Exhibit 10.1

 

 

Lease Contract (Translation)

 

Between

 

Svend Møller Hansen Ejendomme ApS

Skivevej 61

9500 Hobro

Reg.no. 32 32 40 61

(the Lessor)

 

and

 

Liqtech Systems A/S

Benshøj Industrivej 24

9500 Hobro

Reg.no. 32 56 23 02

(the Lessee)

 

 

1.

Location of the leased premises

 

 

1.1.

The lease includes commercial premises and the lease of outside land located at
Benshøj Industrivej 24, Sdr. Onsild, DK-9500 Hobro, mat.no. 12-n, Sdr. Onsild,
totalling 14,112 squaremeters (sqm.).

          The lease includes both previously rented premises and newly
constructed premises/extension.

 

2.

The interior design and size of the leased premises

 

 

2.1.

The lessee is familiar with part of the lease, as the lessee has used the lease
as a lessee since September 1, 2015.

          In addition, a new building of 2,152 sqm. furnished according to
instructions from the lessee is included in the lease contract.           The
said areas in section 2.2 comprises the total lease.

 

 

2.2.

The extension and alteration of the existing building's layout and accommodation
is described in the document "Building description" dated April 26, 2019. The
document is attached as Annex 1.

 

Excisting building     1,800 sqm.   Extension     2,152 sqm.   Separate
warehouse     300 sqm.   Total     4,252 sqm.  

 

 

 

The layout of the buildings is shown in the drawing for project no. 181201
(attached as annex 2). The layout for the separate warehouse is attached as
annex 3 in a separate drawing.

          The lessor refurbishes the bathroom and kitchen for DKK 143,000, and
the amount is included in the calculation of the rent expense.           The
lessor renovates gates in the existing building by separate agreement, and the
lessee pays for this separately with DKK 83,000.           In the separate
warehouse, lessee pays DKK 49,500 separately for floors to be changed to
concrete instead of asphalt.

 

 

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3.

Use of the leased premises

 

 

3.1.

The leased premises must be used by the lessee for production, workshop,
warehouse, administration and thus related business and may not be used without
the lessor's prior written consent to any other purpose.

 

 

3.2.

The lessor is responsible that the leased premises can be used for the specified
business listed in clause. 3.1.

          The lessee is responsible for the actual use of the rented property in
accordance with legislation, other public statutes or regulations, and the
easements registered on the property.

 

 

3.3.

The use of the leased premises must not cause any nuisance by smell, noise,
vibration or the like for the neighbors of the property.

 

 

3.4.

During the lease period, the lessee must handle the leased premises properly.
Lessee is required to replace any damage caused by neglect to the leased
premises or to the building, to the lessor’s staff or other persons that the
lessee has granted access to the property or the leased premises. The lessee is
responsible for damages caused to the property in connection with the lessee's
business, even though the lessee may not have acted irresponsibly.

 

4.

Commencement and termination of the lease

 

 

4.1.

The prior lease began on December 1, 2018 and it is expected that the extension
will be ready for use in November 2019, after which the total lease will
continue until it is terminated by one of the parties with 6 months written
notice at the end of the month. The lease contract is non-terminable by the
lessee for 15 years from start of the usage of the extension, expected from
December 1, 2019 until the end of December 2034, and from the lessor’s side
non-terminable for 15 years until the end of December 2034.

 

 

4.2.

When termination is made or if the lessee must be vacated the leased premises
for any other reason, the lessee is required to give access to the leased
premises on weekdays between 08:00AM and 06:00PM. The same applies if the
property or lease is intended to be sold.

 

 

4.3.

The lessor must notify the lessee of the time for inspection and/or presentation
in accordance with this 4.2 at the latest on the day before this is due. The
lessee is obliged to provide an address no later than 8 days before moving out
to which notices under this provision can be forwarded.

 

 

4.4.

The lessee agrees that the lease is not covered by section 62 of the Commercial
Rent Act, and that the lessee in no case may claim damages or reimbursement
under sections 66 and 67 of the Commercial Rent Act.

