officesublease.htm


    

      
        
           


        

        
           


          
            

          

        

        
           


        

      


      OFFICE
SUBLEASE

      


      This Office Sublease (“Sublease”) is
made effective as of September 30, 2008, by and between SEVEN INDUSTRIES, LTD., a
Michigan Corporation d/b/a Seven Capital (“Sub-Landlord”), and Ecology
Coatings, Inc., a Nevada
corporation (“Sub-Tenant”), upon the following terms and
conditions.

      


      
        	
                1.

              	
                Description of the
      Premises. Sub-Landlord entered into a lease for office space
      (“Master Lease”) located on land and improvements known as the Champion
      Building, 2701 Cambridge Court, Auburn Hills, Michigan 48326 (the
      “Building”).  Sub-Landlord has full right and authority to enter
      into a sublease regarding the Building. Sub-Landlord subleases to
      Sub-Tenant and Sub-Tenant hires from Sub-Landlord Suite 100 of said
      property for its operations (the “Premises”).  There shall be no
      leasehold improvements made to the property without the prior written
      consent of the Sub-Landlord.  Any leasehold improvements made by
      Sub-Tenant shall be paid by the
Sub-Tenant.

              


      

      
        	
                2.

              	
                Common Areas.
      Sub-Landlord shall also ensure that areas and facilities of common benefit
      are made available to the tenants and occupants of the Premises, including
      parking areas, driveways, sidewalks and ramps, service areas, hallways,
      lighting facilities, and landscaped areas (the “Common
      Areas”).  Sub-Landlord shall ensure that the Common Areas are
      operational, managed, equipped, well-lit, insured, repaired, and
      maintained. All Common Areas shall be under the exclusive control and
      management of the Sub-Landlord and any party required under the Master
      Lease.

              


      

      
        	
                3.

              	
                Term. This
      Sublease shall be for the term of two (2) years commencing on September
      30, 2008, (the “Commencement Date”) and ending on September 30,
  2010.

              


      

      
        	
                4.

              	
                Rental.  Sub-Tenant
      shall pay to Sub-Landlord a monthly rent shown in the below schedule,
      payable in advance, on the first day of each month during the term of this
      Sublease. All rent shall be paid to Sub-Landlord at the address 2701
      Cambridge Court, Suite 420, Auburn Hills, Michigan 48326, or at any other
      address that Sub-Landlord designates in writing, without any prior demand
      by Sub-Landlord and without any deduction or
  offset.

              


      

      
        	
                 
      

              	
                Monthly Rent
      Schedule

              


      

      


      
        	
                RENTAL
      PERIOD

              	
                MONTHLY
      RENT

              
	
                Commencement
      Date – 11/30/08

              	
                $2,590.52

              
	
                12/1/08
      – 11/30/2009

              	
                $2,951.76

              
	
                12/1/2009
      –5/31/2010

              	
                $3,119.03

              
	
                6/1/2010
      - 9/30/2010

              	
                $3,154.17

              


      

      


      If Sub-Tenant fails to pay any amount
it owes to Sub-Landlord under this Sublease when that amount is due, the amount
shall be assessed a one-time late charge of $200.00 and shall be subject to
a service charge until it is paid at the lesser of the rate of 2 percent per
month or the highest rate permitted by law.

      
        	
                5.

              	
                Operating
      Expenses. All operating expenses have been included in the
      rent.

              


      

      
        	
                6.

              	
                Use. Sub-Tenant
      shall use and occupy the Premises as a general office and for no other
      purpose without the prior written consent of Sub-Landlord. Sub-Tenant
      shall not intentionally and knowingly use the Premises for any purpose or
      in any manner in violation of any law, ordinance, rule, or regulation
      adopted or imposed by any federal, state, county, or municipal body or
      other governmental agency. Sub-Tenant shall not deface or injure the
      Premises or the Building, permit anything to be done on the Premises
      tending to create a nuisance or to disturb other tenants in the Building,
      or permit any activity in the Premises that will result in an increase of
      any insurance premium on the Premises or the
  Building.

              


      

      
        	
                7.

