Exhibit 10.16
COMMERCIAL LEASE AGREEMENT
This Commercial Lease Agreement ("Lease") is made and effective April 1,
2007 by and between Xxxxx Building Company LLC ("Landlord") and Ecology Coating,
Inc. ("Tenant").
WHEREAS, Landlord is the lessee pursuant to a lease between landlord as
lessee and 950 Hunter Associates, Inc., as amended of 00000 Xxxxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000 (the "Leased Premises");
WHEREAS, Landlord makes available for lease a portion of the suite
designated as office no. 1, office no. 4, office no. 5, office no. 6 and the
reception desk in common with Landlord;
WHEREAS, Landlord desires to lease the Leased Premises to Tenant, and
Tenant desires to lease the Leased Premises from Landlord for the term, at the
rental and upon the covenants, conditions and provisions herein set forth.
NOW, THEREFORE, in consideration of the mutual promises herein, contained
and other good and valuable consideration, it is agreed:
1. TERM.
A. Landlord hereby leases the Leased Premises to Tenant, and Tenant hereby
leases the same from Landlord beginning April 1, 2007 and continuing on a
month-to-month basis. Tenant shall provide Landlord with notice of its intent to
vacate no less than thirty (30) days in advance. Landlord shall provide Tenant
with notice of intent to terminate the Lease no less than thirty (30) days in
advance.
2. RENTAL.
A. Tenant shall pay to Landlord installments of 3,200 per month. Each
installment payment shall be due in advance on the first day of each calendar
month during the lease term to Landlord at 00000 Xxxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000 or at such other place designated by written
notice from Landlord or Tenant. The rental payment amount for any partial
calendar months included in the lease term shall be prorated on a daily basis.
3. USE
A. The Leased Premises shall be used for office purposes only.
Notwithstanding the forgoing, Tenant shall not use the Leased Premises for the
purposes of storing, manufacturing or selling any explosives, flammables or
other inherently dangerous substance, chemical, thing or device.
4. SUBLEASE AND ASSIGNMENT.
A. Tenant shall have the right without Landlord's consent, to assign this
Lease to a corporation with which Tenant may merge or consolidate, to any
subsidiary of Tenant, to any corporation under common control with Tenant, or to
a purchaser of substantially all of Tenant's assets. Except as set forth above,
Tenant shall not sublease all or any part of the Leased Premises, or assign this
Lease in whole or in part without Landlord's consent, such consent not to be
unreasonably withheld or delayed.
5. REPAIRS.
A. During the Lease term, Tenant shall make, at Tenant's expense, all
necessary repairs to the Leased Premises. Repairs shall include such items as
routine repairs of floors, walls, ceilings, and other parts of the Leased
Premises damaged or worn through normal occupancy, except for major mechanical
systems or the roof, subject to the obligations of the parties otherwise set
forth in this Lease.
6. ALTERATIONS AND IMPROVEMENTS.
A. Tenant, at Tenant's expense, shall have the right following Landlord's
consent to remodel, redecorate, and make additions, improvements and
replacements of and to all or any part of the Leased Premises from time to time
as Tenant may deem desirable, provided the same are made in a workmanlike manner
and utilizing good quality materials. Tenant shall not, however, enact
structural changes to the Leased Premises or add moving walls. Tenant shall have
the right to place and install personal property, trade fixtures, equipment and
other temporary installations in and upon the Leased Premises, and fasten the
same to the premises. All personal property, equipment, machinery, trade
fixtures and temporary installations, whether acquired by Tenant at the
commencement of the Lease term or placed or installed on the Leased Premises by
Tenant thereafter, shall remain Tenant's property free and clear of any claim by
Landlord. Tenant shall have the right to remove the same at any time during the
term of this Lease provided that all damage to the Leased Premises caused by
such removal shall be repaired by Tenant at Tenant's expense.
7. PROPERTY TAXES.
A. Landlord shall pay, prior to delinquency, all general real estate taxes
and installments of special assessments coming due during the Lease term on the
Leased Premises, and all personal property taxes with respect to Landlord's
personal property, if any, on the Leased Premises. Tenant shall be responsible
for paying all personal property taxes with respect to Tenant's personal
property at the Leased Premises.
