Document:

Lease - Lab 1

    Exhibit
      10.13

                                                                               

    
      
        	
                 

              	 	
                 

              

      

       

      CLIENT
        LEASE

      [20%
        RENT SUBSIDY]

       

        
          

        

      

       

      THIS
        LEASE, is made and entered into this 1st
        Day
        of
        August, 2006, by and between FLAGSHIP ENTERPRISE CENTER, INC., an Indiana
        not-for-profit corporation Altairnano Technologies, Inc., a Nevada Corporation,
        and Tenant an Indiana Limited Liability Corporation (hereinafter called
        "Tenant").

       

      Witnesseth
        That:

       

      Article
        I.

      Leased
        Premises. 

       

      Section
        1.01. Lease
        and Description of Premises. Landlord,
        for and in consideration of the rent, covenants, agreements and conditions
        stated herein, does hereby lease to Tenant and Tenant does hereby lease from
        Landlord the following described premises (hereinafter referred to as the
        "Leased Premises") situated in the Flagship
        Enterprise Center Building located at 2701 Enterprise Drive, Flagship Business
        Park,
        Anderson, Indiana 46013 (hereinafter referred to as "Building") and including
        all that
        certain space, which is on the second floor of the Flagship Enterprise Center
        Building
        which is designated Lab #1 consisting of 1200 square feet of space as shown
        in
        Exhibit "A." Because of the special nature of Landlord's building, Landlord
        has
        the option,
        in its sole discretion, to require Tenant to move to comparable space in
        the
        Building during the term of this Lease.

       

      Section
        1.02. Additional
        Consideration to Tenant/Use of Equipment and Shared Services. As
        additional consideration of Tenant's payment of rent as herein below provided,
        Landlord shall provide Tenant with the following equipment and/or
        services:

       

      
        
          
          

        

        
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                  (a)

                	
                   

                  Central
                    Office Services. Landlord
                    shall provide a staffed reception area, access to common areas,
                    including
                    scheduled access to conference rooms; access to shared restrooms,
                    exercise
                    room and kitchen facilities; a centralized mail area, including
                    a mailbox
                    for Tenant; access to centralized
                    copying and faxing facilities and equipment; Landlord's standard
                    centralized computer systems and services, including internet
access;
                    and security and janitorial services. Tenant is responsible for
                    the
                    cost
                    of any additional office services required by Tenant. Optional
                    services
                    includes
                    a $20.00 fee per data jack used to access broadband and $2.50
per
                    month fee over 36 months for access to VOIP Power over Ethernet.
                    In
                    the
                    event that Tenant desires to replace or upgrade Landlord's standard
                    computer systems or services, Tenant must obtain Landlord's prior
                    written
                    approval.
                    Tenant shall pay all costs and fees incurred in connection with
                    any
                    replacement or upgrade of Landlord's standard computer systems
                    or
                    services.

                

        

      

      
        
          	
                   

                  (b)

                	
                   

                  Telephone
                    Infrastructure Services. The
                    Landlord will assist in arranging Tenant
                    with local calling area telephone service, telecommunication
                    lines
                    and
                    telephone and computer network jacks. Tenant is responsible for
                    the
                    cost
                    of these lines and any other expenses associated with its telephone
                    service
                    and equipment, including but not limited to charges associated
                    with
                    the installation of additional telephone lines, additional bandwidth
                    requirements,
                    long distance charges, and all other expenses. In the event that
                    Tenant desires to replace or upgrade telephone equipment or service,
                    Tenant
                    must obtain Landlord's prior written approval. Tenant shall pay
                    all
                    costs
                    and fees incurred in connection with such replacement or upgrade.
                    Landlord
                    shall provide Tenant with monthly invoices reflecting any such
                    additional
                    telephone systems and services charges and Tenant shall pay Landlord
                    for such charges within fifteen (15) days of receipt of each
invoice.

                
	
                   

                  (c)

                	
                   

                  Parking.
                    Landlord
                    shall provide Tenant with access to parking facilities, which
                    shall be
                    subject to availability and Landlord's parking facilities policies.
                    Handicapped parking is made available for those tenant/visitors
                    with
                    a handicap parking pass only, all others may be towed or
                    ticketed.

                

        

      

       

      Section
        1.03. Examination
        and Inspection of Leased Premises/Renovation Expenses.
        Tenant
        acknowledges that it has had the opportunity to examine and inspect and
        has
        examined and inspected the Leased Premises. Tenant accepts the Leased Premises
        in their current "as is" condition, subject to the responsibility of the
        Landlord to effect repairs and maintenance as below provided.

       

      As
        per
        the negotiations heretofore completed between the parties, Landlord, prior
        to
        the inception of this Lease, has renovated and improved the Leased Premises.
        As
        to such
        renovations and improvements, Landlord has paid or will pay the total cost
        of
        such renovations and improvements.

      
        
          
          

        

        
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      Article
        II. 

      Lease
        Term.

       

      Section
        2.01. Initial
        Lease Term. Unless
        sooner terminated under the provisions hereof,
        the term of this Lease shall be for a period of three (3) years (the "Initial
        Term"), commencing on the 1st
        day
        of
        August, 2006 (hereinafter referred to as the "Commencement Date") and ending
        on
        the 31st,
        day of
        July, 2009.

       

      Section
        2.02. Lease
        Renewal. This
        Lease may be renewed for subsequent terms
        of
        one (1) year (each a "Renewal Term") on such terms as are mutually agreed
        to
by
        the
        parties. Provided, however, the rent to be charged by Landlord during certain
        specified
        Renewal Terms shall be no greater than as set forth in paragraph 3.02 below.
        The
        term of this Lease, including the Initial Term and any Renewal Term(s), is
        referred to
        in
        this Lease as the "Term."

       

      Section
        2.03. Provisions
        for Negotiation of Renewal. The
        parties shall commence
        negotiations for a Renewal Term no sooner than ninety (90) days before the
        expiration
        of the existing Term and such negotiations shall be completed no later than
        thirty
        (30) days before the expiration of the existing Term.

       

      Section
        2.04. Holding
        Over. In
        the
        event Tenant remains in possession of the Leased
        Premises after the expiration of the Initial Term and/or expiration of a
        renewal
term,
        without the execution of a lease extension agreement or exercise of a renewal
        option,
        Tenant shall be deemed to be occupying the Leased Premises as a tenant from
        month to month and all terms of the Lease shall continue unabated, excepting
        for
        the length
        of
        term as herein specified. Such month to month tenancy may at any time be
        terminated by either party upon thirty (30) days written notice given to
        the
        other party.

       

      Article
        III. 

      Rental
        Payments.

       

      Section
        3.01. Subsidized
        Rent. Based
        upon negotiations between the parties, Tenant
        shall pay, as rent, to Landlord, a sum equal to eighty percent (80%) of the
        stipulated
        fair market rent of the Leased Premises as set forth in Exhibit "B" ("Subsidized
        Rent"). Such Subsidized Rent shall be increased from each successive
annual
        anniversary date of the lease as shown in Exhibit "B.

       

      Section
        3.02. Rent
        During Renewal Terms. The
        rental payments for any Renewal
        Term shall be in the monetary sum mutually agreed to by the parties prior
        to
the
        commencement of the Renewal Term. It is understood, however, that should
        the
parties
        agree to extend the Lease Agreement by one (1) or more Renewal Terms, the
        rent
        shall be fixed for specified Renewal Terms in amounts no greater than the
        sums
        recited in the Rent Schedule, attached hereto as Exhibit "B."

      
        
          
          

        

        
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      Section
        3.03. Obligation
        of Tenant to Relocate in Madison County, Indiana/Provision
        for Reimbursement of Subsidy to Landlord. Tenant
        agrees that, following termination or expiration of this Lease for any reason
        (other than any termination by Landlord during the Initial Term without cause),
        Tenant shall maintain its principal
        place of business and operations in the State of Indiana for a period of
        time at
least
        equal to the length of time that Tenant leases space within the Flagship
        Enterprise Center (the "Subsidized Term"). If, after termination or expiration
        of this Lease, Tenant relocates its principal place of business and operations
        outside of Madison County, Indiana prior to expiration of the Subsidized
        Term,
        then Tenant shall pay to Landlord an amount
        equal to the difference between (i) the fair market rent for leasing Tenant
        Space during Tenant's tenancy at the Flagship Enterprise Center and (ii)
        the
        total amount of rent
        paid
        by Tenant to Landlord during such tenancy. The "fair market rent" shall be
        the
stipulated
        fair market rental as set forth in Exhibit "B". The exception to this clause
        shall occur
        with a change in the ownership of a majority of a tenant's stock; if a majority
        interest is acquired by another entity, and that entity requires the relocation
        of the company outside of Madison County, Indiana, then this clause shall
        not
        apply to the tenant.

       

      Section
        3.04. Landlord's
        Payment of Utilities. Landlord
        shall pay all usage and other
        monthly charges for all utility services rendered or furnished to or based
        upon
        or in connection with the Leased Premises, including, but not limited to,
        electricity, gas, water/sewage,
        or other utility or service. Provided, however, should Tenant's use of the
        Leased
        Premises cause an unreasonable or unexpected use of any utility or utility
        service, Landlord reserves the right, after written notice to Tenant, to
        charge
        such excessive utility use and the charges therefore to Tenant.

       

      Section
        3.05. Payment
        of Taxes on Real Estate and Personal Property. Landlord
        covenants and agrees to assume and pay all real estate taxes, if any, incurred
        and/or assessed against the real estate and improvements located on the Leased
        Premises.
        Tenant covenants and agrees to assume and pay all personal property taxes
        incurred and/or assessed against the personal property owned by Tenant located
        on
        the
        Leased Premises.

       

      Section
        3.06. Past
        Due Payments. In
        the
        event any rental payment or other payment
        owing from Tenant to Landlord pursuant to this Lease shall become overdue
        for a
        period in excess of ten (10) days, a late charge in the amount of five percent
        (5%) of such overdue payment shall be paid by Tenant to Landlord, which late
        charge shall be payable upon demand. Said late charge shall be in addition
        to
        and not in lieu of any other
        remedy Landlord may have and any fee, charge, payment and advancements
landlord
        may be entitled to hereunder or by law. In the event any rental payment or
        other
        payment owing from Tenant to Landlord pursuant to this Lease shall become
        overdue for a period in excess of twenty-five (25) days, such unpaid amounts
        shall bear interest from the due date thereof to the date of payment at the
        rate
        of one and one-half percent (1 1/2%) per
        month.

      
        
          
          

        

        
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      Section
        3.07. Place
        of Payments. All
        payments required to be paid, and all statements required to be rendered
        by
        Tenant to Landlord shall be delivered to Landlord at its address
        set forth in Section 15.01 hereof or to such other address as Landlord specifies
        to
        tenant
        in accordance with such Section.

       

      Article
        IV. 

      Use
        and Occupancy. 

