Exhibit 10.4




LEASE




THIS
LEASE made this 29th day of June, 2007 by and between WALES REALTY, LLC, a
Connecticut Limited Liability Company with a principal place of business located
at 275 New State Road, in the Town of Manchester County of Hartford, State of
Connecticut, (hereinafter referred to a "Landlord"), and VeruTEK TECHNOLOGIES,
INC. a Connecticut corporation with a place of business located at 65 West
Dudley Town Road, in the Town of Bloomfield, County of Hartford, State of
Connecticut (hereinafter referred to as "Tenant");




WITNESS
ETH:




1.  Lease of Premises-
For and in consideration of the rents herein reserved, and the covenants and
conditions herein contained, the Landlord hereby leases to the Tenant and the
Tenant hereby hires from the Landlord, that certain tract of land situated in
Bloomfield, Connecticut (hereinafter, "Land") consisting of approximately 2.0
acres, as further described in Exhibit A which is attached hereto, together with
all improvements thereon (hereinafter, "Building"). The Building is further
described as a free standing building containing approximately 24,000 square
feet having a street address of 65 West Dudley Town Road. The Tenant hereby
hires from the Landlord and Landlord leases to Tenant a 8,800 square feet
portion of the Building as per the attached plan (hereinafter, "Improvements").
The Land and Improvements are sometimes collectively referred to in this Lease
as the "Premises." In addition, Tenant shall have use of twenty five (25)
parking spaces.




2.  Use of Premises- The
Tenant shall use and occupy the Improvements for office, laboratory and
manufacturing operations, only and for no other purpose without the prior
written consent of the Landlord which consent shall not be unreasonably withheld
or delayed. The Tenant hereby warrants that no toxic or hazardous materials
shall be stored, utilized or disposed of on the Premises in excess of amounts
permitted under applicable law. In the event of any such storage, use or
disposal, Tenant shall be liable for any costs reasonably incurred by the
Landlord in connection with, or arising out of, the storage, use or disposal of
said toxic or hazardous materials. The term "toxic or hazardous materials" shall
be as defined by applicable State and Federal laws and regulations. Landlord
acknowledges that Tenant's operation on the Premises will require the use of
certain materials which may be considered "toxic or hazardous materials" under
applicable law. Landlord hereby consents to the use of such materials, provided
that all such materials are used, stored and disposed of in accordance with the
requirements of applicable laws.




3. Term of Lease- The
term of this lease shall be for a period of five (5) years, commencing on August
1, 2007 (the "Commencement Date") and ending July 31, 2012. From the date of
mutual execution of this Lease, through the Commencement Date, the Landlord
shall permit the Tenant to have access to the Premises for the purpose of
permitting the Tenant and its agents and contractors to make alterations to the
Improvements so that the Premises, as of the Commencement Date will be fit for the
conduct of the Tenant's business thereon. During the period prior to the
Commencement Date, the Landlord and the Tenant will cooperate and coordinate
with one another so that the work for which they are each responsible for prior
to the Commencement Date can be done in as efficient and expeditious manner as
possible.






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4.  Base Rent-The Tenant
agrees to pay the Landlord as rent, without rights of set off, deduction, or
necessity for demand, for each of the years as follows. The first month's rent
shall be paid prior to the Tenant obtaining possession of the
Premises.




YEAR
            YEARLY RENT
            MONTHLY RENTCommencement
      Date –July 31, 2008
            $38,000.00
            $3,166.67August
      1, 2008 – July 31, 2009
            $39,000.00
            $3,250.00August
      1, 2008 – July 31, 2010
            $40,000.00
            $3,333.33August
      1,
      2008                                July
      31, 2011
            $41,000.00
            $3,416.67August
      1, 2008 – July 31, 2012
            $42,000.00
            $3,500.00







The
foregoing rent is allocated as follows:




$3,166.67
base rent adjusted as provided above


$ 833.33
initial estimated additional rent due under Paragraph 33 until such time as
adjusted pursuant to Paragraph 33.




The
foregoing rent shall be payable in equal monthly installments in advance,
commencing on the first day of the first full calendar month following the
Commencement Date and on the first day of each and every calendar month
thereafter. If the Commencement Date is not the first day of the month, rent for
the initial partial month shall be pro-rated based upon the actual number of
days in such month and the number of days from the Commencement Date until the
last day of such month. In the event said rent is not actually received by the
Landlord within ten (10) days, the Tenant shall be responsible for a late charge
of $10.00 per day for every day that said rent is late beyond the ten (10) days
up to a maximum charge of $150.00. Said late charges shall be considered
liquidated damages for said late payment, but shall in no event affect any other
damages to which the Landlord may be entitled as a result of the Tenant's late
payment, i.e. back rent, unpaid charges, costs of collection, etc. In the event
that the Landlord elects to terminate this lease the Tenant's liability for said
late charge payment shall cease on the date of said election but the Tenant
shall be liable for damages in accordance with Paragraph 11 hereof following the
date of said election to terminate. The first installment of rent shall be paid
prior to the Tenant taking possession of the Premises.