8. INSURANCE.
A. If the Leased Premises or any other part of the Building is damaged by
fire or other casualty resulting from any act or negligence of Tenant or any of
Tenant's
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agents, employees or invitees, rent shall not be diminished or abated while such
damages are under repair, and Tenant shall be responsible for the costs of
repair not covered by insurance.
B. Landlord shall maintain, or cause to be maintained, fire and extended
coverage insurance on the Building and the Leased Premises in such amounts as
Landlord shall deem appropriate. Tenant shall be responsible, at its expense,
for fire and extended coverage insurance on all of its personal property,
including removable trade fixtures, located in the Leased Premises.
C. Tenant and Landlord, or Landlord's landlord, shall, each at its own
expense, maintain a policy or policies of comprehensive general liability
insurance with respect to the respective activities of each in the Building with
the premiums thereon fully paid on or before due date, issued by and binding
upon some insurance company approved by Landlord, such insurance to afford
minimum protection of not less than $1,000,000 combined single limit coverage of
bodily injury, property damage or combination thereof. Landlord shall be listed
as an additional insured on Tenant's policy or policies of comprehensive general
liability insurance, and Tenant shall provide Landlord with current Certificates
of Insurance evidencing Tenant's compliance with this Paragraph. Tenant shall
obtain the agreement of Tenant's insurers to notify Landlord that a policy is
due to expire at least (10) days prior to such expiration. Landlord shall not be
required to maintain insurance against thefts within the Leased Premises or the
Building.
9. UTILITIES.
A. Tenant shall pay all charges for water, sewer, gas, electricity,
telephone and other services and utilities used by Tenant on the Leased Premises
during the term of this Lease unless otherwise expressly agreed in writing by
Landlord. In the event that any utility or service provided to the Leased
Premises is not separately metered, Landlord shall pay the amount due and
separately invoice Tenant for Tenant's pro rata share of the charges. Tenant
shall pay such amounts within fifteen (15) days of invoice. Tenant acknowledges
that the Leased Premises are designed to provide standard office use electrical
facilities and standard office lighting. Tenant shall not use any equipment or
devices that utilizes excessive electrical energy or which may, in Landlord's
reasonable opinion, overload the wiring or interfere with electrical services to
other tenants.
10. SIGNS.
A. Following Landlord's consent, Tenant shall have the right to place on
the Leased Premises, at locations selected by Tenant, any signs which are
permitted by applicable zoning ordinances and private restrictions. Landlord may
refuse consent to any proposed signage that is in Landlord's opinion too large,
deceptive, unattractive or otherwise inconsistent with or inappropriate to the
Leased Premises or use of any other tenant. Landlord shall assist and cooperate
with Tenant in obtaining any necessary permission from governmental authorities
or adjoining owners and occupants for Tenant to place or construct the foregoing
signs. Tenant shall repair all damage to the Leased
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Premises resulting from the removal of signs installed by Tenant. All signage
shall be subject to the approval of Landlord's landlord.
11. ENTRY.
A. Landlord shall have the right to enter upon the Leased Premises at
reasonable hours to inspect the same, provided Landlord shall not thereby
unreasonably interfere with Tenant's business on the Leased Premises.
12. PARKING.
A. During the term of this Lease, Tenant shall have the non-exclusive use
in common with Landlord, other tenants of the Building, their guests and
invitees, of the non-reserved common automobile parking areas, driveways, and
footways, subject to rules and regulations for the use thereof as prescribed
from time to time by Landlord's landlord. Landlord reserves the right to
designate parking areas within the Building or in reasonable proximity thereto,
for Tenant and Tenant's agents and employees. Tenant shall provide Landlord with
a list of all license numbers for the cars owned by Tenant, its agents and
employees.
13. BUILDING RULES.
A. Tenant will comply with the rules of the Building adopted and altered by
Landlord's landlord from time to time and will cause all of its agents,
employees, invitees and visitors to do so; all changes to such rules will be
sent by Landlord to Tenant in writing.