       

      Section
        4.01. Use
        of
        Leased Premises. The
        Leased Premises in the office area shall
        be
        used solely as office or laboratory research space. The Leased Premises in
        the
        manufacturing area shall be used as manufacturing, research or lab space.
        Landlord
        may relocate Tenant to comparable space within the Building at Landlord's
        sole
        discretion. Tenant will have full access to and use of Tenant Space, and
        the
        right to
        use
        and access all common areas within the Building on an "as available" basis,
        subject
        to the Flagship Enterprise Center's Building Rules and Regulations, as
amended
        or modified from time to time, which are incorporated by reference into this
        Lease. Tenant hereby acknowledges receipt of the current Building Rules and
        Regulations. Landlord shall provide to Tenant written notice of any amendments
        or modifications to the Building Rules and Regulations, which shall be effective
        with respect
        to Tenant after such notice has been given. Tenant will not have access to
        any
other
        areas within the Building, including but not limited to the space of other
        tenants and
        Landlord's executive offices.

       

      Section
        4.02. Prohibition
        Against Waste and Unlawful Uses. Tenant
        shall not commit or allow any waste or damage to be committed on any portion
        of
        the Leased Premises.
        Tenant shall not occupy or use or permit any portion of the Leased Premises
        to
        be
        occupied or used for any business or purpose which is unlawful, disreputable
        or
        deemed to be hazardous, or permit anything to be done which would in any
        way
        significantly increase the cost of insurance coverage on the Leased Premises
        or
        its contents.

       

      Section
        4.03. Prohibition
        Against Use or Storage of Hazardous Materials. Tenant
        shall not maintain, store or use any other hazardous materials upon the Leased
        Premises without Landlord's written consent. Hazardous materials shall mean
        any
hazardous,
        toxic or radioactive substance, matter, material or waste which is or
becomes
        regulated by any federal, state or local law, ordinance, order, rule,
        regulations, code
        or
        other governmental restriction or requirement and includes, without limitation,
        asbestos,
        petroleum products and the terms hazardous substance and hazardous waste
        as
        defined in CERCLA and RCRA, as each may be amended. If any hazardous materials
        are necessary for the carrying on of tenant's business operations, notice
        of
        existence of such materials must be given to Landlord, and Tenant shall retain
        such licenses as may be required to handle, transport and dispose of such
        materials in accordance with local, state and federal rules, regulations
        and
        laws.

       

      Section
        4.04. Environmental
        Responsibility. Tenant
        must supply Landlord Material
        Safety Data Sheets for all chemicals used by Tenant. Tenant must comply with
        the
        OSHA
        and EPA requirements. Noise levels created by Tenant's machinery must
not
        exceed a limit of 85 decibels or such noise level required by the applicable
        zoning ordinance,
        whichever is lower. Tenant shall defend and hold Landlord harmless from all
        fines,
        penalties and costs relating to any violation or noncompliance with such
        laws
        and regulations.

      
        
          
          

        

        
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      Section
        4.05. Prohibition
        Against Excessive Floor Loads.Tenant
        shall not overload the floors of the Tenant Space beyond their designed
        weight-bearing capacity. Landlord reserves the right to direct the positioning
        of all heavy equipment, furniture and fixtures that Tenant desires to place
        in
        the Tenant Space so as to distribute weight properly. Landlord may require
        the
        removal of any equipment, furniture or fixtures that exceeds appropriate
        weight
        limits for the Tenant Space.

       

      Section
        4.06. Condition,
        Alterations and Additions.Tenant's
        acceptance of the Leased Premises on the Commencement Date shall be as is,
        where
        is and without warranty of any kind as to zoning, condition, fitness for
        Tenant's business purpose or otherwise.
        Tenant assumes sole responsibility for examining the Leased Premises prior
        to
        the
        Commencement Date to assure itself of the Leased Premises' compliance with
        this
        Lease and Tenant's business purpose. Tenant
        shall make no leasehold improvements,
        alterations or additions to any part of the Leased Premises
without
        the prior written consent of Landlord. All
        such
        improvements, alterations and
        additions, excepting only unattached and movable trade fixtures, shall be
        the
        sole property of Landlord.

       

      Section
        4.07. Signage.All
        signage, whether installed inside the structure on the Leased Premises or
        on the
        exterior thereof, shall be subject to the written approval of
        Landlord.

       

      Article
        V. 

      Maintenance
        and Repairs.

       

      Section
        5.01. Maintenance
        by Landlord. Landlord,
        at Landlord's expense, shall keep
        the
        foundation, walls and other structural parts, including the roof, of the
        building in reasonable order, condition and repair; provided, however, Landlord
        shall not be responsible
        for making any repairs or replacements occasioned by any act or negligence
        of Tenant, its employees, contractors, agents, invitees, licensees or
        concessionaires. Landlord shall also keep, maintain, replace and repair the
        Leased Premises and every part thereof in good order, condition and repair,
        including, but not limited to, interior and exterior electrical, mechanical
        and
        utility equipment and systems; fixtures; and interior walls, floors and
        ceilings.

       

      Section
        5.02. Payment
        of Cleaning & Janitorial Service Expenses.Tenant
        shall assume
        and pay ail expenses for routine/customary cleaning and janitorial services
        to
keep
        the
        Leased Premises in a clean and orderly condition. Should Tenant fail in this
        responsibility, Landlord reserves the right, but shall not be obligated,
        to
        cause the Leased Premises to be cleaned and charges therefore would be assessed
        to Tenant. Landlord
        shall assume and pay all expenses for routine/customary cleaning and
janitorial
        services to keep the Common Areas within the Building in a clean and orderly
        condition. Tenants are responsible for picking up after themselves in the
        kitchen area.

      
        
          
          

        

        
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      Section
        5.03. Landlord's
        Provision of Snow Removal and Lawn Care. As
        additional consideration for Tenant's payment of Monthly Rental Payments,
        Landlord, during the Initial Term and any Renewal Term, shall provide snow
        removal for Tenant's parking
        and walkways and shall further provide lawn care and landscaping services
        to
the
        area
        surrounding the Leased Premises.

       

      Section
        5.04. Notice.
        Tenant
        shall give Landlord prompt written notice of the need
        for
        any maintenance, replacement or repairs which Landlord is obligated to make
        under
        foregoing Section 5.01 and of any material damage to the Leased Premises
        or
any
        part
        thereof.

       

      Section
        5.05. Access
        to Leased Premises. Landlord
        and its agents may retain a pass
        key
        to the Leased Premises and shall have the right to enter the Leased Premises
        at any
        and
        all times to service and inspect the Leased Premises. During the period
        beginning sixty (60) days prior to the expiration of the Initial Term or
        any
        Renewal Term (unless
        Landlord has already agreed to extend the Term of this Lease), Landlord's
        staff
may
        enter
        the Leased Premises to show the Leased Premises to prospective
        tenants.

       

      Article
        VI. 

      Insurance
        and Indemnification. 

       

      Section
        6.01. Public
        Liability Insurance: Tenant.Tenant,
        at Tenant's expense, shall
        maintain in full force and effect throughout the Lease Term a policy of general
        public
        liability insurance naming Landlord as an additional insured and covering
        any
        and all
        claims for injuries to or death of persons and damage to property occurring
        in
        or upon
        the
        Leased Premises, in an amount not less than One Million Dollars ($1,000,000.00)
        for injury to or death of any one person; Two Million Dollars ($2,000,000.00)
        for injury to or death of more than one person in the same accident or
        occurrence; and Five Hundred Thousand Dollars ($500,000.00) for damaged property
        arising out of any one accident or occurrence.

       

      Section
        6.02. Insurance
        on Tenant's Property.All
        of
        Tenant's fixtures, equipment,
        merchandise or other personal property shall be kept at Tenant's sole risk
        and
        expense, and Tenant, at Tenant's expense, shall maintain in full force and
        effect throughout the Lease Term fire and extended coverage insurance on
        its
        fixtures, equipment,
        merchandise and other personal property in or upon the Leased Premises
for
        its
        full insurable value on a replacement cost basis, if obtainable, and if not
        obtainable, for the full amount of the estimated cash value for such
        property.

       

      Section
        6.03. Insurance
        on Leased Premises.Landlord
        shall maintain in full force
        and
        effect throughout the Lease Term broad form fire and extended coverage insurance
        on the Leased Premises and Landlord's fixtures, equipment and personal property,
        in, on or about the Leased Premises, for their full insurable value on a
        replacement cost basis, if obtainable, and if not obtainable, for the full
        amount of its actual cash value.

      
        
          
          

        

        
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      Section
        6.04. Waiver
        of Subrogation.Each
        of
        the parties hereto hereby waivers and
        releases any and all rights of recovery which it might have against the other
        for any loss
        or
        damage, whether or not caused by any alleged negligence of the other party,
        its
        agents, licensees or invitees, to the extent that such loss or damage is
        or
        would be covered by any insurance required to be maintained under this Lease.
        Each policy of insurance
        required under this Lease shall contain an endorsement to such effect, so
        long
        as
        such endorsement is available. Should either Landlord or Tenant be unable
        to
procure
        such an endorsement, the other party shall be relieved of carrying insurance
        with
        such
        an endorsement and the foregoing provisions for waiver of right of recovery
        against the other (right of subrogation) shall be of no further force or
        effect.

       

      Section
        6.05. Tenant's
        Indemnification.Unless
        caused or contributed to by the gross
        negligence or willful misconduct of Landlord, its agents or employees, Tenant
        assumes all risks and responsibilities for accidents, injuries or damages
        to
        person or property and agrees to indemnify and hold Landlord harmless from
        any
        and all claims, liabilities, losses, costs and expenses (including attorneys'
        fees) arising from or in connection with its, use or control of the Leased
        Premises and any improvements thereon during the Lease Term or Tenant's breach
        of any term, covenant, condition or agreement to be observed by Tenant under
        this Lease. Tenant shall be liable to Landlord for any damages caused by
        gross
        negligence or willful misconduct to the Leased Premises and for gross negligence
        or willful misconduct done by Tenant or any person
        coming on the Leased Premises by the license or invitation of Tenant, express
        or
        implied (except Landlord, its agents or employees).

       

      Section
        6.06. Tenant's
        Waiver of Claims.Landlord
        shall not be liable for, and Tenant waives all claims against Landlord for,
        any
        injuries, damages (including, but not limited to, consequential damages)
        or
        losses of or to person, property or otherwise, sustained by Tenant and not
        covered by insurance, unless resulting from Landlord's gross
        negligence or willful misconduct. All property of Tenant kept or stored in,
        upon
        or about
        the
        Leased Premises shall be so kept or stored at the sole risk of Tenant; and
        Tenant shall hold Landlord harmless from any claims, costs or expenses,
        including attorneys' fees, arising out of damage thereto, unless such claim
        arises out of grossly negligent or willful misconduct on the part of Landlord,
        its agents and employees.

       

      Section
        6.07. Certificates
        of Insurance.For
        each
        type of insurance which Landlord
        or Tenant are required to maintain under this Lease, each shall furnish the
        other
        an
        endorsed copy of such insurance policy showing that each such type of insurance
        is in full force and effect and not cancelable without thirty (30) days prior
        written notice to the other party.

      
        
          
          

        

        
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      Article
        VII. 

