Preview
Filed
4/12/2023 8:36 PM
Beverley McGrew Walker
District Clerk
Fort Bend County, Texas
Sylvie Le
CAUSE NO. 21-DCV-280353
KENNEDY ROOFING & EXTERIORS, INC. § IN THE DISTRICT COURT OF
§
Vv. FORT BEND COUNTY, TEXAS
LJ PARKWAY, LLC 43474 JUDICIAL DISTRICT
DEFENDANT LJ PARKWAY LLC’S APRIL 2023
TRADITIONAL RULE 166A MOTION FOR SUMMARY JUDGMENT
BASED ON
DTPA EXEMPTIONS IN TEX. BUS. & COMM. CODE §17.49(G)
AND IN TEX. BUS. & COMM. CODE §17.49(F)
Defendant LJ PARKWAY, LLC (“Defendant” or “LJ Parkway” or “LJP”) files this
TRADITIONAL [R166A[ MOTION FOR SUMMARY JUDGMENT BASED ON DTPA EXEMPTIONS IN
TEx. Bus. & COMM. CODE (“TBCC”) §17.49(g) and (f) (“MSJ”) against Plaintiff KENNEDY
ROOFING & EXTERIORS, INC. (“Plaintiff’ or “Kennedy Roofing” or “KRE”). KRE’s DTPA
claims are not viable because the transaction at issue involved consideration, as established by the
face of the transaction agreement, in excess of $500,000.00, and is not a transaction involving the
consumer’s residence. See TBCC §17.49(g). Likewise, the DTPA excludes transactions
involving total consideration by the “consumer” of more than $100,000 when the consumer is
9 o9?
represented by legal counsel and the contract does not involve the “consumer Ss residence. See
TBCC §17.49(f). As such, the transaction is excluded from applicability under the DTPA.
Pending before the Court is LJP’s Motion for Summary Judgment filed on or about
December 23, 2022 (file-stamped on 12/27/2022), and which was previously presented to the
Court in oral arguments. That MSJ was taken under consideration and is pending a ruling.
In addition to the basis and reasons for relief as set forth in Defendant LJP’s December
2022 Motion for Summary Judgment, LJP seeks dispositive relief concerning KRE’s DTPA claims
in this MSJ because the transaction is excluded from the DTPA’s applicability pursuant to TBCC
§17.49(g). In short, the DTPA does not apply to transactions of this size. Accordingly, as a matter
of law, KRE’s DTPA claims against LJP fail and are wholly untenable.
NOTICE OF RELIANCE ON EVIDENCE AND MSJ RELIEF SOUGHT IN PRIOR FILINGS OF RECORD
LJP provides notice of its intention to utilize and rely upon evidence, arguments and
authorities previously filed with the Court by LJP as well as the Rule 91a Motion to Dismiss and
Motion for Summary Judgment filed by Defendants Evans and 1RLP. This includes LJP’s Motion
(file-stamped 12/27/2022) and its Reply to KRE’s Response (file-stamped 1/11/2023), with
exhibits and summary judgment evidence attached thereto. LJP also relies on the Traditional
Motion for Partial Summary Judgment filed on 7/5/2022, including the summary judgment
evidence attached thereto.
BACKGROUND INFORMATION
1 For purposes of this April 2023 MSJ filing, LJP provides the following background
information pertinent to the basis for this MSJ. Plaintiff KRE was the tenant in a commercial retail
property owned by Defendant LJP. The parties entered into a Lease Agreement (“Lease”) dated
January 10, 2018. See Exb. 1. The property was commercial property located at 4820 LJ Parkway,
Sugar Land, Texas 77479. Under the terms of the Lease, Defendant as landlord would provide a
“shell” of a building structure, with Plaintiff KRE (as tenant) responsible for the entirety of the
buildout of the leased premises (defined as ““Tenant’s Work” and set forth in Exhibit C-1 to the
Lease), with LJP providing a construction allowance of $30/sq. foot to KRE for tenant buildout.
See Exb. 1, provisions 1.1(n), 2.3, and Exhibit C-1 Construction Rider. Any problems and
ramifications of the same resulting from the design and construction of the leased space buildout
by KRE would be the responsibility of KRE under the contractual terms of the Lease.
2. The Lease term was 60 months. See Exb. 1, provision 1.1(h). The monthly
“Minimum Rent” under the Lease was $6,500.00 (Exb. 1, provision (i)), with the common area
(CAM) monthly amount being $1,742.00 (Exb. 1, provision (k)). The lease confirmed these
monthly amounts to be $8,242.00/month (Exb. 1, provision (m)). A Security Deposit in the
amount of $6,500 was also required to be paid by the Tenant (Exb. 1, provision (l)). The total
square feet of commercial rental space was 2,600 (Exb. 1, provision (g)).
TBCC §17.49(G) EXEMPTION
3 TBCC §17.49(g) provides:
Nothing in this subchapter shall apply to a cause of action arising
from a transaction, a project, or a set of transactions relating to the
ame project, involving total consideration by the consumer of more
than $500,000, other than a cause of action involving a consumer's
residence.
See TBCC §17.49(g). Courts have applied this exemption to DTPA applicability have done so by
“broadly construing the large-transactions exemption” considering the purpose of §17.49(g),
which is to “maintain the DTPA as a viable source of relief for consumers in small transactions
and to remove litigation over large transactions between businesses from the scope of the DTPA.”
See McCoy v. Valvoline, LLC, 568 F. Supp. 3d 666, 676 (N.D. Tex. 2021). Courts have interpreted
the “total consideration” requirement to encompass the full value of the agreement between the
parties, rather than solely the amount in dispute in the litigation. /d. (emphasis added).
4 The Court in Citizens National Bank v. Allen Rae Investments, Inc., 142 S.W.3d
459, 473-74 (Tex. App.—Fort Worth 2004, no pet.) (copy attached hereto as Exb. 2) considered
and interpreted both the legislative intent behind TBCC §17.49(g) as well as what is meant by the
term “total consideration” for purposes of this DTPA Exemption. As the Senate and House co-
sponsors of the bill pointed out:
The reform law has eliminated many high-dollar transactions from
the reach of the DTPA. These changes were part of lawmakers’
efforts to maintain the DTPA as a viable source of relief for
consumers who encounter and are harmed by unscrupulous
business practices, but to remove from the scope of the Act ...
litigation between big businesses. Id. at 474.
[The bill co-sponsors] interpret the section to mean that ‘the DTPA
will no longer govern transactions in which the overall
consideration exceeds $500,000.’ Id. at 474-75.
Under Texas case law, "[c]onsideration is a present exchange
bargained for in return for a promise. It consists of either
a benefit to the promisor or a detriment to the promisee."
(citing Roark v. Stallworth Oil & Gas, Inc., 813 S.W.2d 492, 496
(Tex.1991)). Similarly, in the sixth edition of Black's Law
Dictionary, consideration is defined as "[s]ome right, interest,
profit or benefit accruing to one party, or some forbearance,
detriment, loss, or responsibility, given, suffered, or undertaken by
the other," and pecuniary consideration is "consideration for an
act of forbearance which consists either in money presently
passing or in money to be paid in the future." (citing to
BLACK'S LAW DICTIONARY 306-07 (6th ed.1990)) (emphasis
added).
5 Likewise, in East Hill Marine, Inc. v. Rinker Boat Co., 229 S.W.3d 813, 820-21
(Tex. App.—Fort Worth 2007, pet. denied) (copy attached as Exb. 3), the Court looked to the
amount of payments promised in the agreement, not the actual amounts paid, to determine whether
the “total consideration” was over $500,000. In East Hill Marine, the agreement in dispute
involved only a promise to pay an amount over $500,000, which was deemed sufficient to take the
transaction out of DTPA applicability, despite the claimed breach never resulting in actual
payments of that amount. East Hill Marine, Inc. v. Rinker Boat Co., 229 S.W.3d at 821. The
Court wisely reasoned and concluded, following other Texas cases, that “[t]he purpose of this
exemption is to maintain the DTPA as a viable source of relief for consumers in small
transactions and to remove litigation between businesses over large transactions from the
4
scope of the DTPA.” Id. at 820.
6 For purposes of determining whether this transaction is exempt under the DTPA,
we need only look to the actual Lease terms, as those set forth the total consideration agreed upon
by the parties in the “four corners” of the agreement. KRE’s total consideration under the Lease
was over $500,000, as the following chart reflects:
Security Deposit $ 6,500.00
Rent (60 months x $6,500.00) $ 390,000.00
CAM Charge (60 months x $1,742.00) $ 104,520.00
Total $ 501,020.00
Because the Lease involves total consideration promised to be paid that is in excess of $500,000,
the DTPA does not apply. KRE’s DTPA claims are untenable as a matter of law and should be
dismissed on this basis.
TBCC §17.49(F) EXEMPTION
7 Under TBCC §17.49(f), a claim arising from a written contract is barred if the
following three elements are satisfied:
(1) the contract relates to a transaction, a project, or a set of transactions
related to the same project involving total consideration by the
consumer of more than $100,000;
(2) in negotiating the contract the consumer is represented by legal
counsel who is not directly or indirectly identified, suggested, or
selected by the defendant or an agent of the defendant; and
(3) the contract does not involve the consumer's residence.
8 All three elements exist in this case. First, the consideration at issue is in excess of
$500,000, which exceeds the $100,000 threshold requirement for exemption under this section.
Secondly, the Lease Agreement itself conclusively establishes that KRE was represented by legal
counsel, as the contract signed by KRE’s representative states so. See Exb. 1, provision 22.20
[Notwithstanding the fact that this Lease (in its original form) was prepared by Landlord,
this Lese has been reviewed by Tenant and its legal counsel_and the terms and
provisions hereof have been negotiated by both parties....] (emphasis added). In Arnold &
Co., LLC v. David K. Young Consulting, LLC, the court found that the section 17.49(f) exemption
was met when the parties stipulated in their contract that they had “engaged and consulted” with
legal counsel. No. SA:13-CV-146-DAE, 2015 WL 268520, at *5 (W.D. Tex. Jan. 21, 2015) (not
reported in F. Supp. 3d). We know this to be true, as the Lease proposed by Landlord LJP was
amended pursuant to negotiated terms requested by Tenant. See Exb. 1, provision 24.1.
