State of California. "State Authorities" means the government of the State including all departments and agencies thereof. "Tenant Improvements" shall mean the improvements and alterations to the Premises performed by or on behalf of Tenant. "Tenant's Broker" shall have the meaning shown in the Basic Lease Provisions. "Tenant's Contractor" shall have the meaning set forth in Section 3.03 hereof. "Tenant's Percentage" shall mean a percentage derived by dividing the final rentable square feet of the Premises as determined on the executed Commencement Date Memorandum by the approximate rentable square feet in the Building Complex. Tenant agrees that the square feet of floor area in the Premises and/or the Building Complex, the Lease Agreement Page 8 of 71 -17- Base Rent, Tenant's Share of Operating Expenses and Tenant's Share of Real Estate Taxes may be recalculated in the event the premises and/or the Building Complex are remeasured by Landlord at any time during the Term and it is determined that the total number of square feet of floor area in the premises and/or the Building Complex differs from those set forth herein. "Tenant's Share of Operating Expenses" shall mean Tenant's proportionate share of Operating Expenses based on Tenant's Percentage. "Tenant's Share of Real Estate Taxes" shall mean Tenant's proportionate share of Real Estate Taxes based on Tenant's Percentage. "Term" shall mean the Primary Lease Term and the Renewal Lease Term (provided Tenant is entitled to and properly exercises the Renewal Option). "Trade Fixture" shall have the meaning set forth in Section 14.01 hereof. ARTICLE HI PREMISES Section 3.01 Lease of Premises for Lease Term. Subject to the terms and conditions of this Lease, Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the Premises for a Primary Lease Term that shall commence on the Commencement Date and end on the Expiration Date (as such Primary Lease Term may be extended pursuant to ARTICLE XXXIV hereof), subject to earlier termination pursuant to any of the terms, covenants or conditions of this Lease or pursuant to Law. Promptly after the Commencement Date, Landlord and Tenant shall execute a commencement date agreement in the form attached hereto as Exhibit D acknowledging the Commencement Date and the Expiration Date for the Primary Lease Term. Section 3.02 Acceptance of Premises. Landlord will deliver the Premises as specified in the “Work Letter” (Exhibit F), including with those (and only those) utility services identified in the Work Letter. Tenant hereby acknowledges that: (a) Tenant will have the opportunity to inspect the Premises prior to delivery of the Premises to Tenant and will accept the Premises is its "AS IS, WHERE IS" condition; (b) the Premises is acceptable for Tenant's intended Permitted Use: and (c) neither Landlord, Landlord's Broker, nor any of Landlord's agents, has made any oral or written representations or warranties with respect to said matters other than as set forth in this Lease. EXCEPT AS EXPRESSLY SET FORTH IN THIS LEASE, TENANT ACCEPTS THE PREMISES IN ITS "AS IS" CONDITION AND TENANT EXPRESSLY WAIVES ANY WARRANTY OF CONDITION OR OF HABITABILITY OR SUITABILITY FOR OCCUPANCY, USE, HABITATION, FITNESS FOR A PARTICULAR PURPOSE OR MERCHANTABILITY, EXPRESS OR IMPLIED, RELATING TO THE PREMISES. Lease Agreement Page 9 of 71 -18- Section 3.03 Initial Improvements. Following delivery of the Premises by Landlord pursuant to the Work Letter, Tenant shall be responsible for making all improvements desired by Tenant in connection with its initial occupancy (the “Initial Improvements”). Tenant shall be required to complete the Initial Tenant Improvements on or prior to the date Tenant opens for business in the Premises. Section 3.04 Delay in Commencement. Landlord shall not be liable to Tenant if Landlord does not deliver possession of the Premises to Tenant on the Estimated Commencement Date and such failure to deliver the Premises shall not affect this Lease or the obligations of Tenant hereunder. If Landlord does not deliver possession of the Premises to Tenant within ninety (90) days after the Estimated Commencement Date, Tenant may elect to cancel this Lease by giving written notice to Landlord within fifteen (15) days after the ninety (90) day period ends. For purposes of Landlord delivering possession of the Premises to Tenant, such delivery shall not mean the Premises are ready for occupancy, but that Landlord has performed all of the Landlord’s Work pursuant to the Work Letter and the Premises are delivered to Tenant in order for Tenant to perform the remaining buildout. If Tenant gives such notice, this Lease shall be cancelled, effective immediately, and neither Landlord nor Tenant shall have any further obligation to the other. If Tenant does not give such notice within such specified time period, Tenant's right to cancel the Lease shall expire and the Primary Lease Term shall commence upon the delivery of possession of the Premises to