5.  Assignment and Subletting- The Tenant agrees not to assign this lease or any interest therein or
sublet the Premises or any portion thereof, without the prior written approval
of Landlord, which approval shall not be unreasonably withheld or delayed, but
notwithstanding any assignment
or subleasing, Tenant shall remain liable for all the terms, covenants, and
conditions of this lease. If the Tenant is a corporation, a transfer of 50% or
more of the Tenant's stock shall be considered to be an assignment or sublet for
purposes of this Paragraph. Any such sublet or assignment shall be subject to
the terms and provisions of this lease and the termination or other expiration
of this lease shall terminate any such sublease or assignment.






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6.  Indemnity- The
Tenant agrees to indemnify and save Landlord harmless against and from any and
all claims, damages, costs and expenses, including reasonable attorney's fees,
arising from the conduct or management of the business conducted by the Tenant
in the leased Premises, or from any breach or default on the part of the Tenant
in the performance of any covenant or agreement on the part of the Tenant to be
performed pursuant to the terms of this lease, or from any act or negligence of
the Tenant, its agents, contractors, servants, employees, subleases,
concessionaires or licensees in or about the leased Premises. In case any action
or proceeding be brought against the Landlord by reason of any such claim,
Tenant, upon notice from Landlord, covenants to defend such action or proceeding
and reimburse the Landlord for its reasonable expenses in connection
therewith,




7.  Limitation of Landlord's
Liability- The Landlord shall not be liable for:


(a)  Loss of
or damage to any property of the Tenant or of any other person entrusted to the
Tenant;




(b)  Loss of
or damage to any property of the Tenant or of any person by theft or
otherwise;


(c)  Any
injury or damage to any person or property resulting from fire, explosion,
falling plaster, steam, gas, electricity, dust, water or snow or leaks from any
part of the building or from the pipes, appliances or plumbing system or any
other place or by dampness or from any other cause whatsoever;




(d)  Any
damage caused by other occupants or persons in the building leased to Tenant;
or




(e)  Any
latent defects in the building;


(f)  Any
interruption of services, utilities, or similar items to be provided for by the
Landlord pursuant to this lease.


The
foregoing provisions of this Paragraph 7 shall not excuse Landlord from its own
negligence or willful misconduct or the negligence or willful misconduct of its
employees, agents and contractors. Landlord shall indemnify, defend and save
Tenant harmless from any and all claims, damages, losses costs and expenses
resulting from the negligence and/or willful misconduct and acts of Landlord,
its employees, agents and contractors on or about the Premises,




8. Insurance- The
Tenant shall keep in force during the term of this lease public liability
insurance with recognized companies licensed in the State of Connecticut with
liability limits of not less than $1,000,000.00 for bodily injury and other
casualty and arising out of the occupancy, maintenance and use of the Premises
and $1,000,000.00 for contents/personal property damage.







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In the
event that Tenant wishes to maintain contents/personal property limits at an
amount less than $1,000,000, Tenant shall provide sufficient proof of adequate
coverage and shall make no claim against Landlord in the event that said
coverage is insufficient.. Tenant will name the Landlord as an additional
insured on all policies of insurance, and will furnish the Landlord with a copy
of the policy or policies within ten (10) days of the execution of this lease
and further proof of said insurance as the Landlord may require. Neither party
shall be liable for damages covered by insurance.




Throughout
the term of this Lease, Landlord shall maintain a policy of fire and extended
casualty insurance covering the Premises in an amount equal to the full
replacement cost of the Premises and liability coverage with respect to the
Premises with limits of not less that $1,000,000.00 for bodily injury and
$1,000,000.00 for property damage with the Tenant named as an additional insured
thereunder. All such insurance shall be issued by recognized companies licensed
in the State of Connecticut. Tenant shall be responsible for payment of its
proportionate share as provided in Paragraph 33.




Landlord
and Tenant each hereby waives on behalf of all insurers under all policies of
insurance (casualty or liability) carried by either covering the Premises or any
part thereof or any operations or activities thereon, all rights of subrogation
which any insurer might otherwise have, if at all, to any claims of Landlord or
Tenant against the other.