9. Accordingly, for these additional reasons, Plaintiff KRE’s DTPA claims are
exempted from the DTPA and fail as a matter of law. The Court should grant LJP’s MSJ and
dismiss all of KRE’s DTPA claims.
Wherefore, Defendant LJ Parkway respectfully requests that the Court grant its Traditional
Motion for Summary Judgment or Partial Summary Judgment based on limitations and contractual
disclaimer and non-liability provisions, and that the Court grant LJ Parkway such other and further
relief, at law or in equity, to which LJ Parkway may be justly entitled and this Court deems proper.
Respectfully submitted,
KRENEK LAW OFFICES, PLLC
By: /s/ EddieM. Krenek
Eddie M. Krenek
Texas Bar No. 11724980
Email: edkrenek@kreneklaw.com
Tricia K. Krenek
Texas Bar No. 24031324
Email: tkthompson@kreneklaw.com
21555 Provincial Blvd.
Katy, Texas 77450
Telephone (281) 578-7711
Facsimile (281) 578-8988
Attorneys for LJ Parkway, LLC
CERTIFICATE OF SERVICE
I hereby certify that a true and correct copy of the foregoing was served on all counsel of
record in compliance with the Texas Rules of Civil Procedure on the 12" day of April 2023, as
follows:
Mr. Kevin Pennell Served via Electronic Service Provider and/or
Pennell Law Firm PLLC via email: kevin@pennellfirm.com
19 Briar Hollow Ln., Suite 110
Houston, TX 77027
Phone: (713) 965-7568
Fax: (713) 583-9455
Counsel for Kennedy Roofing & Exteriors, Inc.
And Nicholas Kennedy
Mr. Pascal Paul Piazza Served via Electronic Service Provider and/or
ZUKOWSKI, BRESENHAN & PIAZZA, LLP via email: ppp@zbplaw.com
1177 West Loop South, Suite 950
Houston, Texas 77027
Phone: (713) 965-9969
Fax: (713) 963-9169
Counsel for Kennedy Roofing & Exteriors, Inc.
Mr. Andrew K. Meade Served via Electronic Service Provider and/or
MEADE NEESE & BARR LLP via email: ameade@mnblip.com
2118 Smith Street
Houston, Texas 77002
Phone: (713) 355-1200
Counsel for Jack Beaumont Evans and IRLP, LLC
By: /s/ Eddie M. Krenek
Eddie M. Krenek
Exhibit 1
(
LEASE AGREEMENT
ARTICLE I. BASIC LEASE PROVISIONS AND LIST OF EXHIBITS, AK
11 Basic Lease Provisions.
(a) DATE OF THIS LEASE: January 10, 2018
(b) LANDLORD NAME: LJ Parkway, LLC
© ADDRESS OF LANDLORD FOR NOTICES:
15010 Lakefair Dr.
Richmond, TX 77406
@) TENANT NAME: _Kennedy Roofing & Exteriors
© ADDRESS OF TENANT FOR NOTICES:
, or the Leased Premises
(f) TENANT'S TRADE NAME: Kennedy Roofing & Exterior:
8, PREMISES: An area of approximately 2. 600 square feet of Floor Area known as Suite
__20__ located at 4820 LJ Parkway, Sugar Land, Texas 77479 (the “Premises”) within the Shopping
Center (the “Center”), located as shown on Exhibit "A-1" hereto. The Center is located on a tract of land
described in Exhibit "A." The land, and the buildings and other improvements thereon are sometimes
referred to herein as the “Project.”
(h) LEASE TERM: This Lease shall become effective upon execution hereof by Landlord
{notwithstanding the date indicated in Article 1.1(a) above]. The Commencement Date (“Commencement
Date”) is defined as 270 days after tender of possession of the Leased Premises to Tenant, The
Termination Date (“Termination Date”) is defined as last day of the 60" full calendar month after the
commencement.
i) MINIMUM RENT: Commencing on the Commencement Date, Minimum Rent shall be the
following sums (due and payable as provided in Article III of this Lease):
Lease Months Monthly Rent
1-60 $6,500.00
@ TENANT'S PROPORTIONATE SHARE: 9.29%,
(k) COMMON AREA FEE: $1,742.00 (See Article 4.5)
® SECURITY DEPOSIT: $6,500.00
Inet Tenant__ WH
Page 1 of 47 KENO39 '
Exhibit
(m) PREPAID RENT (T~ BE APPLIED TO
THE FIRST MONTiss RENT AND CAM): $8,242.00
(n) CONSTRUCTION ALLOWANCE: $30.00 per square foot.
(0) PERMITTED USE: The Premises shall be used only for the following: Operation of a roofing and
exteriors business office and for no other purpose (See Article V).
() INITIAL ESTIMATED MONTHLY OPERATING EXPENSE PAYMENTS: (estimates only and
subject to adjustment to actual costs and expenses according
to the remaining provisions of this Lease):
1. Common Area Charges $.15 PSF
2. Taxes: $.42 PSF
3. Insurance: $.10 PSF
Total $.67 PSF
(s) BROKER(S): Landlord will pay leasing commissions based on listing agreement. JBLK Texas
Land & Leases serving as the Landlord representative and Stephen Montoya of MontLargo Properties
representing the Tenant.
® Definitions of certain words, terms or provisions in this Lease are set out in Article XXIII below,
PHIS LEASE IS SUBJECT TO ARBITRATION AS PROVIDED IN PARAGRAPH 22.16.
12 List of Exhibits, The Exhibits and/or Addenda listed below as being part of this Lease are attached
to and are to be construed as part of, and covenants under, this Lease.
C "A" Legal Description
"A-1" Site Plan
"B" Rules and Regulations
"C-1" Construction Rider
"D" Sign Specifications
O "E" Guaranty
13 Landlord's Work. (See Exhibit C-1, paragraph A)
ARTICLE II. LEASED PREMISES; TERM; CONSTRUCTION.
21 Landlord hereby leases and demises to Tenant and Tenant hereby accepts from Landlord on the
terms set forth herein, the Premises together with all appurtenances specifically granted in this Lease. Landlord,
without limiting its rights hereunder, (a) retains and excludes from this demise (i) the exterior faces of the walls
of the Premises (except as otherwise expressly set out in this Lease), (ii) the roof and, as applicable, the area, if
any, between the ceiling or drop ceiling and the floor or roof above and (iii) the land under the Premises, and (b)
reserves unto itself the right to install, connect, maintain, use, repair, remove, and replace the Utility Facilities
‘ocated in the Premises, in locations which will not materially interfere with Tenant's use of the Premises, and the
right to enter into the Premises in connection therewith.
2.2 Tenant shall have and hold the Premises for the Lease Term set forth in Section 1.1(i), unless
sooner terminated as hereinafter provided.
Initiat taney ~ Initial Tenant NY Page 2 of A7
KEN040 ?
Exhibit 1
2.3 Landlord shall perform Landlord’s Work (as set out in paragray.c A of Exhibit “C-1”), and Tenant
shall with due diligence cause to be performed the Tenant's Work, pursuant to the plans and specifications therefor
subject to approval in writing by Landlord, and install in the Premises its trade fixtures, furniture and equipment
(as provided for on Exhibit "C"-1 Tenant’s Work); Tenant shall open the Premises to the public for business not
later than 180 days after the Premises is delivered by Landlord to Tenant.
ARTICLE III. RENT AND SECURITY DEPOSIT.
ot
31 The Rent specified in Section 3.2 shall accrue hereunder from the Commencement Date.
3.2 Tenant promises and agrees to pay to Landlord by mail or in person at the address of Landlord as
set forth in Section 1.1(c), or such other place as Landlord may from time to time designate in writing, the
following Rent:
(a) Minimum Rent as set forth in Section 1.1(j);
(b) The Common Area Maintenance Fee as set forth in Section 4.5; and
©) All other sums and charges due by Tenant to Landlord under the terms of this Lease.
All such sums (and other charges or payments provided to be paid to Landlord herein) are sometimes
referred to herein as “Rent.”
3.3 Except as otherwise expressly provided herein, all Rent shall be due and payable monthly, in
advance, beginning on the Commencement Date, without demand, notice, deduction or setoff, and continuing
hereafter, on the first day of each month during the Lease Term. In the event any installment of Rent is not
received within five days after the date on which such amount is due, Tenant shall pay as additional rent, and as
a late chargeten percent (10%) of the amount past due, plus the amount of any attorneys’ fees reasonably incurred
by Landlord in connection therewith for each such late payment. Tenant shall also pay an administrative charge
of $50.00 for each check returned unpaid for any reason. If Tenant is late in making payments due hereunder
(including, but not limited to, Minimum Rent), Landlord may at any time thereafter, upon written notice to Tenant,
require that (until further notice) all payments of Rent be made by certified or cashier's check, The first month's
Rent and other charges or fees shall be prorated from the Commencement Date through and including the last day
of the month in which the Commencement Date occurs and shall be paid in advance on the Commencement Date.
Contemporaneously with the execution of this Lease by Tenant, Tenant shall pay to Landlord the Prepaid Rent
(in the amount set forth in Section 1.1(n)) which shall be applied to the Rent and CAM for the first full month of
the Term.