              	
                Taxes.
      Sub-Landlord shall remain responsible, as determined under the Master
      Lease, for all taxes and special assessments levied against the land and
      improvements on and in which the Premises are situated. Sub-Tenant shall
      pay all personal property taxes assessed against any personal property
      owned by Sub-Tenant on the
Premises.

              


      

      
        	
                8.

              	
                Maintenance and
      Repair. Sub-Landlord shall ensure that the Premises and the Common
      Areas are maintained and kept in good condition and repair, including the
      exterior windows, the heating and air-conditioning equipment, and the
      electrical and plumbing systems. Sub-Landlord shall be obligated to ensure
      repairs are made only after Sub-Tenant has given Sub-Landlord written
      notice of the need for the repair, and only if the repair was not caused
      by the negligence or willful act of Sub-Tenant or its agents, employees,
      invitees, or licensees.

              


      

      Sub-Landlord shall ensure that a
regular janitorial service is provided and paid for to maintain the Premises in
a neat and clean condition. Sub-Tenant shall be responsible for all repairs or
replacements occasioned by the negligence or willful act of Sub-Tenant or its
agents, employees, invitees, or licensees.

      
        	
                9.

              	
                Assignment and
      Subletting. Sub-Tenant agrees not to sell, assign, mortgage,
      pledge, or in any manner transfer this Sublease or sublet the Premises or
      any portion of the Premises without Sub-Landlord’s prior written consent,
      which shall not be unreasonably withheld. In the event of any assignment
      or sublease, Sub-Tenant shall remain fully liable on this Sublease.
      Sub-Landlord’s right to assign this Sublease is unqualified. Upon any sale
      of the Premises in which the purchaser assumes all obligations under this
      Sublease, Sub-Landlord shall be entirely free of all obligations of the
      landlord under this Sublease and shall not be subject to any liability
      resulting from any act, omission, or event occurring after the conveyance.
      Sub-Tenant agrees to recognize and attorn to any such transferee, and
      Sub-Tenant further agrees, at Sub-Landlord’s request, to sign and deliver
      a recordable document setting forth the provisions of this
      paragraph.

              


      

      
        	
                10.

              	
                Utilities. All
      utility expenses have been included in the rent. Sub-Landlord shall
      provide all utilities, including electricity, heat, air-conditioning,
      ventilation, water, and sewer services.  Except for
      Sub-Landlord’s negligence, Sub-Landlord shall not be liable for damages
      should the furnishing of any utilities be interrupted by fire or other
      casualty, accident, strike, labor dispute or disagreement, the making of
      any necessary repairs or improvements, or any other causes beyond the
      reasonable control of Sub-Landlord.

              


      

      
        	
                11.

              	
                Insurance.
      Sub-Landlord shall ensure that the proper party under the Master Lease
      insures the Building, including the Premises and the Common Areas, against
      loss or damage under a policy of fire or extended coverage insurance in
      amounts that Sub-Landlord and owner deem
  appropriate.

              


      

      Except for Sub-Landlord’s negligence,
Sub-Tenant shall indemnify Sub-Landlord and keep Sub-Landlord harmless from any
liability or claim for damages that may be asserted against Sub-Landlord because
of any accident or casualty occurring on or about the Premises.  Any
insurance maintained by either party pursuant to this paragraph shall contain a
clause or endorsement under which the insurer waives all rights of subrogation
against the other party or its agents or employees with respect to losses
payable under the policy.

      Any personal property kept on the
Premises by Sub-Tenant shall be kept there at Sub-Tenant’s sole
risk.

      
        	
                12.

              	
                Acceptance of
      Premises. The opening by Sub-Tenant of its business in the Premises
      shall constitute an acknowledgment by Sub-Tenant that the Premises are
      then in acceptable condition.

              


      

      
        	
                13.

              	
                Damage or
      Destruction. If, during the term of this Sublease, the Premises are
      partially or totally destroyed by fire or other casualty covered by
      insurance so as to become partially or totally untenantable, the Premises
      shall be repaired as quickly as possible as determined under the Master
      Lease unless this Sublease is terminated as provided below. In the event
      of such damage or destruction, and if this Sublease is not terminated,
      there shall be no abatement or reduction in the rent payments due under
      this Sublease.