Tenant. Section 3.05 Common Areas. Landlord hereby grants to Tenant, for the benefit of Tenant and its employees, suppliers, shippers, customers, contractors and invitees, during the Term of this Lease, the nonexclusive 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 Landlord under the terms hereof or under the terms of any Rules and Regulations governing the use of the Building Complex. Under no circumstances shall the right granted herein be deemed to include the temporary or permanent right to store any property in the Common Areas. Landlord shall have the right, from time to time, to: (a) establish, modify, amend and enforce the Rules and Regulations regarding the Common Areas, provided that any such modifications do not require Tenant to pay any additional money; (b) make changes to the Common Areas, including, without limitation, changes in the location, size, shape and number of driveways, entrances, ingress, egress, direction of traffic, parking spaces, parking areas, loading and unloading areas, landscaped areas and walkways, provided that any such changes shall not materially interfere with Tenant’s use of the Premises: (c) close temporarily any of the Common Areas for maintenance purposes so long as Tenant’s reasonable access to the Premises remains available; (d) add additional buildings and improvements to the Common Areas; and (e) do and perform such other acts and make such other changes in, to, or with respect to the Common Areas and Building Complex as Landlord may, in the exercise of sound business judgment, deem to be appropriate, provided that any such changes shall not materially interfere with Tenant’s use of the Premises. All parking areas, driveways, entrances and exits thereto, stairways, lobbies Lease Agreement Page 10 of 71 -19- and all other Common Areas provided by Landlord for the general use in common by all tenants in the Building Complex shall be at all times subject to the exclusive control and management of Landlord. ARTICLE IV PAYMENT OF BASE RENT AND ADDITIONAL RENT Section 4.01 Base Rent. (a) Tenant covenants and agrees to pay base rent ("Base Rent") to Landlord throughout the Primary Lease Term of this Lease in the amounts shown in the Basic Lease Provisions. (b) If Tenant is entitled to and properly exercises its Renewal Option in accordance with the terms of ARTICLE XXXIV of this Lease, the Base Rent payable with respect to the Renewal Term shall be an amount as determined pursuant to Section 27.02 thereof. Section 4.02 Time and Manner of Base Rent and Additional Rent Payments. (a) Upon the Rent Commencement Date, Tenant shall pay Base Rent to Landlord in equal monthly installments, in advance, commencing on the first day of each month during the Term, without notice or demand. (b) Base Rent shall be abated until the Rent Commencement Date, but Tenant shall be obligated to pay Tenant’s Share of Operating Expenses beginning on the Commencement Date, subject to subsection 4.02(d) below. Additionally, Landlord shall provide to Tenant an allowance for the cost of Tenant’s desired improvements in the amount of $3.00 per square foot, or $18,600.00 (the “Tenant Improvement Allowance”). Landlord shall directly credit the Tenant Improvement Allowance ratably ($3,100 per month) against Tenant’s Base Rent payment due during the first six (6) months following the Rent Commencement Date. (c) Base Rent due for any period of less than twelve (12) months (or any monthly installment of Base Rent due for any period of less than a full month) shall be appropriately apportioned based upon a 360-day year (or based upon the number of days in such month). (d) Tenant shall pay to Landlord all Additional Rent that is payable to Landlord pursuant to the terms and conditions of this Lease within fifteen (15) days after written demand therefore from Landlord, unless a different time period is specified in this Lease. During the Primary Lease Term (but not any Renewal Term) Additional Rent shall not exceed $0.25 per square foot per month, or $1,550.00 per month (the “Additional Rent Cap”), with increases in such amount of Lease Agreement Page 11 of 71 -20- 3% each year on the anniversary of the Commencement Date. Additional Rent is inclusive of, without limitation, Tenant’s Share of Operating Expenses, Real Estate Taxes, insurance, repairs, maintenance, and any and all other amounts besides Base Rent that are payable by Tenant under the terms of this Lease at any time during the Primary Lease Term. Prior to commencement of the Renewal Term, Landlord and Tenant shall negotiate in good faith to determinate an applicable Additional Rent Cap for the Renewal Term. Notwithstanding the foregoing, Tenant shall be responsible for the following, which shall not be subject to the Additional Rent Cap: (i) Tenant’s separately metered utilities, (ji) Tenant’s Percentage of any increase in Real Estate Taxes for the building containing the Premises in any given year of the Lease Term in excess of twenty-five percent over