      Eminent
        Domain.

       

      Section
        7.01. Legal
        Effect.If
        the
        whole or any part of the Leased Premises is taken
        for
        public or quasi-public use by a governmental or other authority having the
        power
        of eminent domain, or shall be conveyed to any such authority in lieu of
        such
        taking, and if such taking or conveyance shall cause the remaining part of
        the
        Leased Premises to be untenantable and inadequate for Tenant's Business,
        then
        Landlord or Tenant may, at their option, terminate this Lease as of the date
        Tenant is required to surrender possession of the Leased Premises by giving
        the
        other party notice of such termination. If a part of the Leased Premises
        shall
        be taken or conveyed, but the remaining part is tenantable and adequate for
        Tenant's Business (as reasonably determined by Tenant, and with notice of
        such
        determination given to Landlord within fifteen
        (15) days of any such taking), then this Lease shall be terminated as to
        the
        part taken
        or
        conveyed as of the date Tenant surrenders possession thereof; Landlord shall
        make
        such
        repairs, alterations and improvements as may be necessary to render the
part
        not
        taken or conveyed tenantable; and the rent shall be reduced in proportion
        to the
part
        of
        the Leased Premises so taken or conveyed.

       

      Section
        7.02. Payment
        of Award.All
        compensation awarded for such taking or conveyance
        shall be the sole property of Landlord, without any deduction therefrom for
        any
        present or future estate of Tenant, and Tenant hereby assigns to Landlord
        all
        its right,
        title and interest in and to any such award; provided, however, Tenant shall
        have the
        right
        to recover from such taking authority, but not from Landlord, such compensation
        as may be awarded to Tenant on account of moving and relocation expenses
        and
        depreciation to and removal of Tenant's property.

       

      Article
        VIII. 

      Destruction
        and Damage.

       

      Section
        8.01. Damage
        by Casualty.In
        the
        event of a fire or other casualty in the Leased Premises, Tenant shall give
        prompt notice thereof to Landlord. If the Leased Premises
        shall be partially destroyed by fire or other casualty so as to render the
        Leased
        Premises partially or wholly untenantable, the Rent shall be abated on the
        basis
of
        leasable square footage remaining and occupied thereafter, until such time
        as
        the Leased Premises are made fully fit for use by Tenant; provided, however,
        that if gross negligence
        or willful misconduct of Tenant, or its agents, employees or invitees shall
        have
        contributed to the cause of such fire or other casualty, the Rental shall
        not be
        abated during the period of restoration of the Leased Premises.

       

      Section
        8.02. Restoration;
        Partial or Total Destruction of Building.In
        the
        event the
        Building shall be partially or totally destroyed by fire or other casualty,
        the
        same shall
        be
        repaired as soon as is reasonably possible, at the expense of Landlord, unless
        Landlord shall elect to terminate this Lease as hereinafter provided. If
        damage
        to the Leased Premises is to such extent that the cost of restoration, as
        estimated by Landlord will
        exceed fifty percent (50%) of the replacement value of the Leased Premises
        (including
        the building standard improvements) or thirty percent (30%) of the replacement
        value of the Building (exclusive of the foundation) in its condition just
        prior
to
        the
        occurrence of the damage, Landlord may, no later than the sixtieth
        (60th)
        day
following
        such damage, give Tenant notice that it elects to terminate this Lease. if
        such
notice
        shall be given:

      
        
          
          

        

        
          Page
            9 of
            19

          
            

          

        

        
          
          

        

      

       

      
        	
                 

                (a)

              	
                 

                This
                  Lease shall terminate on the twentieth (20th
                  )
                  day following the giving of
                  said notice;

              
	
                 

                (b)

              	
                 

                Tenant
                  shall surrender possession of the Leased Premises on or before
                  such
                  termination date; and

              
	
                 

                (c)

              	
                 

                The
                  rental provided hereunder shall be apportioned as of the date of
                  such
                  termination and any Rental paid for any period beyond said date
                  shall be
                  refunded to Tenant.

              

      

       

      Unless
        Landlord so elects to terminate this Lease, Landlord shall proceed with the
        restoration
        of the Leased Premises and/or the Building as soon as reasonably possible.
        If
        the
        damage to the Building as the result of any casualty is such that the Leased
        Premises
        cannot be used by Tenant for Tenant's Business for a period of three (3)
        or
more
        months, as estimated by Landlord, either Landlord or Tenant may cancel and
        terminate
        this Lease by giving notice of such termination to the other party within
        thirty
        (30) days after the date of such casualty. In such event of termination,
        all
        Rental shall be
        apportioned as of the date of such termination and any Rental paid for any
        period beyond
        said date shall be refunded to Tenant. In no event, however, shall Tenant
        have
the
        right
        to cancel or terminate this Lease if the gross misconduct or willful neglect
        of
        Tenant, or its agents, employees or invitees shall have contributed to the
        cause
        of such casualty.

       

      Article
        IX. 

      Events
        of Default and Remedies.

       

      Section
        9.01. Events
        of Default.The
        occurrence of any one (1) or more of the following events shall be deemed
        to be
        an "Event of Default":

      
        	
                 

                (a)

              	
                 

                The
                  failure of Tenant to pay any installment of rent within thirty
                  (30) days
                  after its due date;

              
	
                 

                (b)

              	
                 

                The
                  failure of Tenant to perform any other of its covenants under this
                  Lease
                  or to comply with the Building Rules and Regulations within thirty
                  (30)
                  days after
                  written notice or demand therefore is served upon Tenant by
                  Landlord;

              
	
                 

                (c)

              	
                 

                The
                  making by Tenants of an assignment for the benefit of
                  creditors;

              

      

       

      
        
          
          

        

        
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            10
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                (d)

              	
                 

                The
                  levying of a writ of execution or attachment on or against the
                  Leased
                  Premises or Tenant's interest therein as the property of Tenant,
                  and the
                  same not being released or discharged within sixty (60) days
                  thereafter;

              
	
                 

                (e)

              	
                 

                The
                  institution of proceedings in a court of competent jurisdiction
                  for the
                  reorganization,
                  liquidation, voluntary or involuntary dissolution of Tenant, or
                  for
                  its adjudication as a bankrupt or insolvent, or for the appointment
                  of a
                  receiver of the property of Tenant, and said proceedings are not
                  dismissed
                  within sixty (60) days after the institution of said proceedings;
                  or

              
	
                 

                (f)

              	
                 

                A
                  mechanic's lien or similar lien upon the Leased Premises or the
                  building
                  is
                  asserted of record in connection with work allegedly done in or
                  about the
                  Leased Premises at the request or instance of Tenant, and the same
                  is not
                  removed by Tenant, or adequate security for the satisfaction thereof
                  deposited
                  with Landlord, within forty-five (45) days from the date any such
                  lien
                  was filed in the office of the Recorder of Madison County,
                  Indiana.

              

      

       

      Section
        9.02 Remedies.
        Upon
        the
        occurrence of an Event of Default, Landlord shall
        have the option to:

      
        	
                 

                (a)

              	
                 

                Re-enter
                  the Leased Premises with or without process of law, using such
                  means as
                  may be necessary to remove all persons and property therefrom;
                  and/or

              
	
                 

                (b)

              	
                 

                Exercise
                  any other right or remedy available to Landlord at law or in equity
                  in
                  addition to or as an alternative to any of the other rights and
                  remedies
                  of Landlord herein specified upon the occasion of any such Event
                  of
                  Default.

              

      

       

      In
        the
        event that subsequent to an Event of Default, Landlord should reset the Leased
        Premises
        or a portion thereof during the balance of the Term of this Lease, the
proceeds
        of such reletting, after deduction of all reasonable costs incurred by Landlord
        in
        connection with repossession and reletting of the Leased Premises (including
        without limitation,
        all legal fees, leasing commissions, remodeling costs and similar expenses)
        shall
        be
        applied to satisfaction of Tenant's obligations hereunder. Landlord shall
        have
the
        right
        to file suit to recover any sums which have fallen due under this Lease from
        time
        to
        time on one (1) or more occasions without being obligated to wait until the
        expiration of the Term of this Lease. Alternatively, in the event Landlord
        should elect to terminate this Lease, Landlord shall be entitled to recover
        forthwith as damages from Tenant a sum of money equal to: (i) the cost of
        recovering possession of the Leased Premises,
        (ii) the unpaid Rent owed at the time of such termination; (iii) the balance
        of
the
        Rent
        for the remainder of the term; and (iv) any other sum of money or damages
        owed
        by
        Tenant to Landlord, less the fair market rental value of the Leased Premises
        for
        the
        remainder of the term of this Lease.

      
        
          
          

        

        
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            11
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      Article
        X. 

      Subordination.

       

      Section
        10.01. Subordination.Upon
        request by Landlord, this Lease shall become subordinate to the lien of a
        mortgage given by Landlord, if such mortgage provides
        that Tenant's rights under this Lease and possession of the Leased Premises
        shall
        not
        be disturbed as long as it performs its duties hereunder. Tenant shall enter
        into
        any
        confirming subordination and non-disturbance agreement such mortgagee may
        reasonably require.

       

      Article
        Xl. 

      Assignment
        and Subletting.

       

      Section
        11.01. Assignment
        and Subletting.Tenant
        shall not assign or encumber this
        Lease or any interest herein, or sublet the Leased Premises or any part thereof,
        or permit
        the use of the Leased Premises or any part thereof by any party other than
        Tenant,
        without the prior written consent of Landlord.

       

      Article
        XII. 

      Covenant
        of Quiet Enjoyment.

       

      Section
        12.01. Covenant
        of Quiet Enjoyment.Landlord
        covenants and warrants that
        it
        has all necessary right, title and interest in the Leased Premises to enter
        into
        this Lease
        and
        grant tenant the rights herein. Landlord agrees that if Tenant performs all
        the
        covenants and agreements herein provided to be performed by Tenant, Tenant
        shall,
        at
        all times during the Lease Term, have the peaceable and quiet enjoyment of
        possession
        of the Leased Premises without any manner of hindrance from Landlord or
any
        persons claiming under Landlord subject to the terms of any mortgage to which
        this Lease is subordinate or subordinated to.

       

      Article
        XIII. 

      Termination
        of Lease and Surrender of Leased Premises.

       

      Section
        13.01. Termination.This
        Lease shall Terminate upon any one (1) of the following
        occurrences:

      
        	
                 

                (a)

                 

              	
                 

                Upon
                  expiration of ten (10) days following written notice by Landlord
                  to
                  Tenant,
                  if Tenant continues to be in default in the performance of obligations
                  of
                  this Lease required to be performed by
                  Tenant;

              

      

       

      
        
          
          

        

        
          Page
            12
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                (b)

              	
                 

                Upon
                  expiration of the Initial Term or any Renewal Term where no extension
                  of
                  the Initial Term or Renewal Term has been negotiated;

              
	
                 

                (c)

              	
                 

                Upon
                  expiration of thirty (30) days following written notice by one
                  party to
                  the other during any holdover period;

              
	
                 

                (d)

              	
                 

                -Upon
                  expiration of thirty (30) days following written demand by Landlord
                  to
                  Tenant,
                  if Tenant continues to be more than Five Hundred Dollars ($500.00)
                  in arrears in the payment of monies due and owing Landlord's list
                  of
                  recommended Preferred Providers as listed in the Flagship Enterprise
                  Center Building Rules and Regulations as amended from time to time,
                  for
                  services rendered to Tenant.