              


      

      If, during the term of this Sublease,
the Premises or the Building is partially or totally destroyed by fire or other
casualty, and the Master Lease is terminated, Sub-Landlord shall have the right
to terminate this Sublease. Upon the giving of the notice, this Sublease shall
terminate as of the date on which the damage occurred, and the rent shall be
adjusted to that date. If the notice by Sub-Landlord is not given, this Sublease
shall continue and Sub-Landlord shall cause the Premises or the Building to be
repaired or restored with due diligence.

      
        	
                14.

              	
                Condemnation.
      If the whole or any part of the Premises is taken by any public authority
      under the power of eminent domain, including any conveyances or grants
      made in anticipation of, or in lieu of, such a taking, then the term of
      this Sublease shall cease on that part of the Premises to be taken from
      the day the possession of that part shall be acquired by public authority,
      and the rent shall be paid up to that date. If the taking of a portion of
      the Premises substantially impairs the usefulness of the Premises for the
      purpose for which the Premises were leased, Sub-Tenant shall have the
      right either to terminate this Sublease or to continue in the possession
      of the remainder of the Premises under the terms and conditions of this
      Sublease, except that the rent shall be reduced in proportion to the
      amount of the Premises taken and, in the latter event, Sub-Landlord shall
      promptly restore the remainder to a reasonably tenantable condition. All
      damages awarded for the taking shall belong to and be the property of
      Sub-Landlord as determined under the Master Lease, whether the damages are
      awarded as compensation for diminution of value of the leasehold or to the
      fee of the Premises. However, Sub-Landlord shall not be entitled to any
      award made to Sub-Tenant for the costs of removing fixtures or for
      business interruption.

              


      

      
        	
                15.

              	
                Alterations. No
      improvements, alterations, additions, or physical changes shall be made on
      the Premises by Sub-Tenant without the Sub-Landlord’s prior written
      consent. Sub-Tenant shall not paint or decorate any part of the interior
      or exterior of the Premises or attach or hang any curtains, blinds,
      shades, screens, awnings, or other projections to the interior or exterior
      of any window of the Premises or on the outside wall of the Building.
      Also, Sub-Tenant shall not attach or exhibit any sign, display, lettering,
      or advertising matter of any kind on the exterior walls or corridors of
      the Building or on any window or door of the Premises without
      Sub-Landlord’s prior written consent. All alterations and improvements,
      but not moveable equipment and trade fixtures, put in at the expense of
      Sub-Tenant shall be the property of Sub-Tenant and shall remain on and be
      surrendered with the Premises at the termination of the Sublease. However,
      Sub-Landlord may require that Sub-Tenant remove the alterations and
      improvements and repair any damages to the Premises caused by the
      removal.

              


      

      
        	
                16.

              	
                Signs.
      Sub-Landlord shall ensure that appropriate signs are provided on the
      exterior of the Building and in the Common Areas. Sub-Tenant shall, at its
      own expense, be responsible for any of its signs on the exterior of the
      Premises. Sub-Landlord reserves the right to require uniform signs for all
      tenants, and no sign or other advertising or lettering shall be placed on
      the exterior walls or corridors of the Building or on any windows or doors
      of the Premises without Sub-Landlord’s prior
  consent.

              


      

      
        	
                17.

              	
                Remedies and
      Default. If Sub-Tenant does any of the
  following:

              


      

      
        	
                 
      

              	
                a.

              	
                defaults
      in paying any sums to Sub-Landlord when due, including rent and additional
      rent, and does not cure the default within 10
  days;

              


      

      
        	
                 
      

              	
                b.

              	
                defaults
      in performing any other covenant or condition of the Sublease and does not
      cure the other default within 30 days after written notice from
      Sub-Landlord specifying the default;
or

              


      

      
        	
                 
      

              	
                c.

              	
                is
      adjudicated to be bankrupt or makes any assignment for the benefit of
      creditors;

              


      

      Then
Sub-Landlord may:

      
        	
                a.  