 

5.

Taking possession of and surrendering the leased premises

 

 

5.1.

The leased premises are taken over in good and well-maintained condition as
inspected and approved by the lessee without defects of any kind and with all
installations in good and usable condition, as lessee have used the lease since
September 1, 2015, as a sub lessee. Restoration has been done in agreement
between the lessor and the lessee.

          The extension is being taken over in a newly erected condition.

 

 

5.2.

At the end of the lease, the leased premises must be handed in neatly and
cleanly and in the same condition as at the start of the lease period, i.e. in
good and well-maintained condition without any defects of any kind and with all
installations in good and usable condition. Normal wear and tear are accepted by
the lessor.

 

 

5.3.

If the leased premises are not delivered in the agreed position at 12:00AM on
the day of departure, the lessee is obliged to pay rent and other benefits under
this contract during the renovation period, until the lease is brought in the
agreed condition.

 

 

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5.4.

Restoration work performed by the lessee's initiative may only be carried out by
VAT-registered, trained and skilled craftsmen. If the lease is not put in the
agreed condition at 12:00AM on the day of departure, the necessary measures are
taken to bring the leased premises in agreed condition at the lessor's request
at the lessee's expense.

 

6.

Lessors changes and alterations to the leased premises

 

 

6.1.

The lessor has the right to make minor changes to the leased premises and
changes to the property in accordance with the conditions in force at the time
of the entering of this contract based on the rules in the law on the lease of
commercial premises etc., by prior agreement with the lessee.

 

 

6.2.

Furthermore, the lessor is obliged to carry out such alterations and extensions
of the building as conditional upon the development of the lessee's business by
agreement with the lessee and against an agreed increase in the rent in advance
according to an approved project by one or both parties.

 

7.

Lessors right to make changes to the leased premises

 

 

7.1.

Lessee has the right to make structural changes to the leased premises,
including redevelopments and installations in accordance with those rules in
force in the Act on the lease of commercial premises at the time of signing this
contract.

 

 

7.2.

Changes of the building’s character must in all cases meet the requirements of
the authorities. It is the lessee's responsibility to obtain all necessary
permits and to fulfill any authority requirements. Lessee is obliged to keep the
lessor informed immediately and on an ongoing basis of the course of the
administrative process and submit a copy of the application, permit, etc.

 

8.

Amount of the rent and adjustment

 

 

8.1.

The annual rent is agreed at DKK 2,073,300.00 excl. VAT and is paid quarterly in
advance with DKK 518,325.00. First quarterly rent is paid when commissioning of
the extension and completion of the warehouse which is expected January 1, 2020.
The initial rental charge will be proportional to the quarterly change.

          From December 1, 2018 until commissioning of the extension, expected
December 1, 2019, a monthly rent is payable in advance with DKK 62,750.00.
Thereafter, rent is paid in advance until commissioning of the warehouse with
DKK 165,275.00.           Lessee pays separately for agreed improvements in the
existing building and the floor in the warehouse, which is defined in clause
2.2.

 

 

8.2.

Once a year on January 1st, the first time on January 1st, 2021, the rental
amount ruling as per December 31 the year before is adjusted in accordance with
the increase in the net price index. The adjustment is calculated in accordance
with the increase in the said index for October 2 years before to the index for
October year before.

 

 

8.3.

The increased annual rent is calculated according to the following principle:
Annual rent per December 31, 2020 x Net price index October 2020 / Net price
index October 2019 = Annual rent per January 1, 2021

 

 

8.4.

If the index adjustment is made impossible either by annulment of the
calculation based on the index number or other related legislation, the rent is
increased instead in accordance with the increase in another existing or new
equivalent index. If none exists, rent adjustment is calculated according to
existing principles based as closely as possible.

 

 

8.5.