              
	
                 

                (e)

              	
                 

                Upon
                  expiration of thirty (30) days following written notice of Landlord's
                  Board of Director's written findings that Tenant, despite written
                  notice
                  and provision of a ninety (90) day period to cure, continues by
                  its
                  conduct to:

              

      

       

      
        	
                 

                (i.)

              	
                 

                depart
                  in a material and significant manner from its business intentions,
                  as originally submitted to Landlord at commencement of the
                  Initial Term;

              
	
                 

                (ii.)

              	
                 

                fail
                  to exercise due diligence in the execution of its business plan
                  and/or
                  pursuit of its business objectives;

              
	
                 

                (iii.)

              	
                 

                be
                  absent from the Building for protracted periods without appropriate
                  excuse
                  or justification;

              
	
                 

                (iv.)

              	
                 

                violate
                  the terms and provisions of the Articles of Incorporation of the
                  Flagship Enterprise Center, Inc.

              

      

       

      Section
        13.02. Surrender.At
        the
        termination or expiration of this Lease, Tenant shall
        deliver the Tenant Space in good order and repair, ordinary wear and tear
        excepted. Tenant shall not be required to surrender any of Tenant's trade
        fixtures, equipment or personal property, unless permanently affixed to the
        Tenant Space, provided
        that any trade fixtures, equipment or personal property of Tenant not removed
        within
        forty-eight (48) hours following the termination or expiration of this Lease
        shall be deemed abandoned and shall become the sole and exclusive property
        of
        the Landlord. Tenant shall repair any damage to the Tenant Space caused by
        removal of any trade fixtures,
        equipment, or personal property of Tenant. In no event will Tenant have the
        right to hold over past the termination of this Lease. Tenant acknowledges
        that
        time is of
        the
        essence and that it is of critical importance for Landlord to have possession
        of
        the Tenant
        Space upon the termination or expiration of this Lease. In the event Tenant
        does
        not
        vacate the Tenant Space as required in this Lease, Landlord shall be entitled
        to
        any
        and all remedies at law or in equity, including, without limitation, the
        right
        to change
        locks on the building, remove all trade fixtures, equipment or personal property
        from
        the
        Tenant Space and/or to demolish all improvements in the Tenant Space, all
        which
        shall be without any liability or claim against Landlord, which are hereby
        waived by
        Tenant.

      
        
          
          

        

        
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            13
            of 19

          
            

          

        

        
          
          

        

      

       

      Article
        XIV. 

      Enforcement
        Expenses. 

       

      Section
        14.01. Enforcement
        Expenses.In
        the
        event that either party hereto shall
        be
        successful in enforcing against the other any remedy, legal or equitable,
        for a
breach
        of
        any of the provisions of this lease, there shall be included in the judgment
        or
any
        decree the reasonable expenses and attorney fees of the successful party
        against
the
        unsuccessful party.

       

      Article
        XV.

      Notices.
        

       

      Section
        15.01, Notices.All
        notices and demands which may or are required to be given by either party
        to the
        other hereunder shall be in writing and shall be deemed to
        have
        been fully given two (2) days after being deposited with the United States
        Postal Service,
        or its successor, as certified or registered mail, postage prepaid, and
addressed
        as follows:

      

      
        	 	 
	
                To
                  Tenant: 

              	
                Altairnano
                  Technologies, Inc.

              
	
                 

              	
                204
                  Edison Way

              
	
                 

              	
                Reno,
                  NV 89502

              
	 	 
	
                 

              	
                Attention:
                  Chief Financial Office

              
	 	 
	 	 
	
                To
                  Landlord:

              	
                Flagship
                  Enterprise Center, Inc. 

              
	
                 

              	
                2701
                  Enterprise Drive, Suite 100 

              
	
                 

              	
                Anderson,
                  Indiana 46013

              
	
                 

              	
                Attention:
                  Executive Director

              

      

       

      or
        to
        such other address as either party may designate from time to time for itself
        by
notice
        similarly given, Any notice to be given may also be given by personal delivery
        of the
        written notice to the person in charge of the business operations at the
        Leased
        Premises at the time of such notice, and shall be deemed effective as of
        the
        date such personal delivery is made.

      
        
          
          

        

        
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      Article
        XVI. 

      Compliance
        With Economic Development Administration ("EDA"1

      Civil
        Rights and Nonrelocation Regulations. 

       

      Section
        16.01. Compliance.
        Inasmuch
        as Landlord has received benefits and grants
        from EDA, Tenant agrees that it shall comply with EDA civil rights requirements,
        which, in general, prohibit unlawful discrimination practices in the work
        place.
        Also, Tenant
        agrees that it shall comply with EDA nonrelocation regulations, which, in
        general,
        prohibit use of EDA financial assistance to assist employers from transferring
        jobs
        from
        one commuting area to another.

       

      Section
        16.02. Execution
        of Certifications. Tenant
        agrees to execute written certifications exhibiting compliance with the matters
        set forth in Section 16.01. More specifically, Tenant agrees to timely execute
        the Assurances of Compliance with Civil Rights and Other Legal Requirements,
        being Exhibit "C" attached hereto. Additionally, Tenant agrees to timely
        execute
        Employer's Nonrelocation Certificate, being Exhibit "C" attached
        hereto.

       

      Article
        XVII. 

      General
        Provisions.

       

      Section
        17.01. Relationship
        of the Parties. Nothing
        herein contained shall be deemed or construed by the parties hereto, nor
        by any
        third party, as creating a relationship of principal and agent, partnership
        or
        joint venture between the parties hereof, it being understood and agreed
        that
        nothing herein, no any acts of the parties hereto,
        shall be deemed to create any relationship between the parties hereto other
        than
        the
        relationship of Landlord and Tenant.

       

      Section
        17.02. Provision
        for Non-Waiver. No
        delay
        or omission of the right to exercise any power by either party shall impair
        any
        such right or power, or shall be construed as a waiver of any default or
        as an
        acquiescence thereon. One or more waivers of any covenant, term or condition
        of
        this Lease by either party shall not be construed
        by the other party as a waiver of subsequent breach of the same covenant,
        term
        or
        condition. Consent or approval by either party to or of any act by the other
        party of
        a
        nature requiring consent or approval shall not be deemed to waive or render
        unnecessary consent to or approval of any subsequent similar act.

       

      Section
        17.03. Recording
        Memorandum of Lease. Either
        party hereto, upon written
        request of the other, shall join in the execution of a Memorandum of Lease
        in
        proper form for recording or filing in the office of the Recorder of Madison
        County, Indiana, which Memorandum shall set forth the existence of terms
        of this
        Lease, with subordination of the leasehold interest to any mortgage by the
        Landlord and such other terms as the parties may mutually agree
        upon.

      
        
          
          

        

        
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      Section
        17.04. Law
        of
        Indiana Governs. The
        laws
        of the State of Indiana shall govern
        the validity, performance and enforcement of this Lease. The invalidity or
        unenforceability of any provision of this Lease shall not affect or impair
        any
        other provision.

       

      Section
        17.05. Complete
        Agreement. The
        headings of the several articles of sections
        contained herein are for convenience only and do not define, limit or construe
        the
        contents of such articles and sections. All negotiations, considerations,
        representations
        and understandings between the parties are incorporated herein and may
        be
        modified or altered only by memorandum in writing signed by the parties
        hereto.

       

      Section
        17.06. Agreement
        Binding on Successor and Assigns. The
        covenants, agreements and obligations herein contained shall extend to, bind
        and
        inure to the benefit
        not only of the parties hereto, but their respective personal representatives,
        heirs,
        successors and assigns.

       

      Section
        17.07. Tenant's
        Compliance with Rules and Regulations. Tenant
        agrees
        to
        conduct its business and operations so as to comply with the Rules and
        Regulations adopted by the Landlord.

       

      IN
        WITNESS WHEREOF, the said parties have hereunto set their hands and seals
        this
        1st, day
        of
        August, 2006.

      

      
        	
                Altairnano
                  Technologies, Inc.

              	 	
                Flagship
                  Enterprise Center

              
	
                LESSEE

              	 	
                LESSOR

              
	 	 	 
	
                BY:

              	 	
                By:

              
	
                Chief
                  Financial Officer

              	 	
                Arthur
                  L. Patterson, Executive
                  Director

              

      

      
        
          
          

        

        
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      EXHIBIT
        "B"

       

      RENT
        SCHEDULE

       

      Subsidized
        Rent  /
        20%
        Subsidy

      
        
          	 	
                   

                  1st
                    12

                	
                   

                  2nd
                    12

                	
                   

                  3rd
                    12

                	
                   

                  4th
                    12

                	
                   

                  5th
                    12

                
	 	
                  months

                   

                	
                  months

                	
                  months

                	
                  months

                	
                  months

                
	
                    
                    Stipulated Fair

                  Market
                    Rent*

                	
                  $21.00

                	
                  $22.00

                	
                  $23.00

                	
                  $24.00

                	
                  $25.00

                
	
                  20%
                    Rent Subsidy*

                	
                  $
                    4.20

                	
                  $
                    4.40

                	
                  $
                    4.60

                	
                  N/A

                	
                  N/A

                
	
                  Monthly
                    Rent*

                	
                  $
                    16.80

                	
                  $
                    17.60

                	
                  $
                    18.40

                	
                  $24.00

                	
                  $25.00

                

        

      

       

      *Rent
        expressed in annual rental per square foot of Leased Space

       

      Rent
        Calculation

       

      During
        the first 12 months of this Lease, Tenant shall pay to Landlord, with respect
        to
each
        calendar year or fractional calendar year, as the case may be, total rental
        payments in the monthly sum of Two Thousand One Hundred Dollars ($ 2,100.00),
        being the sum of: (a) Subsidized
        Rent of One Thousand Six Hundred Eighty Dollars ($ 1,680.00) [being the product
        of
        $
        16.00, the subsidized annual rent per square foot, and square feet, the area
        of
        the Leased Premises,
        divided by 12 months]; and (b) common area monthly rent of Four Hundred Dollars
        ($
        420.00), representing a surcharge of twenty-five percent (25%) of the basic
        monthly rent to cover
        the
        Landlord's cost of maintaining and improving the common areas within the
        building.