3.4 Tenant shall, contemporaneously with the execution of this Lease, deposit with Landlord the
Security Deposit. If Tenant shall fail to pay any installment of Rent when due, said Security Deposit may, at the
option of Landlord, be applied to any such sums due and unpaid, and if Tenant violates any of the other terms,
covenants and conditions of this Lease, said Security Deposit may be applied to any damages suffered as a result
of Tenant's default to the extent of the amount of the damages suffered. Should any of the Security Deposit be
used to pay sums due for any reason, and if this Lease is kept in full force and effect at the option of Landlord,
Tenant shall reimburse Landlord the amount of such depletion, within 10 days after notice to Tenant by Landlord
of such depletion. Should Tenant comply with all of the terms, covenants and conditions of this Lease, and
promptly pay all of the Rent herein provided as it falls due, the Security Deposit shall be returned to Tenant in
full (but without interest) within 60 days after Tenant requests in writing the return of the Security Deposit, which
‘equest shall include the forwarding address of Tenant and the warranty and representation of Tenant (and the
officer, partner or agent signing on behalf of Tenant) that Tenant has fulfilled all of its obligations hereunder.
Landlord may deliver the Security Deposit to the assignee of Landlord's interest in the Premises in the event that
such interest be sold or assigned, and thereupon Landlord shall be discharged from further liability with respect
to such Security Deposit.
Initial tendon 54 intial Tenant__ NL Page 3 of 47 KENO41 °
Exhibit 1
ARTICLE IV. COMMON AnfA
41 Common Area: All portions of the Center which Landlord may from time to time make available
(or designate) for the general, non-exclusive use, and benefit of Tenant, other tenants and their Permitees. The
Common Areas shall include without limitation the following, to the extent same are made available to serve
more than one occupant: parking areas, traffic lanes, traffic control facilities, entrances and exits from and to
public streets, sidewalks, landscaping, lighting facilities, Utility Facilities, fire corridors, restrooms, truck ramps,
loading facilities and docks, as the same may exist from time to time.
4.2 Common Area Expense: Landlord's actual costs of owning, operating, maintaining and
repairing the Common Areas with respect to periods within the Lease Term, including but not limited to, all costs
with respect to such periods incurred by Landlord with respect to the following: security services, if any, (except
that Landlord shall not be required to provide any security services at any time); lighting, cleaning, removing
debris from, maintaining, restriping and repairing the parking areas; providing signs or personnel for traffic
control; providing and maintaining landscaping in the Common Area; maintaining, repairing and lighting traffic
islands, loading and service areas, service drives, and drainage facilities; cleaning, maintaining, repainting and
repairing exterior walls of buildings within the Center; maintaining and repairing Utility Facilities; maintaining,
repairing and replacing roofs; any fees, dues or other charges required to be paid to any person, association or
entity pursuant to the terms of any covenants, conditions or restrictions of record affecting the Center;
maintenance, repair, inspection and depreciation (solely in Landlord's discretion) of all machinery and equipment
used in the operation or maintenance of the Common Area; Insurance Charges and Tax Charges; the cost of any
item used in connection with the operation, maintenance or repair of the Common Area, provided that if any such
item costs more than $10,000.00 and is, in Landlord's reasonable judgment, properly considered a capital item,
the cost of such item (including financing costs) shall be spread over the life of such item (as reasonably
determined by Landlord) and only the portion of such cost which pertains to the period in question shall be
ncluded in the Common Area Expenses for such period; and wages and salaries of all personnel engaged in the
operation, reasonable management fees, maintenance, traffic control or access control of the Center, including
taxes, insurance, and benefits relating thereto (provided, however, that if during the Lease Term such personnel
or entities are working on projects being periodically developed or operated by Landlord as well as the Center,
their wages, salaries, fees, and related expenses, shall be appropriately allocated by Landlord among all of such
projects and only that portion of such expenses reasonably allocable to the Center shall be included in the
calculation of the Common Area Maintenance Fee); plus an amount equal to 15% of all of the foregoing costs
(excluding salaries and expenses of such property managers for purposes of such calculation only) to cover
Landlord's administrative costs. Common Area Expenses shall not increase by more than 7% per year, excluding
Taxes and Insurance costs
4.3 Landlord shall operate and maintain the Common Area in such manner as Landlord in its sole
discretion determines to be in the best interests of the Center. Landlord reserves the right at its sole discretion to
change from time to time the size, dimensions and location of the Common Area as shown on Exhibit "A-1,"
including without limitation, the entrances, exits, lanes, size, boundaries and location of the parking areas; and
the size, dimensions, identity and type of any building(s) shown on Exhibit "A-1"; and has the further right to
construct any structure, or improvements, temporary or permanent, on any part of the Common Area without the
consent of the Tenant subject to no restriction except that without the prior consent of Tenant (subject to the
provisions of Articles XIII and XIV hereof), there shall be no material reduction of the size and dimension of, or
access to the Premises. So long as Tenant is not in default hereunder, Tenant and its Permitees shall have the
nonexclusive license to use the Common Area as constituted from time to time in common with Landlord, other
tenants of the Center and other persons entitled to use the same, which license shall be subject to reasonable rules
and regulations as Landlord may from time to time prescribe. Tenant shall not solicit any business within the
“ommon Area or take any action which would interfere with the rights of other persons to use the Common Area.
4.4 The use of the Common Area by employees of Tenant may be restricted by Landlord from time to
time. Landlord shall have the right to maintain and operate lighting facilities on all the parking areas and to
control all the parking and other Common Area, and to make reasonable rules regulating the use, thereof,
Initial tande 6 2, Initial Tenant NK Page 4 of A7
KEW042 *
Exhibit 1
fs
including, without limitation, the rir“ ° to designate and regulate employee Pi -“ing areas, and to do and perform
such other reasonable acts with respect to the Common Area as in the ju went of Landlord and Landlord's
counsel may be legally necessary, including temporarily closing any part of the Common Area to prevent a
iedication thereof to the public or to prevent the public from obtaining prescriptive rights. Without limitation of
the foregoing, Landlord expressly reserves the right to require that Tenant and other tenants in the Shopping
Center cause their employees to park only in areas specifically designated by Landlord.
45 Tenant’s “Common Area Maintenance Fee” (sometimes herein referred to as “CAM”) for the
period commencing on the Commencement Date, and ending on the Termination Date.During December of each
calendar year or as soon as possible thereafter as practicable, Landlord will give Tenant written notice of its
estimated of CAM rent payable for the ensuing calendar year. On or before the first of each month during the
ensuing calendar year, Tenant will pay to Landlord 1/12" of such estimated amounts, provided that if such notice
is not given in December, Tenant will continue to pay on the basis of the prior’s estimate until the month after
notice is given. Within one hundred twenty (120) days after the end of each year during the Lease Term, Landlord
shall compute and determine the actual Common Area Expenses for the relevant prior calendar year. Landlord
shall give Tenant notice of such Common Area Expenses and notice of Tenant's Common Area Maintenance Fees
payable with respect to such period. If Tenant's actual Common Area Maintenance Fee with respect to such
period exceeds the amount therefor previously paid by Tenant, Tenant shall pay Landlord the deficiency in each
such case within 30 days following notice from Landlord; however, if the aforesaid amount previously paid by
Tenant towards Tenant's actual Common Area Maintenance Fee is in excess of Tenant's actual Common Area
Maintenance Fee with respect to such period, then the balance thereof shall be held by Landlord and applied to
the payment of Tenant's Common Area Maintenance Fee next due; except that any amounts remaining at the
termination of this Lease shall be offset against any amounts then owing by Tenant to Landlord under any of the
terms of this Lease, and any remaining net surplus shall then be refunded by Landlord to Tenant.
ARTICLE V. USE AND CARE OF PREMISES.
Ss The Premises shall be used and occupied by Tenant only for the Permitted Use under Tenant's
Trade Name, and for no other purpose or use, and under no other trade name, without the prior written consent of
Landlord. Tenant acknowledges that actual and substantial detriment will result to Landlord and the other tenants
of the Center in the event there is a deviation from the Permitted Use without the prior written consent of Landlord.
Tenant shall not make or permit any unlawful use of the Premises, Tenant shall not at any time leave the Premises
vacant, but shall in good faith continuously throughout the term of this Lease conduct and carry on in the Premises
the type of business for which the Premises are leased, in accordance with the best standards of operation of such
business, for at least 40 hours of every week. In the event the exterior lights for the Premises are individually
controlled by Tenant from the Premises, then Tenant, at Tenant's sole cost and expense, shall keep all lights
illuminating its exterior sign, if any, and all lights on the canopy in front of the Premises illuminated from dusk
through 10 o'clock P.M. every day, Monday through Sunday. If Landlord controls all exterior lighting, all costs
incurred by Landlord in connection therewith shall be included in the Common Area Maintenance Fee.
5.2 Tenant shall not, without Landlord's prior written consent, perform any act or fail to perform any
act, keep anything within the Premises or use the Premises for any purpose that increases the insurance premium
cost or invalidates any insurance policy carried on the Premises or on other parts of the Center. If Landlord does
give written consent to Tenant pursuant to the above sentence, then Tenant shall be liable, at its sole cost and
expense, for the amount of any increase in the insurance premium cost resulting from such act or omission to
which Landlord has consented.