9.  Compliance With Law-
Tenant agrees to comply and operate its business in accordance with all
statutes, laws, ordinances, regulations and rules of the United States, the
State of Connecticut, the town in which the Premises are located and any other
governmental subdivisions claiming jurisdiction so far as the Premises are or
may be concerned.




10.  Subordination to Mortgages- This lease shall not take precedence over any mortgage with any
individual, savings bank, commercial bank or insurance company or other
recognized lending institution, which may be placed, or arranged upon the
Premises, but any mortgage so placed or arranged at all times after the
execution hereof until the end of the term of this lease shall be prior to any
rights the Tenant may have in the Premises by reason of this lease, to the same
effect as though said mortgage had been executed before this lease and recorded
within a reasonable time thereafter, provided that no such subordination shall
occur unless the lender in question delivers to Tenant an agreement in form and
substance reasonably satisfactorily to Tenant pursuant to which such lender
agrees not to name Tenant as a defendant in a foreclosure action or disturb
Tenant in its enjoyment of the Premises and recognizing the rights of Tenant
under this Lease, so long as Tenant is not in default hereunder.




11. Default- If default
be made in the payment of rent herein reserved or any part thereof for ten (10)
days after written notice from Landlord or if default be made in any of the
other covenants and agreements herein contained to be kept by the Tenant which
default (other than nonpayment of rent) is not cured within thirty (30) days
following notice to the Tenant, provided however, if such default cannot
reasonably be cured within thirty (30) days, Tenant shall not be in
default hereunder as long as Tenant commences such cure within such thirty (30)
day period, or if the Tenant shall make an assignment for the benefit of
creditors, or if a receiver or trustee of the Tenant's property shall be
appointed which is not removed within sixty (60) days, then it shall be lawful
for the Landlord at the Landlord's election to declare said term ended and to
re-enter the Premises or any part thereof without such re-entry working a
forfeiture of rents to become due hereunder, either with or without process of
law, and to expel, remove, and put out the Tenant or any person or persons
occupying the same, using such force as may be necessary so as to repossess and
enjoy the demised Premises as before this demise, without prejudice to any
remedies which the Landlord might otherwise have.





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(a)  In the
event that this lease is terminated, the Landlord shall make reasonable effort
to re-let the Premises, but shall have the sole authority to determine and
receive the rent therefore, applying the same to the payment of the rent due by
these presents, including reasonable expenses of re-rental such as advertising,
rental commission, decorating and repairs and, if the full rental herein
provided shall not be realized by the Landlord over and above such expenses of
reletting, the said Tenant shall pay any deficiency in all events and shall
remain liable for failure to comply with all the other terms, covenants and
conditions of this lease. Said deficiency shall be computed by subtracting the
amount of rent that the Landlord is scheduled to receive from any re-rental from
the amount of rent that the Tenant would have paid throughout the term of this
lease. The Landlord shall compute the amount of said damages and shall render a
statement to the Tenant for said amount. The Tenant shall each month make a
payment equal to the difference between the rent due under this Lease and the
rent due under such sublease for such month. In addition to the foregoing, the
Tenant shall be liable for all other damages suffered by the Landlord in the
event of a breach of this lease.




(b)  The
Landlord shall have, in addition to the rights and remedies of the Landlord
enumerated in this lease (which shall be cumulative), such other rights and
remedies as may be allowed by law or in equity. If the Landlord engages the
services of an attorney-at-law after a default as aforesaid, the Tenant shall
reimburse the Landlord for the actual amount of costs reasonably incurred plus a
reasonable attorney's fee. In the event there are any sums due the Landlord by
the Tenant following said breach, and said sums are not paid within thirty (30)
days after the time they become due, the Tenant shall pay to the Landlord
interest on said sums at the rate of one percent (1%) per month.




12. Alterations-




(a) The
Tenant may, at its own expense, make improvements to the property as it may deem
necessary or expedient in the operation of the leased property, provided the
Tenant, without the written consent of the Landlord, shall not tear down or
materially demolish any of the improvements on the leased property, or make any
material changes or alterations in such improvements without the prior consent
of the Landlord, which consent shall not be unreasonably withheld or delayed.
Tenant shall not make any change in or alteration to the leased property which
would violate the terms of any mortgage on the leased property, or of any policy
of insurance in force with respect to the leased property.







Landlord
hereby acknowledges that Tenant has informed Landlord of its plans for
alteration as set forth in Schedule 12, attached hereto, to be made to the
Premises by Tenant at a future date and Landlord consents to such
alterations.