       

      During
        subsequent 12 Month periods of this Lease, by similar calculation, Tenant
        shall
pay
        to
        Landlord, with respect to each calendar year or fractional calendar year,
        as the
        case may be,
        total
        rental payments as follows:

      
        	
                 

                2nd
                  12
                  Months:

              	
                 

                $
                  2,200.00 / Month

              
	
                 

                3rd
                  12
                  Months:

              	
                 

                $
                  2,300.00 / Month

              
	
                 

                4th
                  12
                  Months

              	
                 

                $
                  3,000.00 / Month

              
	
                 

                5th
                  12
                  Months

              	
                 

                $
                  3,125.00 / Month

              

      

       

      
        
          
          

        

        
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      EXHIBIT
        "C" 

      EDA
        FORMS

       

       

       

       

       

       

        Page
          19 of 19Lease - Suite 113

    Exhibit
      10.14

                                                                               

    
      	
               

            	 	
               

            

    

     

    CLIENT
      LEASE

    [20%
      RENT SUBSIDY]

     

      
        

      

    

     

    THIS
      LEASE, is made and entered into this 1st
      Day
      of
      September, 2006, by and between FLAGSHIP ENTERPRISE CENTER, INC., an Indiana
      not-for-profit corporation Altairnano Technologies, Inc., a Nevada Corporation,
      and Tenant an Indiana Limited Liability Corporation (hereinafter called
      "Tenant").

     

    Witnesseth
      That:

     

    Article
      I.

    Leased
      Premises. 

     

    Section
      1.01. Lease
      and Description of Premises. Landlord,
      for and in consideration of the rent, covenants, agreements and conditions
      stated herein, does hereby lease to Tenant and Tenant does hereby lease from
      Landlord the following described premises (hereinafter referred to as the
      "Leased Premises") situated in the Flagship
      Enterprise Center Building located at 2701 Enterprise Drive, Flagship Business
      Park,
      Anderson, Indiana 46013 (hereinafter referred to as "Building") and including
      all that
      certain space, which is on the first floor of the Flagship Enterprise Center
      Building
      which is designated Suite #113 consisting of 440 square feet as shown
in
      Exhibit "A." Because of the special nature of Landlord's building, Landlord
      has
      the option,
      in its sole discretion, to require Tenant to move to comparable space in the
      Building during the term of this Lease.

     

    Section
      1.02. Additional
      Consideration to Tenant/Use of Equipment and Shared Services. As
      additional consideration of Tenant's payment of rent as herein below provided,
      Landlord shall provide Tenant with the following equipment and/or
      services:

     

    
      
        
          
          

        

        
          Page
            1 of
            20

          
            

          

        

        
          
          

        

      

    

    

      
        	
                 

                (a)

              	
                 

                Central
                  Office Services.Landlord
                  shall provide a staffed reception area, access to common areas,
                  including
                  scheduled access to conference rooms; access to shared restrooms,
                  exercise
                  room and kitchen facilities; a centralized mail area, including
                  a mailbox
                  for Tenant; access to centralized
                  copying and faxing facilities and equipment; Landlord's standard
                  centralized computer systems and services, including internet access;
                  and security and janitorial services. Tenant is responsible for
                  the
                  cost
                  of any additional office services required by Tenant. Optional
                  services
                  includes
                  a $20.00 fee per data jack used to access broadband and $2.50 per
                  month fee over 36 months for access to VOIP Power over Ethernet.
                  In
                  the
                  event that Tenant desires to replace or upgrade Landlord's standard
                  computer systems or services, Tenant must obtain Landlord's prior
                  written
                  approval.
                  Tenant shall pay all costs and fees incurred in connection with
                  any
                  replacement or upgrade of Landlord's standard computer systems
                  or
                  services.

              

      

    

    
      
        	
                 

                (b)

              	
                 

                Telephone
                  Infrastructure Services. The
                  Landlord will assist in arranging Tenant
                  with local calling area telephone service, telecommunication lines
                  and
                  telephone and computer network jacks. Tenant is responsible for
                  the
                  cost
                  of these lines and any other expenses associated with its telephone
                  service
                  and equipment, including but not limited to charges associated
                  with
                  the installation of additional telephone lines, additional bandwidth
                  requirements,
                  long distance charges, and all other expenses. In the event that
                  Tenant desires to replace or upgrade telephone equipment or service,
                  Tenant
                  must obtain Landlord's prior written approval. Tenant shall pay
                  all
                  costs
                  and fees incurred in connection with such replacement or upgrade.
                  Landlord
                  shall provide Tenant with monthly invoices reflecting any such
                  additional
                  telephone systems and services charges and Tenant shall pay Landlord
                  for such charges within fifteen (15) days of receipt of each invoice.

              
	
                 

                (c)

              	
                 

                Parking.
                  Landlord
                  shall provide Tenant with access to parking facilities, which shall
                  be
                  subject to availability and Landlord's parking facilities policies.
                  Handicapped parking is made available for those tenant/visitors
                  with
                  a handicap parking pass only, all others may be towed or
                  ticketed.

              

      

    

     

    Section
      1.03. Examination
      and Inspection of Leased Premises/Renovation Expenses.
      Tenant
      acknowledges that it has had the opportunity to examine and inspect and
      has
      examined and inspected the Leased Premises. Tenant accepts the Leased Premises
      in their current "as is" condition, subject to the responsibility of the
      Landlord to effect repairs and maintenance as below provided.

     

    As
      per
      the negotiations heretofore completed between the parties, Landlord, prior
      to
      the inception of this Lease, has renovated and improved the Leased Premises.
      As
      to such
      renovations and improvements, Landlord has paid or will pay the total cost
      of
      such renovations and improvements.

    

    
      
        
          
          

        

        
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    Article
      II. 

    Lease
      Term.

     

    Section
      2.01. Initial
      Lease Term. Unless
      sooner terminated under the provisions hereof,
      the term of this Lease shall be for a period of three (3) years (the "Initial
      Term"), commencing on the 1st
      day
      of
      September, 2006 (hereinafter referred to as the "Commencement Date") and ending
      on the 31st,
      day of
      August, 2009.

     

    Section
      2.02. Lease
      Renewal. This
      Lease may be renewed for subsequent terms
      of
      one (1) year (each a "Renewal Term") on such terms as are mutually agreed to
      by
      the
      parties. Provided, however, the rent to be charged by Landlord during certain
      specified
      Renewal Terms shall be no greater than as set forth in paragraph 3.02 below.
      The
      term of this Lease, including the Initial Term and any Renewal Term(s), is
      referred to
      in
      this Lease as the "Term."

     

    Section
      2.03. Provisions
      for Negotiation of Renewal. The
      parties shall commence
      negotiations for a Renewal Term no sooner than ninety (90) days before the
      expiration
      of the existing Term and such negotiations shall be completed no later than
      thirty
      (30) days before the expiration of the existing Term.

     

    Section
      2.04. Holding
      Over. In
      the
      event Tenant remains in possession of the Leased
      Premises after the expiration of the Initial Term and/or expiration of a renewal
      term,
      without the execution of a lease extension agreement or exercise of a renewal
      option,
      Tenant shall be deemed to be occupying the Leased Premises as a tenant from
      month to month and all terms of the Lease shall continue unabated, excepting
      for
      the length
      of
      term as herein specified. Such month to month tenancy may at any time be
      terminated by either party upon thirty (30) days written notice given to the
      other party.

     

    Article
      III. 

    Rental
      Payments.

     

    Section
      3.01. Subsidized
      Rent. Based
      upon negotiations between the parties, Tenant
      shall pay, as rent, to Landlord, a sum equal to eighty percent (80%) of the
      stipulated
      fair market rent of the Leased Premises as set forth in Exhibit "B" ("Subsidized
      Rent"). Such Subsidized Rent shall be increased from each successive
annual
      anniversary date of the lease as shown in Exhibit "B.

     

    Section
      3.02. Rent
      During Renewal Terms. The
      rental payments for any Renewal
      Term shall be in the monetary sum mutually agreed to by the parties prior to
      the
      commencement of the Renewal Term. It is understood, however, that should the
      parties
      agree to extend the Lease Agreement by one (1) or more Renewal Terms, the
rent
      shall be fixed for specified Renewal Terms in amounts no greater than the sums
      recited in the Rent Schedule, attached hereto as Exhibit "B."

    

    
      
        
          
          

        

        
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    Section
      3.03. Obligation
      of Tenant to Relocate in Madison County, Indiana/Provision
      for Reimbursement of Subsidy to Landlord. Tenant
      agrees that, following termination or expiration of this Lease for any reason
      (other than any termination by Landlord during the Initial Term without cause),
      Tenant shall maintain its principal
      place of business and operations in the State of Indiana for a period of time
      at
least
      equal to the length of time that Tenant leases space within the Flagship
      Enterprise Center (the "Subsidized Term"). If, after termination or expiration
      of this Lease, Tenant relocates its principal place of business and operations
      outside of Madison County, Indiana prior to expiration of the Subsidized Term,
      then Tenant shall pay to Landlord an amount
      equal to the difference between (i) the fair market rent for leasing Tenant
      Space during Tenant's tenancy at the Flagship Enterprise Center and (ii) the
      total amount of rent
      paid
      by Tenant to Landlord during such tenancy. The "fair market rent" shall be
      the
stipulated
      fair market rental as set forth in Exhibit "B". The exception to this clause
      shall occur
      with a change in the ownership of a majority of a tenant's stock; if a majority
      interest is acquired by another entity, and that entity requires the relocation
      of the company outside of Madison County, Indiana, then this clause shall not
      apply to the tenant.

     

    Section
      3.04. Landlord's
      Payment of Utilities. Landlord
      shall pay all usage and other
      monthly charges for all utility services rendered or furnished to or based
      upon
      or in connection with the Leased Premises, including, but not limited to,
      electricity, gas, water/sewage,
      or other utility or service. Provided, however, should Tenant's use of the
      Leased
      Premises cause an unreasonable or unexpected use of any utility or utility
      service, Landlord reserves the right, after written notice to Tenant, to charge
      such excessive utility use and the charges therefore to Tenant.

     

    Section
      3.05. Payment
      of Taxes on Real Estate and Personal Property. Landlord
      covenants and agrees to assume and pay all real estate taxes, if any, incurred
      and/or assessed against the real estate and improvements located on the Leased
      Premises.
      Tenant covenants and agrees to assume and pay all personal property taxes
      incurred and/or assessed against the personal property owned by Tenant located
      on
      the
      Leased Premises.

     

    Section
      3.06. Past
      Due Payments. In
      the
      event any rental payment or other payment
      owing from Tenant to Landlord pursuant to this Lease shall become overdue for
      a
      period in excess of ten (10) days, a late charge in the amount of five percent
      (5%) of such overdue payment shall be paid by Tenant to Landlord, which late
      charge shall be payable upon demand. Said late charge shall be in addition
      to
      and not in lieu of any other
      remedy Landlord may have and any fee, charge, payment and advancements
landlord
      may be entitled to hereunder or by law. In the event any rental payment or
      other
      payment owing from Tenant to Landlord pursuant to this Lease shall become
      overdue for a period in excess of twenty-five (25) days, such unpaid amounts
      shall bear interest from the due date thereof to the date of payment at the
      rate
      of one and one-half percent (1 1/2%) per
      month.

    

    
      
        
          
          

        

        
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    Section
      3.07. Place
      of Payments. All
      payments required to be paid, and all statements required to be rendered by
      Tenant to Landlord shall be delivered to Landlord at its address
      set forth in Section 15.01 hereof or to such other address as Landlord specifies
      to
      tenant
      in accordance with such Section.