              	
                accelerate
      the full balance of the rent payable for the remainder of the term and sue
      for the sums due;

              


      

      
        	
                b.  

              	
                terminate
      this Sublease; or

              


      

      
        	
                c.  

              	
                without
      terminating this Sublease, reenter the Premises and dispossess Sub-Tenant
      or any other occupant of the Premises, remove Sub-Tenant’s effects, and
      relet the Premises for the account of Sub-Tenant for rent and upon terms
      that are satisfactory to Sub-Landlord, crediting the proceeds, after
      deducting the costs and expense of reentry, alterations, additions, and
      reletting, to the unpaid rent and the other amounts due under this
      Sublease during the remainder of the term, and Sub-Tenant shall remain
      liable to Sub-Landlord for the balance
owed.

              


      

      If suit is brought to recover
possession of the Premises, to recover any rent or any other amount due under
the provisions of this Sublease, or because of the breach of any other covenant
to be performed by Sub-Tenant, and a breach is established, then Sub-Tenant
shall pay to Sub-Landlord all expenses incurred in the action, including
reasonable attorney fees, which shall be deemed to have been incurred on the
commencement of the action and shall be enforceable whether or not the action is
prosecuted to judgment.

      
        	
                18.

              	
                Access to
      Premises. Sub-Landlord and any party required under the Master
      Lease shall have the right to enter the Premises at all reasonable hours,
      provided that the entry does not interfere with the operation and conduct
      of Sub-Tenant’s business. Sub-Landlord and any party required under the
      Master Lease shall have the right to use all or any part of the Premises
      to install, maintain, use, repair, and replace pipes, ducts, lights,
      conduits, plants, wires, floor coverings, and all other mechanical
      equipment serving the Premises in locations within the Premises that will
      not materially interfere with Sub-Tenant’s use of the
      Premises.

              


      

      
        	
                19.

              	
                Rules and
      Regulations. Sub-Landlord reserves the right to adopt from time to
      time rules and regulations for the operation of the Building that are
      customary for buildings of this character and are not inconsistent with
      the provisions of this Sublease. Sub-Tenant and its agents, employees,
      invitees, and licensees shall comply with all rules and
      regulations.

              


      

      
        	
                20.

              	
                Waiver.
      Sub-Landlord’s failure to insist on a strict performance of any of the
      terms, covenants, or conditions of this Sublease shall not be deemed a
      waiver of any subsequent breach or default in the terms, covenants, and
      conditions in this Sublease. This Sublease may not be changed, modified,
      or discharged orally.

              


      

      
        	
                21.

              	
                Notices. All
      notices required under this Sublease shall be in writing and shall be
      deemed to be given if either delivered personally or mailed by certified
      or registered mail to Sub-Landlord or to Sub-Tenant at their respective
      addresses set forth in this Sublease or to any other address that either
      party furnishes in writing during the term of this
    Sublease.

              


      

      
        	
                22.

              	
                Quiet
      Enjoyment. Sub-Landlord covenants and agrees with Sub-Tenant and
      its successors and assigns that, upon Sub-Tenant’s paying the rent and
      observing and performing all the terms, covenants, and conditions on
      Sub-Tenant’s part to be performed and observed, Sub-Tenant may peaceably
      and quietly hold, occupy, possess, and enjoy the Premises for the full
      term of this Sublease.

              


      

      
        	
                23.

              	
                Subordination to
      Mortgage. Any mortgage now or later placed upon any property of
      which the Premises are a part shall be deemed to be prior in time and
      senior to the rights of Sub-Tenant under this Sublease. Sub-Tenant
      subordinates all of its interest in the leasehold estate created by this
      Sublease to the lien of any mortgage of Sub-Landlord. Sub-Tenant shall, at
      Sub-Landlord’s request, sign any additional documents necessary to
      indicate this subordination.

              


      

      Notwithstanding the foregoing,
Sub-Tenant’s possession of the Premises under this Sublease shall not be
disturbed by any mortgagee, trustee under a trust deed, owner, or holder of a
note secured by a mortgage or trust deed now existing or later placed on the
Premises, unless Sub-Tenant breaches any of the provisions of this Sublease and
the lease term of Sub-Tenant’s right to possession is lawfully terminated in
accordance with the provisions of this Sublease.