(b)
Subject to the foregoing, the Tenant shall have the right to make changes or
alterations to the building on the leased property so long as:




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(i)  No change
or alteration shall at any time be made which shall impair the structural
soundness or diminish the value of the building on the leased
property.




(ii)  Before
commencing any changes or alterations the Tenant shall procure and deliver to
the Landlord the written consent of the mortgagee to which the lease is
subordinate and Landlord shall assist Tenant in procuring such
consent.


(iii)  No change
or alteration shall be undertaken until the Tenant shall have procured and paid
for all required municipal and other governmental permits and authorizations of
the various municipal departments and governmental subdivisions having
jurisdiction.




(iv)  All work
done in connection with any change or alteration shall be done in a good and
workmanlike manner and in compliance with the building and zoning laws, and with
all other laws, ordinances, orders, rules, regulations, and requirements of all
Federal, State, and municipal governments in the appropriate departments,
commissions, boards, and their officers thereof, and in accordance with the
orders, rules, and regulations of the Board of Fire Underwriters or any other
body now or hereafter constituted exercising similar functions, and the Tenant
shall procure certificates of occupancy and other certificates required by
law.




(v) At
all times when any change or alteration is in progress, there shall be
maintained, at the Tenant's expense, Workers Compensation Insurance in
accordance with the law covering all persons employed in connection with the
change or alteration, and general liability insurance for the mutual benefit of
the Tenant and the Landlord expressly covering the additional hazards due to the
change or alteration.




(c) The
Landlord and Tenant agree to make the improvements to the Premises as set forth
in Schedule 12 prior to or in a reasonable time after the Commencement Date.
Landlord and Tenant agree that Landlord shall contribute the reasonable cost of
said improvements up to a maximum amount of Ninety Thousand ($90,000) Dollars
which improvements do not include the construction of the laboratory. Payments
of Landlord's payment shall be made by Landlord directly to the provider of
goods and/or services within thirty (30) days and shall be conditioned upon the
delivery of a mechanic's lien waiver.




13. Non-Waiver- The
failure of the Tenant to seek redress for violation of, or to insist upon the
strict performance of, any covenant or condition of this lease shall not
(notwithstanding any former waiver) prevent a subsequent act, which would have
originally constituted a violation, from having all the force and effect of an
original violation. The receipt by the Landlord of rent with knowledge of the
breach of any covenant or condition of this lease shall not be deemed a waiver
of such breach. It is further agreed that in the event any such rental payment
is made by the Tenant after written notice of a breach of any portion of this
agreement was given Tenant by Landlord,
all rental monies forwarded to Landlord after Tenant's receipt of said notice,
shall be accepted by the Landlord only as compensation for reasonable use and
occupancy of the demised Premises. No provision of this lease shall be deemed to
have been waived by the Landlord unless such waiver be in writing signed by the
Landlord. No payment by the Tenant or receipt by the Landlord of a lesser amount
than the rent due under this lease shall be deemed to be other than on account
of the earliest stipulated rent or shall any endorsement or statement on any
check or on any letter or document accompanying any such check or payment be
deemed an accord and satisfaction, and the Landlord may accept such check or
payment without prejudice to the Landlord's rights to recover the balance of
such payment or to pursue any other remedy in this lease provided.






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14.  Entire Agreement-
This lease contains the entire agreement between the parties, and any executory
agreement hereafter made shall be ineffective to change, modify, discharge, or
affect an abandonment of it in whole or in part unless such executory agreement
is in writing and signed by the party against whom enforcement of the change,
modification, discharge or abandonment is sought.




15.  Notice- Whenever,
under the terms of this lease, notice is required to be given or a bill is
required to be sent by either party to the other, notice shall be deemed to be
given as of the date of mailing by certified or registered mail, return receipt
requested or as of the date of receipt of such mail by overnight
mail,




to the
Landlord at:


P.O. Box
8383


Manchester,
Connecticut 06040




with a
copy to:


Fatima T.
Lobo, Esq.


Lobo
& Associates, LLC Manchester, CT 06042-1975 Tel. (860) 645-0006


Fax.
(860) 645-1110




to the
Tenant at the address at the following address:


VeruTEK
Technologies, Inc. 65 West Dudley Town Road Bloomfield, CT 06002


with a
copy to:








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16.  Recording- The
Tenant agrees not to record this lease and in the event of such recording, this
lease shall be at the option of the Landlord void. Either party to this lease
may, upon notice from the other party, request that a notice of lease be filed
in accordance with the Connecticut Statutes relating to Notices of Lease, which
notice of lease may be recorded by Landlord or Tenant.