     

    Article
      IV. 

    Use
      and Occupancy. 

     

    Section
      4.01. Use
      of
      Leased Premises. The
      Leased Premises in the office area shall
      be
      used solely as office or laboratory research space. The Leased Premises in
      the
      manufacturing area shall be used as manufacturing, research or lab space.
Landlord
      may relocate Tenant to comparable space within the Building at Landlord's
sole
      discretion. Tenant will have full access to and use of Tenant Space, and the
      right to
      use
      and access all common areas within the Building on an "as available" basis,
      subject
      to the Flagship Enterprise Center's Building Rules and Regulations, as
amended
      or modified from time to time, which are incorporated by reference into this
      Lease. Tenant hereby acknowledges receipt of the current Building Rules and
      Regulations. Landlord shall provide to Tenant written notice of any amendments
      or modifications to the Building Rules and Regulations, which shall be effective
      with respect
      to Tenant after such notice has been given. Tenant will not have access to
      any
other
      areas within the Building, including but not limited to the space of other
      tenants and
      Landlord's executive offices.

     

    Section
      4.02. Prohibition
      Against Waste and Unlawful Uses. Tenant
      shall not commit or allow any waste or damage to be committed on any portion
      of
      the Leased Premises.
      Tenant shall not occupy or use or permit any portion of the Leased Premises
      to
      be
      occupied or used for any business or purpose which is unlawful, disreputable
      or
      deemed to be hazardous, or permit anything to be done which would in any way
      significantly increase the cost of insurance coverage on the Leased Premises
      or
      its contents.

     

    Section
      4.03. Prohibition
      Against Use or Storage of Hazardous Materials. Tenant
      shall not maintain, store or use any other hazardous materials upon the Leased
      Premises without Landlord's written consent. Hazardous materials shall mean
      any
hazardous,
      toxic or radioactive substance, matter, material or waste which is or
becomes
      regulated by any federal, state or local law, ordinance, order, rule,
      regulations, code
      or
      other governmental restriction or requirement and includes, without limitation,
      asbestos,
      petroleum products and the terms hazardous substance and hazardous waste
      as
      defined in CERCLA and RCRA, as each may be amended. If any hazardous materials
      are necessary for the carrying on of tenant's business operations, notice of
      existence of such materials must be given to Landlord, and Tenant shall retain
      such licenses as may be required to handle, transport and dispose of such
      materials in accordance with local, state and federal rules, regulations and
      laws.

     

    Section
      4.04. Environmental
      Responsibility. Tenant
      must supply Landlord Material
      Safety Data Sheets for all chemicals used by Tenant. Tenant must comply with
      the
      OSHA
      and EPA requirements. Noise levels created by Tenant's machinery must
not
      exceed a limit of 85 decibels or such noise level required by the applicable
      zoning ordinance,
      whichever is lower. Tenant shall defend and hold Landlord harmless from all
      fines,
      penalties and costs relating to any violation or noncompliance with such laws
      and regulations.

    

    
      
        
          
          

        

        
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    Section
      4.05. Prohibition
      Against Excessive Floor Loads. Tenant
      shall not overload the floors of the Tenant Space beyond their designed
      weight-bearing capacity. Landlord reserves the right to direct the positioning
      of all heavy equipment, furniture and fixtures that Tenant desires to place
      in
      the Tenant Space so as to distribute weight properly. Landlord may require
      the
      removal of any equipment, furniture or fixtures that exceeds appropriate weight
      limits for the Tenant Space.

     

    Section
      4.06. Condition,
      Alterations and Additions. Tenant's
      acceptance of the Leased Premises on the Commencement Date shall be as is,
      where
      is and without warranty of any kind as to zoning, condition, fitness for
      Tenant's business purpose or otherwise.
      Tenant assumes sole responsibility for examining the Leased Premises prior
      to
      the
      Commencement Date to assure itself of the Leased Premises' compliance with
      this
      Lease and Tenant's business purpose. Tenant
      shall make no leasehold improvements,
      alterations or additions to any part of the Leased Premises
without
      the prior written consent of Landlord. All
      such
      improvements, alterations and
      additions, excepting only unattached and movable trade fixtures, shall be the
      sole property of Landlord.

     

    Section
      4.07. Signage.All
      signage, whether installed inside the structure on the Leased Premises or on
      the
      exterior thereof, shall be subject to the written approval of
      Landlord.

     

    Article
      V. 

    Maintenance
      and Repairs.

     

    Section
      5.01. Maintenance
      by Landlord. Landlord,
      at Landlord's expense, shall keep
      the
      foundation, walls and other structural parts, including the roof, of the
      building in reasonable order, condition and repair; provided, however, Landlord
      shall not be responsible
      for making any repairs or replacements occasioned by any act or negligence
      of Tenant, its employees, contractors, agents, invitees, licensees or
      concessionaires. Landlord shall also keep, maintain, replace and repair the
      Leased Premises and every part thereof in good order, condition and repair,
      including, but not limited to, interior and exterior electrical, mechanical
      and
      utility equipment and systems; fixtures; and interior walls, floors and
      ceilings.

     

    Section
      5.02. Payment
      of Cleaning & Janitorial Service Expenses. Tenant
      shall assume
      and pay ail expenses for routine/customary cleaning and janitorial services
      to
keep
      the
      Leased Premises in a clean and orderly condition. Should Tenant fail in this
      responsibility, Landlord reserves the right, but shall not be obligated, to
      cause the Leased Premises to be cleaned and charges therefore would be assessed
      to Tenant. Landlord
      shall assume and pay all expenses for routine/customary cleaning and
janitorial
      services to keep the Common Areas within the Building in a clean and orderly
      condition. Tenants are responsible for picking up after themselves in the
      kitchen area.

    

    
      
        
          
          

        

        
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    Section
      5.03. Landlord's
      Provision of Snow Removal and Lawn Care. As
      additional consideration for Tenant's payment of Monthly Rental Payments,
      Landlord, during the Initial Term and any Renewal Term, shall provide snow
      removal for Tenant's parking
      and walkways and shall further provide lawn care and landscaping services to
      the
      area
      surrounding the Leased Premises.

     

    Section
      5.04. Notice.
      Tenant
      shall give Landlord prompt written notice of the need
      for
      any maintenance, replacement or repairs which Landlord is obligated to make
      under
      foregoing Section 5.01 and of any material damage to the Leased Premises or
      any
      part
      thereof.

     

    Section
      5.05. Access
      to Leased Premises. Landlord
      and its agents may retain a pass
      key
      to the Leased Premises and shall have the right to enter the Leased Premises
      at any
      and
      all times to service and inspect the Leased Premises. During the period
      beginning sixty (60) days prior to the expiration of the Initial Term or any
      Renewal Term (unless
      Landlord has already agreed to extend the Term of this Lease), Landlord's staff
      may
      enter
      the Leased Premises to show the Leased Premises to prospective
      tenants.

     

    Article
      VI. 

    Insurance
      and Indemnification. 

     

    Section
      6.01. Public
      Liability Insurance: Tenant. Tenant,
      at Tenant's expense, shall
      maintain in full force and effect throughout the Lease Term a policy of general
      public
      liability insurance naming Landlord as an additional insured and covering any
      and all
      claims for injuries to or death of persons and damage to property occurring
      in
      or upon
      the
      Leased Premises, in an amount not less than One Million Dollars ($1,000,000.00)
      for injury to or death of any one person; Two Million Dollars ($2,000,000.00)
      for injury to or death of more than one person in the same accident or
      occurrence; and Five Hundred Thousand Dollars ($500,000.00) for damaged property
      arising out of any one accident or occurrence.

     

    Section
      6.02. Insurance
      on Tenant's Property. All
      of
      Tenant's fixtures, equipment,
      merchandise or other personal property shall be kept at Tenant's sole risk
      and
      expense, and Tenant, at Tenant's expense, shall maintain in full force and
      effect throughout the Lease Term fire and extended coverage insurance on its
      fixtures, equipment,
      merchandise and other personal property in or upon the Leased Premises
for
      its
      full insurable value on a replacement cost basis, if obtainable, and if not
      obtainable, for the full amount of the estimated cash value for such
      property.

     

    Section
      6.03. Insurance
      on Leased Premises. Landlord
      shall maintain in full force
      and
      effect throughout the Lease Term broad form fire and extended coverage insurance
      on the Leased Premises and Landlord's fixtures, equipment and personal property,
      in, on or about the Leased Premises, for their full insurable value on a
      replacement cost basis, if obtainable, and if not obtainable, for the full
      amount of its actual cash value.

    

    
      
        
          
          

        

        
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    Section
      6.04. Waiver
      of Subrogation. Each
      of
      the parties hereto hereby waivers and
      releases any and all rights of recovery which it might have against the other
      for any loss
      or
      damage, whether or not caused by any alleged negligence of the other party,
      its
      agents, licensees or invitees, to the extent that such loss or damage is or
      would be covered by any insurance required to be maintained under this Lease.
      Each policy of insurance
      required under this Lease shall contain an endorsement to such effect, so
long
      as
      such endorsement is available. Should either Landlord or Tenant be unable to
      procure
      such an endorsement, the other party shall be relieved of carrying insurance
      with
      such
      an endorsement and the foregoing provisions for waiver of right of recovery
      against the other (right of subrogation) shall be of no further force or
      effect.

     

    Section
      6.05. Tenant's
      Indemnification. Unless
      caused or contributed to by the gross
      negligence or willful misconduct of Landlord, its agents or employees, Tenant
      assumes all risks and responsibilities for accidents, injuries or damages to
      person or property and agrees to indemnify and hold Landlord harmless from
      any
      and all claims, liabilities, losses, costs and expenses (including attorneys'
      fees) arising from or in connection with its, use or control of the Leased
      Premises and any improvements thereon during the Lease Term or Tenant's breach
      of any term, covenant, condition or agreement to be observed by Tenant under
      this Lease. Tenant shall be liable to Landlord for any damages caused by gross
      negligence or willful misconduct to the Leased Premises and for gross negligence
      or willful misconduct done by Tenant or any person
      coming on the Leased Premises by the license or invitation of Tenant, express
      or
      implied (except Landlord, its agents or employees).

     

    Section
      6.06. Tenant's
      Waiver of Claims. Landlord
      shall not be liable for, and Tenant waives all claims against Landlord for,
      any
      injuries, damages (including, but not limited to, consequential damages) or
      losses of or to person, property or otherwise, sustained by Tenant and not
      covered by insurance, unless resulting from Landlord's gross
      negligence or willful misconduct. All property of Tenant kept or stored in,
      upon
      or about
      the
      Leased Premises shall be so kept or stored at the sole risk of Tenant; and
      Tenant shall hold Landlord harmless from any claims, costs or expenses,
      including attorneys' fees, arising out of damage thereto, unless such claim
      arises out of grossly negligent or willful misconduct on the part of Landlord,
      its agents and employees.