14. DAMAGE AND DESTRUCTION.
A. Subject to Section 8 A. above, if the Leased Premises or any part
thereof or any appurtenance thereto is so damaged by fire, casualty or
structural defects that the same cannot be used for Tenant's purposes, then
Tenant or Landlord shall have the right within thirty (30) days following damage
to elect by written notice to Landlord's landlord to terminate this Lease as of
the date of such damage. Tenant shall be relieved from paying rent and other
charges during any portion of the Lease term that the Leased Premises are
inoperable or unfit for occupancy, or use, in whole or in part, for Tenant's
purposes. Rentals and other charges paid in advance for any such periods shall
be credited on the next ensuing payments, if any, but if no further payments are
to be made, any such advance payments shall be refunded to Tenant. The
provisions of this paragraph extend not only to the matters aforesaid, but also
to any occurrence which is beyond Tenant's reasonable control and which renders
the Leased Premises, or any appurtenance thereto, inoperable or unfit for
occupancy or use, in whole or in part, for Tenant's purposes.
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15. DEFAULT.
A. If default shall at any time be made by Tenant in the payment of rent
when due to Landlord as herein provided, and if said default shall continue for
five (5) days after written notice thereof shall have been given to Tenant by
Landlord, or if default shall be made in any of the other covenants or
conditions to be kept, observed and performed by Tenant, and such default shall
continue for fifteen (15) days after notice thereof in writing to Tenant by
Landlord without correction thereof then having been commenced and thereafter
diligently prosecuted, Landlord may declare the term of this Lease ended and
terminated by giving Tenant written notice of such intention, and if possession
of the Leased Premises is not surrendered, Landlord may reenter said premises.
Landlord shall have, in addition to the remedy above provided, any other right
or remedy available to Landlord on account of any Tenant default, either in law
or equity. Landlord shall use reasonable efforts to mitigate its damages.
16. QUIET POSSESSION.
A. Landlord covenants and warrants that upon performance by Tenant of its
obligations hereunder, Landlord will keep and maintain Tenant in exclusive,
quiet, peaceable and undisturbed and uninterrupted possession of the Leased
Premises during the term of this Lease.
17. CONDEMNATION.
A. If any legally, constituted authority condemns the Building or such part
thereof which shall make the Leased Premises unsuitable for leasing, this Lease
shall cease when the public authority takes possession, and Landlord and Tenant
shall account for rental as of that date. Such termination shall be without
prejudice to the rights of either party to recover compensation from the
condemning authority for any loss or damage caused by the condemnation. Neither
party shall have any rights in or to any award made to the other by the
condemning authority.
18. SUBORDINATION.
A. Tenant accepts this Lease subject and subordinate to any mortgage, deed
of trust or other lien presently existing or hereafter arising upon the Leased
Premises, or upon the Building and to any renewals, refinancing and extensions
thereof, but Tenant agrees that any such mortgagee shall have the right at any
time to subordinate such mortgage, deed of trust or other lien to this Lease on
such terms and subject to such conditions as such mortgagee may deem appropriate
in its discretion. Landlord is hereby irrevocably vested with full power and
authority to subordinate this Lease to any mortgage, deed of trust or other lien
now existing or hereafter placed upon the Leased Premises of the Building, and
Tenant agrees upon demand to execute such further instruments subordinating this
Lease or attorning to the holder of any such liens as Landlord may request. In
the event that Tenant should fail to execute any instrument of subordination
herein require d to be executed by Tenant promptly as requested, Tenant
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hereby irrevocably constitutes Landlord as its attorney-in-fact to execute such
instrument in Tenant's name, place and stead, it being agreed that such power is
one coupled with an interest. Tenant agrees that it will from time to time upon
request by Landlord execute and deliver to such persons as Landlord shall
request a statement in recordable form certifying that this Lease is unmodified
and in full force and effect (or if there have been modifications, that the same
is in full force and effect as so modified), stating the dates to which rent and
other charges payable under this Lease have been paid, stating that Landlord is
not in default hereunder (or if Tenant alleges a default stating the nature of
such alleged default) and further stating such other matters as Landlord shall
reasonably require.