Notwithstanding the above-mentioned rent regulation, both parties are also
entitled to demand recalculation of the rent in force at any time in accordance
with that applicable law at the time of the creation of this contract, including
the law on leasing of commercial premises etc., Section 13. The index adjustment
is then made by the regulated rent.

 

 

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8.6.

A rent increase, as a result of the increase in property taxes and duties,
including a cover charge, is based on resting taxes and fees and distributed
according to the rent in effect at the time of notification, however so that any
cover charge is distributed only on the leases used for the cover charge
business.

 

9.

Lessee’s right of purchase

 

 

9.1.

The lessee has a pre-emptive purchase right to the property if the lessor wishes
to dispose of the property. Lessee must within two weeks of receipt of a
documented purchase offer notify whether lessee wants to make use of the right
of pre-emption. The right of pre-emption cannot be invoked by trade within the
Møller Hansen family or between companies controlled by the family.

 

10.

Electricity, heating, water, charges and insurance

 

 

10.1.

All expenses for supplying the leased premises with electricity, incl. charges
and any meter rent, is paid by the lessee directly to the utility company
according to separate meter. Lessee is obliged to be allowed registering with
the utility company as an independent user.

 

 

10.2.

All expenses for supplying the leased premises with heat and hot water, incl.
charges and any meter rent, is paid by the lessee directly to the utility
company according to separate meter. Lessee is obliged to register with the
utility company as an independent user.

 

 

10.3.

All expenses for supplying the leased premises with cold water, incl. charges
and any meter rent, is paid by the lessee directly to the utility company
according to separate meter. Lessee is required to register with the utility
company as an independent user.

 

 

10.4.

In addition to the rent stated in paragraph 8, the lessee pays increases in
property tax and property insurance based on prices ruling at January 1, 2019.
The lessor only holds building insurance for the buildings, and the lessee
insures own property, raw material and finished goods.

 

11.

Maintenance

 

 

11.1.

Any internal maintenance of the leased premises, including necessary renewal,
are the bearings of the lessee such that the leased premises are kept in good
and proper maintenance condition.

 

 

11.2.

Lessee's maintenance obligation includes, among other things, renovation and/or
necessary renewal of paint, wallpaper/wall coverings, exterior doors and gates,
flooring, floor coverings, installations of any kind, including heating,
ventilation, any air conditioning, extraction, lifts and elevators, interior
building parts including locks, keys, doors, door handles, door pumps, panes,
fittings, cisterns, taps, washbasins and seats, water locks, hot and cold water
installations, including cleaning of drains, electrical installations, including
contacts and switches, fixtures and light sources of all kinds, as well as home
appliances. Home appliances are provided by lessee.

 

 

11.3.

The outside maintenance is otherwise incumbent on the lessor, except for damage
caused by the lessee, his staff or other persons staying on the property with
the lessee's permission.

 

 

11.4.

The lessor is entitled - at any time - to inspect the leased property to
ascertain whether the maintenance obligation is fulfilled.

 

 

11.5.

The lessee is obliged to immediately carry out such maintenance work etc. as the
lessor rightly requires for the maintenance obligation to be fulfilled. If the
lessee without any reason, at the written request for this, has not performed
maintenance or repair work incumbent upon him, the lessor is entitled to have
the works in question performed at lessee's expense.

 

 

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12.

Cleaning and renovation

 

 

12.1.

Cleaning of the leased premises is the responsibility of the lessee, who must
always ensure that the leased premises is neat and tidy. The lessee is also
obliged to maintain the property's outdoor areas such as cleaning, snow removal,
mowing, weed control, etc.

 

 

12.2.

The lessee's renovation needs are met by the lessee's own measure and the lessee
holds all expenses thereof. Packaging and the like must not be left outside of
the leased premises, including at access areas. If such effects are stacked up
or similar, lessor is entitled to remove these at the lessee's expense.

 

13.

Security deposit

 

 

13.1.