     

    Section
      6.07. Certificates
      of Insurance. For
      each
      type of insurance which Landlord
      or Tenant are required to maintain under this Lease, each shall furnish the
      other
      an
      endorsed copy of such insurance policy showing that each such type of insurance
      is in full force and effect and not cancelable without thirty (30) days prior
      written notice to the other party.

    

    
      
        
          
          

        

        
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    Article
      VII. 

    Eminent
      Domain.

     

    Section
      7.01. Legal
      Effect. If
      the
      whole or any part of the Leased Premises is taken
      for
      public or quasi-public use by a governmental or other authority having the
      power
      of eminent domain, or shall be conveyed to any such authority in lieu of such
      taking, and if such taking or conveyance shall cause the remaining part of
      the
      Leased Premises to be untenantable and inadequate for Tenant's Business, then
      Landlord or Tenant may, at their option, terminate this Lease as of the date
      Tenant is required to surrender possession of the Leased Premises by giving
      the
      other party notice of such termination. If a part of the Leased Premises shall
      be taken or conveyed, but the remaining part is tenantable and adequate for
      Tenant's Business (as reasonably determined by Tenant, and with notice of such
      determination given to Landlord within fifteen
      (15) days of any such taking), then this Lease shall be terminated as to the
      part taken
      or
      conveyed as of the date Tenant surrenders possession thereof; Landlord shall
      make
      such
      repairs, alterations and improvements as may be necessary to render the
part
      not
      taken or conveyed tenantable; and the rent shall be reduced in proportion to
      the
part
      of
      the Leased Premises so taken or conveyed.

     

    Section
      7.02. Payment
      of Award. All
      compensation awarded for such taking or conveyance
      shall be the sole property of Landlord, without any deduction therefrom for
      any
      present or future estate of Tenant, and Tenant hereby assigns to Landlord all
      its right,
      title and interest in and to any such award; provided, however, Tenant shall
      have the
      right
      to recover from such taking authority, but not from Landlord, such compensation
      as may be awarded to Tenant on account of moving and relocation expenses and
      depreciation to and removal of Tenant's property.

     

    Article
      VIII. 

    Destruction
      and Damage.

     

    Section
      8.01. Damage
      by Casualty. In
      the
      event of a fire or other casualty in the Leased Premises, Tenant shall give
      prompt notice thereof to Landlord. If the Leased Premises
      shall be partially destroyed by fire or other casualty so as to render the
      Leased
      Premises partially or wholly untenantable, the Rent shall be abated on the
      basis
of
      leasable square footage remaining and occupied thereafter, until such time
      as
      the Leased Premises are made fully fit for use by Tenant; provided, however,
      that if gross negligence
      or willful misconduct of Tenant, or its agents, employees or invitees shall
      have
      contributed to the cause of such fire or other casualty, the Rental shall not
      be
      abated during the period of restoration of the Leased Premises.

     

    Section
      8.02. Restoration;
      Partial or Total Destruction of Building. In
      the
      event the
      Building shall be partially or totally destroyed by fire or other casualty,
      the
      same shall
      be
      repaired as soon as is reasonably possible, at the expense of Landlord, unless
      Landlord shall elect to terminate this Lease as hereinafter provided. If damage
      to the Leased Premises is to such extent that the cost of restoration, as
      estimated by Landlord will
      exceed fifty percent (50%) of the replacement value of the Leased Premises
      (including
      the building standard improvements) or thirty percent (30%) of the replacement
      value of the Building (exclusive of the foundation) in its condition just prior
      to
      the
      occurrence of the damage, Landlord may, no later than the sixtieth
      (60th)
      day
following
      such damage, give Tenant notice that it elects to terminate this Lease. if
      such
notice
      shall be given:

    

    
      
        
          
          

        

        
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              (a)

            	
               

              This
                Lease shall terminate on the twentieth (20th
                )
                day following the giving of
                said notice;

            
	
               

              (b)

            	
               

              Tenant
                shall surrender possession of the Leased Premises on or before such
                termination date; and

            
	
               

              (c)

            	
               

              The
                rental provided hereunder shall be apportioned as of the date of
                such
                termination and any Rental paid for any period beyond said date shall
                be
                refunded to Tenant.

            

    

     

    Unless
      Landlord so elects to terminate this Lease, Landlord shall proceed with the
      restoration
      of the Leased Premises and/or the Building as soon as reasonably possible.
      If
      the
      damage to the Building as the result of any casualty is such that the Leased
      Premises
      cannot be used by Tenant for Tenant's Business for a period of three (3) or
      more
      months, as estimated by Landlord, either Landlord or Tenant may cancel and
      terminate
      this Lease by giving notice of such termination to the other party within thirty
      (30) days after the date of such casualty. In such event of termination, all
      Rental shall be
      apportioned as of the date of such termination and any Rental paid for any
      period beyond
      said date shall be refunded to Tenant. In no event, however, shall Tenant have
      the
      right
      to cancel or terminate this Lease if the gross misconduct or willful neglect
      of
      Tenant, or its agents, employees or invitees shall have contributed to the
      cause
      of such casualty.

     

    Article
      IX. 

    Events
      of Default and Remedies.

     

    Section
      9.01. Events
      of Default. The
      occurrence of any one (1) or more of the following events shall be deemed to
      be
      an "Event of Default":

    
      	
               

              (a)

            	
               

              The
                failure of Tenant to pay any installment of rent within thirty (30)
                days
                after its due date;

            
	
               

              (b)

            	
               

              The
                failure of Tenant to perform any other of its covenants under this
                Lease
                or to comply with the Building Rules and Regulations within thirty
                (30)
                days after
                written notice or demand therefore is served upon Tenant by
                Landlord;

            
	
               

              (c)

            	
               

              The
                making by Tenants of an assignment for the benefit of
                creditors;

            

    

     

    
      
        
          
          

        

        
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              (d)

            	
               

              The
                levying of a writ of execution or attachment on or against the Leased
                Premises or Tenant's interest therein as the property of Tenant,
                and the
                same not being released or discharged within sixty (60) days
                thereafter;

            
	
               

              (e)

            	
               

              The
                institution of proceedings in a court of competent jurisdiction for
                the
                reorganization,
                liquidation, voluntary or involuntary dissolution of Tenant, or
                for
                its adjudication as a bankrupt or insolvent, or for the appointment
                of a
                receiver of the property of Tenant, and said proceedings are not
                dismissed
                within sixty (60) days after the institution of said proceedings;
                or

            
	
               

              (f)

            	
               

              A
                mechanic's lien or similar lien upon the Leased Premises or the building
                is
                asserted of record in connection with work allegedly done in or about
                the
                Leased Premises at the request or instance of Tenant, and the same
                is not
                removed by Tenant, or adequate security for the satisfaction thereof
                deposited
                with Landlord, within forty-five (45) days from the date any such
                lien
                was filed in the office of the Recorder of Madison County,
                Indiana.

            

    

     

    Section
      9.02 Remedies.
      Upon
      the
      occurrence of an Event of Default, Landlord shall
      have the option to:

    
      	
               

              (a)

            	
               

              Re-enter
                the Leased Premises with or without process of law, using such means
                as
                may be necessary to remove all persons and property therefrom;
                and/or

            
	
               

              (b)

            	
               

              Exercise
                any other right or remedy available to Landlord at law or in equity
                in
                addition to or as an alternative to any of the other rights and remedies
                of Landlord herein specified upon the occasion of any such Event
                of
                Default.

            

    

     

    In
      the
      event that subsequent to an Event of Default, Landlord should reset the Leased
      Premises
      or a portion thereof during the balance of the Term of this Lease, the
proceeds
      of such reletting, after deduction of all reasonable costs incurred by Landlord
      in
      connection with repossession and reletting of the Leased Premises (including
      without limitation,
      all legal fees, leasing commissions, remodeling costs and similar expenses)
      shall
      be
      applied to satisfaction of Tenant's obligations hereunder. Landlord shall have
      the
      right
      to file suit to recover any sums which have fallen due under this Lease from
      time
      to
      time on one (1) or more occasions without being obligated to wait until the
      expiration of the Term of this Lease. Alternatively, in the event Landlord
      should elect to terminate this Lease, Landlord shall be entitled to recover
      forthwith as damages from Tenant a sum of money equal to: (i) the cost of
      recovering possession of the Leased Premises,
      (ii) the unpaid Rent owed at the time of such termination; (iii) the balance
      of
the
      Rent
      for the remainder of the term; and (iv) any other sum of money or damages
owed
      by
      Tenant to Landlord, less the fair market rental value of the Leased Premises
      for
      the
      remainder of the term of this Lease.

    

    
      
        
          
          

        

        
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    Article
      X. 

    Subordination.

     

    Section
      10.01. Subordination.
      Upon
      request by Landlord, this Lease shall become subordinate to the lien of a
      mortgage given by Landlord, if such mortgage provides
      that Tenant's rights under this Lease and possession of the Leased Premises
      shall
      not
      be disturbed as long as it performs its duties hereunder. Tenant shall enter
      into
      any
      confirming subordination and non-disturbance agreement such mortgagee may
      reasonably require.

     

    Article
      Xl. 

    Assignment
      and Subletting.

     

    Section
      11.01. Assignment
      and Subletting. Tenant
      shall not assign or encumber this
      Lease or any interest herein, or sublet the Leased Premises or any part thereof,
      or permit
      the use of the Leased Premises or any part thereof by any party other than
      Tenant,
      without the prior written consent of Landlord.

     

    Article
      XII. 

    Covenant
      of Quiet Enjoyment.

     

    Section
      12.01. Covenant
      of Quiet Enjoyment. Landlord
      covenants and warrants that
      it
      has all necessary right, title and interest in the Leased Premises to enter
      into
      this Lease
      and
      grant tenant the rights herein. Landlord agrees that if Tenant performs all
      the
      covenants and agreements herein provided to be performed by Tenant, Tenant
      shall,
      at
      all times during the Lease Term, have the peaceable and quiet enjoyment of
      possession
      of the Leased Premises without any manner of hindrance from Landlord or
any
      persons claiming under Landlord subject to the terms of any mortgage to which
      this Lease is subordinate or subordinated to.

     

    Article
      XIII. 

    Termination
      of Lease and Surrender of Leased Premises.

     

    Section
      13.01. Termination.
      This
      Lease shall Terminate upon any one (1) of the following
      occurrences:

    
      	
               

              (a)

               

            	
               

              Upon
                expiration of ten (10) days following written notice by Landlord
                to
                Tenant,
                if Tenant continues to be in default in the performance of obligations
                of
                this Lease required to be performed by
                Tenant;

            

    

     

    
      
        
          
          

        

        
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              (b)

            	
               

              Upon
                expiration of the Initial Term or any Renewal Term where no extension
                of
                the Initial Term or Renewal Term has been negotiated;

            
	
               

              (c)

            	
               

              Upon
                expiration of thirty (30) days following written notice by one party
                to
                the other during any holdover period;

            
	
               

              (d)

            	
               

              -Upon
                expiration of thirty (30) days following written demand by Landlord
                to
                Tenant,
                if Tenant continues to be more than Five Hundred Dollars ($500.00)
                in arrears in the payment of monies due and owing Landlord's list
                of
                recommended Preferred Providers as listed in the Flagship Enterprise
                Center Building Rules and Regulations as amended from time to time,
                for
                services rendered to Tenant.