the actual Real Estate Taxes paid in the previous year of the Lease Term, and (iii) Tenant’s Percentage of the Local Permit Fee. (e) All Base Rent and Additional Rent (such Additional Rent that is due and owing to Landlord pursuant to the terms and conditions of this Lease) shall be paid, without notice or demand, except as otherwise specifically provided in this Lease by check, ACH, or wire transfer of immediately available funds to an account at a bank designated by Landlord in writing or by any other method reasonably requested by Landlord. Landlord may, in its sole discretion, accept cash payment upon Tenant’s agreement to the Cash Payment Addendum attached hereto as Exhibit H. Section 4.03 Late Payment. (a) If any payment of Base Rent, Additional Rent, or any other charge or expense payable under this Lease is not received by Landlord within seven (7) days after its due date, such payment shall be subject to a late payment penalty of ten percent (10%) of the unpaid amount due for each month or fraction thereof, or such lesser amount as may be the maximum amount permitted by Law, until such payment is received by Landlord. (b) If any payment of Base Rent, Additional Rent, or any other charge or expense payable under this Lease is not received by Landlord within thirty (30) days of the applicable due date, Tenant shall pay to Landlord, as Additional Rent, in addition to the late charge described above, interest on the overdue amount to Landlord at the Interest Rate. Such overdue payment shall bear interest from the applicable due date, without regard to any grace period, until the date such payment is received by Landlord. Such payment shall be in addition to, and not in lieu of, any other remedy Landlord may have. ARTICLE V OPERATING EXPENSES Lease Agreement Page 12 of 71 -21- Section 5.01 Operating Expenses. For purposes of this Lease, the term "Operating Expenses" shall mean any and all costs and expenses paid or incurred by Landlord (other than Real Estate Taxes) in connection with the management, operation, maintenance and repair of the Building Complex including, without limitation: (a) The cost of repairs, replacements, maintenance and cleaning, including, without limitation, the cost of janitorial and other service agreements, and snow, ice, trash and debris removal. (b) The cost of all repairs and maintenance associated with the landscaped areas, roadways, sidewalks, parkways, driveways, Common Area lighting facilities, fences, gates, elevators, roofs, and exterior walls, including paint, exterior signs, awnings, any tenant directories and fire detection and sprinkler systems. (c) The cost of water, gas, electricity, sewer service and other systems and utilities and telephone and the cost of supplies and equipment and maintenance and service contracts in connection therewith. (d) Fees, charges and other costs, including, without limitation, consulting fees, attorneys’ fees and accounting fees of all contractors engaged by landlord in connection with the operation, maintenance or repair of the Building Complex. (e) Property management fee of up to 15% of outside costs for administrative and security services. 6 Any environmental inspections and reports. (g) Premiums for the insurance policies maintained by Landlord. (h) Any deductible portion of an insured loss. @) The cost of supplies, materials and equipment used in the management, operation, maintenance and repair of the Building Project, including, without limitation, any rental fees for any such supplies, materials and equipment. @) Fees, costs and disbursements incurred in connection with proceedings to contest, determine or reduce Operating Expenses or Real Estate Taxes. (k) Expenditures for capital improvements, structural repairs and replacements that are: (i) required in order to conform to changes to any Laws after the date of this Lease: (ii) intended as a cost or labor saving device or to effect other economics in the operation of the Building Complex; or (iii) reasonably determined by Landlord to be necessary or appropriate for the operation of the Building Complex, which will be calculated each year by dividing the estimated cost of such Lease Agreement Page 13 of 71 -22- item(s) by the estimated useful life of such item(s) at the Interest Rate, as reasonably determined by Landlord. @ The costs payable by the Building Complex pursuant to any declarations of protective covenants or other comparable recorded instruments affecting the Building Complex. All such Operating Expenses shall be recorded on an accrual basis and in accordance with acceptable principles of sound management and accounting practices applicable to similar projects in the same geographical area as that in which the Building Complex is located. Section 5.02 Operating Expenses Exclusions. Operating Expenses shall specifically exclude the following costs and expenses incurred by Landlord: (a) Capital repairs made to the Building Complex (except as may otherwise be allowed u