To ensure the lessee's fulfillment of all obligations under this contract,
including payments under any separate accounts and liabilities with relocation,
the lessee pays a deposit of DKK 991,650.00 excl. VAT, equivalent to 6 months of
commencement rent. The lessee has paid DKK 375,420 on existing leases. Deposit
is charged and due for payment upon signature of lease contract and prior to
start of the construction of the extension.

          The lessor may at any time require the deposit paid to be regulated,
so it always constitutes an amount equal to 6 month’s rent.

 

 

13.2.

Deposit is not interest-bearing to tenant.

 

 

13.3.

Liqtech International A/S, reg.no. 25 12 10 31 accepts this lease contract as a
guarantor and guarantees fulfillment of all obligations under the lease,
hereunder for payment of all overdue benefits under the lease contract,
including duties if presented to the lessor.

 

14.

VAT

 

 

14.1.

This property is voluntary VAT registered and all services according to the
present contract is subject to VAT.

 

 

14.2.

VAT is a compulsory payment in the rental relationship and is paid at the same
time as the rent according to the contract.

 

15.

Signage

 

 

15.1.

The lessee is entitled to place such signs, light commercials and flagpoles as
are natural for corporate profiling.

          Signage in addition must be approved by the landlord.           The
lessee bears full responsibility for the said signage and that any radio and
television antennas comply with government requirements and orders for the area.

 

 

15.2.

If such consent is obtained, the lessee must himself ensure that the placement
is also in accordance with the property deeds and public authorities, just as
the lessee himself must obtain the necessary consent from any owner association
and bear any costs associated with the installation of such items.

 

 

15.3.

Upon relocation, the lessee must remove such installation and any trace
thereafter, if the landlord requires this.

 

16.

Sublease

 

 

16.1.

Subletting to a third party can only be done by prior written agreement with the
lessor. Sublease to a Group company can be done with information to the lessor.

 

 

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17.

Surrender and re-entry

 

 

17.1.

Lessee has the right to relinquish and re-enter the lease in accordance with the
applicable rules in the law on leasing of business premises clause 55.

 

18.

Land registration

 

 

18.1.

The Lessee may, by its own action, have its copy of the Lease Agreement
registered as the Lease Agreement complies with existing and future mortgages
and easements and possible parcellation of the property and/or division into
owner-occupied apartments.

 

 

18.2.

If the lessee has declared the lease contract, the lessee is obliged to cancel
this by the lessee's relocation.

 

19.

General conditions

 

 

19.1.

Unless otherwise agreed or following from this Agreement, the provisions of the
Danish Business Lease Act in force on the date of the Agreement apply.

 

 

19.2.

All agreements that amend or supplement this contract must be in writing in
order to be binding.

 

20.

Cost of agreement

 

 

20.1.

Each party pays the costs of its own advisers.

 

 

Date:       As lessor: As lessee: Svend Møller Hansen Ejendomme ApS   Liqtech
Systems A/S     /s/ Svend Møller Hansen /s/ Sune Mathiesen /s/ Claus Toftegård  
  Svend Møller Hansen  Sune Mathiesen Claus Toftegård

 

The undersigned Liqtech International A/S, reg.no 25 12 10 31 hereby declares as
self-insured guarantor that we are responsible for payment and fulfillment of
every obligation that Liqtech Systems A/S, reg.no. 32 56 23 02 now or later
should have towards Svend Møller Hansen Ejendomme ApS, in connection with
obligations, which has arisen in connection with this lease.

 

We are therefore aware that we will immediately pay off Svend Møller Hansen
Ejendomme ApS's receivable, which we have undertaken to guarantee if Liqtech
Systems A/S does not fulfill its obligations.

 

Payment must be made according to the signed contract.

 

The amount due must be paid within 10 working days of receipt unless the
guarantor has brought a lawsuit on this before.

 

Litigation regarding this bail is brought before the court in Aalborg.

 

Place and Date

 

As a self-guarantor:

 

Liqtech International A/S

 

/s/ Sune Mathiesen /s/ Claus Toftegård Sune Mathiesen   Claus Toftegård