            
	
               

              (e)

            	
               

              Upon
                expiration of thirty (30) days following written notice of Landlord's
                Board of Director's written findings that Tenant, despite written
                notice
                and provision of a ninety (90) day period to cure, continues by its
                conduct to:

            

    

     

    
      	
               

              (i.)

            	
               

              depart
                in a material and significant manner from its business intentions,
                as originally submitted to Landlord at commencement of the
                Initial Term;

            
	
               

              (ii.)

            	
               

              fail
                to exercise due diligence in the execution of its business plan and/or
                pursuit of its business objectives;

            
	
               

              (iii.)

            	
               

              be
                absent from the Building for protracted periods without appropriate
                excuse
                or justification;

            
	
               

              (iv.)

            	
               

              violate
                the terms and provisions of the Articles of Incorporation of the
                Flagship Enterprise Center, Inc.

            

    

     

    Section
      13.02. Surrender.
      At
      the
      termination or expiration of this Lease, Tenant shall
      deliver the Tenant Space in good order and repair, ordinary wear and tear
      excepted. Tenant shall not be required to surrender any of Tenant's trade
      fixtures, equipment or personal property, unless permanently affixed to the
      Tenant Space, provided
      that any trade fixtures, equipment or personal property of Tenant not removed
      within
      forty-eight (48) hours following the termination or expiration of this Lease
      shall be deemed abandoned and shall become the sole and exclusive property
      of
      the Landlord. Tenant shall repair any damage to the Tenant Space caused by
      removal of any trade fixtures,
      equipment, or personal property of Tenant. In no event will Tenant have the
      right to hold over past the termination of this Lease. Tenant acknowledges
      that
      time is of
      the
      essence and that it is of critical importance for Landlord to have possession
      of
      the Tenant
      Space upon the termination or expiration of this Lease. In the event Tenant
      does
      not
      vacate the Tenant Space as required in this Lease, Landlord shall be entitled
      to
      any
      and all remedies at law or in equity, including, without limitation, the right
      to change
      locks on the building, remove all trade fixtures, equipment or personal property
      from
      the
      Tenant Space and/or to demolish all improvements in the Tenant Space, all
which
      shall be without any liability or claim against Landlord, which are hereby
      waived by
      Tenant.

    

    
      
        
          
          

        

        
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    Article
      XIV. 

    Enforcement
      Expenses. 

     

    Section
      14.01. Enforcement
      Expenses. In
      the
      event that either party hereto shall
      be
      successful in enforcing against the other any remedy, legal or equitable, for
      a
breach
      of
      any of the provisions of this lease, there shall be included in the judgment
      or
any
      decree the reasonable expenses and attorney fees of the successful party against
      the
      unsuccessful party.

     

    Article
      XV.

    Notices.
      

     

    Section
      15.01, Notices.
      All
      notices and demands which may or are required to be given by either party to
      the
      other hereunder shall be in writing and shall be deemed to
      have
      been fully given two (2) days after being deposited with the United States
      Postal Service,
      or its successor, as certified or registered mail, postage prepaid, and
addressed
      as follows:

    

    
      	 	 
	
              To
                Tenant: 

            	
              Altairnano
                Technologies, Inc.

            
	
               

            	
              204
                Edison Way

            
	
               

            	
              Reno,
                NV 89502

            
	 	 
	
               

            	
              Attention:
                Chief Financial Office

            
	 	 
	 	 
	
              To
                Landlord:

            	
              Flagship
                Enterprise Center, Inc. 

            
	
               

            	
              2701
                Enterprise Drive, Suite 100 

            
	
               

            	
              Anderson,
                Indiana 46013

            
	
               

            	
              Attention:
                Executive Director

            

    

     

    or
      to
      such other address as either party may designate from time to time for itself
      by
notice
      similarly given, Any notice to be given may also be given by personal delivery
      of the
      written notice to the person in charge of the business operations at the Leased
      Premises at the time of such notice, and shall be deemed effective as of the
      date such personal delivery is made.

    

    
      
        
          
          

        

        
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    Article
      XVI. 

    Compliance
      With Economic Development Administration ("EDA"1

    Civil
      Rights and Nonrelocation Regulations. 

     

    Section
      16.01. Compliance.
      Inasmuch
      as Landlord has received benefits and grants
      from EDA, Tenant agrees that it shall comply with EDA civil rights requirements,
      which, in general, prohibit unlawful discrimination practices in the work place.
      Also, Tenant
      agrees that it shall comply with EDA nonrelocation regulations, which, in
general,
      prohibit use of EDA financial assistance to assist employers from transferring
      jobs
      from
      one commuting area to another.

     

    Section
      16.02. Execution
      of Certifications. Tenant
      agrees to execute written certifications exhibiting compliance with the matters
      set forth in Section 16.01. More specifically, Tenant agrees to timely execute
      the Assurances of Compliance with Civil Rights and Other Legal Requirements,
      being Exhibit "C" attached hereto. Additionally, Tenant agrees to timely execute
      Employer's Nonrelocation Certificate, being Exhibit "C" attached
      hereto.

     

    Article
      XVII. 

    General
      Provisions.

     

    Section
      17.01. Relationship
      of the Parties. Nothing
      herein contained shall be deemed or construed by the parties hereto, nor by
      any
      third party, as creating a relationship of principal and agent, partnership
      or
      joint venture between the parties hereof, it being understood and agreed that
      nothing herein, no any acts of the parties hereto,
      shall be deemed to create any relationship between the parties hereto other
      than
      the
      relationship of Landlord and Tenant.

     

    Section
      17.02. Provision
      for Non-Waiver. No
      delay
      or omission of the right to exercise any power by either party shall impair
      any
      such right or power, or shall be construed as a waiver of any default or as
      an
      acquiescence thereon. One or more waivers of any covenant, term or condition
      of
      this Lease by either party shall not be construed
      by the other party as a waiver of subsequent breach of the same covenant,
term
      or
      condition. Consent or approval by either party to or of any act by the other
      party of
      a
      nature requiring consent or approval shall not be deemed to waive or render
      unnecessary consent to or approval of any subsequent similar act.

     

    Section
      17.03. Recording
      Memorandum of Lease. Either
      party hereto, upon written
      request of the other, shall join in the execution of a Memorandum of Lease
      in
      proper form for recording or filing in the office of the Recorder of Madison
      County, Indiana, which Memorandum shall set forth the existence of terms of
      this
      Lease, with subordination of the leasehold interest to any mortgage by the
      Landlord and such other terms as the parties may mutually agree
      upon.

    

    
      
        
          
          

        

        
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    Section
      17.04. Law
      of
      Indiana Governs. The
      laws
      of the State of Indiana shall govern
      the validity, performance and enforcement of this Lease. The invalidity or
      unenforceability of any provision of this Lease shall not affect or impair
      any
      other provision.

     

    Section
      17.05. Complete
      Agreement. The
      headings of the several articles of sections
      contained herein are for convenience only and do not define, limit or construe
      the
      contents of such articles and sections. All negotiations, considerations,
representations
      and understandings between the parties are incorporated herein and may
      be
      modified or altered only by memorandum in writing signed by the parties
      hereto.

     

    Section
      17.06. Agreement
      Binding on Successor and Assigns. The
      covenants, agreements and obligations herein contained shall extend to, bind
      and
      inure to the benefit
      not only of the parties hereto, but their respective personal representatives,
      heirs,
      successors and assigns.

     

    Section
      17.07. Tenant's
      Compliance with Rules and Regulations. Tenant
      agrees
      to
      conduct its business and operations so as to comply with the Rules and
      Regulations adopted by the Landlord.

     

    IN
      WITNESS WHEREOF, the said parties have hereunto set their hands and seals this
      1st, day
      of
      August, 2006.

    

    
      	
              Altairnano
                Technologies, Inc.

            	 	
              Flagship
                Enterprise Center

            
	
              LESSEE

            	 	
              LESSOR

            
	 	 	 
	
              BY:

            	 	
              By:

            
	
              Chief
                Financial Officer

            	 	
              Arthur
                L. Patterson, Executive Director

            

    

     

     

    
      
        
        

      

      
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      EXHIBIT
        "A"

      

      FIRST
        FLOOR DIAGRAM - Suite 113

    

    

    
      
        
          
          

        

        
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    RENT
      SCHEDULE

     

    Subsidized
      Rent  /
      20%
      Subsidy

    
      
        	 	
                 

                1st
                  12

              	
                 

                2nd
                  12

              	
                 

                3rd
                  12

              	
                 

                4th
                  12

              	
                 

                5th
                  12

              
	 	
                months

                 

              	
                months

              	
                months

              	
                months

              	
                months

              
	
                  
                  Stipulated Fair

                Market
                  Rent*

              	
                $21.00

              	
                $22.00

              	
                $23.00

              	
                $24.00

              	
                $25.00

              
	 	 	 	 	 	 
	
                20%
                  Rent Subsidy*

              	
                $
                  4.20

              	
                $
                  4.40

              	
                $
                  4.60

              	
                N/A

              	
                N/A

              
	 	 	 	 	 	 
	
                Monthly
                  Rent*

              	
                $
                  16.80

              	
                $
                  17.60

              	
                $
                  18.40

              	
                $24.00

              	
                $25.00

              

      

    

     

    *Rent
      expressed in annual rental per square foot of Leased Space

     

    Rent
      Calculation

     

    During
      the first 12 months of this Lease, Tenant shall pay to Landlord, with respect
      to
each
      calendar year or fractional calendar year, as the case may be, total rental
      payments in the monthly sum of Seven Hundred Seventy Dollars ($ 770.00),
      being the sum of: (a) Subsidized
      Rent of Six Hundred Sixteen Dollars ($ 616.00) [being the product
of
      $
      16.80, the subsidized annual rent per square foot, and 440
      square feet, the area of the Leased Premises,
      divided by 12 months]; and (b) common area monthly rent of One Hundred
      Fifty Four Dollars ($ 154.00),
      representing a surcharge of twenty-five percent (25%) of the basic monthly
      rent
      to cover
      the
      Landlord's cost of maintaining and improving the common areas within the
      building.

     

    During
      subsequent 12 Month periods of this Lease, by similar calculation, Tenant shall
      pay
      to
      Landlord, with respect to each calendar year or fractional calendar year, as
      the
      case may be,
      total
      rental payments as follows:

    
      	
               

              2nd
                12
                Months:

            	
               

              $
                807.00 / Month

            
	
               

              3rd
                12
                Months:

            	
               

              $
                843.00 / Month

            
	
               

              4th
                12
                Months

            	
               

              $
                1,100.00 / Month

            
	
               

              5th
                12
                Months

            	
               

              $
                1,146.00 / Month

            

    

     

    
      
        
          
          

        

        
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    EXHIBIT
      "C" 

    EDA
      FORMS

     

     

    (ALREADY
      ON FILE WITH
      FEC)

     

     

     

     

     

     

      Page
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