Exhibit 10.11 


 


New Mexico Commercial Lease Agreement


 


This Commercial Lease Agreement ("Lease") is made
and effective March 1, 2014, by and between New Mexico Fluid Systems Tech, LLC ("Landlord") and Enerpulse, Inc ("Tenant").


 


Landlord is the owner of land and improvements commonly known
and numbered as 2451 Alamo Ave SE, Albuquerque, NM 87106 and legally described as follows (the "Building"): TR A-8A BLK
2 Summary Plat TRS A-8A & A-9A being a repl of TRS A-8 & A-9 Blk 2 Airport Industrial Park Cont 0.816 AC.


 


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.


 


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, for a "New Extended Term" beginning March 1, 2014 and ending February 28,
2016. Tenant has current possession, therefore should continue with seamless transition into the new lease.


 


B. Tenant may renew the Lease for two extended terms of two
years. Tenant shall exercise such renewal option, if at all, by giving written notice to Landlord not less than ninety (90) days
prior to the expiration of the Initial Term. The renewal term shall be at the current market rental rates and otherwise upon the
same covenants, conditions and provisions as provided in this Lease.


 


2. Rental.


 


A. Tenant shall pay to Landlord during the Initial Term rental
of $66,000 per year, payable in installments of $5,500.00 per month. Each installment payment shall be due on the first
day of each calendar month during the lease term to Landlord at 27 Blue Sage Circle, Corrales, NM 87048-9603 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. Tenant shall also leave on file with the Landlord a "Security Deposit"
in the amount of $7,810, which is on deposit.


 


B. The rental for any renewal lease term, if created as permitted
under this Lease, shall be discussed at that time.


 


 



    	 



    	 



    




 


3. Use


 


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.


 


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.


 


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.


 


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 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.


 


Tenant 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 Tenant's personal property, on the Leased Premises. Landlord shall be responsible for paying all personal
property taxes with respect to Landlord'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 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 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 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.


 


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.


 


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 Premises resulting from the removal of signs
installed by Tenant.


 


 



    	 



    	 



    




 


11. Entry.


 


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.


 


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.
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 if requested by the Landlord.


 


13. Building Rules.


 


Tenant will comply with the rules of the Building adopted and
altered by 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. The initial rules for the Building are attached hereto as Exhibit
"A" and incorporated herein for all purposes.


 


14. Damage and Destruction.


 


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 shall have the right within ninety (90) days following damage to elect by notice to Landlord to
terminate this Lease as of the date of such damage. In the event of minor damage to any part of the Leased Premises, and if such
damage does not render the Leased Premises unusable for Tenant's purposes, Landlord shall promptly repair such damage at the cost
of the Landlord. In making the repairs called for in this paragraph, Landlord shall not be liable for any delays resulting from
strikes, governmental restrictions , inability to obtain necessary materials or labor or other matters which are beyond the reasonable
control of Landlord. 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.


 






    	 



    	 



    

 


 


15. Default.


 


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 fifteen (15) 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 thirty (30) 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.


 


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.


 


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.


 


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 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.


 


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.


 


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, addressed as follows:


 


If
to Landlord to:


 


New Mexico Fluid Systems Technologies

PO Box 91867, Albuquerque, NM 87199-1867





 


If to Tenant to:


 


Enerpulse, Inc


2451 Alamo Ave SE, Albuquerque, NM 87106






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.


 


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.


 


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. Memorandum of Lease.


 


The parties hereto contemplate that this Lease should not and
shall not be filed for record, but in lieu thereof, at the request of either party, Landlord and Tenant shall execute a Memorandum
of Lease to be recorded for the purpose of giving record notice of the appropriate provisions of this Lease.


 


24. Headings.


 


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.


 


25. Successors.


 


The provisions of this Lease shall extend to and be binding
upon Landlord and Tenant and their respective legal representatives, successors and assigns.


 


 


 



    	 



    	 



    







 


26. Consent.


 


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.


 


27. Performance.


 


If there is a default with respect to any of Landlord's covenants,
warranties or representations under this Lease, and if the default continues more than fifteen (15) days after notice in writing
from Tenant to Landlord specifying the default, Tenant may, at its option and without affecting any other remedy hereunder, cure
such default and deduct the cost thereof from the next accruing installment or installments of rent payable hereunder until Tenant
shall have been fully reimbursed for such expenditures, together with interest thereon at a rate equal to the lesser of twelve
percent (12%) per annum or the then highest lawful rate. If this Lease terminates prior to Tenant's receiving full reimbursement,
Landlord shall pay the unreimbursed balance plus accrued interest to Tenant on demand.


 


28. Compliance with Law.


 


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.


 


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.


 


This Agreement shall be governed, construed and interpreted
by, through and under the Laws of the State of New Mexico.


 






    	 



    	 



    

 


 


IN WITNESS WHEREOF, the parties have executed this Lease as
of the day and year first above written.


  


 


 


 


 


 


 /S/ Jeff Thompson


 





Jeff Thompson


 


New Mexico Fluid Systems


 






 /S/ Bryan C Templeton


 





Bryan C Templeton


 


Enerpulse, Inc