5.3 The term "Hazardous Substances," as used in this Lease, shall mean pollutants, contaminants, toxic
or hazardous wastes, radioactive materials or any other substances, the use and/or the removal of which is required
wr the use of which is restricted, prohibited or penalized by any "Environmental Law," which term shall mean any
sederal, state or local statute, ordinance, regulation or other law of a governmental or quasi-governmental
authority relating to pollution or protection of human health or the environment or the regulation of the storage
or handling of Hazardous Substances. Tenant hereby agrees that: (i) no activity will be conducted on the Premises
that will produce any Hazardous Substance; (ii) the Premises will not be ed in any manner for the storage of
Initial Langa b¢ Initial Tenant Nie _ P a g e 5 Z 7
KEN043 *
Exhibit 1
any Hazardous Substances; (iii) Ten * will not permit any Hazardous Substap ~s to be brought onto the Premises
or the Center. If at any time during ur after the term of this Lease, any Hazarucus Substance is found located on
the Premises, or on the Center resulting from the actions of Tenant, Tenant's agents, employees or contractors, or
anyone for whose actions Tenant is liable, the same shall at Landlord's election either (x) be immediately removed
by Tenant, with proper disposal, and all required clean-up procedures shall be diligently undertaken by Tenant at
its sole cost pursuant to all Environmental Laws or (y) Landlord may remove the same, and Tenant shall, within
10 days after a demand from Landlord, reimburse Landlord for all actual costs of inspection, monitoring and/or
remediation. Tenant shall make all notifications and shall obtain and maintain in full force all permits, licenses,
registrations, or similar authorizations required under any Environmental Law for the operations or activities of
Tenant at the Premises. Tenant agrees to indemnify and hold Landlord harmless from all claims, actions,
liabilities, costs, expenses, damages, penalties and obligations of any nature arising from or as a result of any
contamination of the Premises with Hazardous Substances, or any contamination of the Center resulting from the
actions of Tenant, Tenant's agents, employees or contractors, or anyone for whose actions Tenant is liable, or
otherwise arising from the use of the Premises by Tenant. Tenant shall store, use, handle or dispose of all
permitted Hazardous Substances, necessary for use and operation of Tenant’s business, used on the Premises in
the ordinary course of Tenant's business in strict compliance with all Environmental Laws. The terms of this
Section 5.3 shall survive the termination or expiration of this Lease.
5.4 Tenant shall not, without Landlord's prior written consent, conduct or permit to be conducted
within the Premises any fire, auction, bankruptcy, "lost-our-lease," "going-out-of-business," or similar sales; nor
permit any objectionable or unpleasant odors or loud noises to emanate from the Premises; nor place or permit
any radio, television or other antenna, loud speaker or amplifier, or flashing lights on the roof or outside the
Premises or where the same can be seen or heard outside the building; nor place or display any signs, advertise-
ments or other items (other than permitted under Section 8.1) in any windows or glass store fronts. In no event
shall Tenant take any other action which would disturb or endanger other tenants of the Center, or unreasonably
interfere with their use of their respective premises or create a nuisance, or omit an unreasonable odor from the
Premises or create an annoyance to Landlord or to other tenants.
5:5 Tenant, at its sole cost and expense, shall obtain (and upon request deliver to Landlord) all permits
and licenses and pay all fees required for the transaction of its business in the Premises, Tenant shall not violate
any applicable laws, ordinances, rules, governmental regulations, or restrictive covenants now in force or which
may hereafter be in force pertaining to the Premises or the operation of Tenant's business therein. Tenant
acknowledges that the Center may be subject to restrictive covenants that may affect Tenant's business at the
Premises, Tenant hereby waives any claims or causes of action against Landlord arising out of any violation by
Tenant of any applicable restrictive covenants; and Tenant shall indemnify and hold harmless Landlord from all
claims, causes of action, costs, losses, damages and attorneys' fees incurred by Landlord in connection with any
such violation by Tenant, Tenant shall reimburse Landlord for Tenant’s Proportionate Share of property owners’
association dues and assessments, if any, within 30 days after a request for payment from Landlord.
5.6 Tenant shall take good care of the Premises and keep the same free from waste or nuisance at all
times. Tenant shall not locate or install or cause to be located or installed on the sidewalks, service area, service
corridors or other portions of the Common Area (as applicable) immediately adjoining the Premises or on the
storefront any bicycle racks, newspaper holder stands, vending machines of any kind, mailboxes, telephone
booths, trash or refuse receptacles, "no parking" or “reserved parking” signs or any other device of a similar nature
without the prior written approval of Landlord. Tenant shall keep the Premises, including windows and signs and
service ways, loading areas and other portions of the Common Area immediately adjacent to the Premises neat,
clean, and free from dirt or rubbish at all times and shall store all trash within the Premises, and shall arrange for
the regular pickup of such trash and garbage at Tenant's expense. In the event Tenant fails to do so, then Landlord
shall have the right to cause such trash to be picked up at the sole cost and expense of Tenant. Tenant shall on
iemand pay any cost and expense of picking up such trash incurred by Landlord plus 10% of such cost and
expense (to cover Landlord's overhead and administrative costs with respect thereto). All trash receptacles or
dumpsters installed by Tenant must comply with any statute, ordinance, rule, regulation, or restrictive covenant
now or hereafter in force governing the location, use or manner of their placement or Landlord shall have the
right to remove from the Center without notice any such receptacles that do ot so comply. Tenant shall also
Initial tan f Initial Tenant__ Ny Page 6 ofé
KENO044 °
Exhibit 1
maintain its grease traps (if any), ay “ep all pipes and drains free from obs} tion and shall be responsible for
all damages or loss resulting from .enant’s failure to do so. Tenant shall vx solely responsible for any fine,
penalty or damage that may result from its failure to comply with this Section. Receipt and delivery of goods and
nerchandise and removal of trash shall be made only by way of the service entrance, and shall be subject to such
regulations as Landlord may from time to time prescribe. Without limitation of the foregoing, Landlord shall
have the right to require that Tenant share a dumpster with one or more other tenants in the Shopping Center; in
such event, Landlord shall make arrangements for such dumpster to be emptied on a regular basis and Tenant
shall pay to Landlord as Rent, Tenant's Proportionate Share of such dumpster charges.
ARTICLE VI. MAINTENANCE AND REPAIR OF PREMISES.
6.1 Landlord shall maintain only the foundation, the structural portions of the exterior walls (except
store front, windows, plate glass, doors, door closure devices, window and door frames, moldings, locks, hardware
and painting and other treatment of interior walls, which shall all be maintained by Tenant) and roof of the
Premises in good repair; provided, however, that Landlord shall not be required to make any repairs occasioned
by the act, omission or negligence of Tenant, or its Permitees, it being expressly agreed that any loss, damage or
injury arising out of, or as a result of Tenant’s acts or omissions, shall be the sole obligation of Tenant. In the
event that the Premises should become in need of repairs required to be made by Landlord hereunder, Tenant
shall give immediate written notice thereof to Landlord; and Landlord shall not be responsible in any way for
failure to make any such repairs until a reasonable time shall have elapsed after delivery of such written notice.
6.2 Tenant shall maintain the Premises clean, and in good order and condition and shall make all
needed repairs thereto (except only for repairs required to be made by Landlord under the provisions of Section
6.1 above), including, without limitation, mechanical, electrical and plumbing, HVAC, maintenance of all doors
and doorways, all utility connections and replacement of cracked or broken glass. Tenant shall comply at its sole
cost and expense with all governmental laws, ordinances and regulations applicable to the Premises. If any repairs
‘equired to be made by Tenant hereunder are not made within 10 days after written notice has been delivered to
Tenant by Landlord, Landlord may at its option, in addition to its other remedies hereunder, make such repairs
without liability to Tenant for any loss or damage which may result to Tenant's stock or business by reason of
such repairs, Tenant shall pay to Landlord upon demand the actual cost of such repairs plus 10% of such cost (to
cover Landlord's overhead and administrative costs with respect thereto). Without limitation of the foregoing,
Tenant, at Tenant’s cost, shall have sole responsibility for maintenance and upkeep of the heating, ventilating and
air conditioning system, the sprinkler system (if any), that portion of the sewer system which exclusively serves
the Premises (unless damage to the Center's sewer system is caused by Tenant's use or misuse, in which event
Tenant shall be responsible for the repair of all damage caused thereby).
6.3 Any Tenant Work or other alterations or modifications of the Premises causing venting, opening,
sealing, waterproofing or in any way penetrating or altering of the roof ("Roof Modifications") shall be performed
at Tenant's expense by Landlord’s contractor ("Roof Contractor"). In the event any such Roof Modifications are
to be made, Tenant shall notify Landlord thereof, and shall furnish Landlord a reasonably detailed statement of
the work to be performed on the roof, and must first receive Landlord’s written consent to Tenant’s proposed
work on or through the roof.
6.4 Tenant has inspected the Premises, is familiar with its condition and accepts same in its present
"AS IS" condition, including any latent defects, Tenant acknowledges that Landlord is not obligated to do any
further construction or make any additional improvements to the Premises except which is set out in Exhibit C-
1
ARTICLE VII. ALTERATIONS AND FIXTURES.
21 Tenant shall not, without on each occasion obtaining Landlord's prior written consent: (a) alter or
change the exterior or architectural treatment of the Premises; (b) paint or deporate any part of the exterior of the
Initial tendon j74 Initial Tenant NK P a g e 7
of47 KENO45 ’
Exhibit 1
Premises; (c) make any alterations additions to the Premises or permit th aking of any holes in the walls,
eilings or floors thereof or in the rouf of any of the building; (d) injure, ovet.vad, deface or otherwise harm the
Premises or any part thereof; or (e) permit the use of any forklift or tow truck, or any other mechanically powered
nachine or equipment for handling freight in the Premises or other portion of the Center; provided, however, that
Tenant may perform Tenant's Work and install unattached, movable furniture and trade fixtures and equipment.
All repairs, replacements, alterations, additions, improvements, plate glass, exterior doors, overhead sprinkler
systems (if any), floor coverings and fixtures (other than unattached, movable trade fixtures) including all air
conditioning, electrical, mechanical and plumbing machinery and equipment, exhaust hoods and water heaters,
which may be made or installed by either party hereto upon the interior or exterior of the Premises shall become
the property of Landlord without credit or compensation to Tenant at the termination of this Lease for any reason
whatsoever, and at the termination of this Lease shall remain upon and be surrendered with the Premises, unless
Landlord requests their removal, in which event Tenant shall, prior to such termination, remove the same and
restore the Premises to their original condition, normal wear and tear excepted, at Tenant's expense. At the
expiration of the Lease Term (and provided Tenant is not then in default under this Lease), all moveable trade
fixtures and equipment owned by Tenant used at (and not permanently attached to) the Premises shall be promptly
removed by Tenant.