17.  Condemnation- If at
any time during the term of this lease the Premises shall be taken or
appropriated by virtue of eminent domain or similar proceedings or be condemned
by any public or quasi-public use which shall prevent normal occupancy and use
by the Tenant, the Tenant shall not share in the damages or awards paid in
respect to the taking or appropriation of its leasehold interest. If a
condemnation results in the taking of the whole or substantially whole Premises,
this Lease shall terminate as of the date of such taking. If less that the
entire Premises is taken and the portion remaining is not sufficient, in the
Tenant's reasonable discretion, for the conduct of its business thereon, or
materially reduces the amount of parking available at the Premises or adversely
affects street access to the Premises, then Tenant may terminate this Lease as
of the date of such taking by written notice to Landlord. If Tenant does not
terminate this Lease, then, Landlord shall use commercially reasonable efforts
to restore the Premises to the condition that existed prior to such taking and,
from and after the date of such taking, rent due under this Lease shall be
abated on a proportional basis in relation to the portion subject to such
taking.




18. Destruction of Premises- In case of the total destruction of the Premises by fire, the elements,
external violence or other casualty, then and thenceforth this lease shall cease
and come to an end at the option of either Landlord or Tenant by written notice
to the other delivered within thirty (30) days after the occurrence of such
casualty. If neither party elects to terminate this Lease, then Landlord shall
at its sole expense rebuild the Premises to substantially the same condition as
existed prior to such casualty. The Tenant's liability for rent during the
period of rebuilding shall cease. In the event the Landlord rebuilds the
Premises, then said rebuilding shall be substantially completed within 6 months
of the date of the casualty. In case the Premises shall be partially damaged by
fire, the elements, external violence or other casualty, the same shall be
repaired as speedily as practicable by the Landlord. Should such damage be so
extensive as to render the Premises untenantable, the Landlord may, by giving
notice to the Tenant within thirty (30) days of such damage, terminate this
lease. If the Landlord does not give such notice, then the Landlord shall repair
and/or rebuild said Premises as soon as is reasonably possible. In the event the
Premises are not substantially rebuilt or repaired within ninety (90) days of
such damage, then the Tenant may, by notice to the Landlord, terminate this
lease upon ten (10) days written notice of Landlord's failure to make said
repairs within the 90-day period. If the damage materially interferes with the
Tenant's use of the property, Tenant shall have an abatement or an apportionment
of the rent until the damage has been repaired or until this lease has been
terminated pursuant to the terms hereof. If the Premises are damaged such that
they are untenantable during the last six (6) months of this lease or during the
last six (6) months of the first renewal option, this lease shall terminate
unless within thirty (30) days of such damage, Tenant
exercises the option to renew this lease.








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19.  Quiet Enjoyment- The
Landlord covenants that so long as the Tenant is in possession, the Tenant shall
not be disturbed in the enjoyment of the Premises by the Landlord or by anyone
claiming by or under the Landlord.




20.  Right of Entry- The
Landlord, its agents, employees, prospective purchasers, prospective mortgagees
and prospective lessees, may from time to time enter the Premises during the
term of this lease at reasonable business hours and may further make such
repairs as they are required to make under the terms of this lease provided that
they do not unreasonably interfere with the Tenant's business. Lessor or his
agents may enter upon the Premises at other than reasonable business hours to
make emergency repairs, provided however, that whenever possible, Landlord shall
refrain from entering the Premises unaccompanied by a representative of Tenant.
In the case of an emergency, prior to entering the Premises, the Landlord shall
call one or more members (up to a maximum of four), of the Tenant's "Emergency
Response Team", the members of which shall be designated in a written notice
delivered to Landlord contemporaneously with execution of this Lease and updated
in writing by Tenant from time to time thereafter.




21.  Transfer by Landlord- The term "Landlord" as used in this lease means only the owner or the
mortgagee in possession for the time being of the land and building (or the
owner of a lease subject to this lease of the building or of the land and
building) which constitutes the Premises, so that in the event of any sale or
sales of said land and building, or in the event of a lease subject to this
lease of the building or of the land and building, the said Landlord shall be
and hereby is entirely freed and relieved of all covenants and obligations
hereunder, except obligations existing under claims then existing and accrued;
and it shall be deemed and construed without further agreement between the
parties and the purchaser at any such sale, or the said Tenant of the building
or of the land and building, that such purchaser or such Tenant of the building
of the land and building, has assumed and agreed to carry out any and all
covenants and obligations of Landlord hereunder. It is agreed that no such sale
or lease shall be made unless such purchaser or lessee expressly assumes and
agrees to carry out all of the covenants and obligations of the Landlord
hereunder.