19. SECURITY DEPOSIT.
A. The Security Deposit shall be held by Landlord without liability for
interest and as security for the performance by Tenant of Tenant's covenants and
obligations under this Lease, it being expressly understood that the Security
Deposit shall not be considered an advance payment of rental or a measure of
Landlord's damages in case of default by Tenant. Unless otherwise provided by
mandatory non-waivable law or regulation, Landlord may commingle the Security
Deposit with Landlord' s other funds. Landlord may, from time to time, without
prejudice to any other remedy, use the Security Deposit to the extent necessary
to make good any arrearages of rent or to satisfy any other covenant or
obligation of Tenant hereunder. Following any such application of the Security
Deposit, Tenant shall pay to Landlord on demand the amount so applied in order
to restore the Security Deposit to its original amount. If Tenant is not in
default at the termination of this Lease, the balance of the Security Deposit
remaining after any such application shall be returned by Landlord to Tenant. If
Landlord transfers its interest in the Premises during the term of this Lease,
Landlord may assign the Security Deposit to the transferee and thereafter shall
have no further liability for the return of such Security Deposit.
20. NOTICE.
A. Any notice required or permitted under this Lease shall be deemed
sufficiently given or served if sent by United States certified mail, return
receipt requested or hand delivered by courier. Notices delivered via certified
mail shall be deemed received three (3) business days after deposit with the
United States Postal Service. Noticed delivered via courier shall be deemed
received the next business day. All notices should be addressed as follows:
If to Landlord to:
Xxxxx Building Company
00000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000
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If to Tenant to:
Xxxx Xxxxx
000 Xxxxx Xxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Landlord and Tenant shall each have the right from time to time to change the
place notice is to be given under this paragraph by written notice thereof to
the other party.
21. BROKERS.
A. Tenant represents that Tenant was not shown the Premises by any real
estate broker or agent and that Tenant has not otherwise engaged in, any
activity which could form the basis for a claim for real estate commission,
brokerage fee, finder's fee or other similar charge, in connection with this
Lease.
22. WAIVER.
A. No waiver of any default of Landlord or Tenant hereunder shall be
implied from any omission to take any action on account of such default if such
default persists or is repeated, and no express waiver shall affect any default
other than the default specified in the express waiver and that only for the
time and to the extent therein stated. One or more waivers by Landlord or Tenant
shall not be construed as a waiver of a subsequent breach of the same covenant,
term or condition.
23. HEADINGS.
A. The headings used in this Lease are for convenience of the parties only
and shall not be considered in interpreting the meaning of any provision of this
Lease.
24. SUCCESSORS.
A. The provisions of this Lease shall extend to and be binding upon
Landlord and Tenant and their respective legal representatives, successors and
assigns.
25. CONSENT.
A. Landlord shall not unreasonably withhold or delay its consent with
respect to any matter for which Landlord's consent is required or desirable
under this Lease.
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27. HEAD LEASE.
A. Anything contained in this lease to the contrary notwithstanding, Tenant
hereby acknowledges that Landlord is the lessee under the Head Lease and that
this Lease is subject to all of the terms and conditions of the Head Lease, and,
further, upon the termination of the Head Lease for any reason whatsoever, this
Lease shall be of no further force and effect as between Landlord and Tenant.
Tenant agrees to be bound by all of the terms and conditions of the Head Lease,
including all rules and regulations promulgated thereunder. In the event of any
conflict between the terms and provisions of this Lease and the terms and
provisions of the Head Lease, the terms and provisions of the Head Lease shall
govern and control
28. COMPLIANCE WITH LAW.
A. Tenant shall comply with all laws, orders, ordinances and other public
requirements now or hereafter pertaining to Tenant's use of the Leased Premises.
Landlord shall comply with all laws, orders, ordinances and other public
requirements now or hereafter affecting the Leased Premises.
29. FINAL AGREEMENT.
A. This Agreement terminates and supersedes all prior understandings or
agreements on the subject matter hereof. This Agreement may be modified only by
a further writing that is duly executed by both parties.
30. GOVERNING LAW.
A. This Agreement shall be governed, construed and interpreted by, through
and under the Laws of the State of Michigan.
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IN WITNESS WHEREOF, the parties have executed this Lease as of the day and
year first above written.
/s/
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LANDLORD
/s/
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TENANT
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