ARTICLE VIII. SIGNS AND STORE FRONTS.
8.1 Tenant, at Tenant’s cost, shall install a storefront sign on the fascia above the Premises, provided
however Tenant shall first furnish Landlord with specifications of such sign, and Tenant must first receive
Landlord’s written approval of such sign before installing the same. Tenant shall not, without Landlord's prior
written consent in each instance: (a) make any changes to the store front, (b) install any exterior lighting, shades
or awnings, or any exterior decorations or paintings, (c) place or install any reflective material on the doors,
windows or store front, or (d)
Preview
Filed 4/12/2023 8:36 PM Beverley McGrew Walker District Clerk Fort Bend County, Texas Sylvie Le CAUSE NO. 21-DCV-280353 KENNEDY ROOFING & EXTERIORS, INC. § IN THE DISTRICT COURT OF § Vv. FORT BEND COUNTY, TEXAS LJ PARKWAY, LLC 43474 JUDICIAL DISTRICT DEFENDANT LJ PARKWAY LLC’S APRIL 2023 TRADITIONAL RULE 166A MOTION FOR SUMMARY JUDGMENT BASED ON DTPA EXEMPTIONS IN TEX. BUS. & COMM. CODE §17.49(G) AND IN TEX. BUS. & COMM. CODE §17.49(F) Defendant LJ PARKWAY, LLC (“Defendant” or “LJ Parkway” or “LJP”) files this TRADITIONAL [R166A[ MOTION FOR SUMMARY JUDGMENT BASED ON DTPA EXEMPTIONS IN TEx. Bus. & COMM. CODE (“TBCC”) §17.49(g) and (f) (“MSJ”) against Plaintiff KENNEDY ROOFING & EXTERIORS, INC. (“Plaintiff’ or “Kennedy Roofing” or “KRE”). KRE’s DTPA claims are not viable because the transaction at issue involved consideration, as established by the face of the transaction agreement, in excess of $500,000.00, and is not a transaction involving the consumer’s residence. See TBCC §17.49(g). Likewise, the DTPA excludes transactions involving total consideration by the “consumer” of more than $100,000 when the consumer is 9 o9? represented by legal counsel and the contract does not involve the “consumer Ss residence. See TBCC §17.49(f). As such, the transaction is excluded from applicability under the DTPA. Pending before the Court is LJP’s Motion for Summary Judgment filed on or about December 23, 2022 (file-stamped on 12/27/2022), and which was previously presented to the Court in oral arguments. That MSJ was taken under consideration and is pending a ruling. In addition to the basis and reasons for relief as set forth in Defendant LJP’s December 2022 Motion for Summary Judgment, LJP seeks dispositive relief concerning KRE’s DTPA claims in this MSJ because the transaction is excluded from the DTPA’s applicability pursuant to TBCC §17.49(g). In short, the DTPA does not apply to transactions of this size. Accordingly, as a matter of law, KRE’s DTPA claims against LJP fail and are wholly untenable. NOTICE OF RELIANCE ON EVIDENCE AND MSJ RELIEF SOUGHT IN PRIOR FILINGS OF RECORD LJP provides notice of its intention to utilize and rely upon evidence, arguments and authorities previously filed with the Court by LJP as well as the Rule 91a Motion to Dismiss and Motion for Summary Judgment filed by Defendants Evans and 1RLP. This includes LJP’s Motion (file-stamped 12/27/2022) and its Reply to KRE’s Response (file-stamped 1/11/2023), with exhibits and summary judgment evidence attached thereto. LJP also relies on the Traditional Motion for Partial Summary Judgment filed on 7/5/2022, including the summary judgment evidence attached thereto. BACKGROUND INFORMATION 1 For purposes of this April 2023 MSJ filing, LJP provides the following background information pertinent to the basis for this MSJ. Plaintiff KRE was the tenant in a commercial retail property owned by Defendant LJP. The parties entered into a Lease Agreement (“Lease”) dated January 10, 2018. See Exb. 1. The property was commercial property located at 4820 LJ Parkway, Sugar Land, Texas 77479. Under the terms of the Lease, Defendant as landlord would provide a “shell” of a building structure, with Plaintiff KRE (as tenant) responsible for the entirety of the buildout of the leased premises (defined as ““Tenant’s Work” and set forth in Exhibit C-1 to the Lease), with LJP providing a construction allowance of $30/sq. foot to KRE for tenant buildout. See Exb. 1, provisions 1.1(n), 2.3, and Exhibit C-1 Construction Rider. Any problems and ramifications of the same resulting from the design and construction of the leased space buildout by KRE would be the responsibility of KRE under the contractual terms of the Lease. 2. The Lease term was 60 months. See Exb. 1, provision 1.1(h). The monthly “Minimum Rent” under the Lease was $6,500.00 (Exb. 1, provision (i)), with the common area (CAM) monthly amount being $1,742.00 (Exb. 1, provision (k)). The lease confirmed these monthly amounts to be $8,242.00/month (Exb. 1, provision (m)). A Security Deposit in the amount of $6,500 was also required to be paid by the Tenant (Exb. 1, provision (l)). The total square feet of commercial rental space was 2,600 (Exb. 1, provision (g)). TBCC §17.49(G) EXEMPTION 3 TBCC §17.49(g) provides: Nothing in this subchapter shall apply to a cause of action arising from a transaction, a project, or a set of transactions relating to the ame project, involving total consideration by the consumer of more than $500,000, other than a cause of action involving a consumer's residence. See TBCC §17.49(g). Courts have applied this exemption to DTPA applicability have done so by “broadly construing the large-transactions exemption” considering the purpose of §17.49(g), which is to “maintain the DTPA as a viable source of relief for consumers in small transactions and to remove litigation over large transactions between businesses from the scope of the DTPA.” See McCoy v. Valvoline, LLC, 568 F. Supp. 3d 666, 676 (N.D. Tex. 2021). Courts have interpreted the “total consideration” requirement to encompass the full value of the agreement between the parties, rather than solely the amount in dispute in the litigation. /d. (emphasis added). 4 The Court in Citizens National Bank v. Allen Rae Investments, Inc., 142 S.W.3d 459, 473-74 (Tex. App.—Fort Worth 2004, no pet.) (copy attached hereto as Exb. 2) considered and interpreted both the legislative intent behind TBCC §17.49(g) as well as what is meant by the term “total consideration” for purposes of this DTPA Exemption. As the Senate and House co- sponsors of the bill pointed out: The reform law has eliminated many high-dollar transactions from the reach of the DTPA. These changes were part of lawmakers’ efforts to maintain the DTPA as a viable source of relief for consumers who encounter and are harmed by unscrupulous business practices, but to remove from the scope of the Act ... litigation between big businesses. Id. at 474. [The bill co-sponsors] interpret the section to mean that ‘the DTPA will no longer govern transactions in which the overall consideration exceeds $500,000.’ Id. at 474-75. Under Texas case law, "[c]onsideration is a present exchange bargained for in return for a promise. It consists of either a benefit to the promisor or a detriment to the promisee." (citing Roark v. Stallworth Oil & Gas, Inc., 813 S.W.2d 492, 496 (Tex.1991)). Similarly, in the sixth edition of Black's Law Dictionary, consideration is defined as "[s]ome right, interest, profit or benefit accruing to one party, or some forbearance, detriment, loss, or responsibility, given, suffered, or undertaken by the other," and pecuniary consideration is "consideration for an act of forbearance which consists either in money presently passing or in money to be paid in the future." (citing to BLACK'S LAW DICTIONARY 306-07 (6th ed.1990)) (emphasis added). 5 Likewise, in East Hill Marine, Inc. v. Rinker Boat Co., 229 S.W.3d 813, 820-21 (Tex. App.—Fort Worth 2007, pet. denied) (copy attached as Exb. 3), the Court looked to the amount of payments promised in the agreement, not the actual amounts paid, to determine whether the “total consideration” was over $500,000. In East Hill Marine, the agreement in dispute involved only a promise to pay an amount over $500,000, which was deemed sufficient to take the transaction out of DTPA applicability, despite the claimed breach never resulting in actual payments of that amount. East Hill Marine, Inc. v. Rinker Boat Co., 229 S.W.3d at 821. The Court wisely reasoned and concluded, following other Texas cases, that “[t]he purpose of this exemption is to maintain the DTPA as a viable source of relief for consumers in small transactions and to remove litigation between businesses over large transactions from the 4 scope of the DTPA.” Id. at 820. 6 For purposes of determining whether this transaction is exempt under the DTPA, we need only look to the actual Lease terms, as those set forth the total consideration agreed upon by the parties in the “four corners” of the agreement. KRE’s total consideration under the Lease was over $500,000, as the following chart reflects: Security Deposit $ 6,500.00 Rent (60 months x $6,500.00) $ 390,000.00 CAM Charge (60 months x $1,742.00) $ 104,520.00 Total $ 501,020.00 Because the Lease involves total consideration promised to be paid that is in excess of $500,000, the DTPA does not apply. KRE’s DTPA claims are untenable as a matter of law and should be dismissed on this basis. TBCC §17.49(F) EXEMPTION 7 Under TBCC §17.49(f), a claim arising from a written contract is barred if the following three elements are satisfied: (1) the contract relates to a transaction, a project, or a set of transactions related to the same project involving total consideration by the consumer of more than $100,000; (2) in negotiating the contract the consumer is represented by legal counsel who is not directly or indirectly identified, suggested, or selected by the defendant or an agent of the defendant; and (3) the contract does not involve the consumer's residence. 8 All three elements exist in this case. First, the consideration at issue is in excess of $500,000, which exceeds the $100,000 threshold requirement for exemption under this section. Secondly, the Lease Agreement itself conclusively establishes that KRE was represented by legal counsel, as the contract signed by KRE’s representative states so. See Exb. 1, provision 22.20 [Notwithstanding the fact that this Lease (in its original form) was prepared by Landlord, this Lese has been reviewed by Tenant and its legal counsel_and the terms and provisions hereof have been negotiated by both parties....] (emphasis added). In Arnold & Co., LLC v. David K. Young Consulting, LLC, the court found that the section 17.49(f) exemption was met when the parties stipulated in their contract that they had “engaged and consulted” with legal counsel. No. SA:13-CV-146-DAE, 2015 WL 268520, at *5 (W.D. Tex. Jan. 21, 2015) (not reported in F. Supp. 3d). We know this to be true, as the Lease proposed by Landlord LJP was amended pursuant to negotiated terms requested by Tenant. See Exb. 1, provision 24.1. 