22.  Responsibility for Repairs- Landlord will deliver the Premises with all structural, mechanical, air
conditioning as set forth Schedule 12 heating, electrical and plumbing systems
in good working order. Landlord hereby warrants toTenant that as of the
Commencement Date the Premises shall be in good order and condition and in
compliance with all applicable laws and regulations. The Landlord agrees that
during the term of the lease, the Landlord will at its sole cost and expense
make all necessary repairs to the exterior and to the structure of the building,
(including without limitation, the roof, subfloor and load bearing walls and
including periodic repaving and restriping of the parking lot and entrance
drives in order to maintain them in good appearance and condition consistent
with other first class office/industrial buildings in the area). Tenant shall be
responsible for all other repairs including but not limited to repairs and
maintenance of the heating, air conditioning, electrical and plumbing systems.
Tenant's obligations shall not include any major repairs that would be
considered capital improvements under Generally Accepted Accounting
Principles.






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23. Utilities-


The
Tenant agrees to be solely responsible for the following:


(a)  Telephone
services; and


(b)  Dumpster
and rubbish removal;




The
Landlord and Tenant agree that the gas and electricity shall not be separately
metered for Tenant and Visonic, Inc. (hereinafter, "Visonic"). The Tenant shall
pay such amount which is in excess of Visonic's use. Visonic's use shall be
established by taking the average kilowatt hours and units of gas for the prior
twelve (12) months. In the event that the Visonic lease terminates prior to the
Tenant's lease, Landlord shall be responsible for usage in excess of Tenant's
usage based on an average kilowatt hours and units of gas for the twelve (12)
months preceding the end of Visonic's lease. In the event that gas and/or
electricity become individually metered, then Tenant shall be responsible only
for its usage. In the event that a new tenant leases the Visonic location and
Tenant's usage based on kilowatt hours varies by ten per cent (10%) or more,
then the Landlord and Tenant shall equitably adjust the allocation hereof. In
the event that Tenant changes it use or intensifies its us of the Premises, then
the Landlord and Tenant shall equitably adjust the allocation
hereof.




All other
utilities which are not separately metered shall be paid by Tenant as set forth
in Paragraph 33.




24. Mechanic's Liens-
The Tenant shall not suffer or permit any mechanic's or materialman's lien to be
filed against the Premises or any part thereof by reason of work, labor,
services or materials performed or supplied on its order. If any such mechanic's
or materialman's liens shall be filed against the Premises, the Tenant shall
cause the same to be discharged of record within ninety (90) days of recording.
If Tenant cannot discharge such lien within such period then in addition to all
other rights and remedies of Landlord, the Landlord may discharge the same by
paying the amount claimed to be due without inquiry into the validity of such
claim. Such amount paid by the Landlord in procuring the discharge of such lien
and all reasonable expenses in connection with such discharge shall be paid as
additional rent by the Tenant to the Landlord within five (5) days of the date
of a bill therefore sent by the Landlord to the Tenant.




25.  Signs- The Tenant
may erect on the exterior of the Premises and/or on the land surrounding the
building such signs as the Tenant may desire providing such permission of the
Zoning authorities of the town in which the Premises are located be obtained by
Tenant for the erection of any such signs and that said signs be erected at
Tenant's sole cost and expense.




26.  Nonrecourse as to Landlord- Notwithstanding anything to the contrary set forth in this lease, it is
specifically understood and agreed by Tenant than there shall be no personal
liability on the part of the Landlord, with respect to any of the terms,
covenants and conditions of this lease (except liability under Paragraph 7 of
this Lease), and the Tenant shall look solely to the equity, if any, of the
Landlord in the Premises for the satisfaction of each and every remedy of the
Tenant in the event of any breach by the Landlord of any of the terms, covenants
and conditions of this lease to be performed by the Landlord, except under
Paragraph 7.




27. Security Deposit-
Landlord and Tenant agree to pay Four Thousand ($4,000) as a security deposit
shall be paid by Landlord.





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28.  Termination of Lease- Upon termination of this lease, for any reason, the Tenant shall
surrender the leased Premises to the Landlord. At that time, the Tenant shall
surrender the leased Premises to the Landlord in the same condition it was in at
the commencement of the term, reasonable wear and tear excepted. The premises
shall be "broom clean" upon surrender. Upon expiration of the lease, any option
term or extensions, Tenant will not be responsible for the removal of any
improvements it has made to the Premises if such improvements have been made
with the approval of the Landlord.