      
        	
                24.

              	
                Security
      Deposit. Sub-Tenant has not deposited a security deposit with
      Sub-Landlord.

              


      

      
        	
                25.

              	
                Changes by
      Sub-Landlord. Sub-Landlord and any proper party under the Master
      Lease reserve the absolute right at any time and from time to time to make
      changes or revisions in the Building, parking lot, driveways, signs,
      landscaping, and sidewalks, including additions to, subtractions from, or
      rearrangements of the improvements, provided that the changes do not
      materially alter the use of the
Premises.

              


      

      
        	
                26.

              	
                Holding Over.
      If Sub-Tenant remains in possession of the Premises after the expiration
      or termination of the Sublease and without signing a new lease, it shall
      be deemed to be occupying the Premises as a tenant from month to month at
      twice the minimum rent (as adjusted in this Sublease), subject to all the
      conditions, provisions, and obligations of this Sublease insofar as it can
      be applicable to a month-to-month tenancy, cancelable by either party upon
      seven days’ written notice to the
other.

              


      

      
        	
                27.

              	
                Recording.
      Sub-Tenant shall not record this Sublease without the written consent of
      Sub-Landlord.

              


      

      
        	
                28.

              	
                Captions and
      Headings. The captions and headings used in this Sublease are
      intended only for convenience and are not to be used in construing this
      Sublease.

              


      

      
        	
                29.

              	
                Applicable Law.
      This Sublease shall be construed under the laws of the State of Michigan.
      If any provision of this Sublease or portions of this Sublease or their
      application to any person or circumstances shall, to any extent, be
      invalid or unenforceable, the remainder of this Sublease shall not be
      affected and each provision of this Sublease shall be valid and
      enforceable to the fullest extent permitted by
  law.

              


      

      
        	
                30.

              	
                Successors.
      This Sublease and its covenants and conditions shall inure to the benefit
      of and be binding on Sub-Landlord and its successors and assigns and shall
      be binding on Sub-Tenant and permitted assigns of
    Sub-Tenant.

              


      

      
        	
                31.

              	
                No Partnership.
      Any intention to create a joint venture or partnership between the parties
      is expressly disclaimed.

              


      

      
        	
                32.

              	
                Recovery by
      Sub-Tenant. Sub-Tenant agrees to look solely to the interest of
      Sub-Landlord in the land and improvements on which the Premises are
      situated to satisfy any judgment against Sub-Landlord as a result of any
      breach by Sub-Landlord of its obligations under this Sublease. No other
      property of Sub-Landlord or any partners shall be subject to levy or
      execution as a result of any claim by Sub-Tenant against Sub-Landlord
      arising out of the relationship created by this
  Sublease.

              


      

      
        	
                33.

              	
                Estoppel
      Agreement. At the request of Sub-Landlord, Sub-Tenant shall, within
      10 days, deliver to Sub-Landlord, or anyone designated by Sub-Landlord, a
      certificate stating the Commencement Date and the term and certifying, as
      of that date, the date to which rent, additional rent, and other charges
      under this Sublease are paid, that this Sublease is unmodified and in full
      force, and that Sub-Landlord is not in default under any provision of this
      Sublease or, if the Sublease is modified or if Sub-Landlord is in default,
      stating the modification or the nature of the default and the amount of
      any claims.

              


      

      
        	
                34.

              	
                Effective Date.
      Sub-Landlord and Sub-Tenant have signed this Sublease and it shall be
      effective on the date listed at the beginning of this
      agreement.

              


      

      


      


      SUB-LANDLORD                                                                                      SUB-TENANT

       

      SEVEN
INDUSTRIES,
LTD.,                                                                                                Ecology Coatings,
Inc.,

      a
Michigan
Corporation                                                                                                a Nevada
corporation

      


      


      By:  /s/ JB
Smith________                                                                                                 By:  /s/ Robert G.
Crockett

      JB
SMITH                                                                                                             Robert G.
Crockett

      
        	
                Its:  Managing
      Partner

              	 	
                Its:   CEO