9. Accordingly, for these additional reasons, Plaintiff KRE’s DTPA claims are exempted from the DTPA and fail as a matter of law. The Court should grant LJP’s MSJ and dismiss all of KRE’s DTPA claims. Wherefore, Defendant LJ Parkway respectfully requests that the Court grant its Traditional Motion for Summary Judgment or Partial Summary Judgment based on limitations and contractual disclaimer and non-liability provisions, and that the Court grant LJ Parkway such other and further relief, at law or in equity, to which LJ Parkway may be justly entitled and this Court deems proper. Respectfully submitted, KRENEK LAW OFFICES, PLLC By: /s/ EddieM. Krenek Eddie M. Krenek Texas Bar No. 11724980 Email: edkrenek@kreneklaw.com Tricia K. Krenek Texas Bar No. 24031324 Email: tkthompson@kreneklaw.com 21555 Provincial Blvd. Katy, Texas 77450 Telephone (281) 578-7711 Facsimile (281) 578-8988 Attorneys for LJ Parkway, LLC CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing was served on all counsel of record in compliance with the Texas Rules of Civil Procedure on the 12" day of April 2023, as follows: Mr. Kevin Pennell Served via Electronic Service Provider and/or Pennell Law Firm PLLC via email: kevin@pennellfirm.com 19 Briar Hollow Ln., Suite 110 Houston, TX 77027 Phone: (713) 965-7568 Fax: (713) 583-9455 Counsel for Kennedy Roofing & Exteriors, Inc. And Nicholas Kennedy Mr. Pascal Paul Piazza Served via Electronic Service Provider and/or ZUKOWSKI, BRESENHAN & PIAZZA, LLP via email: ppp@zbplaw.com 1177 West Loop South, Suite 950 Houston, Texas 77027 Phone: (713) 965-9969 Fax: (713) 963-9169 Counsel for Kennedy Roofing & Exteriors, Inc. Mr. Andrew K. Meade Served via Electronic Service Provider and/or MEADE NEESE & BARR LLP via email: ameade@mnblip.com 2118 Smith Street Houston, Texas 77002 Phone: (713) 355-1200 Counsel for Jack Beaumont Evans and IRLP, LLC By: /s/ Eddie M. Krenek Eddie M. Krenek Exhibit 1 ( LEASE AGREEMENT ARTICLE I. BASIC LEASE PROVISIONS AND LIST OF EXHIBITS, AK 11 Basic Lease Provisions. (a) DATE OF THIS LEASE: January 10, 2018 (b) LANDLORD NAME: LJ Parkway, LLC © ADDRESS OF LANDLORD FOR NOTICES: 15010 Lakefair Dr. Richmond, TX 77406 @) TENANT NAME: _Kennedy Roofing & Exteriors © ADDRESS OF TENANT FOR NOTICES: , or the Leased Premises (f) TENANT'S TRADE NAME: Kennedy Roofing & Exterior: 8, PREMISES: An area of approximately 2. 600 square feet of Floor Area known as Suite __20__ located at 4820 LJ Parkway, Sugar Land, Texas 77479 (the “Premises”) within the Shopping Center (the “Center”), located as shown on Exhibit "A-1" hereto. The Center is located on a tract of land described in Exhibit "A." The land, and the buildings and other improvements thereon are sometimes referred to herein as the “Project.” (h) LEASE TERM: This Lease shall become effective upon execution hereof by Landlord {notwithstanding the date indicated in Article 1.1(a) above]. The Commencement Date (“Commencement Date”) is defined as 270 days after tender of possession of the Leased Premises to Tenant, The Termination Date (“Termination Date”) is defined as last day of the 60" full calendar month after the commencement. i) MINIMUM RENT: Commencing on the Commencement Date, Minimum Rent shall be the following sums (due and payable as provided in Article III of this Lease): Lease Months Monthly Rent 1-60 $6,500.00 @ TENANT'S PROPORTIONATE SHARE: 9.29%, (k) COMMON AREA FEE: $1,742.00 (See Article 4.5) ® SECURITY DEPOSIT: $6,500.00 Inet Tenant__ WH Page 1 of 47 KENO39 ' Exhibit (m) PREPAID RENT (T~ BE APPLIED TO THE FIRST MONTiss RENT AND CAM): $8,242.00 (n) CONSTRUCTION ALLOWANCE: $30.00 per square foot. (0) PERMITTED USE: The Premises shall be used only for the following: Operation of a roofing and exteriors business office and for no other purpose (See Article V). () INITIAL ESTIMATED MONTHLY OPERATING EXPENSE PAYMENTS: (estimates only and subject to adjustment to actual costs and expenses according to the remaining provisions of this Lease): 1. Common Area Charges $.15 PSF 2. Taxes: $.42 PSF 3. Insurance: $.10 PSF Total $.67 PSF (s) BROKER(S): Landlord will pay leasing commissions based on listing agreement. JBLK Texas Land & Leases serving as the Landlord representative and Stephen Montoya of MontLargo Properties representing the Tenant. ® Definitions of certain words, terms or provisions in this Lease are set out in Article XXIII below, PHIS LEASE IS SUBJECT TO ARBITRATION AS PROVIDED IN PARAGRAPH 22.16. 12 List of Exhibits, The Exhibits and/or Addenda listed below as being part of this Lease are attached to and are to be construed as part of, and covenants under, this Lease. C "A" Legal Description "A-1" Site Plan "B" Rules and Regulations "C-1" Construction Rider "D" Sign Specifications O "E" Guaranty 13 Landlord's Work. (See Exhibit C-1, paragraph A) ARTICLE II. LEASED PREMISES; TERM; CONSTRUCTION. 21 Landlord hereby leases and demises to Tenant and Tenant hereby accepts from Landlord on the terms set forth herein, the Premises together with all appurtenances specifically granted in this Lease. Landlord, without limiting its rights hereunder, (a) retains and excludes from this demise (i) the exterior faces of the walls of the Premises (except as otherwise expressly set out in this Lease), (ii) the roof and, as applicable, the area, if any, between the ceiling or drop ceiling and the floor or roof above and (iii) the land under the Premises, and (b) reserves unto itself the right to install, connect, maintain, use, repair, remove, and replace the Utility Facilities ‘ocated in the Premises, in locations which will not materially interfere with Tenant's use of the Premises, and the right to enter into the Premises in connection therewith. 2.2 Tenant shall have and hold the Premises for the Lease Term set forth in Section 1.1(i), unless sooner terminated as hereinafter provided. Initiat taney ~ Initial Tenant NY Page 2 of A7 KEN040 ? Exhibit 1 2.3 Landlord shall perform Landlord’s Work (as set out in paragray.c A of Exhibit “C-1”), and Tenant shall with due diligence cause to be performed the Tenant's Work, pursuant to the plans and specifications therefor subject to approval in writing by Landlord, and install in the Premises its trade fixtures, furniture and equipment (as provided for on Exhibit "C"-1 Tenant’s Work); Tenant shall open the Premises to the public for business not later than 180 days after the Premises is delivered by Landlord to Tenant. ARTICLE III. RENT AND SECURITY DEPOSIT. ot 31 The Rent specified in Section 3.2 shall accrue hereunder from the Commencement Date. 3.2 Tenant promises and agrees to pay to Landlord by mail or in person at the address of Landlord as set forth in Section 1.1(c), or such other place as Landlord may from time to time designate in writing, the following Rent: (a) Minimum Rent as set forth in Section 1.1(j); (b) The Common Area Maintenance Fee as set forth in Section 4.5; and ©) All other sums and charges due by Tenant to Landlord under the terms of this Lease. All such sums (and other charges or payments provided to be paid to Landlord herein) are sometimes referred to herein as “Rent.” 3.3 Except as otherwise expressly provided herein, all Rent shall be due and payable monthly, in advance, beginning on the Commencement Date, without demand, notice, deduction or setoff, and continuing hereafter, on the first day of each month during the Lease Term. In the event any installment of Rent is not received within five days after the date on which such amount is due, Tenant shall pay as additional rent, and as a late chargeten percent (10%) of the amount past due, plus the amount of any attorneys’ fees reasonably incurred by Landlord in connection therewith for each such late payment. Tenant shall also pay an administrative charge of $50.00 for each check returned unpaid for any reason. If Tenant is late in making payments due hereunder (including, but not limited to, Minimum Rent), Landlord may at any time thereafter, upon written notice to Tenant, require that (until further notice) all payments of Rent be made by certified or cashier's check, The first month's Rent and other charges or fees shall be prorated from the Commencement Date through and including the last day of the month in which the Commencement Date occurs and shall be paid in advance on the Commencement Date. Contemporaneously with the execution of this Lease by Tenant, Tenant shall pay to Landlord the Prepaid Rent (in the amount set forth in Section 1.1(n)) which shall be applied to the Rent and CAM for the first full month of the Term. 3.4 Tenant shall, contemporaneously with the execution of this Lease, deposit with Landlord the Security Deposit. If Tenant shall fail to pay any installment of Rent when due, said Security Deposit may, at the option of Landlord, be applied to any such sums due and unpaid, and if Tenant violates any of the other terms, covenants and conditions of this Lease, said Security Deposit may be applied to any damages suffered as a result of Tenant's default to the extent of the amount of the damages suffered. Should any of the Security Deposit be used to pay sums due for any reason, and if this Lease is kept in full force and effect at the option of Landlord, Tenant shall reimburse Landlord the amount of such depletion, within 10 days after notice to Tenant by Landlord of such depletion. Should Tenant comply with all of the terms, covenants and conditions of this Lease, and promptly pay all of the Rent herein provided as it falls due, the Security Deposit shall be returned to Tenant in full (but without interest) within 60 days after Tenant requests in writing the return of the Security Deposit, which ‘equest shall include the forwarding address of Tenant and the warranty and representation of Tenant (and the officer, partner or agent signing on behalf of Tenant) that Tenant has fulfilled all of its obligations hereunder. Landlord may deliver the Security Deposit to the assignee of Landlord's interest in the Premises in the event that such interest be sold or assigned, and thereupon Landlord shall be discharged from further liability with respect to such Security Deposit. Initial tendon 54 intial Tenant__ NL Page 3 of 47 KENO41 ° Exhibit 1 ARTICLE IV. COMMON AnfA 41 Common Area: All portions of the Center which Landlord may from time to time make available (or designate) for the general, non-exclusive use, and benefit of Tenant, other tenants and their Permitees. The Common Areas shall include without limitation the following, to the extent same are made available to serve more than one occupant: parking areas, traffic lanes, traffic control facilities, entrances and exits from and to public streets, sidewalks, landscaping, lighting facilities, Utility Facilities, fire corridors, restrooms, truck ramps, loading facilities and docks, as the same may exist from time to time. 4.2 Common Area Expense: Landlord's actual costs of owning, operating, maintaining and repairing the Common Areas with respect to periods within the Lease Term, including but not limited to, all costs with respect to such periods incurred by Landlord with respect to the following: security services, if any, (except that Landlord shall not be required to provide any security