In the
event the Tenant continues in possession after the termination of this lease,
said continuation of possession shall not constitute a new term, but shall be a
month-to-month tenancy only with all of the other terms and conditions of the
lease binding upon the Tenant except that the rent or use and occupancy charge,
as the case may be, shall then be 150% of the then monthly rental
payment.




29.  Captions- The
captions used in this lease are inserted only as a matter of convenience and in
no way define, limit or describe the scope of the lease nor the paragraph in
front of which it appears.




30.  Force Majeure-
Neither Landlord nor Tenant shall be required to perform any term, condition or
covenant in this Lease so long as such performance is delayed or prevented by
force majeure, which shall mean acts of God, strikes, lockouts, material or
labor restriction by any governmental authority, civil riot, floors, financing,
and any other cause not reasonably within the control of such party, and which
by the exercise of due diligence Landlord is unable, wholly or in part, to
prevent or overcome.




31.  Binding Effect- This
lease shall be binding upon the Landlord and Tenant, and their respective
successors, and assigns.




32.  Invalidity of Particular
Provision- If any term or provision of this lease, or the application
thereof to any person or circumstance shall, to any extent, be invalid or
unenforceable, the remainder of this lease shall not be affected thereby and
each term and provision of this lease shall be valid and enforceable to the
fullest extent permitted by law.




33.  Additional Rent: Taxes,
Master Insurance and Maintenance Charges-As additional rent, Tenant
shall pay, on an annual basis, monthly in arrears (together with the base rent
as set forth in paragraph 4 herein) its proportionate share of all insurance
costs, real property taxes and Common Area Charges on the property in which the
Premises are located (all of which is collectively defined as the "Total Common
Areas Charges". The proportionate share of Total Common Area Charges shall be
determined by the use of a fraction, the numerator of which is the number of
square feet of floor space in the leased Premises and whose denominator is the
aggregate number of square feet of all floor space of the building within which
the Premises are located. Such fraction is 36.67%.




"Taxes",
as used herein, shall mean all taxes, duties, assessments, or sewer liens or
other charges relating to the Premises or the rental thereon, or any charge
levied in lieu of the foregoing taxes, duties, assessments, or sewer liens
levied or imposed against the land and buildings or rent paid thereon of which
the leased Premises form a part whether said sums are payable to the Town in
which the Premises are located or to any other governmental taxing authority
having jurisdiction
of the leased Premises.








11




Said
taxes and insurance shall be determined upon receipt of a bill by the Landlord
and shall be amortized monthly over the year following the receipt of said bill.
If said bill is received after the commencement of a lease year, the Tenant
shall make up any difference, within 30 days, between the amortized amount for
the next year and the then current tax installment for the prior
months.




During
the first lease year and until first day of the second month immediately
following the end of the Landlords fiscal year, the Tenant's monthly pro-rata
share of the Total Common Area Charges, as defined herein, shall be based
on:




a.
            the
      Total Common Area Charges incurred by the Landlord in the last full fiscal
      year prior to the commencement of the lease, multiplied
  by




b.
            36.67%,
      and further multiplied byc.
            one
      twelfth (1/12th).




Thereafter,
and commencing on the first day of the second month immediately following the
end of the Landlords fiscal year, the Tenant's pro-rata share of Total Common
Area Charges, shall be recomputed based on the Total Common Area Charges
incurred by the Landlord in the immediate preceding fiscal year. Tenant shall
pay Landlord one twelfth (1/12th) of the
Tenant's 36.67% proportionate share of the amount so determined, rounded to the
nearest dollar, on the first day of each calendar month during such Lease Year.
Landlord's and Tenant's obligations hereunder shall survive the expiration of
this Lease. Said adjustments shall be made on or about January 1 of each
year.




Within
ninety (90) days after the end of each fiscal year, Landlord shall furnish
Tenant a statement in reasonable detail of the actual Common Area Charges for
such fiscal year prepared in accordance with sound accounting practices by
Landlord's accountant. If the Tenant does not object, in writing by certified
mail, return receipt requested, to said accountant's determination of its share
of the common charges, said charges be deemed accepted by the Tenant. If the
Tenants so objects, any dispute shall be settled within 60 days by binding
arbitration by an arbitrator selected by the Tenant from a list of three
independent accountants selected by the Landlord. Pending said arbitration the
Tenant shall continue to pay said additional rent, subject to adjustment by the
arbitrators.