services at any time); lighting, cleaning, removing debris from, maintaining, restriping and repairing the parking areas; providing signs or personnel for traffic control; providing and maintaining landscaping in the Common Area; maintaining, repairing and lighting traffic islands, loading and service areas, service drives, and drainage facilities; cleaning, maintaining, repainting and repairing exterior walls of buildings within the Center; maintaining and repairing Utility Facilities; maintaining, repairing and replacing roofs; any fees, dues or other charges required to be paid to any person, association or entity pursuant to the terms of any covenants, conditions or restrictions of record affecting the Center; maintenance, repair, inspection and depreciation (solely in Landlord's discretion) of all machinery and equipment used in the operation or maintenance of the Common Area; Insurance Charges and Tax Charges; the cost of any item used in connection with the operation, maintenance or repair of the Common Area, provided that if any such item costs more than $10,000.00 and is, in Landlord's reasonable judgment, properly considered a capital item, the cost of such item (including financing costs) shall be spread over the life of such item (as reasonably determined by Landlord) and only the portion of such cost which pertains to the period in question shall be ncluded in the Common Area Expenses for such period; and wages and salaries of all personnel engaged in the operation, reasonable management fees, maintenance, traffic control or access control of the Center, including taxes, insurance, and benefits relating thereto (provided, however, that if during the Lease Term such personnel or entities are working on projects being periodically developed or operated by Landlord as well as the Center, their wages, salaries, fees, and related expenses, shall be appropriately allocated by Landlord among all of such projects and only that portion of such expenses reasonably allocable to the Center shall be included in the calculation of the Common Area Maintenance Fee); plus an amount equal to 15% of all of the foregoing costs (excluding salaries and expenses of such property managers for purposes of such calculation only) to cover Landlord's administrative costs. Common Area Expenses shall not increase by more than 7% per year, excluding Taxes and Insurance costs 4.3 Landlord shall operate and maintain the Common Area in such manner as Landlord in its sole discretion determines to be in the best interests of the Center. Landlord reserves the right at its sole discretion to change from time to time the size, dimensions and location of the Common Area as shown on Exhibit "A-1," including without limitation, the entrances, exits, lanes, size, boundaries and location of the parking areas; and the size, dimensions, identity and type of any building(s) shown on Exhibit "A-1"; and has the further right to construct any structure, or improvements, temporary or permanent, on any part of the Common Area without the consent of the Tenant subject to no restriction except that without the prior consent of Tenant (subject to the provisions of Articles XIII and XIV hereof), there shall be no material reduction of the size and dimension of, or access to the Premises. So long as Tenant is not in default hereunder, Tenant and its Permitees shall have the nonexclusive license to use the Common Area as constituted from time to time in common with Landlord, other tenants of the Center and other persons entitled to use the same, which license shall be subject to reasonable rules and regulations as Landlord may from time to time prescribe. Tenant shall not solicit any business within the “ommon Area or take any action which would interfere with the rights of other persons to use the Common Area. 4.4 The use of the Common Area by employees of Tenant may be restricted by Landlord from time to time. Landlord shall have the right to maintain and operate lighting facilities on all the parking areas and to control all the parking and other Common Area, and to make reasonable rules regulating the use, thereof, Initial tande 6 2, Initial Tenant NK Page 4 of A7 KEW042 * Exhibit 1 fs including, without limitation, the rir“ ° to designate and regulate employee Pi -“ing areas, and to do and perform such other reasonable acts with respect to the Common Area as in the ju went of Landlord and Landlord's counsel may be legally necessary, including temporarily closing any part of the Common Area to prevent a iedication thereof to the public or to prevent the public from obtaining prescriptive rights. Without limitation of the foregoing, Landlord expressly reserves the right to require that Tenant and other tenants in the Shopping Center cause their employees to park only in areas specifically designated by Landlord. 45 Tenant’s “Common Area Maintenance Fee” (sometimes herein referred to as “CAM”) for the period commencing on the Commencement Date, and ending on the Termination Date.During December of each calendar year or as soon as possible thereafter as practicable, Landlord will give Tenant written notice of its estimated of CAM rent payable for the ensuing calendar year. On or before the first of each month during the ensuing calendar year, Tenant will pay to Landlord 1/12" of such estimated amounts, provided that if such notice is not given in December, Tenant will continue to pay on the basis of the prior’s estimate until the month after notice is given. Within one hundred twenty (120) days after the end of each year during the Lease Term, Landlord shall compute and determine the actual Common Area Expenses for the relevant prior calendar year. Landlord shall give Tenant notice of such Common Area Expenses and notice of Tenant's Common Area Maintenance Fees payable with respect to such period. If Tenant's actual Common Area Maintenance Fee with respect to such period exceeds the amount therefor previously paid by Tenant, Tenant shall pay Landlord the deficiency in each such case within 30 days following notice from Landlord; however, if the aforesaid amount previously paid by Tenant towards Tenant's actual Common Area Maintenance Fee is in excess of Tenant's actual Common Area Maintenance Fee with respect to such period, then the balance thereof shall be held by Landlord and applied to the payment of Tenant's Common Area Maintenance Fee next due; except that any amounts remaining at the termination of this Lease shall be offset against any amounts then owing by Tenant to Landlord under any of the terms of this Lease, and any remaining net surplus shall then be refunded by Landlord to Tenant. ARTICLE V. USE AND CARE OF PREMISES. Ss The Premises shall be used and occupied by Tenant only for the Permitted Use under Tenant's Trade Name, and for no other purpose or use, and under no other trade name, without the prior written consent of Landlord. Tenant acknowledges that actual and substantial detriment will result to Landlord and the other tenants of the Center in the event there is a deviation from the Permitted Use without the prior written consent of Landlord. Tenant shall not make or permit any unlawful use of the Premises, Tenant shall not at any time leave the Premises vacant, but shall in good faith continuously throughout the term of this Lease conduct and carry on in the Premises the type of business for which the Premises are leased, in accordance with the best standards of operation of such business, for at least 40 hours of every week. In the event the exterior lights for the Premises are individually controlled by Tenant from the Premises, then Tenant, at Tenant's sole cost and expense, shall keep all lights illuminating its exterior sign, if any, and all lights on the canopy in front of the Premises illuminated from dusk through 10 o'clock P.M. every day, Monday through Sunday. If Landlord controls all exterior lighting, all costs incurred by Landlord in connection therewith shall be included in the Common Area Maintenance Fee. 5.2 Tenant shall not, without Landlord's prior written consent, perform any act or fail to perform any act, keep anything within the Premises or use the Premises for any purpose that increases the insurance premium cost or invalidates any insurance policy carried on the Premises or on other parts of the Center. If Landlord does give written consent to Tenant pursuant to the above sentence, then Tenant shall be liable, at its sole cost and expense, for the amount of any increase in the insurance premium cost resulting from such act or omission to which Landlord has consented. 5.3 The term "Hazardous Substances," as used in this Lease, shall mean pollutants, contaminants, toxic or hazardous wastes, radioactive materials or any other substances, the use and/or the removal of which is required wr the use of which is restricted, prohibited or penalized by any "Environmental Law," which term shall mean any sederal, state or local statute, ordinance, regulation or other law of a governmental or quasi-governmental authority relating to pollution or protection of human health or the environment or the regulation of the storage or handling of Hazardous Substances. Tenant hereby agrees that: (i) no activity will be conducted on the Premises that will produce any Hazardous Substance; (ii) the Premises will not be ed in any manner for the storage of Initial Langa b¢ Initial Tenant Nie _ P a g e 5 Z 7 KEN043 * Exhibit 1 any Hazardous Substances; (iii) Ten * will not permit any Hazardous Substap ~s to be brought onto the Premises or the Center. If at any time during ur after the term of this Lease, any Hazarucus Substance is found located on the Premises, or on the Center resulting from the actions of Tenant, Tenant's agents, employees or contractors, or anyone for whose actions Tenant is liable, the same shall at Landlord's election either (x) be immediately removed by Tenant, with proper disposal, and all required clean-up procedures shall be diligently undertaken by Tenant at its sole cost pursuant to all Environmental Laws or (y) Landlord may remove the same, and Tenant shall, within 10 days after a demand from Landlord, reimburse Landlord for all actual costs of inspection, monitoring and/or remediation. Tenant shall make all notifications and shall obtain and maintain in full force all permits, licenses, registrations, or similar authorizations required under any Environmental Law for the operations or activities of Tenant at the Premises. Tenant agrees to indemnify and hold Landlord harmless from all claims, actions, liabilities, costs, expenses, damages, penalties and obligations of any nature arising from or as a result of any contamination of the Premises with Hazardous Substances, or any contamination of the Center resulting from the actions of Tenant, Tenant's agents, employees or contractors, or anyone for whose actions Tenant is liable, or otherwise arising from the use of the Premises by Tenant. Tenant shall store, use, handle or dispose of all permitted Hazardous Substances, necessary for use and operation of Tenant’s business, used on the Premises in the ordinary course of Tenant's business in strict compliance with all Environmental Laws. The terms of this Section 5.3 shall survive the termination or expiration of this Lease. 5.4 Tenant shall not, without Landlord's prior written consent, conduct or permit to be conducted within the Premises any fire, auction, bankruptcy, "lost-our-lease," "going-out-of-business," or similar sales; nor permit any objectionable or unpleasant odors or loud noises to emanate from the Premises; nor place or permit any radio, television or other antenna, loud speaker or amplifier, or flashing lights on the roof or outside the Premises or where the same can be seen or heard outside the building; nor place or display any signs, advertise- ments or other items (other than permitted under Section 8.1) in any windows or glass store fronts. In no event shall Tenant take any other action which would disturb or endanger other tenants of the Center, or unreasonably interfere with their use of their respective premises or create a nuisance, or omit an unreasonable odor from the Premises or create an annoyance to Landlord or to other tenants. 5:5 Tenant, at its sole cost and expense, shall obtain (and upon request deliver to Landlord) all permits and licenses and pay all fees required for the transaction of its business in the Premises, Tenant shall not violate any applicable laws, ordinances, rules, governmental regulations, or restrictive covenants now in force or which may hereafter be in force pertaining to the Premises or the operation of Tenant's business therein. Tenant acknowledges that the Center may be subject to restrictive covenants that may affect Tenant's business at the Premises, Tenant hereby waives any claims or causes of action against Landlord arising out of any violation by Tenant of any applicable restrictive covenants; and Tenant shall indemnify and hold harmless Landlord from all claims, causes of action, costs, losses, damages and attorneys' fees incurred by Landlord in connection with any such violation by Tenant, Tenant shall reimburse Landlord for Tenant’s Proportionate Share of property owners’ association dues and assessments, if any, within 30 days after a request for payment from Landlord. 5.6 Tenant shall take good care of the Premises and keep the same free from waste or nuisance at all times. Tenant shall not locate or install or cause to be located or installed on the sidewalks, service area, service corridors or other portions of the Common Area (as applicable) immediately adjoining the Premises or on the storefront any bicycle racks, newspaper holder stands, vending machines of any kind, mailboxes, telephone booths, trash or refuse receptacles, "no parking" or “reserved parking” signs or any other device of a similar nature without the prior written approval of Landlord. Tenant shall keep the Premises, including windows and signs and service ways, loading areas and other portions of the Common Area immediately adjacent to the Premises neat, clean, and free from dirt or rubbish at all times and shall store all trash within the Premises, and shall arrange for the regular pickup of such trash and garbage at Tenant's expense. In the event Tenant fails to do so, then Landlord shall have the right to cause such trash to be picked up at the sole cost and expense of Tenant. Tenant shall on iemand pay any cost and expense of picking up such trash incurred by Landlord plus 10% of such cost and expense (to cover Landlord's overhead and administrative costs with respect thereto). All trash receptacles or dumpsters installed by Tenant must comply with any statute, ordinance, rule, regulation, or restrictive covenant now or hereafter in force governing the location, use or manner of their placement or Landlord shall have the right to remove from the Center without notice any such receptacles that do ot so comply. Tenant shall also Initial tan f Initial Tenant__ Ny Page 6 ofé KENO044 ° Exhibit 1 maintain its grease traps (if any), ay “ep all pipes and drains free from obs} tion and shall be responsible for all damages or loss resulting from .enant’s failure to do so. Tenant shall vx solely responsible for any fine, penalty or damage that may result from its failure to comply with this Section. Receipt and delivery of goods and nerchandise and removal of trash shall be made only by way of the service entrance, and shall be subject to such regulations as Landlord may from time to time prescribe. Without limitation of the foregoing, Landlord shall have the right to require that Tenant share a dumpster with one or more other tenants in the Shopping Center; in such event, Landlord shall make arrangements for such dumpster to be emptied on a regular basis and Tenant shall pay to Landlord as Rent, Tenant's Proportionate Share of such dumpster charges. ARTICLE VI. MAINTENANCE AND REPAIR OF PREMISES. 6.1 Landlord shall maintain only the foundation, the structural portions of the exterior walls (except store front, windows, plate glass, doors, door closure devices, window and door frames, moldings, locks, hardware and painting and other treatment of interior walls, which shall all be maintained by Tenant) and roof of the Premises in good repair; provided, however, that Landlord shall not be required to make any repairs occasioned by the act, omission or negligence of Tenant, or its Permitees, it being expressly agreed that any loss, damage or injury arising out of, or as a result of Tenant’s acts or omissions, shall be the sole obligation of Tenant. In the event that the Premises should become in need of repairs required to be made by Landlord hereunder, Tenant shall give immediate written notice thereof to Landlord; and Landlord shall not be responsible in any way for failure to make any such repairs until a reasonable time shall have elapsed after delivery of such written notice. 6.2 Tenant shall maintain the Premises clean, and in good order and condition and shall make all needed repairs thereto (except only for repairs required to be made by Landlord under the provisions of Section 6.1 above), including, without limitation, mechanical, electrical and plumbing, HVAC, maintenance of all doors and doorways, all utility connections and replacement of cracked or broken glass. Tenant shall comply at its sole cost and expense with all governmental laws, ordinances and regulations applicable to the Premises. If any repairs ‘equired to be made by Tenant hereunder are not made within 10 days after written notice has been delivered to Tenant by Landlord, Landlord may at its option, in addition to its other remedies hereunder, make such repairs without liability to Tenant for any loss or damage which may result to Tenant's stock or business by reason of such repairs, Tenant shall pay to Landlord upon demand the actual cost of such repairs plus 10% of such cost (to cover Landlord's overhead and administrative costs with respect thereto). Without limitation of the foregoing, Tenant, at Tenant’s cost, shall have sole responsibility for maintenance and upkeep of the heating, ventilating and air conditioning system, the sprinkler system (if any), that portion of the sewer system which exclusively serves the Premises (unless damage to the Center's sewer system is caused by Tenant's use or misuse, in which event Tenant shall be responsible for the repair of all damage caused thereby). 6.3 Any Tenant Work or other alterations or modifications of the Premises causing venting, opening, sealing, waterproofing or in any way penetrating or altering of the roof ("Roof Modifications") shall be performed at Tenant's expense by Landlord’s contractor ("Roof Contractor"). In the event any such Roof Modifications are to be made, Tenant shall notify Landlord thereof, and shall furnish Landlord a reasonably detailed statement of the work to be performed on the roof, and must first receive Landlord’s written consent to Tenant’s proposed work on or through the roof. 6.4 Tenant has inspected the Premises, is familiar with its condition and accepts same in its present "AS IS" condition, including any latent defects, Tenant acknowledges that Landlord is not obligated to do any further construction or make any additional improvements to the Premises except which is set out in Exhibit C- 1 ARTICLE VII. ALTERATIONS AND FIXTURES. 21 Tenant shall not, without on each occasion obtaining Landlord's prior written consent: (a) alter or change the exterior or architectural treatment of the Premises; (b) paint or deporate any part of the exterior of the Initial tendon j74 Initial Tenant NK P a g e 7 of47 KENO45 ’ Exhibit 1 Premises; (c) make any alterations additions to the Premises or permit th aking of any holes in the walls, eilings or floors thereof or in the rouf of any of the building; (d) injure, ovet.vad, deface or otherwise harm the Premises or any part thereof; or (e) permit the use of any forklift or tow truck, or any other mechanically powered nachine or equipment for handling freight in the Premises or other portion of the Center; provided, however, that Tenant may perform Tenant's Work and install unattached, movable furniture and trade fixtures and equipment. All repairs, replacements, alterations, additions, improvements, plate glass, exterior doors, overhead sprinkler systems (if any), floor coverings and fixtures (other than unattached, movable trade fixtures) including all air conditioning, electrical, mechanical and plumbing machinery and equipment, exhaust hoods and water heaters, which may be made or installed by either party hereto upon the interior or exterior of the Premises shall become the property of Landlord without credit or compensation to Tenant at the termination of this Lease for any reason whatsoever, and at the termination of this Lease shall remain upon and be surrendered with the Premises, unless Landlord requests their removal, in which event Tenant shall, prior to such termination, remove the same and restore the Premises to their original condition, normal wear and tear excepted, at Tenant's expense. At the expiration of the Lease Term (and provided Tenant is not then in default under this Lease), all moveable trade fixtures and equipment owned by Tenant used at (and not permanently attached to) the Premises shall be promptly removed by Tenant. ARTICLE VIII. SIGNS AND STORE FRONTS. 8.1 Tenant, at Tenant’s cost, shall install a storefront sign on the fascia above the Premises, provided however Tenant shall first furnish Landlord with specifications of such sign, and Tenant must first receive Landlord’s written approval of such sign before installing the same. Tenant shall not, without Landlord's prior written consent in each instance: (a) make any changes to the store front, (b) install any exterior lighting, shades or awnings, or any exterior decorations or paintings, (c) place or install any reflective material on the doors, windows or store front, or (d)