As
provided herein, Tenant shall pay, on a monthly basis, (together with the base
rent as set forth in paragraph 4 herein) Tenant's share of the Maintenance
Charges. For the purposes of this Lease, the term Maintenance Charges shall mean
all out-of-pocket amounts actually paid or incurred by Landlord or its designee
which are reasonable and customary for properties similar to the Premises to
perform Landlord's obligations under Paragraphs 23(a) and (b) of this
Lease.




For the
purposes of this Lease, the term Common Area Charges shall mean all amounts paid
or incurred by Landlord or its designee to operate, maintain and repair the
Common Areas (and any common improvements therein, thereon or thereunder),
including but not limited to, water, sewer charges, cleaning, snow and ice
removal, lighting, maintaining and repairing exterior of the building;
landscaping; water and sewerage charges related to the Common Areas; premiums
for liability, fire (including all extended coverages and endorsements) and
workmen's compensation insurance related to the Common Areas, sales and use
taxes on material, equipment, supplies and services purchased to operate and
maintain the Common Areas; fees for required licenses and permits, supplies,
policing, security and traffic control of the Common Areas and
affording protection thereto against fire to the extent that such fire
protection is furnished by Landlord; annual costs relating to the sprinkler
system, e.g., stand-by water charge and alarm system, repair and maintenance of
the common areas.






12




Landlord
shall not charge Tenant, at any time during the lease or option periods, for any
improvements to the building common areas necessary to make the property adhere
to current ADEA regulations and specifications.




To the
best of Landlord's actual knowledge, the Premises are in compliance with all
environmental laws, regulations, orders, etc.




Common
Area Charges shall not include any major repairs that would be considered
capital improvements under Generally Accepted Accounting
Principles.




34.  Option to Renew- The
Tenant shall have the option to renew this lease for one term of five (5) years,
upon the same terms and conditions as provided herein, except that the base rent
shall be adjusted upwards only as provided herein.




Said
option shall be exercised by Tenant giving notice in writing, pursuant to this
agreement, to Landlord at least six (6) months before the expiration of the
initial term. It shall be a condition of the exercise of the foregoing option
that at the time of the exercise of said option, Tenant shall not be in default
under any of the terms of this lease.


Commencing
with the rent due August 1, 2009 and each August 1stthereafter, the monthly payments of rent shall be adjusted by any
increase in the Index (as defined herein). Such increase shall be determined by
multiplying the base rent of $3,166.67 as set forth in Paragraph 4 herein by a
fraction, the numerator of which is the last Index published for the month
immediately preceding the anniversary date of this Lease (i.e. July), and any
renewal thereof, and the denominator of which is the last Index published for
the month prior to the initial term of the Lease as set forth in Paragraph 3. In
the event that, in any year, said fraction indicates a negative adjustment,
there shall be no decrease in the monthly rent.




As used
herein, "Index" means the Consumer Price Index for All Urban Consumers
(1982-84=100) as promulgated by the Bureau of Labor Statistics of the United
States Department of Labor (currently found at www.bls.gov); or, if
that Consumer Price Index ceases to be published, any successor similar
publication (using any appropriate conversion factor therein provided) or if
there is no such successor, then any comparable index selected by the Landlord
that is in general use as a mechanism for measuring changes in purchasing
power.




35.  Consent- If any
provision of this lease requires the consent of the Landlord or the Tenant, such
consent shall not be unreasonably withheld.





13




IN
WITNESS WHEREOF, the parties have set their hands and seals the day and year
first above written.






Signed,
      Sealed and Delivered in the Presence of
            
            LANDLORD,ByWales Realty,
      LLCRoger
      W. Talbot, Sr, MemberTENANTVeruTEK
      Technologies, Inc.By John
      CollinsIts President and
      CEO








14






EXHIBIT
A













15






EXHIBIT
A















16






Schedule
12


Improvements subject to
$90,000 Landlord contribution per paragraph 12 (c)




Heating
      and Air Conditioning Replace 3
units




Electrical


As
necessary to support separation from other Tennant Disconect fire and burglar
system - Visonic responsibility Install exit signs and lighting as
required




Stairways


Requires
a second staircase to be added.




Walls


Add a
wall to divide warehouse area


First and
second floor separation partitions




Restrooms


Add
handicapped compliant restroom on first floor.




Other


Paint,
prime and repair 1stand 2nd floor officces as necessary


Repair
all doors to ensure they close properly / weather stip if necessary Replace
existing fl000ring and install new as necessary


Replace
damaged or mismatched ceiling tiles as necessary









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